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 June 30, 2019

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.)

576 S. Foothills Plaza Dr. #163

Maryville, Tennessee 37801

(Address of principal executive offices) (Zip Code)

(865) 227-4818

(Registrant’s telephone number, including area code)

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

Securities registered pursuant to Section 12(b) of the Act: None.

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
None	N/A	N/A

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted every Interactive Data File required to be submitted 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 such files). Yes x No ¨

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	x	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 484,256,464 shares of common stock outstanding as of August 10, 2019.

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. 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.

2

PLEDGE PETROLEUM CORP.

FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2019

TABLE OF CONTENTS

		Page
	PART I—FINANCIAL INFORMATION
Item l.	Financial Statements	F-1
	Condensed Consolidated Balance Sheets as of June 30, 2019 (Unaudited) and December 31, 2018	F-1
	Unaudited Condensed Consolidated Statement of Operations for the three and six months ended June 30, 2019	F-2
	Unaudited Condensed Consolidated Statement of Stockholders’ Deficit for the three and six months ended June 30, 2019	F-3
	Unaudited Condensed Consolidated Statement of Cash Flows for the six months ended June 30, 2019	F-4
	Notes to the Unaudited Condensed Consolidated Financial Statements	F-5
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	4
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	6
Item 4.	Controls and Procedures	6
	PART II—OTHER INFORMATION
Item 1.	Legal Proceedings	7
Item 1A.	Risk Factors	7
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	7
Item 3.	Defaults Upon Senior Securities	7
Item 4.	Mine Safety Disclosures	7
Item 5.	Other Information	7
Item 6.	Exhibits	8
SIGNATURES		9

3

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements.

PLEDGE PETROLEUM CORP.

CONDENSED CONSOLIDATED BALANCE SHEETS

	June 30, 2019			December 31, 2018
	(Unaudited)
ASSETS
Current assets:
Cash	$	5,784		$	21,140
Prepaid expenses		14,575			11,270
Prepaid stock compensation – related party		83,333			133,333
Total current assets		103,692			165,743
Plant and equipment, net		2,233			3,885
Deposits		-			1,750
Total assets	$	105,925		$	171,378
LIABILITIES AND STOCKHOLDERS' (DEFICIT) EQUITY
Current liabilities:
Accounts payable	$	321,002		$	81,097
Accrued expenses and other payables		1,358			11,521
Accrued interest		4,763			-
Derivative liability		273,105			-
Convertible note payable, net of discount of $108,091		47,909			-
Due to related parties		137,500			5,890
Loan payable – related party		5,000			5,000
Total current liabilities		790,637			103,508
Total liabilities		790,637			103,508
Commitments and contingencies (Note 9)
Stockholders' (Deficit) Equity:
Series A Convertible Preferred stock, $0.01 par value; 5,000,000 shares  designated, no shares issued and outstanding		-			-
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, no shares outstanding		-			-
Common stock, $0.001 par value; 500,000,000 shares authorized,  484,256,464 shares issued and outstanding		484,257			484,257
Accumulated deficit		(1,169,009	)		(416,427	)
Total stockholders' (deficit) equity		(684,712	)		67,870
Total Liabilities and Stockholders' (Deficit) Equity	$	105,925		$	171,378

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

F-1

PLEDGE PETROLEUM CORP.

CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

(Unaudited)

	For the Three Months Ended June 30, 2019			For the Six Months Ended June 30, 2019
Expenses:
Professional fees	$	51,258		$	82,258
Directors fees		90,000			180,000
Compensation – related party		15,000			30,000
Non-cash stock compensation – related party		25,000			50,000
General and administrative		97,542			235,271
Total expenses		278,800			577,529
Loss from operations		(278,800	)		(577,529	)
Other income (expense):
Interest expense		(8,120	)		(10,039	)
Debt discount amortization		(28,438	)		(47,909	)
Change in the fair value of convertible debt		4,005			201,158
Loss on issuance of convertible debt		(42,143	)		(318,263	)
Total other expense, net		(74,696	)		(175,053	)
Loss before Provision for Income Taxes		(353,496	)		(752,582	)
Provision for Income Taxes		-			-
Net Loss	$	(353,496	)	$	(752,582	)
Undeclared Series B and Series C Preferred stock dividends		(7,978	)		(15,869	)
Net loss available to common stockholders	$	(361,474	)	$	(768,451	)
Net Loss Per Share - Basic and Diluted	$	(0.00	)	$	(0.00	)
Weighted Average Number of Shares Outstanding - Basic and Diluted		484,256,464			484,256,464

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

F-2

PLEDGE PETROLEUM CORP.

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’ (DEFICIT) EQUITY

For the Three and Six Months Ended June 30, 2019

(Unaudited)

	Series A-1 Preferred Stock				Series B Preferred Stock				Series C Preferred Stock				Common Stock				Accumulated
	Shares		Amount		Shares		Amount		Shares		Amount		Shares		Amount		Deficit			Total
Balance, December 31, 2018		-	$	-		40,000	$	40		-	$	-		484,256,464	$	484,257	$	(416,427	)	$	67,870
Net loss		-		-		-		-		-		-		-		-		(399,086	)		(399,086	)
Balance, March 31, 2019		-		-		40,000		40		-		-		484,256,464		484,257		(815,513	)		(331,216	)
Net loss		-		-		-		-		-		-		-		-		(353,496	)		(353,496	)
Balance, June 30, 2019		-	$	-		40,000	$	40		-	$	-		484,256,464	$	484,257	$	(1,169,009	)	$	(684,712	)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

F-3

PLEDGE PETROLEUM CORP.

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

(Unaudited)

	For the Six Months Ended June 30, 2019
Cash flow from operating activities:
Net Loss	$	(752,582	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		1,651
Stock based compensation – related party		50,000
Debt discount amortization		47,909
Change in the fair value of convertible debt		(201,158	)
Loss on issuance of convertible debt		318,263
Changes in operating assets and liabilities:
Prepaid expenses		2,695
Deposits		1,750
Accounts payable and accruals		234,506
Due to related parties		131,610
Net cash used in operating activities		(165,356	)
Cash flows from financing activities:
Loan from a related party		6,800
Repayment of related party loan		(6,800	)
Proceeds from convertible debt		150,000
Net cash provided by financing activities		150,000
Net decrease in cash		(15,356	)
Cash at beginning of period		21,140
Cash at end of period	$	5,784
Cash paid during the period for:
Interest	$	5,276
Income taxes	$	-

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

F-4

PLEDGE PETROLEUM CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2019

(Unaudited)

NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS

On December 19, 2018, Pledge Petroleum Corp. (the “Company”) entered into a Share Exchange agreement with Renewable Technology Solutions, Inc. (“RTS”). Pursuant to the terms of the agreement, in exchange for 100% of the RTS shares, the Company will issue a stock certificate registered in the name of the RTS stockholder for 250,000,000 shares of its common stock. The transaction will be accounted for as a “reverse acquisition” and recapitalization, with RTS being the accounting acquirer. A reverse merger transaction with a public company is considered and accounted for as a capital transaction in substance; it is equivalent to the issuance of Pledge’s common stock for the net monetary assets of RTS, accompanied by a recapitalization. Accordingly, the accounting does not contemplate the recognition of unrecorded assets of the accounting acquiree, such as goodwill. Consolidated financial statements presented herein reflect the consolidated financial assets and liabilities of the Company at their historical costs, giving effect to the recapitalization, as if it had been RTS during the periods presented.

RTS was incorporated in the State of Tennessee on August 22, 2018. The Company was formed in order to conduct business in the sourcing and implementation of renewable energy technology.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation

The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and footnotes for the period from August 22, 2018 (date of inception) through December 31, 2018 included on the Company’s Form 10-K. The results of the six months ended June 30, 2019 are not necessarily indicative of the results to be expected for the full year ending December 31, 2019.

In the opinion of management, all adjustments necessary to present fairly the financial position as of June 30, 2019 and the results of operations and cash flows presented herein have been included in the financial statements. All such adjustments are of a normal and recurring nature. Interim results are not necessarily indicative of results of operations for the full year.

Use of estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary RTS. All significant intercompany transactions and balances have been eliminated.

Fair Value of Financial Instruments

The Company follows paragraph 825-10-50-10 of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of the FASB ASC (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in U.S. GAAP, and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three broad levels.  The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below:

Level 1: Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.

F-5

Level 2: Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.

Level 3: Pricing inputs that are generally unobservable inputs and not corroborated by market data.

The carrying amount of the Company’s financial assets and liabilities, such as cash, prepaid expenses and accrued expenses approximate their fair value because of the short maturity of those instruments. The Company’s notes payable approximates the fair value of such instruments as the notes bear interest rates that are consistent with current market rates.

The following table classifies the Company’s liabilities measured at fair value on a recurring basis into the fair value hierarchy as of:

June 30, 2019:

Description	Level 1		Level 2		Level 3		Total Gains and (Losses)
Derivative	$	-	$	-	$	273,105	$	201,158

Net Loss per Share

Net loss per common share is computed pursuant to section 260-10-45 of the ASC.  Basic net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period.  Diluted net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock and potentially outstanding shares of common stock during the period.  The weighted average number of common shares outstanding and potentially outstanding common shares assumes that the Company incorporated as of the beginning of the first period presented. 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 three and six months ended June 30, 2019, all stock options, unvested restricted stock awards, warrants, 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.

Recently issued accounting pronouncements

On June 20, 2018, the FASB issued ASU 2018-07, Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. ASU 2018-07 is intended to reduce cost and complexity and to improve financial reporting for share-based payments to nonemployees (for example, service providers, external legal counsel, suppliers, etc.). Under the new standard, companies will no longer be required to value non-employee awards differently from employee awards. Meaning that companies will value all equity classified awards at their grant-date under ASC718 and forgo revaluing the award after this date. The guidance is effective for interim and annual periods beginning after December 15, 2018. The adoption of this standard has had no material impact.

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). The ASU requires that a lessee recognize the assets and liabilities that arise from operating leases. A lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. This new guidance will be effective for annual reporting periods beginning after December 15, 2018, including interim periods within those annual reporting periods, and early adoption is permitted. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The adoption of this standard has had no material impact.

The Company has implemented all new accounting pronouncements that are in effect.  These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

F-6

NOTE 3 – GOING CONCERN

The Company’s condensed consolidated financial statements have been prepared on a going concern basis, which assumes that the Company will be able to realize its assets and discharge its liabilities and commitments in the normal course of business for the foreseeable future. The Company has just begun its operations and does not yet have operations or revenue to cover its operating expenses. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The ability to continue as a going concern is dependent upon generating profitable operations in the future and/or to obtain the necessary financing to meet the Company’s obligations and repay its liabilities arising from normal business operations when they come due. Management intends to finance operating costs over the next twelve months with debt and equity financing. While the Company believes that it will be successful in obtaining the necessary financing and generating revenue to fund its operations, meet regulatory requirements and achieve commercial goals, there are no assurances that such additional funding will be achieved and that it will succeed in its future operations. The financial statements of the Company do not include any adjustments that may result from the outcome of these uncertainties.

NOTE 4 – CONVERTIBLE NOTE PAYABLE

On January 22, 2019, the Company executed a converted promissory note with Redstart Holdings Corp. (“Redstart”) for $103,000. The note is unsecured, bears interest at 10% per annum and matures on January 22, 2020. The note is convertible, after 180 days, into shares of common stock at the rate of 61% (39% discount) of the average of the lowest three trading prices in the twenty trading days preceding the conversion. The Company bifurcated the conversion feature and accounted for it as a derivative liability. The Company recorded the derivative liability at its fair value of $379,120 based on the Black Scholes Merton pricing model and a corresponding debt discount of $103,000 to be amortized utilizing the interest method of accretion over the term of the note. As of June 30, 2019, the Company fair valued the derivative at $176,915. In addition, $45,150 of the debt discount has been amortized to interest expense.

On June 11, 2019, the Company executed a converted promissory note with Geneva Roth Remark Holdings, Inc. (“Geneva”) for $53,000. The note is unsecured, bears interest at 10% per annum and matures on June 10, 2020. The note is convertible, after 180 days, into shares of common stock at the rate of 61% (39% discount) of the average of the lowest three trading prices in the twenty trading days preceding the conversion. The Company bifurcated the conversion feature and accounted for it as a derivative liability. The Company recorded the derivative liability at its fair value of $95,143 based on the Black Scholes Merton pricing model and a corresponding debt discount of $53,000 to be amortized utilizing the interest method of accretion over the term of the note. As of June 30, 2019, the Company fair valued the derivative at $96,190. In addition, $2,759 of the debt discount has been amortized to interest expense.

A summary of the activity of the derivative liability for the notes above is as follows:

Balance at December 31, 2018	$	-
Increase to derivative due to new issuances		474,263
Derivative gain due to mark to market adjustment		(201,158	)
Balance at June 30, 2019	$	273,105

A summary of quantitative information about significant unobservable inputs (Level 3 inputs) used in measuring the Company’s derivative liability that are categorized within Level 3 of the fair value hierarchy for the six months ended June 30, 2019 is as follows:

Inputs	June 30, 2019		Initial Valuation
Stock price	$	0.045		$ 0.0406 – 0.045
Conversion price	$	0.0221		$ 0.0105 – 0.0226
Volatility (annual)		286.6% - 317.49%		292% - 318.13%
Risk-free rate		1.92% - 2.09%		2.05 - 2.59%
Years to maturity		.56 – 0.95		1

The development and determination of the unobservable inputs for Level 3 fair value measurements and fair value calculations are the responsibility of the Company’s management

NOTE 5 – RELATED PARTY TRANSACTIONS

On May 2, 2018, the Company issued to each of its three directors, 10,000,000 shares of restricted common stock, vesting as to 1/3 of the grant immediately, 1/3 of the grant on the one-year anniversary of the grant date and 1/3 of the grant on the two-year anniversary of the grant date. The value of the stock has been debited to prepaid stock compensation and will be amortized over the vesting period. As of June 30, 2019, and December 31, 2018, there is $83,333 and $133,333 of prepaid stock compensation, respectively.

F-7

The restricted stock granted and exercisable at June 30, 2019 is as follows:

		Restricted Stock Granted				Restricted Stock Vested
Grant date price		Number granted		Weighted average exercise price		Number vested		Weighted average exercise price
$	0.01		30,000,000	$	0.01		20,000,000	$	0.01

The Company recorded an expense of $25,000 and $50,000 for the three and six months ended June 30, 2019, respectively, related to the restricted stock granted to the directors.

As of June 30, 2019 and December 31, 2018, $137,500 and $5,890, respectively, is owed to the three directors of the Company for director fees and various advances for services provided in the normal course of business. All amounts due are unsecured, non-interest bearing and due on demand.

On December 31, 2018, the Company executed a promissory note with John Huemoeller, Chairman, for $5,000. The promissory note is unsecured, bears interest at 5% and is due on or before December 31, 2019.

NOTE 6 – PREFERRED STOCK

Series A-1 Preferred

The Company has designated 5,000,000 preferred shares as Series A-1 Convertible Preferred Stock (“Series A-1 Shares”). Each share of Series A-1 is convertible into ten shares of common stock and has voting rights equal to the number of shares of common stock that holders can convert into. The Series A-1 Shares are non-redeemable by the Company and are entitled to a liquidation preference of $0.08 per share. As of June 30, 2019, there are no shares of Series A-1 Preferred outstanding.

Series B Preferred

The Company has designated 500,000 preferred shares as Series B Convertible Preferred Stock (“Series B Shares”), with 40,000 Series B Shares issued and outstanding as of June 30, 2019, which are convertible into 4,000,000 shares of common stock.

The rights, privileges and preferences of the Series B Shares are summarized as follows:

Conversion

Each share of the Series B Shares is convertible at any time prior to the issuance of a redemption notice by the Company into such number of shares of Common Stock by dividing the Stated value ($10) of the Series B Shares by $0.10 and is subject to adjustment for dividends or distributions made in common stock, the issue of securities convertible into common stock, stock splits, reverse stock splits, or reclassifications of common stock.

Company Redemption

The Company has the right, at any time after the date the Series B Shares have been issued, to redeem all or a portion of any Holder's Series B Shares at a price per Series B Share equal to the issue price per Series B Share multiplied by 120%.

Voting Rights

Each holder of Series B Shares is entitled to vote on all matters submitted to a vote of the stockholders of the Company and is entitled to votes equal to the number of shares of Common Stock into which Series B Shares could be converted, and the holders of shares of Series B Shares and Common Stock will vote together as a single class on all matters submitted to the stockholders of the Company. 

Dividends

The holders of the Series B Shares are entitled to receive cumulative dividends at the rate of eight percent per annum of the issue price per share, accrued daily and payable annually in arrears on December 31st of each year. Such dividends accrue on any given share from the day of original issuance of such share. Such dividends are cumulative, whether or not declared by the Board of Directors, but are non-compounding. Any dividend payable on a dividend payment date may be paid, at the option of the Company, either (i) in cash or (ii) in shares of common stock at an issue price of $0.10 per common share. In the event that pursuant to applicable law or contract the Company is prohibited or restricted from paying in cash the full dividends to which the holders of the Series B Shares are entitled, the cash amount available pursuant to applicable law or contract will be distributed among the holders of the Series B Shares ratably in proportion to the full amounts to which they would otherwise be entitled and any remaining amount due to holders of the Series B Shares will be payable in cash.

F-8

Liquidation Preference

In the event of any liquidation, dissolution or winding up of the Company, either voluntary or involuntary, the holders of the Series B Shares are entitled to receive, prior and in preference to any distribution of any assets of the Company to the holders of any other preferred stock of the Company and subordinate to any distribution to the Series A-1 Shares, and prior and in preference to any distribution of any assets of the Company to the holders of the Common Stock, the amount of 120% of the issue price per share. In addition, the Series B holder has agreed to vote to subordinate the series B Preferred stock liquidation preferences to the Series C Preferred stock preferences.

The Company has undeclared dividends on the Series B Preferred stock amounting to $201,096 as of June 30, 2019. 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 takes into account these undeclared dividends.

Series C Preferred

The Company has designated 4,500,000 preferred shares as Series C Convertible Preferred Stock (“Series C Shares”). Each share of Series C is convertible into 120,000,000 shares of common stock and has voting rights equal to the number of shares of common stock that holders can convert into. The Series C Shares are non-redeemable by the Company and are entitled to a liquidation preference. As of June 30, 2019, there are no shares of Series C Preferred outstanding.

NOTE 7 – STOCK OPTIONS

The Company’s Board of Directors approved the Company’s 2008 Stock Option Plan (the “Stock Plan”) for the issuance of up to 5,000,000 shares of common stock to be granted through incentive stock options, nonqualified stock options, stock appreciation rights, dividend equivalent rights, restricted stock, restricted stock units and other stock-based awards to officers, other employees, directors and consultants of the Company and its subsidiaries. After the reverse stock split in August 2012, a total of 100,000 shares were available for grant. Subsequent to the reverse split the Board of Directors approved an increase in the number of awards available for grant to 2,100,000 shares. The exercise price of stock options under the Stock Plan is determined by the Board of Directors, and may be equal to or greater than the fair market value of the Company’s common stock on the date the option is granted. Options become exercisable over various periods from the date of grant, and generally expire ten years after the grant date.

At June 30, 2019, there were 54,224 plan options outstanding, under the Stock Option Plan.

The vesting provisions for these stock options are determined by the board of directors at the time of grant, there are no unvested options outstanding as of June 30, 2019.

In the event of the employees’ termination, the Company will cease to recognize compensation expense.

A summary of all of our option activity during the period ended June 30, 2019 is as follows:

	No. of shares			Exercise price per share		Weighted average exercise price
From August 22, 2018		-		$	-	$	-
Granted - non-plan options		-			-		-
Forfeited/cancelled		-			-		-
Exercised		-			-		-
Effects of recapitalization from reverse acquisition		57,704			$0.65 to $13.50		3.02
Outstanding December 31, 2018		57,704			$0.65 to $13.50	$	3.02
Granted - non-plan options		-			-		-
Forfeited/cancelled		(3,480	)		-		-
Exercised		-			-		-
Outstanding June 30, 2019		54,224			$0.65 to $12.50	$	2.77

F-9

The options outstanding and exercisable at June 30, 2019 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
$	12.50		2,000		1.28				2,000
$	8.50		500		2.00				500
$	5.00		14,800		2.29				14,800
$	0.65		36,924		3.75				36,924
			54,224		3.25		2.35		54,224	$	2.35

NOTE 8 – WARRANTS

The warrants outstanding and exercisable at June 30, 2019 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
$	0.25		1,508,333		0.09				1,508,333
$	0.15		577,499		0.10				577,499
$	0.25		968,166		0.10				968,166
$	0.25		633,333		0.15				633,333
			3,687,331		0.11	$	0.14		3,687,331	$	0.14

No warrants were issued or exercised from August 22, 2018 through June 30, 2019. A total of 2,652,167 warrants have expired during the period from August 22, 2018 through June 30, 2019.

NOTE 9 – COMMITMENTS AND CONTINGENCIES

During the normal course of business, the Company may be exposed to litigation. When the Company becomes aware of potential litigation, it evaluates the merits of the case in accordance with FASB ASC 450-20-50, Contingencies. The Company evaluates its exposure to the matter, possible legal or settlement strategies and the likelihood of an unfavorable outcome. If the Company determines that an unfavorable outcome is probable and can be reasonably estimated, it establishes the necessary accruals. As of June 30, 2019, the Company is not aware of any contingent liabilities that should be reflected in the unaudited condensed consolidated financial statements.

NOTE 10 – SUBSEQUENT EVENTS

Management has evaluated subsequent events pursuant to the requirements of ASC Topic 855, from the balance sheet date through the date the consolidated financial statements were available to be issued and has determined that there are no material subsequent events that require disclosure in the unaudited condensed consolidated financial statements.

F-10

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, 2018 and the other information set forth in our Annual Report on Form 10-K for the period from August 22, 2018 (date of inception) through December 31, 2018 filed with the SEC on April 16, 2019. 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.

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 for the quarterly period ended June 30, 2019 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

Our Company

Our goal is to be a next-generation renewable fuels company. We intend to conduct business in the sourcing and implementation of renewable energy technology.

Our mission is to produce renewable diesel fuel and biochar in a profitable yet sustainable manner, all while building value for our shareholders. We strive to achieve net environmental and social benefits and intend to achieve a negative carbon footprint, by responsibly managing our land use and water resources, and preserving our forests and food sources, while promoting energy independence, job creation and community investment.

Our technology platform is designed to enable us to convert low-cost, abundant and sustainable biomass feedstock (i.e., slash) into diesel. Our renewable diesel, is expected to burn much cleaner than traditional petroleum diesel, and to be chemically indistinguishable from conventional ASTM D975 diesel. Importantly, the renewable diesel we intend to produce will be a “drop-in” diesel; meaning it is a 100% petroleum diesel replacement allowing our renewable diesel to offer significant reduction in our customer’s carbon footprint, without the need for any infrastructure changes.

In addition to renewable diesel, we intend to sell Natura ^TM, which, as a result of the high temperature it is created at, is a very high-quality biochar. Biochar is used as a soil amendment. Biochar is a stable and solid, rich in carbon, and can endure in soil for thousands of years. Biochar is made by carbonizing renewable organics like wood and grass. Natura ^TM is a safe and natural product made in the United States. It is a byproduct of our renewable diesel process and provides long-term gains in soil fertility and plant performance, as well as livestock enhancement.

We are fundamentally different from traditional oil and biofuels companies. Unlike traditional oil companies, we intend to generate diesel from completely renewable and sustainable sources rather than depleting fossil fuel reserves. At the same time, we differ from most traditional biofuels companies because our end products are diesel and biochar rather than alcohols or fatty acid methyl esters (“FAME”), such as ethanol or biodiesel. As compared to ethanol, the energy density of one gallon of our renewable diesel equates to 1.7 gallons of ethanol equivalent. While we are a development stage, pre-revenue company, our unique, proven technology platform is anticipated to provide a new domestic source of economic, clean liquid transportation fuel — sustainably — using renewable natural resources to help further energy independence and reduce greenhouse gas emissions.

4

Management Discussion and Analysis of Financial Condition

Our discussion and analysis of our financial condition and results of operations are based upon our unaudited condensed consolidated financial statements for the three and six months ended June 30, 2019, 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 June 30, 2019

Since inception on August 22, 2018, we have not earned any revenue.

During the three months ended June 30, 2019, we incurred professional fees of $51,258. Professional fees consist primarily of legal, audit and accounting expense.

During the three months ended June 30, 2019, we incurred director fees of $90,000 for our three directors.

During the three months ended June 30, 2019, we incurred related party compensation of $15,000.

During the three months ended June 30, 2019, we recognized $25,000 of non-cash stock-based compensation for the amortization of stock issued to our officers.

During the three months ended June 30, 2019, we incurred total general and administrative (“G&A”) expense of $97,542. Our larger G&A expenses were approximately $75,000 for consulting and $10,500 for D&O insurance.

In addition, we had total other expense of $74,696. This consisted of $8,120 of interest expense, $28,438 for debt discount amortization, and a loss on the issuance of convertible debt of $42,143. These expenses were offset with a gain in the change of the fair value of a derivate of $4,005.

Net loss

We incurred a net loss of $353,496 for the three months ended June 30, 2019, which consists primarily of the increase in total expenses discussed above.

Results of Operations for the six months ended June 30, 2019

Since inception on August 22, 2018, we have not earned any revenue.

During the six months ended June 30, 2019, we incurred professional fees of $82,258. Professional fees consist primarily of legal, audit and accounting expense.

During the six months ended June 30, 2019, we incurred director fees of $180,000 for our three directors.

During the six months ended June 30, 2019, we incurred related party compensation of $30,000.

During the six months ended June 30, 2019, we recognized $50,000 of non-cash stock-based compensation for the amortization of stock issued to our officers.

During the six months ended June 30, 2019, we incurred total G&A expense of $235,271. Our larger G&A expenses were approximately $160,000 for consulting and $45,500 for D&O insurance.

5

In addition, we had total other expense of $175,053. This consisted of $10,039 of interest expense, $47,909 for debt discount amortization, and a loss on the issuance of convertible debt of $318,263. These expenses were offset with a gain in the change of the fair value of a derivate of $201,158.

Net loss

We incurred a net loss of $752,582 for the six months ended June 30, 2019, which consists primarily of the increase in total expenses discussed above.

Net loss available to common stockholders

We incurred a net loss available to common stockholders of $768,451, after undeclared dividends of $15,869, for the six months ended June 30, 2019.

 Liquidity and Capital Resources

During the six months ended June 30, 2019, we used cash in operating activities of $165,356. We received $150,000 from the proceeds of convertible notes payable. We also received $6,800 from a related party, which was promptly repaid.

At June 30, 2019, we had a cash balance of $5,784, and liabilities of $790,637. We will need to generate revenue from operations and/or obtain additional financing to pursue our business strategy or to take advantage of opportunities that may arise. These factors raise substantial doubt about our ability to continue as a going concern. To meet our financing needs, we are considering multiple alternatives, including, but not limited to, additional equity financings and, debt financings and/or funding from partnerships. There can be no assurance that we will be able to complete any such transactions on acceptable terms or otherwise.

Off Balance Sheet Arrangements

There are no off balance sheet arrangements.

Critical Accounting Policies

Refer to our Form 10-K for the period from August 22, 2018 (date of inception) through December 31, 2018, for a full discussion of our critical accounting policies.

Recently Issued Accounting Standards

For a discussion of the adoption and potential impacts of recently issued accounting standards, refer to the “Recent Accounting Pronouncements” section of Note 2, in the Notes to condensed consolidated Financial Statements.

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 Exchange Act, the Company carried out an evaluation, with the participation of the Company’s management, including the Company’s Chief Executive Officer and the Company’s Interim Chief Financial Officer, who also serves as our interim principal financial officer and principal 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 and CFO concluded that our disclosure controls and procedures were not effective to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act, is 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 our management, including our Chief Executive Officer, as appropriate, to allow timely decisions regarding required disclosure. Our Chief Executive Officer and our interim Chief Financial Officer have concluded, that as of the date of the filing of this Quarterly Report, our disclosure controls and procedures are not effective and that all material weaknesses and significant deficiencies have not been completely remediated.

6

We intend 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 June 30, 2019 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. 

Limitations on Effectiveness of Controls and Procedures

In designing and evaluating the disclosure controls and procedures and internal control over financial reporting, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures and internal control over financial reporting must reflect the fact that there are resource constraints and that management is required to apply judgment in evaluating the benefits of possible controls and procedures relative to their costs.

PART II—OTHER INFORMATION

Item 1. Legal Proceedings

We are not a party to any material litigation or proceeding and are not aware of any material litigation or proceeding, pending or threatened against us.

Item 1A. Risk Factors

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and, as such, are not required to provide the information under this Item.

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

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

None.

Item 5. Other Information

None. 

7

Item 6. Exhibits

Exhibit Number	Exhibit Description
4.1	Convertible Promissory Note (incorporated by reference to Current Report on Form 8-K filed with the Securities and Exchange Commission on June 20, 2019 (File No. 000-53488))
10.1	Securities Purchase Agreement dated June 11, 2019 by and Between Pledge Petroleum Corp and Geneva Roth remark Holdings, Inc. (incorporated by reference to Current Report on Form 8-K filed with the Securities and Exchange Commission on June 20, 2019 (File No. 000-53488))
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 of 2002*
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 of 2002*
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*

*Filed herewith

8

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: August 19, 2019	PLEDGE PETROLEUM CORP.
	(Registrant)
	By:	/s/ Christopher Headrick
		Name: Christopher Headrick
		Title: Chief Executive Officer and Director
		(Principal Executive Officer)
	By:	/s/ John Zotos
		Name: John Zotos
		Title: Interim Chief Financial Officer
		(Principal Financial and Accounting Officer)

9

EX-31.1

Exhibit 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO RULE 13a-14(a) OR RULE 15d-14(a) OF THE SECURITIES EXCHANGE ACT OF 1934,

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

I, Christopher Headrick, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2019 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: August 19, 2019

/s/ Christopher Headrick

Christopher Headrick

Chief Executive Officer

(Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO RULE 13a-14(a) OR RULE 15d-14(a) OF THE SECURITIES EXCHANGE ACT OF 1934,

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

I, John Zotos, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2019 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: August 19, 2019

/s/ John Zotos

John Zotos

Interim Chief Financial Officer

(Principal Financial and Accounting Officer)

EX-32.1

 Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Pledge Petroleum Corp., a Delaware corporation (the “Company”), on Form 10-Q for the period ended June 30, 2019 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Christopher Headrick, Chief Executive 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/ Christopher Headrick

Christopher Headrick

Chief Executive Officer

(Principal Executive Officer)

August 19, 2019

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Pledge Petroleum Corp., a Delaware corporation (the “Company”), on Form 10-Q for the period ended June 30, 2019 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, John Zotos, 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/ John Zotos

John Zotos

Interim Chief Financial Officer

(Principal Financial and Accounting Officer)

August 19, 2019

XML

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2019	Aug. 10, 2019
Document and Entity Information [Abstract]
Document Type	10-Q
Document Period End Date	Jun. 30, 2019
Entity Registrant Name	PLEDGE PETROLEUM CORP
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		484,256,464
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q2
Entity Central Index Key	0001434110
Amendment Flag	false
Trading Symbol	PROP

XML

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)	Jun. 30, 2019	Dec. 31, 2018
Current assets:
Cash	$ 5,784	$ 21,140
Prepaid expenses	14,575	11,270
Prepaid stock compensation - related party	83,333	133,333
Total current assets	103,692	165,743
Plant and equipment, net	2,233	3,885
Deposits	0	1,750
Total assets	105,925	171,378
Current liabilities:
Accounts payable	321,002	81,097
Accrued expenses and other payables	1,358	11,521
Accrued interest	4,763
Derivative liability	273,105	0
Convertible note payable, net of discount of $108,091	47,909	0
Due to related parties	137,500	5,890
Loan payable - related party	5,000	5,000
Total current liabilities	790,637	103,508
Total liabilities	790,637	103,508
Commitments and contingencies (Note 9)
Stockholders' (Deficit) Equity:
Common stock, $0.001 par value; 500,000,000 shares authorized, 484,256,464 shares issued and outstanding	484,257	484,257
Accumulated deficit	(1,169,009)	(416,427)
Total stockholders' (deficit) equity	(684,712)	67,870
Total Liabilities and Stockholders' (Deficit) Equity	105,925	171,378
Series A Convertible Preferred stock [Member]
Stockholders' (Deficit) Equity:
Preferred Stock Value	0	0
Total stockholders' (deficit) equity	0	0
Series B Convertible Preferred Stock [Member]
Stockholders' (Deficit) Equity:
Preferred Stock Value	40	40
Total stockholders' (deficit) equity	40	40
Series C Convertible Preferred Stock [Member]
Stockholders' (Deficit) Equity:
Preferred Stock Value	0	0
Total stockholders' (deficit) equity	$ 0	$ 0

XML

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($)	6 Months Ended
	Jun. 30, 2019	Dec. 31, 2018
Amortization of Debt Issuance Costs and Discounts	$ 108,091
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	484,256,464	484,256,464
Common Stock, Shares, Outstanding	484,256,464	484,256,464
Series A 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	0	0
Preferred Stock, Shares Outstanding	0	0
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
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	0	0
Preferred Stock, Shares Outstanding	0	0

XML

CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS - USD ($)	3 Months Ended	6 Months Ended
	Jun. 30, 2019	Jun. 30, 2019
Expenses:
Professional fees	$ 51,258	$ 82,258
Directors fees	90,000	180,000
Compensation - related party	15,000	30,000
Non-cash stock compensation - related party	25,000	50,000
General and administrative	97,542	235,271
Total expenses	278,800	577,529
Loss from operations	(278,800)	(577,529)
Other income (expense):
Interest expense	(8,120)	(10,039)
Debt discount amortization	(28,438)	(47,909)
Change in the fair value of convertible debt	4,005	201,158
Loss on issuance of convertible debt	(42,143)	(318,263)
Total other expense, net	(74,696)	(175,053)
Loss before Provision for Income Taxes	(353,496)	(752,582)
Provision for Income Taxes	0	0
Net Loss	(353,496)	(752,582)
Undeclared Series B and Series C Preferred stock dividends	(7,978)	(15,869)
Net loss available to common stockholders	$ (361,474)	$ (768,451)
Net Loss Per Share - Basic and Diluted	$ 0.00	$ 0
Weighted Average Number of Shares Outstanding - Basic and Diluted	484,256,464	484,256,464

XML

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIT - USD ($)	Common Stock [Member]	Accumulated Deficit [Member]	Series A Convertible Preferred stock [Member]	Series B Convertible Preferred Stock [Member]	Series C Convertible Preferred Stock [Member]	Total
Balance at Dec. 31, 2018	$ 484,257	$ (416,427)	$ 0	$ 40	$ 0	$ 67,870
Balance (in shares) at Dec. 31, 2018	484,256,464		0	40,000	0
Net loss	$ 0	(399,086)	$ 0	$ 0	$ 0	(399,086)
Balance at Mar. 31, 2019	$ 484,257	(815,513)	$ 0	$ 40	$ 0	(331,216)
Balance (in shares) at Mar. 31, 2019	484,256,464		0	40,000	0
Balance at Dec. 31, 2018	$ 484,257	(416,427)	$ 0	$ 40	$ 0	67,870
Balance (in shares) at Dec. 31, 2018	484,256,464		0	40,000	0
Net loss						(752,582)
Balance at Jun. 30, 2019	$ 484,257	(1,169,009)	$ 0	$ 40	$ 0	(684,712)
Balance (in shares) at Jun. 30, 2019	484,256,464		0	40,000	0
Balance at Mar. 31, 2019	$ 484,257	(815,513)	$ 0	$ 40	$ 0	(331,216)
Balance (in shares) at Mar. 31, 2019	484,256,464		0	40,000	0
Net loss	$ 0	(353,496)	$ 0	$ 0	$ 0	(353,496)
Balance at Jun. 30, 2019	$ 484,257	$ (1,169,009)	$ 0	$ 40	$ 0	$ (684,712)
Balance (in shares) at Jun. 30, 2019	484,256,464		0	40,000	0

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CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS	6 Months Ended
	Jun. 30, 2019 USD ($)
Cash flow from operating activities:
Net Loss	$ (752,582)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation	1,651
Stock based compensation - related party	50,000
Debt discount amortization	47,909
Change in the fair value of convertible debt	(201,158)
Loss on issuance of convertible debt	318,263
Changes in operating assets and liabilities:
Prepaid expenses	2,695
Deposits	1,750
Accounts payable and accruals	234,506
Due to related parties	131,610
Net cash used in operating activities	(165,356)
Cash flows from financing activities:
Loan from a related party	6,800
Repayment of related party loan	(6,800)
Proceeds from convertible debt	150,000
Net cash provided by financing activities	150,000
Net decrease in cash	(15,356)
Cash at beginning of period	21,140
Cash at end of period	5,784
Cash paid during the period for:
Interest	5,276
Income taxes	$ 0

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ORGANIZATION AND DESCRIPTION OF BUSINESS

6 Months Ended

Jun. 30, 2019

ORGANIZATION AND DESCRIPTION OF BUSINESS

ORGANIZATION AND DESCRIPTION OF BUSINESS

NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS

On December 19, 2018, Pledge Petroleum Corp. (the “Company”) entered into a Share Exchange agreement with Renewable Technology Solutions, Inc. (“RTS”). Pursuant to the terms of the agreement, in exchange for 100% of the RTS shares, the Company will issue a stock certificate registered in the name of the RTS stockholder for 250,000,000 shares of its common stock. The transaction will be accounted for as a “reverse acquisition” and recapitalization, with RTS being the accounting acquirer. A reverse merger transaction with a public company is considered and accounted for as a capital transaction in substance; it is equivalent to the issuance of Pledge’s common stock for the net monetary assets of RTS, accompanied by a recapitalization. Accordingly, the accounting does not contemplate the recognition of unrecorded assets of the accounting acquiree, such as goodwill. Consolidated financial statements presented herein reflect the consolidated financial assets and liabilities of the Company at their historical costs, giving effect to the recapitalization, as if it had been RTS during the periods presented.

RTS was incorporated in the State of Tennessee on August 22, 2018. The Company was formed in order to conduct business in the sourcing and implementation of renewable energy technology.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Jun. 30, 2019

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation

The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and footnotes for the period from August 22, 2018 (date of inception) through December 31, 2018 included on the Company’s Form 10‑K. The results of the six months ended June 30, 2019 are not necessarily indicative of the results to be expected for the full year ending December 31, 2019.

In the opinion of management, all adjustments necessary to present fairly the financial position as of June 30, 2019 and the results of operations and cash flows presented herein have been included in the financial statements. All such adjustments are of a normal and recurring nature. Interim results are not necessarily indicative of results of operations for the full year.

Use of estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary RTS. All significant intercompany transactions and balances have been eliminated.

Fair Value of Financial Instruments

The Company follows paragraph 825‑10‑50‑10 of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) for disclosures about fair value of its financial instruments and paragraph 820‑10‑35‑37 of the FASB ASC (“Paragraph 820‑10‑35‑37”) to measure the fair value of its financial instruments. Paragraph 820‑10‑35‑37 establishes a framework for measuring fair value in U.S. GAAP, and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820‑10‑35‑37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three levels of fair value hierarchy defined by Paragraph 820‑10‑35‑37 are described below:

Level 1:Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.

Level 2: Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.

Level 3:   Pricing inputs that are generally unobservable inputs and not corroborated by market data.

The carrying amount of the Company’s financial assets and liabilities, such as cash, prepaid expenses and accrued expenses approximate their fair value because of the short maturity of those instruments. The Company’s notes payable approximates the fair value of such instruments as the notes bear interest rates that are consistent with current market rates.

The following table classifies the Company’s liabilities measured at fair value on a recurring basis into the fair value hierarchy as of:

June 30, 2019:

							Total Gains and
Description	Level 1		Level 2		Level 3		(Losses)
Derivative	$	—	$	—	$	273,105	$	201,158

Net Loss per Share

Net loss per common share is computed pursuant to section 260‑10‑45 of the ASC. Basic net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock and potentially outstanding shares of common stock during the period. The weighted average number of common shares outstanding and potentially outstanding common shares assumes that the Company incorporated as of the beginning of the first period presented. 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 three and six months ended June 30, 2019, all stock options, unvested restricted stock awards, warrants, 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.

Recently issued accounting pronouncements

On June 20, 2018, the FASB issued ASU 2018‑07, Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. ASU 2018‑07 is intended to reduce cost and complexity and to improve financial reporting for share-based payments to nonemployees (for example, service providers, external legal counsel, suppliers, etc.). Under the new standard, companies will no longer be required to value non-employee awards differently from employee awards. Meaning that companies will value all equity classified awards at their grant-date under ASC718 and forgo revaluing the award after this date. The guidance is effective for interim and annual periods beginning after December 15, 2018. The adoption of this standard has had no material impact.

In February 2016, the FASB issued ASU 2016‑02, Leases (Topic 842). The ASU requires that a lessee recognize the assets and liabilities that arise from operating leases. A lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. This new guidance will be effective for annual reporting periods beginning after December 15, 2018, including interim periods within those annual reporting periods, and early adoption is permitted. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The adoption of this standard has had no material impact.

The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

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GOING CONCERN

6 Months Ended

Jun. 30, 2019

GOING CONCERN

GOING CONCERN

NOTE 3 – GOING CONCERN

The Company’s condensed consolidated financial statements have been prepared on a going concern basis, which assumes that the Company will be able to realize its assets and discharge its liabilities and commitments in the normal course of business for the foreseeable future. The Company has just begun its operations and does not yet have operations or revenue to cover its operating expenses. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The ability to continue as a going concern is dependent upon generating profitable operations in the future and/or to obtain the necessary financing to meet the Company’s obligations and repay its liabilities arising from normal business operations when they come due. Management intends to finance operating costs over the next twelve months with debt and equity financing. While the Company believes that it will be successful in obtaining the necessary financing and generating revenue to fund its operations, meet regulatory requirements and achieve commercial goals, there are no assurances that such additional funding will be achieved and that it will succeed in its future operations. The financial statements of the Company do not include any adjustments that may result from the outcome of these uncertainties.

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CONVERTIBLE NOTE PAYABLE

6 Months Ended

Jun. 30, 2019

CONVERTIBLE NOTE PAYABLE

CONVERTIBLE NOTE PAYABLE

NOTE 4 – CONVERTIBLE NOTE PAYABLE

On January 22, 2019, the Company executed a converted promissory note with Redstart Holdings Corp. (“Redstart”) for $103,000. The note is unsecured, bears interest at 10% per annum and matures on January 22, 2020. The note is convertible, after 180 days, into shares of common stock at the rate of 61% (39% discount) of the average of the lowest three trading prices in the twenty trading days preceding the conversion. The Company bifurcated the conversion feature and accounted for it as a derivative liability. The Company recorded the derivative liability at its fair value of $379,120 based on the Black Scholes Merton pricing model and a corresponding debt discount of $103,000 to be amortized utilizing the interest method of accretion over the term of the note. As of June 30, 2019, the Company fair valued the derivative at $176,915. In addition, $45,150 of the debt discount has been amortized to interest expense.

On June 11, 2019, the Company executed a converted promissory note with Geneva Roth Remark Holdings, Inc. ("Geneva") for $53,000. The note is unsecured, bears interest at 10% per annum and matures on June 10, 2020. The note is convertible, after 180 days, into shares of common stock at the rate of 61% (39% discount) of the average of the lowest three trading prices in the twenty trading days preceding the conversion. The Company bifurcated the conversion feature and accounted for it as a derivative liability. The Company recorded the derivative liability at its fair value of $95,143 based on the Black Scholes Merton pricing model and a corresponding debt discount of $53,000 to be amortized utilizing the interest method of accretion over the term of the note. As of June 30, 2019, the Company fair valued the derivative at $96,190. In addition, $2,759 of the debt discount has been amortized to interest expense.

A summary of the activity of the derivative liability for the notes above is as follows:

Balance at December 31, 2018	$	—
Increase to derivative due to new issuances		474,263
Derivative gain due to mark to market adjustment		(201,158)
Balance at June 30, 2019	$	273,105

A summary of quantitative information about significant unobservable inputs (Level 3 inputs) used in measuring the Company’s derivative liability that are categorized within Level 3 of the fair value hierarchy for the six months ended June 30, 2019 is as follows:

Inputs	June 30, 2019		Initial Valuation
Stock price	$	0.045	$	0.0406 - 0.045
Conversion price	$	0.0221	$	0.0105 - 0.0226
Volatility (annual)		286.6% - 317.49%		292% - 318.13%
Risk-free rate		1.92% - 2.09%		2.05 - 2.59%
Years to maturity		.56 - 0.95		1

The development and determination of the unobservable inputs for Level 3 fair value measurements and fair value calculations are the responsibility of the Company’s management

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RELATED PARTY TRANSACTIONS

6 Months Ended

Jun. 30, 2019

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS

NOTE 5 – RELATED PARTY TRANSACTIONS

On May 2, 2018, the Company issued to each of its three directors, 10,000,000 shares of restricted common stock, vesting as to 1/3 of the grant immediately, 1/3 of the grant on the one-year anniversary of the grant date and 1/3 of the grant on the two-year anniversary of the grant date. The value of the stock has been debited to prepaid stock compensation and will be amortized over the vesting period. As of June 30, 2019, and December 31, 2018, there is $83,333 and $133,333 of prepaid stock compensation, respectively.

The restricted stock granted and exercisable at June 30, 2019 is as follows:

	Restricted Stock Granted			Restricted Stock Vested
		Weighted			Weighted
	Number	average exercise		Number	average exercise
Grant date price	granted	price		vested	price
$0.01	30,000,000	$	0.01	20,000,000	$	0.01

The Company recorded an expense of $25,000 and $50,000 for the three and six months ended June 30, 2019, respectively, related to the restricted stock granted to the directors.

As of June 30, 2019 and December 31, 2018, $137,500 and $5,890, respectively, is owed to the three directors of the Company for director fees and various advances for services provided in the normal course of business. All amounts due are unsecured, non-interest bearing and due on demand.

On December 31, 2018, the Company executed a promissory note with John Huemoeller, Chairman, for $5,000. The promissory note is unsecured, bears interest at 5% and is due on or before December 31, 2019.

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PREFERRED STOCK

6 Months Ended

Jun. 30, 2019

PREFERRED STOCK

PREFERRED STOCK

NOTE 6 – PREFERRED STOCK

Series A‑1 Preferred

The Company has designated 5,000,000 preferred shares as Series A‑1 Convertible Preferred Stock (“Series A‑1 Shares”). Each share of Series A‑1 is convertible into ten shares of common stock and has voting rights equal to the number of shares of common stock that holders can convert into. The Series A‑1 Shares are non-redeemable by the Company and are entitled to a liquidation preference of $0.08 per share. As of June 30, 2019, there are no shares of Series A‑1 Preferred outstanding.

Series B Preferred

The Company has designated 500,000 preferred shares as Series B Convertible Preferred Stock (“Series B Shares”), with 40,000 Series B Shares issued and outstanding as of June 30, 2019, which are convertible into 4,000,000 shares of common stock.

The rights, privileges and preferences of the Series B Shares are summarized as follows:

Conversion

Each share of the Series B Shares is convertible at any time prior to the issuance of a redemption notice by the Company into such number of shares of Common Stock by dividing the Stated value ($10) of the Series B Shares by $0.10 and is subject to adjustment for dividends or distributions made in common stock, the issue of securities convertible into common stock, stock splits, reverse stock splits, or reclassifications of common stock.

Company Redemption

The Company has the right, at any time after the date the Series B Shares have been issued, to redeem all or a portion of any Holder’s Series B Shares at a price per Series B Share equal to the issue price per Series B Share multiplied by 120%.

Voting Rights

Each holder of Series B Shares is entitled to vote on all matters submitted to a vote of the stockholders of the Company and is entitled to votes equal to the number of shares of Common Stock into which Series B Shares could be converted, and the holders of shares of Series B Shares and Common Stock will vote together as a single class on all matters submitted to the stockholders of the Company.

Dividends

The holders of the Series B Shares are entitled to receive cumulative dividends at the rate of eight percent per annum of the issue price per share, accrued daily and payable annually in arrears on December 31st of each year. Such dividends accrue on any given share from the day of original issuance of such share. Such dividends are cumulative, whether or not declared by the Board of Directors, but are non-compounding. Any dividend payable on a dividend payment date may be paid, at the option of the Company, either (i) in cash or (ii) in shares of common stock at an issue price of $0.10 per common share. In the event that pursuant to applicable law or contract the Company is prohibited or restricted from paying in cash the full dividends to which the holders of the Series B Shares are entitled, the cash amount available pursuant to applicable law or contract will be distributed among the holders of the Series B Shares ratably in proportion to the full amounts to which they would otherwise be entitled and any remaining amount due to holders of the Series B Shares will be payable in cash.

Liquidation Preference

In the event of any liquidation, dissolution or winding up of the Company, either voluntary or involuntary, the holders of the Series B Shares are entitled to receive, prior and in preference to any distribution of any assets of the Company to the holders of any other preferred stock of the Company and subordinate to any distribution to the Series A‑1 Shares, and prior and in preference to any distribution of any assets of the Company to the holders of the Common Stock, the amount of 120% of the issue price per share. In addition, the Series B holder has agreed to vote to subordinate the series B Preferred stock liquidation preferences to the Series C Preferred stock preferences.

The Company has undeclared dividends on the Series B Preferred stock amounting to $201,096 as of June 30, 2019. 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 takes into account these undeclared dividends.

Series C Preferred

The Company has designated 4,500,000 preferred shares as Series C Convertible Preferred Stock (“Series C Shares”). Each share of Series C is convertible into 120,000,000 shares of common stock and has voting rights equal to the number of shares of common stock that holders can convert into. The Series C Shares are non-redeemable by the Company and are entitled to a liquidation preference. As of June 30, 2019, there are no shares of Series C Preferred outstanding.

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STOCK OPTIONS

6 Months Ended

Jun. 30, 2019

STOCK OPTIONS

STOCK OPTIONS

NOTE 7 – STOCK OPTIONS

The Company’s Board of Directors approved the Company’s 2008 Stock Option Plan (the “Stock Plan”) for the issuance of up to 5,000,000 shares of common stock to be granted through incentive stock options, nonqualified stock options, stock appreciation rights, dividend equivalent rights, restricted stock, restricted stock units and other stock-based awards to officers, other employees, directors and consultants of the Company and its subsidiaries. After the reverse stock split in August 2012, a total of 100,000 shares were available for grant. Subsequent to the reverse split the Board of Directors approved an increase in the number of awards available for grant to 2,100,000 shares. The exercise price of stock options under the Stock Plan is determined by the Board of Directors, and may be equal to or greater than the fair market value of the Company’s common stock on the date the option is granted. Options become exercisable over various periods from the date of grant, and generally expire ten years after the grant date.

At June 30, 2019, there were 54,224 plan options outstanding, under the Stock Option Plan.

The vesting provisions for these stock options are determined by the board of directors at the time of grant, there are no unvested options outstanding as of June 30, 2019.

In the event of the employees’ termination, the Company will cease to recognize compensation expense.

A summary of all of our option activity during the period ended June 30, 2019 is as follows:

				Weighted
				average
		Exercise price		exercise
	No. of shares	per share		price
From August 22, 2018	—	$	—	$	—
Granted - non-plan options	—		—		—
Forfeited/cancelled	—		—		—
Exercised	—		—		—
Effects of recapitalization from reverse acquisition	57,704	$	0.65 to $13.50		3.02
Outstanding December 31, 2018	57,704	$	0.65 to $13.50	$	3.02
Granted - non-plan options	—		—		—
Forfeited/cancelled	(3,480)		—		—
Exercised	—		—		—
Outstanding June 30, 2019	54,224	$	0.65 to $12.50	$	2.77

The options outstanding and exercisable at June 30, 2019 are as follows:

		Options outstanding			Options exercisable
			Weighted	Weighted		Weighted
			average remaining	average exercise		average exercise
Exercise price		No. of shares	years	price	No. of shares	price
$	12.50	2,000	1.28		2,000
$	8.50	500	2.00		500
$	5.00	14,800	2.29		14,800
$	0.65	36,924	3.75		36,924
		54,224	3.25	2.35	54,224	$	2.35

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WARRANTS

6 Months Ended

Jun. 30, 2019

Warrant [Member]

WARRANTS

NOTE 8 – WARRANTS

The warrants outstanding and exercisable at June 30, 2019 are as follows:

		Warrants outstanding				Warrants exercisable
			Weighted	Weighted			Weighted
			average remaining	average exercise			average exercise
Exercise price		No. of shares	years	price		No. of shares	price
$	0.25	1,508,333	0.09			1,508,333
$	0.15	577,499	0.10			577,499
$	0.25	968,166	0.10			968,166
$	0.25	633,333	0.15			633,333
		3,687,331	0.11	$	0.14	3,687,331	$	0.14

No warrants were issued or exercised from August 22, 2018 through June 30, 2019. A total of 2,652,167 warrants have expired during the period from August 22, 2018 through June 30, 2019.

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COMMITMENTS AND CONTINGENCIES

6 Months Ended

Jun. 30, 2019

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

NOTE 9 – COMMITMENTS AND CONTINGENCIES

During the normal course of business, the Company may be exposed to litigation. When the Company becomes aware of potential litigation, it evaluates the merits of the case in accordance with FASB ASC 450‑20‑50, Contingencies. The Company evaluates its exposure to the matter, possible legal or settlement strategies and the likelihood of an unfavorable outcome. If the Company determines that an unfavorable outcome is probable and can be reasonably estimated, it establishes the necessary accruals. As of June 30, 2019, the Company is not aware of any contingent liabilities that should be reflected in the unaudited condensed consolidated financial statements.

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SUBSEQUENT EVENTS

6 Months Ended

Jun. 30, 2019

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS

NOTE 10 – SUBSEQUENT EVENTS

Management has evaluated subsequent events pursuant to the requirements of ASC Topic 855, from the balance sheet date through the date the consolidated financial statements were available to be issued and has determined that there are no material subsequent events that require disclosure in the unaudited condensed consolidated financial statements.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

6 Months Ended

Jun. 30, 2019

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation

Basis of presentation

The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and footnotes for the period from August 22, 2018 (date of inception) through December 31, 2018 included on the Company’s Form 10‑K. The results of the six months ended June 30, 2019 are not necessarily indicative of the results to be expected for the full year ending December 31, 2019.

In the opinion of management, all adjustments necessary to present fairly the financial position as of June 30, 2019 and the results of operations and cash flows presented herein have been included in the financial statements. All such adjustments are of a normal and recurring nature. Interim results are not necessarily indicative of results of operations for the full year.

Use of estimates

Use of estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Principles of Consolidation

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary RTS. All significant intercompany transactions and balances have been eliminated.

Fair Value of Financial Instruments

Fair Value of Financial Instruments

The Company follows paragraph 825‑10‑50‑10 of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) for disclosures about fair value of its financial instruments and paragraph 820‑10‑35‑37 of the FASB ASC (“Paragraph 820‑10‑35‑37”) to measure the fair value of its financial instruments. Paragraph 820‑10‑35‑37 establishes a framework for measuring fair value in U.S. GAAP, and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820‑10‑35‑37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three levels of fair value hierarchy defined by Paragraph 820‑10‑35‑37 are described below:

Level 1:Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.

Level 2: Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.

Level 3:   Pricing inputs that are generally unobservable inputs and not corroborated by market data.

The carrying amount of the Company’s financial assets and liabilities, such as cash, prepaid expenses and accrued expenses approximate their fair value because of the short maturity of those instruments. The Company’s notes payable approximates the fair value of such instruments as the notes bear interest rates that are consistent with current market rates.

The following table classifies the Company’s liabilities measured at fair value on a recurring basis into the fair value hierarchy as of:

June 30, 2019:

							Total Gains and
Description	Level 1		Level 2		Level 3		(Losses)
Derivative	$	—	$	—	$	273,105	$	201,158

Net Loss per Share

Net Loss per Share

Net loss per common share is computed pursuant to section 260‑10‑45 of the ASC. Basic net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock and potentially outstanding shares of common stock during the period. The weighted average number of common shares outstanding and potentially outstanding common shares assumes that the Company incorporated as of the beginning of the first period presented. 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 three and six months ended June 30, 2019, all stock options, unvested restricted stock awards, warrants, 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.

Recently issued accounting pronouncements

Recently issued accounting pronouncements

On June 20, 2018, the FASB issued ASU 2018‑07, Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. ASU 2018‑07 is intended to reduce cost and complexity and to improve financial reporting for share-based payments to nonemployees (for example, service providers, external legal counsel, suppliers, etc.). Under the new standard, companies will no longer be required to value non-employee awards differently from employee awards. Meaning that companies will value all equity classified awards at their grant-date under ASC718 and forgo revaluing the award after this date. The guidance is effective for interim and annual periods beginning after December 15, 2018. The adoption of this standard has had no material impact.

In February 2016, the FASB issued ASU 2016‑02, Leases (Topic 842). The ASU requires that a lessee recognize the assets and liabilities that arise from operating leases. A lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. This new guidance will be effective for annual reporting periods beginning after December 15, 2018, including interim periods within those annual reporting periods, and early adoption is permitted. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The adoption of this standard has had no material impact.

The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

6 Months Ended

Jun. 30, 2019

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Schedule of Company's liabilities measured at fair value on a recurring basis

The following table classifies the Company’s liabilities measured at fair value on a recurring basis into the fair value hierarchy as of:

June 30, 2019:

							Total Gains and
Description	Level 1		Level 2		Level 3		(Losses)
Derivative	$	—	$	—	$	273,105	$	201,158

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CONVERTIBLE NOTE PAYABLE (Tables)

6 Months Ended

Jun. 30, 2019

CONVERTIBLE NOTE PAYABLE

Schedule of derivative liability

A summary of the activity of the derivative liability for the notes above is as follows:

Balance at December 31, 2018	$	—
Increase to derivative due to new issuances		474,263
Derivative gain due to mark to market adjustment		(201,158)
Balance at June 30, 2019	$	273,105

Schedule quantitative information about significant unobservable inputs (Level 3 inputs) used in measuring the Company's derivative liability

A summary of quantitative information about significant unobservable inputs (Level 3 inputs) used in measuring the Company’s derivative liability that are categorized within Level 3 of the fair value hierarchy for the six months ended June 30, 2019 is as follows:

Inputs	June 30, 2019		Initial Valuation
Stock price	$	0.045	$	0.0406 - 0.045
Conversion price	$	0.0221	$	0.0105 - 0.0226
Volatility (annual)		286.6% - 317.49%		292% - 318.13%
Risk-free rate		1.92% - 2.09%		2.05 - 2.59%
Years to maturity		.56 - 0.95		1

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RELATED PARTY TRANSACTIONS (Tables)

6 Months Ended

Jun. 30, 2019

RELATED PARTY TRANSACTIONS

Schedule of restricted stock granted and exercisable

The restricted stock granted and exercisable at June 30, 2019 is as follows:

	Restricted Stock Granted			Restricted Stock Vested
		Weighted			Weighted
	Number	average exercise		Number	average exercise
Grant date price	granted	price		vested	price
$0.01	30,000,000	$	0.01	20,000,000	$	0.01

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STOCK OPTIONS (Tables)

6 Months Ended

Jun. 30, 2019

WARRANTS

Schedule of option activity

A summary of all of our option activity during the period ended June 30, 2019 is as follows:

				Weighted
				average
		Exercise price		exercise
	No. of shares	per share		price
From August 22, 2018	—	$	—	$	—
Granted - non-plan options	—		—		—
Forfeited/cancelled	—		—		—
Exercised	—		—		—
Effects of recapitalization from reverse acquisition	57,704	$	0.65 to $13.50		3.02
Outstanding December 31, 2018	57,704	$	0.65 to $13.50	$	3.02
Granted - non-plan options	—		—		—
Forfeited/cancelled	(3,480)		—		—
Exercised	—		—		—
Outstanding June 30, 2019	54,224	$	0.65 to $12.50	$	2.77

Schedule of options outstanding and exercisable

The options outstanding and exercisable at June 30, 2019 are as follows:

		Options outstanding			Options exercisable
			Weighted	Weighted		Weighted
			average remaining	average exercise		average exercise
Exercise price		No. of shares	years	price	No. of shares	price
$	12.50	2,000	1.28		2,000
$	8.50	500	2.00		500
$	5.00	14,800	2.29		14,800
$	0.65	36,924	3.75		36,924
		54,224	3.25	2.35	54,224	$	2.35

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WARRANTS (Tables)

6 Months Ended

Jun. 30, 2019

WARRANTS

Schedule of warrants outstanding and exercisable

The warrants outstanding and exercisable at June 30, 2019 are as follows:

		Warrants outstanding				Warrants exercisable
			Weighted	Weighted			Weighted
			average remaining	average exercise			average exercise
Exercise price		No. of shares	years	price		No. of shares	price
$	0.25	1,508,333	0.09			1,508,333
$	0.15	577,499	0.10			577,499
$	0.25	968,166	0.10			968,166
$	0.25	633,333	0.15			633,333
		3,687,331	0.11	$	0.14	3,687,331	$	0.14

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ORGANIZATION AND DESCRIPTION OF BUSINESS (Details) - Renewable Technology Solutions Inc [Member]	1 Months Ended
	Dec. 19, 2018 shares
Organization and Description of Business [Line Items]
Business Acquisition, Percentage of Voting Interests Acquired	100.00%
Number of Shares to be Issued Pursuant to Reverse Acquisition	250,000,000

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($)	Jun. 30, 2019	Dec. 31, 2018
Accounting Policies and Estimates [Line Items]
Derivative	$ 273,105	$ 0
Derivative [Member] | Fair Value, Measurements, Recurring [Member]
Accounting Policies and Estimates [Line Items]
Derivative	201,158
Derivative [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member]
Accounting Policies and Estimates [Line Items]
Derivative	0
Derivative [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member]
Accounting Policies and Estimates [Line Items]
Derivative	0
Derivative [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member]
Accounting Policies and Estimates [Line Items]
Derivative	$ 273,105

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CONVERTIBLE NOTE PAYABLE - Derivative liability (Details) - USD ($)	3 Months Ended	6 Months Ended
	Jun. 30, 2019	Jun. 30, 2019
CONVERTIBLE NOTE PAYABLE
Balance		$ 0
Increase to derivative due to new issuances		474,263
Derivative gain due to mark to market adjustment	$ (4,005)	(201,158)
Balance	$ 273,105	$ 273,105

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CONVERTIBLE NOTE PAYABLE - Information about inputs used in measuring derivative liability (Details) - $ / shares	6 Months Ended	12 Months Ended
	Jun. 30, 2019	Dec. 31, 2018
Stock price	$ 0.045
Conversion price	$ 0.0221
Years to maturity		1 year
Minimum [Member]
Stock price		$ 0.0406
Conversion price		$ 0.0105
Volatility (annual)	286.60%	292.00%
Risk-free rate	1.92%	2.05%
Years to maturity	6 months 22 days
Maximum [Member]
Stock price		$ 0.045
Conversion price		$ 0.0226
Volatility (annual)	317.49%	318.13%
Risk-free rate	2.09%	2.59%
Years to maturity	11 months 12 days

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CONVERTIBLE NOTE PAYABLE - Additional Information (Details) - USD ($)		1 Months Ended	6 Months Ended
	Jun. 11, 2019	Jan. 22, 2019	Jun. 30, 2019	Dec. 31, 2018
Debt Instrument, Interest Rate, Stated Percentage				5.00%
Derivative, Fair Value, Net			$ 273,105	$ 0
Amortization of Debt Discount (Premium)			47,909
Redstart Holdings Corp [Member]
Derivative Liability		$ 379,120
Debt Instrument, Unamortized Discount		103,000
Derivative, Fair Value, Net			176,915
Amortization of Debt Discount (Premium)			45,150
Geneva Roth Remark Holdings, Inc [Member]
Derivative Liability	$ 95,143
Debt Instrument, Unamortized Discount	53,000
Derivative, Fair Value, Net			96,190
Amortization of Debt Discount (Premium)			$ 2,759
Unsecured Debt [Member] | Redstart Holdings Corp [Member]
Debt Instrument, Face Amount		$ 103,000
Debt Instrument, Interest Rate, Stated Percentage		10.00%
Debt Instrument, Maturity Date		Jan. 22, 2020
Debt Conversion, Converted Instrument, Rate		61.00%
Debt Instrument, Convertible, Terms of Conversion Feature		(39% discount) of the average of the lowest three trading prices in the twenty trading days preceding the conversion.
Unsecured Debt [Member] | Geneva Roth Remark Holdings, Inc [Member]
Debt Instrument, Face Amount	$ 53,000
Debt Instrument, Interest Rate, Stated Percentage	10.00%
Debt Instrument, Maturity Date	Jun. 10, 2020
Debt Conversion, Converted Instrument, Rate	61.00%
Debt Instrument, Convertible, Terms of Conversion Feature	(39% discount) of the average of the lowest three trading prices in the twenty trading days preceding the conversion.

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RELATED PARTY TRANSACTIONS (Details) - Grant Date Price [Member] - Restricted Stock [Member]	6 Months Ended
	Jun. 30, 2019 $ / shares shares
Restricted Stock Granted, Number granted | shares	30,000,000
Restricted Stock Granted, Weighted average exercise price | $ / shares	$ 0.01
Restricted Stock Vested, Number vested | shares	20,000,000
Restricted Stock Vested, Weighted average exercise price | $ / shares	$ 0.01

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RELATED PARTY TRANSACTIONS - Additional Information (Details) - USD ($)	1 Months Ended	3 Months Ended	6 Months Ended
	May 02, 2018	Jun. 30, 2019	Jun. 30, 2019	Dec. 31, 2018
Related Party Transaction [Line Items]
Share-based Compensation		$ 25,000	$ 50,000
Due to Related Parties, Current		137,500	137,500	$ 5,890
Debt Instrument, Interest Rate, Stated Percentage				5.00%
Employee Prepaid Stock Compensation		83,333	83,333	$ 133,333
Loan Payable To Related Party				$ 5,000
Vesting Period One [Member]
Related Party Transaction [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period	10,000,000
Vesting Period Two [Member]
Related Party Transaction [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period	10,000,000
Vesting Period Three [Member]
Related Party Transaction [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period	10,000,000
Restricted Stock [Member]
Related Party Transaction [Line Items]
Share-based Compensation		$ 25,000	$ 50,000

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PREFERRED STOCK - Additional Information (Details) - USD ($)	3 Months Ended
	Jun. 30, 2019	Dec. 31, 2018
Series A-1 Preferred Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Preferred Stock, Shares Outstanding	0
Preferred Stock Shares Designated	5,000,000
Preferred Stock, Liquidation Preference Per Share	$ 0.08
Series B Convertible Preferred Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Conversion of Stock, Shares Issued	4,000,000
Preferred Stock, Shares Issued	40,000	40,000
Preferred Stock, Shares Outstanding	40,000	40,000
Convertible Preferred Stock, Terms of Conversion	Each share of the Series B Shares is convertible at any time prior to the issuance of a redemption notice by the Company into such number of shares of Common Stock by dividing the Stated value ($10) of the Series B Shares by $0.10 and is subject to adjustment for dividends or distributions made in common stock, the issue of securities convertible into common stock, stock splits, reverse stock splits, or reclassifications of common stock.
Preferred Stock, Dividend Payment Terms	Any dividend payable on a dividend payment date may be paid, at the option of the Company, either (i) in cash or (ii) in shares of common stock at an issue price of $0.10 per common share.
Undeclared Dividends	$ 201,096
Preferred Stock Shares Designated	500,000	500,000
Series C Convertible Preferred Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Conversion of Stock, Shares Issued	120,000,000
Preferred Stock, Shares Issued	0	0
Preferred Stock, Shares Outstanding	0	0
Preferred Stock Shares Designated	4,500,000	4,500,000

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STOCK OPTIONS - Option activity (Details) - Employee Stock Option [Member] - $ / shares	4 Months Ended	6 Months Ended
	Dec. 31, 2018	Jun. 30, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares option activity, Outstanding Balance (in shares)		57,704
Shares option activity, Granted (in shares)	0	0
Shares option activity, Forfeited/cancelled (in shares)	0	(3,480)
Shares option activity, Exercised (in shares)	0	0
Effects of recapitalization from reverse acquisition (in shares)	57,704
Shares option activity, Outstanding Balance (in shares)	57,704	54,224
Exercise price per share, Outstanding Balance (in dollars per share)		$ 3.02
Exercise price per share, Granted (in dollars per share)	$ 0	0
Exercise price per share, Forfeited/cancelled (in dollars per share)	0	0
Exercise price per share, Exercised (in dollars per share)	0	0
Exercise price per share, Outstanding Ending (in dollars per share)	3.02	2.35
Weighted Average Exercise Price, Effects of recapitalization from reverse acquisition (in dollars per share)	$ 3.02	2.77
Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Effects of recapitalization from reverse acquisition (in shares)	13.50
Exercise price per share, Outstanding Balance (in dollars per share)		13.50
Exercise price per share, Outstanding Ending (in dollars per share)	$ 13.50	12.50
Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercise price per share, Outstanding Balance (in dollars per share)		0.65
Exercise price per share, Outstanding Ending (in dollars per share)	0.65	$ 0.65
Exercise Price per share, Effects of recapitalization from reverse acquisition (in dollars per share)	$ 0.65

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STOCK OPTIONS - Options outstanding and exercisable (Details) - Employee Stock Option [Member] - $ / shares	3 Months Ended
	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Aug. 22, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options Outstanding, Exercise Price	$ 2.35		$ 3.02	$ 0
Options Outstanding, Number Outstanding (in shares)	54,224		57,704	0
Options Outstanding, Weighted Average Remaining Contractual life in years	3 years 3 months
Options Exercisable, Number Exercisable (in shares)	54,224
Options Exercisable, Weighted Average Exercise Price		$ 2.35
Exercise Price Range One [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options Outstanding, Exercise Price	$ 12.50
Options Outstanding, Number Outstanding (in shares)	2,000
Options Outstanding, Weighted Average Remaining Contractual life in years	1 year 3 months 11 days
Options Exercisable, Number Exercisable (in shares)	2,000
Exercise Price Range Two [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options Outstanding, Exercise Price		$ 8.50
Options Outstanding, Number Outstanding (in shares)	500
Options Outstanding, Weighted Average Remaining Contractual life in years	2 years
Options Exercisable, Number Exercisable (in shares)	500
Exercise Price Range Three [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options Outstanding, Exercise Price	$ 5.00
Options Outstanding, Number Outstanding (in shares)	14,800
Options Outstanding, Weighted Average Remaining Contractual life in years	2 years 3 months 15 days
Options Exercisable, Number Exercisable (in shares)	14,800
Exercise Price Range Four [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options Outstanding, Exercise Price	$ 0.65
Options Outstanding, Number Outstanding (in shares)	36,924
Options Outstanding, Weighted Average Remaining Contractual life in years	3 years 9 months
Options Exercisable, Number Exercisable (in shares)	36,924

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STOCK OPTIONS - Additional Information (Details) - Employee Stock Option [Member] - shares	3 Months Ended
	Jun. 30, 2019	Dec. 31, 2018	Aug. 22, 2018
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized	5,000,000
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant	100,000
Share-based Compensation Arrangement by Share-based Payment Award, Number of Additional Shares Authorized	2,100,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number	54,224	57,704	0

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WARRANTS (Details)	3 Months Ended
	Jun. 30, 2019 $ / shares shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Warrants Exercisable, Weighted Average Exercise Price | $ / shares	$ 0.14
Exercise Price Range One [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Warrants Outstanding, Weighted Average Remaining Contractual life in years	1 month 2 days
Exercise Price Range Two [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Warrants Outstanding, Weighted Average Remaining Contractual life in years	1 month 6 days
Exercise Price Range Three [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Warrants Outstanding, Weighted Average Remaining Contractual life in years	1 month 6 days
Exercise Price Range Four [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Warrants Outstanding, Weighted Average Remaining Contractual life in years	1 month 24 days
Warrant [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Warrants Outstanding, Number Outstanding	3,687,331
Warrants Outstanding, Weighted Average Remaining Contractual life in years	1 month 10 days
Warrants Exercisable, Number Exercisable	3,687,331
Warrant [Member] | Exercise Price Range One [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 Exercisable, Number Exercisable	1,508,333
Warrant [Member] | Exercise Price Range Two [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 Exercisable, Number Exercisable	577,499
Warrant [Member] | Exercise Price Range Three [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 Exercisable, Number Exercisable	968,166
Warrant [Member] | 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	633,333
Warrants Exercisable, Number Exercisable	633,333

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WARRANTS - Additional Information (Details)	10 Months Ended
	Jun. 30, 2019 shares
Warrant [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Shares Expired	2,652,167