0001144204-18-007386.txt : 20180212 0001144204-18-007386.hdr.sgml : 20180212 20180212172516 ACCESSION NUMBER: 0001144204-18-007386 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 67 CONFORMED PERIOD OF REPORT: 20170930 FILED AS OF DATE: 20180212 DATE AS OF CHANGE: 20180212 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PLEDGE PETROLEUM CORP CENTRAL INDEX KEY: 0001434110 STANDARD INDUSTRIAL CLASSIFICATION: OIL AND GAS FIELD EXPLORATION SERVICES [1382] IRS NUMBER: 261856569 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-53488 FILM NUMBER: 18597676 BUSINESS ADDRESS: STREET 1: 10655 BAMMEL NORTH HOUSTON ROAD STREET 2: SUITE 100 CITY: HOUSTON STATE: TX ZIP: 77086 BUSINESS PHONE: (713) 227- 0480 MAIL ADDRESS: STREET 1: 10655 BAMMEL NORTH HOUSTON ROAD STREET 2: SUITE 100 CITY: HOUSTON STATE: TX ZIP: 77086 FORMER COMPANY: FORMER CONFORMED NAME: PLEDGE PTEROLEUM CORP. DATE OF NAME CHANGE: 20170221 FORMER COMPANY: FORMER CONFORMED NAME: Propell Technologies Group, Inc. DATE OF NAME CHANGE: 20130118 FORMER COMPANY: FORMER CONFORMED NAME: Propell Corporation. DATE OF NAME CHANGE: 20080501 10-Q 1 tv482307_10q.htm 10-Q

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended September 30, 2017

 

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: 000-53488

 

PLEDGE PETROLEUM CORP.

(Exact name of registrant as specified in its charter)

 

Delaware   26-1856569
(State or other jurisdiction of   (I.R.S. employer
incorporation or organization)   Identification No.)

 

11811 North Freeway, 5th Floor,

Suite 513, Houston, TX 77060

(Address of principal executive offices) (Zip Code)

 

(832) 328- 0169

(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 ¨ No x

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ¨ No x

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer ¨   Accelerated filer ¨
Non-accelerated filer ¨ (Do not check if a smaller reporting company) Smaller reporting company x
      Emerging growth company ¨

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

 

The Registrant has 268,558,931 shares of common stock outstanding as of February 9, 2018.

 

Documents incorporated by reference: None 

 

 

 

  

 

 

PLEDGE PETROLEUM CORP.

NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). In particular, statements contained in this Quarterly Report on Form 10-Q, including but not limited to, statements regarding the sufficiency of our cash, our ability to finance our operations and business initiatives and obtain funding for such activities; our future results of operations and financial position, business strategy and plan prospects, or costs and objectives of management for future acquisitions, are forward looking statements. These forward-looking statements relate to our future plans, objectives, expectations and intentions and may be identified by words such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “intends,” ’‘targets,” “projects,” “contemplates,” ’‘believes,” “seeks,” “goals,” “estimates,” ’‘predicts,” ’‘potential” and “continue” or similar words. Readers are cautioned that these forward-looking statements are based on our current beliefs, expectations and assumptions and are subject to risks, uncertainties, and assumptions that are difficult to predict, including those identified below, under Part II, Item 1A. “Risk Factors” and elsewhere in this Quarterly Report on Form 10-Q, and those identified under Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2016 filed with the SEC on August 7, 2017. Therefore, actual results may differ materially and adversely from those expressed, projected or implied in any forward-looking statements. We undertake no obligation to revise or update any forward-looking statements for any reason.

 

NOTE REGARDING COMPANY REFERENCES

 

Throughout this Quarterly Report on Form 10-Q, “Pledge,” the “Company,” “we,” “us” and “our” refer to Pledge Petroleum Corp.

  

 

 

PLEDGE PETROLEUM CORP.

 

FORM 10-Q

 

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2017

 

TABLE OF CONTENTS

 

    Page
  PART I-FINANCIAL INFORMATION  
Item l. Financial Statements F-1
  Condensed Consolidated Balance Sheets as of September 30, 2017 (Unaudited) and December 31, 2016 F-1
  Unaudited Condensed Consolidated Statements of Operations for the three months and nine months ended September 30, 2017 and 2016 F-2
  Unaudited Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2017 and 2016 F-3
  Notes to the Unaudited Condensed Consolidated Financial Statements F-4
Item 2. Management’s Discussion and Analysis of Financial Information and Results of Operations 3
Item 3. Quantitative and Qualitative Disclosures About Market Risk 8
Item 4. Controls and Procedures 8
     
  PART II-OTHER INFORMATION  
Item 1. Legal Proceedings 9
Item 1A. Risk Factors 9
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 9
Item 3. Defaults Upon Senior Securities 9
Item 4. Mine Safety Disclosures 9
Item 5. Other Information 9
Item 6. Exhibits 10
SIGNATURES   10

 

 2 

 

 

PART I - FINANCIAL INFORMATION

 

Item 1. Financial Statements.

 

PLEDGE PETROLEUM CORP.

CONDENSED CONSOLIDATED BALANCE SHEETS

 

   September 30,   December 31, 
   2017   2016 
   (Unaudited)     
Assets          
           
Current Assets          
Cash  $8,755,803   $9,170,286 
Prepaid expenses   19,684    25,940 
Total Current Assets   8,775,487    9,196,226 
           
Non-Current Assets          
Plant and equipment, net   10,198    14,326 
Deposits   530    6,968 
Total Non-Current Assets   10,728    21,294 
Total Assets  $8,786,215   $9,217,520 
           
Liabilities and Stockholders' Equity          
           
Current Liabilities          
Accounts payable  $64,449   $31,027 
Accrued expenses and other payables   14,860    34,467 
Net liabilities of discontinued operations   1,025,716    1,025,716 
Notes payable   3,000    3,000 
Total Current Liabilities   1,108,025    1,094,210 
           
Stockholders' Equity          
Series A-1 Convertible Preferred stock, $0.01 par value; 5,000,000 shares designated, 3,137,500 shares issued and outstanding. (liquidation preference $251,000)   3,138    3,138 
Series B Convertible, Redeemable Preferred Stock, $0.001 par value; 500,000 shares designated; 40,000 issued and outstanding. (liquidation preference $480,000 )   40    40 
Series C Convertible, Preferred Stock, $0.001 par value, 4,500,000 shares designated, 4,500,000 issued and outstanding (liquidation preference $14,750,000)   4,500    4,500 
Common stock, $0.001 par value; 500,000,000 shares authorized, 268,558,931 shares issued and outstanding.   268,559    268,559 
Additional paid-in-capital   26,377,580    26,359,514 
Accumulated deficit   (18,975,627)   (18,512,441)
Total Stockholders' Equity   7,678,190    8,123,310 
Total Liabilities and Stockholders' Equity  $8,786,215   $9,217,520 

 

See notes to the unaudited condensed consolidated financial statements

 

 F-1 

 

 

PLEDGE PETROLEUM CORP.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

 

   Three months
ended
   Three months
ended
   Nine months
ended
   Nine months
ended
 
   September 30   September 30   September 30   September 30 
   2017   2016   2017   2016 
                 
Net Revenue  $-   $-   $25,000   $- 
                     
Cost of Goods Sold   -    -    -    - 
                     
Gross Profit  $-   $-   $25,000   $- 
                     
Sales and Marketing   1,497    (196)   4,491    6,569 
Professional fees   73,887    140,616    222,249    310,173 
Business development   -    3,079    -    22,181 
Consulting fees   6,800    43,986    34,236    287,086 
General and administrative   53,076    258,952    223,558    894,807 
Depreciation, amortization and impairment charges   1,263    66,271    4,128    134,553 
Total Expense   136,523    512,708    488,662    1,655,369 
Loss from Operations   (136,523)   (512,708)   (463,662)   (1,655,369)
                     
Other income   -    4,059    -    203,296 
Finance costs   432    -    476    - 
Loss before Provision for Income Taxes   (136,091)   (508,649)   (463,186)   (1,452,073)
                     
Provision for Income Taxes   -    -    -    - 
                     
Net Loss from continuing operations   (136,091)   (508,649)   (463,186)   (1,452,073)
                     
Loss for discontinued operations, net of tax   -    (363,421)   -    (1,428,157)
Net loss attributable to non-controlling interest of discontinued operation   -    -    -    249,339 
                     
Loss from discontinued operations, net of non-controlling interest   -    (363,421)   -    (1,178,818)
                     
Net Loss Attributable to Controlling Interest   (136,091)   (872,070)   (463,186)   (2,630,891)
                     
Undeclared Series B and Series C Preferred stock dividends   (157,786)   (157,786)   (468,214)   (469,928)
                     
Net loss available to common stock holders  $(293,877)  $(1,029,856)  $(931,400)  $(3,100,819)
                     
Net Loss Per Share from continuing operations -  Basic and Diluted  $-   $-   $-   $(0.01)
Net Loss Per Share from discontinued operations -  Basic and Diluted  $-   $-   $-   $- 
Net Loss Per Share -  Basic and Diluted  $-   $-   $-   $(0.01)
Weighted Average Number of Shares Outstanding - Basic and Diluted   268,558,931    268,558,931    268,558,931    268,558,931 

 

See notes to the unaudited condensed consolidated financial statements

 

 F-2 

 

 

PLEDGE PETROLEUM CORP.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 

   Nine months
ended
   Nine months
ended
 
   September 30   September 30 
   2017   2016 
CASH FLOWS FROM OPERATING ACTIVITIES:          
Net loss   (463,186)  $(2,630,891)
Net loss from discontinued operations   -   $1,428,157 
Less: loss attributable to non-controlling interest   -    (249,339)
Net loss from continuing operations   (463,186)   (1,452,073)
Adjustment to reconcile net loss to net cash used in operating activities:          
Depreciation expense   4,128    82,053 
Deposit forfeited   6,968    - 
Amortization expense   -    52,500 
Loss on scrapping of fixed assets   -    1,248 
Equity based compensation charge   18,066    66,035 
Gain on debt forgiven   -    (200,000)
Changes in Assets and Liabilities          
Accounts receivable   -    (3,400)
Prepaid expenses and other current assets   6,257    29,241 
Accounts payable   33,629    (41,702)
Accrued liabilities   (19,815)   (31,109)
Cash Used  in Operating Activities - continuing operations   (413,953)   (1,497,207)
Cash used in operating activities - discontinued operations   -    (470,842)
    (413,953)   (1,968,049)
CASH FLOWS FROM INVESTING ACTIVITIES:          
Purchase of property and equipment   -    (200,899)
Investment in deposit   (530)   (6,968)
Cash used in investing activities - continuing operations   (530)   (207,867)
Cash used in investing activities - discontinued operations   -    (4,782)
    (530)   (212,649)
           
NET INCREASE IN CASH   (414,483)   (2,180,698)
CASH AT BEGINNING OF PERIOD  $9,170,286   $11,700,143 
CASH AT END OF PERIOD  $8,755,803   $9,519,445 
           
CASH PAID FOR INTEREST AND TAXES:          
Cash paid for income taxes  $-   $- 
Cash paid for interest  $-   $48,130 

 

See notes to the unaudited condensed consolidated financial statements

 

 F-3 

 

 

PLEDGE PETROLEUM CORP.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

  

1ACCOUNTING POLICIES AND ESTIMATES

 

a)Basis of Presentation

 

The accompanying unaudited condensed financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X. Accordingly, these unaudited condensed financial statements do not include all of the information and disclosures required by U.S. GAAP for complete financial statements. In the opinion of management, the accompanying unaudited condensed financial statements include all adjustments (consisting only of normal recurring adjustments), which we consider necessary, for a fair presentation of those financial statements. The results of operations and cash flows for the three months and nine months ended September 30, 2017 may not necessarily be indicative of results that may be expected for any succeeding quarter or for the entire fiscal year. The information contained in this quarterly report on Form 10-Q should be read in conjunction with our audited financial statements included in our annual report on Form 10-K as of and for the year ended December 31, 2016 as filed with the Securities and Exchange Commission (the “SEC”).

 

Significant accounting policies are described in Note 2 to the consolidated financial statements included in Item 8 of our annual report on Form 10-K as of December 31, 2016.

 

The preparation of unaudited consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions, which are evaluated on an ongoing basis, that affect the amounts reported in the unaudited consolidated financial statements and accompanying notes. Management bases its estimates on historical experience and on various other assumptions that it believes are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the amounts of revenues and expenses that are not readily apparent from other sources. Actual results could differ from those estimates and judgments. In particular, significant estimates and judgments include those related to: the estimated useful lives for plant and equipment, the fair value of warrants and stock options granted for services or compensation, estimates of the probability and potential magnitude of contingent liabilities, derivative liabilities, the valuation allowance for deferred tax assets due to continuing operating losses, those related to revenue recognition and the allowance for doubtful accounts.

 

Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the unaudited consolidated financial statements, which management considered in formulating its estimate could change in the near-term due to one or more future confirming events. Accordingly, the actual results could differ significantly from our estimates.

 

All amounts referred to in the notes to the unaudited consolidated financial statements are in United States Dollars ($) unless stated otherwise.

 

  b) Principles of Consolidation

 

The unaudited consolidated financial statements include the financial statements of the Company and its subsidiaries in which it has a majority voting interest. All significant inter-company accounts and transactions have been eliminated in the unaudited consolidated financial statements. The entities included in these unaudited consolidated financial statements are as follows:

 

Pledge Petroleum Corp (formerly Propell Technologies Group, Inc.) – Parent Company

Novas Energy USA Inc. (wholly owned)

Novas Energy North America, LLC (60% owned) – Discontinued operation.

 

 F-4 

 

 

PLEDGE PETROLEUM CORP.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

  

1ACCOUNTING POLICIES AND ESTIMATES (continued)

 

  c) Recent Accounting Pronouncements

 

In July 2017, the FASB issued Accounting Standards Update No. (“ASU’’) 2017-11, Earnings Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480) and Derivatives and Hedging (Topic 815). The amendments in this Update provide guidance about:

 

1.Accounting for certain financial instruments with down round features

 

2.Replacement of the indefinite deferral for mandatorily redeemable financial instruments of certain non-public entities and certain non-controlling interests

 

The amendments in Part I of this Update change the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. The amendments also clarify existing disclosure requirements for equity-classified instruments. As a result, a freestanding equity-linked financial instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. For freestanding equity classified financial instruments, the amendments require entities that present earnings per share (EPS) in accordance with Topic 260 to recognize the effect of the down round feature when it is triggered. That effect is treated as a dividend and as a reduction of income available to common shareholders in basic EPS. Convertible instruments with embedded conversion options that have down round features are now subject to the specialized guidance for contingent beneficial conversion features (in Subtopic 470-20, Debt—Debt with Conversion and Other Options), including related EPS guidance (in Topic 260).

 

The amendments in Part II of this Update recharacterize the indefinite deferral of certain provisions of Topic 480 that now are presented as pending content in the Codification, to a scope exception. Those amendments do not have an accounting effect.

 

The amendments in Part I of this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted for all entities, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. The amendments in Part 1 of this Update should be applied in either of the following ways: 1. Retrospectively to outstanding financial instruments with a down round feature by means of a cumulative-effect adjustment to the statement of financial position as of the beginning of the first fiscal year and interim period(s) in which the pending content that links to this paragraph is effective 2. Retrospectively to outstanding financial instruments with a down round feature for each prior reporting period presented in accordance with the guidance on accounting changes in paragraphs 250-10-45-5 through 45-10.

 

The amendments in Part II of this Update do not require any transition guidance because those amendments do not have an accounting effect.

 

 F-5 

 

 

PLEDGE PETROLEUM CORP.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

  

1 ACCOUNTING POLICIES AND ESTIMATES (continued)

 

  c) Recent Accounting Pronouncements (continued)

 

The Company is currently evaluating the impact this ASU will have on its consolidated financial In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging, an amendment to Topic 815. The amendments in this Update better align an entity’s risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. To meet that objective, the amendments expand and refine hedge accounting for both nonfinancial and financial risk components 2 and align the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. The amendments in this Update require an entity to present the earnings effect of the hedging instrument in the same income statement line item in which the earnings effect of the hedged item is reported.

 

The amendments in this Update are effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early application is permitted in any interim period after issuance of the Update. All transition requirements and elections should be applied to hedging relationships existing (that is, hedging relationships in which the hedging instrument has not expired, been sold, terminated, or exercised or the entity has not removed the designation of the hedging relationship) on the date of adoption. The effect of adoption should be reflected as of the beginning of the fiscal year of adoption. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements.

 

In September 2017, the FASB issued ASU 2017-13, Revenue Recognition (Topic 605), Revenue from Contracts with Customers (Topic 606), Leases (Topic 840), and Leases (Topic 842). The amendments in this ASU deals with the transition and effective dates of implementing to ASU 2014-09, Revenue from contracts with customers, ASU 2016-08, Revenue from contracts with customers, principal versus agent considerations, ASU 2016-10, revenues from contacts with customers; identifying performance obligations and licensing, ASU 2016-12, revenues from contacts with customers, narrow scope improvements and practical expedients, 2016-20, technical corrections and improvements and ASU 2017-05, other income, gains and losses from the derecognition of non-financial assets.

 

The transition provisions require adoption of Topic 606 for annual reporting periods commencing after December 15, 2017 and the adoption of Topic 842 for annual reporting periods beginning after December 15, 2018 for public business entities, if the requirements of a public business entity as defined in ASU 2017-122 are not met, may adopt Topic 606 for annual reporting periods commencing after December 15, 2018 and for Topic 842 for annual reporting periods commencing after December 15, 2019. Early adoption is permitted of both Topics. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements.

 

Any new accounting standards, not disclosed above, that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the financial statements upon adoption.

 

 F-6 

 

 

PLEDGE PETROLEUM CORP.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

  

1ACCOUNTING POLICIES AND ESTIMATES (continued)

 

  d) Use of Estimates

 

The preparation of unaudited consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions, which are evaluated on an ongoing basis, that affect the amounts reported in the unaudited consolidated financial statements and accompanying notes. Management bases its estimates on historical experience and on various other assumptions that it believes are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the amounts of revenues and expenses that are not readily apparent from other sources. Actual results could differ from those estimates and judgments. In particular, significant estimates and judgments include those related to: the estimated useful lives for plant and equipment, the fair value of warrants and stock options granted for services or compensation, estimates of the probability and potential magnitude of contingent liabilities, derivative liabilities, the valuation allowance for deferred tax assets due to continuing operating losses, those related to revenue recognition and the allowance for doubtful accounts.

 

Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the unaudited consolidated financial statements, which management considered in formulating its estimate could change in the near-term due to one or more future confirming events. Accordingly, the actual results could differ significantly from our estimates.

 

  e) Contingencies

 

Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company’s management assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment.

 

If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material would be disclosed. Loss contingencies considered to be remote by management are generally not disclosed unless they involve guarantees, in which case the guarantee would be disclosed.

  

  f) Cash and Cash Equivalents

 

The Company considers all highly liquid investments with original maturities of three months or less at the time of purchase to be cash equivalents. At September 30, 2017 and December 31, 2016, respectively, the Company had no cash equivalents.

 

The Company assesses credit risk associated with cash by periodically evaluating the credit quality of its primary financial institution. The balance at times may exceed federally insured limits. At September 30, 2017, the Company had cash balances of $8,755,803, which exceeded the federally insured limits by $8,450,408.

 

 F-7 

 

 

PLEDGE PETROLEUM CORP.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

  

1ACCOUNTING POLICIES AND ESTIMATES (continued)

 

  g) Related parties

 

Parties are considered to be related to the Company if the parties that, directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company, or own in aggregate, on a fully diluted basis 5% or more of the Company’s stock. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. The Company discloses all related party transactions. All transactions are recorded at fair value of the goods or services exchanged. Property purchased from a related party is recorded at the cost to the related party and any payment to or on behalf of the related party in excess of the cost is reflected as a distribution to related party.

 

  h) Reclassification

 

Certain reclassifications have been made to the prior year financial statement numbers to conform to the current presentation of the financial statements.

 

2GOING CONCERN

 

The Company has cash balances of $8,755,803 as of September 30, 2017, which is sufficient to meet current expenses for at least the next twelve month period, however the Board of Directors are considering various options as to the future direction of the Company, including the possible sale of its technology and PPT assets. The Company formed a special committee to investigate a possible share buyback of the majority stockholder, Ervington Investments Limited, and/or a possible dissolution of the Company.

 

Due to uncertainties surrounding the Company’s ability to realize the full value of its assets, the Company cannot make any assurances regarding the amount available for distribution to its stockholders.

 

The Company has made certain projections relating to the amount of cash it expects to have to distribute to its stockholders upon dissolution of the Company. These projections generally relate to the amount of liabilities which must be satisfied before the Company is dissolved and the amount its preferred stockholders is expected to receive for their equity interest. The above projections are subject to multiple variables, including the timing of a dissolution affecting the amount of dividends payable and the amount of liabilities owed at the time of dissolution. Based upon current estimates, if the Company were to dissolve this quarter, no assurance can be given that common stockholders or subordinate preferred stockholders will receive any such distribution.

 

3DISCONTINUED OPERATIONS

 

On October 4, 2016, Novas Energy USA, Inc. (“Novas USA”), a wholly owned subsidiary of the Company, delivered a notice to Technovita Technologies USA, Inc. (“Technovita”) electing to dissolve its joint venture with Technovita (the “Joint Venture”), effective November 1, 2016, pursuant to Section 11.1(b) of the Operating Agreement of Novas Energy North America, LLC (“NENA”), dated October 22, 2015 (the “Operating Agreement”), by and among Novas USA and Technovita.

 

 F-8 

 

 

PLEDGE PETROLEUM CORP.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

3DISCONTINUED OPERATIONS (continued)

 

The assets and liabilities of discontinued operations as of September 30, 2017 and December 31, 2016, respectively is as follows:

 

    September 30,
2017
    December 31,
2016
 
Current assets                
Cash   $ 19,480     $ 19,480  
Accounts receivable, net     61,661       61,661  
Prepaid expenses and other current assets     29,896       29,896  
Total current assets     111,037       111,037  
Non-current assets                
Plant and equipment, net     6,480       6,480  
Total assets     117,517       117,517  
                 
Current liabilities                
Accounts payable     94,784       94,784  
Related party payables     932,478       932,478  
Accrued liabilities and other payables     115,971       115,971  
Total liabilities     1,143,233       1,143,233  
Discontinued operations   $ 1,025,716     $ 1,025,716  

 

Loss from discontinued operations is as follows:

 

  

Three months
ended

September 30

2017

   Three months
ended
September 30,
2016
  

Nine months
ended

September 30,
2017

  

Nine months

ended
September 30,
2016

 
                 
Net revenue  $-   $48,560   $-   $196,328 
Cost of goods sold   -    13,017    -    139,950 
Gross profit   -    35,543    -    56,378 
                     
Sales and marketing expenses   -    848    -    11,729 
Professional fees   -    20,573    -    57,496 
Business development   -    -    -    145,319 
Consulting fees   -    230,268    -    802,460 
General and administrative expenses   -    137,340    -    457,876 
Depreciation and amortization   -    477    -    1,280 
Total expense   -    389,506    -    1,476,160 
                     
Loss from operations   -    (353,963)   -    (1,419,782)
                     
Loss on discontinuance of subsidiary   -    (9,377)   -    (9,377)
Foreign currency (losses) gains   -    (81)   -    992 
Other income   -    -    -    10 
                     
Loss from discontinued operations  $-   $(363,421)  $-   $1,428,157 

 

 F-9 

 

 

PLEDGE PETROLEUM CORP.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

4PREPAID EXPENSES

 

Prepaid expenses consisted of the following:

 

    September 30,
2017
    December 31,
2016
 
             
Prepaid insurance   $ 13,851     $ 22,607  
Prepaid professional fees     5,833       3,333  
    $ 19,684     $ 25,940  

 

5PLANT AND EQUIPMENT

 

Plant and Equipment consisted of the following:

 

   September 30,
2017
   December 31,
2016
 
   Cost   Amortization
and Impairment
   Net book value   Net book value 
                 
Plasma pulse tool  $945,423   $(945,423)  $-   $- 
Furniture and equipment   6,700    (2,122)   4,578    5,583 
Field equipment   19,627    (19,627)   -    341 
Computer equipment   11,130    (5,510)   5,620    8,402 
                     
   $982,880   $(972,682)  $10,198   $14,326 

 

Depreciation expense was $4,128 and $82,053 for the nine months ended September 30, 2017 and 2016, respectively.

 

6INTANGIBLES

 

Licenses

 

Novas licenses the “Plasma-Pulse Technology” (“the Technology”) from Novas Energy Group Limited, the Licensor, pursuant to the terms of an exclusive perpetual royalty bearing license it entered into in January 2013, which was amended during March 2014.

 

On July 19, 2016, the Company received a notice from Licensor purporting to effectively terminate the License Agreement for non-payment of required royalties, asserting, among other things, that as of June 30, 2016, Novas owed Licensor a pro rata amount of $1,458,333 for the Licensed Plasma Pulse Technology for the United States and Mexico, of which $1,000,000 was alleged to be in arrears. Novas has recently been contacted by Licensor with a request for settlement discussions; however, there can be no assurance that such discussions will occur or what the outcome of any such discussions will be. The Company and Novas believe that there is no legal basis for Licensor to terminate the License Agreement and intend to vigorously defend against any attempt by Licensor to enforce a termination of the License Agreement. Further, we believe that Licensor has failed to materially perform its obligations under the License Agreement, and that such failures on Licensor’s part may impact what, if any, payments are due under the License Agreement by Novas to Licensor.

 

 F-10 

 

 

PLEDGE PETROLEUM CORP.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

6INTANGIBLES (continued)

 

On October 4, 2016, Novas Energy USA, Inc. (“Novas USA”), a wholly owned subsidiary of the Company, delivered a notice to Technovita Technologies USA, Inc. (“Technovita”) electing to dissolve its joint venture with Technovita (the “Joint Venture”), effective November 1, 2016, pursuant to Section 11.1(b) of the Operating Agreement of Novas Energy North America, LLC (“NENA”), dated October 22, 2015 (the “Operating Agreement”), by and among Novas USA and Technovita.

 

Pursuant to the Operating Agreement, Novas USA had entered into a sublicense agreement (the “Novas Sublicense Agreement”) with NENA and Novas Energy Group Limited for NENA to be the exclusive provider of Plasma Pulse Technology for treatment of vertical wells to third parties in the United States. The Sublicense Agreement was terminated upon termination of the Joint Venture.

 

Intangibles consisted of the following:

 

   September 30,
2017
   December 31,
2016
 
   Cost   Amortization
and Impairment
   Net book value   Net book value 
                 
License agreements  $350,000   $(350,000)  $-   $- 
Website development   8,000    (8,000)   -    - 
                     
   $358,000   $(358,000)  $-   $- 

 

Amortization expense was $0 and $52,500 for the nine months ended September 30, 2017 and 2016, respectively.

 

7ACCRUED LIABILITIES AND OTHER PAYABLES

 

Accrued liabilities consisted of the following:

 

   September 30,
2017
   December 31,
2016
 
         
Royalties payable  $14,653   $14,653 
Other   207    - 
Severance accrual   -    19,814 
   $14,860   $34,467 

 

The severance accrual relates to accrued severance costs due to the COO, whose employment with the Company was terminated on December 15, 2016 as part of a cost reduction exercise.

 

8STOCKHOLDERS’ EQUITY

 

a)Preferred stock

 

i)Series B Convertible Preferred Stock

 

The Company has undeclared dividends on the Series B Preferred stock amounting to $154,553 as of September 30, 2017. If the dividends are paid in stock, the beneficial conversion feature of these undeclared dividends will be recorded upon the declaration of these dividends. The computation of loss per common share for the nine months ended September 30, 2017 takes into account these undeclared dividends.

 

 F-11 

 

 

PLEDGE PETROLEUM CORP.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INANCIAL STATEMENTS

 

8STOCKHOLDERS’ EQUITY (continued)

 

a)Preferred stock (continued)

 

ii)Series C Convertible Preferred Stock

 

The Company has undeclared dividends on the Series C Preferred stock amounting to $1,402,110 as of September 30, 2017. The computation of loss per common share for the nine months ended September 30, 2017 takes into account these undeclared dividends.

 

b)Stock Options

 

i)Plan options

 

At September 30, 2017 and December 31, 2016 there were 380,950 Plan options issued and outstanding, respectively, under the Stock Option Plan.

 

No options were issued during the nine months ended September 30, 2017 and the year ended December 31, 2016.

  

ii)Non-Plan Stock Options

 

On January 1, 2016, the Company granted, to its then Chief Executive Officer, non - plan options for 3,000,000 shares of common stock (that are not covered by the Company’s Stock Option Plan), with an exercise price of $0.08 per share and which options will expire thirty days after resignation. These options vested as to 1,000,000 on January 1, 2017, the first anniversary of the grant date; 1,000,000 was due to vest on the second anniversary of the grant date and a further 1,000,000 was due to vest on the third anniversary of the grant date.

 

On March 31, 2017, the Chief Executive Officer, Mr. Brian Boutte tendered his resignation and the remaining unvested options for 2,000,000 shares of common stock were cancelled. The 1,000,000 options which vested on January 1, 2017, were not exercised within 30 days of resignation by Mr. Boutte and have been forfeited.

 

A summary of all of our option activity during the period January 1, 2016 to September 30, 2017 is as follows:

 

    No. of shares     Exercise price
per share
  Weighted
average exercise
price
 
                 
Outstanding January 1, 2016     380,950     $0.08 to $13.50   $ 0.18  
Granted     4,000,000     $0.08 to $0.09     0.09  
Forfeited/cancelled     (1,000,000 )   $0.08     0.08  
Exercised     -     -     -  
Outstanding December 31, 2016     3,380,950     $0.09 to $13.50   $ 0.18  
Granted - non-plan options     -     -     -  
Forfeited/cancelled     (3,000,000 )   $0.08     0.08  
Exercised     -     -     -  
Outstanding September 30, 2017     380,950     $0.51 to $13.50   $ 0.90  

 

Stock options outstanding as of September 30, 2017 and December 31, 2016 as disclosed in the above table, have an intrinsic value of $0 and $0, respectively.

 

 F-12 

 

 

PLEDGE PETROLEUM CORP.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

8STOCKHOLDERS’ EQUITY (continued)

 

b)Stock Options (continued)

 

The options outstanding and exercisable at September 30, 2017 are as follows:

 

      Options outstanding     Options exercisable  
Exercise price     No. of shares     Weighted
average
remaining years
    Weighted
average exercise
price
    No. of shares     Weighted
average exercise
price
 
                                             
$ 13.50       3,480       1.71               3,480          
$ 12.50       2,000       3.03               2,000          
$ 8.50       500       3.75               500          
$ 5.00       14,800       4.04               14,800          
$ 0.65       36,924       5.50               36,924          
$ 0.63       38,096       0.75               38,096          
$ 0.51       285,150       2.54               285,150          
                                             
          380,950       2.70       0.90       380,950       0.90  

 

The Company has recorded an expense of $18,066 and $66,035 for the nine months ended September 30, 2017 and 2016, respectively relating to options issued.

 

  c) Warrants

 

The warrants outstanding and exercisable at September 30, 2017 are as follows:

 

      Warrants outstanding     Warrants exercisable  
Exercise price     No. of shares     Weighted
average
remaining years
    Weighted
average exercise
price
    No. of shares     Weighted
average
exercise price
 
                                             
$ 0.30       375,000       1.08               375,000          
$ 0.25       1,751,667       1.74               1,751,667          
$ 0.15       525,500       1.74               525,500          
$ 0.25       1,508,333       1.84               1,508,333          
$ 0.15       577,499       1.85               577,499          
$ 0.25       968,166       1.85               968,166          
$ 0.25       633,333       1.90               633,333          
                                             
          6,339,498       1.77       0.24       6,339,498       0.24  

 

The warrants outstanding have an intrinsic value of $0 and $0 as of September 30, 2017 and December 31, 2016, respectively.

 

 F-13 

 

 

PLEDGE PETROLEUM CORP.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

9OTHER INCOME

 

    Three
months
ended 30
September 2017
    Three
months
ended 30
September 2016
 

Nine months

ended
September 30, 
2017

   

Nine months

ended
September 30, 
2016

 
                           
Other income -   $ 4,059   $ -     $ 203,296  

 

Other income in the prior period includes the forgiveness of the $200,000 license fee due to Novas BVI during the prior period.

 

10 NET LOSS PER SHARE

 

Basic loss per share is based on the weighted-average number of common shares outstanding during each period. Diluted loss per share is based on basic shares as determined above plus common stock equivalents, including convertible preferred shares and convertible notes as well as the incremental shares that would be issued upon the assumed exercise of in-the-money stock options using the treasury stock method. The computation of diluted net loss per share does not assume the issuance of common shares that have an anti-dilutive effect on net loss per share. For the nine months ended September 30, 2017 and 2016, all stock options, warrants and convertible preferred stock were excluded from the computation of diluted net loss per share. Dilutive shares which could exist pursuant to the exercise of outstanding stock instruments and which were not included in the calculation because their affect would have been anti-dilutive are as follows:

 

   

Three and Nine

months

ended
September 30,
2017

   

Three and Nine

months

ended
September 30,
2016

 
             
Stock options     380,950       4,380,950  
Warrants to purchase shares of common stock     6,339,498       6,339,498  
Series A-1 convertible preferred shares     31,375,000       31,375,000  
Series B convertible preferred shares     4,000,000       4,000,000  
Series C convertible preferred shares     120,000,000       120,000,000  
      162,095,448       166,095,448  

 

 F-14 

 

 

PLEDGE PETROLEUM CORP.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

11RELATED PARTY TRANSACTIONS

 

On January 1, 2016, the “Company entered into a three-year Employment Agreement with C. Brian Boutte (the “Boutte Employment Agreement”) to serve as the Company’s Chief Executive Officer. Mr. Boutte was to also serve as the Company’s interim Chief Financial Officer. Under the Boutte Employment Agreement, for his service as the Chief Executive Officer of the Company, Mr. Boutte was to receive an annual base salary of $265,000, a sign on bonus of $60,000 and an annual performance bonus of up to 55% of his base salary, such bonus payable in cash or equity upon attainment of certain performance indicators established by the Company’s Board of Directors and Mr. Boutte. In connection with the entry into the Boutte Employment Agreement, Mr. Boutte was granted an option award exercisable for 3,000,000 shares of the Company’s common stock, which will vest as to 1,000,000 shares on each of the one, two and three-year anniversary of the commencement of his employment with the Company. The Boutte Employment Agreement was amended on December 31, 2016 to provide for a term of six months ending June 30, 2017, a reduced annual base salary of $165,000 and a provision for immediate vesting of the options upon a Change of Control (as defined in the amendment). In the event that Mr. Boutte’s employment was terminated Without Cause (as defined in the Boutte Employment Agreement), by Mr. Boutte for Good Reason (as defined below), Disability (as defined in the Boutte Employment Agreement), upon his death or a change in control, Mr. Boutte would be entitled to receive a severance payment equal to $65,000. Upon a change in control, Mr. Boutte’s options would immediately vest. The Boutte Employment Agreement also included customary confidentiality obligations and inventions assignments by Mr. Boutte as well as a non- compete and non-solicitation provision. If his employment was terminated for Cause (as defined below) or by him Without Good Reason (as defined in the Boutte Employment Agreement), Mr. Boutte was entitled to receive his annual base salary through the date of termination and any bonus earned but unpaid. For purposes of the Boutte Employment Agreement, “Good Reason” is defined as (i) any material and substantial breach of the Boutte Employment Agreement by the Company; (ii) a Change in Control (as defined in the Boutte Employment Agreement) occurs and Mr. Boutte’s employment is terminated; (iii) a reduction in Mr. Boutte’s Annual Base Salary as in effect at the time in question, or any other failure by the Company to comply with the compensation terms of the Boutte Employment Agreement; or (iv) the Boutte Employment Agreement is not assumed by a successor to the Company. For purpose of the Boutte Employment Agreement, “Cause” is defined as (i) acts of embezzlement or misappropriation of funds or fraud; (ii) conviction of a felony or other crime involving moral turpitude, dishonesty or theft; (iii) a material violation by Mr. Boutte of any provision of the Boutte Employment Agreement, including willful failure to perform assigned tasks, willful and unauthorized disclosure of Company material confidential information; (iv) being under the influence of drugs (other than prescription medicine or other medically related drugs to the extent that they are taken in accordance with their directions) during the performance of Mr. Boutte’s duties and that performance of his duties is affected; (v) engaging in behavior that would constitute grounds for liability for harassment (as proscribed by the U.S. Equal Employment Opportunity Commission Guidelines or any other applicable state or local regulatory body) or other egregious conduct that violates laws governing the workplace; or (vi) willful failure to perform his assigned tasks, where such failure is attributable to the fault of Mr. Boutte, gross insubordination or dereliction of fiduciary obligations which, to the extent it is curable by Mr. Boutte, is not cured by Mr. Boutte within thirty (30) days of receiving written notice of such violation by the Company.

 

Mr. Boutte tendered his resignation to the Board of Directors on March 31, 2017.

 

12COMMITMENTS AND CONTINGENCIES

 

The Company disposed of its Crystal Magic, Inc. subsidiary effective December 31, 2013. In terms of the sale agreement entered into by the Company, the purchaser has been indemnified against all liabilities whether contingent or otherwise, claimed by third parties, this includes claims by creditors of the Company amounting to $372,090 and claims against long-term liabilities of $848,916. Management does not consider it likely that these claims will materialize and accordingly no provision has been made for these contingent liabilities.

 

 F-15 

 

 

 

PLEDGE PETROLEUM CORP.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

12COMMITMENTS AND CONTINGENCIES (continued)

 

The Company entered into a lease agreement for approximately 3,733 square feet of office and warehouse space in Houston, the term of the lease was for 39 months commencing on March 1, 2016 and terminating on May 31, 2019. The lease provided for the first month to be rent free, the fourteenth month to be rent free and the twenty-seventh month to be rent free. Monthly rentals, including estimated operating costs, for the first 12 months, excluding the free rental month amounted to approximately $3,410 per month, escalating at a rate of 1.7% per annum, after excluding the free rental months. This lease agreement was amended, and the lease terminated with effect from May 31, 2017 with a final payment of $2,000 and the forfeiture of the security deposit of $6,968.

 

The Company entered into an Office Service Agreement on May 16, 2017 whereby it has the license to use an office in a business center, together with all telecommunication services and access to conference rooms, kitchens and all utilities, the agreement is for a period of six months commencing on June 1, 2017 and terminating on November 30, 2017. The Company pays a monthly amount of $530 in terms of the Office Service Agreement.

 

In terms of the license agreement commitments disclosed in note 6 above, the minimum commitments due under the amended license agreement entered into on January 30, 2013, for the next five years, are summarized as follows:

 

   Amount 
     
2017  $500,000 
2018   500,000 
2019   500,000 
2020   500,000 
2021   500,000 
Total  $2,500,000 

  

13SUBSEQUENT EVENTS

 

The Company has entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”) with an affiliate (the “Purchaser”) of Ervington Investment Limited (“Ervington”), the current holder of a majority of the Company’s outstanding voting securities, pursuant to which the Company has agreed to sell to the Purchaser substantially all of its assets, including all pertinent intellectual property rights, comprising its business of implementing its plasma pulse technology, for $650,000 (the “Asset Sale”).  The Asset Purchase Agreement provides, among other things, that the Asset Sale is conditioned on its approval by holders of a majority of the Company’s voting securities, exclusive of the securities held by Ervington (a “majority of the minority”).

 

The Company has also entered into an agreement with Ervington (the “Share Repurchase Agreement”) to repurchase all of its outstanding securities held by Ervington for $8,500,000 (the “Share Repurchase”), which repurchase will occur at the same time as the Asset Sale.  The repurchase will constitute a change of control and upon consummation of the repurchase, Ivan Persiyanov, will resign from all positions he holds as an officer and director of the Company and its subsidiaries. After the completion of the Asset Sale, the Company expects to cease all activities related to its existing business while evaluating other business opportunities, which include potentially acquiring an oilfield services business, of which two of the Company’s current directors (Messrs. Huemoeller and Zotos) own a minority equity interest. The Company has not entered into an agreement with any potential acquisition candidate and has only been in the early stages of discussion.

 

The purchase price for the shares being repurchased and assets being sold together with documents necessary to effect the Asset Sale pursuant to the Asset Purchase Agreement and the Share Repurchase pursuant to the Share Repurchase Agreement, including, but not limited to, a bill of sale for the assets being sold, an assignment of intellectual property rights, stock certificates and stock powers for the shares to be repurchased from Ervington, and the resignation of Ivan Persiyanov, have been placed in escrow pending the approval of the Asset Sale by a majority of the minority and will be released at the subsequent closing of the transactions contemplated by the Asset Purchase Agreement and Share Repurchase Agreement.

 

Other than disclosed above, in accordance with ASC 855-10, the Company has analyzed its operations subsequent to September 30, 2017 to the date these financial statements were issued, and has determined that it does not have any material subsequent events to disclose in these financial statements.

 

 F-16 

 

 

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

 

The following discussion and analysis is intended as a review of significant factors affecting our financial condition and results of operations for the periods indicated.  The discussion should be read in conjunction with our unaudited consolidated financial statements and the notes thereto presented herein and our audited consolidated financial statements and notes thereto for the year ended December 31, 2016 and the other information set forth in our Annual Report on Form 10-K for the year ended December 31, 2016 filed with the SEC on August 8, 2017. In addition to historical information, the following Management's Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements that involve risks and uncertainties. Our actual results could differ significantly from those anticipated in these forward-looking statements as a result of many factors including those discussed herein below, under Part II, Item 1A, “Risk Factors” and elsewhere herein, and those identified under Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2016.

 

Cautionary Note Regarding Forward-Looking Statements

 

This report and other documents that we file with the SEC contain forward-looking statements that are based on current expectations, estimates, forecasts and projections about our future performance, our business, our beliefs and our management’s assumptions. Statements that are not historical facts are forward-looking statements. Words such as “expect,” “outlook,” “forecast,” “would,” “could,” “should,” “project,” “intend,” “plan,” “continue,” “sustain”, “on track”, “believe,” “seek,” “estimate,” “anticipate,” “may,” “assume,” and variations of such words and similar expressions are often used to identify such forward-looking statements, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are not guarantees of future performance and involve risks, assumptions and uncertainties, including, but not limited to, those described in this Quarterly Report on Form 10-Q and other reports that we file or furnish with the SEC. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated or anticipated by such forward-looking statements. Accordingly, you are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date they are made. Except to the extent required by law, we undertake no obligation to update publicly any forward-looking statements after the date they are made, whether as a result of new information, future events, changes in assumptions or otherwise.

 

Overview and Financial Condition

 

Recent Developments

 

We have entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”) with an affiliate (the “Purchaser”) of Ervington Investment Limited (“Ervington”), the current holder of a majority of our outstanding voting securities, pursuant to which we have agreed to sell to the Purchaser substantially all of our assets, including all pertinent intellectual property rights, comprising our business of implementing our plasma pulse technology, for $650,000 (the “Asset Sale”).  The Asset Purchase Agreement provides, among other things, that the Asset Sale is conditioned on its approval by holders of a majority of our voting securities, exclusive of the securities held by Ervington (a “majority of the minority”).

 

We have also entered into an agreement with Ervington (the “Share Repurchase Agreement”) to repurchase all of our outstanding securities held by Ervington for $8,500,000 (the “Share Repurchase”), which repurchase will occur at the same time as the Asset Sale.  The repurchase will constitute a change of control and upon consummation of the repurchase Ivan Persiyanov will resign from all positions he holds as an officer and director of our company and our subsidiaries. After the completion of the Asset Sale, we expect to cease all activities related to our existing business while evaluating other business opportunities, which include potentially acquiring an oilfield services business, of which two of our current directors (Messrs. Huemoeller and Zotos) own a minority equity interest. We have not entered into an agreement with any potential acquisition candidate and have only been in the early stages of discussion.

 

The purchase price for the shares being repurchased and assets being sold together with documents necessary to effect the Asset Sale pursuant to the Asset Purchase Agreement and the Share Repurchase pursuant to the Share Repurchase Agreement, including, but not limited to, a bill of sale for the assets being sold, an assignment of intellectual property rights, stock certificates and stock powers for the shares to be repurchased from Ervington, and the resignation of Ivan Persiyanov, have been placed in escrow pending the approval of the Asset Sale by a majority of the minority and will be released at the subsequent closing of the transactions contemplated by the Asset Purchase Agreement and Share Repurchase Agreement.

  

Our Company

 

Since July 2015, when we closed the final tranche of our private placement of the sale of our Series C Preferred Stock and raised an additional $9,750,000, we shifted our operational focus from being a direct provider of well services based upon plasma pulse technology to actively seeking to acquire producing oil fields to generate revenues and the development of untapped hydrocarbon reserves. As a result, in August 2015, our Board of Directors and shareholders approved through the formation of a joint venture, the exclusive sublicense to our majority owned subsidiary Novas Energy North America, LLC (“NENA”) of our rights to use certain plasma pulse technology that we had licensed from Novas Energy Group Limited (the “Licensor”) pursuant to the terms of an exclusive license agreement (the “License Agreement”), for treatment of vertical wells in the United States (hereafter, the “Licensed Plasma Pulse Technology”). We retained the right to use the Licensed Plasma Pulse Technology for treatment of our own assets located in the United States as well as treatment of assets outside of the United States. The Licensed Plasma Pulse Technology refers to the process and apparatus of Licensor for its plasma pulse technology as covered by Licensor’s patent rights. Although we were indirectly engaged in the oil recovery business through NENA and directly through our treatment of oil wells in Mexico, it was not our foundational business strategy. In October 2016, we terminated the joint venture due to its failure to meet certain milestones. including its generation of minimal revenue.

 

During the past year, our management, at the direction of the Board of Directors, has evaluated, considered, and brought forward various opportunities to acquire producing oil fields; however, to date, an oil field meeting the criteria acceptable to the Board of Directors (which criteria include among other things, low general and administrative costs, ability to generate cash flow and ability to fully utilize the PPT) has not been found.   At this point, the Board is reevaluating its business plan and strategy and has reduced operating expenses, including staffing, in order to preserve capital, while the Board evaluates its options including the possible sale of our technology and PPT assets. A special committee of the Board of Directors has been formed to review and evaluate a potential sale of the Company’s assets and the potential purchase of the Company’s securities held by Ervington Investments Limited, and/or a possible dissolution of the Company.

 

 3 

 

 

We have financed our operations primarily from sales of our securities, both debt and equity, and to a lesser extent revenue from operations and we expect to continue to obtain required capital in a similar manner. We have incurred an accumulated deficit of $18,975,627 through September 30, 2017 and there can be no assurance that we will be able to achieve profitability.

 

Management Discussion and Analysis of financial condition

 

Our discussion and analysis of our financial condition and results of operations are based upon our unaudited consolidated financial statement as of September 30, 2017 and 2016, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of any contingent liabilities at the financial statement date and reported amounts of revenue and expenses during the reporting period. On an on-going basis we review our estimates and assumptions. Our estimates are based on our historical experience and other assumptions that we believe to be reasonable under the circumstances. Actual results are likely to differ from those estimates under different assumptions or conditions.

 

Results of Operations for the three months ended September 30, 2017 and September 30, 2016

 

Net revenues

Net revenues were $0 for the three months ended September 30, 2017 and 2016. All of our operations were directed through our 60% held joint venture, Novas Energy North America, LLC. (“NENA”). Effective November 1, 2016 we discontinued our NENA joint venture and the NENA operations are reflected in loss from discontinued operations, net of non-controlling interest.

 

Cost of goods sold

Cost of goods sold was $0 for the three months ended September 30, 2017 and 2016. All cost of goods sold related to our operations are reflected in loss from discontinued operations, net of non-controlling interest.

 

Gross profit

Gross profit was $0 for the three months ended September 30, 2017 and 2016.

 

Total expenses

Total expenses were $136,523 and $512,708 for the three months ended September 30, 2017 and 2016, respectively, a decrease of $376,185 or 73.4%. Total expenses consisted primarily of the following:

 

·Professional fees were $73,887 and $140,616 for the three months ended September 30, 2017 and 2016, respectively, a decrease of $66,729 or 47.5%. The decrease is primarily due to; (i) a reduction in legal fees of $61,569 due to a decrease in business activity; (ii) a reduction in secretarial fees of $15,000 due to management’s efforts to reduce operating expenses; offset by an increase in accounting and audit related fees of $12,487 due to the accrual of the 2016 annual audit fee and additional expenses during the current period.

 

  · Consulting fees were $6,800 and $43,986 for the three months ended September 30, 2017 and 2016, respectively, a decrease of $37,186 or 84.5%. The decrease is primarily due to a decrease in merger and acquisition related consulting expenses of $12,986; and ii) a decrease in finance management consulting expenses of $30,000 due to lower activity during the current period.

 

  · General and administrative expenses were $53,076 and $258,952 for the three months ended September 30, 2017 and 2016, respectively, a decrease of $205,876 or 79.5%. The decrease primarily consists of the following; (i) a reduction in payroll expenses of $147,865 due to the rationalization of staff during the December 2016 quarter; ii) a reduction in investor relations expenditure of $8,298 due to a rationalization exercise undertaken by the Board of Directors; and iii) a reduction in stock based compensation of $23,139 as all options are either vested or forfeited.

 

  · Depreciation, and amortization and impairment charges was $1,263 and $66,271 for the three months ended September 30, 2017 and 2016, respectively, a decrease of $65,008 or 98.1%. The plasma pulse tool asset and the intangible license fees were impaired during the fourth quarter of 2016 due to the uncertainty facing the business, the remaining assets consist of minor office related items.

  

 4 

 

 

Other income

Other income was $0 and $4,059 for the three months ended September 30, 2017 and 2016, respectively, a decrease of $4,059 or 100.0%. The amount in the prior period represented a reimbursement for travel expenditure on our Mexican project.

 

Net loss from continuing operations

We incurred a net loss from continuing operations of $136,091 and $508,649, for the three months ended September 30, 2017 and 2016, respectively, a decrease of $372,558 or 73.2%, which consists primarily of the reduction in total expenses of $376,185.

 

Loss from discontinued operations, net of tax

We incurred a loss from discontinued operations of $0 and $363,421 for the three months ended September 30, 2017 and 2016, respectively, a decrease of $363,421 or 100.0%, due to the termination of the joint venture agreement in November 2016 as it was unable to meet its operating milestones.

 

Net loss attributable to controlling interest

The loss attributable to controlling interest was $136,091 and $872,070 for the three months ended September 30, 2017 and 2016, respectively, a decrease of $735,979 or 84.4%. The decreased loss is primarily due to the reduction in total expenses and the losses incurred by the joint venture in the prior period.

 

Undeclared Series B and Series C preferred stock dividends

A deemed preferred stock dividend of $157,786 and $157,786 has been disclosed for the three months ended September 30, 2017 and 2016. This amount represents the dividends that are due, but remain undeclared, to Series B and Series C preferred stock holders.

 

Net loss available to common stockholders

We incurred a net loss available to common stockholders of $293,877 and $1,029,856 for the three months ended September 30, 2017 and 2016, respectively, a decrease of $735,979 or 71.5% which consists of the various items discussed above.

 

Results of Operations for the nine months ended September 30, 2017 and September 30, 2016

 

Net revenues

Net revenues were $25,000 and $0 for the nine months ended September 30, 2017 and 2016, respectively. The revenue during the current period represents revenue from one well treatment in Mexico. Other than the treatment of one well in Mexico, all of our operations were directed through our 60% held joint venture, Novas Energy North America, LLC. (“NENA”). Effective November 1, 2016 we discontinued our NENA joint venture and the NENA operations are reflected in loss from discontinued operations, net of non-controlling interest.

 

Cost of goods sold

Cost of goods sold was $0 for the nine months ended September 30, 2017 and 2016. All cost of goods sold related to our operations are reflected in loss from discontinued operations, net of non-controlling interest.

 

Gross profit

Gross profit was $25,000 for the nine months ended September 30, 2017 and $0 for the nine months ended September 30, 2016 due to the revenue earned on the Mexican well treatments.

 

Total expenses

Total expenses were $488,662 and $1,655,369 for the nine months ended September 30, 2017 and 2016, respectively, a decrease of $1,166,707 or 70.5%. Total expenses consisted primarily of the following:

 

 5 

 

 

  · Professional fees were $222,249 and $310,173 for the nine months ended September 30, 2017 and 2016, respectively, a decrease of $87,924 or 28.3%. The decrease is primarily due to; i) a reduction in SEC related printing costs of $9,219 due to the delay in filing the 2016 10-K; ii) a reduction in legal fees of $80,715 due to lower corporate activity; and iii) a reduction in corporate secretarial fees of $26,875 due to management's efforts to reduce operating expenses, offset by iv) an increase in accounting and audit fees of $36,543 due to the timing of the 2016 audit which was delayed during the current period and additional fees incurred on completing that audit; and v) the allocation of $30,000 of professional fees to this expense category which was previously included under management consulting expenses.

  

  · Consulting fees were $34,236 and $287,086 for the nine months ended September 30, 2017 and 2016, respectively, a decrease of $252,850 or 88.1%. The decrease is primarily due to; i) a decrease in merger and acquisition related consulting expenses of $156,685; and ii) a decrease in finance management consulting expenses of $108,000 due to lower activity during the current period.

 

  · General and administrative expenses were $223,558 and $894,807 for the nine months ended September 30, 2017 and 2016, respectively, a decrease of $671,249 or 75.0%. The decrease primarily consists of the following; i) a reduction in payroll expenses of $407,772 due to the rationalization of staff during the December 2016 quarter; ii) a reduction in investor relations expenditure of $115,681 due to a rationalization exercise undertaken by the Board of Directors; iii) a reduction in stock based compensation expense of $47,969 due to options forfeited or fully vested during the current period; and iv) a reduction in travel expenses of $28,454 as operations were curtailed and rationalized under the direction of the Board.

 

  · Depreciation, and amortization and impairment charges was $4,128 and $134,553 for the nine months ended September 30, 2017 and 2016, respectively, a decrease of $130,425 or 96.9%. The plasma pulse tool asset and the intangible license fees were impaired during the fourth quarter of 2016 due to the uncertainty facing the business, the remaining assets consist of minor office related items.

 

 6 

 

 

Other income

Other income was $0 and $203,296 for the nine months ended September 30, 2017 and 2016, respectively, a decrease of $203,296 or 100.0%, primarily due to the forgiveness of the once off license fee for the Mexican market of $200,000 in the prior period, which was due in June 2015.

 

Net loss from continuing operations

We incurred a net loss from continuing operations of $463,186 and $1,452,073 for the nine months ended September 30, 2017 and 2016, respectively, a decrease of $988,887 or 68.1%, which consists primarily of the reduction in total expenses of $1,166,707, offset by the forgiveness of the license fee income in the prior period as discussed above.

 

Loss from discontinued operations, net of tax

We incurred a loss from discontinued operations of $0 and $1,428,157 for the nine months ended September 30, 2017 and 2016, respectively, a decrease of $1,428,157 or 100.0%, due to the termination of the joint venture agreement in November 2016 as it was unable to meet its operating milestones.

 

Net loss attributable to non-controlling interest of discontinued operations

The net loss attributable to non-controlling interest of discontinued operations in the prior period of $249,339 is due to the losses in the Joint Venture being shared as to 40% by the non-controlling party until the full value of their investment of $600,000 was depleted.

 

Net loss attributable to controlling interest

The loss attributable to controlling interest was $463,186 and $2,630,891 for the nine months ended September 30, 2017 and 2016, respectively, a decrease of $2,167,705 or 82.4%. The decreased loss is primarily due to the reduction in total expenses and the losses incurred by the joint venture in the prior period offset by the forgiveness of the license fees due in the prior period.

 

Undeclared Series B and Series C preferred stock dividends

A deemed preferred stock dividend of $468,214 and $469,928 has been disclosed for the nine months ended September 30, 2017 and 2016. This amount represents the dividends that are due, but remain undeclared, to Series B and Series C preferred stock holders.

 

Net loss available to common stockholders

We incurred a net loss available to common stockholders of $931,400 and $3,100,819 for the nine months ended September 30, 2017 and 2016, respectively, a decrease of $2,169,419 or 70.0% which consists of the various items discussed above.

 

Liquidity and Capital Resources.

Although we have cash balances of $8,755,803 as of September 30, 2017, we have a history of annual losses from operations since inception and we have primarily funded our operations through sales of our unregistered equity securities. We have recently suspended our operations and reduced our operating expenses as the Board of Directors are considering various options as to the future direction of the Company, including a possible dissolution. Should the Board of Directors decide to dissolve our company, due to uncertainties about whether we are able to realize the full value of our assets, we cannot make any assurances regarding the amount available for distribution to our shareholders. We have made certain projections relating to the amount of cash we expect to have to distribute to our shareholders upon dissolution. These projections generally relate to the amount of liabilities which must be satisfied before our company is dissolved, the amount we expect preferred stockholders to receive for their equity interest. Each of the above projections is subject to multiple variables, including the timing of a dissolution affecting the amount of dividends payable and the amount of liabilities owed at the time of dissolution. Based upon current estimates, if we were to dissolve this quarter, no assurance can be given that common shareholders or subordinate preferred shareholders will receive any such distribution.

 

To date, our primary sources of cash have been funds raised from the sale of our securities and the issuance of convertible and non-convertible debt. No additional funds were raised during the current financial period.

 

We have incurred an accumulated deficit of $18,975,627 through September 30, 2017 and incurred negative cash flow from continuing operations of $413,953 for the nine months ended September 30, 2017.

 

Our primary commitments include the minimum commitments under the license agreements. Based upon our current plans, we believe that our cash will be sufficient to enable us to meet our anticipated operating needs for at least the next twelve months, subject to any business strategy decisions taken by the Board of Directors.

 

 7 

 

 

Our minimum commitments under the License Agreement for the next five years (assuming the License Agreement remains in effect and the $500,000 annual royalty payment with respect to the United States territory is not required to be paid), is summarized as follows:

 

   Amount 
     
2017  $500,000 
2018   500,000 
2019   500,000 
2020   500,000 
2021   500,000 
   $2,500,000 

 

Off Balance Sheet Arrangements

 

There are no off balance sheet arrangements.

 

Item 3. Quantitative and Qualitative Disclosures About Market Risks

 

None.

 

Item 4. Controls and Procedures

 

(a)Evaluation of disclosure controls and procedures

Pursuant to Rule 13a-15(b) under the Securities Exchange Act of 1934 (“Exchange Act”), the Company carried out an evaluation, with the participation of the Company’s management, including the Company’s Chief Executive Officer (“CEO”), who also serves as our principal financial and accounting officer, of the effectiveness of the Company’s disclosure controls and procedures (as defined under Rule 13a-15(e) under the Exchange Act) as of the end of the period covered by this report. Based upon that evaluation, the Company’s CEO who also serves as our principal financial and accounting officer concluded that due to a lack of segregation of duties and insufficient controls over review and accounting for certain complex transactions, that the Company’s disclosure controls and procedures as of September 30, 2017 were not effective to ensure that information required to be disclosed by the Company in the reports that the Company files or submits under the Exchange Act, was recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the Company’s management, including the Company’s CEO, as appropriate, to allow timely decisions regarding required disclosure. If the Company continues its operations it intends to retain additional individuals to remedy the ineffective controls. However, we cannot assure you that our internal control over financial reporting, as modified, will enable us to identify or avoid material weaknesses in the future.

 

(b)Changes in Internal Control over Financial Reporting

There has been no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) that occurred during our fiscal quarter ended September 30, 2017 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

 8 

 

 

Part II. OTHER INFORMATION

 

Item 1. Legal Proceedings

 

None.

 

Item 1A. Risk Factors

 

The following information updates, and should be read in conjunction with, the information disclosed in Part1, Item 1A, “Risk Factors” contained in our Annual Report on Form 10-K filed with the SEC on August 7, 2017. Except as disclosed below, there have been no material changes to the risk factors in our Annual Report on Form 10-K filed with the SEC on August 7, 2017.

 

We may not be profitable.

 

We expect to incur operating losses for the foreseeable future. For the nine months ended September 30, 2017 we have net revenues of $25,000 and for the year ended December 31, 2016 and 2015, we had net revenues of $0 and $91,000 from our plasma pulse oil recovery business. For the nine months ended September 30, 2017 and the year ended December 31, 2016 we have sustained a net loss of $463,186 and $4,118,967, respectively. To date, we have not acquired any oil wells, we have not generated significant revenue from the Licensed Plasma Pulse Technology and we have generated insufficient revenue from our operations in Mexico. Our ability to become profitable depends on our ability to find acquisition candidates or assets that generate revenue, to have successful operations and generate and sustain sales, while maintaining reasonable expense levels, all of which are uncertain in light of our limited operating history in our current line of business and our recent changes in business strategy.

 

Our consolidated financial statements have been prepared assuming that we will continue as a going concern.

 

We have incurred recurring operating losses and had a net loss for the nine months ended September 30, 2017 and the year ended December 31, 2016. We have also suspended our business operations. These conditions raise substantial doubt about our ability to continue as a going concern. The consolidated financial statements for the nine months ended September 30, 2017 do not include any adjustments that might result from the outcome of this uncertainty.

 

We had intended to become an exploitation and production stage company but to date have not found any suitable oil wells to acquire, therefore we are reevaluating our business plan and strategy, making it difficult to evaluate our company.

 

We intended to use the proceeds from the sale of our Series C Preferred Stock to acquire oil fields and intend to become an exploitation and production stage company; however, to date we have not found an oil field meeting the criteria acceptable to the Board (which criteria include among other things, low general and administrative costs, ability to generate cash flow and ability to fully utilize the PPT). Our Board is reevaluating its business plan and strategy and has suspended operations and reduced operating expenses, including staffing, in order to preserve capital, while the Board evaluates its options including the possible sale of our technology and PPT assets, forming a special committee to investigate a possible share buyback of the majority shareholder, Ervington Investments, and/or a possible dissolution of the Company. Until such time as the Board determines its strategy, it will be difficult for an investor to evaluate our business.  If the special committee determines to proceed with the sale of the Company’s technology and PPT assets, it may consider acquiring other assets and entering into new businesses for which there can be no assurance of successful operation.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds for the nine months ended September 30, 2017

 

None.

 

Item 3. Defaults upon senior Securities

 

None.

 

Item 4. Mine Safety Disclosures

 

None.

 

Item 5. Other Information

 

None.

 

 9 

 

 

Item 6. Exhibits

 

Regulation
Number
  Exhibit
10.1   Asset Purchase Agreement between the Company and Norma Investments Limited dated as of February 12, 2018
10.2   Share Repurchase Agreement between the Company and Ervington Investments Ltd dated as of February 12, 2018
31.1   Certification of the Chief Executive Officer, Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2   Certification of the Chief Financial Officer, Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1   Certification of the Chief Executive Officer  Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act
32.2   Certification of the Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act
101.INS   XBRL Instance Document
101.SCH   XBRL Taxonomy Extension Schema Document
101.CAL   XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF   XBRL Taxonomy Extension Definition Linkbase Document
101.LAB   XBRL Taxonomy Extension Label Linkbase Document
101.PRE   XBRL Taxonomy Extension Presentation Linkbase Document

  

SIGNATURES

 

Pursuant to the requirements 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.

 

DATE: February 12, 2018 PLEDGE PETROLEUM CORP.
  (Registrant)
     
  By:  /s/ Ivan Persiyanov
    Ivan Persiyanov, President and Chief Executive Officer
    (Principal Executive Officer and Principal Financial Officer)

 

 10 

EX-10.1 2 tv482307_ex10-1.htm EXHIBIT 10.1

Exhibit 10.1

 

EXECUTION COPY

 

ASSET PURCHASE AGREEMENT

 

ASSET PURCHASE AGREEMENT (the “Agreement”) made as of February12, 2018, by and between and Pledge Petroleum Corp., a Delaware corporation (the “Seller”) and Norma Investments Limited, an entity organized under the laws of the British Virgin Islands (the “Buyer”).

 

WITNESSETH:

 

WHEREAS, Seller is engaged in the business of applying plasma pulse technology to enhance the recovery of oil from wells (the “Business”), and the Buyer desires to purchase from the Seller, and Seller desires to sell to the Buyer, all of the Seller’s business, assets and properties used, or held or developed for use, in the Business, upon the terms and conditions hereinafter set forth herein.

 

NOW, THEREFORE, in consideration of the mutual covenants and promises herein contained and upon the terms and conditions hereinafter set forth, the parties hereto, intending to be legally bound, agree as follows:

 

1.      PURCHASE AND SALE OF THE ASSETS. Upon the terms and conditions herein contained, at the Closing (as hereinafter defined), the Seller hereby sells, transfers, assigns, conveys and delivers to the Buyer and the Buyer hereby purchases from the Seller, all rights, title and interest of the Seller in and to all of the Seller’s assets and properties used, or held or developed for use, in the Business (the “Purchased Assets”), including, without limitation, the assets set forth on Schedule A hereto (the assets on Schedule A, the “Assets”), free and clear of all liens, claims, pledges, mortgages, restrictions, obligations, security interests and encumbrances of any kind, nature and description (“Liens”). The Buyer is not assuming any liabilities in connection with the purchase of the Purchased Assets and the Seller shall timely discharge and satisfy all such liabilities when due.

 

2.CONSIDERATION. The purchase price to be paid by the Buyer to the Seller in connection with the purchase and sale of the Purchased Assets (the “Purchase Price”) shall be Six Hundred Fifty Thousand Dollars ($650,000), which amount the Seller hereby instructs the Buyer to pay to Ervington Investments Limited, an entity organized under the laws of the Republic of Cyprus (“Ervington”) as part of the consideration payable by the Seller to Ervington pursuant that certain Share Repurchase Agreement between Ervington and the Seller dated as of the date hereof (the “Share Repurchase Agreement”). The Seller hereby agrees that the Buyer shall not make any payment to the Seller in connection with the Closing, but shall be deemed to have paid the Purchase Price at the Closing by operation of the payment instruction in the previous sentence regardless of whether such payment is actually made by the Buyer to Ervington pursuant to such instruction and neither the Buyer nor any of its affiliates (including Ervington) shall have any liability to make any payment to the Seller in connection with the purchase and sale of the Purchase Assets at the Closing or otherwise

 

 1 

 

 

3.CLOSING. This closing of the transactions contemplated by this Agreement (the “Closing”) shall be consummated without further action of the Parties hereto at 10:00 a.m. New York City time on the day following the date of the Special Meeting of Stockholders of the Seller (the “Company Stockholder Meeting”) or any adjournment thereof at which the holders of a majority of the outstanding voting securities of the Seller other than those securities held by Ervington approve the sale of the Purchased Assets to the Buyer pursuant to the terms hereof (the “Majority of the Minority Vote”). Contemporaneously with the execution and delivery hereof, the parties hereto and Ervington have placed the following in escrow with Delaware Trust Company, as escrow agent (the “Escrow Agent”) pursuant to an escrow agreement among the Escrow Agent, the Seller and Ervington (the “Escrow Agreement”): (i) the share certificates evidencing the 3,137,500 shares of Series A-1 convertible preferred stock, the 4,500,000 shares of Series C preferred stock and the 64,302,467 shares of common stock of the Seller owned by Ervington (collectively, the “Shares”) together with stock powers executed by Ervington transferring ownership of such certificates to the Seller; (ii) a Bill of Sale transferring the Purchased Assets to Buyer, (iii) an assignment of patents agreement transferring to the Buyer all of Seller’s interest in patent number 2017-04545; (iv) the written resignation of Ivan Persiyanov as a director of the Seller and all of its subsidiaries and as an officer of the Seller and its subsidiaries, effective by its terms as of the Closing; and (v) $7,850,000 in immediately available funds from Seller (representing the purchase price due to Ervington under the Share Repurchase Agreement less the Purchase Price due hereunder for the Purchased Assets). Following receipt of the Majority of the Minority Vote, the Buyer shall cause Ervington, and the Seller shall, promptly provide a Joint Written Instruction (as defined in the Escrow Agreement) instructing the Escrow Agent to release the Escrow Fund and the Escrow Documents (each as defined in the Escrow Agreement) pursuant to Section 4(b)(ii) of the Escrow Agreement and, upon receipt of such written evidence and pursuant to the terms of the Escrow Agreement, the Escrow Agent shall deliver the above referenced items as follows: (a) the items referenced in clauses (i) and (iv) of this Section 3 shall be released from escrow and delivered to the Seller and (b) the items referenced in clauses (ii), (iii) and (v) of this Section 3 shall be released from escrow and delivered to Ervington. This Agreement shall automatically terminate and be of no further force and effect without any action on the part of the parties hereto if the Majority of the Minority Vote is not obtained by May 13, 2018; provided, that such date shall automatically be extended to June 27, 2018 without any action on the part of either party hereto if the SEC (as defined below) notifies the Seller that it will be reviewing and/or providing comments on the Company Proxy Statement (as defined below) and the parties hereto shall promptly notify the Escrow Agent in writing of such automatic extension; provided, further, that Article 8 shall survive any such termination and that no such termination shall relieve any party from any liability or damages arising out of such party’s fraud or willful or material breach prior to such termination, in which case the non-breaching party shall be entitled to all rights and remedies available at law or in equity. Upon the termination of this Agreement for any reason, including pursuant to the previous sentence, pursuant to the terms of the Escrow Agreement, the items referenced in clauses (ii), (iii) and (v) of this Section 3 shall be returned to the Seller and the items referenced in clauses (i) and (iv) shall be returned to Ervington.

 

4.     SELLER REPRESENTATIONS AND WARRANTIES. Seller hereby represents and warrants to, and agrees with, Buyer as follows:

 

4.1       Organization and Good Standing. The Seller is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware.

 

4.2       No Conflict. The execution and delivery of this Agreement, and the consummation of the transactions contemplated hereby, will not result in a breach, violation or default or give rise to an event which with the giving of notice or after the passage of time, or both, would result in a breach, violation or default of any of the terms or provisions of the Seller's Certificate of Incorporation, By-Laws or of any statute, indenture, mortgage, deed of trust, loan agreement or other material agreement, instrument or restriction to which the Seller is a party or by which the Seller or its assets may be bound or affected, or any order, rule or regulation of any court or governmental agency or body having jurisdiction over the Seller.

 

 2 

 

 

4.3       Agreements. The Buyer has been provided a true and complete list of all contracts, instruments, commitments and agreements, whether oral or written, which it believes are presently in effect to which the Seller is a party or to which Seller is subject and which relate to the Assets. The Seller’s disclosure in its filings with the Securities and Exchange Commission note that on July 19, 2016, Novas Energy Group Limited provided a notice to the Seller terminating its license with the Seller. Each such agreement is a valid and subsisting agreement and in full force and effect, all payments due from the Seller thereunder have been made, there are no disputes or suits or actions at law or otherwise pending or threatened thereunder, except as specifically described on Schedule 4.3, and such agreements are all of the contracts or agreements constituting part of the Purchased Assets.

 

4.4       Authority. The Seller has full authority or capacity to execute and to perform this Agreement in accordance with its terms; the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized by all necessary action on the part of Seller and does not and will not result in a breach, violation or default or give rise to an event which, with the giving of notice or after the passage of time, or both, would result in a breach, violation or default of any of the terms or provisions or of the Certificate of Incorporation, bylaws, any statute, indenture, mortgage, deed of trust, loan agreement or other material agreement, instrument or restriction to which the Seller is a party or by which the Seller or its assets may be materially bound or affected, or any order, rule or regulation of any court or governmental agency or body having jurisdiction over the Seller; and no further authorization or approval, whether of governmental bodies or otherwise, is necessary in order to enable the Seller to enter into and perform the same; and this Agreement constitutes a valid and binding obligation enforceable against the Seller in accordance with its terms.

 

4.5       Compliance with Law. The Seller is not in violation in any material respect of any laws, governmental orders, rules or regulations, whether federal, state or local, to which it or any of its properties are subject.

 

4.6       Litigation. To the knowledge of the Company, there are no actions, suits, proceedings or investigations pending or, to the best of Seller's knowledge, threatened against or affecting the Assets, business or properties of the Seller whether at law or in equity or admiralty or before or by any federal, state, municipal or other governmental department, commission, board, agency, court or instrumentality, domestic or foreign; nor is the Seller operating under, subject to, in violation of or in default with respect to, any judgment, order, writ, injunction or degree of any court or federal, state, municipal or other governmental department, commission, board, agency or instrumentality domestic or foreign. To the knowledge of the Company, no inquiries have been made by any governmental agency relating to the Seller which might form the basis of any such action, suit, proceeding or investigation, or which might require the Seller to undertake a course of action which would involve any expense.

 

4.7       Taxes. The Seller has filed, or caused to be filed, with all appropriate governmental agencies all required tax and information returns and have paid, caused to be paid or accrued all taxes (including, without limitation, all income, franchise, sales, excise and use taxes), assessments, charges, penalties and interest shown to be due and payable. The Seller has no liability, contingent or otherwise, for any taxes, assessments, charges, penalties or interest, other than amounts adequately reserved for. The Seller has not received directly or indirectly notice of, nor is it otherwise aware of an audit or examination; the Seller is not a party directly or indirectly to any action or proceeding by any governmental authority for assessment or collection of taxes, charges, penalties or interest; nor has any claim for assessment and collection been asserted against the Seller directly or indirectly; nor has the Seller executed a waiver of any statute of limitations with respect thereto. The Seller has paid, or caused to be paid, or adequately reserved for, all applicable corporate franchise taxes, unemployment taxes, payroll taxes, social security taxes, occupation taxes, ad valorem taxes, property taxes, excise taxes and imposts, sales and use taxes, and all other taxes of every kind, character or description required to be paid to the date hereof, and have received no notices and are not otherwise aware, of any deficiencies, adjustments or changes in assessments with respect to any such taxes. The Seller has duly filed, or caused to be filed, all reports or returns relating to or covering any such taxes or other charges which are due or required to be filed at the date hereof and no extensions of time are in effect for the assessment of deficiencies for such taxes in respect of any fiscal period.

 

 3 

 

 

4.8       Title to Assets. The Seller has good and marketable title to the Purchased Assets, free and clear of all Liens. Except for cash, cash equivalents and marketable securities, (i) to the knowledge of the Company, the Assets comprise all the assets, properties, business, goodwill and rights of every kind and description used, held or developed for use in, or useful or necessary to, the conduct of the Business, and (ii) there are no assets, properties, business, goodwill, rights or services used in the conduct of the Business that are owned by any person or entity other than the Seller. The Seller has full right to transfer the Purchased Assets. The Purchased Assets are being sold as is and the Seller makes no express or implied warranties of merchantability or fitness for a particular purpose.

 

4.9       Proxy Statement. None of the information included or incorporated by reference in the Company Proxy Statement (as defined below) will, at the date it is first mailed to the Seller’s stockholders or at the time of the Company Stockholders Meeting or at the time of any amendment or supplement thereof, contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading.

 

4.10      Brokers or Finders. No broker, finder or investment banker is entitled to any brokerage, finder’s or other fee or commission in connection with the sale of the Purchased Assets to Buyer based upon arrangements made by or on behalf of Seller.

 

5.     BUYER REPRESENTATIONS AND WARRANTIES. Buyer hereby represents and warrants to, and agrees with, Seller as follows:

 

5.1       Acknowledgement. The Seller has made no representations or warranties as to the Assets of the Seller, except as specifically set forth in this Agreement.

 

5.2       Authority. The Buyer has full authority or capacity to execute and to perform this Agreement in accordance with its terms; the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby does not and will not result in a breach, violation or default or give rise to an event which, with the giving of notice or after the passage of time, or both, would result in a breach, violation or default of any of the terms or provisions or of the Articles of Organization, Operating Agreement, any statute, indenture, mortgage, deed of trust, loan agreement or other material agreement, instrument or restriction to which the Buyer is a party or by which the Buyer or its assets may be materially bound or affected, or any order, rule or regulation of any court or governmental agency or body having jurisdiction over the Buyer; and no further authorization or approval, whether of governmental bodies or otherwise, is necessary in order to enable the Buyer to enter into and perform the same; and this Agreement constitutes a valid and binding obligation enforceable against the Buyer in accordance with its terms.

 

5.3       Access To Data. The Buyer has had full access to all pertinent data and information regarding the Seller’s plasma pulse technology business operations and, as such, has received all the information it considers necessary or appropriate for deciding whether to purchase the Purchased Assets.

 

 4 

 

 

5.4       Brokers or Finders. No broker, finder or investment banker is entitled to any brokerage, finder’s or other fee or commission in connection with the sale of the Purchased Assets to Buyer based upon arrangements made by or on behalf of Buyer.

 

5.5.      Notice of Termination. The Buyer acknowledges that Novas Energy Group Limited has sent a notice of termination to the Seller with respect to its license agreement with the Seller and that the Seller may not have any rights to transfer under such license.

 

6.      INDEMNIFICATION. Seller shall indemnify and hold harmless Buyer, Ervington and their respective officers, directors and stockholders (each an “Indemnified Party”), from and against any and all demands, claims, actions or causes of action, judgments, assessments, losses, liabilities, damages or penalties and reasonable attorneys' fees and related disbursements from creditors or shareholders of the Seller suffered by such Indemnified Party incident to, resulting from or arising out of the preparation or performance under this Agreement or incident to any claims, actions or liabilities arising as a result of the conduct of the Business by the Seller.

 

7.      COVENANTS.

 

7.1      Restrictive Covenants.

 

(a)Confidentiality. From and after the date hereof, the Seller will, and will cause its affiliates to, refrain from using or disclosing, and will take all commercially reasonable steps to prevent unauthorized use or disclosure of, any Confidential Information. In the event that a Seller reasonably believes after consultation with counsel that such Seller or affiliate is required by applicable law to disclose any Confidential Information, such Seller or affiliate may disclose only such Confidential Information as may be legally required, provided that it (i) provides the Buyer with prompt notice before such disclosure so that the Buyer may attempt to obtain a protective order or other assurance that confidential treatment will be accorded to such Confidential Information and (ii) cooperates with the Buyer in attempting to obtain such order or assurance. “Confidential Information” means all information of a confidential or proprietary nature (whether or not specifically labeled or identified as “confidential”), in any form or medium, of the Company related to the Business or its customers, suppliers, distributors or other business relations, including all information concerning finances, customer information, supplier information, products, services, prices, organizational structure and internal practices, forecasts, sales and other financial results, records and budgets, and business, marketing, development, sales and other commercial strategies, unpatented inventions, ideas, methods and discoveries, trade secrets, know-how, unpublished patent applications and other confidential intellectual property, designs, specifications, documentation, components, source code, object code, schematics, drawings, protocols and processes.

 

(b)Non-Competition. The Seller covenants and agrees that during the period beginning on the date hereof and ending upon the fifth (5th) anniversary of such date (the “Term”) the Seller and its affiliates will not, directly or indirectly, engage or participate in any manner (as an owner, equity holder, financing source, director, manager, officer, employee, agent, representative, consultant, service provider or otherwise) in any business that is or may reasonably be considered to be competitive with the Business or any presently contemplated expansions or extensions thereof, anywhere in the world.

 

 5 

 

 

(c)Non-Disparagement. Each party hereby covenants and agrees that during the Term neither it nor its affiliates will, directly or indirectly, make any derogatory or disparaging statement or communication regarding the other party or any of the other party’s affiliates or the Business or any of their respective employees.

 

(d)Blue-Pencil. If any court of competent jurisdiction shall at any time deem the term of any particular restrictive covenant contained in this Section 7.1 too lengthy, the geographic area covered too extensive or the scope too broad, the other provisions of this Section 7.1 shall nevertheless stand, the term shall be deemed to be the longest period permissible by law under the circumstances, the geographic area covered shall be deemed to comprise the largest territory permissible by law under the circumstances and the scope shall be as broad as permissible by law under the circumstances. The court in each case shall reduce the term, geographic area and or scope covered to permissible duration, size or breadth.

 

(e)Acknowledgements; Remedies. The Seller acknowledges and agrees that (i) the covenants and agreements set forth in this Section 7.1 were a material inducement to the Buyer to enter into this Agreement and to perform its obligations hereunder, (ii) the Buyer and its stakeholders would not obtain the benefit of the bargain set forth in this Agreement as specifically negotiated by the parties hereto if the Seller or any of their respective affiliates breached the provisions of this Section 7.1, (iii) any breach of the provisions of this Section 7.1 by the Seller or any of its respective affiliates would result in a significant loss of goodwill by the Buyer, (iv) the consideration paid by the Buyer to the Seller hereunder is sufficient consideration to make the covenants and agreements set forth herein enforceable, (v) the length of time, scope and geographic coverage of the covenants set forth in this Section 7.1 is reasonable given the benefits the Seller will directly or indirectly receive hereunder, (vi) the Seller is familiar with all the restrictive covenants contained in this Section 7.1 and is fully aware of its obligations hereunder, and (vii) the Seller will not challenge the reasonableness of the time, scope, geographic coverage or other provisions of this Section 7.1 in any proceeding, regardless of who initiates such proceeding. The Seller further acknowledges and agrees that irreparable injury will result to the Buyer if the Seller or any of its affiliates breaches any of the terms of this Section 7.1, and that in the event of an actual or threatened breach by the Seller or any of its affiliates of any of the provisions contained in this Section 7.1, the Buyer will have no adequate remedy at law. The Seller accordingly agrees that in the event of any actual or threatened breach by the Seller or any of its affiliates of any of the provisions contained in this Section 7.1, the Buyer shall be entitled to injunctive and other equitable relief without (i) the posting of any bond or other security, (ii) the necessity of showing actual damages and (iii) the necessity of showing that monetary damages are an inadequate remedy. Nothing contained herein shall be construed as prohibiting the Buyer from pursuing any other remedies available to it for such breach or threatened breach, including the recovery of any damages that it is able to prove. The Seller shall cause its affiliates to comply with this Section 7.1, and shall be liable for any breach by any of its affiliates of this Section 7.1. In the event of a breach or violation by the Seller or any of its affiliates of this Section 7.1, the Term shall be extended by a period of time equal to the period of time during which such person or entity violates the terms of this Section 7.1.

 

 6 

 

 

7.2       Transfer Taxes. All transfer, documentary, sales, use, registration, stamp and other taxes and fees (including any penalties and interest thereon) incurred in connection with the transactions contemplated by this Agreement (together, “Transfer Taxes”) shall be paid by the Seller when due, and the Seller shall, at its expense, file all necessary tax returns and other documentation with respect to all such Transfer Taxes.

 

7.3       Publicity. None of the Seller, the Buyer or any of their respective affiliates shall issue any press release or make any public announcement or filing (including any filing with the U.S. Securities and Exchange Commission (the “SEC”)) concerning this Agreement or the transactions contemplated herein without obtaining the prior written approval of the other parties hereto, which approval will not be unreasonably withheld or delayed, unless the content of such press release, public announcement or filing is substantially consistent in form and substance with the disclosures set forth in the preliminary Company Proxy Statement (as defined below) as initially filed with the SEC or as subsequently approved by the Buyer; provided that the party intending to make such release shall use its commercially reasonable efforts to consult with the other party with respect to the timing and content thereof.

 

7.4      Proxy Statement; Company Stockholders Meeting.

 

(a)On the date hereof, the Seller filed the preliminary proxy statement in connection with the transactions contemplated hereby (the “Company Proxy Statement”) with the SEC. The Seller shall not file any amendment or supplement to the Company Proxy Statement without providing the Buyer a reasonable opportunity to review and comment thereon (which comments shall be reasonably considered by the Seller). Each of the Seller and the Buyer shall use its reasonable best efforts to resolve, and each party agrees to consult and cooperate with the other parties in resolving, all SEC comments with respect to the Company Proxy Statement as promptly as practicable after receipt thereof and to cause the Company Proxy Statement in definitive form to be cleared by the SEC and mailed or made available to the Seller’s shareholders as promptly as reasonably practicable following filing with the SEC. The Seller agrees to consult with the Buyer (and reasonably consider any comments provided by the Buyer) prior to responding to SEC comments with respect to the Company Proxy Statement and, to the extent reasonably practicable, permit the Buyer and its outside counsel to participate in all meetings, telephone conferences and other substantive communications with the SEC relating to the Company Proxy Statement. Each of the Seller and the Buyer agrees to correct any information provided by it for use in the Company Proxy Statement which shall have become false or misleading and the Seller shall promptly, to the extent required by applicable law, prepare and mail or make available to its stockholders an amendment or supplement setting forth such correction. The Seller shall as soon as reasonably practicable (i) notify the Buyer of the receipt of any comments from the SEC with respect to the Company Proxy Statement and any request by the SEC for any amendment to the Company Proxy Statement or for additional information and (ii) provide the Buyer with copies of all written correspondence between the Seller and its representatives, on the one hand, and the SEC, on the other hand, with respect to the Company Proxy Statement or the transactions contemplated hereby.

 

 7 

 

 

(b)The Seller shall, as soon as practicable following the date on which the Seller is informed that the SEC has no further comments on the preliminary Company Proxy Statement, duly set a record date for, call, give notice of, convene and hold the Company Stockholders Meeting. The Company shall not make any change to the recommendation by the Special Committee of the Company’s Board of Directors of the transactions contemplated hereby and use its reasonable best efforts to (i) solicit from its stockholders proxies in favor of the adoption of this Agreement and the transactions contemplated by this Agreement, and (ii) take all other action necessary or advisable to secure the Majority of the Minority Vote. Promptly following the filing of the Company Proxy Statement in definitive form, the Buyer shall deliver to the Company the executed proxy of Ervington voting all of the Shares at the Company Stockholders Meeting in favor of the transactions contemplated by this Agreement in the same form as is contained in the Company Proxy Statement, which proxy shall be deemed irrevocable and coupled with an interest until the earlier of the Closing and the termination of this Agreement pursuant to its terms. Furthermore, the Buyer shall not take any action with the purpose of adversely affecting the Company’s solicitation of stockholders proxies in favor of the adoption of this Agreement and the transactions contemplated by this Agreement or securing the Majority of the Minority Vote. If, at any time following the dissemination of the Company Proxy Statement, either the Seller or the Buyer reasonably determines in good faith (after consulting with the other) that a quorum or the Majority of the Minority Vote is unlikely to be obtained at the Company Stockholders Meeting, then the Seller shall have the right to adjourn or postpone the Company Stockholders Meeting from time to time; provided that no such adjournment or postponement shall delay the Company Stockholders Meeting by more than thirty (30) days from the currently scheduled date. During any such period of adjournment or postponement, the Seller shall continue in all respects to comply with its obligations under this ‎Section 7.4.

 

7.5      Releases.

 

(a)The Seller, on the Seller’s own behalf and on behalf of its heirs, successors, trustees, executors, administrators, assigns and any other person or entity that may claim by, through or under the Seller (collectively, the “Seller Releasing Parties”), hereby (i) irrevocably waives, releases and discharges the Buyer and its affiliates (including Ervington) and each of their respective present and former managers, directors, officers, employees, agents and representatives (collectively, the “Buyer Released Parties”) from any and all liabilities of any kind or nature whatsoever in respect of any cause, matter or thing relating to any of the Buyer Released Parties occurring or arising on or prior to the date of this Agreement, except for any rights or obligations under this Agreement or the Stock Purchase Agreement, and (ii) agrees that no Seller Releasing Party will bring or voluntarily participate in or assist any legal proceeding that relates to any matter released pursuant to clause (i) of this Section 7.4(a).

 

 8 

 

 

(b)The Buyer, on the Buyer’s own behalf and on behalf of its heirs, successors, trustees, executors, administrators, assigns and any other person or entity that may claim by, through or under the Buyer (collectively, the “Buyer Releasing Parties”), hereby (i) irrevocably waives, releases and discharges the Seller and its affiliates and each of their respective present and former managers, directors, officers, employees, agents and representatives (collectively, the “Seller Released Parties”) from any and all liabilities of any kind or nature whatsoever in respect of any cause, matter or thing relating to any of the Seller Released Parties occurring or arising on or prior to the date of this Agreement, except for any rights or obligations under this Agreement or the Stock Purchase Agreement, and (ii) agrees that no Buyer Releasing Party will bring or voluntarily participate in or assist any legal proceeding that relates to any matter released pursuant to clause (i) of this Section 7.4(b).

 

8.      MISCELLANEOUS.

 

8.1       Binding Effect. This Agreement shall insure to the benefit of, and shall be binding upon, the parties hereto and their respective successors and permitted assigns. Except as otherwise set forth herein, this Agreement may not be assigned by any party hereto without the prior written consent of the parties hereto. Except as otherwise set forth herein, nothing in this Agreement, expressed or implied, is intended to confer on any person other than the parties hereto or their respective successors and permitted assigns any rights, remedies, obligations or liabilities under or by reason of this Agreement.

 

8.2       Notices. All notices, requests, demands and other communications which are required to be or may be given under this Agreement shall be in writing and shall be deemed to have been duly given when delivered in person, or transmitted by telecopy or telex, or upon receipt after dispatch by certified or registered first class mail, postage prepaid, return receipt requested, to the party to whom the same is so given or made, at the following addresses (or such others as shall be provided in writing hereinafter):

 

(a)If to the Seller, to:

 

Pledge Petroleum Corp.

1811 North Freeway, Suite 513

Houston, Texas 77060

Attention: John Zotos

Email: zotozulu@mac.com

 

 

 

With a copy to:

   
  Leslie Marlow
  Gracin & Marlow, LLP
  405 Lexington Avenue, 26th Floor
  New York, New York 10174
  Facsimile: (212) 208-4657
  Email: lmarlow@gracinmarlow.com

        

 

 9 

 

 

(b)If to the Buyer, to:

 

Norma Investments Limited

Coastal Building

Wickhams Cay II, Road Town, 2221

Tortola, British Virgin Islands

 

8.3       Entire Agreement. This Agreement constitutes the entire agreement and supersedes all prior agreements and understandings, oral and written, between the parties hereto with respect to the subject matter hereof.

 

8.4       Further Assurances. After the Closing, at the request of either party, the other party shall execute, acknowledge and deliver, without further consideration, all such further assignments, conveyances, endorsements, deeds, powers of attorney, consents and other documents and take such other action as may be reasonably requested to consummate the transactions contemplated by the Agreement. The Seller shall reasonably cooperate with the Buyer, at the Buyer’s request and at the Buyer’s expense, in connection with the delivery of any of the Purchased Assets.

 

8.5       Headings. The section and other headings contained in this Agreement are for reference purposes only and shall not be deemed to be a part of this Agreement or to affect the meaning or interpretation of this Agreement.

 

8.6       Counterparts. This Agreement may be executed in any number of counterparts, each of which, when executed, shall be deemed to be an original and all of which together shall be deemed to be one and the same instrument.

 

8.7       Governing Law; Jurisdiction. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD TO ITS RULES OF CONFLICT OF LAWS. Each of the parties hereto (i) consents to submit itself to the personal jurisdiction of the Delaware Court of Chancery or, if such court does not have jurisdiction over a particular matter, any court of the United States located in the State of Delaware or of any Delaware state court in the event any dispute arises out of this Agreement or the Transactions, (ii) agrees that it will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such court, (c) agrees that it will not bring any action relating to this Agreement or the Transactions in any court other than a court of the United States located in the State of Delaware or a Delaware state court and (d) consents to service of process in the manner provided for in Section 8.2. EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (I) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (II) EACH SUCH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (III) EACH SUCH PARTY MAKES THIS WAIVER VOLUNTARILY, AND (IV) EACH SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

 

 10 

 

 

8.8       Severability. If any term or provision of this Agreement shall to any extent be invalid or unenforceable, the remainder of this Agreement shall not be affected thereby, and each term and provision of this Agreement shall be valid and enforced to the fullest extent permitted by law.

 

8.9       Amendments. This Agreement may not be modified or changed except by an instrument or instruments in writing executed by the parties hereto.

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written.

 

  SELLER:
   
  PLEDGE PETROLEUM CORP.
 

 

 

  By:  /s/ John Zotos  
    Name: John Zotos  
    Title: Corporate Secretary  
     
  BUYER:  
     
 

NORMA INVESTMENTS LIMITED

 

 
     
  By: /s/ Thackeray Investments Limited  
    Name: Thackeray Investments Limited
    Title: Director  

 

  

 

 

 

 

 

 

Signature page to Asset Purchase Agreement

 

 11 

 

 

Schedule A

 

 

 

Intellectual Property:

 

1.Patent application - PCT/US2017/04545

 

Production Tools:

 

7 oil field drilling tools

 

1.SH 104

2.SH 101

3.SH 102

4.SH 103

5.SH 106

6.SH 104

7.SH 107

 

2 Empty wood boxes

5 New wood boxes

 

Tool Boxes:

 

2. Stanley Tool Boxes

 

First Stanley Tool Box

 

2. Work Smart Mini-Boxes

 

1.Mini-Box
·Electoral Tape
·Ziploc bag with:
o7 Rings (big metallic)
o6 Rings (big rubber)
o3 Rings (medium rubber)
o4 Rings (small rubber)
o1 Spoke Key
·550 Lubricant (1/4 lb. or 113 G)
·Loctite LB. 8008TM C5-A Lubricant (8 oz./226 G)
·4 Screws to drill pilot holes
o1/16” 3/32” 7/64” 1/8”
·2 small black keys
·10 energizer battery
·Safety glasses
·One sand paper

 

 

·2 Ear Plugs
·One locked out warning sticker

 

 12 

 

 

·CHR Reamer 1/32”
·4 Locks with keys
·Scanner Wrench ¼
·15/16 Point Combination Wrench

 

2. Mini-Box

 

·Digital multi-meter cat no. 22-812
·Silver Conductive grease
·Terminal Kit (electrical connector kit)
·Vinyl electrical tape
·Color coding vinyl tape (TR005455455)
·Irwin tool (wire strippers)
·Hook-up and lead wire (RED) UL AWM 1213
·Tweezers
·TR-180B/DC/530 with rolls complaint
·USB to TTL5Y Header cable
·Amphenol 83-18p-1050 cable
·Connector
·Amphenol Head 74868 with 2 Panduits
·Amphenol cable with Pomona AL-B-12 Electoral
·Pomona 1166-36
·E2A/250 VP
·Small zip with 27 Panduits

 

 

·Acer Laptop V3-572PG-7673
·RU-6g Spark Gap
·Trash
·Ground Stick (serial 201-60516-3)
·2 Roller legs
·Power Butane gas 580oz./300ml. /mineral oil usp 320oz. 946mil. / Baby oil Mili 20 oz. 591ml.
·Tub
·2 rolls compliant cables 10A 125 V
·Electrical Box (plug-in)
·Blazer (multi-purpose tool kit)
·Tool box
·Monkey wrench
·Multi-plug
·2 capacitors
·Safety glasses
·5 pairs of gloves
·2 locks (1 key)

 

 13 

 

 

Second Stanley Tool Box

 

 

·2 locks (2 keys)
·Blazer multi-purpose tool kit
·Ground-stick 201-605-26-1
·Tub
·Power butane gas (58 oz./300 ml.)
·Multi-plug outlet

2 rolls complaint cables 10 A 125 V

USB to TTL5V header cable

Amphenol 83-18p-1050 cable (orange)

Laptop V3-57ZPG-767J

SN: NXMNKAA002441141473400

 

Mech Tool Box

·550 Lubricant
·LB 8008 lubricant
·Tape Mil Kapton
·Oil tolerant
·Ziploc bag with
oOne big ring (rubber)
o2 med rings
o4 small rings
o2 spoke key
o6
·2 Pilot drill
·15/16 Point combination wrench
·Spanner wrench ¼
·2 Husky folding hex key

 

Electoral Tool Box

 

·Amphenol Cable 74868 (Orange)
·Silver conductive grease
·Digital multi-meter (P37772)
·Vinyl electrical tape
·Digital multi-meter (XC6013L)
·Irwin tool (wire strippers)
·Electrical connector kit
·2 X E 2A/250 VP
·Tran
·2 roller legs
·Electrical box (plug-in)

 

 14 

 

 

·Tool box
·Monkey wrench
·3 Capacitors
·2 spare SG (SG 115 SG 114)

 

Capacitor (8 boxes x 6ps
5872 5871 5864
5863 M1634 M1637
586g 5856  

 

·5 pcs copper/stainless electrodes
·Chain hoist (new)
·Spare SG 105
·Electrical cord
·Trans
·3xWIHA tools (screwdriver with chrome finish)
·3 cutter wheel for ridge and reed
·Amphenol 83-18P-1050 cable (orange)
·USB to TTL5V header cable
·ROHS compliant 10A125V cable
·3 boxes with .
·RYOBI 18 Drill
·Beam clamp 3KR11G
·Husky 823-112 VISE GRIP (2pcs)
·Drill mounted on wood with wire rod
·Trash bags and disinfecting wipes
·3 pcs pure sine wave inverter (x000J0NR57)

 

The THIRD BOX

 

·Tran
·Coaxial cable (205-521 BK)
·Spinnerbait box
oUSB to TTL5V Header cable
oThermocouple fork
o3 connector cables
o2 connectors
oCable with lenid FGG OB connection
·Pulse generator Model 9612
·Generator cable
·Amphenol 83-18p-1050 Cable (Orange)
·Coaxial cable RG-58BNC mole to mole black 100ft.
o5 pcs x 100ft.
·Seismic receiver (not part of transaction)

 

 

 15 

EX-10.2 3 tv482307_ex10-2.htm EXHIBIT 10.2

Exhibit 10.2

 

EXECUTION COPY

 

SHARE REPURCHASE AGREEMENT

 

SHARE REPURCHASE AGREEMENT (the “Agreement”) made as of this 12th day of February, 2018, by and between Ervington Investments Ltd, a company organized under the laws of Cyprus (the “Seller”) and Pledge Petroleum Corp., a Delaware corporation (the “Company”).

 

WITNESSETH:

 

WHEREAS, the Seller owns (i) 64,302,467 shares of common stock of the Company; (ii) 4,500,000 shares of Series C Preferred Stock of the Company; and (iii) 3,137,500 shares of Series A-1 Preferred Stock of the Company (collectively, the “Shares”), and the Company desires to purchase from the Seller, and Seller desires to sell, the Shares upon the terms and conditions hereinafter set forth herein.

 

NOW, THEREFORE, in consideration of the mutual covenants and promises herein contained and upon the terms and conditions hereinafter set forth, the parties hereto, intending to be legally bound, agree as follows:

 

1.           PURCHASE AND SALE OF THE STOCK.

 

Upon the terms and conditions herein contained, at the Closing (as hereinafter defined), the Seller hereby sells, assigns and transfers to the Company and the Company hereby purchases from the Seller all rights of the Seller in and to the Shares, as of the date of the Closing, free and clear of all liens, claims, pledges, mortgages, restrictions, obligations, security interests and encumbrances of any kind, nature and description (collectively, “Liens”) other than any Liens (a) arising under federal or state securities laws or (b) any Liens created by or through the Company (“Permitted Liens”).

 

2.           CONSIDERATION.

 

The purchase price to be paid by the Company to the Seller in connection with the purchase and sale of the Shares (the “Purchase Price”) is Eight Million Five Hundred Thousand Dollars ($8,500,000.00).

 

3.           CLOSING.

 

The parties hereto have heretofore placed the Shares together with stock powers duly executed by the Seller and the Purchase Price in escrow pending the closing the transactions contemplated by this Agreement with Delaware Trust Company as escrow agent (the “Escrow Agent”) under a separate escrow agreement, dated as of the date hereof (the “Escrow Agreement”). The Seller has also delivered to the Company the written resignation of Ivan Persiyanov as a director of the Company and all of its subsidiaries and as an officer of the Company and its subsidiaries effective by its terms as of the Closing (as defined below) (the “Resignation Documents”). The closing of the transactions contemplated by this Agreement (the “Closing”) shall take place simultaneously with the consummation of the transactions contemplated by that certain Asset Purchase Agreement annexed hereto as Exhibit A (the “Asset Purchase Agreement” and such transactions, the “Asset Sale”). The concurrent consummation of the Asset Sale is a condition precedent to the Closing. At the Closing, pursuant to the terms of the Escrow Agreement (a) the Resignation Documents shall become effective in accordance with their terms and be released to the Company, (b) the Purchase Price shall be released to the Seller by wire transfer of immediately available funds (less the $650,000 due to the Company under the Asset Purchase Agreement in respect of the Asset Sale that the Company instructed be paid to the Seller pursuant to Section 2 of the Asset Purchase Agreement) and (c) the Shares together with the duly executed stock powers shall be released to the Company. The Seller acknowledges and agrees that (i) it shall have no rights to any distribution of Company assets upon the consummation of the Asset Sale and that all of its rights as a shareholder of the Company shall cease immediately upon the Closing and (ii) immediately upon the Closing, (A) all accrued dividends shall be forgiven and are no longer owed and (B) the Investor’s Rights Agreement and Stockholder’s Rights Agreement entered into on February 19, 2015 will terminate in their entirety. This Agreement shall automatically terminate and be of no further force and effect without any action on the part of the parties hereto concurrently with any termination of the Asset Purchase Agreement in accordance with its terms; provided that Article 6 shall survive any such termination and that no such termination shall relieve any party from any liability or damages arising out of such party’s fraud or willful or material breach prior to such termination, in which case the non-breaching party shall be entitled to all rights and remedies available at law or in equity. Upon the termination of this Agreement for any reason, including pursuant to the previous sentence, pursuant to the terms of the Escrow Agreement, the Purchase Price shall be returned to the Seller and the Resignation Documents and the Shares (and stock powers) shall be returned to the Buyer.

 

 1 

 

 

4.          SELLER REPRESENTATIONS AND WARRANTIES. Seller hereby represents and warrants to, and agrees with, Company as follows:

 

4.1        Organization and Good Standing. Seller is duly organized, validly existing and in good standing under the laws of Cyprus.

 

4.2        No Liens. Seller will transfer to the Company good title to the Shares, free and clear of any Liens other than Permitted Liens. The Seller has full right to transfer the Shares.

 

4.3        Authority. Seller has full authority or capacity to execute and to perform this Agreement in accordance with its terms; the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby does not and will not result in a breach, violation or default or give rise to an event which, with the giving of notice or after the passage of time, or both, would result in a breach, violation or default of any of the terms or provisions or of any indenture, agreement, judgment, decree or other instrument or restriction to which Seller is a party or by which Seller may be bound or affected; and no further authorization or approval, whether of governmental bodies or otherwise, is necessary in order to enable Seller to enter into and perform the same; and this Agreement constitutes a valid and binding obligation enforceable against Seller in accordance with its terms.

 

4.4        No Conflict. The execution and delivery of this Agreement, and the consummation of the transactions contemplated hereby, will not result in a breach, violation or default or give rise to an event which with the giving of notice or after the passage of time, or both, would result in a breach, violation or default of any of the terms or provisions of the Seller's Certificate of Incorporation, By-Laws or of any statute, indenture, mortgage, deed of trust, loan agreement or other material agreement, instrument or restriction to which the Seller is a party or by which the Seller or its assets may be materially bound or affected, or any order, rule or regulation of any court or governmental agency or body having jurisdiction over the Seller.

 

4.5       Litigation. There are no actions, suits, proceedings or investigations pending or, to the best of Seller's knowledge, threatened against or affecting the Shares, business or properties of the Seller whether at law or in equity or admiralty or before or by any federal, state, municipal or other governmental department, commission, board, agency, court or instrumentality, domestic or foreign that would reasonably be expected to prohibit or restrain the ability of Seller to enter into this Agreement or consummate the transactions hereby.

 

 2 

 

 

4.6        No Other Representations and Warranties. Except for the representations and warranties contained in this Article IV, the Seller has not made or makes any other express or implied representation or warranty, either written or oral, including any representation or warranty as to the accuracy or completeness of any information regarding the Shares furnished or made available to the Company, or any representation or warranty arising from statute or otherwise in law. Except for the representations and warranties contained in this Article IV, Seller hereby disclaims all liability and responsibility for any representation, warranty, projection, forecast, statement, omission, or information made, not made, communicated, or furnished (whether orally or in writing) to the Company or any of its affiliates or representatives.

 

5.          COMPANY REPRESENTATIONS AND WARRANTIES. The Company hereby represents and warrants to, and agrees with, Seller as follows:

 

5.1        Organization and Good Standing. The Company is duly organized, validly existing and in good standing under the laws of the State of Delaware.

 

5.2        Authority. The Company has full authority or capacity to execute and to perform this Agreement in accordance with its terms; the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby does not and will not result in a breach, violation or default or give rise to an event which, with the giving of notice or after the passage of time, or both, would result in a breach, violation or default of any of the terms or provisions or of any indenture, agreement, judgment, decree or other instrument or restriction to which the Company is a party or by which the Company may be bound or affected; and no further authorization or approval, whether of governmental bodies or otherwise, is necessary in order to enable the Company to enter into and perform the same; and this Agreement constitutes a valid and binding obligation enforceable against the Company in accordance with its terms.

 

5.3        No Conflict. The execution and delivery of this Agreement, and the consummation of the transactions contemplated hereby, will not result in a breach, violation or default or give rise to an event which with the giving of notice or after the passage of time, or both, would result in a breach, violation or default of any of the terms or provisions of the Buyer’s Certificate of Incorporation, By-Laws or of any statute, indenture, mortgage, deed of trust, loan agreement or other material agreement, instrument or restriction to which the Buyer is a party or by which the Buyer or its assets may be materially bound or affected, or any order, rule or regulation of any court or governmental agency or body having jurisdiction over the Buyer.

 

5.4       Litigation. There are no actions, suits, proceedings or investigations pending or, to the best of the Company’s knowledge, threatened against or affecting the business or properties of the Company whether at law or in equity or admiralty or before or by any federal, state, municipal or other governmental department, commission, board, agency, court or instrumentality, domestic or foreign that would reasonably be expected to prohibit or restrain the ability of the Company to enter into this Agreement or consummate the transactions hereby.

 

6.           MISCELLANEOUS.

 

6.1       Binding Effect. This Agreement shall insure to the benefit of, and shall be binding upon, the parties hereto and their respective successors and permitted assigns. Except as otherwise set forth herein, this Agreement may not be assigned by any party hereto without the prior written consent of the Company and of the other parties hereto. Except as otherwise set forth herein, nothing in this Agreement, expressed or implied, is intended to confer on any person other than the parties hereto or their respective successors and permitted assigns any rights, remedies, obligations or liabilities under or by reason of this Agreement.

 

 3 

 

 

6.2      Notices. All notices, requests, demands and other communications which are required to be or may be given under this Agreement shall be in writing and shall be deemed to have been duly given when delivered in person, or transmitted by telecopy or telex, or upon receipt after dispatch by certified or registered first class mail, postage prepaid, return receipt requested, to the party to whom the same is so given or made, at the following addresses (or such others as shall be provided in writing hereinafter):

 

(a)If to the Seller, to:

 

Ervington Investments Limited

Emmanouil Roidi, 10-12

Agia Zoni, 3031, Limassol, Cyprus

Attention: Natalia Khudyk

 

(b)If to the Company, to:

 

Pledge Petroleum Corp.

11811 North Freeway, Suite 513

Houston, TX 77060

Attention: John Zotos

Email: zotozulu@mac.com 

 

  With a copy to:
   
  Leslie Marlow
  Gracin & Marlow, LLP
  405 Lexington Avenue, 26th Floor
  New York, New York 10174
  Facsimile: (212) 208-4657

Email: lmarlow@gracinmarlow.com

 

6.3     Entire Agreement. This Agreement and the related Escrow Agreement constitute the entire agreement and supersedes all prior agreements and understandings, oral and written, between the parties hereto with respect to the subject matter hereof, including but not limited to that certain Series C Preferred Stock Purchase Agreement, dated February 19, 2015, Investors’ Rights Agreement, dated February 19, 2015, and Stockholders Agreement, dated February 19, 2015.

 

6.4     Further Assurances. After the Closing, at the request of either party, the other party shall execute, acknowledge and deliver, without further consideration, all such further assignments, conveyances, endorsements, deeds, powers of attorney, consents and other documents and take such other action as may be reasonably requested to consummate the transactions contemplated by this Agreement, including, but not limited to, any documentation reasonably required by any banking institution to change the signatories on the Company’s bank accounts to the Company’s new designees.

 

6.5     Headings. The section and other headings contained in this Agreement are for reference purposes only and shall not be deemed to be a part of this Agreement or to affect the meaning or interpretation of this Agreement.

 

6.6     Counterparts. This Agreement may be executed in any number of counterparts, each of which, when executed, shall be deemed to be an original and all of which together shall be deemed to be one and the same instrument.

 

 4 

 

 

6.7     Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD TO ITS RULES OF CONFLICT OF LAWS. Each of the parties hereto (i) consents to submit itself to the personal jurisdiction of the Delaware Court of Chancery or, if such court does not have jurisdiction over a particular matter, any court of the United States located in the State of Delaware or of any Delaware state court in the event any dispute arises out of this Agreement or the Transactions, (ii) agrees that it will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such court, (c) agrees that it will not bring any action relating to this Agreement or the Transactions in any court other than a court of the United States located in the State of Delaware or a Delaware state court and (d) consents to service of process in the manner provided for in Section 6.2. EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (I) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (II) EACH SUCH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (III) EACH SUCH PARTY MAKES THIS WAIVER VOLUNTARILY, AND (IV) EACH SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

 

6.8     Severability. If any term or provision of this Agreement shall to any extent be invalid or unenforceable, the remainder of this Agreement shall not be affected thereby, and each term and provision of this Agreement shall be valid and enforced to the fullest extent permitted by law.

 

6.9     Amendments. This Agreement may not be modified or changed except by an instrument or instruments in writing executed by the parties hereto.

 

6.10       Publicity. None of the Seller, the Company or any of their respective affiliates shall issue any press release or make public announcement (including any filing with the U.S. Securities and Exchange Commission) concerning this Agreement or the transactions contemplated herein without obtaining the prior written approval of the other parties hereto, which approval will not be unreasonably withheld or delayed, unless the content of such press release or public announcement is substantially consistent in form and substance with the disclosures set forth in the Proxy Statement; provided that the party intending to make such release shall use its commercially reasonable efforts to consult with the other party with respect to the timing and content thereof.

 

 5 

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written.

 

  SELLER:
   
 

ERVINGTON INVESTMENTS LTD

 

   
  By:  /s/ Natalia Khudyk  
    Name: Natalia Khudyk  
    Title: Director  
     

 

 

 

COMPANY:

 

 
  PLEDGE PETROLEUM CORP.  
     
     
  By: /s/ John Zotos  
    Name: John Zotos  
    Title: Corporate Secretary  

 

  

 

 

 

 

 

 

 

Signature page to Stock Purchase Agreement

 

 6 

EX-31.1 4 tv482307_ex31-1.htm EXHIBIT 31.1

Exhibit 31.1

 

CERTIFICATION PURSUANT TO RULE 13a-14 OR RULE

 

15d-14 OF THE SECURITIES EXCHANGE ACT OF 1934,

 

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Ivan Persiyanov, certify that:

 

1.I have reviewed this Quarterly Report on Form 10-Q of Pledge Petroleum Corp.;

 

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, 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; and

 

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: February 12, 2018  
   
/s/ Ivan Persiyanov  
Ivan Persiyanov   
Chief Executive Officer and President  
(Principal Executive Officer)  

 

   

EX-31.2 5 tv482307_ex31-2.htm EXHIBIT 31.2

Exhibit 31.2

 

CERTIFICATION PURSUANT TO RULE 13a-14 OR RULE

 

15d-14 OF THE SECURITIES EXCHANGE ACT OF 1934,

 

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Ivan Persiyanov, certify that:

 

1.I have reviewed this Quarterly Report on Form 10-Q of Pledge Petroleum Corp.;

 

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; and

 

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: February 12, 2018  
   
/s/ Ivan Persiyanov  
Ivan Persiyanov  
Interim Chief Financial Officer  
(Principal Financial and Accounting Officer)  

 

   

EX-32.1 6 tv482307_ex32-1.htm EXHIBIT 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 Pledge Petroleum Corp., a Delaware corporation (the “Company”), on Form 10-Q for the period ended September 30, 2017 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Ivan Persiyanov, Chief Executive Officer and President of the Company, certify, pursuant to Section 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

 

(1)The Report fully complies with the requirements of Section 13(a) and 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 results of operations of the Company.

 

/s/ Ivan Persiyanov  
Ivan Persiyanov  
Chief Executive Officer and President  
(Principal Executive Officer)  
February 12, 2018  

 

   

EX-32.2 7 tv482307_ex32-2.htm EXHIBIT 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 Pledge Petroleum Corp., a Delaware corporation (the “Company”), on Form 10-Q for the period ended September 30, 2017 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Ivan Persiyanov, Interim Chief Financial Officer of the Company, certify, pursuant to Section 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

 

(1)The Report fully complies with the requirements of Section 13(a) and 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 results of operations of the Company.

 

/s/ Ivan Persiyanov  
Ivan Persiyanov  
Interim Chief Financial Officer  
(Principal Financial and Accounting Officer)  
   
February 12, 2018  

 

   

 

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Accordingly, these unaudited condensed financial statements do not include all of the information and disclosures required by U.S. GAAP for complete financial statements. In the opinion of management, the accompanying unaudited condensed financial statements include all adjustments (consisting only of normal recurring adjustments), which we consider necessary, for a fair presentation of those financial statements. The results of operations and cash flows for the three months and nine months ended September 30, 2017 may not necessarily be indicative of results that may be expected for any succeeding quarter or for the entire fiscal year. The information contained in this quarterly report on Form 10-Q should be read in conjunction with our audited financial statements included in our annual report on Form 10-K as of and for the year ended December 31, 2016 as filed with the Securities and Exchange Commission (the &#8220;SEC&#8221;).</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">Significant accounting policies are described in Note 2 to the consolidated financial statements included in Item 8 of our annual report on Form 10-K as of December 31, 2016.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">The preparation of unaudited consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions, which are evaluated on an ongoing basis, that affect the amounts reported in the unaudited consolidated financial statements and accompanying notes. Management bases its estimates on historical experience and on various other assumptions that it believes are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the amounts of revenues and expenses that are not readily apparent from other sources. Actual results could differ from those estimates and judgments. In particular, significant estimates and judgments include those related to: the estimated useful lives for plant and equipment, the fair value of warrants and stock options granted for services or compensation, estimates of the probability and potential magnitude of contingent liabilities, derivative liabilities, the valuation allowance for deferred tax assets due to continuing operating losses, those related to revenue recognition and the allowance for doubtful accounts.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the unaudited consolidated financial statements, which management considered in formulating its estimate could change in the near-term due to one or more future confirming events. Accordingly, the actual results could differ significantly from our estimates.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">All amounts referred to in the notes to the unaudited consolidated financial statements are in United States Dollars ($) unless stated otherwise.</div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><table cellpadding="0" cellspacing="0" style="clear:both;clear:both;font-family: &#34;Times New Roman&#34;, Times, serif; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-style: normal; font-variant: normal; font-weight: normal; font-stretch: normal; font-size: 10pt; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; display: table;" ><tr style="vertical-align: top;"><td style="width: 0.5in; font-size: 10pt;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">&#160;</div></td><td style="width: 0.25in; font-size: 10pt;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">b)</div></div></td><td style="font-size: 10pt; text-align: justify;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">Principles of Consolidation</div></div></td></tr></table><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">The unaudited consolidated financial statements include the financial statements of the Company and its subsidiaries in which it has a majority voting interest. All significant inter-company accounts and transactions have been eliminated in the unaudited consolidated financial statements. The entities included in these unaudited consolidated financial statements are as follows:</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px; text-align: justify; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">Pledge Petroleum Corp (formerly Propell Technologies Group, Inc.) &#150; Parent Company</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">Novas Energy USA Inc. (wholly owned)</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">Novas Energy North America, LLC (60% owned)&#160;&#150; Discontinued operation.</div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><table cellpadding="0" cellspacing="0" style="clear:both;clear:both;font-family: &#34;Times New Roman&#34;, Times, serif; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-style: normal; font-variant: normal; font-weight: normal; font-stretch: normal; font-size: 10pt; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; display: table;" ><tr style="vertical-align: top;"><td style="width: 0.5in; font-size: 10pt;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">&#160;</div></td><td style="width: 0.25in; font-size: 10pt;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">c)</div></div></td><td style="font-size: 10pt; text-align: justify;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">Recent Accounting Pronouncements</div></div></td></tr></table><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">In July 2017, the FASB issued Accounting Standards Update No. (&#8220;ASU&#8217;&#8217;) 2017-11, Earnings Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480) and Derivatives and Hedging (Topic 815). The amendments in this Update provide guidance about:</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">&#160;</div><table cellpadding="0" cellspacing="0" style="clear:both;clear:both;font-family: &#34;Times New Roman&#34;, Times, serif; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; font-stretch: normal; font-size: 10pt; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; width: 100%; display: table;" ><tr style="vertical-align: top; text-align: justify;"><td style="width: 0.75in;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"></div></td><td style="width: 0.25in; text-align: left;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">1.</div></td><td style="text-align: justify;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">Accounting for certain financial instruments with down round features</div></td></tr></table><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px;">&#160;</div><table cellpadding="0" cellspacing="0" style="clear:both;clear:both;font-family: &#34;Times New Roman&#34;, Times, serif; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; font-stretch: normal; font-size: 10pt; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; width: 100%; display: table;" ><tr style="vertical-align: top; text-align: justify;"><td style="width: 0.75in;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"></div></td><td style="width: 0.25in; text-align: left;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">2.</div></td><td style="text-align: justify;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">Replacement of the indefinite deferral for mandatorily redeemable financial instruments of certain non-public entities and certain non-controlling interests</div></td></tr></table><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">The amendments in Part I of this Update change the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity&#8217;s own stock. The amendments also clarify existing disclosure requirements for equity-classified instruments. As a result, a freestanding equity-linked financial instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. For freestanding equity classified financial instruments, the amendments require entities that present earnings per share (EPS) in accordance with Topic 260 to recognize the effect of the down round feature when it is triggered. That effect is treated as a dividend and as a reduction of income available to common shareholders in basic EPS. Convertible instruments with embedded conversion options that have down round features are now subject to the specialized guidance for contingent beneficial conversion features (in Subtopic 470-20, Debt&#151;Debt with Conversion and Other Options), including related EPS guidance (in Topic 260).</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">The amendments in Part II of this Update recharacterize the indefinite deferral of certain provisions of Topic 480 that now are presented as pending content in the Codification, to a scope exception. Those amendments do not have an accounting effect.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">The amendments in Part I of this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted for all entities, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. The amendments in Part 1 of this Update should be applied in either of the following ways: 1. Retrospectively to outstanding financial instruments with a down round feature by means of a cumulative-effect adjustment to the statement of financial position as of the beginning of the first fiscal year and interim period(s) in which the pending content that links to this paragraph is effective 2. Retrospectively to outstanding financial instruments with a down round feature for each prior reporting period presented in accordance with the guidance on accounting changes in paragraphs 250-10-45-5 through 45-10.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">The amendments in Part II of this Update do not require any transition guidance because those amendments do not have an accounting effect.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">The Company is currently evaluating the impact this ASU will have on its consolidated financial In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging, an amendment to Topic 815. The amendments in this Update better align an entity&#8217;s risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. To meet that objective, the amendments expand and refine hedge accounting for both nonfinancial and financial risk components 2 and align the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. The amendments in this Update require an entity to present the earnings effect of the hedging instrument in the same income statement line item in which the earnings effect of the hedged item is reported.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">The amendments in this Update are effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early application is permitted in any interim period after issuance of the Update. All transition requirements and elections should be applied to hedging relationships existing (that is, hedging relationships in which the hedging instrument has not expired, been sold, terminated, or exercised or the entity has not removed the designation of the hedging relationship) on the date of adoption. The effect of adoption should be reflected as of the beginning of the fiscal year of adoption. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">In September 2017, the FASB issued ASU 2017-13, Revenue Recognition (Topic 605), Revenue from Contracts with Customers (Topic 606), Leases (Topic 840), and Leases (Topic 842). The amendments in this ASU deals with the transition and effective dates of implementing to ASU 2014-09, Revenue from contracts with customers, ASU 2016-08, Revenue from contracts with customers, principal versus agent considerations, ASU 2016-10, revenues from contacts with customers; identifying performance obligations and licensing, ASU 2016-12, revenues from contacts with customers, narrow scope improvements and practical expedients, 2016-20, technical corrections and improvements and ASU 2017-05, other income, gains and losses from the derecognition of non-financial assets.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">The transition provisions require adoption of Topic 606 for annual reporting periods commencing after December 15, 2017 and the adoption of Topic 842 for annual reporting periods beginning after December 15, 2018 for public business entities, if the requirements of a public business entity as defined in ASU 2017-122 are not met, may adopt Topic 606 for annual reporting periods commencing after December 15, 2018 and for Topic 842 for annual reporting periods commencing after December 15, 2019. Early adoption is permitted of both Topics. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">Any new accounting standards, not disclosed above, that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the financial statements upon adoption.</div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><table cellpadding="0" cellspacing="0" style="clear:both;clear:both;font-family: &#34;Times New Roman&#34;, Times, serif; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-style: normal; font-variant: normal; font-weight: normal; font-stretch: normal; font-size: 10pt; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; display: table;" ><tr style="vertical-align: top;"><td style="width: 0.5in; font-size: 10pt;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">&#160;</div></td><td style="width: 0.25in; font-size: 10pt;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">d)</div></div></td><td style="font-size: 10pt; text-align: justify;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">Use of Estimates</div></div></td></tr></table><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">The preparation of unaudited consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions, which are evaluated on an ongoing basis, that affect the amounts reported in the unaudited consolidated financial statements and accompanying notes. Management bases its estimates on historical experience and on various other assumptions that it believes are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the amounts of revenues and expenses that are not readily apparent from other sources. Actual results could differ from those estimates and judgments. In particular, significant estimates and judgments include those related to: the estimated useful lives for plant and equipment, the fair value of warrants and stock options granted for services or compensation, estimates of the probability and potential magnitude of contingent liabilities, derivative liabilities, the valuation allowance for deferred tax assets due to continuing operating losses, those related to revenue recognition and the allowance for doubtful accounts.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the unaudited consolidated financial statements, which management considered in formulating its estimate could change in the near-term due to one or more future confirming events. Accordingly, the actual results could differ significantly from our estimates.</div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><table cellpadding="0" cellspacing="0" style="clear:both;clear:both;font-family: &#34;Times New Roman&#34;, Times, serif; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-style: normal; font-variant: normal; font-weight: normal; font-stretch: normal; font-size: 10pt; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; display: table;" ><tr style="vertical-align: top;"><td style="width: 0.5in; font-size: 10pt;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">&#160;</div></td><td style="width: 0.25in; font-size: 10pt;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">e)</div></div></td><td style="font-size: 10pt; text-align: justify;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">Contingencies</div></div></td></tr></table><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company&#8217;s management assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company&#8217;s financial statements. If the assessment indicates that a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material would be disclosed. Loss contingencies considered to be remote by management are generally not disclosed unless they involve guarantees, in which case the guarantee would be disclosed.</div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><table cellpadding="0" cellspacing="0" style="clear:both;clear:both;font-family: &#34;Times New Roman&#34;, Times, serif; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-style: normal; font-variant: normal; font-weight: normal; font-stretch: normal; font-size: 10pt; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; display: table;" ><tr style="vertical-align: top;"><td style="width: 0.5in; font-size: 10pt;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">&#160;</div></td><td style="width: 0.25in; font-size: 10pt;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">f)</div></div></td><td style="font-size: 10pt; text-align: justify;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">Cash and Cash Equivalents</div></div></td></tr></table><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">The Company considers all highly liquid investments with original maturities of three months or less at the time of purchase to be cash equivalents. At September 30, 2017 and December 31, 2016, respectively, the Company had no cash equivalents.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">The Company assesses credit risk associated with cash by periodically evaluating the credit quality of its primary financial institution. The balance at times may exceed federally insured limits. At September 30, 2017, the Company had cash balances of $8,755,803, which exceeded the federally insured limits by $8,450,408.</div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt"><table cellpadding="0" cellspacing="0" style="clear:both;clear:both;font-family: &#34;Times New Roman&#34;, Times, serif; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; font-stretch: normal; font-size: 10pt; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; width: 100%; border: 0px solid;"><tr style="vertical-align: top; text-align: justify;"><td style="width: 0px;;"><div></div></td><td style="width: 0.5in; text-align: left;;"><div><div style="CLEAR:both;font-weight:bold;display:inline;">2</div></div></td><td style="text-align: justify;;"><div><div style="CLEAR:both;font-weight:bold;display:inline;">GOING CONCERN</div></div></td></tr></table></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.25in;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">The Company has cash balances of $8,755,803 as of September 30, 2017, which is sufficient to meet current expenses for at least the next twelve month period, however the Board of Directors are considering various options as to the future direction of the Company, including the possible sale of its technology and PPT assets. The Company formed a special committee to investigate a possible share buyback of the majority stockholder, Ervington Investments Limited, and/or a possible dissolution of the Company.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">Due to uncertainties surrounding the Company&#8217;s ability to realize the full value of its assets, the Company cannot make any assurances regarding the amount available for distribution to its stockholders.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">The Company has made certain projections relating to the amount of cash it expects to have to distribute to its stockholders upon dissolution of the Company. These projections generally relate to the amount of liabilities which must be satisfied before the Company is dissolved and the amount its preferred stockholders is expected to receive for their equity interest. The above projections are subject to multiple variables, including the timing of a dissolution affecting the amount of dividends payable and the amount of liabilities owed at the time of dissolution. 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table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">The assets and liabilities of discontinued operations as of September 30, 2017 and December 31, 2016, respectively is as follows:</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New 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style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">December&#160;31,<br/>2016</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">Current assets</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Cash</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">19,480</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">19,480</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Accounts receivable, net</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">61,661</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">61,661</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Prepaid expenses and other current assets</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">29,896</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">29,896</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#cceeff">Total current assets</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">111,037</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">111,037</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">Non-current assets</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" 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style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">6,480</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Total assets</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">117,517</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">117,517</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">Current liabilities</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" 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style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">932,478</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Accrued liabilities and other payables</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">115,971</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">115,971</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Total liabilities</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">1,143,233</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1,025,716</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1,025,716</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr> </table></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; 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roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Net revenue</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">48,560</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">196,328</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Cost of goods sold</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">35,543</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new 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width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Sales and marketing expenses</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" 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style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">11,729</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Professional fees</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">20,573</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">57,496</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Business development</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">145,319</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">230,268</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">802,460</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">General and administrative expenses</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">137,340</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">457,876</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Depreciation and amortization</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">477</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">1,280</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#cceeff">Total expense</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">389,506</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1,476,160</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">Loss from operations</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">(353,963)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">(1,419,782)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Loss on discontinuance of subsidiary</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(9,377)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(9,377)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">992</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Other income</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">10</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">Loss from discontinued operations</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">(363,421)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1,428,157</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td></tr> </table></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><table cellpadding="0" cellspacing="0" style="clear:both;clear:both;font-family: &#34;Times New Roman&#34;, Times, serif; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; font-stretch: normal; font-size: 10pt; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; width: 100%;"><tr style="vertical-align: top; text-align: justify;"><td style="width: 0.5in; text-align: left;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">4</div></div></td><td style="text-align: justify;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">PREPAID EXPENSES</div></div></td></tr></table><div style="CLEAR:both;CLEAR:both; 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start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in;">Prepaid expenses consisted of the following:</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 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style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">September&#160;30,<br/>2017</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">December&#160;31,<br/>2016</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Prepaid insurance</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="11%" style="overflow:hidden;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">13,851</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">22,607</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Prepaid professional fees</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">5,833</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">3,333</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="11%" style="overflow:hidden;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">19,684</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">25,940</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr> </table></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in;">Prepaid expenses consisted of the following:</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: 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style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">September&#160;30,<br/>2017</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">December&#160;31,<br/>2016</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Prepaid insurance</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="11%" style="overflow:hidden;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">13,851</td><td 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style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="11%" style="overflow:hidden;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">19,684</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">25,940</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr> </table></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" 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font-stretch: normal; line-height: normal; margin: 0px 0px 0px 31.5pt;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; float: none; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: 400;"><table cellspacing="0" cellpadding="0" style="clear:both;clear:both;width:92%;float: inherit;border-collapse:collapse;border-width:92%;float: inherit;MARGIN: 0in 0in 0in 0.5in;" align="left"> <tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="38%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="8" rowspan="1">September&#160;30,<br/>2017</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">December&#160;31,<br/>2016</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Cost</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Amortization<br/>and&#160;Impairment</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Net&#160;book&#160;value</td><td width="1%" 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style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Plasma pulse tool</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times 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width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Furniture and equipment</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">6,700</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">(2,122)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" 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style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new 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style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">982,880</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">10,198</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">$</td><td width="11%" 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rowspan="1">Net&#160;book&#160;value</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Net&#160;book&#160;value</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Website development</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" 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style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">358,000</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">(358,000)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr> </table></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> 358000 358000 0 0 1458333 1000000 <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><table cellpadding="0" cellspacing="0" style="clear:both;clear:both;font-family: &#34;Times New Roman&#34;, Times, serif; letter-spacing: normal; orphans: 2; text-indent: 0px; 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400;"><table cellspacing="0" cellpadding="0" style="clear:both;clear:both;width:92%;float: inherit;border-collapse:collapse;border-width:92%;float: inherit;MARGIN: 0in 0in 0in 0.5in;" align="left"> <tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">September&#160;30,<br/>2017</td><td width="1%" 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style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Royalties payable</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">14,653</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">14,653</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Severance accrual</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">19,814</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" 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roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">34,467</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr> </table></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; 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reduction exercise.</div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: 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cellpadding="0" style="clear:both;clear:both;width:92%;float: inherit;border-collapse:collapse;border-width:92%;float: inherit;MARGIN: 0in 0in 0in 0.5in;" align="left"> <tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">September&#160;30,<br/>2017</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">December&#160;31,<br/>2016</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Royalties payable</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">14,653</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">14,653</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Other</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">207</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Severance accrual</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">19,814</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">14,860</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">34,467</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr> </table></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> 14860 34467 <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 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justify;;"><div><div style="CLEAR:both;font-weight:bold;display:inline;">SUBSEQUENT EVENTS</div></div></td></tr></table><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px;"><div style="display:inline;; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;display1:inline;display1:inline;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;">&#160;</div></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px 0pt 0.5in; text-align: justify;"><div style="display:inline;; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;display1:inline;display1:inline;">The Company has entered into an Asset Purchase Agreement (the &#8220;Asset Purchase Agreement&#8221;) with an affiliate (the &#8220;Purchaser&#8221;) of Ervington Investment Limited (&#8220;Ervington&#8221;), the current holder of a majority of the Company&#8217;s outstanding voting securities, pursuant to which the Company has agreed to sell to the Purchaser substantially all of its assets, including all pertinent intellectual property rights, comprising its business of implementing its plasma pulse technology, for $650,000 (the &#8220;Asset Sale&#8221;).&#160; The Asset Purchase Agreement provides, among other things, that the Asset Sale is conditioned on its approval by holders of a majority of the Company&#8217;s voting securities, exclusive of the securities held by Ervington (a &#8220;majority of the minority&#8221;).</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="display:inline;; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;display1:inline;display1:inline;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px 0pt 0.5in; text-align: justify;"><div style="display:inline;; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;display1:inline;display1:inline;">The Company has also entered into an agreement with Ervington (the &#8220;Share Repurchase Agreement&#8221;) to repurchase all of its outstanding securities held by Ervington for $8,500,000 (the &#8220;Share Repurchase&#8221;), which repurchase will occur at the same time as the Asset Sale.&#160; The repurchase will constitute a change of control and upon consummation of the repurchase, Ivan Persiyanov, will resign from all positions he holds as an officer and director of the Company and its subsidiaries. After the completion of the Asset Sale, the Company expects to cease all activities related to its existing business while evaluating other business opportunities, which include potentially acquiring an oilfield services business, of which two of the Company&#8217;s current directors (Messrs. Huemoeller and Zotos) own a minority equity interest. The Company has not entered into an agreement with any potential acquisition candidate and has only been in the early stages of discussion.</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="display:inline;; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;display1:inline;display1:inline;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px 0pt 0.5in; text-align: justify;"><div style="display:inline;; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;display1:inline;display1:inline;">The purchase price for the shares being repurchased and assets being sold together with documents necessary to effect the Asset Sale pursuant to the Asset Purchase Agreement and the Share Repurchase pursuant to the Share Repurchase Agreement, including, but not limited to, a bill of sale for the assets being sold, an assignment of intellectual property rights, stock certificates and stock powers for the shares to be repurchased from Ervington, and the resignation of Ivan Persiyanov, have been placed in escrow pending the approval of the Asset Sale by a majority of the minority and will be released at the subsequent closing of the transactions contemplated by the Asset Purchase Agreement and Share Repurchase Agreement.</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px 0pt 0.5in; text-align: justify;"><div style="display:inline;; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;display1:inline;display1:inline;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px 0pt 0.5in; text-align: justify;"><div style="display:inline;; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;display1:inline;display1:inline;">Other than disclosed above, in accordance with ASC 855-10, the Company has analyzed its operations subsequent to September 30, 2017 to the date these financial statements were issued, and has determined that it does not have any material subsequent events to disclose in these financial statements.</div></div></div><div style="display:inline;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: 400;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;"></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><table cellpadding="0" cellspacing="0" style="clear:both;clear:both;font-family: &#34;Times New Roman&#34;, Times, serif; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; font-stretch: normal; font-size: 10pt; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; width: 100%; border: 0px solid;"><tr style="vertical-align: top; text-align: justify;"><td style="width: 0px;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"></div></td><td style="width: 0.5in; text-align: left;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">9</div></div></td><td style="text-align: justify;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">OTHER INCOME</div></div></td></tr></table><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; float: none; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: 400;"><table cellspacing="0" cellpadding="0" style="clear:both;clear:both;width: 92%; border-collapse: collapse; float: inherit; margin: 0in 0in 0in 0.5in; border: 0px solid;" align="left"> <tr style="height:12px;"> <td width="43%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Three<br/>months<br/>ended&#160;30<br/>September&#160;2017</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" 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new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Nine&#160;months<br/>ended<br/>September&#160;30,<br/>2016</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="43%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="43%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Other income</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">4,059</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">203,296</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr> </table></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in;"><div style="display:inline;font-size: 13.3333px; background-color: transparent; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">Other income in the prior period includes the forgiveness of the $</div>200,000<div style="display:inline;font-size: 13.3333px; background-color: transparent; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"> license fee due to Novas BVI during the prior period.</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; 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roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Three<br/>months<br/>ended&#160;30<br/>September&#160;2016</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Nine&#160;months<br/>ended<br/>September&#160;30,<br/>2017</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Nine&#160;months<br/>ended<br/>September&#160;30,<br/>2016</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="43%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="43%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Other income</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">4,059</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">203,296</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr> </table></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> 200000 162095448 166095448 <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt"><table cellpadding="0" cellspacing="0" style="clear:both;clear:both;font-family: &#34;Times New Roman&#34;, Times, serif; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-style: normal; font-variant-ligatures: 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text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">On January 1, 2016, the &#8220;Company entered into a three-year Employment Agreement with C. Brian Boutte (the &#8220;Boutte Employment Agreement&#8221;) to serve as the Company&#8217;s Chief Executive Officer. Mr. Boutte was to also serve as the Company&#8217;s interim Chief Financial Officer. Under the Boutte Employment Agreement, for his service as the Chief Executive Officer of the Company, Mr. Boutte was to receive an annual base salary of $265,000, a sign on bonus of $60,000 and an annual performance bonus of up to 55% of his base salary, such bonus payable in cash or equity upon attainment of certain performance indicators established by the Company&#8217;s Board of Directors and Mr. Boutte. In connection with the entry into the Boutte Employment Agreement, Mr. Boutte was granted an option award exercisable for 3,000,000 shares of the Company&#8217;s common stock, which will vest as to 1,000,000 shares on each of the one, two and three-year anniversary of the commencement of his employment with the Company. The Boutte Employment Agreement was amended on December 31, 2016 to provide for a term of six months ending June 30, 2017, a reduced annual base salary of $165,000 and a provision for immediate vesting of the options upon a Change of Control (as defined in the amendment). In the event that Mr. Boutte&#8217;s employment was terminated Without Cause (as defined in the Boutte Employment Agreement), by Mr. Boutte for Good Reason (as defined below), Disability (as defined in the Boutte Employment Agreement), upon his death or a change in control, Mr. Boutte would be entitled to receive a severance payment equal to $65,000. Upon a change in control, Mr. Boutte&#8217;s options would immediately vest. The Boutte Employment Agreement also included customary confidentiality obligations and inventions assignments by Mr. Boutte as well as a non- compete and non-solicitation provision. If his employment was terminated for Cause (as defined below) or by him Without Good Reason (as defined in the Boutte Employment Agreement), Mr. Boutte was entitled to receive his annual base salary through the date of termination and any bonus earned but unpaid. For purposes of the Boutte Employment Agreement, &#8220;Good Reason&#8221; is defined as (i) any material and substantial breach of the Boutte Employment Agreement by the Company; (ii) a Change in Control (as defined in the Boutte Employment Agreement) occurs and Mr. Boutte&#8217;s employment is terminated; (iii) a reduction in Mr. Boutte&#8217;s Annual Base Salary as in effect at the time in question, or any other failure by the Company to comply with the compensation terms of the Boutte Employment Agreement; or (iv) the Boutte Employment Agreement is not assumed by a successor to the Company. For purpose of the Boutte Employment Agreement, &#8220;Cause&#8221; is defined as (i) acts of embezzlement or misappropriation of funds or fraud; (ii) conviction of a felony or other crime involving moral turpitude, dishonesty or theft; (iii) a material violation by Mr. Boutte of any provision of the Boutte Employment Agreement, including willful failure to perform assigned tasks, willful and unauthorized disclosure of Company material confidential information; (iv) being under the influence of drugs (other than prescription medicine or other medically related drugs to the extent that they are taken in accordance with their directions) during the performance of Mr. Boutte&#8217;s duties and that performance of his duties is affected; (v) engaging in behavior that would constitute grounds for liability for harassment (as proscribed by the U.S. Equal Employment Opportunity Commission Guidelines or any other applicable state or local regulatory body) or other egregious conduct that violates laws governing the workplace; or (vi) willful failure to perform his assigned tasks, where such failure is attributable to the fault of Mr. Boutte, gross insubordination or dereliction of fiduciary obligations which, to the extent it is curable by Mr. Boutte, is not cured by Mr. Boutte within thirty (30) days of receiving written notice of such violation by the Company.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">Mr. Boutte tendered his resignation to the Board of Directors on March 31, 2017.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;"></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">In terms of the license agreement commitments disclosed in note 6 above, the minimum commitments due under the amended license agreement entered into on January 30, 2013, for the next five years, are summarized as follows:</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; float: none; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: 400;"><table cellspacing="0" cellpadding="0" style="clear:both;clear:both;width: 92%; border-collapse: collapse; float: inherit; margin: 0in 0in 0in 0.5in; border: 0px solid;" align="left"> <tr style="height:12px;"> <td width="75%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="15%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Amount</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="75%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="75%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">2017</td><td width="1%" 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">2020</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">500,000</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="75%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">2021</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">500,000</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="75%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">Total</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">$</td><td width="14%" 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roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="16%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="38%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">Outstanding January 1, 2016</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">380,950</td><td width="1%" 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(1,000,000)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="16%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$0.08</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="16%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:top;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="16%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="38%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">Outstanding September 30, 2017</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" 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style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr> </table></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; 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roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Weighted<br/>average&#160;exercise<br/>price</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td 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roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">3,480</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">12.50</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">2,000</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">3.03</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">8.50</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">500</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">3.75</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">500</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">5.00</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">14,800</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">4.04</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">14,800</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">0.65</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">36,924</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">5.50</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">36,924</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">0.63</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">38,096</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">0.75</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">38,096</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">0.51</td><td width="1%" 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style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">2.54</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">285,150</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new 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style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">380,950</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="14%" 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roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">0.90</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr> </table></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in;">The warrants outstanding and exercisable at September 30, 2017 are as follows:</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times 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style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="44%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="8" rowspan="1">Warrants&#160;outstanding</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="28%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="5" rowspan="1">Warrants&#160;exercisable</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="13%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Exercise&#160;price</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">No.&#160;of&#160;shares</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="15%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Weighted<br/>average<br/>remaining&#160;years</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Weighted<br/>average&#160;exercise<br/>price</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">No.&#160;of&#160;shares</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Weighted<br/>average<br/>exercise&#160;price</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">0.30</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">375,000</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1.08</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">375,000</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">0.25</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">1,751,667</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">1.74</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">1,751,667</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">0.15</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">525,500</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1.74</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">525,500</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">0.25</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">1,508,333</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">1.84</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">1,508,333</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">0.15</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">577,499</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1.85</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">577,499</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">0.25</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">968,166</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">1.85</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">968,166</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">0.25</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">633,333</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="14%" 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new 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roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">6,339,498</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new 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400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">COMMITMENTS AND CONTINGENCIES</div></div></td></tr></table><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px; text-indent: 0.25in;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; 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text-align: justify; margin-left: 0in !important; display: inline !important; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;"><div style="display:inline;margin-right: 0px; font-size: 13.3333px; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 700;"><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;text-indent: 0in; font-size: 13.3333px; font-variant-numeric: normal; font-variant-east-asian: normal; font-weight: 400; margin-top: 0px; margin-right: 0px; margin-bottom: 0px; text-align: justify; margin-left: 0in !important; display: inline !important; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;"><div style="display:inline;margin-right: 0px; font-size: 13.3333px; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 700;"><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;text-indent: 0in; font-size: 13.3333px; font-variant-numeric: normal; font-variant-east-asian: normal; font-weight: 400; font-stretch: normal; line-height: normal; margin-top: 0px; margin-right: 0px; margin-bottom: 0px; text-align: justify; list-style-position: inside; margin-left: 0in !important; display: inline !important; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif;"><div style="display:inline;font-size: 13.3333px; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">The Company entered into a lease agreement for approximately </div>3,733<div style="display:inline;font-size: 13.3333px; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"> square feet of office and warehouse space in Houston, the term of the lease was for </div>39<div style="display:inline;font-size: 13.3333px; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"> months commencing on </div>March 1, 2016<div style="display:inline;font-size: 13.3333px; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"> and terminating on </div>May 31, 2019<div style="display:inline;font-size: 13.3333px; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">. The lease provided for the first month to be rent free, the fourteenth month to be rent free and the twenty-seventh month to be rent free. Monthly rentals, including estimated operating costs, for the first 12 months, excluding the free rental month amounted to approximately $</div>3,410<div style="display:inline;font-size: 13.3333px; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"> per month, escalating at a rate of </div>1.7<div style="display:inline;font-size: 13.3333px; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">% per annum, after excluding the free rental months. This lease agreement was amended, and the lease terminated with effect from May 31, 2017 with a final payment of $</div>2,000<div style="display:inline;font-size: 13.3333px; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"> and the forfeiture of the security deposit of $</div>6,968<div style="display:inline;font-size: 13.3333px; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">.</div></div></div></div></div></div></div></div></div></div></div></div></div></div></div></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;"><div style="display:inline;margin-right: 0px; font-size: 13.3333px; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 700;"><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-size: 13.3333px; font-variant-numeric: normal; font-variant-east-asian: normal; font-weight: 400; text-indent: 0px; font-stretch: normal; line-height: normal; margin-top: 0px; margin-right: 0px; margin-bottom: 0px; text-align: justify; margin-left: 0in !important; display: inline !important; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif;"><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-size: 13.3333px; font-variant-numeric: normal; font-variant-east-asian: normal; font-stretch: normal; line-height: normal; margin-top: 0px; margin-right: 0px; margin-bottom: 0px; display: inline; margin-left: 0in !important; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="display:inline;font-size: 13.3333px; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><br/></div></div></div></div></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;"><div style="display:inline;margin-right: 0px; font-size: 13.3333px; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 700;"><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-size: 13.3333px; font-variant-numeric: normal; font-variant-east-asian: normal; font-weight: 400; text-indent: 0px; font-stretch: normal; line-height: normal; margin-top: 0px; margin-right: 0px; margin-bottom: 0px; text-align: justify; margin-left: 0in !important; display: inline !important; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif;"><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-size: 13.3333px; font-variant-numeric: normal; font-variant-east-asian: normal; font-stretch: normal; line-height: normal; margin-top: 0px; margin-right: 0px; margin-bottom: 0px; display: inline; margin-left: 0in !important; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="display:inline;font-size: 13.3333px; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">The Company entered into an Office Service Agreement on May 16, 2017 whereby it has the license to use an office in a business center, together with all telecommunication services and access to conference rooms, kitchens and all utilities, the agreement is for a period of six months commencing on June 1, 2017 and terminating on</div><div style="display:inline;font-size: 13.3333px; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"> November 30, 2017. 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style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; 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justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; float: none; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: 400;"><table cellspacing="0" cellpadding="0" style="clear:both;clear:both;width: 92%; border-collapse: collapse; float: inherit; margin: 0in 0in 0in 0.5in; border: 0px solid;" align="left"> <tr style="height:12px;"> <td width="75%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="15%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Amount</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="75%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="75%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">2017</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">500,000</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="75%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">2018</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">500,000</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="75%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">2019</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">500,000</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="75%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">2020</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">500,000</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="75%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">2021</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">500,000</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="75%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">Total</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">$</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">2,500,000</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr> </table></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><table cellpadding="0" cellspacing="0" style="clear:both;clear:both;font-family: &#34;Times New Roman&#34;, Times, serif; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; font-stretch: normal; font-size: 10pt; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; width: 100%; display: table;" ><tr style="vertical-align: top; text-align: justify;"><td style="width: 0px;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"></div></td><td style="width: 0.5in; text-align: left;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">1</div></div></td><td style="text-align: justify;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">ACCOUNTING POLICIES AND ESTIMATES</div></div></td></tr></table><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><table cellpadding="0" cellspacing="0" style="clear:both;clear:both;font-family: &#34;Times New Roman&#34;, Times, serif; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-style: normal; font-variant: normal; font-weight: normal; font-stretch: normal; font-size: 10pt; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; display: table;" ><tr style="vertical-align: top; text-align: justify;"><td style="width: 0.5in;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"></div></td><td style="width: 0.25in; text-align: left;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">a)</div></div></td><td style="text-align: justify;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">Basis of Presentation</div></div></td></tr></table><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">The accompanying unaudited condensed financial statements have been prepared in accordance with U.S. generally accepted accounting principles (&#8220;U.S. GAAP&#8221;) for interim financial information with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X. Accordingly, these unaudited condensed financial statements do not include all of the information and disclosures required by U.S. GAAP for complete financial statements. In the opinion of management, the accompanying unaudited condensed financial statements include all adjustments (consisting only of normal recurring adjustments), which we consider necessary, for a fair presentation of those financial statements. The results of operations and cash flows for the three months and nine months ended September 30, 2017 may not necessarily be indicative of results that may be expected for any succeeding quarter or for the entire fiscal year. The information contained in this quarterly report on Form 10-Q should be read in conjunction with our audited financial statements included in our annual report on Form 10-K as of and for the year ended December 31, 2016 as filed with the Securities and Exchange Commission (the &#8220;SEC&#8221;).</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">Significant accounting policies are described in Note 2 to the consolidated financial statements included in Item 8 of our annual report on Form 10-K as of December 31, 2016.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">The preparation of unaudited consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions, which are evaluated on an ongoing basis, that affect the amounts reported in the unaudited consolidated financial statements and accompanying notes. Management bases its estimates on historical experience and on various other assumptions that it believes are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the amounts of revenues and expenses that are not readily apparent from other sources. Actual results could differ from those estimates and judgments. In particular, significant estimates and judgments include those related to: the estimated useful lives for plant and equipment, the fair value of warrants and stock options granted for services or compensation, estimates of the probability and potential magnitude of contingent liabilities, derivative liabilities, the valuation allowance for deferred tax assets due to continuing operating losses, those related to revenue recognition and the allowance for doubtful accounts.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the unaudited consolidated financial statements, which management considered in formulating its estimate could change in the near-term due to one or more future confirming events. Accordingly, the actual results could differ significantly from our estimates.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">All amounts referred to in the notes to the unaudited consolidated financial statements are in United States Dollars ($) unless stated otherwise.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); 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font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">The unaudited consolidated financial statements include the financial statements of the Company and its subsidiaries in which it has a majority voting interest. All significant inter-company accounts and transactions have been eliminated in the unaudited consolidated financial statements. The entities included in these unaudited consolidated financial statements are as follows:</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px; text-align: justify; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">Pledge Petroleum Corp (formerly Propell Technologies Group, Inc.) &#150; Parent Company</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">Novas Energy USA Inc. (wholly owned)</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">Novas Energy North America, LLC (60% owned)&#160;&#150; Discontinued operation.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px;">&#160;<div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><table cellpadding="0" cellspacing="0" style="clear:both;clear:both;font-family: &#34;Times New Roman&#34;, Times, serif; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-style: normal; font-variant: normal; font-weight: normal; font-stretch: normal; font-size: 10pt; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; display: table;" ><tr style="vertical-align: top;"><td style="width: 0.5in; font-size: 10pt;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">&#160;</div></td><td style="width: 0.25in; font-size: 10pt;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">c)</div></div></td><td style="font-size: 10pt; text-align: justify;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">Recent Accounting Pronouncements</div></div></td></tr></table><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">In July 2017, the FASB issued Accounting Standards Update No. (&#8220;ASU&#8217;&#8217;) 2017-11, Earnings Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480) and Derivatives and Hedging (Topic 815). The amendments in this Update provide guidance about:</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">&#160;</div><table cellpadding="0" cellspacing="0" style="clear:both;clear:both;font-family: &#34;Times New Roman&#34;, Times, serif; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-style: normal; font-variant-ligatures: normal; 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font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px;">&#160;</div><table cellpadding="0" cellspacing="0" style="clear:both;clear:both;font-family: &#34;Times New Roman&#34;, Times, serif; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; font-stretch: normal; font-size: 10pt; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; width: 100%; display: table;" ><tr style="vertical-align: top; text-align: justify;"><td style="width: 0.75in;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"></div></td><td style="width: 0.25in; text-align: left;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">2.</div></td><td style="text-align: justify;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">Replacement of the indefinite deferral for mandatorily redeemable financial instruments of certain non-public entities and certain non-controlling interests</div></td></tr></table><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">The amendments in Part I of this Update change the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity&#8217;s own stock. The amendments also clarify existing disclosure requirements for equity-classified instruments. As a result, a freestanding equity-linked financial instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. For freestanding equity classified financial instruments, the amendments require entities that present earnings per share (EPS) in accordance with Topic 260 to recognize the effect of the down round feature when it is triggered. That effect is treated as a dividend and as a reduction of income available to common shareholders in basic EPS. Convertible instruments with embedded conversion options that have down round features are now subject to the specialized guidance for contingent beneficial conversion features (in Subtopic 470-20, Debt&#151;Debt with Conversion and Other Options), including related EPS guidance (in Topic 260).</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">The amendments in Part II of this Update recharacterize the indefinite deferral of certain provisions of Topic 480 that now are presented as pending content in the Codification, to a scope exception. Those amendments do not have an accounting effect.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">The amendments in Part I of this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted for all entities, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. The amendments in Part 1 of this Update should be applied in either of the following ways: 1. Retrospectively to outstanding financial instruments with a down round feature by means of a cumulative-effect adjustment to the statement of financial position as of the beginning of the first fiscal year and interim period(s) in which the pending content that links to this paragraph is effective 2. Retrospectively to outstanding financial instruments with a down round feature for each prior reporting period presented in accordance with the guidance on accounting changes in paragraphs 250-10-45-5 through 45-10.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">The amendments in Part II of this Update do not require any transition guidance because those amendments do not have an accounting effect.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">The Company is currently evaluating the impact this ASU will have on its consolidated financial In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging, an amendment to Topic 815. The amendments in this Update better align an entity&#8217;s risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. To meet that objective, the amendments expand and refine hedge accounting for both nonfinancial and financial risk components 2 and align the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. The amendments in this Update require an entity to present the earnings effect of the hedging instrument in the same income statement line item in which the earnings effect of the hedged item is reported.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">The amendments in this Update are effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early application is permitted in any interim period after issuance of the Update. All transition requirements and elections should be applied to hedging relationships existing (that is, hedging relationships in which the hedging instrument has not expired, been sold, terminated, or exercised or the entity has not removed the designation of the hedging relationship) on the date of adoption. The effect of adoption should be reflected as of the beginning of the fiscal year of adoption. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">In September 2017, the FASB issued ASU 2017-13, Revenue Recognition (Topic 605), Revenue from Contracts with Customers (Topic 606), Leases (Topic 840), and Leases (Topic 842). The amendments in this ASU deals with the transition and effective dates of implementing to ASU 2014-09, Revenue from contracts with customers, ASU 2016-08, Revenue from contracts with customers, principal versus agent considerations, ASU 2016-10, revenues from contacts with customers; identifying performance obligations and licensing, ASU 2016-12, revenues from contacts with customers, narrow scope improvements and practical expedients, 2016-20, technical corrections and improvements and ASU 2017-05, other income, gains and losses from the derecognition of non-financial assets.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">The transition provisions require adoption of Topic 606 for annual reporting periods commencing after December 15, 2017 and the adoption of Topic 842 for annual reporting periods beginning after December 15, 2018 for public business entities, if the requirements of a public business entity as defined in ASU 2017-122 are not met, may adopt Topic 606 for annual reporting periods commencing after December 15, 2018 and for Topic 842 for annual reporting periods commencing after December 15, 2019. Early adoption is permitted of both Topics. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">Any new accounting standards, not disclosed above, that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the financial statements upon adoption.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;"></div><div style="CLEAR:both;CLEAR:both; 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display: table;" ><tr style="vertical-align: top;"><td style="width: 0.5in; font-size: 10pt;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">&#160;</div></td><td style="width: 0.25in; font-size: 10pt;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">d)</div></div></td><td style="font-size: 10pt; text-align: justify;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">Use of Estimates</div></div></td></tr></table><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">The preparation of unaudited consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions, which are evaluated on an ongoing basis, that affect the amounts reported in the unaudited consolidated financial statements and accompanying notes. Management bases its estimates on historical experience and on various other assumptions that it believes are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the amounts of revenues and expenses that are not readily apparent from other sources. Actual results could differ from those estimates and judgments. In particular, significant estimates and judgments include those related to: the estimated useful lives for plant and equipment, the fair value of warrants and stock options granted for services or compensation, estimates of the probability and potential magnitude of contingent liabilities, derivative liabilities, the valuation allowance for deferred tax assets due to continuing operating losses, those related to revenue recognition and the allowance for doubtful accounts.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the unaudited consolidated financial statements, which management considered in formulating its estimate could change in the near-term due to one or more future confirming events. Accordingly, the actual results could differ significantly from our estimates.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px;">&#160;</div><table cellpadding="0" cellspacing="0" style="clear:both;clear:both;font-family: &#34;Times New Roman&#34;, Times, serif; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-style: normal; font-variant: normal; font-weight: normal; font-stretch: normal; font-size: 10pt; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; display: table;" ><tr style="vertical-align: top;"><td style="width: 0.5in; font-size: 10pt;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">&#160;</div></td><td style="width: 0.25in; font-size: 10pt;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">e)</div></div></td><td style="font-size: 10pt; text-align: justify;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">Contingencies</div></div></td></tr></table><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company&#8217;s management assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company&#8217;s financial statements. If the assessment indicates that a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material would be disclosed. Loss contingencies considered to be remote by management are generally not disclosed unless they involve guarantees, in which case the guarantee would be disclosed.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px;">&#160;&#160;</div><table cellpadding="0" cellspacing="0" style="clear:both;clear:both;font-family: &#34;Times New Roman&#34;, Times, serif; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-style: normal; font-variant: normal; font-weight: normal; font-stretch: normal; font-size: 10pt; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; display: table;" ><tr style="vertical-align: top;"><td style="width: 0.5in; font-size: 10pt;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">&#160;</div></td><td style="width: 0.25in; font-size: 10pt;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">f)</div></div></td><td style="font-size: 10pt; text-align: justify;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">Cash and Cash Equivalents</div></div></td></tr></table><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">The Company considers all highly liquid investments with original maturities of three months or less at the time of purchase to be cash equivalents. At September 30, 2017 and December 31, 2016, respectively, the Company had no cash equivalents.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">The Company assesses credit risk associated with cash by periodically evaluating the credit quality of its primary financial institution. The balance at times may exceed federally insured limits. At September 30, 2017, the Company had cash balances of $8,755,803, which exceeded the federally insured limits by $8,450,408.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: 400;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px;">&#160;</div><table cellpadding="0" cellspacing="0" style="clear:both;clear:both;font-family: &#34;Times New Roman&#34;, Times, serif; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-style: normal; font-variant: normal; font-weight: normal; font-stretch: normal; font-size: 10pt; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; display: table;" ><tr style="vertical-align: top;"><td style="width: 0.5in; font-size: 10pt;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">&#160;</div></td><td style="width: 0.25in; font-size: 10pt;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">g)</div></div></td><td style="font-size: 10pt; text-align: justify;;"><div style="CLEAR:both;CLEAR:both;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">Related parties</div></div></td></tr></table><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">Parties are considered to be related to the Company if the parties that, directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company, or own in aggregate, on a fully diluted basis 5% or more of the Company&#8217;s stock. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. The Company discloses all related party transactions. All transactions are recorded at fair value of the goods or services exchanged. Property purchased from a related party is recorded at the cost to the related party and any payment to or on behalf of the related party in excess of the cost is reflected as a distribution to related party.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;"><br/></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant: normal; 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font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">Parties are considered to be related to the Company if the parties that, directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company, or own in aggregate, on a fully diluted basis 5% or more of the Company&#8217;s stock. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. The Company discloses all related party transactions. All transactions are recorded at fair value of the goods or services exchanged. Property purchased from a related party is recorded at the cost to the related party and any payment to or on behalf of the related party in excess of the cost is reflected as a distribution to related party.</div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><table style="clear:both;clear:both;font: 10pt/normal Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; font-size-adjust: none; font-stretch: normal;" cellspacing="0" cellpadding="0"><tr style="vertical-align: top;"><td style="width: 0.5in; font-size: 10pt;;"><div>&#160;</div></td><td style="width: 0.25in; font-size: 10pt;;"><div><div style="CLEAR:both;font-weight:bold;display:inline;">h)</div></div></td><td style="text-align: justify; 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text-align: justify;"><div style="display:inline;font-size: 13.3333px; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">On July 19, 2016, the Company received a notice from Licensor purporting to effectively terminate the License Agreement for non-payment of required royalties, asserting, among other things, that as of June 30, 2016, Novas owed Licensor a pro rata amount of $</div>1,458,333<div style="display:inline;font-size: 13.3333px; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"> for the Licensed Plasma Pulse Technology for the United States and Mexico, of which $</div>1,000,000<div style="display:inline;font-size: 13.3333px; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"> was alleged to be in arrears. Novas has recently been contacted by Licensor with a request for settlement discussions; however, there can be no assurance that such discussions will occur or what the outcome of any such discussions will be. The Company and Novas believe that there is no legal basis for Licensor to terminate the License Agreement and intend to vigorously defend against any attempt by Licensor to enforce a termination of the License Agreement. Further, we believe that Licensor has failed to materially perform its obligations under the License Agreement, and that such failures on Licensor&#8217;s part may impact what, if any, payments are due under the License Agreement by Novas to Licensor.</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">&#160;<div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">On October 4, 2016, Novas Energy USA, Inc. (&#8220;Novas USA&#8221;), a wholly owned subsidiary of the Company, delivered a notice to Technovita Technologies USA, Inc. (&#8220;Technovita&#8221;) electing to dissolve its joint venture with Technovita (the &#8220;Joint Venture&#8221;), effective November 1, 2016, pursuant to Section 11.1(b) of the Operating Agreement of Novas Energy North America, LLC (&#8220;NENA&#8221;), dated October 22, 2015 (the &#8220;Operating Agreement&#8221;), by and among Novas USA and Technovita.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">Pursuant to the Operating Agreement, Novas USA had entered into a sublicense agreement (the &#8220;Novas Sublicense Agreement&#8221;) with NENA and Novas Energy Group Limited for NENA to be the exclusive provider of Plasma Pulse Technology for treatment of vertical wells to third parties in the United States. The Sublicense Agreement was terminated upon termination of the Joint Venture.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; 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roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times 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style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">$</td><td width="11%" 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roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">(358,000)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr> </table></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; float: none; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: 400;"></div><div style="display:inline;font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; text-align: justify; font-style: normal; font-weight: 400;"><div style="display:inline;; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">&#160; &#160; &#160; &#160; &#160; &#160;&#160;</div></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: 400; margin-left: 0in; text-indent: 0in;list-style-position: inside;"><div style="display:inline;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: 400;"><div style="display:inline;; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">&#160; &#160; &#160; &#160; &#160; &#160; &#160;<div style="display:inline; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">&#160;</div></div>Amortization expense was $</div>0<div style="display:inline;font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; text-align: justify; font-style: normal; font-weight: 400;"> and $</div>52,500<div style="display:inline;font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; text-align: justify; font-style: normal; font-weight: 400;"> for the nine months ended September 30, 2017 and 2016, respectively.</div></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" 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line-height: normal; width: 100%;"><tr style="vertical-align: top;"><td style="width: 2.5%;;"><div><div style="CLEAR:both;font-weight:bold;display:inline;">10</div></div></td><td style="text-align: justify;;"><div><div style="CLEAR:both;font-weight:bold;display:inline;">NET LOSS PER SHARE</div></div></td></tr></table></div><div style="display:inline;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"></div><br/></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">Basic loss per share is based on the weighted-average number of common shares outstanding during each period. 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roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">380,950</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">4,380,950</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="59%" 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">6,339,498</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="59%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Series A-1 convertible preferred shares</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">31,375,000</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new 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roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">4,000,000</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">4,000,000</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="59%" 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style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">120,000,000</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="59%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">162,095,448</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">166,095,448</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr> </table></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; float: none; 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Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif ">Dilutive shares which could exist pursuant to the exercise of outstanding stock instruments and which were not included in the calculation because their affect would have been anti-dilutive are as follows</div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; 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rowspan="1">Three&#160;and&#160;Nine<br/>months<br/>ended<br/>September&#160;30,<br/>2017</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="15%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Three&#160;and&#160;Nine<br/>months<br/>ended<br/>September&#160;30,<br/>2016</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="59%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="59%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Stock options</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">380,950</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">4,380,950</td><td 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width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">31,375,000</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">31,375,000</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="59%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Series B convertible preferred shares</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">4,000,000</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">4,000,000</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="59%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Series C convertible preferred shares</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">120,000,000</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">120,000,000</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="59%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">162,095,448</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">166,095,448</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr> </table></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; float: none; 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10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.5in; text-align: justify;">On October 4, 2016, Novas Energy USA, Inc. 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style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Cash</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">61,661</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Prepaid expenses and other current assets</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">29,896</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">29,896</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#cceeff">Total current assets</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">111,037</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">111,037</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">Non-current assets</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Plant and equipment, net</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">6,480</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">6,480</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Total assets</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">117,517</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">117,517</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">Current liabilities</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Accounts payable</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">94,784</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">94,784</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Related party payables</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">932,478</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">932,478</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Accrued liabilities and other payables</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">115,971</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">115,971</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Total liabilities</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">1,143,233</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">1,143,233</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="65%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:26px;;background-color:#cceeff">Discontinued operations</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1,025,716</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1,025,716</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr> </table></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; 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roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Net revenue</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">48,560</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">13,017</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">139,950</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">Gross profit</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">35,543</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">56,378</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Sales and marketing expenses</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">848</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">11,729</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Professional fees</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">20,573</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">57,496</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Business development</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">145,319</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">230,268</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">802,460</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">General and administrative expenses</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">137,340</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">457,876</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Depreciation and amortization</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">477</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">1,280</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#cceeff">Total expense</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">389,506</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1,476,160</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">Loss from operations</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">(1,419,782)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="39%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><table cellpadding="0" cellspacing="0" style="clear:both;clear:both;font-family: &#34;Times New Roman&#34;, Times, serif; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; font-stretch: normal; font-size: 10pt; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; width: 100%; border: 0px solid;"><tr style="vertical-align: top; text-align: justify;"><td style="width: 0.75in;;"><div></div></td><td style="width: 0.25in; text-align: left;;"><div><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">i)</div></div></td><td style="text-align: justify;;"><div><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">Series B Convertible Preferred Stock</div></div></td></tr></table><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 1in; text-align: justify;"><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.01in; text-align: justify;">The Company has undeclared dividends on the Series B Preferred stock amounting to $154,553 as of September 30, 2017. If the dividends are paid in stock, the beneficial conversion feature of these undeclared dividends will be recorded upon the declaration of these dividends. The computation of loss per common share for the nine months ended September 30, 2017 takes into account these undeclared dividends.</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 1in; text-align: justify;">&#160;<div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><table cellpadding="0" cellspacing="0" style="clear:both;clear:both;font-family: &#34;Times New Roman&#34;, Times, serif; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; font-stretch: normal; font-size: 10pt; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; width: 100%; border: 0px solid;"><tr style="vertical-align: top; text-align: justify;"><td style="width: 0.75in;;"><div></div></td><td style="width: 0.25in; text-align: left;;"><div><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">ii)</div></div></td><td style="text-align: justify;;"><div><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">Series C Convertible Preferred Stock</div></div></td></tr></table><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 1in; text-align: justify;"><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.01in; text-align: justify;">The Company has undeclared dividends on the Series C Preferred stock amounting to $1,402,110 as of September 30, 2017. The computation of loss per common share for the nine months ended September 30, 2017 takes into account these undeclared dividends.</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px;">&#160;</div><table cellpadding="0" cellspacing="0" style="clear:both;clear:both;font-family: &#34;Times New Roman&#34;, Times, serif; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; font-stretch: normal; font-size: 10pt; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; width: 100%; border: 0px solid;"><tr style="vertical-align: top; text-align: justify;"><td style="width: 0.5in;;"><div></div></td><td style="width: 0.25in; text-align: left;;"><div><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">b)</div></div></td><td style="text-align: justify;;"><div><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">Stock Options</div></div></td></tr></table><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><table cellpadding="0" cellspacing="0" style="clear:both;clear:both;font-family: &#34;Times New Roman&#34;, Times, serif; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; font-stretch: normal; font-size: 10pt; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; width: 100%; border: 0px solid;"><tr style="vertical-align: top; text-align: justify;"><td style="width: 0.75in;;"><div></div></td><td style="width: 0.25in; text-align: left;;"><div><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">i)</div></div></td><td style="text-align: justify;;"><div><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">Plan options</div></div></td></tr></table><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 1in; text-align: justify;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 1in; text-align: justify;"><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.01in; text-align: justify;">At September 30, 2017 and December 31, 2016 there were 380,950 Plan options issued and outstanding, respectively, under the Stock Option Plan.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px; text-align: justify;"></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 1in; text-align: justify;">No options were issued during the nine months ended September 30, 2017 and the year ended December 31, 2016.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px; text-align: justify;">&#160;<div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><table cellpadding="0" cellspacing="0" style="clear:both;clear:both;font-family: &#34;Times New Roman&#34;, Times, serif; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; font-stretch: normal; font-size: 10pt; line-height: normal; margin-top: 0pt; margin-bottom: 0pt; width: 100%; border: 0px solid;"><tr style="vertical-align: top; text-align: justify;"><td style="width: 0.75in;;"><div></div></td><td style="width: 0.25in; text-align: left;;"><div><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">ii)</div></div></td><td style="text-align: justify;;"><div><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">Non-Plan Stock Options</div></div></td></tr></table><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 1in; text-align: justify;"><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.01in; text-align: justify;">On January 1, 2016, the Company granted, to its then Chief Executive Officer, non - plan options for 3,000,000 shares of common stock (that are not covered by the Company&#8217;s Stock Option Plan), with an exercise price of $0.08 per share and which options will expire thirty days after resignation. These options vested as to 1,000,000 on January 1, 2017, the first anniversary of the grant date; 1,000,000 was due to vest on the second anniversary of the grant date and a further 1,000,000 was due to vest on the third anniversary of the grant date.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.01in; text-align: justify;"><div style="display:inline;font-size: 13.3333px; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;"><br/></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.01in; text-align: justify;"><div style="display:inline;font-size: 13.3333px; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">On March 31, 2017, the Chief Executive Officer, Mr. Brian Boutte tendered his resignation and the remaining unvested options for 2,000,000 shares of common stock were cancelled. The 1,000,000 options which vested on January 1, 2017, were not exercised within 30 days of resignation by Mr. Boutte and have been forfeited.</div></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 1in; text-align: justify;"><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 1in; text-align: justify;"></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 1in; text-align: justify;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 1in; text-align: justify;">A summary of all of our option activity during the period January 1, 2016 to September 30, 2017 is as follows:</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 67.7pt;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: 400;"><table cellspacing="0" cellpadding="0" style="clear:both;clear:both;width: 85%; border-collapse: collapse; float: inherit; margin: 0in 0in 0in 1in; border: 0px solid;" align="left"> <tr style="height:12px;"> <td width="38%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">No.&#160;of&#160;shares</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="17%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Exercise&#160;price<br/>per&#160;share</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Weighted<br/>average&#160;exercise<br/>price</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="38%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="16%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="38%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">Outstanding January 1, 2016</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">0.18</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="38%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Granted - non-plan options</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="16%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="38%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Forfeited/cancelled</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">0.08</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="38%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Exercised</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" 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roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="38%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">Outstanding September 30, 2017</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" 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roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times 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roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">14,800</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new 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style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">285,150</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new 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style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">380,950</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">380,950</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">0.90</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr> </table></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: 400;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New 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solid;"><tr style="vertical-align: top;"><td style="width: 2.5%;;"><div>&#160;</div></td><td style="width: 1.25%;;"><div><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">c)</div></div></td><td style="text-align: justify;;"><div><div style="CLEAR:both;font-weight:bold;display:inline;width:100%;">Warrants</div></div></td></tr></table><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0px 0px 0px 0.75in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; 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FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; float: none; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: 400;"><table cellspacing="0" cellpadding="0" style="clear:both;clear:both;width: 88%; border-collapse: collapse; float: inherit; margin: 0in 0in 0in 0.75in; border: 0px solid;" align="left"> <tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="44%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="8" rowspan="1">Warrants&#160;outstanding</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="28%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="5" rowspan="1">Warrants&#160;exercisable</td><td width="1%" 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colspan="2" rowspan="1">No.&#160;of&#160;shares</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="15%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Weighted<br/>average<br/>remaining&#160;years</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Weighted<br/>average&#160;exercise<br/>price</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">No.&#160;of&#160;shares</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Weighted<br/>average<br/>exercise&#160;price</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">0.30</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" 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roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">375,000</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">0.25</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">1,751,667</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">1.74</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">1,751,667</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">0.15</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">525,500</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1.74</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">525,500</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">0.25</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">1,508,333</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">1.84</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">1,508,333</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">0.15</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">577,499</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1.85</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">577,499</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">0.25</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">968,166</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">1.85</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">968,166</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">0.25</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">633,333</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="14%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1.90</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">633,333</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times 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Document And Entity Information - shares
9 Months Ended
Sep. 30, 2017
Feb. 09, 2018
Document Information [Line Items]    
Document Type 10-Q  
Amendment Flag false  
Document Period End Date Sep. 30, 2017  
Document Fiscal Year Focus 2017  
Document Fiscal Period Focus Q3  
Entity Registrant Name PLEDGE PETROLEUM CORP  
Entity Central Index Key 0001434110  
Current Fiscal Year End Date --12-31  
Entity Filer Category Smaller Reporting Company  
Trading Symbol PROP  
Entity Common Stock, Shares Outstanding   268,558,931
XML 15 R2.htm IDEA: XBRL DOCUMENT v3.8.0.1
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)
Sep. 30, 2017
Dec. 31, 2016
Current Assets    
Cash $ 8,755,803 $ 9,170,286
Prepaid expenses 19,684 25,940
Total Current Assets 8,775,487 9,196,226
Non-Current Assets    
Plant and equipment, net 10,198 14,326
Deposits 530 6,968
Total Non-Current Assets 10,728 21,294
Total Assets 8,786,215 9,217,520
Current Liabilities    
Accounts payable 64,449 31,027
Accrued expenses and other payables 14,860 34,467
Net liabilities of discontinued operations 1,025,716 1,025,716
Notes payable 3,000 3,000
Total Current Liabilities 1,108,025 1,094,210
Stockholders' Equity    
Common stock, $0.001 par value; 500,000,000 shares authorized, 268,558,931 shares issued and outstanding. 268,559 268,559
Additional paid-in-capital 26,377,580 26,359,514
Accumulated deficit (18,975,627) (18,512,441)
Total Stockholders' Equity 7,678,190 8,123,310
Total Liabilities and Stockholders' Equity 8,786,215 9,217,520
Series A-1 Convertible Preferred stock [Member]    
Stockholders' Equity    
Preferred Stock Value 3,138 3,138
Series B Convertible Preferred Stock [Member]    
Stockholders' Equity    
Preferred Stock Value 40 40
Series C Convertible Preferred Stock [Member]    
Stockholders' Equity    
Preferred Stock Value $ 4,500 $ 4,500
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CONDENSED CONSOLIDATED BALANCE SHEETS [Parenthetical] - USD ($)
Sep. 30, 2017
Dec. 31, 2016
Common Stock, Par or Stated Value Per Share $ 0.001 $ 0.001
Common Stock, Shares Authorized 500,000,000 500,000,000
Common Stock, Shares, Issued 268,558,931 268,558,931
Common Stock, Shares, Outstanding 268,558,931 268,558,931
Series A-1 Convertible Preferred stock [Member]    
Preferred Stock, Par or Stated Value Per Share $ 0.01 $ 0.01
Preferred Stock Shares Designated 5,000,000 5,000,000
Preferred Stock, Shares Issued 3,137,500 3,137,500
Preferred Stock, Shares Outstanding 3,137,500 3,137,500
Preferred Stock, Liquidation Preference, Value $ 251,000 $ 251,000
Series B Convertible Preferred Stock [Member]    
Preferred Stock, Par or Stated Value Per Share $ 0.001 $ 0.001
Preferred Stock Shares Designated 500,000 500,000
Preferred Stock, Shares Issued 40,000 40,000
Preferred Stock, Shares Outstanding 40,000 40,000
Preferred Stock, Liquidation Preference, Value $ 480,000 $ 480,000
Series C Convertible Preferred Stock [Member]    
Preferred Stock, Par or Stated Value Per Share $ 0.001 $ 0.001
Preferred Stock Shares Designated 4,500,000 4,500,000
Preferred Stock, Shares Issued 4,500,000 4,500,000
Preferred Stock, Shares Outstanding 4,500,000 4,500,000
Preferred Stock, Liquidation Preference, Value $ 14,750,000 $ 14,750,000
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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Net Revenue $ 0 $ 0 $ 25,000 $ 0
Cost of Goods Sold 0 0 0 0
Gross Profit 0 0 25,000 0
Sales and Marketing 1,497 (196) 4,491 6,569
Professional fees 73,887 140,616 222,249 310,173
Business development 0 3,079 0 22,181
Consulting fees 6,800 43,986 34,236 287,086
General and administrative 53,076 258,952 223,558 894,807
Depreciation, amortization and impairment charges 1,263 66,271 4,128 134,553
Total Expense 136,523 512,708 488,662 1,655,369
Loss from Operations (136,523) (512,708) (463,662) (1,655,369)
Other income 0 4,059 0 203,296
Finance costs 432 0 476 0
Loss before Provision for Income Taxes (136,091) (508,649) (463,186) (1,452,073)
Provision for Income Taxes 0 0 0 0
Net Loss from continuing operations (136,091) (508,649) (463,186) (1,452,073)
Loss for discontinued operations, net of tax 0 (363,421)   (1,428,157)
Net loss attributable to non-controlling interest of discontinued operation 0 0 0 249,339
Loss from discontinued operations, net of non-controlling interest 0 (363,421) 0 (1,178,818)
Net Loss Attributable to Controlling Interest (136,091) (872,070) (463,186) (2,630,891)
Undeclared Series B and Series C Preferred stock dividends (157,786) (157,786) (468,214) (469,928)
Net loss available to common stock holders $ (293,877) $ (1,029,856) $ (931,400) $ (3,100,819)
Net Loss Per Share from continuing operations - Basic and Diluted $ 0 $ 0 $ 0 $ (0.01)
Net Loss Per Share from discontinued operations - Basic and Diluted 0 0 0 0
Net Loss Per Share - Basic and Diluted $ 0 $ 0 $ 0 $ (0.01)
Weighted Average Number of Shares Outstanding - Basic and Diluted 268,558,931 268,558,931 268,558,931 268,558,931
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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)
9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
CASH FLOWS FROM OPERATING ACTIVITIES:    
Net loss $ (463,186) $ (2,630,891)
Net loss from discontinued operations   1,428,157
Less: loss attributable to non-controlling interest 0 (249,339)
Net loss from continuing operations (463,186) (1,452,073)
Adjustment to reconcile net loss to net cash used in operating activities:    
Depreciation expense 4,128 82,053
Deposit forfeited 6,968 0
Amortization expense 0 52,500
Loss on scrapping of fixed assets 0 1,248
Equity based compensation charge 18,066 66,035
Gain on debt forgiven 0 (200,000)
Changes in Assets and Liabilities    
Accounts receivable 0 (3,400)
Prepaid expenses and other current assets 6,257 29,241
Accounts payable 33,629 (41,702)
Accrued liabilities (19,815) (31,109)
Cash Used in Operating Activities - continuing operations (413,953) (1,497,207)
Cash used in operating activities - discontinued operations 0 (470,842)
Net Cash Provided by (Used in) Operating Activities (413,953) (1,968,049)
CASH FLOWS FROM INVESTING ACTIVITIES:    
Purchase of property and equipment 0 (200,899)
Investment in deposit (530) (6,968)
Cash used in investing activities - continuing operations (530) (207,867)
Cash used in investing activities - discontinued operations 0 (4,782)
Net Cash Provided by (Used in) Investing Activities (530) (212,649)
NET INCREASE IN CASH (414,483) (2,180,698)
CASH AT BEGINNING OF PERIOD 9,170,286 11,700,143
CASH AT END OF PERIOD 8,755,803 9,519,445
CASH PAID FOR INTEREST AND TAXES:    
Cash paid for income taxes 0 0
Cash paid for interest $ 0 $ 48,130
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ACCOUNTING POLICIES AND ESTIMATES
9 Months Ended
Sep. 30, 2017
Accounting Policies [Abstract]  
Significant Accounting Policies [Text Block]
1
ACCOUNTING POLICIES AND ESTIMATES
 
a)
Basis of Presentation
 
The accompanying unaudited condensed financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X. Accordingly, these unaudited condensed financial statements do not include all of the information and disclosures required by U.S. GAAP for complete financial statements. In the opinion of management, the accompanying unaudited condensed financial statements include all adjustments (consisting only of normal recurring adjustments), which we consider necessary, for a fair presentation of those financial statements. The results of operations and cash flows for the three months and nine months ended September 30, 2017 may not necessarily be indicative of results that may be expected for any succeeding quarter or for the entire fiscal year. The information contained in this quarterly report on Form 10-Q should be read in conjunction with our audited financial statements included in our annual report on Form 10-K as of and for the year ended December 31, 2016 as filed with the Securities and Exchange Commission (the “SEC”).
 
Significant accounting policies are described in Note 2 to the consolidated financial statements included in Item 8 of our annual report on Form 10-K as of December 31, 2016.
 
The preparation of unaudited consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions, which are evaluated on an ongoing basis, that affect the amounts reported in the unaudited consolidated financial statements and accompanying notes. Management bases its estimates on historical experience and on various other assumptions that it believes are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the amounts of revenues and expenses that are not readily apparent from other sources. Actual results could differ from those estimates and judgments. In particular, significant estimates and judgments include those related to: the estimated useful lives for plant and equipment, the fair value of warrants and stock options granted for services or compensation, estimates of the probability and potential magnitude of contingent liabilities, derivative liabilities, the valuation allowance for deferred tax assets due to continuing operating losses, those related to revenue recognition and the allowance for doubtful accounts.
 
Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the unaudited consolidated financial statements, which management considered in formulating its estimate could change in the near-term due to one or more future confirming events. Accordingly, the actual results could differ significantly from our estimates.
 
All amounts referred to in the notes to the unaudited consolidated financial statements are in United States Dollars ($) unless stated otherwise.
 
 
b)
Principles of Consolidation
 
The unaudited consolidated financial statements include the financial statements of the Company and its subsidiaries in which it has a majority voting interest. All significant inter-company accounts and transactions have been eliminated in the unaudited consolidated financial statements. The entities included in these unaudited consolidated financial statements are as follows:
 
Pledge Petroleum Corp (formerly Propell Technologies Group, Inc.) – Parent Company
Novas Energy USA Inc. (wholly owned)
Novas Energy North America, LLC (60% owned) – Discontinued operation.
 
 
 
c)
Recent Accounting Pronouncements
 
In July 2017, the FASB issued Accounting Standards Update No. (“ASU’’) 2017-11, Earnings Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480) and Derivatives and Hedging (Topic 815). The amendments in this Update provide guidance about:
 
1.
Accounting for certain financial instruments with down round features
 
2.
Replacement of the indefinite deferral for mandatorily redeemable financial instruments of certain non-public entities and certain non-controlling interests
 
The amendments in Part I of this Update change the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. The amendments also clarify existing disclosure requirements for equity-classified instruments. As a result, a freestanding equity-linked financial instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. For freestanding equity classified financial instruments, the amendments require entities that present earnings per share (EPS) in accordance with Topic 260 to recognize the effect of the down round feature when it is triggered. That effect is treated as a dividend and as a reduction of income available to common shareholders in basic EPS. Convertible instruments with embedded conversion options that have down round features are now subject to the specialized guidance for contingent beneficial conversion features (in Subtopic 470-20, Debt—Debt with Conversion and Other Options), including related EPS guidance (in Topic 260).
 
The amendments in Part II of this Update recharacterize the indefinite deferral of certain provisions of Topic 480 that now are presented as pending content in the Codification, to a scope exception. Those amendments do not have an accounting effect.
 
The amendments in Part I of this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted for all entities, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. The amendments in Part 1 of this Update should be applied in either of the following ways: 1. Retrospectively to outstanding financial instruments with a down round feature by means of a cumulative-effect adjustment to the statement of financial position as of the beginning of the first fiscal year and interim period(s) in which the pending content that links to this paragraph is effective 2. Retrospectively to outstanding financial instruments with a down round feature for each prior reporting period presented in accordance with the guidance on accounting changes in paragraphs 250-10-45-5 through 45-10.
 
The amendments in Part II of this Update do not require any transition guidance because those amendments do not have an accounting effect.
 
The Company is currently evaluating the impact this ASU will have on its consolidated financial In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging, an amendment to Topic 815. The amendments in this Update better align an entity’s risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. To meet that objective, the amendments expand and refine hedge accounting for both nonfinancial and financial risk components 2 and align the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. The amendments in this Update require an entity to present the earnings effect of the hedging instrument in the same income statement line item in which the earnings effect of the hedged item is reported.
 
The amendments in this Update are effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early application is permitted in any interim period after issuance of the Update. All transition requirements and elections should be applied to hedging relationships existing (that is, hedging relationships in which the hedging instrument has not expired, been sold, terminated, or exercised or the entity has not removed the designation of the hedging relationship) on the date of adoption. The effect of adoption should be reflected as of the beginning of the fiscal year of adoption. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements.
 
In September 2017, the FASB issued ASU 2017-13, Revenue Recognition (Topic 605), Revenue from Contracts with Customers (Topic 606), Leases (Topic 840), and Leases (Topic 842). The amendments in this ASU deals with the transition and effective dates of implementing to ASU 2014-09, Revenue from contracts with customers, ASU 2016-08, Revenue from contracts with customers, principal versus agent considerations, ASU 2016-10, revenues from contacts with customers; identifying performance obligations and licensing, ASU 2016-12, revenues from contacts with customers, narrow scope improvements and practical expedients, 2016-20, technical corrections and improvements and ASU 2017-05, other income, gains and losses from the derecognition of non-financial assets.
 
The transition provisions require adoption of Topic 606 for annual reporting periods commencing after December 15, 2017 and the adoption of Topic 842 for annual reporting periods beginning after December 15, 2018 for public business entities, if the requirements of a public business entity as defined in ASU 2017-122 are not met, may adopt Topic 606 for annual reporting periods commencing after December 15, 2018 and for Topic 842 for annual reporting periods commencing after December 15, 2019. Early adoption is permitted of both Topics. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements.
 
Any new accounting standards, not disclosed above, that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the financial statements upon adoption.

 
d)
Use of Estimates
 
The preparation of unaudited consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions, which are evaluated on an ongoing basis, that affect the amounts reported in the unaudited consolidated financial statements and accompanying notes. Management bases its estimates on historical experience and on various other assumptions that it believes are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the amounts of revenues and expenses that are not readily apparent from other sources. Actual results could differ from those estimates and judgments. In particular, significant estimates and judgments include those related to: the estimated useful lives for plant and equipment, the fair value of warrants and stock options granted for services or compensation, estimates of the probability and potential magnitude of contingent liabilities, derivative liabilities, the valuation allowance for deferred tax assets due to continuing operating losses, those related to revenue recognition and the allowance for doubtful accounts.
 
Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the unaudited consolidated financial statements, which management considered in formulating its estimate could change in the near-term due to one or more future confirming events. Accordingly, the actual results could differ significantly from our estimates.
 
 
e)
Contingencies
 
Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company’s management assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment.
 
If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material would be disclosed. Loss contingencies considered to be remote by management are generally not disclosed unless they involve guarantees, in which case the guarantee would be disclosed.
  
 
f)
Cash and Cash Equivalents
 
The Company considers all highly liquid investments with original maturities of three months or less at the time of purchase to be cash equivalents. At September 30, 2017 and December 31, 2016, respectively, the Company had no cash equivalents.
 
The Company assesses credit risk associated with cash by periodically evaluating the credit quality of its primary financial institution. The balance at times may exceed federally insured limits. At September 30, 2017, the Company had cash balances of $8,755,803, which exceeded the federally insured limits by $8,450,408.
 
 
g)
Related parties
 
Parties are considered to be related to the Company if the parties that, directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company, or own in aggregate, on a fully diluted basis 5% or more of the Company’s stock. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. The Company discloses all related party transactions. All transactions are recorded at fair value of the goods or services exchanged. Property purchased from a related party is recorded at the cost to the related party and any payment to or on behalf of the related party in excess of the cost is reflected as a distribution to related party.

 
h)
Reclassification
 
Certain reclassifications have been made to the prior year financial statement numbers to conform to the current presentation of the financial stateme
n
ts.
XML 20 R7.htm IDEA: XBRL DOCUMENT v3.8.0.1
GOING CONCERN
9 Months Ended
Sep. 30, 2017
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Substantial Doubt about Going Concern [Text Block]
2
GOING CONCERN
 
The Company has cash balances of $8,755,803 as of September 30, 2017, which is sufficient to meet current expenses for at least the next twelve month period, however the Board of Directors are considering various options as to the future direction of the Company, including the possible sale of its technology and PPT assets. The Company formed a special committee to investigate a possible share buyback of the majority stockholder, Ervington Investments Limited, and/or a possible dissolution of the Company.
 
Due to uncertainties surrounding the Company’s ability to realize the full value of its assets, the Company cannot make any assurances regarding the amount available for distribution to its stockholders.
 
The Company has made certain projections relating to the amount of cash it expects to have to distribute to its stockholders upon dissolution of the Company. These projections generally relate to the amount of liabilities which must be satisfied before the Company is dissolved and the amount its preferred stockholders is expected to receive for their equity interest. The above projections are subject to multiple variables, including the timing of a dissolution affecting the amount of dividends payable and the amount of liabilities owed at the time of dissolution. Based upon current estimates, if the Company were to dissolve this quarter, no assurance can be given that common stockholders or subordinate preferred stockholders will receive any such distribution.
XML 21 R8.htm IDEA: XBRL DOCUMENT v3.8.0.1
DISCONTINUED OPERATIONS
9 Months Ended
Sep. 30, 2017
Discontinued Operations and Disposal Groups [Abstract]  
Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]
3
DISCONTINUED OPERATIONS
 
On October 4, 2016, Novas Energy USA, Inc. (“Novas USA”), a wholly owned subsidiary of the Company, delivered a notice to Technovita Technologies USA, Inc. (“Technovita”) electing to dissolve its joint venture with Technovita (the “Joint Venture”), effective November 1, 2016, pursuant to Section 11.1(b) of the Operating Agreement of Novas Energy North America, LLC (“NENA”), dated October 22, 2015 (the “Operating Agreement”), by and among Novas USA and Technovita.
 
The assets and liabilities of discontinued operations as of September 30, 2017 and December 31, 2016, respectively is as follows:
 
  September 30,
2017
 December 31,
2016
 
Current assets       
Cash $19,480 $19,480 
Accounts receivable, net  61,661  61,661 
Prepaid expenses and other current assets  29,896  29,896 
Total current assets  111,037  111,037 
Non-current assets       
Plant and equipment, net  6,480  6,480 
Total assets  117,517  117,517 
        
Current liabilities       
Accounts payable  94,784  94,784 
Related party payables  932,478  932,478 
Accrued liabilities and other payables  115,971  115,971 
Total liabilities  1,143,233  1,143,233 
Discontinued operations $1,025,716 $1,025,716 
 
Loss from discontinued operations is as follows:
 
  Three months
ended
September 30
2017
 Three months
ended
September 30,
2016
 Nine months
ended
September 30,
2017
 Nine months
ended
September 30,
2016
 
              
Net revenue $- $48,560 $- $196,328 
Cost of goods sold  -  13,017  -  139,950 
Gross profit  -  35,543  -  56,378 
              
Sales and marketing expenses  -  848  -  11,729 
Professional fees  -  20,573  -  57,496 
Business development  -  -  -  145,319 
Consulting fees  -  230,268  -  802,460 
General and administrative expenses  -  137,340  -  457,876 
Depreciation and amortization  -  477  -  1,280 
Total expense  -  389,506  -  1,476,160 
              
Loss from operations  -  (353,963)  -  (1,419,782) 
              
Loss on discontinuance of subsidiary  -  (9,377)  -  (9,377) 
Foreign currency (losses) gains  -  (81)  -  992 
Other income  -  -  -  10 
              
Loss from discontinued operations $- $(363,421) $- $1,428,157 
XML 22 R9.htm IDEA: XBRL DOCUMENT v3.8.0.1
PREPAID EXPENSES
9 Months Ended
Sep. 30, 2017
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]  
Other Assets Disclosure [Text Block]
4
PREPAID EXPENSES
 
Prepaid expenses consisted of the following:
 
  September 30,
2017
 December 31,
2016
 
        
Prepaid insurance $13,851 $22,607 
Prepaid professional fees  5,833  3,333 
  $19,684 $25,940 
XML 23 R10.htm IDEA: XBRL DOCUMENT v3.8.0.1
PLANT AND EQUIPMENT
9 Months Ended
Sep. 30, 2017
Property, Plant and Equipment [Abstract]  
Property, Plant and Equipment Disclosure [Text Block]
5
PLANT AND EQUIPMENT
 
Plant and Equipment consisted of the following:
 
  September 30,
2017
 December 31,
2016
 
  Cost Amortization
and Impairment
 Net book value Net book value 
              
Plasma pulse tool $945,423 $(945,423) $- $- 
Furniture and equipment  6,700  (2,122)  4,578  5,583 
Field equipment  19,627  (19,627)  -  341 
Computer equipment  11,130  (5,510)  5,620  8,402 
              
  $982,880 $(972,682) $10,198 $14,326 
 
Depreciation expense was $4,128 and $82,053 for the nine months ended September 30, 2017 and 2016, respectively.
XML 24 R11.htm IDEA: XBRL DOCUMENT v3.8.0.1
INTANGIBLES
9 Months Ended
Sep. 30, 2017
Goodwill and Intangible Assets Disclosure [Abstract]  
Intangible Assets Disclosure [Text Block]
6
INTANGIBLES
 
Licenses
 
Novas licenses the “Plasma-Pulse Technology” (“the Technology”) from Novas Energy Group Limited, the Licensor, pursuant to the terms of an exclusive perpetual royalty bearing license it entered into in January 2013, which was amended during March 2014.

On July 19, 2016, the Company received a notice from Licensor purporting to effectively terminate the License Agreement for non-payment of required royalties, asserting, among other things, that as of June 30, 2016, Novas owed Licensor a pro rata amount of $
1,458,333
for the Licensed Plasma Pulse Technology for the United States and Mexico, of which $
1,000,000
was alleged to be in arrears. Novas has recently been contacted by Licensor with a request for settlement discussions; however, there can be no assurance that such discussions will occur or what the outcome of any such discussions will be. The Company and Novas believe that there is no legal basis for Licensor to terminate the License Agreement and intend to vigorously defend against any attempt by Licensor to enforce a termination of the License Agreement. Further, we believe that Licensor has failed to materially perform its obligations under the License Agreement, and that such failures on Licensor’s part may impact what, if any, payments are due under the License Agreement by Novas to Licensor.
 
 
On October 4, 2016, Novas Energy USA, Inc. (“Novas USA”), a wholly owned subsidiary of the Company, delivered a notice to Technovita Technologies USA, Inc. (“Technovita”) electing to dissolve its joint venture with Technovita (the “Joint Venture”), effective November 1, 2016, pursuant to Section 11.1(b) of the Operating Agreement of Novas Energy North America, LLC (“NENA”), dated October 22, 2015 (the “Operating Agreement”), by and among Novas USA and Technovita.
 
Pursuant to the Operating Agreement, Novas USA had entered into a sublicense agreement (the “Novas Sublicense Agreement”) with NENA and Novas Energy Group Limited for NENA to be the exclusive provider of Plasma Pulse Technology for treatment of vertical wells to third parties in the United States. The Sublicense Agreement was terminated upon termination of the Joint Venture.
 
Intangibles consisted of the following:
 
  September 30,
2017
 December 31,
2016
 
  Cost Amortization
and Impairment
 Net book value Net book value 
              
License agreements $350,000 $(350,000) $- $- 
Website development  8,000  (8,000)  -  - 
              
  $358,000 $(358,000) $- $- 
            
             
 
Amortization expense was $
0
and $
52,500
for the nine months ended September 30, 2017 and 2016, respectively.
XML 25 R12.htm IDEA: XBRL DOCUMENT v3.8.0.1
ACCRUED LIABILITIES AND OTHER PAYABLES
9 Months Ended
Sep. 30, 2017
Accounts Payable and Accrued Liabilities [Abstract]  
Accounts Payable and Accrued Liabilities Disclosure [Text Block]
7
ACCRUED LIABILITIES AND OTHER PAYABLES
 
Accrued liabilities consisted of the following:
 
  September 30,
2017
 December 31,
2016
 
        
Royalties payable $14,653 $14,653 
Other  207  - 
Severance accrual  -  19,814 
  $14,860 $34,467 
 
The severance accrual relates to accrued severance costs due to the COO, whose employment with the Company was terminated on December 15, 2016 as part of a cost reduction exercise.
XML 26 R13.htm IDEA: XBRL DOCUMENT v3.8.0.1
STOCKHOLDERS' EQUITY
9 Months Ended
Sep. 30, 2017
Stockholders' Equity Note [Abstract]  
Stockholders' Equity Note Disclosure [Text Block]
8
STOCKHOLDERS’ EQUITY
 
a)
Preferred stock
 
i)
Series B Convertible Preferred Stock
 
The Company has undeclared dividends on the Series B Preferred stock amounting to $154,553 as of September 30, 2017. If the dividends are paid in stock, the beneficial conversion feature of these undeclared dividends will be recorded upon the declaration of these dividends. The computation of loss per common share for the nine months ended September 30, 2017 takes into account these undeclared dividends.
 
 
ii)
Series C Convertible Preferred Stock
 
The Company has undeclared dividends on the Series C Preferred stock amounting to $1,402,110 as of September 30, 2017. The computation of loss per common share for the nine months ended September 30, 2017 takes into account these undeclared dividends.
 
b)
Stock Options
 
i)
Plan options
 
At September 30, 2017 and December 31, 2016 there were 380,950 Plan options issued and outstanding, respectively, under the Stock Option Plan.
 
No options were issued during the nine months ended September 30, 2017 and the year ended December 31, 2016.
 
 
ii)
Non-Plan Stock Options
 
On January 1, 2016, the Company granted, to its then Chief Executive Officer, non - plan options for 3,000,000 shares of common stock (that are not covered by the Company’s Stock Option Plan), with an exercise price of $0.08 per share and which options will expire thirty days after resignation. These options vested as to 1,000,000 on January 1, 2017, the first anniversary of the grant date; 1,000,000 was due to vest on the second anniversary of the grant date and a further 1,000,000 was due to vest on the third anniversary of the grant date.

On March 31, 2017, the Chief Executive Officer, Mr. Brian Boutte tendered his resignation and the remaining unvested options for 2,000,000 shares of common stock were cancelled. The 1,000,000 options which vested on January 1, 2017, were not exercised within 30 days of resignation by Mr. Boutte and have been forfeited.
 
A summary of all of our option activity during the period January 1, 2016 to September 30, 2017 is as follows:
 
  No. of shares Exercise price
per share
 Weighted
average exercise
price
 
           
Outstanding January 1, 2016  380,950  $0.08 to $13.50 $0.18 
Granted  4,000,000  $0.08 to $0.09  0.09 
Forfeited/cancelled  (1,000,000)  $0.08  0.08 
Exercised  -  -  - 
Outstanding December 31, 2016  3,380,950  $0.09 to $13.50 $0.18 
Granted - non-plan options  -  -  - 
Forfeited/cancelled  (3,000,000)  $0.08  0.08 
Exercised  -  -  - 
Outstanding September 30, 2017  380,950  $0.51 to $13.50 $0.90 
 
Stock options outstanding as of September 30, 2017 and December 31, 2016 as disclosed in the above table, have an intrinsic value of $0 and $0, respectively.
 
The options outstanding and exercisable at September 30, 2017 are as follows:
 
   Options outstanding Options exercisable 
Exercise price No. of shares Weighted
average
remaining years
 Weighted
average exercise
price
 No. of shares Weighted
average exercise
price
 
                  
$13.50  3,480  1.71     3,480    
$12.50  2,000  3.03     2,000    
$8.50  500  3.75     500    
$5.00  14,800  4.04     14,800    
$0.65  36,924  5.50     36,924    
$0.63  38,096  0.75     38,096    
$0.51  285,150  2.54     285,150    
                  
    380,950  2.70  0.90  380,950  0.90 
 
The Company has recorded an expense of $18,066 and $66,035 for the nine months ended September 30, 2017 and 2016, respectively relating to options issued.
 
 
c)
Warrants
 
The warrants outstanding and exercisable at September 30, 2017 are as follows:
 
   Warrants outstanding Warrants exercisable 
Exercise price No. of shares Weighted
average
remaining years
 Weighted
average exercise
price
 No. of shares Weighted
average
exercise price
 
                  
$0.30  375,000  1.08     375,000    
$0.25  1,751,667  1.74     1,751,667    
$0.15  525,500  1.74     525,500    
$0.25  1,508,333  1.84     1,508,333    
$0.15  577,499  1.85     577,499    
$0.25  968,166  1.85     968,166    
$0.25  633,333  1.90     633,333    
                  
    6,339,498  1.77  0.24  6,339,498  0.24 
 
The warrants outstanding have an intrinsic value of $0 and $0 as of September 30, 2017 and December 31, 2016, respectively.
XML 27 R14.htm IDEA: XBRL DOCUMENT v3.8.0.1
OTHER INCOME
9 Months Ended
Sep. 30, 2017
Other Income and Expenses [Abstract]  
Other Income and Other Expense Disclosure [Text Block]
9
OTHER INCOME
 
  Three
months
ended 30
September 2017
 Three
months
ended 30
September 2016
 Nine months
ended
September 30,
2017
 Nine months
ended
September 30,
2016
 
              
Other income $- $4,059 $- $203,296 
 
Other income in the prior period includes the forgiveness of the $
200,000
license fee due to Novas BVI during the prior period.
XML 28 R15.htm IDEA: XBRL DOCUMENT v3.8.0.1
NET LOSS PER SHARE
9 Months Ended
Sep. 30, 2017
Earnings Per Share [Abstract]  
Earnings Per Share [Text Block]
10
NET LOSS PER SHARE

Basic loss per share is based on the weighted-average number of common shares outstanding during each period. Diluted loss per share is based on basic shares as determined above plus common stock equivalents, including convertible preferred shares and convertible notes as well as the incremental shares that would be issued upon the assumed exercise of in-the-money stock options using the treasury stock method. The computation of diluted net loss per share does not assume the issuance of common shares that have an anti-dilutive effect on net loss per share. For the nine months ended September 30, 2017 and 2016, all stock options, warrants and convertible preferred stock were excluded from the computation of diluted net loss per share.
 
Dilutive shares which could exist pursuant to the exercise of outstanding stock instruments and which were not included in the calculation because their affect would have been anti-dilutive are as follows:
 
  Three and Nine
months
ended
September 30,
2017
 Three and Nine
months
ended
September 30,
2016
 
        
Stock options  380,950  4,380,950 
Warrants to purchase shares of common stock  6,339,498  6,339,498 
Series A-1 convertible preferred shares  31,375,000  31,375,000 
Series B convertible preferred shares  4,000,000  4,000,000 
Series C convertible preferred shares  120,000,000  120,000,000 
   162,095,448  166,095,448 
XML 29 R16.htm IDEA: XBRL DOCUMENT v3.8.0.1
RELATED PARTY TRANSACTIONS
9 Months Ended
Sep. 30, 2017
Related Party Transactions [Abstract]  
Related Party Transactions Disclosure [Text Block]
11
RELATED PARTY TRANSACTIONS
 
On January 1, 2016, the “Company entered into a three-year Employment Agreement with C. Brian Boutte (the “Boutte Employment Agreement”) to serve as the Company’s Chief Executive Officer. Mr. Boutte was to also serve as the Company’s interim Chief Financial Officer. Under the Boutte Employment Agreement, for his service as the Chief Executive Officer of the Company, Mr. Boutte was to receive an annual base salary of $265,000, a sign on bonus of $60,000 and an annual performance bonus of up to 55% of his base salary, such bonus payable in cash or equity upon attainment of certain performance indicators established by the Company’s Board of Directors and Mr. Boutte. In connection with the entry into the Boutte Employment Agreement, Mr. Boutte was granted an option award exercisable for 3,000,000 shares of the Company’s common stock, which will vest as to 1,000,000 shares on each of the one, two and three-year anniversary of the commencement of his employment with the Company. The Boutte Employment Agreement was amended on December 31, 2016 to provide for a term of six months ending June 30, 2017, a reduced annual base salary of $165,000 and a provision for immediate vesting of the options upon a Change of Control (as defined in the amendment). In the event that Mr. Boutte’s employment was terminated Without Cause (as defined in the Boutte Employment Agreement), by Mr. Boutte for Good Reason (as defined below), Disability (as defined in the Boutte Employment Agreement), upon his death or a change in control, Mr. Boutte would be entitled to receive a severance payment equal to $65,000. Upon a change in control, Mr. Boutte’s options would immediately vest. The Boutte Employment Agreement also included customary confidentiality obligations and inventions assignments by Mr. Boutte as well as a non- compete and non-solicitation provision. If his employment was terminated for Cause (as defined below) or by him Without Good Reason (as defined in the Boutte Employment Agreement), Mr. Boutte was entitled to receive his annual base salary through the date of termination and any bonus earned but unpaid. For purposes of the Boutte Employment Agreement, “Good Reason” is defined as (i) any material and substantial breach of the Boutte Employment Agreement by the Company; (ii) a Change in Control (as defined in the Boutte Employment Agreement) occurs and Mr. Boutte’s employment is terminated; (iii) a reduction in Mr. Boutte’s Annual Base Salary as in effect at the time in question, or any other failure by the Company to comply with the compensation terms of the Boutte Employment Agreement; or (iv) the Boutte Employment Agreement is not assumed by a successor to the Company. For purpose of the Boutte Employment Agreement, “Cause” is defined as (i) acts of embezzlement or misappropriation of funds or fraud; (ii) conviction of a felony or other crime involving moral turpitude, dishonesty or theft; (iii) a material violation by Mr. Boutte of any provision of the Boutte Employment Agreement, including willful failure to perform assigned tasks, willful and unauthorized disclosure of Company material confidential information; (iv) being under the influence of drugs (other than prescription medicine or other medically related drugs to the extent that they are taken in accordance with their directions) during the performance of Mr. Boutte’s duties and that performance of his duties is affected; (v) engaging in behavior that would constitute grounds for liability for harassment (as proscribed by the U.S. Equal Employment Opportunity Commission Guidelines or any other applicable state or local regulatory body) or other egregious conduct that violates laws governing the workplace; or (vi) willful failure to perform his assigned tasks, where such failure is attributable to the fault of Mr. Boutte, gross insubordination or dereliction of fiduciary obligations which, to the extent it is curable by Mr. Boutte, is not cured by Mr. Boutte within thirty (30) days of receiving written notice of such violation by the Company.
 
Mr. Boutte tendered his resignation to the Board of Directors on March 31, 2017.
XML 30 R17.htm IDEA: XBRL DOCUMENT v3.8.0.1
COMMITMENTS AND CONTINGENCIES
9 Months Ended
Sep. 30, 2017
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies Disclosure [Text Block]
12
COMMITMENTS AND CONTINGENCIES
 
The C
ompany disposed of its Crystal Magic, Inc. subsidiary effective December 31, 2013. In terms of the sale agreement entered into by the Company, the purchaser has been indemnified against all liabilities whether contingent or otherwise, claimed by third parties, this includes claims by creditors of the Company amounting to $
372,090
and claims against long-term liabilities of $
848,916
. Management does not consider it likely that these claims will materialize and accordingly no provision has been made for these contingent liabilities.

The Company entered into a lease agreement for approximately
3,733
square feet of office and warehouse space in Houston, the term of the lease was for
39
months commencing on
March 1, 2016
and terminating on
May 31, 2019
. The lease provided for the first month to be rent free, the fourteenth month to be rent free and the twenty-seventh month to be rent free. Monthly rentals, including estimated operating costs, for the first 12 months, excluding the free rental month amounted to approximately $
3,410
per month, escalating at a rate of
1.7
% per annum, after excluding the free rental months. This lease agreement was amended, and the lease terminated with effect from May 31, 2017 with a final payment of $
2,000
and the forfeiture of the security deposit of $
6,968
.

The Company entered into an Office Service Agreement on May 16, 2017 whereby it has the license to use an office in a business center, together with all telecommunication services and access to conference rooms, kitchens and all utilities, the agreement is for a period of six months commencing on June 1, 2017 and terminating on
November 30, 2017. The Company pays a monthly amount of $530 in terms of the Office Service Agreement.
 
In terms of the license agreement commitments disclosed in note 6 above, the minimum commitments due under the amended license agreement entered into on January 30, 2013, for the next five years, are summarized as follows:
 
  Amount 
     
2017 $500,000 
2018  500,000 
2019  500,000 
2020  500,000 
2021  500,000 
Total $2,500,000 
XML 31 R18.htm IDEA: XBRL DOCUMENT v3.8.0.1
SUBSEQUENT EVENTS
9 Months Ended
Sep. 30, 2017
Subsequent Events [Abstract]  
Subsequent Events [Text Block]
13
SUBSEQUENT EVENTS
 
The Company has entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”) with an affiliate (the “Purchaser”) of Ervington Investment Limited (“Ervington”), the current holder of a majority of the Company’s outstanding voting securities, pursuant to which the Company has agreed to sell to the Purchaser substantially all of its assets, including all pertinent intellectual property rights, comprising its business of implementing its plasma pulse technology, for $650,000 (the “Asset Sale”).  The Asset Purchase Agreement provides, among other things, that the Asset Sale is conditioned on its approval by holders of a majority of the Company’s voting securities, exclusive of the securities held by Ervington (a “majority of the minority”).
 
The Company has also entered into an agreement with Ervington (the “Share Repurchase Agreement”) to repurchase all of its outstanding securities held by Ervington for $8,500,000 (the “Share Repurchase”), which repurchase will occur at the same time as the Asset Sale.  The repurchase will constitute a change of control and upon consummation of the repurchase, Ivan Persiyanov, will resign from all positions he holds as an officer and director of the Company and its subsidiaries. After the completion of the Asset Sale, the Company expects to cease all activities related to its existing business while evaluating other business opportunities, which include potentially acquiring an oilfield services business, of which two of the Company’s current directors (Messrs. Huemoeller and Zotos) own a minority equity interest. The Company has not entered into an agreement with any potential acquisition candidate and has only been in the early stages of discussion.
 
The purchase price for the shares being repurchased and assets being sold together with documents necessary to effect the Asset Sale pursuant to the Asset Purchase Agreement and the Share Repurchase pursuant to the Share Repurchase Agreement, including, but not limited to, a bill of sale for the assets being sold, an assignment of intellectual property rights, stock certificates and stock powers for the shares to be repurchased from Ervington, and the resignation of Ivan Persiyanov, have been placed in escrow pending the approval of the Asset Sale by a majority of the minority and will be released at the subsequent closing of the transactions contemplated by the Asset Purchase Agreement and Share Repurchase Agreement.
 
Other than disclosed above, in accordance with ASC 855-10, the Company has analyzed its operations subsequent to September 30, 2017 to the date these financial statements were issued, and has determined that it does not have any material subsequent events to disclose in these financial statements.
XML 32 R19.htm IDEA: XBRL DOCUMENT v3.8.0.1
ACCOUNTING POLICIES AND ESTIMATES (Policies)
9 Months Ended
Sep. 30, 2017
Accounting Policies [Abstract]  
Basis of Accounting, Policy [Policy Text Block]
a)
Basis of Presentation
 
The accompanying unaudited condensed financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X. Accordingly, these unaudited condensed financial statements do not include all of the information and disclosures required by U.S. GAAP for complete financial statements. In the opinion of management, the accompanying unaudited condensed financial statements include all adjustments (consisting only of normal recurring adjustments), which we consider necessary, for a fair presentation of those financial statements. The results of operations and cash flows for the three months and nine months ended September 30, 2017 may not necessarily be indicative of results that may be expected for any succeeding quarter or for the entire fiscal year. The information contained in this quarterly report on Form 10-Q should be read in conjunction with our audited financial statements included in our annual report on Form 10-K as of and for the year ended December 31, 2016 as filed with the Securities and Exchange Commission (the “SEC”).
 
Significant accounting policies are described in Note 2 to the consolidated financial statements included in Item 8 of our annual report on Form 10-K as of December 31, 2016.
 
The preparation of unaudited consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions, which are evaluated on an ongoing basis, that affect the amounts reported in the unaudited consolidated financial statements and accompanying notes. Management bases its estimates on historical experience and on various other assumptions that it believes are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the amounts of revenues and expenses that are not readily apparent from other sources. Actual results could differ from those estimates and judgments. In particular, significant estimates and judgments include those related to: the estimated useful lives for plant and equipment, the fair value of warrants and stock options granted for services or compensation, estimates of the probability and potential magnitude of contingent liabilities, derivative liabilities, the valuation allowance for deferred tax assets due to continuing operating losses, those related to revenue recognition and the allowance for doubtful accounts.
 
Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the unaudited consolidated financial statements, which management considered in formulating its estimate could change in the near-term due to one or more future confirming events. Accordingly, the actual results could differ significantly from our estimates.
 
All amounts referred to in the notes to the unaudited consolidated financial statements are in United States Dollars ($) unless stated otherwise.
Consolidation, Policy [Policy Text Block]
 
b)
Principles of Consolidation
 
The unaudited consolidated financial statements include the financial statements of the Company and its subsidiaries in which it has a majority voting interest. All significant inter-company accounts and transactions have been eliminated in the unaudited consolidated financial statements. The entities included in these unaudited consolidated financial statements are as follows:
 
Pledge Petroleum Corp (formerly Propell Technologies Group, Inc.) – Parent Company
Novas Energy USA Inc. (wholly owned)
Novas Energy North America, LLC (60% owned) – Discontinued operation.
New Accounting Pronouncements, Policy [Policy Text Block]
 
c)
Recent Accounting Pronouncements
 
In July 2017, the FASB issued Accounting Standards Update No. (“ASU’’) 2017-11, Earnings Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480) and Derivatives and Hedging (Topic 815). The amendments in this Update provide guidance about:
 
1.
Accounting for certain financial instruments with down round features
 
2.
Replacement of the indefinite deferral for mandatorily redeemable financial instruments of certain non-public entities and certain non-controlling interests
 
The amendments in Part I of this Update change the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. The amendments also clarify existing disclosure requirements for equity-classified instruments. As a result, a freestanding equity-linked financial instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. For freestanding equity classified financial instruments, the amendments require entities that present earnings per share (EPS) in accordance with Topic 260 to recognize the effect of the down round feature when it is triggered. That effect is treated as a dividend and as a reduction of income available to common shareholders in basic EPS. Convertible instruments with embedded conversion options that have down round features are now subject to the specialized guidance for contingent beneficial conversion features (in Subtopic 470-20, Debt—Debt with Conversion and Other Options), including related EPS guidance (in Topic 260).
 
The amendments in Part II of this Update recharacterize the indefinite deferral of certain provisions of Topic 480 that now are presented as pending content in the Codification, to a scope exception. Those amendments do not have an accounting effect.
 
The amendments in Part I of this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted for all entities, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. The amendments in Part 1 of this Update should be applied in either of the following ways: 1. Retrospectively to outstanding financial instruments with a down round feature by means of a cumulative-effect adjustment to the statement of financial position as of the beginning of the first fiscal year and interim period(s) in which the pending content that links to this paragraph is effective 2. Retrospectively to outstanding financial instruments with a down round feature for each prior reporting period presented in accordance with the guidance on accounting changes in paragraphs 250-10-45-5 through 45-10.
 
The amendments in Part II of this Update do not require any transition guidance because those amendments do not have an accounting effect.
 
The Company is currently evaluating the impact this ASU will have on its consolidated financial In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging, an amendment to Topic 815. The amendments in this Update better align an entity’s risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. To meet that objective, the amendments expand and refine hedge accounting for both nonfinancial and financial risk components 2 and align the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. The amendments in this Update require an entity to present the earnings effect of the hedging instrument in the same income statement line item in which the earnings effect of the hedged item is reported.
 
The amendments in this Update are effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early application is permitted in any interim period after issuance of the Update. All transition requirements and elections should be applied to hedging relationships existing (that is, hedging relationships in which the hedging instrument has not expired, been sold, terminated, or exercised or the entity has not removed the designation of the hedging relationship) on the date of adoption. The effect of adoption should be reflected as of the beginning of the fiscal year of adoption. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements.
 
In September 2017, the FASB issued ASU 2017-13, Revenue Recognition (Topic 605), Revenue from Contracts with Customers (Topic 606), Leases (Topic 840), and Leases (Topic 842). The amendments in this ASU deals with the transition and effective dates of implementing to ASU 2014-09, Revenue from contracts with customers, ASU 2016-08, Revenue from contracts with customers, principal versus agent considerations, ASU 2016-10, revenues from contacts with customers; identifying performance obligations and licensing, ASU 2016-12, revenues from contacts with customers, narrow scope improvements and practical expedients, 2016-20, technical corrections and improvements and ASU 2017-05, other income, gains and losses from the derecognition of non-financial assets.
 
The transition provisions require adoption of Topic 606 for annual reporting periods commencing after December 15, 2017 and the adoption of Topic 842 for annual reporting periods beginning after December 15, 2018 for public business entities, if the requirements of a public business entity as defined in ASU 2017-122 are not met, may adopt Topic 606 for annual reporting periods commencing after December 15, 2018 and for Topic 842 for annual reporting periods commencing after December 15, 2019. Early adoption is permitted of both Topics. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements.
 
Any new accounting standards, not disclosed above, that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the financial statements upon adoption.
Use of Estimates, Policy [Policy Text Block]
 
d)
Use of Estimates
 
The preparation of unaudited consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions, which are evaluated on an ongoing basis, that affect the amounts reported in the unaudited consolidated financial statements and accompanying notes. Management bases its estimates on historical experience and on various other assumptions that it believes are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the amounts of revenues and expenses that are not readily apparent from other sources. Actual results could differ from those estimates and judgments. In particular, significant estimates and judgments include those related to: the estimated useful lives for plant and equipment, the fair value of warrants and stock options granted for services or compensation, estimates of the probability and potential magnitude of contingent liabilities, derivative liabilities, the valuation allowance for deferred tax assets due to continuing operating losses, those related to revenue recognition and the allowance for doubtful accounts.
 
Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the unaudited consolidated financial statements, which management considered in formulating its estimate could change in the near-term due to one or more future confirming events. Accordingly, the actual results could differ significantly from our estimates.
Commitments and Contingencies, Policy [Policy Text Block]
 
e)
Contingencies
 
Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company’s management assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment.
 
If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material would be disclosed. Loss contingencies considered to be remote by management are generally not disclosed unless they involve guarantees, in which case the guarantee would be disclosed.
Cash and Cash Equivalents, Policy [Policy Text Block]
 
f)
Cash and Cash Equivalents
 
The Company considers all highly liquid investments with original maturities of three months or less at the time of purchase to be cash equivalents. At September 30, 2017 and December 31, 2016, respectively, the Company had no cash equivalents.
 
The Company assesses credit risk associated with cash by periodically evaluating the credit quality of its primary financial institution. The balance at times may exceed federally insured limits. At September 30, 2017, the Company had cash balances of $8,755,803, which exceeded the federally insured limits by $8,450,408.
Related Party Transactions Policy [Policy Text Block]
 
g)
Related parties
 
Parties are considered to be related to the Company if the parties that, directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company, or own in aggregate, on a fully diluted basis 5% or more of the Company’s stock. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. The Company discloses all related party transactions. All transactions are recorded at fair value of the goods or services exchanged. Property purchased from a related party is recorded at the cost to the related party and any payment to or on behalf of the related party in excess of the cost is reflected as a distribution to related party.
Reclassification, Policy [Policy Text Block]
 
h)
Reclassification
 
Certain reclassifications have been made to the prior year financial statement numbers to conform to the current presentation of the financial stateme
n
ts.
XML 33 R20.htm IDEA: XBRL DOCUMENT v3.8.0.1
DISCONTINUED OPERATIONS (Tables)
9 Months Ended
Sep. 30, 2017
Discontinued Operations and Disposal Groups [Abstract]  
Disposal Groups, Including Discontinued Operations [Table Text Block]
The assets and liabilities of discontinued operations as of September 30, 2017 and December 31, 2016, respectively is as follows:
 
  September 30,
2017
 December 31,
2016
 
Current assets       
Cash $19,480 $19,480 
Accounts receivable, net  61,661  61,661 
Prepaid expenses and other current assets  29,896  29,896 
Total current assets  111,037  111,037 
Non-current assets       
Plant and equipment, net  6,480  6,480 
Total assets  117,517  117,517 
        
Current liabilities       
Accounts payable  94,784  94,784 
Related party payables  932,478  932,478 
Accrued liabilities and other payables  115,971  115,971 
Total liabilities  1,143,233  1,143,233 
Discontinued operations $1,025,716 $1,025,716 
 
Loss from discontinued operations is as follows:
 
  Three months
ended
September 30
2017
 Three months
ended
September 30,
2016
 Nine months
ended
September 30,
2017
 Nine months
ended
September 30,
2016
 
              
Net revenue $- $48,560 $- $196,328 
Cost of goods sold  -  13,017  -  139,950 
Gross profit  -  35,543  -  56,378 
              
Sales and marketing expenses  -  848  -  11,729 
Professional fees  -  20,573  -  57,496 
Business development  -  -  -  145,319 
Consulting fees  -  230,268  -  802,460 
General and administrative expenses  -  137,340  -  457,876 
Depreciation and amortization  -  477  -  1,280 
Total expense  -  389,506  -  1,476,160 
              
Loss from operations  -  (353,963)  -  (1,419,782) 
              
Loss on discontinuance of subsidiary  -  (9,377)  -  (9,377) 
Foreign currency (losses) gains  -  (81)  -  992 
Other income  -  -  -  10 
              
Loss from discontinued operations $- $(363,421) $- $1,428,157 
XML 34 R21.htm IDEA: XBRL DOCUMENT v3.8.0.1
PREPAID EXPENSES (Tables)
9 Months Ended
Sep. 30, 2017
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]  
Schedule of Other Assets [Table Text Block]
Prepaid expenses consisted of the following:
 
  September 30,
2017
 December 31,
2016
 
        
Prepaid insurance $13,851 $22,607 
Prepaid professional fees  5,833  3,333 
  $19,684 $25,940 
XML 35 R22.htm IDEA: XBRL DOCUMENT v3.8.0.1
PLANT AND EQUIPMENT (Tables)
9 Months Ended
Sep. 30, 2017
Property, Plant and Equipment [Abstract]  
Property, Plant and Equipment [Table Text Block]
Plant and Equipment consisted of the following:
 
  September 30,
2017
 December 31,
2016
 
  Cost Amortization
and Impairment
 Net book value Net book value 
              
Plasma pulse tool $945,423 $(945,423) $- $- 
Furniture and equipment  6,700  (2,122)  4,578  5,583 
Field equipment  19,627  (19,627)  -  341 
Computer equipment  11,130  (5,510)  5,620  8,402 
              
  $982,880 $(972,682) $10,198 $14,326 
XML 36 R23.htm IDEA: XBRL DOCUMENT v3.8.0.1
INTANGIBLES (Tables)
9 Months Ended
Sep. 30, 2017
Goodwill and Intangible Assets Disclosure [Abstract]  
Present Value of Future Insurance Profits [Table Text Block]
Intangibles consisted of the following:
 
  September 30,
2017
 December 31,
2016
 
  Cost Amortization
and Impairment
 Net book value Net book value 
              
License agreements $350,000 $(350,000) $- $- 
Website development  8,000  (8,000)  -  - 
              
  $358,000 $(358,000) $- $- 
XML 37 R24.htm IDEA: XBRL DOCUMENT v3.8.0.1
ACCRUED LIABILITIES AND OTHER PAYABLES (Tables)
9 Months Ended
Sep. 30, 2017
Accounts Payable and Accrued Liabilities [Abstract]  
Schedule of Accounts Payable and Accrued Liabilities [Table Text Block]
Accrued liabilities consisted of the following:
 
  September 30,
2017
 December 31,
2016
 
        
Royalties payable $14,653 $14,653 
Other  207  - 
Severance accrual  -  19,814 
  $14,860 $34,467 
XML 38 R25.htm IDEA: XBRL DOCUMENT v3.8.0.1
STOCKHOLDERS' EQUITY (Tables)
9 Months Ended
Sep. 30, 2017
Stockholders' Equity Note [Abstract]  
Schedule of Share-based Compensation, Stock Options, Activity [Table Text Block]
A summary of all of our option activity during the period January 1, 2016 to September 30, 2017 is as follows:
 
  No. of shares Exercise price
per share
 Weighted
average exercise
price
 
           
Outstanding January 1, 2016  380,950  $0.08 to $13.50 $0.18 
Granted  4,000,000  $0.08 to $0.09  0.09 
Forfeited/cancelled  (1,000,000)  $0.08  0.08 
Exercised  -  -  - 
Outstanding December 31, 2016  3,380,950  $0.09 to $13.50 $0.18 
Granted - non-plan options  -  -  - 
Forfeited/cancelled  (3,000,000)  $0.08  0.08 
Exercised  -  -  - 
Outstanding September 30, 2017  380,950  $0.51 to $13.50 $0.90 
Restricted Stock Outstanding And Exercisable [Table Text Block]
The options outstanding and exercisable at September 30, 2017 are as follows:
 
   Options outstanding Options exercisable 
Exercise price No. of shares Weighted
average
remaining years
 Weighted
average exercise
price
 No. of shares Weighted
average exercise
price
 
                  
$13.50  3,480  1.71     3,480    
$12.50  2,000  3.03     2,000    
$8.50  500  3.75     500    
$5.00  14,800  4.04     14,800    
$0.65  36,924  5.50     36,924    
$0.63  38,096  0.75     38,096    
$0.51  285,150  2.54     285,150    
                  
    380,950  2.70  0.90  380,950  0.90 
Schedule of Stockholders' Equity Note, Warrants or Rights [Table Text Block]
The warrants outstanding and exercisable at September 30, 2017 are as follows:
 
   Warrants outstanding Warrants exercisable 
Exercise price No. of shares Weighted
average
remaining years
 Weighted
average exercise
price
 No. of shares Weighted
average
exercise price
 
                  
$0.30  375,000  1.08     375,000    
$0.25  1,751,667  1.74     1,751,667    
$0.15  525,500  1.74     525,500    
$0.25  1,508,333  1.84     1,508,333    
$0.15  577,499  1.85     577,499    
$0.25  968,166  1.85     968,166    
$0.25  633,333  1.90     633,333    
                  
    6,339,498  1.77  0.24  6,339,498  0.24 
XML 39 R26.htm IDEA: XBRL DOCUMENT v3.8.0.1
OTHER INCOME (Tables)
9 Months Ended
Sep. 30, 2017
Other Income and Expenses [Abstract]  
Schedule of Other Nonoperating Income (Expense) [Table Text Block]
  Three
months
ended 30
September 2017
 Three
months
ended 30
September 2016
 Nine months
ended
September 30,
2017
 Nine months
ended
September 30,
2016
 
              
Other income $- $4,059 $- $203,296 
XML 40 R27.htm IDEA: XBRL DOCUMENT v3.8.0.1
NET LOSS PER SHARE (Tables)
9 Months Ended
Sep. 30, 2017
Earnings Per Share [Abstract]  
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]
Dilutive shares which could exist pursuant to the exercise of outstanding stock instruments and which were not included in the calculation because their affect would have been anti-dilutive are as follows
 
  Three and Nine
months
ended
September 30,
2017
 Three and Nine
months
ended
September 30,
2016
 
        
Stock options  380,950  4,380,950 
Warrants to purchase shares of common stock  6,339,498  6,339,498 
Series A-1 convertible preferred shares  31,375,000  31,375,000 
Series B convertible preferred shares  4,000,000  4,000,000 
Series C convertible preferred shares  120,000,000  120,000,000 
   162,095,448  166,095,448 
XML 41 R28.htm IDEA: XBRL DOCUMENT v3.8.0.1
COMMITMENTS AND CONTINGENCIES (Tables)
9 Months Ended
Sep. 30, 2017
Commitments and Contingencies Disclosure [Abstract]  
Schedule of Future Minimum Lease Payments for Capital Leases [Table Text Block]
In terms of the license agreement commitments disclosed in note 6 above, the minimum commitments due under the amended license agreement entered into on January 30, 2013, for the next five years, are summarized as follows:
 
  Amount 
     
2017 $500,000 
2018  500,000 
2019  500,000 
2020  500,000 
2021  500,000 
Total $2,500,000 
XML 42 R29.htm IDEA: XBRL DOCUMENT v3.8.0.1
ACCOUNTING POLICIES AND ESTIMATES (Details Textual) - USD ($)
Sep. 30, 2017
Dec. 31, 2016
Sep. 30, 2016
Dec. 31, 2015
Accounting Policies and Estimates [Line Items]        
Cash and Cash Equivalents, at Carrying Value, Total $ 8,755,803 $ 9,170,286 $ 9,519,445 $ 11,700,143
Cash And Cash Equivalents At Carrying Value, Exceeding Federal Limits $ 8,450,408      
XML 43 R30.htm IDEA: XBRL DOCUMENT v3.8.0.1
GOING CONCERN (Details Textual) - USD ($)
Sep. 30, 2017
Dec. 31, 2016
Going Concern [Line Items]    
Cash $ 8,755,803 $ 9,170,286
XML 44 R31.htm IDEA: XBRL DOCUMENT v3.8.0.1
DISCONTINUED OPERATIONS (Details) - Technovita Technologies USA, Inc [Member] - USD ($)
Sep. 30, 2017
Dec. 31, 2016
Current assets    
Cash $ 19,480 $ 19,480
Accounts receivable, net 61,661 61,661
Prepaid expenses and other current assets 29,896 29,896
Total current assets 111,037 111,037
Non-current assets    
Plant and equipment, net 6,480 6,480
Total assets 117,517 117,517
Current liabilities    
Accounts payable 94,784 94,784
Related party payables 932,478 932,478
Accrued liabilities and other payables 115,971 115,971
Total liabilities 1,143,233 1,143,233
Discontinued operations $ 1,025,716 $ 1,025,716
XML 45 R32.htm IDEA: XBRL DOCUMENT v3.8.0.1
DISCONTINUED OPERATIONS (Details 1) - USD ($)
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]        
Loss for discontinued operations, net of tax $ 0 $ (363,421)   $ (1,428,157)
Technovita Technologies USA, Inc [Member]        
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]        
Net revenue 0 48,560 $ 0 196,328
Cost of goods sold 0 13,017 0 139,950
Gross profit 0 35,543 0 56,378
Sales and marketing expenses 0 848 0 11,729
Professional fees 0 20,573 0 57,496
Business development 0 0 0 145,319
Consulting fees 0 230,268 0 802,460
General and administrative expenses 0 137,340 0 457,876
Depreciation and amortization 0 477 0 1,280
Total expense 0 389,506 0 1,476,160
Loss from operations 0 (353,963) 0 (1,419,782)
Loss on discontinuance of subsidiary 0 (9,377) 0 (9,377)
Foreign currency (losses) gains 0 (81) 0 992
Other income 0 0 0 10
Loss for discontinued operations, net of tax $ 0 $ (363,421) $ 0 $ 1,428,157
XML 46 R33.htm IDEA: XBRL DOCUMENT v3.8.0.1
PREPAID EXPENSES (Details) - USD ($)
Sep. 30, 2017
Dec. 31, 2016
Prepaid Expense [Line Items]    
Prepaid insurance $ 13,851 $ 22,607
Prepaid professional fees 5,833 3,333
Prepaid Expense, Current, Total $ 19,684 $ 25,940
XML 47 R34.htm IDEA: XBRL DOCUMENT v3.8.0.1
PLANT AND EQUIPMENT (Details) - USD ($)
Sep. 30, 2017
Dec. 31, 2016
Property, Plant and Equipment [Line Items]    
Cost $ 982,880  
Amortization and Impairment (972,682)  
Net book value 10,198 $ 14,326
Plasma pulse tool [Member]    
Property, Plant and Equipment [Line Items]    
Cost 945,423  
Amortization and Impairment (945,423)  
Net book value 0 0
Furniture and equipment [Member]    
Property, Plant and Equipment [Line Items]    
Cost 6,700  
Amortization and Impairment (2,122)  
Net book value 4,578 5,583
Field equipment [Member]    
Property, Plant and Equipment [Line Items]    
Cost 19,627  
Amortization and Impairment (19,627)  
Net book value 0 341
Computer equipment [Member]    
Property, Plant and Equipment [Line Items]    
Cost 11,130  
Amortization and Impairment (5,510)  
Net book value $ 5,620 $ 8,402
XML 48 R35.htm IDEA: XBRL DOCUMENT v3.8.0.1
PLANT AND EQUIPMENT (Details Textual) - USD ($)
9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Property, Plant and Equipment [Line Items]    
Depreciation $ 4,128 $ 82,053
XML 49 R36.htm IDEA: XBRL DOCUMENT v3.8.0.1
INTANGIBLES (Details) - USD ($)
Sep. 30, 2017
Dec. 31, 2016
Finite-Lived Intangible Assets [Line Items]    
Cost $ 358,000  
Amortization and Impairment (358,000)  
Net book value 0 $ 0
License agreements [Member]    
Finite-Lived Intangible Assets [Line Items]    
Cost 350,000  
Amortization and Impairment (350,000)  
Net book value 0 0
Website development [Member]    
Finite-Lived Intangible Assets [Line Items]    
Cost 8,000  
Amortization and Impairment (8,000)  
Net book value $ 0 $ 0
XML 50 R37.htm IDEA: XBRL DOCUMENT v3.8.0.1
INTANGIBLES (Details Textual) - USD ($)
9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Jun. 30, 2016
Finite-Lived Intangible Assets [Line Items]      
Amortization, Total $ 0 $ 52,500  
Plasma Pulse Technology [Member]      
Finite-Lived Intangible Assets [Line Items]      
Licensing Agreement, Arrears to be Paid     $ 1,000,000
Accrued Royalties     $ 1,458,333
XML 51 R38.htm IDEA: XBRL DOCUMENT v3.8.0.1
ACCRUED LIABILITIES AND OTHER PAYABLES (Details) - USD ($)
Sep. 30, 2017
Dec. 31, 2016
Royalties payable $ 14,653 $ 14,653
Other 207 0
Severance accrual 0 19,814
Accrued Liabilities, Current, Total $ 14,860 $ 34,467
XML 52 R39.htm IDEA: XBRL DOCUMENT v3.8.0.1
STOCKHOLDERS' EQUITY (Details) - Employee Stock Option [Member] - $ / shares
9 Months Ended 12 Months Ended
Sep. 30, 2017
Dec. 31, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Shares option activity, Outstanding Balance (in shares) 3,380,950 380,950
Shares option activity, Granted (in shares) 0 4,000,000
Shares option activity, Forfeited/cancelled (in shares) (3,000,000) (1,000,000)
Shares option activity, Exercised (in shares) 0 0
Shares option activity, Outstanding Balance (in shares) 380,950 3,380,950
Exercise price per share, Outstanding Balance (in dollars per share) $ 0.18 $ 0.18
Exercise price per share, Granted (in dollars per share) 0 0.09
Exercise price per share, Forfeited/cancelled (in dollars per share) 0.08 0.08
Exercise price per share, Exercised (in dollars per share) 0 0
Exercise price per share, Outstanding Ending (in dollars per share) 0.90 0.18
Minimum [Member]    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Exercise price per share, Outstanding Balance (in dollars per share) 0.09 0.08
Exercise price per share, Granted (in dollars per share)   0.08
Exercise price per share, Outstanding Ending (in dollars per share) 0.51 0.09
Maximum [Member]    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Exercise price per share, Outstanding Balance (in dollars per share) 13.50 13.50
Exercise price per share, Granted (in dollars per share)   0.09
Exercise price per share, Outstanding Ending (in dollars per share) $ 13.50 $ 13.50
XML 53 R40.htm IDEA: XBRL DOCUMENT v3.8.0.1
STOCKHOLDERS' EQUITY (Details 1) - Employee Stock Option [Member]
9 Months Ended
Sep. 30, 2017
$ / shares
shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Options Outstanding, Weighted Average Exercise Price | $ / shares $ 0.90
Options Outstanding, Number Outstanding (in shares) 380,950
Options Outstanding, Weighted Average Remaining Contractual life in years 2 years 8 months 12 days
Options Exercisable, Weighted Average Exercise Price | $ / shares $ 0.90
Options Exercisable, Number Exercisable (in shares) 380,950
Exercise Price Range One [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Options Outstanding, Weighted Average Exercise Price | $ / shares $ 13.50
Options Outstanding, Number Outstanding (in shares) 3,480
Options Outstanding, Weighted Average Remaining Contractual life in years 1 year 8 months 16 days
Options Exercisable, Number Exercisable (in shares) 3,480
Exercise Price Range Two [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Options Outstanding, Weighted Average Exercise Price | $ / shares $ 12.50
Options Outstanding, Number Outstanding (in shares) 2,000
Options Outstanding, Weighted Average Remaining Contractual life in years 3 years 11 days
Options Exercisable, Number Exercisable (in shares) 2,000
Exercise Price Range Three [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Options Outstanding, Weighted Average Exercise Price | $ / shares $ 8.50
Options Outstanding, Number Outstanding (in shares) 500
Options Outstanding, Weighted Average Remaining Contractual life in years 3 years 9 months
Options Exercisable, Number Exercisable (in shares) 500
Exercise Price Range Four [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Options Outstanding, Weighted Average Exercise Price | $ / shares $ 5.00
Options Outstanding, Number Outstanding (in shares) 14,800
Options Outstanding, Weighted Average Remaining Contractual life in years 4 years 14 days
Options Exercisable, Number Exercisable (in shares) 14,800
Exercise Price Range Five [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Options Outstanding, Weighted Average Exercise Price | $ / shares $ 0.65
Options Outstanding, Number Outstanding (in shares) 36,924
Options Outstanding, Weighted Average Remaining Contractual life in years 5 years 6 months
Options Exercisable, Number Exercisable (in shares) 36,924
Exercise Price Range Six [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Options Outstanding, Weighted Average Exercise Price | $ / shares $ 0.63
Options Outstanding, Number Outstanding (in shares) 38,096
Options Outstanding, Weighted Average Remaining Contractual life in years 9 months
Options Exercisable, Number Exercisable (in shares) 38,096
Exercise Price Range Seven [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Options Outstanding, Weighted Average Exercise Price | $ / shares $ 0.51
Options Outstanding, Number Outstanding (in shares) 285,150
Options Outstanding, Weighted Average Remaining Contractual life in years 2 years 6 months 14 days
Options Exercisable, Number Exercisable (in shares) 285,150
XML 54 R41.htm IDEA: XBRL DOCUMENT v3.8.0.1
STOCKHOLDERS' EQUITY (Details 2) - Warrant [Member]
9 Months Ended
Sep. 30, 2017
$ / shares
shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Warrants Outstanding, Number Outstanding 6,339,498
Warrants Outstanding, Weighted Average Remaining Contractual life in years 1 year 9 months 7 days
Warrants Outstanding, Weighted Average Exercise Price | $ / shares $ 0.24
Warrants Exercisable, Number Exercisable 6,339,498
Warrants Exercisable, Weighted Average Exercise Price | $ / shares $ 0.24
Exercise Price Range One [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Warrants Outstanding, Exercise Price | $ / shares $ 0.30
Warrants Outstanding, Number Outstanding 375,000
Warrants Outstanding, Weighted Average Remaining Contractual life in years 1 year 29 days
Warrants Exercisable, Number Exercisable 375,000
Exercise Price Range Two [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Warrants Outstanding, Exercise Price | $ / shares $ 0.25
Warrants Outstanding, Number Outstanding 1,751,667
Warrants Outstanding, Weighted Average Remaining Contractual life in years 1 year 8 months 26 days
Warrants Exercisable, Number Exercisable 1,751,667
Exercise Price Range Three [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Warrants Outstanding, Exercise Price | $ / shares $ 0.15
Warrants Outstanding, Number Outstanding 525,500
Warrants Outstanding, Weighted Average Remaining Contractual life in years 1 year 8 months 26 days
Warrants Exercisable, Number Exercisable 525,500
Exercise Price Range Four [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Warrants Outstanding, Exercise Price | $ / shares $ 0.25
Warrants Outstanding, Number Outstanding 1,508,333
Warrants Outstanding, Weighted Average Remaining Contractual life in years 1 year 10 months 2 days
Warrants Exercisable, Number Exercisable 1,508,333
Exercise Price Range Five [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Warrants Outstanding, Exercise Price | $ / shares $ 0.15
Warrants Outstanding, Number Outstanding 577,499
Warrants Outstanding, Weighted Average Remaining Contractual life in years 1 year 10 months 6 days
Warrants Exercisable, Number Exercisable 577,499
Exercise Price Range Six [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Warrants Outstanding, Exercise Price | $ / shares $ 0.25
Warrants Outstanding, Number Outstanding 968,166
Warrants Outstanding, Weighted Average Remaining Contractual life in years 1 year 10 months 6 days
Warrants Exercisable, Number Exercisable 968,166
Exercise Price Range Seven [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Warrants Outstanding, Exercise Price | $ / shares $ 0.25
Warrants Outstanding, Number Outstanding 633,333
Warrants Outstanding, Weighted Average Remaining Contractual life in years 1 year 10 months 24 days
Warrants Exercisable, Number Exercisable 633,333
XML 55 R42.htm IDEA: XBRL DOCUMENT v3.8.0.1
STOCKHOLDERS' EQUITY (Details Textual) - USD ($)
1 Months Ended 9 Months Ended
Mar. 31, 2017
Jan. 31, 2016
Sep. 30, 2017
Sep. 30, 2016
Jan. 02, 2017
Dec. 31, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]            
Share-based Compensation, Total     $ 18,066 $ 66,035    
Chief Executive Officer [Member]            
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]            
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested Options Forfeited, Number of Shares 2,000,000          
Employee Stock Option [Member]            
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]            
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Beginning Balance     380,950     380,950
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Intrinsic Value     $ 0     $ 0
Share-based Compensation, Total     18,066 $ 66,035    
Non-Plan Stock Options [Member] | Chief Executive Officer [Member]            
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]            
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross   3,000,000        
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price   $ 0.08        
Non-Plan Stock Options [Member] | Chief Executive Officer [Member] | First Anniversary [Member]            
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]            
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Number         1,000,000  
Non-Plan Stock Options [Member] | Chief Executive Officer [Member] | Second Anniversary [Member]            
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]            
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Number   1,000,000        
Non-Plan Stock Options [Member] | Chief Executive Officer [Member] | Third Anniversary [Member]            
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]            
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Number   1,000,000        
Warrant [Member]            
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]            
Warrants Outstanding Intrinsic Value     0     $ 0
Series B Preferred Stock [Member]            
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]            
Undeclared Dividends     154,553      
Series C Preferred Stock [Member]            
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]            
Undeclared Dividends     $ 1,402,110      
XML 56 R43.htm IDEA: XBRL DOCUMENT v3.8.0.1
OTHER INCOME (Details) - USD ($)
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
License fee forgiven $ 0 $ 4,059 $ 0 $ 203,296
XML 57 R44.htm IDEA: XBRL DOCUMENT v3.8.0.1
OTHER INCOME (Details Textual) - USD ($)
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
License Fee Forgiven $ 0 $ 4,059 $ 0 $ 203,296
Other Nonoperating Income (Expense) [Member]        
License Fee Forgiven     $ 200,000  
XML 58 R45.htm IDEA: XBRL DOCUMENT v3.8.0.1
NET LOSS PER SHARE (Details) - shares
9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount 162,095,448 166,095,448
Employee Stock Option [Member]    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount 380,950 4,380,950
Warrant [Member]    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount 6,339,498 6,339,498
Series A Preferred Stock [Member]    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount 31,375,000 31,375,000
Series B Preferred Stock [Member]    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount 4,000,000 4,000,000
Series C Preferred Stock [Member]    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount 120,000,000 120,000,000
XML 59 R46.htm IDEA: XBRL DOCUMENT v3.8.0.1
RELATED PARTY TRANSACTIONS (Details Textual) - Chief Executive Officer [Member] - USD ($)
1 Months Ended 12 Months Ended
Jan. 31, 2016
Dec. 31, 2016
Related Party Transaction [Line Items]    
Officers' Compensation $ 265,000 $ 165,000
Severance Costs   $ 65,000
Boutte [Member]    
Related Party Transaction [Line Items]    
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Number 1,000,000  
Deferred Compensation Arrangement with Individual, Cash Awards Granted, Percentage 55.00%  
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross 3,000,000  
Boutte [Member] | Deferred Bonus [Member]    
Related Party Transaction [Line Items]    
Officers' Compensation $ 60,000  
XML 60 R47.htm IDEA: XBRL DOCUMENT v3.8.0.1
COMMITMENTS AND CONTINGENCIES (Details) - Licensing Agreements [Member]
Sep. 30, 2017
USD ($)
Finite-Lived Intangible Assets [Line Items]  
2017 $ 500,000
2018 500,000
2019 500,000
2020 500,000
2021 500,000
Total $ 2,500,000
XML 61 R48.htm IDEA: XBRL DOCUMENT v3.8.0.1
COMMITMENTS AND CONTINGENCIES (Details Textual)
1 Months Ended 9 Months Ended
Sep. 30, 2017
USD ($)
a
May 31, 2017
USD ($)
Sep. 30, 2017
USD ($)
a
Claims By Creditors $ 372,090   $ 372,090
Claims Against Long Term Liabilities $ 848,916   $ 848,916
Lease Expiration Date Nov. 30, 2017   May 31, 2019
Term Of Operating Leases     39 months
Lease Commencement Date     Mar. 01, 2016
Operating Leases, Rent Expense, Minimum Rentals $ 530   $ 3,410
Operating Leases Rent Expense Escalation Rate     1.70%
Area of Real Estate Property | a 3,733   3,733
Security Deposit Forfeited   $ 6,968  
Payments for Rent   $ 2,000  
XML 62 R49.htm IDEA: XBRL DOCUMENT v3.8.0.1
SUBSEQUENT EVENTS (Details Textual)
Sep. 30, 2017
USD ($)
Subsequent Event [Line Items]  
Disposal Group, Including Discontinued Operation, Consideration $ 650,000
Stock Repurchase Program, Authorized Amount $ 8,500,000
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