UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


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



		For the quarterly period ended ~~September 30, 2017~~

	March 31, 2022
¨
or

	☐	TRANSITION REPORT ~~UNDER~~PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



		For the transition period from ~~__________________~~___________ to ~~__________________~~

~~Commission file number: 000-54887~~ ___________

Commission File Number 000-54887

Bright Mountain Media, Inc.

(Exact ~~name~~Name of ~~registrant~~Registrant as ~~specified~~Specified in its ~~charter)~~Charter)

Florida

27-2977890

~~Florida~~

~~27-2977890~~

(State or ~~other jurisdiction~~Other Jurisdiction of ~~incorporation~~

Incorporation or ~~organization)~~Organization

(I.R.S. Employer

Identification No.)


6400 Congress Avenue, Suite 2050, Boca Raton ~~Florida~~ , FL		33487
(Address of ~~principal executive offices)~~ Principal Executive Offices	(	Zip ~~Code)~~ Code

561-998-2440

Registrant’s Telephone Number, Including Area Code

Not applicable

Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
~~561-998-2440~~ None
~~(Registrant's telephone number, including area code)~~

~~not applicable~~

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

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

Indicate by check mark whether the registrant has submitted electronically ~~and posted on its corporate Website, if any,~~ every Interactive Data File required to be submitted ~~and posted~~ pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit ~~and post~~ such files). þYes ¨☐ 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 ☐	o	Accelerated filer	o ☐
	Non-accelerated filer ☒	o	Smaller reporting company	þ ☒
		Emerging growth company	þ ☒

If an emerging growth company, indicate by ~~checkmark~~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)o. Yes þ☐ No ☒

APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

As of ~~November 20, 2017 the issuer had 46,168,864~~June 24, 2022 there were 149,159,461 shares of ~~its common stock~~the issuer’s shares outstanding.

TABLE OF CONTENTS

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION

~~Various statements in this~~This report ~~contain or may contain~~includes forward-looking statements that ~~are subject~~relate to future events or our future financial performance and involve known and unknown risks, uncertainties and other factors ~~which~~that may cause our actual results, levels of activity, performance or achievements to bediffer materially ~~different~~ from any future results, levels of activity, performance or achievements expressed or implied by ~~such~~these forward-looking statements. ~~These~~Words such as, but not limited to, “believe,” “expect,” “anticipate,” “estimate,” “intend,” “plan,” “targets,” “likely,” “aim,” “will,” “would,” “could,” and similar expressions or phrases identify forward-looking statements. We have based these forward-looking statements ~~were based~~largely on ~~various factors~~our current expectations and ~~were derived from utilizing numerous assumptions~~future events and ~~other factors~~financial trends that ~~could cause~~we believe may affect our ~~actual~~financial condition, results ~~to differ materially from those in the forward-looking statements. These factors~~of operation, business strategy and financial needs. Forward-looking statements include, but are not limited ~~to:~~to, statements about risks associated with:


●	·	~~our history of losses and~~ our ability to ~~raise additional capital and continue as a going concern;~~
	·	~~our ability to successfully integrate the operations of the Black Helmet Apparel business;~~
	·	~~our ability to successfully integrate the Daily Engage Media acquisition and launch~~fully develop the Bright Mountain Media Ad ~~Network;~~ Exchange Network and services platform;
	· ●	~~a failure to successfully transition to primarily advertising based revenue model;~~ the continued appeal of internet advertising;
	· ●	our ability to manage and expand our relationships with publishers;
	●	our dependence on revenues from a limited number of customers;
	●	the impact of seasonal fluctuations on our revenues;
	· ●	~~once established, our failure to detect advertising fraud;~~
	·	~~our dependence on our relationships with Amazon and PayPal;~~
	·	~~our dependence on a limited number of vendors;~~
	·	~~our dependence on our relationship with Google AdSense;~~
	·	acquisitions of new businesses and our ability to integrate those businesses into our operations;
	· ●	online security breaches;
	· ●	failure to effectively promote our ~~brand;~~ brand and attract advertisers;
	· ●	our ability to protect our content;
	· ●	our ability to protect our intellectual property ~~rights and our proprietary content;~~ rights;
	· ●	the success of our technology development efforts;
	· ●	additional competition resulting from our business expansion strategy;


	· ●	our dependence on third party service providers;
	●	our ability to detect advertising fraud;
	●	liability related to content which appears on our websites;
	· ●	regulatory ~~risks;~~ risks and compliance with privacy laws;
	· ●	dependence on executive officers and certain key employees and consultants;
	· ●	our ability to hire qualified personnel;
	· ●	~~third party content;~~
	·	possible problems with our network infrastructure;
	· ●	ongoing material weaknesses in our disclosure controls and internal control over financial reporting;
	●	the ~~historic~~impact on available working capital resulting from the payment of cash dividends to our affiliates;
	●	dilution to existing shareholders upon the conversion of outstanding preferred stock and convertible notes and/or the exercise of outstanding options and warrants, including warrants with cashless exercise rights;
	●	the illiquid nature of our common stock;
	· ●	risks associated with securities litigation; and
	· ●	~~material weaknesses in our internal control over financial reporting;~~
	·	~~the lack of cash dividends on our common stock;~~
	·	provisions of our charter and Florida law which may have anti-takeover ~~effects;~~
	·	~~control of our company by our management; and~~
	·	~~the dilutive effect of conversion of our 10% Series A and Series E convertible preferred stock and/or the payment of stock and cash dividends on those shares to our common shareholders.~~ effects

Most of these factors are difficult to predict accurately and are generally beyond our control. You should consider the areas of risk described in connection with any forward-looking statements that may be made herein. Readers are cautioned not to place undue reliance on these forward-looking statements and readers should carefully review this report, including the Part II, Item 2, our Annual Report on Form 10-K for the year ended December 31, ~~2016~~2021, as filed with the Securities and Exchange Commission on June 13, 2022 and our other filings with the Securities and Exchange Commission in their entirety. Except for our ongoing obligations to disclose material information under the Federal securities laws, we undertake no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events. These forward-looking statements speak only as of the date of this report, and you should not rely on these statements without also considering the risks and uncertainties associated with these statements and our business.

OTHER PERTINENT INFORMATION

Unless specifically set forth to the contrary, when used in this report the terms “Bright Mountain”, the “Company,” “we”, “us”, “our” and similar terms refer to Bright Mountain Media, Inc., a Florida corporation, and its ~~subsidiaries, and "Daily Engage Media" refers to Daily Engage Media Group LLC, a New Jersey limited liability company and wholly owned subsidiary of the Company.~~subsidiaries. In addition, when used in this report, ~~“third~~“first quarter of ~~2017”~~2022” refers to the three months ended ~~September 30, 2017, "third~~March 31, 2022, “first quarter of ~~2016"~~2021” refers to the three months ended ~~September 30, 2016, “2017” refers to the year ending December~~March 31, ~~2017~~2021, and ~~“2016”~~“2021” refers to the year ended December 31, ~~2016.~~

~~Unless specifically set forth to the contrary, the~~2021. The information which appears on our website at www.brightmountainmedia.com is not part of this ~~report.~~report.

PART 1 -– FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

~~FINANCIAL STATEMENTS.~~

BRIGHT MOUNTAIN MEDIA, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

September 30

December 31,

2017

2016

(unaudited)

ASSETS

Current assets

Cash

$
123,292

$
162,795

Accounts Receivable, net

223,396

157,013

Prepaid Expenses and Other Current Assets

71,727

132,950

Inventories

984,522

1,127,072

Total current assets

1,402,937

1,579,830

Fixed Assets, net

94,382

99,001

Intangible Assets, net

1,231,776

967,114

Goodwill

502,823

—

Tradenames

300,000

150,000

Other Assets

49,497

184,400

Total Assets

$
3,581,415

$
2,980,345

LIABILITIES AND SHAREHOLDERS' EQUITY

Current Liabilities

Accounts Payable and Accrued Expense

$
525,308

$
654,140

Accrued Interest

50,347

11,111

Accrued Interest to Related Party

16,550

5,592

Premium Finance Loan Payable

—

53,643

Deferred Rent

16,692

—

Other Current Liabilities

16,237

—

Notes Payable

926,766

500,000

Total Current Liabilities

1,551,900

1,224,486

Long Term Debt to Related Parties, net of debt discount of $887,855 and $389,095

1,147,145

185,905

Total Liabilities

2,699,045

1,410,391

Commitments and contingencies (See Note 9)

Shareholders' Equity

Preferred stock, par value $0.01, 20,000,000 shares authorized,

600,000 and 100,000 shares issued and outstanding

Series A, 2,000,000 shares designated, 100,000 and

100,000 shares issued and outstanding

1,000

1,000

Series B, 1,000,000 shares designated, 0 and

0 shares issued and outstanding

—

—

Series C, 2,000,000 shares designated, 0 and

0 shares issued and outstanding

—

—

Series D, 2,000,000 shares designated, 0 and

0 shares issued and outstanding

—

—

Series E, 2,500,000 shares designated

5,000

—

500,000 and 0 issued and outstanding

Common stock, par value $0.01, 324,000,000 shares authorized,

46,168,864 issued and outstanding and 44,901,531 issued

and outstanding, respectively

461,689

449,016

Additional paid-in capital

11,343,468

9,944,744

Accumulated Deficit

(10,928,787
)

(8,824,806
)
Total shareholders' equity

882,370

1,569,954

Total liabilities and shareholders' equity

$
3,581,415

$
2,980,345

	March 31,			December 31,
	2022			2021
	(unaudited)
ASSETS
Current assets
Cash and cash equivalents	$	575,281		$	781,320
Accounts receivable, net of allowance for doubtful accounts of $767,395 and $495,396, at March 31, 2022 and December 31, 2021, respectively		2,686,897			3,550,126
Note receivable, net		14,957			21,415
Prepaid expenses and other current assets		885,361			904,716
Total current assets		4,162,496			5,257,577

Property and equipment, net		58,587			65,122
Website acquisition assets, net		3,600			4,000
Intangible assets, net		5,668,668			6,064,535
Goodwill		19,645,468			19,645,468
Prepaid services/consulting agreements – long term		189,882			284,825
Other assets		242,565			242,686
Total assets	$	29,971,266		$	31,564,213
LIABILITIES AND SHAREHOLDERS’ DEFICIT
Current liabilities
Accounts payable	$	8,455,898		$	8,459,561
Accrued expenses		3,206,208			3,764,665
Accrued interest to related party		1,199,694			640,255
Premium finance loan payable		212,178			334,284
Deferred revenues		860,417			1,162,425
Long term debt, current portion		295,600			1,387,140
Long term debt to related parties, current portion, net		-			7,316,402
Other current liabilities		84,645			5,052

Total current liabilities		14,314,640			23,069,784

Long term debt to related parties, net		24,190,054			15,217,569
Total liabilities		38,504,694			38,287,353

Commitments and Contingencies		-

Shareholders’ deficit
Convertible preferred stock, par value $0.01, 20,000,000 shares authorized:
Series A-1, 2,000,000 shares designated, 0 shares issued and outstanding at March 31, 2022 and December 31, 2021		–			–
Series B-1, 6,000,000 shares designated, 0 shares issued and outstanding at March 31, 2022 and December 31, 2021		–			–
Series E, 2,500,000 shares designated, 125,000 shares issued and outstanding at March 31, 2022 and December 31, 2021; liquidation preference of ($0.40 per share)		1,250			1,250
Series F, 4,344,017 shares designated, 0 shares issued and outstanding at March 31, 2022 and December 31, 2021		–			–
Preferred stock value
Common stock, par value $0.01, 324,000,000 shares authorized, 149,984,636 and 149,810,383 issued and 149,159,461 and 148,985,208 outstanding at March 31, 2022 and December 31, 2021, respectively		1,499,847			1,498,104
Treasury stock, at cost; 825,175 shares at March 31, 2022 and December 31, 2021		(219,837	)		(219,837	)
Additional paid-in capital		98,433,692			98,128,947
Accumulated deficit		(108,260,922	)		(106,144,065	)
Accumulated other comprehensive income		12,542			12,461
Total shareholders’ deficit		(8,533,428	)		(6,723,140	)
Total liabilities and shareholders’ deficit	$	29,971,266		$	31,564,213

See accompanying notes to unaudited condensed consolidated financial statements

BRIGHT MOUNTAIN MEDIA, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

~~(Unaudited)~~(unaudited)

For the Three Months Ended

For the Nine Months Ended

September 30,

September 30,

2017

2016

2017

2016

Product Sales

$
589,402

$
292,235

$
1,713,688

$
976,056

Revenues from Advertising

131,223

113,502

334,856

313,266

Total revenues

720,625

405,737

2,048,544

1,289,322

Cost of sales - Product

387,360

229,391

1,116,465

732,536

Cost of Revenues - Advertising

4,396

826

16,758

5,202

Gross profit

328,869

175,520

915,321

551,584

Selling, general and administrative expenses

801,307

686,802

2,750,275

2,205,855

Loss from operations

(472,438
)

(511,282
)

(1,834,954
)

(1,654,271
)

Other income (expense)

Interest income

232

11

451

21

Interest expense

20,883

—

(48,868
)

—

Interest expense - related party

(95,478
)

(297,130
)

(220,610
)

(335,015
)
Total other income (expense)

(74,363
)

(297,119
)

(269,027
)

(334,994
)

Net loss before income taxes

(546,801
)

(808,401
)

(2,103,981
)

(1,989,265
)
Income taxes

—

—

—

—

Net loss

(546,801
)

(808,401
)

(2,103,981
)

(1,989,265
)

Preferred stock dividends

Series A, Series B, Series C, Series D, and Series E preferred stock

1,122

60,339

3,849

278,525

Total preferred stock dividends

1,122

60,339

3,849

278,525

Net loss attributable to common shareholders

$
(547,923
)

$
(868,740
)

$
(2,107,830
)

$
(2,267,790
)

Basic and diluted net loss per share

$
(0.01
)

$
(0.02
)

$
(0.05
)

$
(0.06
)

Weighted average shares outstanding - basic and diluted

45,126,811

40,848,279

44,973,345

38,220,591

	2022			2021
	For the Three Months Ended March 31,
	2022			2021

Revenues
Advertising	$	3,459,164		$	2,399,720

Cost of revenue
Advertising		1,690,615			1,366,843
Gross profit		1,768,549			1,032,877

Selling, general and administrative expenses		3,887,359			4,274,434

Loss from operations		(2,118,810	)		(3,241,557	)

Other income (expense)
Gain on forgiveness of PPP loan		841,540			1,706,735
Other income (expense)		(157	)		121,830
Interest expense		(13	)		(260,995	)
Interest expense - related party		(839,417	)		(35,288	)
Total other income, net		1,953			1,532,282

Net loss before tax		(2,116,857	)		(1,709,275	)

Income tax benefit		–			–

Net loss		(2,116,857	)		(1,709,275	)

Dividends
Series A-1, Series E, and Series F preferred stock		(1,233	)		(88,976	)

Net loss attributable to common shareholders	$	(2,118,090	)	$	(1,798,251	)

Other comprehensive income (loss)	$	81		$	(31,289	)

Comprehensive loss	$	(2,118,009	)	$	(1,829,540	)

Basic and diluted net loss per common share	$	(0.01	)	$	(0.02	)
Weighted average common shares outstanding - basic and diluted		149,101,377			118,979,833

See accompanying notes to unaudited condensed consolidated financial statements

BRIGHT MOUNTAIN MEDIA, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGE IN ~~SHAREHOLDERS'~~SHAREHOLDERS’ (DEFICIT) EQUITY

For the ~~Nine~~Three Months Ended ~~September 30, 2017~~March 31, 2022 and 2021

~~(Unaudited)~~(unaudited)

Additional

Total

Preferred Stock

Common Stock

Paid-in

Accumulated

Shareholders'

Shares

Amount

Shares

Amount

Capital

Deficit

Equity

Balance – December 31, 2016

100,000

$
1,000

44,901,531

$
449,016

$
9,944,744

$
(8,824,806
)

$
1,569,954

Common stock issued for services ($0.850/share)

—

—

3,600

36

3,024

—

3,060

Common stock issued for 10% dividend payment pursuant to Series A preferred stock Subscription Agreements

—

—

10,000

100

(100
)

—

—

Issuance of Series E preferred Stock ($0.40/share)

500,000

5,000

—

—

195,000

—

200,000

Stock option compensation expense

—

—

—

—

95,821

—

95,821

Common stock issued as compensation

—

—

28,500

285

22,515

—

22,800

Beneficial conversion feature

—

—

—

—

615,625

—

615,625

Common stock issued for cash ($0.40/share)

—

—

125,000

1,250

48,750

—

50,000

Common stock issued in acquisition

1,100,233

11,002

418,089

—

429,091

Net loss for the nine months ended September 30, 2017

—

—

—

—

—

(2,103,981
)

(2,103,981
)
Balance – September 30, 2017

600,000

$
6,000

46,168,864

$
461,689

$
11,343,468

$
(10,928,787
)

$
882,370

	Shares		Amount		Shares		Amount		Shares			Amount			Capital			Deficit			Loss		Deficit
	Preferred Stock				Common Stock				Treasury Stock						Additional Paid-in			Accumulated			Accumulated Other Comprehensive		Total Stockholders’
	Shares		Amount		Shares		Amount		Shares			Amount			Capital			Deficit			Loss		Deficit
Balance, December 31, 2021		125,000	$	1,250		149,810,383	$	1,498,104		(825,175	)	$	(219,837	)	$	98,128,947		$	(106,144,065	)	$	12,461	$	(6,723,140	)
Net loss		—		—		—		—		—			—			—			(2,116,857	)		—		(2,116,857	)
Series E preferred stock dividend		—		—		—		—		—			—			(1,233	)		—			—		(1,233	)
Stock option vesting expense		—		—		—		—		—			—			28,916			—			—		28,916
Issuance of common stock:
To Oceanside personnel as part of acquisition agreement		—		—		174,253		1,743		—			—			277,062			—			—		278,805
Adjustment from foreign currency translation, net		—		—		—		—		—			—			—			—			81		81
Balance, March 31, 2022 (unaudited)		125,000	$	1,250		149,984,636	$	1,499,847		(825,175	)	$	(219,837	)	$	98,433,692		$	(108,260,922	)	$	12,542	$	(8,533,428	)

	Preferred Stock				Common Stock				Treasury Stock						Additional Paid-in			Accumulated			Accumulated Other Comprehensive			Total Stockholders’
	Shares		Amount		Shares		Amount		Shares			Amount			Capital			Deficit			Loss			Equity
Balance, December 31, 2020		8,044,017	$	80,440		118,162,150	$	1,181,622		(825,175	)	$	(219,837	)	$	96,427,166		$	(93,932,080	)	$	(22,665	)	$	3,514,646
Net loss		—		—		—		—		—			—			—			(1,709,275	)					(1,709,275	)
Series A-1, E and F preferred stock dividend		—		—		—		—		—			—			(88,978	)		—			—			(88,978	)
Stock option vesting expense																68,294									68,294
Issuance of common stock:
Options exercise		—		—		100,000		1,000		—			—			12,900			—			—			13,900
Warrants exercise						25,000		250								9,750									10,000
Adjustment from foreign currency translation, net																						(8,624	)		(8,624	)
To Oceanside personnel as part of acquisition agreement		—		—		379,266		3,793		—			—			603,033			—			—			606,826
Balance, March 31, 2021 (unaudited)		8,044,017	$	80,440		118,666,416	$	1,186,665		(825,175	)	$	(219,837	)	$	97,032,165		$	(95,641,355	)	$	(31,289	)	$	2,406,789

See accompanying notes to unaudited condensed consolidated financial statements

BRIGHT MOUNTAIN MEDIA, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

~~(Unaudited)~~(unaudited)

For the Nine Months Ended

September 30,

2017

2016

Cash flows from operating activities:

Net loss

$
(2,103,981
)

$
(1,989,265
)
Adjustments to reconcile net loss to net cash used in operations:

Depreciation

18,925

10,025

Amortization of debt discount

116,863

305,115

Amortization

227,418

186,007

Stock option compensation expense

95,821

107,193

Common stock issued for services

25,860

64,110

Product refund reserve

—

12,642

Changes in operating assets and liabilities:

Accounts receivable

35,663

(34,485
)
Inventory

142,550

7,842

Prepaid expenses and other current assets

102,751

1,446

Accounts payable and accrued expense

(194,163
)

53,679

Accrued interest

39,236

—

Accrued interest - related party

10,958

—

Other current liabilities

(557
)

—

Deferred rents

16,692

—

Other assets

93,375

(118,436
)
Net cash used in operating activities

(1,372,589
)

(1,394,127
)

Cash flows from investing activities:

Purchase of fixed assets

(14,305
)

(35,036
)
Purchase of websites

—

(142,925
)
Cash paid for acquisition, net of cash received

(199,573
)

—

Net cash used in investing activities

(213,878
)

(177,961
)

Cash flows from financing activities:

Proceeds from issuance of common and preferred stock

250,000

800,000

Repayments on insurance premium notes payable

(53,643
)

(41,758
)
Repayment of Notes Payable

(109,393
)

—

Long-term debt - Related parties

1,460,000

500,000

Net cash provided by financing activities

1,546,964

1,258,242

Net decrease in cash

(39,503
)

(313,846
)
Cash at beginning of period

162,795

416,187

Cash at end of period

$
123,292

$
102,341

	2022			2021
	For the Three Months Ended March 31,
	2022			2021
Cash flows from operating activities:
Net loss	$	(2,116,857	)	$	(1,709,275	)
Adjustments to reconcile net loss to net cash used in operations:
Depreciation		3,385			18,047
Amortization of debt discount		279,978			3,452
Amortization		396,267			396,266
Stock option compensation expense		28,916			68,294
Stock compensation for Oceanside shares		116,744			606,825
Gain on forgiveness of PPP loan		(841,540	)		(1,706,735	)
Write off doubtful accounts		-			(291,990	)
Warrant expense for services rendered		-			10,000
Provision for bad debt		271,355			6,096
Changes in operating assets and liabilities:
Accounts receivable		591,955			3,963,976
Prepaid expenses and other current assets		114,298			163,999
Other assets		121			(6,723	)
Right of use asset and lease liability		-			(128	)
Accounts payable		55,185			(1,561,413	)
Accrued expenses		(398,862	)		(218,071	)
Accrued interest – related party		559,439			35,287
Deferred revenues		(302,008	)		-
Net cash used in operating activities		(1,241,624	)		(222,093	)

Cash flows from investing activities:
Purchase of property and equipment		-			(6,564	)
Net cash (used in) provided by investing activities		-			(6,564	)

Cash flows from financing activities:
Payments of premium finance loan payable		(122,106	)		(105,600	)
Proceeds from stock option exercises		-			13,900
Dividend payments		1,233			1,261
Principal payments received (funded) for notes receivable		6,458			(6,458	)
Proceeds from debt financing		1,400,000			-
Repayments of debt		(250,000	)		-
Proceeds from PPP loan		-			1,137,140
Net cash provided by financing activities		1,035,585			1,040,243

Net (decrease) increase in cash and cash equivalents		(206,039	)		811,586
Cash and cash equivalents at the beginning of period		781,320			736,046
Cash and cash equivalents at end of period	$	575,281		$	1,547,632

See accompanying notes to unaudited condensed consolidated financial statements

BRIGHT MOUNTAIN MEDIA, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS ~~(CONTINUED)~~

~~(Unaudited)~~March 31, 2022

For the Nine Months Ended

September 30,

2017

2016

Supplemental disclosure of cash flow information

Cash paid for:

Interest

$
92,783

$
25,367

Income taxes

$
—

$
—

Non-cash investing and financing activities

Premium finance loan payable recorded as prepaid

$
18,885

$
43,402

Payable for purchase of website

$
—

$
150,000

Conversion of convertible notes payable and accrued interest into common stock

$
—

$
603,600

Beneficial conversion of debt discount to additional paid-in capital

$
615,625

$
289,000

Discount recognized relative to website acquisition payable

$
—

$
32,732

Common stock issued for acquisition of Daily Engage Media

$
429,091

$
—

Notes payable issued for acquisition of Daily Engage Media

$
380,000

$
—

(Unaudited)

~~During the nine months ended September 30, 2016 the Company issued 809,475 shares of its common stock as dividends to the holders of its Series A, Series B, Series C, and Series D Stock.~~

	For the Three Months Ended March 31,
	2022		2021
Supplemental disclosure of cash flow information
Cash paid for Interest	$	-	$	-

Supplemental disclosure of non-cash investing and financing activities
Issuance of common shares to Oceanside to settle share liability	$	162,061	$	-

During the nine months ended September 30, 2016 the Company issued 5,100,000 shares of its common stock to the holders of its Series A, Series B, Series C, and Series D convertible preferred stock for conversion of 5,100,000 shares of its convertible preferred stock Series A, Series B, Series C, and Series D.

~~During the nine months ended September 30,2017 the Company issued 10,000 shares of its common stock as a dividend to the holder of its Series A convertible preferred stock.~~

See accompanying notes to unaudited condensed consolidated financial statements

BRIGHT MOUNTAIN MEDIA, INC., AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~SEPTEMBER 30, 2017~~March 31, 2022

~~(Unaudited)~~(unaudited)

NOTE 1 – NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING ~~POLICIES.~~POLICIES.

Organization and Nature of Operations

Bright Mountain Media, Inc. (the “Company” or “Bright Mountain” or “We”) is a Florida corporation formed on May 20, 2010. Its wholly owned ~~subsidiaries,~~subsidiary, Bright Mountain ~~LLC, and The Bright Insurance Agency, LLC, were formed as Florida limited liability companies in May 2011. Its wholly owned subsidiary, Bright Watches,~~ LLC, was formed as a Florida limited liability company in ~~December 2015, and~~May 2011. Its wholly owned subsidiary, Bright Mountain, LLC (“BMLLC”) F/K/A Daily Engage Media Group, LLC (“Daily ~~Engage Media”~~Engage”) was formed as a New Jersey limited liability company in February 2015. In August 2019, Bright Mountain Israel Acquisition, an Israeli company was formed and acquired the wholly owned subsidiary Slutzky & Winshman Ltd. (“S&W”) which then changed its name to Oceanside Media LLC (“Oceanside”). Further, on November 18, 2019, Bright Mountain, through its wholly owned subsidiary BMTM2, Inc., a Florida corporation, acquired News Distribution Network, Inc. (“NDN”), a Delaware company, which then changed its name to MediaHouse, Inc. (“MediaHouse”). On June 1, 2020, Bright Mountain acquired the wholly owned subsidiary CL Media Holdings, LLC D/B/A “Wild Sky Media” (“Wild Sky”). When used herein, the terms ~~"BMTM, "~~“BMTM, the ~~"Company," "we," "us," "our"~~“Company,” “we,” “us,” “our” or ~~"Bright Mountain"~~“Bright Mountain” refers to Bright Mountain Media, Inc. and its subsidiaries.

The Company is engaged in operating a proprietary, end-to-end digital media ~~holding company~~and advertising services platform designed to connect brand advertisers with demographically-targeted consumers – both large audiences and more granular segments – across digital, social and connected television (CTV) publishing formats. We define “end-to-end” as our process for taking ad buying from beginning to end, delivering a complete functional solution, usually without requiring any involvement from a third party.

Through acquisitions and organic software development initiatives, we have consolidated and plan to further condense key elements of the prevailing digital advertising supply chain through the elimination of industry “middlemen” and/or costly redundancy of services via our ad exchange network. Our aim is to enable and support a streamlined, end-to-end advertising model that addresses both demand (ad buy side) and supply (media sell side) for both direct sales teams and programmatic sales and publishing of digital advertisements that reach specific target audiences based on what, where, when and how that specific target audience elects to access certain web and/or streaming video content. Programmatic advertising relies on computer programs to use data and proprietary algorithms to select which ads to buy and for what price, while direct sales involve traditional interpersonal contact between ad buyers and advertising sales representative(s).

By selling advertisements on our current portfolio of 20 owned and operated websites and 13 CTV apps, coupled with acquisition or development of other niche web properties in the future, we are building depth in specific demographic verticals that allow us to package audiences into targeted consumer categories valued by advertisers.

Oceanside provides digital performance-based marketing services to customers which include primarily advertisers and advertising agencies that promote or sell products and/or services to consumers through digital media.

MediaHouse partners with content producers and online ~~assets targeting~~news market websites to distribute video and ~~servicing~~banner advertisements throughout the ~~military and public safety markets. The Company~~United States of America (“U.S.”).

Wild Sky owns and ~~manages 24~~operates a collection of websites ~~which are customized to provide our~~that offer significant global reach through its content and niche ~~users, including active, reserve~~audiences and retired military, law enforcement, first responders and other public safety employees with information and news that we believe may be of interest to them. Coupled with its recently acquired wholly ownedhas become a wholly-owned subsidiary Daily Engage Media, the Company has evolved to place its emphasis on providing quality content on its websites to drive traffic increases so that it can monetize these visits through advertising revenue. We generate revenues from two segments, product sales and advertising. The advertising segment consists primarily of advertising revenue and a small amount of subscription and service revenue.

On December 16, 2016, with an effective date of December 15, 2016, under the terms of an Asset Purchase Agreement, the Company acquired the assets, constituting the Black Helmet Apparel business (“Black Helmet Apparel”), from Sostre Enterprises, Inc. Assets acquired included various website properties and content, social media content, inventory and other intellectual property rights. The Black Helmet Apparel line of apparel features clothing and accessories focused on first responders.

~~On September 19, 2017, under the terms of an Amended and Restated Membership Interest Purchase Agreement with Daily Engage Media, and its members, the Company acquired 100%~~ of the ~~membership interests of Daily Engage Media. Launched in 2015, Daily Engage Media~~Company. Wild Sky is ~~an ad network that connects advertisers with approximately 200 digital publications worldwide.~~the home to parenting and lifestyle brands.

~~Basis of Presentation~~BRIGHT MOUNTAIN MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~The interim unaudited~~March 31, 2022

(unaudited)

NOTE 2 - GOING CONCERN.

These condensed consolidated financial statements ~~included herein~~ have been prepared byon a going concern basis which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. The Company’s management has evaluated whether there is substantial doubt about the Company’s ability to continue as a going concern and has determined that substantial doubt existed as of the date of the end of the period. This determination was based on the following factors: (i) The Company has sustained a net loss of $2,116,857; (ii) used cash from operating activities of $1,241,624 for the three months ended March 31, 2022; (iii) has an accumulated deficit of $108,260,922 at March 31, 2022; (iv) the Company’s available cash as of the date of this filing will not be sufficient to fund its anticipated level of operations for the next 12 months; (v) the Company ~~pursuant~~will require additional financing for the fiscal year ending December 31, 2022 to continue at its expected level of operations; and (vi) if the ~~rules and regulations~~Company fails to obtain the needed capital, it will be forced to delay, scale back, or eliminate some or all of ~~the Securities and Exchange Commission (the “SEC”).~~its development activities or perhaps cease operations. In the opinion of management, these factors, among others, raise substantial doubt about the ~~Company’s management, all adjustments necessary~~ability of the Company to ~~present fairly~~continue as a going concern as of the ~~consolidated results~~date of ~~operations~~the end of the period and ~~cash flows~~ for one year from the ~~nine months ended September 30, 2017 and the~~issuance of these condensed consolidated financial ~~position~~statements.

The Company’s continuation as a going concern is dependent upon its ability to generate revenues, control its expenses and its ability to continue obtaining investment capital and loans from related parties and outside investors to sustain its current level of ~~September 30, 2017 have been made.~~operations. Management continues raising capital through private placements and is exploring additional avenues for future fund-raising through both public and private sources. The ~~results~~Company is not currently involved in any binding agreements to raise private equity capital. The accompanying condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of ~~operations for such interim period are not necessarily indicative~~recorded asset amounts or the amounts and classification of liabilities that might be necessary should the ~~operating results expected for the full year.~~Company be unable to continue as a going concern.

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES.

Principles of Consolidation and Basis of Presentation

The ~~interim~~ unaudited condensed consolidated financial statements include the accounts of the Company and all of its wholly owned subsidiaries. All ~~significant~~ intercompany ~~transactions~~accounts and ~~balances~~transactions have been eliminated in ~~consolidation.~~

~~Use of Estimates~~

~~Our~~the unaudited condensed consolidated financial statements. The accompanying unaudited financial statements ~~are~~for the three months ended March 31, 2022 and 2021 have been prepared in accordance with ~~Accounting Principles Generally Accepted~~U.S. generally accepted accounting principles (“GAAP”) applicable to interim financial information and the requirements of Form 10-Q and Article 8 of Regulation S-X of the Securities Act of 1933. Accordingly, they do not include all of the information and disclosures required by accounting principles generally accepted in the United States ~~(“GAAP”~~for complete consolidated financial statements. In the opinion of management, such unaudited condensed consolidated financial statements include all adjustments (consisting of normal recurring accruals) necessary for the fair presentation of the condensed consolidated financial position and the condensed consolidated results of operations. The condensed consolidated results of operations for periods presented are not necessarily indicative of the results to be expected for the full year or any future periods. The condensed consolidated balance sheet information as of December 31, 2021 was derived from the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, as filed with the SEC on June 13, 2022. The interim condensed consolidated financial statements should be read in conjunction with that report.

Revenue Recognition

The Company recognizes revenue in accordance with FASB ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”). ~~These accounting principles require~~The Company recognizes revenues at a point-in-time when control of services is transferred to the customer. Cash received by the Company prior to when control of services is transferred to the customer is recorded as deferred revenue.

To determine revenue recognition for arrangements that the Company determines are within the scope of ASC 606, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that Company will collect the consideration it is entitled to in exchange for the advertising services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company assesses the advertising services promised within each contract and determines those that are performance obligations and assesses whether each promised advertising service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation based on relative fair values, when (or as) the performance obligation is satisfied.

BRIGHT MOUNTAIN MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022

(unaudited)

The Company recognizes revenue from its own advertising platform, ad network partners and websites (“Ad Network”) through its publishing advertiser impressions and pay-for-click services, the Company’s owned and operated sites, our ad network, or platforms. Invalid traffic on the Ad Network may impact the amount collected and adjusted by our Ad Network.

The Company has one revenue stream generated directly from publishing advertisements, whether on the Company’s owned and operated sites, our ad network, or platforms. The revenue is earned when the website visitors view or click the published website advertisements. Specific revenue recognition criteria for the advertising revenue stream is as follows:

	●	Advertising revenues are generated by website visitors viewing or “clicking” on website advertisements utilizing direct-sold campaigns or several ad network partners.

	●	Revenues are recognized net of adjustments based on the traffic generated and is billed monthly. The Company subsequently settles these transactions with publishers at which time adjustments for invalid traffic may impact the amount collected.

There are no significant initial costs incurred to obtain contracts with customers, and no contract assets or contract liabilities recorded in our condensed consolidated financial statements.

Leases

The Company records leases in accordance with FASB ASC Topic 842, Leases.

The Company determines if an arrangement is a lease at inception. Operating lease right-of-use assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease terms. Since the Company’s lease agreements does not provide an implicit rate, the Company estimated an incremental borrowing rate based on the information available in determining the present value of lease payments. Operating lease expense is recognized on a straight-line basis over the lease term, subject to any changes in the lease or expectations regarding the terms. Variable lease costs such as operating costs and property taxes are expensed as incurred.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make certain estimates, judgments, and assumptions. We believe that the estimates, judgments, and assumptions upon which we rely are reasonable based upon information available to us at the time that these estimates, judgments, and assumptions are made. These estimates, judgments, and assumptions can affect the reported amounts of assets and liabilities as of the date of our condensed consolidated financial statements as well as reported amounts of revenue and expenses during the periods presented. Our condensed consolidated financial statements would be affected to the extent there are material differences between these estimates and actual results. In many cases, the accounting treatment of a particular transaction is specifically dictated by GAAP and does not require ~~management's~~management’s judgment in its application. There are also areas in which ~~management's~~management’s judgment in selecting any available alternative would not produce a materially different result.

Significant estimates included in the accompanying condensed consolidated financial statements include revenue recognition, the fair value of acquired assets for purchase price allocation in business combinations, valuation of ~~inventory, valuation of~~goodwill and intangible assets, estimates of amortization period for intangible assets, estimates of depreciation period for fixed assets, the valuation of equity-based transactions, and the valuation ~~of equity based transactions.~~allowance on deferred tax assets.

BRIGHT MOUNTAIN MEDIA, INC., AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~SEPTEMBER 30, 2017~~March 31, 2022

~~(Unaudited)~~(unaudited)

~~NOTE 1 – NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued).~~

Cash and Cash Equivalents

The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. Cash and cash equivalents are all maintained in bank accounts in the U.S. and other foreign countries in which the Company operates. Cash maintained in bank accounts outside of the U.S. is not significant. At March 31, 2022 and December 31, 2021, the Company had $575,281 and $781,320, respectively, in cash and cash equivalents.

Credit Risk

The Company maintains certain of its cash balances in various U.S. banks, which at times, may exceed federally insured limits. The Company has not incurred any losses on these accounts. In addition, the Company maintains various bank accounts in Thailand and Israel, which are not insured. During the three months ended March 31, 2022 and 2021, and the year ended December 31, 2021, we have not incurred material losses on these uninsured accounts. The Company minimizes the concentration of credit risk associated with its cash by maintaining its cash with high quality federally insured financial institutions. The Company performs ongoing evaluations of its trade accounts receivable customers and generally does not require collateral.

Fair Value of Financial Instruments and Fair Value Measurements

FASB ASC Topic 820, Fair Value Measurement and Disclosures (“ASC 820”) defines fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s level within the fair value hierarchy is based on the lowest level of input significant to the fair value measurement.

The Company measures its financial assets and liabilities in accordance with GAAP. For certain of our financial instruments, including cash, accounts payable, accrued expenses, and the short-term portion of long-term debt, the carrying amounts approximate fair value due to their short maturities.

We adopted accounting guidance for ~~financial~~fair values measurements and ~~non-financial assets and liabilities in accordance with Accounting Standards Codification (“ASC”) 820 “~~~~Fair Value Measurements and Disclosures~~.” This standard defines fair value, provides guidance for measuring fair value and requires certain disclosures. This standard does not require any new fair value measurements, but rather applies to all other accounting pronouncements that require or permit fair value measurements. This guidance does not apply to measurements related to share-based payments. This guidance discusses valuation techniques, such as the market approach (comparable market prices), the income approach (present value of future income or cash flow), and the cost approach (cost to replace the service capacity of an asset or replacement cost)disclosures (ASC 820). The guidance utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The following is a brief description of those three levels:


	Level 1:	Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities.

	Level 2:	Inputs other than quoted prices that are observable, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not ~~active.~~ active; and

	Level 3:	Unobservable inputs in which little or no market data exists, therefore developed using estimates and assumptions developed by us, which reflect those that a market participant would use.

Financial instruments recognized in the condensed consolidated balance sheets consist of cash, accounts receivable, prepaid expenses and other current assets, note receivable, accounts payable, accrued expenses and premium finance loan payable. The Company believes that the carrying value of its current financial instruments approximates their fair values due to the short-term nature of these instruments. The carrying value of long-term debt to related parties and long-term debt to others approximates the current borrowing rate for similar debt instruments.

BRIGHT MOUNTAIN MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022

(unaudited)

Financial Disclosures about Fair Value of Financial Instruments

The tables below set forth information related to the Company’s financial instruments (in thousands):

SCHEDULE OF FINANCIAL INSTRUMENTS

	Level in Fair		March 31, 2022				December 31, 2021
	Value Hierarchy		Carrying Amount		Fair Value		Carrying Amount		Fair Value

PPP Loan		2	$	295,600	$	295,600	$	1,137,140	$	1,137,140
Long-term debt to related parties		3	$	28,216,564	$	28,216,564	$	26,414,064	$	26,414,064
Non-interest bearing BMLLC acquisition debt		2	$	-	$	-	$	250,000	$	250,000

The following are the major categories of liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) as of March 31, 2022 and December 31, 2021:

Fair Value measurement using Level 3

SCHEDULE OF FAIR VALUE OF LIABILITIES ON RECURRING BASIS

Total long term debt at December 31, 2020	$	16,916,705
Reclassification ⁽¹⁾		(464,800	)
Total long term debt at March 31, 2021		16,451,905

Total long term debt to related parties at December 31, 2021	$	22,533,971
Addition: Related party debt ⁽²⁾		1,400,000
Decrease: Related party debt amortization ⁽³⁾		256,083
Total long term debt to related parties at March 31, 2022	$	24,190,054

	(1)	Related to reclassification of Bright Mountain PPP loan
	(2)	Centre Lane debt financing from January 1, 2022 through March 31, 2022
	(3)	Debt discount additions and debt discount amortization on related party financings for the three months ended March 31, 2022

Off-balance sheet arrangements

Notes Payable and related potential liabilities are excluded from the balance sheet when there are significant uncertainties associated with the likelihood that the liabilities will be paid in full or until such time that the amount of the liability can be reasonably determined or estimated. There are no off-balance sheet arrangements as of March 31, 2022 and December 31, 2021.

Accounts Receivable

Accounts receivable represent receivables from customers in the ordinary course of business. These are recorded at ~~fair value~~invoice amount on the date revenue is recognized. Receivables are recorded net of the allowance for doubtful accounts in the accompanying condensed consolidated balance sheets. The Company provides allowances for doubtful accounts for estimated losses resulting from the inability of its customers to repay their obligation. If the financial condition of the ~~Company's~~Company’s customers were to deteriorate, resulting in an impairment of their ability to repay, additional allowances may be required. The Company provides for potential uncollectible accounts receivable based on specific customer identification and historical collection experience adjusted for existing market conditions. If market conditions decline, actual collection experience may not meet expectations and may result in decreased cash flows and increased bad debt expense. The Company is also subject to adjustments from traffic settlements that are deducted from open invoices.

The policy for determining past due status is based on the contractual payment terms of each customer, which are generally net 6030 or net 9060 days. Once collection efforts by the Company and its collection agency are exhausted, the determination for charging off uncollectible receivables is made. As of March 31, 2022 and December 31, 2021, the Company has recorded an allowance for doubtful accounts of $767,395 and $495,396, respectively.

~~Inventories~~

Inventories consist of finished goods and are stated at the lower of cost or market using the first in, first out (FIFO) method. Provisions have been made to reduce excess or obsolete inventories to their net realizable value.

BRIGHT MOUNTAIN MEDIA, INC., AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~SEPTEMBER 30, 2017~~March 31, 2022

~~(Unaudited)~~(unaudited)

~~NOTE 1 – NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued).~~

~~Revenue Recognition~~

~~The Company recognizes revenue on our products in accordance with ASC 605, “~~~~Revenue Recognition~~.” Under these guidelines, revenue is recognized on sales transactions when all of the following exist: persuasive evidence of an arrangement did exist; delivery of the product or advertising has occurred; the sales price to the buyer is fixed or determinable; and collectability is reasonably assured. The Company has several revenue streams generated directly from its website and specific revenue recognition criteria for each revenue stream is as follows:


	·	Sale of merchandise directly to consumers: The Company's product sales are recognized either FOB shipping point or FOB destination, dependent on the customer. Revenues are therefore recognized at point of ownership transfer, accordingly;

	·	~~Advertising revenue is received directly form companies who pay the Company a monthly fee for advertising space and;~~

	·	Advertising revenues are generated by users “clicking” on website advertisements utilizing several ad network partners. Revenues are recognized net of their fees for Company owned websites upon receipt of payment by the ad network partner since the revenue is not determinable until it is received; and

~~The Company follows the guidance of ASC 605-50-25, “~~~~Revenue Recognition, Customer Payments~~.” Accordingly, any incentives received from vendors are recognized as a reduction of the cost of products included in inventories. Promotional products or samples given to customers or potential customers are recognized as a cost of goods sold.

Our Daily Engage Media subsidiary is an Advertising Exchange Company that matches advertisers with publishers. Revenue is generated and recognized when ads appear and are viewed on websites in the Company’s portfolio.

~~Cost of Sales and Cost of Revenues~~

Components of costs of sales for the products segment include product costs, shipping costs to customers and any inventory adjustments for product sales. Cost of revenue for the advertising segment consists of revenue share payments to media providers and website publishers that are directly related to a revenue-generating event. The Company becomes obligated to make the revenue share payments in the period the advertising impressions, click-throughs, actions or lead-based information are delivered or occur.

~~Shipping and Handling Costs~~

~~The Company includes shipping and handling fees billed to customers as revenues and shipping and handling costs for shipments to customers as cost of revenues.~~

~~Sales Return Reserve Policy~~

Our return policy generally allows our end users to return purchased products for refund or in exchange for new products. We estimate a reserve for sales returns, if any, and record that reserve amount as a reduction of sales and as a sales return reserve liability. Sales to consumers on our web site generally may be returned within a reasonable period of time.

~~Product Warranty Reserve Policy~~

~~The Company is a retail distributor of products and warranties are the responsibility of the manufacturer. Therefore, the Company does not record a reserve for product warranty~~

Property and Equipment

Property and equipment isare recorded at ~~cost.~~cost, less accumulated depreciation. Depreciation is computed using the straight-line method based on the estimated useful lives of the related ~~assets of five to seven years for office furniture and equipment, and five years for computer equipment.~~assets. Leasehold improvements are amortized over the lesser of the lease term or the useful life of the improvements. ~~Expenditures for maintenance and repairs along with fixed assets with a purchase price below our capitalization threshold of $500 are expensed as incurred.~~

~~BRIGHT MOUNTAIN MEDIA, INC., AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~SEPTEMBER 30, 2017~~

~~(Unaudited)~~

~~NOTE 1 – NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued).~~

Website Development Costs

The Company accounts for its website development costs in accordance with FASB ASC Topic 350-50, “Website Development Costs~~” (“ASC 350-50”)~~. These costs, if any, are included in intangible assets in the accompanying condensed consolidated ~~financial statements or expensed immediately if the Company cannot support recovery of these costs from positive future cash flows.~~

ASC 350-50 requires the expensing of all costs of the preliminary project stage and the training and application maintenance stage and the capitalization of all internal or external direct costs incurred during the application and infrastructure development stage.balance sheets. Upgrades or enhancements that add functionality are capitalized while other costs during the operating stage are expensed as incurred. The Company amortizes the capitalized website development costs over an estimated life of five years.

As of ~~September 30, 2017~~March 31, 2022 and ~~2016,~~December 31, 2021, all website development costs have been expensed.

~~Amortization and Impairment of Long-Lived Assets~~

Amortization and impairment of long-lived assets are non-cash expenses relating primarily to intangible assets. The Company accounts for long-lived assets in accordance with the provisions of ASC 360-10 “~~Accounting for the Impairment or Disposal of Long-Lived Assets~~.” This statement requires that long-lived assets and certain identifiable intangibles be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

Website acquisition costs, including related customer relationships and non-compete agreements, are amortized over three to five years. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future undiscounted net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. While it is likely that we will have significant amortization expense as we continue to acquire websites, we believe that intangible assets represent costs incurred by the acquired website to build value prior to acquisition and the related amortization and impairment charges of assets, if applicable, are not ongoing costs of doing business. ~~Non-cash amortization loss~~

Amortization and Impairment of Long-Lived Assets

The Company evaluates long-lived assets, including amortizable intangible assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Upon such an occurrence, recoverability of assets to be held and used is ~~included in selling, general and administrative expenses~~measured by comparing the carrying amount of an asset to forecasted undiscounted future net cash flows expected to be generated by the asset. If the carrying amount of the asset exceeds its estimated future cash flows, an impairment charge is recognized for the amount by which the carrying amount of the asset exceeds the fair value of the asset. For long-lived assets held for sale, assets are written down to fair value, less cost to sell. Fair value is determined based on discounted cash flows, appraised values or management’s estimates, depending upon the ~~accompanying statement~~nature of ~~operations. For~~ the three months ended September 30, 2017 and 2016, non-cash amortization expense was $75,876 and $61,582, respectively. For the nine months ended September 30, 2017 and 2016, non-cash amortization expense was $227,418 and $186,007, respectively.assets.

Stock-Based Compensation

The Company accounts for ~~stock-based~~share-based compensation related to instruments issued to employees and non-employees under GAAP, which requires the measurement and recognition compensation costs for ~~services in accordance with ASC 718 “~~~~Compensation – Stock Compensation~~~~.” ASC 718 requires companies to recognize in the statement of operations the grant-date~~all equity-based payment awards based on estimated fair ~~value of stock options and other equity based compensation issued to employees.~~values. The value of the portion of an employee award that is ultimately expected to vest is recognized as an expense over the requisite service periods using the straight-line attribution method. The Company ~~accounts for non-employee share-based awards in accordance with the measurement and recognition criteria of ASC 505-50, “~~~~Equity-Based Payments to Non-Employees~~~~.” The Company~~ estimates the fair value of stock options by using the Black-Scholes option-pricing model. ~~Non- cash stock-based stock option~~Share-based compensation expense is ~~expensed over the requisite service period and are~~ included in selling, general and administrative expenses on the accompanying condensed consolidated ~~statement~~statements of ~~operations. For the three months ended September 30, 2017~~operations and 2016, non-cash stock-based stock option compensation expense was $21,983 and $30,069, respectively. For the nine months ended September 30, 2017 and 2016, non-cash stock-based stock option compensation expense was $95,821 and $107,193, respectively.comprehensive loss. We have elected to account for forfeitures as they occur.

~~BRIGHT MOUNTAIN MEDIA, INC., AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~SEPTEMBER 30, 2017~~

~~(Unaudited)~~

~~NOTE 1 – NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued).~~

Advertising, Marketing and Promotion Costs

Advertising ~~marketing~~ and ~~promotion~~marketing expenses are expensed as incurred and are included in selling, general and administrative expenses on the accompanying ~~statement~~consolidated statements of ~~operations.~~operations and comprehensive loss. For the three months ended ~~September 30, 2017~~March 31, 2022 and ~~2016,~~2021, advertising, marketing and promotion expense was ~~$66,436~~$5,709 and ~~$3,050,~~$12,615, respectively. ~~For~~

BRIGHT MOUNTAIN MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022

(unaudited)

Foreign currency translation

Assets and liabilities of the ~~nine~~Company’s Israeli subsidiary are translated from Israeli shekels to United States dollars at exchange rates in effect at the balance sheet date. Income and expenses are translated at the exchange rates for the weighted average rates for the period. The translation adjustments for the reporting period will be included in our statements of comprehensive income. Based on the foreign subsidiaries’ activities the impact of the currency exchange is immaterial for the three months ended ~~September 30, 2017~~March 31, 2022 and ~~2016, advertising, marketing and promotion expense was $231,669 and $15,156, respectively.~~2021.

Income Taxes

We use the asset and liability method to account for income taxes. Under this method, deferred income taxes are determined based on the differences between the tax basis of assets and liabilities and their reported amounts in the consolidated financial statements which will result in taxable or deductible amounts in future years and are measured using the currently enacted tax rates and laws. A valuation allowance is provided to reduce net deferred tax assets to the amount that, based on available evidence, is more likely than not to be realized.

The Company follows the provisions of FASB ASC ~~740-10“~~Topic 740-10, ~~Accounting for Uncertain~~ Income ~~Tax Positions.~~Taxes – Overall ”(“ASC 740-10”). When tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that would be ultimately sustained. In accordance with the guidance of ASC 740-10, the benefit of a tax position is recognized in the financial statementsin the period during which, based on all available evidence, management believes it is more likely than not that the position will besustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset oraggregated with other positions. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largestamount of tax benefit that is more than ~~50%~~50 percent likely of being realized upon settlement with the applicable taxing authority. Theportion of the benefits associated with tax positions taken that exceeds the amount measured as described above should be reflected asa liability for unrecognized tax benefits in the accompanying condensed consolidated balance sheets along with any associated interest and penalties that wouldbe payable to the taxing authorities upon examination. Interest and penalties associated with unrecognized tax expenses are recognized as tax expenses in the Statement of Operations and comprehensive loss.

As of ~~September 30, 2017,~~March 31, 2022, tax years ~~2016, 2015, and 2014~~2018 through 2021 remain open for ~~IRS~~Internal Revenue Service (“IRS”) audit. The Company has not received noany notice of audit or ~~any~~ notifications from the IRS for any of the open tax years.

Concentrations

The Company generates revenues from through Ad Exchange Networks and through our Owned and Operated Ad Exchange Network. There was one customer who accounted for approximately 24.3% of the revenues for the three months ended March 31, 2022. No other customer was over 10% of revenues for the three months ended March 31, 2022. There was only one customer which accounted for greater than 10% of the revenue with approximately 11.3% for the three months ended March 31, 2021.

As of March 31, 2022, one customer accounted for more than 10% of the accounts receivable balance, at 24.3%. As of December 31, 2021, two customers accounted for more than 10% of the accounts receivable balance, at 13.1% and 12.0%. As of March 31, 2022, one vendor accounted for more than 10% of the accounts payable, at 11.2%. As of December 31, 2021, one vendor accounted for more than 10% of the accounts payable balance, at 11.2%.

Credit Risk

The Company maintains certain of its cash balances in various U.S. banks, which at times, may exceed federally insured limits. The Company has not incurred any losses on these accounts. In addition, the Company maintains various bank accounts in Thailand, which are not insured. During the three months ended March 31, 2022 and 2021, we have not incurred material losses on these uninsured accounts. The Company minimizes the concentration of credit risk associated with its cash by maintaining its cash with high quality federally insured financial institutions. The Company performs ongoing evaluations of its trade accounts receivable customers and generally does not require collateral.

BRIGHT MOUNTAIN MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022

(unaudited)

Concentration of Funding

Historically, the Company had a large portion of the funding provided through the sale of shares of the Company’s common stock with related warrants; however, during the three months ended March 31, 2022 and 2021 no funding through the sale of shares occurred.

Basic and Diluted Net Earnings (Loss) Per Common Share

~~In accordance with ASC 260-10 “~~Earnings ~~Per Share~~,”(loss) per share is calculated and reported under the “two-class” method. The “two-class” method is an earnings allocation method under which earnings per share is calculated for each class of common stock and participating security considering both dividends declared or accumulated and participation rights in undistributed earnings as if all such earnings had been distributed during the period. The Company has convertible preferred stock which have a right to participate in dividends; these are deemed to be participating securities. During periods of loss, there is no allocation required under the two-class method since the participating securities do not have a contractual obligation to fund the losses of the Company.

When applicable, basic ~~net~~ earnings (loss) per ~~common~~ share is ~~computed~~calculated by dividing ~~the~~ net income, after deducting dividends on convertible preferred stock and participating securities as well as undistributed earnings ~~(loss) for the period~~allocated to participating securities, by the ~~weighted~~ average number of common shares outstanding during the period. Diluted earnings (loss) per share ~~are computed using~~is calculated in a similar manner after consideration of the ~~weighted~~potential dilutive effect of common stock equivalents on the average number of common ~~and dilutive common stock equivalent~~ shares outstanding during the period. ~~As of September 30, 2017 and 2016, there were approximately 2,187,000 and 2,267,000 common stock equivalent shares outstanding as stock options, respectively, 600,000 and 100,000 common~~Common stock equivalents ~~from the conversion of preferred~~include warrants and stock ~~respectively, and 4,300,000 and 200,000 common~~options. Common stock equivalents ~~from~~are calculated based upon the ~~conversion~~treasury stock method using an average market price of ~~notes payable, respectively. Equivalent~~common shares ~~were not utilized, as~~during the ~~effect is anti-dilutive.~~

~~Segment Information~~

~~In accordance with the provisions of ASC 280-10, “~~~~Disclosures about Segments of an Enterprise and Related Information~~”, the Company is required to report financial and descriptive information about its reportable operating segments. The Company has two identifiable operating segments based on the activities of the company in accordance with the ASC 280-10 The Company's two segments are product sales and advertising as of September 30, 2017. The product sales segment sells merchandise directly to customers thorough e-commerce distributor portals such as Amazon and eBay and through our proprietary websites and retail location. The advertising segment is focused on producing advertising revenue generated by users viewing website advertisements utilizing several ad network partners and direct advertisers and subscription revenue generated by the sale of access to premium versions of our websites and to career postings on one of our websites.

~~BRIGHT MOUNTAIN MEDIA, INC., AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~SEPTEMBER 30, 2017~~

~~(Unaudited)~~

~~NOTE 1 – NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued).~~

~~Recent Accounting Pronouncements~~

~~In June 2014, FASB issued Accounting Standards Update (“ASU”) No. 2014-09, “~~~~Revenue from Contracts with Customers~~.”The update gives entities a single comprehensive model to use in reporting information about the amount and timing of revenue resulting from contracts to provide goods or services to customers. The proposed ASU, which would apply to any entity that enters into contracts to provide goods or services, would supersede the revenue recognition requirements in ASC 605 "~~Revenue Recognition~~~~," and most industry-specific guidance throughout the Industry Topics of the Codification. Additionally, the update would supersede some cost guidance included in Subtopic 605-35 "~~~~Revenue Recognition – Construction-Type and Production-Type Contracts~~." The update removes inconsistencies and weaknesses in revenue requirements and provides a more robust framework for addressing revenue issues and more useful information to users of financial statements through improved disclosure requirements. In addition, the update improves comparability of revenue recognition practices across entities, industries, jurisdictions, and capital markets and simplifies the preparation of financial statements by reducing the number of requirements to which an entity must refer. The update is effective for annual reporting periods beginning after December 15, 2018, and interim reporting periods within annual reporting periods beginning after December 15, 2019. All other entities may apply the guidance in ASU No. 2014-09 earlier as of an annual reporting period beginning after December 15, 2016, including interim reporting periods within that reporting period. All other entities also may apply the guidance in Update 2014-09 earlier as of an annual reporting period beginning after December 15, 2016, and interim reporting periods within annual reporting periods beginning one year after the annual reporting period in which the entity first applies the guidance in ASU No. 2014-09. We are currently reviewing the provisions of this ASU to determine if there will be any impact on our results of operations, cash flows or financial condition.

~~In August 2014, the FASB issued ASU No. 2014-15, “~~~~Presentation of Financial Statements - Going Concern~~,” which requires management to evaluate, at each annual and interim reporting period, whether there are conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date the financial statements are issued and provide related disclosures. ASU 2014-15 is effective for annual periods ending after December 15, 2016 and interim periods thereafter. Early application was permitted. The adoption of ASU 2014-15 did not have a material effect on our condensed consolidated financial statements.

~~In July 2015, FASB issued ASU No. 2015-11~~~~, “Inventory (Topic 330): Simplifying the Measurement of Inventory~~” more closely align the measurement of inventory in GAAP with the measurement of inventory in International Financial Reporting Standards (IFRS). The amendments in this ASU do not apply to inventory that is measured using last-in, first-out (LIFO) or the retail inventory method. The amendments apply to all other inventory, which includes inventory that is measured using first-in, first-out (FIFO) or average cost. An entity should measure inventory within the scope of this Update at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. Subsequent measurement is unchanged for inventory measured using LIFO or the retail inventory method.For public business entities, this ASU is effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. For all other entities, this ASU is effective for fiscal years beginning after December 15, 2016, and interim periods within fiscal years beginning after December 15, 2017. The amendments in this ASU should be applied prospectively with earlier application permitted as of the beginning of an interim or annual reporting period.The adoption of ASU No. 2015-11 did not have a material effect on our condensed consolidated financial statements.

~~In February 2016, the FASB issued ASU 2016-02 “~~~~Leases~~,” which will amend current lease accounting to require lessees to recognize (i) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis, and (ii) a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. ASU 2016-02 does not significantly change lease accounting requirements applicable to lessors; however, certain changes were made to align, where necessary, lessor accounting with the lessee accounting model. This standard will be effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. We are currently reviewing the provisions of this ASU to determine if there will be any impact on our results of operations, cash flows or financial condition.

~~BRIGHT MOUNTAIN MEDIA, INC., AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~SEPTEMBER 30, 2017~~

~~(Unaudited)~~

~~NOTE 1 – NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued).~~

~~In March 2016, the FASB issued ASU 2016-09,~~~~Compensation – Stock Compensation: Improvements to Employee Share-Based Payment Accounting~~, which relates to the accounting for employee share-based payments. This standard addresses several aspects of the accounting for share-based payment award transactions, including: (a) income tax consequences; (b) classification of awards as either equity or liabilities; and (c) classification on the statement of cash flows. This standard will be effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. The adoption of ASU No. 2016-9 did not have a material effect on our condensed consolidated financial statements.

~~In April 2016, the FASB issued ASU 2016–10~~~~“Revenue from Contract with Customers~~~~(ASC 606):~~~~Identifying Performance Obligations and Licensing.”~~The amendments in this Update do not change the core principle of the guidance in ASC 606. Rather, the amendments in this Update clarify the following two aspects of ASC 606: identifying performance obligations and the licensing implementation guidance, while retaining the related principles for those areas. ASC 606 includes implementation guidance on (a) contracts with customers to transfer goods and services in exchange for consideration and (b) determining whether an entity’s promise to grant a license provides a customer with either a right to use the entity’s intellectual property (which is satisfied at a point in time) or a right to access the entity’s intellectual property (which is satisfied over time). The amendments in this Update are intended render more detailed implementation guidance with the expectation to reduce the degree of judgement necessary to comply with ASC 606. We are currently reviewing the provisions of this ASU to determine if there will be any impact on our results of operations, cash flows or financial condition.

~~In April 2016, the FASB issued ASU No. 2016-15,~~~~“Classification of Certain Cash Receipts and Cash Payments”~~ASU 2016- provides guidance regarding the classification of certain items within the statement of cash flows. ASU 2016-15 is effective for annual periods beginning after December 15, 2017 with early adoption permitted. We do not believe this ASU will have an impact on our results of operation, cash flows, other than presentation, or financial condition.

~~In January 2017, the FASB issued 2017-04,~~~~Intangibles - Goodwill and Other~~ (Topic 350): Simplifying the Test for Goodwill Impairment. The amendments in this ASU simplify the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test and eliminating the requirement for a reporting unit with a zero or negative carrying amount to perform a qualitative assessment. Instead, under this pronouncement, an entity would perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount and would recognize an impairment change for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognizedDilution is not ~~to exceed the total amount of goodwill allocated to that reporting unit. In addition, income tax effects will be~~ considered if applicable. This ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted. The Company is currently evaluating the impact of this ASU on its consolidated financial statements and related disclosures.

~~NOTE 2 - GOING CONCERN.~~

The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company sustainedwhen a net loss is reported. Common stock equivalents that have an antidilutive effect are excluded from the computation of ~~$2,103,981 and used cash in operating activities of $1,372,589 for the nine months ended September 30, 2017.~~ diluted earnings per share.

Segment Information

The Company ~~had an accumulated deficit of $10,928,787 at September 30, 2017. These factors raise substantial doubt about the ability of the Company to continue as a going concern for a reasonable period of time.~~currently operates in one reporting segment. The Company's continuation as a going concern is dependent upon its ability to generate revenues and its ability to continue receiving investment capital and loans from related parties to sustain its current level of operations.

~~Management plans to continue to raise additional capital through private placements and is exploring additional avenues for future fund-raising through both public and private sources.~~

The condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

~~BRIGHT MOUNTAIN MEDIA, INC., AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~SEPTEMBER 30, 2017~~

~~(Unaudited)~~

~~NOTE 3 – ACQUISITIONS.~~

On January 2, 2016, the Company closed the acquisition of warisboring.com pursuant to the terms and conditions of the Website Asset Purchase Agreement dated December 4, 2015 for an aggregate purchase price of $250,000. The purchase price consisted of a cash payment of $100,000 at the January 4, 2016 closing and the balance of $150,000, payable monthly in an amount equal to 30% of the net revenues from the website, when collected, with the total amount of the earn out to be paid by January 4, 2019. The Company recorded the future monthly payments totaling $150,000 at a present value of $117,268, net of discount of $32,732. The present value was calculated at a discount rate of 12% (which is the Company’s then most recent borrowing rate) using the estimated future revenues from the website to estimate the payment dates. The estimated future revenues from the website were based on the average historical monthly revenues from the website prior to the Company’s acquisition. During the nine months ended September 30, 2017 and 2016, the Company amortized $8,183 and $8,184, respectively, of this discount. The acquisition was accounted following ASC 805 “~~Business Combinations~~.” Under the purchase method of accounting, the transaction was valued for accounting purposes at $217,268, which was the fair value of warisboring.com. The Company has initially determined there was only two amortizable intangible assets. The acquisition date estimated fair value of the consideration transferred consisted of the following:

Customer and related relationships

$
39,578

Website

177,690

Total

$
217,268

The above estimated fair value of the intangible assets is based on a preliminary purchase price allocation prepared by management. As a result, during the preliminary purchase price allocation period, which may be up to one year from the business combination date, we may record adjustments to the asset acquired, with the corresponding offset to website. After the preliminary purchase price allocation period, we record adjustments to assets acquired subsequent to the purchase price allocation period in our operating results in the period in which the adjustments were determined. In the year following this transaction, we did not record any adjustments to our initial allocations.

~~On February 2, 2016, the Company entered into a Website Asset Purchase Agreement with unrelated third parties for a purchase price of $15,000 in cash. The acquisition was accounted for following ASC~~~~805 "Business Combinations."~~ The operations of the website prior to the Company's acquisition were immaterial; therefore, pro forma information was not presented. There were no costs of acquisition incurred as a result of this purchase.

On December 16, 2016, with an effective date of December 15, 2016 under the terms of the Asset Purchase Agreement, we acquired the assets constituting the Black Helmet Apparel business from Sostre Enterprises, Inc., including various website properties and content, social media content, inventory and other intellectual property rights. The consideration for the acquisition consisted of $250,000 in cash, 200,000 shares of our common stock valued at $170,000, the assumption of $40,000 in liabilities and the forgiveness of working capital advances we had previously made to the seller totaling $200,000.

~~A summary of assets acquired is as follows:~~

Inventory

$
58,000

Intangibles – website

80,000

Intangibles – trade name

150,000

Intangibles – customer relationships

252,000

Intangibles – non-compete agreements

120,000

Total assets acquired

$
660,000

~~BRIGHT MOUNTAIN MEDIA, INC., AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~SEPTEMBER 30, 2017~~

~~(Unaudited)~~

~~NOTE 3 – ACQUISITIONS (continued).~~

~~Pro forma results~~

The following table sets forth a summary of the unaudited pro forma results of the Company as if the acquisition of the assets constituting the Black Helmet Apparel business which was closed in December 2016 and the acquisition of Daily Engage Media which closed in September 2017, had taken place on the first day of the periods presented. These combined results are not necessarily indicative of the results that may have been achieved had the assets been acquired as of the first day of the periods presented.

Three Months
Ended

Nine Months
Ended

September 30,

September 30,

2016

2016

Total revenue

$
925,691

$
2,416,562

Total expenses

1,989,494

5,064,116

Preferred stock dividend

60,339

278,525

Net loss attributable to common shareholders

$
(1,124,142
)

$
(2,926,079
)
Basic and diluted net loss per share

$
(0.03
)

$
(0.07
)

~~At September 30, 2017 and December 31, 2016, respectively, intangible assets consisted of the following:~~

September 30,

December 31,

2017

2016

Intangible Assets

$
2,040,239

$
1,739,179

Less: Accumulated Amortization

(617,443
)

(581,045
)
Less: Impairment Loss

(191,020
)

(191,020
)
Intangible Assets, net

$
1,231,776

$
967,114

~~Non-cash amortization expense for the three and nine month periods ending September 30, 2017 and 2016 was $75,876 and $61,582, respectively and $227,418 and $186,007, respectively.~~

~~In connection with the acquisition of the Black Helmet Apparel business, the Company recognized $150,000 attributable to tradenames acquired.~~

On March 3, 2017 the Company entered into a Membership Interest Purchase Agreement with Daily Engage Media, and its members Harry G. Pagoulatos, George G. Rezitis and Angelos Triantafillou (collectively, the "Members"). On September 19, 2017 the parties entered into an Amended and Restated Membership Interest Purchase Agreement which modified certain terms of the original agreement. The original agreement, as amended, is referred to as the "Daily Engage Purchase Agreement." Following the execution of the amendment, on September 19, 2017 the parties closed the transaction pursuant to which the Company acquired 100% of the membership interests of Daily Engage Media in exchange for the following consideration:

~~$380,000 paid through the delivery of unsecured, interest free, one year promissory notes (the "Closing Notes");~~

~~an aggregate of 1,100,223 shares of our common stock valued at $429,091 (the "Consideration Shares"); and~~

~~the forgiveness of $204,411 in working capital we had previously advanced Daily Engage Media.~~

~~BRIGHT MOUNTAIN MEDIA, INC., AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~SEPTEMBER 30, 2017~~

~~(Unaudited)~~

~~NOTE 3 – ACQUISITIONS (continued).~~

At the request of the Members and included as part of the Closing Notes and Consideration Shares, a portion of the closing consideration, including an $80,000 principal amount Closing Note together with 275,058 Consideration Shares, were issued to Mr. Vinay Belani, a third party with whom Daily Engage Media has a business relationship and are included in the above figures

~~Under the terms of the Daily Engage Purchase Agreement, upon Daily Engage Media achieving certain revenue and operating income tests, we agreed to issue additional consideration as follows:~~

if Daily Engage Media's revenues are at least $20,228,954, and it has operating income of at least $3,518,623 (the "Year-One Daily Engage Target") during the first 12 months following the closing date (the "Year-One Earn out Period") as determined by us in accordance with GAAP, we agreed to pay the Members and Mr. Belani collectively an additional $500,000 in cash and issue an additional 1,008,547 shares of our common stock (the "Year-One Earn out Shares");

if Daily Engage Media's revenues are at least $60,385,952, and operating income of at least $11,380,396 (the "Year-Two Daily Engage Target") during the first 12 months following the Year-One Earnout Period (the "Year-Two Earnout Period") as determined by us in accordance with GAAP, we agreed to pay the Members and Mr. Belani an additional $500,000 in cash and issue an additional 796,221 shares of our common stock (the "Year-Two Earnout Shares"). In addition, if the Year-Two Daily Engage Target is met, at the time of payment of the Year-Two Earnout Shares and the year-two earnout cash, the Members and Mr. Belani collectively will also be entitled to receive the Year-One Earnout Shares and the year-one earnout cash to the extent not previously received; and

if Daily Engage Media's revenues are at least $96,512,204, and it has operating income of at least $18,524,967 (the "Year-Three Daily Engage Target") during the 12 months following the Year-Two Earnout Period (the "Year-Three Earnout Period") as determined by us in accordance with GAAP, we agreed to pay the Members and Mr. Belani an additional $550,000 in cash and issue an additional 723,523 shares of our common stock (the "Year-Three Earnout Shares"). In addition, if the Year-Three Daily Engage Target is met, at the time of payment of the Year-Three Earnout Shares and the year-three earnout cash, the Members and Mr. Belani collectively will also be entitled to receive the Year-One Earnout Shares, the year-one earnout cash, the Year-Two Earnout Shares and the year-two earnout cash, to the extent not previously received.

The final accounting for the acquisition of Daily Engage Media has not been completed and will be completed during the first quarter of 2018. The preliminary allocation of the purchase price to the assets acquired and liabilities assumed based on the estimated fair values is as follows:

Tangible assets acquired

$
106,534

Liabilities assumed

(237,855
)
Exchange platform

50,000

Tradename

150,000

Customer relationships

250,000

Non-compete agreements

192,000

Goodwill

502,823

Total purchase price

$
1,013,502

~~At this time we do not expect that goodwill will be tax deductible.~~

~~BRIGHT MOUNTAIN MEDIA, INC., AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~SEPTEMBER 30, 2017~~

~~(Unaudited)~~

~~NOTE 4 – INVENTORIES.~~

~~At September 30, 2017 and December 31, 2016 inventories consisted of the following:~~

September 30,

December 31,

2017

2016

Product inventory: clocks and watches

$
788,851

$
982,283

Product inventory: Black Helmet Apparel and GoPoliceBlotter.com

195,671

144,789

Total inventory balance

$
984,522

$
1,127,072

~~NOTE 5 – PREPAID COSTS AND EXPENSES.~~

~~At September 30, 2017 and December 31, 2016, prepaid expenses and other current assets consisted of the following:~~

September 30,

December 31,

2017

2016

Prepaid rent

$
27,199

$
46,523

Prepaid insurance

18,885

84,825

Prepaid expense

15,529

—

Prepaid inventory

10,114

1,602

Prepaid Expenses and Other Current Assets

$
71,727

$
132,950

~~NOTE 6 – PROPERTY AND EQUIPMENT.~~

~~At September 30, 2017 and December 31, 2016, property and equipment consisted of the following:~~

September 30,

December 31,

Depreciable Life

2017

2016

(Years)

Furniture and Fixtures

$
76,671

$
70,108

7

Computer Equipment

59,511

56,142

5

Leasehold Improvements

39,385

35,011

10

Total Fixed Assets

175,567

161,261

Less: Accumulated Depreciation

(81,185
)

(62,260
)

Total Fixed Assets, net

$
94,382

$
99,001

Non-cash depreciation expense for the three and nine months ending September 30, 2017, respectively, and was $6,777 and $18,925 and $3,346 and $10,025 for the three and nine months ended September 30, 2016, respectively.

~~NOTE 7 – SEGMENT INFORMATION.~~

The Company has two identifiable segments as of September 30, 2017; products and advertising. The products segment sells merchandise directly to customers thorough e-commerce distributor portals such as Amazon and eBay and through our proprietary websites and retail location. The advertisingservices segment is focused on producing advertising revenue generated by users “clicking” on website advertisements utilizing several ad network partners, and direct ~~advertisers.~~advertisers and subscription revenue generated by the sale of access to career postings on one of our websites; however, the latter is insignificant.

Recent Accounting Pronouncements

In June 2016, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2016-13 (amended by ASU 2019-10), “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, regarding the measurement of credit losses for certain financial instruments.” which replaces the incurred loss model with a current expected credit loss (“CECL”) model. The ~~following~~CECL model is based on historical experience, adjusted for current conditions and reasonable and supportable forecasts. The Company is required to adopt the new guidance on January 1, 2023. The Company is currently evaluating the impact this guidance will have on the consolidated financial statements.

In January 2017, the FASB issued Accounting Standards Update (“ASU”) No. 2017-04 (amended by ASU 2019-10), “Intangibles – Goodwill and other (Topic 350): Simplifying the Test for Goodwill Impairment.” Which simplifies the test for goodwill impairment by removing the second step of the test. There is a one-step qualitative test and does not amend the optional qualitative assessment of goodwill impairment. The new standard is effective January 1, 2023 and is not expected to have a material impact on the Company’s consolidated financial statements.

In August 2020, the FASB issued ASU 2020-06, “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40)”. The ASU simplifies the accounting for certain financial instruments with characteristics of liabilities and equity. The FASB reduced the number of accounting models for convertible debt and convertible preferred stock instruments and made certain disclosure amendments to improve the information ~~represents segment activity for~~provided to users. The new standard is effective January 1, 2024 (early adoption is permitted, but not earlier than January 1, 2021). The Company is currently evaluating the ~~three and nine month periods ended September 30, 2017 and 2016.~~impact on the Company’s consolidated financial statements.

For the three months ended
September 30, 2017

For the three months ended
September 30, 2016

Products

Advertising

Total

Products

Advertising

Total

Revenues

$
589,402

$
131,233

$
720,625

$
292,235

$
113,502

$
405,737

Intangible assets amortization

$
—

$
75,876

$
75,876

$
—

$
61,582

$
61,582

Depreciation

$
6,440

$
337

$
6,777

$
2,426

$
920

$
3,346

Income/(Loss) from operations

$
(541,619
)

$
69,181

$
(472,438
)

$
(300,803
)

$
(210,479
)

$
(511,282
)
Segment assets

$
1,429,824

$
2,151,591

$
3,581,415

$
1,352,158

$
856,317

$
2,208,475

Purchase of assets

$
—

$
199,573

$
199,573

$
29,415

$
11,688

$
41,103

BRIGHT MOUNTAIN MEDIA, INC., AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~SEPTEMBER 30, 2017~~March 31, 2022

~~(Unaudited)~~(unaudited)

In March 2020, the FASB issued ASU No. 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting” which provides optional expedient and exceptions for applying generally accepted accounting principles to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. In response to the concerns about structural risks of interbank offered rates (“IBORs”) and, particularly, the risk of cessation of the LIBOR, regulators in several jurisdictions around the world have undertaken reference rate reform initiatives to identify alternative reference rates that are more observable or transaction based and less susceptible to manipulation. This accounting standards update provides companies with optional guidance to ease the potential accounting burden associated with transitioning away from reference rates that are expected to be discontinued. This new guidance may be adopted by the Company no later than December 1, 2022, with early adoption permitted. The potential adoption of this guidance is not expected to have a material impact on the consolidated financial statements.

NOTE 4 – PREPAID COSTS AND EXPENSES.

At March 31, 2022 and December 31, 2021, respectively, prepaid expenses and other current assets consisted of the following:

SCHEDULE OF PREPAID COSTS AND EXPENSES

	March 31, 2022		December 31, 2021
Prepaid insurance	$	300,423	$	427,461
Prepaid consulting service agreements – Spartan ⁽¹⁾		386,581		379,775
Prepaid software		127,025		-
Prepaid expenses – other		71,332		97,480
Prepaid expenses and other current assets	$	885,361	$	904,716

(1)

Spartan Capital is a broker-dealer that has assisted the Company with a range of services including capital raising activities, M&A advisory, and consulting services. The Company has a five-year agreement with Spartan Capital for the provision of such services and any prepayments made under the terms of this agreement starting October 2018 were capitalized and amortized over the remaining life of the agreement.

NOTE 5 – PROPERTY AND EQUIPMENT.

At March 31, 2022 and December 31, 2021, respectively, property and equipment consisted of the following:

SCHEDULE OF PROPERTY AND EQUIPMENT

	Estimated Useful Life (Years)	March 31, 2022			December 31, 2021
Furniture and fixtures	3-5	$	40,665		$	38,728
Computer equipment	3		123,880			176,624
Total property and equipment			164,545			215,352
Less: accumulated depreciation			(105,958	)		(150,230	)
Total property and equipment, net		$	58,587		$	65,122

Depreciation expense for the three months ended March 31, 2022 and 2021, was $3,385 and $18,047, respectively.

BRIGHT MOUNTAIN MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022

(unaudited)

NOTE 6 – WEBSITE ACQUISITION AND INTANGIBLE ASSETS.

At March 31, 2022 and December 31, 2021, respectively, website acquisitions, net consisted of the following:

SCHEDULE OF WEBSITE ACQUISITIONS, NET

	March 31, 2022			December 31, 2021
Website acquisition assets	$	1,124,846		$	1,124,846
Less: accumulated amortization		(920,850	)		(920,450	)
Less: cumulative impairment loss		(200,396	)		(200,396	)
Website Acquisition Assets, net	$	3,600		$	4,000

At March 31, 2022 and December 31, 2021, respectively, intangible assets, net consisted of the following:

SCHEDULE OF INTANGIBLE ASSETS

	Useful Lives	March 31, 2022			December 31, 2021
Trade name	5 years	$	3,749,600		$	3,749,600
Customer relationships	5 years		16,184,000			16,184,000
IP/Technology	5 years		7,223,000			7,223,000
Non-compete agreements	3-5 years		1,154,500			1,154,500
Total Intangible Assets		$	28,311,100		$	28,311,100
Less: accumulated amortization			(6,155,503	)		(5,759,636	)
Less: accumulated impairment loss			(16,486,929	)		(16,486,929	)
Intangible assets, net		$	5,668,668		$	6,064,535

Amortization expense for the three months ended March 31, 2022 and 2021 was $396,267 and $396,266, respectively, related to both the website acquisition costs and the intangible assets.

NOTE 7 – ~~SEGMENT INFORMATION (continued).~~GOODWILL

For the nine months ended
September 30, 2017

For the nine months ended
September 30, 2016

Products

Advertising

Total

Products

Advertising

Total

Revenues

$
1,713,688

$
334,856

$
2,048,544

$
976,056

$
313,266

$
1,289,322

Intangible assets amortization

$
—

$
227,418

$
227,418

$
—

$
186,007

$
186,007

Depreciation

$
16,725

$
2,200

$
18,925

$
8,299

$
1,726

$
10,025

Loss from operations

$
(1,386,894
)

$
(448,060
)

$
(1,834,954
)

$
(988,648
)

$
(665,623
)

$
(1,654,271
)
Segment assets

$
1,429,824

$
2,151,591

$
3,581,415

$
1,352,158

$
856,317

$
2,208,475

Purchase of assets

$
14,305

$
199,573

$
213,878

$
35,036

$
142,925

$
177,961

The following table represents the allocation of Goodwill as of December 31, 2021 and March 31, 2022:

SCHEDULE OF CHANGES GOODWILL

Owned &

Operated

Network

Total

December 31, 2021

9,725,559

9,919,909

19,645,468

March 31, 2022

9,725,559

9,919,909

19,645,468

Goodwill is tested for impairment at least annually and if triggering events are noted prior to the annual assessment. Impairment is deemed to occur when the carrying value of the Goodwill associated with the reporting unit exceeds the implied value of the Goodwill associated with the reporting unit. The periods ended March 31, 2022 and December 31, 2021 have been marked by the COVID-19 global pandemic when many companies in various industries were forced to restructure their advertising budgets and spending. This is evidenced by the reduced revenues from our customers in comparison with the 2019 year. The fair value of the respective reporting units was determined based on both the Income Approach (Discount Cash Flows) and the Market Multiples Approach.

BRIGHT MOUNTAIN MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022

(unaudited)

NOTE 8 – ACCRUED EXPENSES.

At March 31, 2022 and December 31, 2021, respectively, accrued expenses consisted of the following:

SCHEDULE OF ACCRUED EXPENSES

	March 31, 2022		December 31, 2021
Accrued salaries and benefits	$	1,259,169	$	1,459,299
Accrued dividends		691,450		691,861
Accrued traffic settlement⁽¹⁾		10,254		10,254
Accrued legal settlement⁽²⁾		216,101		81,101
Accrued legal fees		174,878		182,537
Accrued other professional fees		255,920		592,421
Share issuance liability⁽⁴⁾		27,012		189,067
Accrued warrant penalty⁽³⁾		366,899		366,899
Accrued Value-Added Tax payable		49,207		-
Other accrued expenses		155,318		191,226
Total accrued expenses	$	3,206,208	$	3,764,665

(1)	The Company negotiates with its publishing partners regarding questionable traffic to arrive at traffic settlements.
(2)	Accrued legal settlement related to the Encoding legal matter. See Note 10.
(3)	The Company has sold units of its securities to various investors in several private placements. As part of each private placement, the Company agreed to file a registration statement with the SEC to register the resale of the shares by the respective holder in order to permit the public resale; such filing deadlines ranged from 120 to 270 days following the closing date of the respective placement and the Company was liable to pay a penalty fee for failure to file the resale registration statement within the allotted timeframe.
(4)	Share issuance liability related to issuance of the Company’s common stock in connection with the Oceanside, MediaHouse and Wild Sky acquisitions and Oceanside employee share issuances.

NOTE 9 – NOTES ~~PAYABLE.~~PAYABLE

~~Long Term Debt~~Long-term debt to ~~Related Parties, net~~related parties

~~Following~~Centre Lane Partners Master Credit Fund II, L.P. (“Center Lane Partners”), who sold the ~~conversion~~Company the Wild Sky business in June 2020 has partnered and assisted the Company from a liquidity perspective starting in April 2021. This relationship has been determined to qualify as a related party. A related party is a party that can exercise significant influence over the Company in making financial and/or operating decisions.

Effective June 1, 2020, the Company entered into a membership interest purchase agreement to acquire 100% of Wild Sky (the “Purchase Agreement”). The seller issued a first lien senior secured credit facility totaling $16,451,905, which consisted of $15,000,000 of initial indebtedness, repayment of Wild Sky’s existing accounts receivable factoring facility of approximately $900,000 and approximately $500,000 of expenses. The note bears interest at a rate of 6.0% per annum. Per the credit facility with the seller, our loan payments begin December 1, 2021. There is no prepayment penalty associated with this credit facility. Certain future capital raises do require partial or full prepayments of the credit facility. The membership interest purchase included a requirement that the opinion of the financial statements as of and for the year ended December 31, 2021 not include a “going concern opinion.” The Company defaulted on this requirement and on April 26, 2021, the Company obtained a waiver of this requirement from the lender. This term loan shall be repaid by June 30, 2025, with payments of 2.5% of outstanding ~~notes~~principal beginning on June 30, 2023.

On April 26, 2021, the Company and certain of its subsidiaries entered into a First Amendment to Amended and Restated Senior Secured Credit Agreement (the “First Amendment”). The Company and its subsidiaries are parties to a credit agreement between itself and Centre Lane Partners as Administrative Agent and Collateral Agent dated June 5, 2020 (the “Credit Agreement”). The Credit Agreement was amended to permit the Company to raise up to $6,000,000 of total cash proceeds from the sale of its preferred stock prior to December 31, 2021 without having to make a mandatory prepayment of the loans (the “Loans”) under the Credit Agreement. The interest rate on the Loans after April 26, 2021 was increased to 10.00% per annum from 6.00%, which can continue to be paid in-kind in lieu of cash payment. In addition, the Company may issue up to $800,000 in dividends from the previous limit of $500,000 per annum. In addition, the Company has issued 150,000 common shares to Centre Lane Partners as part of this transaction. This term loan shall be repaid by June 30, 2025, with payments of 2.5% of outstanding principal beginning on June 30, 2023.

BRIGHT MOUNTAIN MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022

(unaudited)

On May 26, 2021, the Company and certain of its subsidiaries entered into a Second amendment to the Amended and Restated Senior Secured Credit Agreement between itself and Centre Lane Partners (“the Second Amendment”). The Company and its subsidiaries are parties to a credit agreement between itself and Centre Lane Partners as Administrative Agent and Collateral Agent dated June 5, 2020, as amended the Credit Agreement. The Credit Agreement was amended to provide for an additional loan amount of $1.5 million, in the aggregate. This term loan shall be repaid by June 30, 2025, with payments of 2.5% of outstanding principal beginning on June 30, 2023. In addition, and as part of the transaction, there is an Exit Fee (“the Exit Fee”) totaling $0.750 million which will be added and capitalized to the principal amount of the original loan and the original loan terms apply. In addition, the Company has issued 3.0 million common shares to Centre Lane Partners as part of this transaction.

On August ~~2016,~~12, 2021, the Company and certain of its subsidiaries entered into a Third amendment to the Amended and Restated Senior Secured Credit Agreement between itself and Centre Lane Partners (“the Third Amendment”). The Company and its subsidiaries are parties to a credit agreement between itself and Centre Lane Partners as Administrative Agent and Collateral Agent dated June 5, 2020, as amended the Credit Agreement. The Credit Agreement was amended to provide for an additional loan amount of $0.5 million, in the aggregate. This term loan shall be repaid by June 30, 2025, with payments of 2.5% of outstanding principal beginning on June 30, 2023. In addition, and as part of the transaction, there is an Exit Fee (“the Exit Fee”) totaling $0.250 million which will be added and capitalized to the principal amount of the original loan and the original loan terms apply. In addition, the Company has issued 2.0 million common shares to Centre Lane Partners as part of this transaction.

On August 31, 2021, the Company and certain of its subsidiaries entered into a Fourth amendment to the Amended and Restated Senior Secured Credit Agreement between itself and Centre Lane Partners (“the Fourth Amendment”). The Company and its subsidiaries are parties to a credit agreement between itself and Centre Lane Partners as Administrative Agent and Collateral Agent dated June 5, 2020, as amended the Credit Agreement. The Credit Agreement was amended to provide for an additional loan amount of $1.1 million, in the aggregate. This term loan shall be repaid by June 30, 2025, with payments of 2.5% of outstanding principal beginning on June 30, 2023. In addition, and as part of the transaction, there is an Exit Fee (“the Exit Fee”) totaling $0.550 million which will be added and capitalized to the principal amount of the original loan and the original loan terms apply. There was no issuance of common shares as part of this amendment.

On October 8, 2021, the Company and certain of its subsidiaries entered into a Fifth amendment to the Amended and Restated Senior Secured Credit Agreement between itself and Centre Lane Partners (“the Fifth Amendment”). The Company and its subsidiaries are parties to a credit agreement between itself and Centre Lane Partners as Administrative Agent and Collateral Agent dated June 5, 2020, as amended the Credit Agreement. The Credit Agreement was amended to provide for an additional loan amount of $725,000, in the aggregate. This term loan shall be repaid by June 30, 2025, with payments of 2.5% of outstanding principal beginning on June 30, 2023. In addition, and as part of the transaction, there is an Exit Fee (“the Exit Fee”) totaling $800,000 which will be added and capitalized to the principal amount of the original loan and the original loan terms apply. There was no issuance of common shares as part of this amendment.

On November 5, 2021, the Company and certain of its subsidiaries entered into a Sixth amendment to the Amended and Restated Senior Secured Credit Agreement between itself and Centre Lane Partners (“the Sixth Amendment”). The Company and its subsidiaries are parties to a credit agreement between itself and Centre Lane Partners as Administrative Agent and Collateral Agent dated June 5, 2020, as amended the Credit Agreement. The Credit Agreement was amended to provide for an additional loan amount of $800,000, in the aggregate. This term loan shall be repaid by June 30, 2025, with payments of 2.5% of outstanding principal beginning on June 30, 2023. In addition, and as part of the transaction, there is an Exit Fee (“the Exit Fee”) totaling $800,000 which will be added and capitalized to the principal amount of the original loan and the original loan terms apply. This amendment required the Company to issue 7,500,000 shares of the Company’s common stock to Centre Lane Partners prior to November 30, 2021.

BRIGHT MOUNTAIN MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022

(unaudited)

On December 23, 2021, the Company and certain of its subsidiaries entered into a Seventh amendment to the Amended and Restated Senior Secured Credit Agreement between itself and Centre Lane Partners (“the Seventh Amendment”). The Company and its subsidiaries are parties to a credit agreement between itself and Centre Lane Partners as Administrative Agent and Collateral Agent dated June 5, 2020, as amended the Credit Agreement. The Credit Agreement was amended to provide for an additional loan amount of $500,000, in the aggregate. This term loan shall be repaid by June 30, 2025, with payments of 2.5% of outstanding principal beginning on June 30, 2023. In addition, and as part of the transaction, there is an Exit Fee (“the Exit Fee”) totaling $500,000 which will be added and capitalized to the principal amount of the original loan and the original loan terms apply. There was no issuance of common shares as part of this amendment.

On January 26, 2022, the Company and certain of its subsidiaries entered into a Eighth amendment to the Amended and Restated Senior Secured Credit Agreement between itself and Centre Lane Partners (“the Eighth Amendment”). The Company and its subsidiaries are parties to a credit agreement between itself and Centre Lane Partners as Administrative Agent and Collateral Agent dated June 5, 2020, as amended the Credit Agreement. The Credit Agreement was amended to provide for an additional loan amount of $350,000, in the aggregate. This term loan shall be repaid by June 30, 2025, with payments of 2.5% of outstanding principal beginning on June 30, 2023. In addition, and as part of the transaction, there is an Exit Fee (“the Exit Fee”) totaling $350,000 which will be added and capitalized to the principal amount of the original loan and the original loan terms apply. There was no issuance of common shares as part of this amendment.

On February 11, 2022, the Company and certain of its subsidiaries entered into a Ninth amendment to the Amended and Restated Senior Secured Credit Agreement between itself and Centre Lane Partners (“the Ninth Amendment”). The Company and its subsidiaries are parties to a credit agreement between itself and Centre Lane Partners as Administrative Agent and Collateral Agent dated June 5, 2020, as amended the Credit Agreement. The Credit Agreement was amended to provide for an additional loan amount of $250,000, in the aggregate. This term loan shall be repaid by June 30, 2023. In addition, and as part of the transaction, there is an Exit Fee (“the Exit Fee”) totaling $12,500 which will be added and capitalized to the principal amount of the original loan and the original loan terms apply. There was no issuance of common shares as part of this amendment. Per the tenth amendment to the Amended and Restated Senior Secured Credit Agreement between itself and Centre Lane Partners, the interest rate on this term loan was increased to 12% from 10%

On March 11, 2022, the Company and certain of its subsidiaries entered into a Tenth amendment to the Amended and Restated Senior Secured Credit Agreement between itself and Centre Lane Partners (“the Tenth Amendment”). The Company and its subsidiaries are parties to a credit agreement between itself and Centre Lane Partners as Administrative Agent and Collateral Agent dated June 5, 2020, as amended the Credit Agreement. The Credit Agreement was amended to provide for an additional loan amount of $300,000, in the aggregate. This term loan shall be repaid by June 30, 2023. In addition, and as part of the transaction, there is an Exit Fee (“the Exit Fee”) totaling $15,000 which will be added and capitalized to the principal amount of the original loan and the original loan terms apply. There was no issuance of common shares as part of this amendment. Additionally, per the Tenth Amendment, original loan and amendments one through eight now have maturity dates of June 30, 2025, with quarterly payments of 2.5% of outstanding principal beginning on June 30, 2023. Amendments nine through fourteen have a maturity date of June 30, 2023.

On March 25, 2022, the Company and certain of its subsidiaries entered into an Eleventh amendment to the Amended and Restated Senior Secured Credit Agreement between itself and Centre Lane Partners (“the Eleventh Amendment”). The Company and its subsidiaries are parties to a credit agreement between itself and Centre Lane Partners as Administrative Agent and Collateral Agent dated June 5, 2020, as amended the Credit Agreement. The Credit Agreement was amended to provide for an additional loan amount of $500,000, in the aggregate. This term loan shall be repaid by June 30, 2023. In addition, and as part of the transaction, there is an Exit Fee (“the Exit Fee”) totaling $25,000 which will be added and capitalized to the principal amount of the original loan and the original loan terms apply. There was no issuance of common shares as part of this amendment. See Note 15 for amendments to the Amended and Restated Senior Secured Credit Agreement subsequent to March 31, 2022.

BRIGHT MOUNTAIN MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022

(unaudited)

As part of these transactions and given that Centre Lane was determined to be a related party, an independent fair value analysis was performed by the Company and all related transactions were recorded accordingly. As of the First Amendment dated April 26, 2021, the Company evaluated the debt for extinguishment or debt modification under FASB ASC Topic 470-50, Debt – Modifications and Extinguishments, and determined extinguishment was applicable. Under the rules, the Company extinguished the debt, which included the capitalized interest through April 26, 2021, and recorded it net of the debt discount, including all applicable fees and stock issuances. The debt discount determined for the First Amendment totaled $2,363,986 and is amortized over the remaining life of the loan and is included in interest expense – related party on the accompanying consolidated statement of operations and comprehensive loss or until the next debt modification or extinguishment is determined. For the Second Amendment, which occurred on May 26, 2021, the Company determined it was a debt modification. The Second Amendment provided the Company with debt financing of $1,500,000, an Exit fee of $750,000, and issuance of 3,000,000 shares of common stock issued to Centre Lane. The debt discount determined for the Second Amendment totaled $904,637. For the Third Amendment, which occurred on August 12, 2021, the Company determined it was a debt modification. The Third Amendment provided the Company with debt financing of $500,000, an Exit fee of $250,000, and issuance of 2,000,000 shares of common stock issued to Centre Lane. The debt discount determined for the Third Amendment totaled $322,529. For the Fourth Amendment, which occurred on August 31, 2021, the Company determined it was a debt modification. The Fourth Amendment provided the Company with debt financing of $1,100,000, an Exit fee of $550,000, and no common share issuance. The debt discount determined for the Fourth Amendment totaled $560,783. For the Fifth Amendment, which occurred on October 8, 2021, the Company determined it was a debt extinguishment. The Fifth Amendment provided the Company with debt financing of $725,000, an Exit fee of $362,500, and no common share issuance. The debt discount determined for the Fifth Amendment totaled $2,635,013. For the Sixth Amendment, which occurred on November 5, 2021, the Company determined it was a debt modification. The Sixth Amendment provided the Company with debt financing of $800,000, an Exit fee of $800,000, and no common share issuance. The debt discount determined for the Sixth Amendment totaled $902,745. For the Seventh Amendment, which occurred on December 23, 2021, the Company determined it was a debt modification. The Seventh Amendment provided the Company with debt financing of $500,000, an Exit fee of $500,000, and no common share issuance. The debt discount determined for the Seventh Amendment totaled $510,783. For the Eight Amendment, which occurred on January 26, 2022, the Company determined it was a debt modification. The Eighth Amendment provided the Company with debt financing of $350,000, an Exit fee of $350,000, and no common share issuance. The debt discount determined for the Eighth Amendment totaled $352,520. For the Ninth Amendment, which occurred on February 11, 2022, the Company determined it was a debt modification. The Ninth Amendment provided the Company with debt financing of $250,000, an Exit fee of $12,500, and no common share issuance. The debt discount determined for the Ninth Amendment totaled $19,700. For the Tenth Amendment, which occurred on March 11, 2022, the Company determined it was a debt modification. The Tenth Amendment provided the Company with debt financing of $300,000, an Exit fee of $15,000, and no common share issuance. The debt discount determined for the Sixth Amendment totaled $25,125. For the Eleventh Amendment, which occurred on March 25, 2022, the Company determined it was a debt modification. The Eleventh Amendment provided the Company with debt financing of $500,000, an Exit fee of $25,000, and no common share issuance. The debt discount determined for the Eleventh Amendment totaled $29,050.

The accumulated gross debt discount as of March 31, 2022 and December 31, 2021 totaled $8,626,871 and $8,200,476, respectively and will be amortized into the condensed consolidated statement of operations and comprehensive loss and included in the interest expense – related party over the remaining life of the loan or until the next debt modification or extinguishment is determined. Interest expense for note payable to related party for the three months ended March 31, 2022 and 2021 was $804,129 and $255,506, respectively.

On July 31, 2019, the Company executed a Share Exchange Agreement and Plan of Merger (the “Oceanside Merger Agreement”) with Slutzky & Winshman Ltd., an Israeli company (“Oceanside”) and the shareholders of Oceanside (the “Oceanside Shareholders”). The merger closed on August 15, 2019, and the Company acquired all of the outstanding shares of S&W. Pursuant to the terms of the Merger Agreement, the Company issued 12,513,227 shares valued at $20,021,163 to owners and employees of Oceanside and contingent consideration of $750,000 paid through the delivery of unsecured, interest free, one and two-year promissory notes (the “Closing Notes”). At the time of the acquisition and under FASB ASC Topic 805, Business Combinations (“ASC 805”), these Closing Notes were recorded ratably as compensation expense into the statement of operations and comprehensive loss over the 24-month term and an accrued payable is being recognized over the same period. As of August 15, 2020, the Company did not make payment on the one year closing note and thereby defaulted on its obligation and the two-year closing note accelerated to become payable as of August 15, 2020. Upon default, the closing notes accrue interest at a ~~series~~1.5% per month rate, or 18% annual rate. As a result, there was a total charge of ~~12%,~~$300,672 recorded during the third quarter of 2020 which was $250,000 of compensation expense and $50,672 of interest expense-related party. The total $750,000liability is recorded in accrued expenses. Interest expense for note payable to related party for the three months ended March 31, 2022 and 2021 was $33,288.

BRIGHT MOUNTAIN MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022

(unaudited)

During November 2018, the Company issued 10%~~, and 6%~~ convertible promissory notes ~~that have conversion prices that create a beneficial conversion~~in the amount of $80,000 to a related party, ~~who is our Chief Executive Officer. These~~the Chairman of the Board. The notes mature five years from issuance and ~~are~~is convertible at the option of the holder into shares of common stock at any time prior to maturity at a conversion ~~prices~~price of ~~$0.40 or $0.50~~$0.40 per share. A beneficial conversion feature exists on the date athe convertible ~~note is~~notes were issued ~~when~~whereby the fair value of the underlying common stock to which the ~~note is~~notes are convertible into is in excess of the face value of the ~~note. In accordance with this guidance, the intrinsic value~~note of $70,000.

The principal balance of these notes payable was $80,000 at March 31, 2022 and December 31, 2021, and discounts recognized upon respective origination dates as a result of the beneficial conversion ~~features is recorded as a debt discount with a corresponding amount~~feature total $22,819 and $26,271, respectively. At March 31, 2022 and December 31, 2021, the total convertible notes payable to ~~additional paid in capital. The debt discount is amortized to interest over the five-year life of the note using the effective interest method.~~

~~A summary of these note issuances to a~~ related party ~~at December~~net of discounts was $57,181 and $53,729, respectively. Interest expense for note payable to related party was $2,000 and discount amortization was $3,452 for the three months ended March 31, ~~2016~~2022 and ~~September 30, 2017 is as follows:~~2021.

Issuance Date

Maturity Date

Principal

Discount
Recognized

Amortization
Expense
2016

Carry
Amount at
December 31,
2016

Amortization
Nine Months
Ended
September 30,
2017

Carry
Amount at
September 30,
2017

09/26/16

09/26/21

$
100,000

$
70,000

$
3,692

$
33,692

$
10,500

$
44,192

10/14/16

10/14/21

100,000

70,000

3,024

33,024

10,500

43,524

10/31/16

10/31/21

100,000

70,000

2,372

32,372

10,500

42,872

11/03/16

11/03/21

50,000

35,000

1,120

16,120

5,250

21,370

11/11/16

11/11/21

100,000

70,000

1,934

31,934

10,500

42,434

11/21/16

11/21/21

50,000

35,000

775

15,775

5,250

21,025

12/15/16

12/15/21

75,000

52,500

488

22,988

7,874

30,864

01/19/17

01/19/22

100,000

70,000

—

—

9,823

39,823

02/06/17

02/06/22

100,000

70,000

—

—

9,061

39,061

02/24/17

02/24/22

50,000

35,000

—

—

3,708

18,708

03/07/17

03/07/22

100,000

70,000

—

—

7,941

37,941

04/03/17

04/03/22

75,000

45,000

—

—

4,500

34,500

04/10/17

04/10/22

75,000

45,000

—

—

4,250

34,250

04/19/17

04/19/22

50,000

30,000

—

—

2,683

22,683

05/01/17

05/01/22

50,000

30,000

—

—

2,500

22,500

05/11/17

05/11/22

75,000

22,500

—

—

1,742

54,242

05/24/17

05/24/22

75,000

45,000

—

—

3,484

33,484

06/08/17

06/08/22

100,000

30,000

—

—

1,883

71,883

06/27/17

06/27/22

100,000

30,000

—

—

1,567

71,567

07/12/17

07/12/22

50,000

5,000

—

—

220

45,220

Long-term debt

~~BRIGHT MOUNTAIN MEDIA, INC., AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~SEPTEMBER 30, 2017~~

~~(Unaudited)~~

~~NOTE 8 – NOTES PAYABLE (continued).~~

Issuance Date

Maturity Date

Principal

Discount
Recognized

Amortization
Expense
2016

Carry
Amount at
December 31,
2016

Amortization
Nine Months
Ended
September 30,
2017

Carry
Amount at
September 30,
2017

07/26/17

07/26/22

135,000

50,625

—

—

1,851

86,226

07/27/17

07/27/22

25,000

9,375

—

—

338

15,963

08/01/17

08/01/22

75,000

28,125

—

—

938

47,813

08/10/17

08/10/22

25,000

—

—

—

—

25,000

08/23/17

08/23/22

50,000

—

—

—

—

50,000

08/28/17

08/28/22

75,000

—

—

—

—

75,000

08/30/17

08/30/22

75,000

—

—

—

—

75,000

$
1,525,000

$
925,000

$
13,405

$
185,905

$
116,863

$
1,147,145

~~Amortization of debt discount totaled $116,863~~On February 17, 2021, under the Paycheck Protection Program (“PPP”) established by the Coronavirus Aid, Relief, and ~~$305,115 at September 30, 2017 and 2016, respectively.~~

~~Notes Payable~~

~~On November 30, 2016,~~Economic Security (“CARES”) Act, administered by the Small Business Administration (“SBA”), the Company entered into a promissory note ~~agreement~~of $295,600 with ~~an unaffiliated party in the principal amount of $500,000. The note is unsecured, carries an~~Regions Bank (the “Second Bright Mountain PPP Loan”) and has a two-year term and bears interest at a rate of ~~25%~~1.0% per ~~annum payable in arrears at maturity.~~annum. Monthly principal and interest payments are deferred for six months after the date of disbursement. The ~~note matures November 30, 2017 and~~Second Bright Mountain PPP Loan may be prepaid at any time ~~without notice or~~prior to maturity with no prepayment ~~penalty. In the event~~penalties. The Promissory Note contains customary events of default provisions. Under the terms of ~~any~~the CARES Act, PPP loan ~~provision, the lender~~recipients can ~~declare~~apply for and be granted forgiveness for all or ~~any~~a portion of loans granted under the ~~unpaid~~PPP. This was the second tranche available under the PPP program.

On March 23, 2021, under the Paycheck Protection Program (“PPP”) established by the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act, administered by the Small Business Administration (“SBA”), the Company’s Wild Sky subsidiary entered into a promissory note of $841,540 with Holcomb Bank (the “Second Wild Sky PPP Loan”) and has a two-year term and bears interest at a rate of 1.0% per annum. Monthly principal and interest ~~immediately due~~payments are deferred for six months after the date of disbursement. The Second Wild Sky PPP Loan may be prepaid at any time prior to maturity with no prepayment penalties. The Promissory Note contains customary events of default provisions. Under the terms of the CARES Act, PPP Loan recipients can apply for and ~~payable.~~

~~On September 30,2017, the note was amended, extending the maturity to December 31,2017 and reducing the interest rate to 10%. In addition, the note holder reduced the accrued interest due~~be granted forgiveness for all or a portion of loans granted under the PPP. This was the second tranche available under the PPP program and was forgiven as of March 23, 2022 and the Company recorded a non-cash gain on the PPP forgiveness during the three months ended March 31, 2022.

On April 24, 2020, under the Paycheck Protection Program (“PPP”) established by the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act, administered by the Small Business Administration (“SBA”), the Company entered into a promissory note ~~from approximately $106,000~~of $464,800 with Regions Bank (the “Bright Mountain PPP Loan”) and has a two-year term and bears interest at a rate of 1.0% per annum. Monthly principal and interest payments are deferred for six months after the date of disbursement. The PPP Loan may be prepaid at any time prior to ~~$50,000 at September 20,2017. This reduction in accrued interest~~maturity with no prepayment penalties. The Promissory Note contains customary events of ~~approximately $56,000 was taken in~~default provisions. Under the ~~third quarter of 2017. Accrued interest on this note totaled $50,347 at September 30, 2017.~~

~~As a part~~terms of the ~~acquisition~~CARES Act, PPP Loan recipients can apply for and be granted forgiveness for all or a portion of ~~Daily Engage Media~~loans granted under the PPP. On January 28, 2021, the Company applied for the promissory note to be forgiven by the SBA in whole or in part and on July 16, 2021, the Company obtained the forgiveness of the Bright Mountain PPP Loan in whole and recorded a non-cash gain on the PPP forgiveness during the year ended December 31, 2021.

Effective June 1, 2020, the Company acquired Wild Sky and assumed the $1,706,735 promissory note (the “Wild Sky PPP Loan”) with Holcomb Bank received under the PPP. The Wild Sky PPP Loan has a two ~~Notes Payable~~-year term and bears interest at a rate of 1.0% per annum. Monthly principal and interest payments are deferred for six months after the date of disbursement. The Wild Sky PPP Loan may be prepaid at any time prior to ~~Gibraltar Capital Advances, LLC~~maturity with no prepayment penalties. The Wild Sky PPP Loan contains customary events of default provisions. Under the terms of the CARES Act, PPP loan recipients can apply for and ~~Complete Business Solutions Group, Inc.~~be granted forgiveness for all or a portion of loans granted under the PPP. On January 22, 2021, the Company applied for the promissory note to be forgiven by the SBA in whole or in part and on March 29, 2021, the ~~amounts~~Company obtained the forgiveness of ~~$26,618~~the Wild Sky PPP Loan in whole and ~~$20,148,~~recorded a non-cash gain on the PPP forgiveness during the three months ended March 31, 2021.

BRIGHT MOUNTAIN MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022

(unaudited)

At March 31, 2022 and December 31, 2021, a summary of the Company’s debt is as follows:

SCHEDULE OF LONG-TERM DEBT

	March 31, 2022			December 31, 2021
Non-interest bearing BMLLC acquisition debt	$	-		$	250,000
PPP loans		295,600			1,137,140
Wild Sky acquisition debt		18,146,564			18,146,564
Centre Lane debt		9,990,000			8,187,500
Note payable debt to the Company’s Chairman of the Board		80,000			80,000
Total Debt		28,512,164			27,801,204
Less: debt discount, related party		(4,026,510	)		(3,880,093	)
Less: current portion of long-term debt		(295,600	)		(1,387,140	)
Less: current portion of long-term debt, related party		-			(7,316,402	)
Long term debt to related parties, net and long term debt	$	24,190,054		$	15,217,569

Interest expense was $839,417 and $290,794 for the three months ended March 31, 2022 and 2021, respectively.

The minimum annual principal payments of notes payable at March 31, 2022 were:

SCHEDULE OF MATURITIES OF LONG-TERM OBLIGATION

For the Twelve Months Ending:
2022 (remainder of the year)	$	110,158
2023		3,307,956
2024		2,450,545
2025		22,643,505
Total	$	28,512,164

Premium Finance Loan Payable

The Company ~~also issued promissory~~generally finances its annual insurance premiums through the use of short-term notes, payable in 10 equal monthly installments. Coverages financed include Directors and Officers and Errors and Omissions with premiums financed in 2021 and 2020 of $406,522 and $380,397, respectively.

Total Premium Finance Loan Payable balance for the ~~amount of $380,000 payable to three Daily Engage Media members~~Company’s policies was $212,178 at March 31, 2022 and ~~a third party, with whom they have a business relationship. The notes mature on September 19, 2018.~~$334,284 at December 31, 2021.

NOTE 910 – COMMITMENTS AND ~~CONTINGENCIES.~~CONTINGENCIES.

~~Leases~~

The Company leases its corporate offices at 6400 Congress Avenue, Suite 2050, Boca Raton, Florida 33487 under a long-term non-cancellable operating lease agreement ~~which contains renewal options.~~expiring on October 31, 2021. The lease which was entered into on August 25, 2014 was amended on July 30, 2015 to increase the original approximate 2,014 square feet to approximately 4,450 square feet. The term of the lease was extended and will terminate on March 14, 2019 at a currentterms require base rent ~~of for a term~~payments of approximately ~~$8,978~~$7,260 plus sales tax per month for the first twelve months commencing in September 2018, with a 3%3% escalation each year. ~~An additional~~Included in other assets is a required security deposit of ~~$2,500 was required.~~$18,100. Rent is all-inclusive and includes electricity, heat, air-conditioning, and water. ~~The original rent commencement date was October 11, 2014 and will expire on March 14, 2019.~~

The Company ~~leases retail~~had one lease for office space which expired in October 2021. The Company currently utilizes this office space under a month-to-month agreement. The Company signed a new lease agreement in June 2022. See Note 15 Subsequent events for more information. The Company’s non-lease components are primarily related to property maintenance and other operating services, which varies based on future outcomes and is recognized in rent expense when incurred and not included in the measurement of the lease liability. The Company did not have any variable lease payments for its ~~product sales division at 4900 Linton Boulevard, Bay 17A, Delray Beach, FL 33445 under a long-term, non-cancellable~~operating lease agreement, which contains renewal options. The lease, which was entered into on August 25, 2014, is for approximately 2,150 square feet for a term of 36 months in Delray Beach, Florida at a base rent of approximately $2,329 per month for the ~~first twelve~~three months ~~with a 3% escalation each year. A security deposit of $3,865, first month's prepaid rent of $3,865,~~ended March 31, 2022 and last month's prepaid rent of $4,015 was paid upon lease execution. The lease is a triple net lease. Common area maintenance is approximately $1,317 per month for the first twelve months with annual escalations not to exceed 4%. The rent commencement date was October 1, 2014 and was initially set to expire on September 30, 2017. In January 2017, this lease was modified and extended concurrent with the expansion of our retail space in the same location.2021.

BRIGHT MOUNTAIN MEDIA, INC., AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~SEPTEMBER 30, 2017~~March 31, 2022

~~(Unaudited)~~(unaudited)

Legal

~~NOTE 9 – COMMITMENTS AND CONTINGENCIES (continued).~~

~~In January 2017,~~From time-to-time, the Company entered into an additional lease and modified and extended our existing lease for our retail site. The new lease agreement provides for an additional 2,720 square feet adjacent to our existing Delray Beach FL location commencing February 1, 2017, and expiring January 31, 2022. This lease provides for one month’s free rent, an initial monthly base rental of $1,757, representing a one-half reduction in rental payments for the first year as an accommodation. Minimum base rental for year two is $3,513 per month, escalating 3% per year thereafter. The Company also provided a $10,000 security deposit and prepaid $96,940 in future rents on the facility through the funding of certain leasehold improvements. Prepaid rent totaled $56,199 at September 30, 2017. Simultaneously, the Company modified our existing lease on the initial space, extending this lease to coincide with the new space, expiring January 31, 2022, at an initial base rental of $2,471 per month, escalating 3% per year thereafter.

On December 16, 2016, with an effective date of December 15, 2016 under the terms of the Asset Purchase Agreement, we acquired the assets constituting the Black Helmet Apparel business including various website properties and content, social media content, inventory and other intellectual property rights. (See Note 3) We also acquired the right to assume the lease of their warehouse facility consisting of approximately 2,667 square feet. The lease was renewed for a three-year term in April 2016 with an initial base rental rate of $1,641 per month, and escalating at approximately 3% per year thereafter.

Rent expense for the three months ended September 30, 2017 and 2016 was $72,155 and $32,053, respectively and for the nine months ended September 30, 2017 and 2016 was $190,080 and $112,785, respectively.

~~Legal~~

~~From time-to-time, we~~ may be involved in litigation or be subject to claims arising out of our operations or content appearing on our websites in the normal course of business. Although the results of litigation and claims cannot be predicted with certainty, wethe Company currently ~~believe~~believes that the final outcome of these ordinary course matters will not have a material adverse effect on our business.

In 2020, Synacor, Inc commenced an action against MediaHouse, LLC, Inform, Inc. and the Company, alleging approximately $230,000 was owed based on invoices provided in 2019 in respect to that certain Content Provider & Advertising Agreement with MediaHouse. The Company has filed an answer and defenses and intends to defend the alleged claims. This is recorded as an accrued liability as of December 31, 2021. During January 2022, the Company entered into a settlement agreement related to the legal proceeding with Synacor. The agreement obligates the Company to pay $12,000 per month beginning January 24, 2022 for 12 consecutive months and then a final one-time payment in the amount of $40,000 to be paid on or before January 24, 2023. Notwithstanding, the Company has an early settlement option to pay-off the obligation with a discount if it pays $160,000 to Synacor on or before September 1, 2022, which amount shall be inclusive of the monthly installments previously mentioned prior to the date when early settlement payment is transmitted to Synacor.

A former employee of the Company filed a suit against the Company MediaHouse, Inc., and Gregory A. Peters, a former Executive, (the “Defendants”) alleging two counts of defamation. Any potential losses associated with this matter cannot be estimated at this time.

Bright Mountain has been sued by plaintiffs Joey Winshman, Eli Desatnik and Nadav Slutzy (“Plaintiffs”) in a lawsuit filed in the United States District Court for the Southern District of Florida on December 17, 2021 (the “Lawsuit”). Plaintiffs allege that BMM defaulted on its obligations to Plaintiffs under three promissory notes that arose from the merger between Bright Mountain Israel Acquisition Ltd., a wholly owned subsidiary of Bright Mountain, and Slutzky & Winshman Ltd. Plaintiffs seek to recover from Bright Mountain the principal balance of the promissory notes, interest, attorney’s fees, and costs. Discovery in the Lawsuit is underway and the parties continue to intermittently explore the possibility of settlement.

Encoding.com, Inc. (“Encoding”) was a former digital media customer of MediaHouse. Encoding had a long overdue outstanding receivable from MediaHouse’s predecessor company, Inform, Inc. MediaHouse did not assume the liability at acquisition. In 2020, the Company and Encoding agreed to settle the overdue receivable through the issuance of 175,000 warrants to purchase Company stock with a $1.00 exercise price. This was recorded as an accrued liability as of December 31, 2020 and the warrants were issued in 2021.

Regardless of the outcome, litigation can have an adverse impact on our company because of defense and settlement costs, diversion of management resources and other factors.

~~Other Commitments~~NOTE 11 – PREFERRED STOCK.

On August 31, 2021, W. Kip Speyer, the Company’s CEO, at that time, gave notice that all of his held preferred stock was converted in accordance with the original terms. Accordingly, 7,919,017 shares of the Company’s common stock is to be issued to Mr. Speyer. The Company ~~entered into various contracts or agreements~~notified the transfer agent on March 19, 2022 of the share issuance, and the issuance of the shares is a matter of administration. Management confirmed with SEC legal counsel that the shareholder rights have transferred at the time of the exercise notice. The Company considers the Common Shares issued and outstanding as of the date of the conversion notice. The Company recognizes the conversion of the preferred stock on August 31, 2021 and provides all rights as a common shareholder with regard to said shares to Mr. Speyer, including all voting rights. The Company confirms that there was no inducement to convert the shares and that the correct shares were issued in accordance with the ~~normal course~~original conversion terms. As of ~~business, which may contain commitments. During the nine months ended September 30, 2017 and 2016,~~said date, the Company ~~entered into agreements with third party vendors~~has an accrued dividend liability due to supply website content and data, website software development, advertising, public relations, and legal services. All of these commitments contain provisions whereby either party may terminate the agreement with specified notice, normally 30 days, and with no further obligation on the part of either party.Mr. W. Kip Speyer recorded totaling $691,450.

During the years ended December 31, 2016 and 2015, the Company entered into agreements with third parties related to websites acquired during the respective periods as further discussed in Note 3. In connection with the two acquisitions made in 2016, the Company entered into a management agreement associated with the WarIsBoring website at $5,000 per month through November 18, 2018, and two service agreements in connection the Black Helmet Apparel acquisition at $6,250 per month, each, through December 15, 2019, plus the ability to earn bonuses ranging from $50,000 for the year ending December 31, 2017 to $100,000 for the year ending December 31, 2019 each based upon the satisfaction of certain revenue and gross margin targets. These agreements may be terminated with six months written notice. Future contingent milestone payments under the acquisitions made in 2015 totaled approximately $210,000 and $210,000 for 2017 and 2016, respectively.

~~Total payments for the nine month periods ended September 30, 2017 and 2016 were $112,500 and $0, respectively.~~

~~Contractual commitments remaining under various acquisition related agreements total: $245,000 in 2017; $205,000 in 2018; $144,000 in 2019 and $0 for 2020 and 2021, respectively.~~

BRIGHT MOUNTAIN MEDIA, INC., AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~SEPTEMBER 30, 2017~~March 31, 2022

~~(Unaudited)~~(unaudited)

~~NOTE 9 – COMMITMENTS AND CONTINGENCIES (continued).~~

The Company entered into an Executive Employment Agreement with our Chief Executive Officer, with an effective date of June 1, 2014. Under the initial terms of this agreement, the Company would compensate the Chief Executive Officer with a base salary of $75,000 annually, and he is entitled to receive discretionary bonuses as may be awarded by the Company's board of directors from time to time. The initial term of the agreement is three years, and the Company may extend it for an additional one-year period upon written notice at least 180 days prior to the expiration of the term. The Chief Executive Officer's base annual salary was increased to $77,500 in January 2015, $96,000 in July 2015, and to $125,000 effective October 1, 2015 upon recommendation of the Compensation Committee of the board of directors. In May 2016 the Chief Executive Officer suggested and orally agreed to a voluntary reduction in his base salary to $95,000 per annum.

The agreement will terminate upon the Chief Executive Officer's death or disability. In the event of a termination upon his death, the Company is obligated to pay his beneficiary or estate an amount equal to one year base salary plus any earned bonus at the time of his death. In the event the agreement is terminated as a result of his disability, as defined in the agreement, he is entitled to continue to receive his base salary for a period of one year. The Company is also entitled to terminate the agreement either with or without case, and the Chief Executive Officer is entitled to voluntarily terminate the agreement upon one year's notice to the Company. In the event of a termination by the Company for cause, as defined in the agreement, or voluntarily by the Chief Executive Officer, the Company is obligated to pay him the base salary through the date of termination. In the event the Company terminates the agreement without cause, the Company is obligated to give him one years' notice of the Company's intent to terminate and, at the end of the one year period, pay an amount equal to two times his annual base salary together with any bonuses which may have been earned as of the date of termination. A constructive termination of the agreement will also occur if the Company materially breaches any term of the agreement or if a successor company to the Company fails to assume the Company's obligations under the employment agreement. In that event, the Chief Executive Officer will be entitled to the same compensation as if the Company terminated the agreement without cause. The employment agreement contains customary non-compete and confidentiality provisions. The Company also agreed to indemnify the Chief Executive Officer pursuant to the provisions of the Company's Amended and Restated Articles of Incorporation and Amended and Restated By-laws.

On April 1, 2017 the Company entered into the First Amendment to the Executive Employment Agreement with our Chief Executive Officer. Under the terms of the amendment, the term of his employment was extended to April 1, 2020, which may be further extended for additional one year periods upon 180 day’s notice by us to him. Under the terms of the amendment, Mr. Speyer's base salary was increased to $165,000 annually and he is entitled to earn annual performance bonuses, beginning with the year ending December 31, 2017, ranging from 25% to 80% of his base salary upon our achievement of certain annual revenue and EBITDA targets. All other terms and conditions of his employment agreement remain in full force.

On September 19, 2017 in connection with the closing of the acquisition of Daily Engage Media, we entered into three-year employment agreements with Messrs. Harry G. Pagoulatos and George G. Rezitis, two of the members. Mr. Pagoulatos and Mr. Rezitis will serve as chief operating officer and chief technology officer, respectively, of our Daily Engage Media Group. The terms of the employment agreements are identical except for the amount of base salary each individual will receive. We agreed to pay Mr. Pagoulatos an annual base salary of $60,000 during the first year of the term of his employment agreement, which increases to $75,000 annually for the remainder of the term. We agreed to pay Mr. Rezitis an annual base salary of $70,000 during the first year of the term of his employment agreement, which increases to $75,000 annually for the remainder of the term. Both employees are entitled to receive a discretionary bonus as may be awarded by our board of directors in their sole discretion, as well as participation in executive benefit programs we may offer, paid vacation and reimbursement for business expenses. The employment agreements may be terminated upon the death or disability of the employee, by us with or without cause or by the employee. If the employment agreement is terminated upon the employee's death or disability, we are obligated to continuing paying the base salary for a period of 60 days following termination. If the employment agreement is terminated by us for cause (as defined in the agreement) or by the employee, the employee is not entitled to receive any severance or other compensation after the date of termination. If we terminate the employment agreement without cause, we are obligated to pay the base salary and executive benefits for one year following the date of termination. The employment agreements contain customary confidentiality, non-compete and indemnification provisions.

~~BRIGHT MOUNTAIN MEDIA, INC., AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~SEPTEMBER 30, 2017~~

~~(Unaudited)~~

~~NOTE 10 – RELATED PARTIES.~~

As discussed more fully in Note 8, section titled “Long Term Debt to Related Parties, net”, in 2017 and 2016, the Company issued a series of convertible promissory notes to our Chief Executive Officer totaling $1,460,000 and $575,000, respectively. These notes have a conversion price ranging from $0.50 per share to $0.40 per share and resulted in the recognition of a beneficial conversion feature recorded as a debt discount. These notes payable, net of debt discount, total $1,147,145 and $185,905 at September 30, 2017 and December 31, 2016, respectively and mature five years from issuance and are convertible at the option of the holder into shares of common stock at any time prior to maturity at a conversion price of $0.50 per share. A beneficial conversion feature exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the face value of the note. In accordance with this guidance, the intrinsic value of the beneficial conversion features is recorded as a debt discount with a corresponding amount to additional paid in capital. The debt discount is amortized to interest over the five-year life of the note using the effective interest method. The notes are reported net of their unamortized debt discount of $887,855 and $389,095 as of September 30, 2017 and December 31, 2016, respectively.

In September 2017, Mr. W. Kip Speyer, the Company’s Chairman and Chief Executive Officer, purchased an aggregate of 500,000 shares of the Company’s Series E Convertible Preferred Stock at a purchase price of $0.40 per share. The designations, rights and preferences of Series E Stock are described in Note 11. The Company used the proceeds from these sales for working capital.

~~NOTE 11 – SHAREHOLDERS’ EQUITY.~~

~~Preferred Stock~~

The Company has authorized 20,000,000 shares of preferred stock with a par value of ~~$0.01~~$0.01 (the ~~"Preferred Stock"~~“Preferred Stock”), issuable in such series and with such designations, rights and preferences as the board of directors may determine. The ~~Company's~~Company’s board of directors has previously designated five series of preferred stock, consisting of 10% Series A Convertible Preferred Stock ("(“Series A ~~Stock"~~Stock”), 10% Series B Convertible Preferred Stock ("(“Series B ~~Stock"~~Stock”), 10% Series C Convertible Preferred Stock ("(“Series C ~~Stock"~~Stock”), 10% Series D Convertible Preferred Stock ("(“Series D ~~Stock"~~Stock”) and 10% Series E Convertible Preferred Stock ("(“Series E ~~Stock"~~Stock”). ~~At September 30, 2017, there were 100,000~~

The designations, rights and preferences of the Series F-1, Series F-2 and Series F-3 are identical, other than the dividend rate, liquidation preference and date of automatic conversion into shares of our common stock. The Series ~~A Stock~~F-1 pays dividends at the rate of 12% per annum and ~~500,000~~automatically converts into shares of our common stock on April 10, 2022. The Series F-2 pays dividends at the rate of 6% per annum and automatically converts into shares of our common on July 27, 2022. The Series F-3 pays dividends at the rate of 10% per annum and automatically converts into shares of our common stock on August 30, 2022. Additional terms of the designations, rights and preferences of the Series F-1, Series F-2 and Series F-3 include:

	●	the shares have no voting rights, except as may be provided under Florida law;

	●	the shares pay cash dividends subject to the provisions of Florida law at the dividend rates set forth above, payable monthly in arrears;

	●	the shares are convertible at any time at the option of the holder into shares of our common stock on a 1:1 basis. The conversion ratio is proportionally adjusted in the event of stock splits, recapitalization or similar corporate events. Any shares not previously converted will automatically convert into shares of our common stock on the dates set forth above;

	●	the shares rank junior to our 10% Series A Convertible Preferred Stock and our 10% Series E Convertible Preferred Stock;

	●	in the event of a liquidation or winding up of the Company, the shares have a liquidation preference of $0.50 per share for the Series F-1, $0.50 per share for the Series F-2 and $0.40 per share for the Series F-3; and

	●	the shares are not redeemable by the Company.

At both March 31, 2022 and December 31, 2021 125,000 shares of Series E Stock issued and outstanding. There are no shares of Series A-1 Stock, Series B Stock, Series B-1 Stock, Series C Stock, Series D or Series DF Stock issued and outstanding.

The Series A Stock is senior to all other classes of the Company's securities and has a stated value of $0.50 per share. Holders of shares of Series A Stock are entitled to the payment of a 10% dividend payable in shares of the Company’s common stock at a rate of one share of common stock for each 10 shares of Series A Stock, payable annually the 10th business day of January. The shares of Series A Stock are redeemable at the Company's option upon 20 days’ notice for an amount equal to the amount of capital invested. On August 18, 2016, Series A Stockholders converted 1,800,000 shares of Series A Stock into 1,800,000 shares of common stock, leaving 100,000 Series A Stock outstanding. On the 10th business day of January 2018 there were 7,205 shares of common stock dividends owed and payable to the Series A Stockholder of record as dividends on the Series A Stock.

On September 6, 2017, the board of directors designated 2,500,000 shares of Preferred Stock as Series E Stock, which such designation was amended on September 29, 2017. Holders of shares of Series E Stock are entitled to 10% dividends, payable monthly as may be permitted under Florida law out of funds legally available therefor. The shares of Series E Stock rank senior to any other class of our equity securities, except for the Series A Stock, have a liquidation preference of $0.40 per share and are not redeemable.

~~The remaining~~Other designations, rights and preferences of each of ~~the Series A Stock and Series E Stock~~series of preferred stock are identical, including (i) shares do not have voting rights, except as may be permitted under Florida law, (ii) are convertible into shares of our common stock at the ~~holder's~~holder’s option on a one for one basis, (iii) are entitled to a liquidation preference equal to a return of the capital invested, and (iv) each share will automatically convert into shares of common stock five years from the date of issuance or upon a change in control. Both the voluntary and automatic conversion formulas are subject to proportional adjustment in the event of stock splits, stock dividends and similar corporate events.

Dividends paid for Convertible Preferred Stock were $0 during the three months ended March 31, 2022 and for Series E and F Convertible Preferred Stock were $1,261 during the three months ended March 31, 2021.

Total preferred stock dividend accrued amounted to $691,450 and $691,861 as of March 31, 2022 and December 31, 2021, respectively.

BRIGHT MOUNTAIN MEDIA, INC., AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~SEPTEMBER 30, 2017~~March 31, 2022

~~(Unaudited)~~(unaudited)

NOTE 12 – COMMON STOCK.

~~NOTE 11 – SHAREHOLDERS’ EQUITY (continued).~~

In September 2017, Mr. W. Kip Speyer, the Company’s Chairman and Chief Executive Officer, purchased an aggregate of 500,000 shares of Series E Stock at a purchase price of $0.40 per share. The Company used the proceeds from these sales for working capital.

A) Stock issued for ~~cash~~Cash

~~In August 2017~~During the three months ended March 31, 2022 and 2021, the Company ~~issued 125,000 shares~~did not sell any of its ~~common stock for $50,000 or $0.40 per share to~~securities through a private ~~investor.~~placement.

B) Stock issued for services

~~On January 16, 2017,~~During the three months ended March 31, 2022, the Company issued ~~to a consultant 3,600~~174,253 shares of ~~its~~our common stock ~~at $0.85 per share, or $3,060,~~ for ~~services rendered. The Company valued these common shares based on~~ the ~~fair value at~~following concepts:

SCHEDULE OF COMMON SHARES ISSUED DURING THE PERIOD

	Shares (#)		Value
Shares issued to Oceanside employees per the acquisition agreement valued at $1.60		174,253	$	278,805
Total		174,253	$	278,805

During the ~~date of grant.~~

~~On April 25, 2017~~three months ended March 31, 2021, the Company issued ~~28,500~~a net 504,266 shares of ~~its~~our common stock ~~with a fair value of $22,800 on~~for the ~~date of issuance for compensation to employees and officers.~~following concepts:

	Shares (#)		Value
Options exercised by employees		100,000	$	13,900
Warrants exercised		25,000		10,000
Shares issued to Oceanside employees per the acquisition agreement valued at $1.60		379,266		606,826
Total		504,266	$	630,726

C) Stock issued for ~~dividends~~acquisitions

~~In January 2017,~~During the three months ended March 31, 2022 and 2021, the Company ~~issued 10,000 shares of its common stock as dividends to the holder of its Series A preferred stock.~~did not make any acquisitions.

D) Stock issued for ~~acquisition~~deemed dividend

~~On September 19, 2017,~~During the three months ended March 31, 2022 and 2021, the Company ~~issued 1,100,233 shares of its common~~did not issue any stock ~~with~~that resulted in a ~~fair value of $429,091 for acquisition of Daily Engage Media.~~deemed dividend.

~~Stock Incentive Plan and~~ Stock Option ~~Grants to Employees and Directors~~Compensation

The Company accounts for stock option compensation issued to employees for services in accordance with FASB ASC Topic 718, “Compensation – Stock Compensation” (“ASC 718”). ASC ~~Topic~~ 718 requires companies to recognize in the statement of operations and comprehensive loss the grant-date fair value of stock options and other ~~equity based~~equity-based compensation issued to employees. The value of the portion of an employee award that is ultimately expected to vest is recognized as an expense over the requisite service periods using the straight-line attribution method. The Company accounts for non-employee share-based awards in accordance with the measurement and recognition criteria of ~~ASC Topic 505-50, “~~ASU No. 2018-07, ~~Equity-Based Payments~~Compensation – Stock Compensation (Topic 718): Improvements to ~~Non-Employees~~Nonemployee Share-Based Payment Accounting. .” The Company estimates the fair value of stock options by using the Black-Scholes option-pricing model.

Stock options issued to consultants and other non-employees as compensation for services provided to the Company are accounted for based on the fair value of the services provided or the estimated fair market value of the option, whichever is more reliably measurable in accordance with FASB ASC ~~505“Equity”~~Topic 505, Equity, and ASC 718,, including related amendments and interpretations. The related expense is recognized over the period the services are provided.

BRIGHT MOUNTAIN MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022

(unaudited)

On April 20, 2011, the Company’s board of directors and majority stockholder adopted the 2011 Stock Option Plan (the “2011 Plan”), to be effective on January 3, 2011. The Company has reserved for issuance an aggregate of 900,000 shares of common stock under the 2011 Plan. The maximum aggregate number of shares of Company stock that shall be subject to Grants made under the Plan to any individual during any calendar year shall be 180,000 shares. On April 1, 2013, the Company’s board of directors and majority stockholder adopted ~~three~~the 2013 Stock Option Plan (the “2013 Plan”), to be effective on April 1, 2013. The Company has reserved for issuance an aggregate of 900,000 shares of common stock ~~option plans,~~under the ~~terms~~2013 Plan. As of ~~which are substantially identical.~~ December 31, 2021 and March 31, 2022, 697,000 and 801,000 shares, respectively were remaining under the 2011 Plan for future issuance. As of March 31, 2022 and December 31, 2021, 567,000 shares were remaining under the 2013 Plan for future issuance.

On May 22, 2015, the Company’s board of directors and majority stockholder adopted the 2015 Stock Option Plan (the “2015 Plan”), to be effective on May 22, 2015. The Company has reserved for issuance an aggregate of 1,000,000 shares of common stock under the 2015 Plan. As of March 31, 2022 and December 31, 2021, 859,000 shares were remaining under the 2015 Plan for the future issuance.

On November 7, 2019, the Company’s board of directors and majority stockholder adopted the 2019 Stock Option Plan (the “2019 Plan”), to be effective on November 7, 2019. The Company has reserved for issuance an aggregate of 5,000,000 shares of common stock under the 2019 Plan. As of March 31, 2022 and December 31, 2021, 4,861,773 and 4,261,773 shares, respectively, were remaining under the 2019 Plan for the future issuance.

The purpose of ~~each plan is~~the 2011 Plan, 2013 Plan, 2015 Plan and 2019 Plan (the “Plans” are to provide an incentive to attract and retain directors, officers, consultants, advisors and employees whose services are considered valuable, to encourage a sense of proprietorship and to stimulate an active interest of such persons into our development and financial success. Under ~~each plan,~~the 2015 Plan, the Company is authorized to issue incentive stock options intended to qualify under Section 422 of the Code, non-qualified stock options, stock appreciation rights, performance shares, restricted stock and long-term incentive awards. The ~~Compensation Committee of the Company's~~Company’s board of directors ~~administers each plan.~~will administer the 2011 Plan until such time as such authority has been delegated to a committee of the board of directors. The material terms of each option ~~which may be~~ granted ~~under each plan will~~pursuant to the 2011 Plan by the Company shall contain the following terms: (i) that the purchase price of each share purchasable under an incentive option shall be determined by the Committee at the time of grant, (ii) the term of each option shall be fixed by the Committee, but no option shall be exercisable more than 10 years after the date such option is granted and (iii) in the absence of any option vesting periods designated by the Committee at the time of grant, options shall vest and become exercisable in terms and conditions, consistent with the ~~plan,~~Plan, as may be determined by the Committee and specified in the ~~grant instrument.~~Grant Instrument. See note 15 Subsequent events for more information.

~~BRIGHT MOUNTAIN MEDIA, INC., AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~SEPTEMBER 30, 2017~~

~~(Unaudited)~~

~~NOTE 11 – SHAREHOLDERS’ EQUITY (continued).~~

~~Stock Option Plans~~

On April 20, 2011, the Company's board of directors and majority stockholder adopted the 2011 Stock Option Plan (the “2011 Plan”) under which the Company reserved for issuance an aggregate of 900,000 shares of common stock for grants to be made under the 2011 Plan. The maximum aggregate number of shares of common stock that shall be subject to grants made under the 2011 Plan to any individual during any calendar year is 180,000 shares. As of September 30, 2017, 27,000 shares were remaining under the 2011 Plan for future issuance.

On April 1, 2013, the Company's board of directors and majority stockholder adopted the 2013 Stock Option Plan (the “2013 Plan”) under which the Company reserved for issuance an aggregate of 900,000 shares of common stock for grants to be made under the 2013 Plan. The maximum aggregate number of shares of common stock that shall be subject to grants made under the 2013 Plan to any individual during any calendar year is 180,000 shares. As of September 30, 2017, 134,000 shares were remaining under the 2013 Plan for future issuance.

On May 22, 2015, the Company's board of directors adopted the 2015 Stock Option Plan (the “2015 Plan”) under which the Company reserved for issuance an aggregate of 1,000,000 shares of common stock for grants to be under the 2015 Plan. The majority shareholders of the Company ratified the adoption of the 2015 Plan on June 17, 2015. The maximum aggregate number of shares of common stock that shall be subject to grants made under the 2015 Plan to any individual during any calendar year is 100,000 shares. As of September 30, 2017, 439,000 shares were remaining under the 2015 Plan for future issuance.

On March 22, 2016 the Company granted 100,000 ten-year stock options, which have an exercise price of $0.695 per share to an executive officer and director. The aggregate fair value of these options was computed at $39,901 or $0.3990 per option.

On March 22, 2016 the Company granted 46,000 ten-year stock options, which have an exercise price of $0.695 per share to a director. The aggregate fair value of these options was computed at $18,354 or $0.3990 per option.

On September 1, 2017 the Company granted 10,000 ten-year stock options, which have an exercise price of $0.50 per share. The aggregate fair value of these options was computed at $1,840 or $0.184 per option.

The Company estimates the fair value of share-based compensation utilizing the Black-Scholes option pricing model, which is dependent upon several variables such as the expected option term, expected volatility of our stock price over the expected option term, expected risk-free interest rate over the expected option term, expected dividend yield rate over the expected option term, and an estimate of expected forfeiture rates.

The Company believes this valuation methodology is appropriate for estimating the fair value of stock options granted to employees and directors, which is subject to ASC ~~Topic~~ 718 requirements. These amounts are estimates and thus may not be reflective of actual future results, nor amounts ultimately realized by recipients of these grants. The Company recognizes share-based compensation expense on a ~~straight-line~~straight- line basis over the requisite service period for each award. ~~The following table summarizes the assumptions the Company utilized to record compensation expense for stock options granted during the nine months ended September 30, 2017 and 2016:~~

Nine Months Ended
September 30,

Assumptions:

2017

2016

Expected term (years)

6.25

6.25

Expected volatility

52
%

63
%
Risk-free interest rate

1.99
%

0.38
%
Dividend yield

0
%

0
%
Expected forfeiture rate

0
%

0
%

~~BRIGHT MOUNTAIN MEDIA, INC., AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~SEPTEMBER 30, 2017~~

~~(Unaudited)~~

~~NOTE 11 – SHAREHOLDERS’ EQUITY (continued).~~

The expected life is computed using the simplified method, which is the average of the vesting term and the contractual term. The expected volatility is based on an average of similar public company’s historical ~~volatility.~~volatility as the Company’s stock has limited trading volume history. The risk-free interest rate is based on the U.S. Treasury yields with terms equivalent to the expected term of the related option at the time of the grant. Dividend yield is based on historical trends. While the Company believes these estimates are reasonable, the compensation expense recorded would increase if the expected life was increased, a higher expected volatility was used, or if the expected dividend yield increased.

BRIGHT MOUNTAIN MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022

(unaudited)

The Company recorded ~~$21,983~~$28,916 and ~~$30,069~~$68,294 of non-cash stock-based stock option compensation expense for the three months ended March 31, 2022 and 2021, respectively. The stock option expense for the three months ended ~~September 30, 2017~~March 31, 2022 and ~~2016,~~2021, respectively ~~and $95,821 and $107,193 for the nine months ended September 30, 2017 and 2016, respectively. The non-cash stock option expense~~ has been recognized as a component of general and administrative expenses in the accompanying ~~unaudited condensed~~ consolidated financial statements.

As of ~~September 30, 2017~~March 31, 2022, there were total unrecognized compensation costs related to non-vested share-based compensation arrangements of ~~$104,051~~$124,622 to be recognized through ~~August 2020.~~May 2025.

A summary of the ~~Company's~~Company’s stock option activity during the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2022 is presented below:

SCHEDULE OF STOCK OPTION ACTIVITY

										Number of Options				Weighted Average Exercise Price		Weighted Average Remaining Contractual Term			Aggregate Intrinsic Value
	Number of Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term		Aggregate Intrinsic Value
Balance Outstanding, December 31, 2016		2,281,000		$	0.47		6.8	$	795,185
Balance Outstanding, December 31, 2021										1,415,227			$	0.62		6.2		$	—
Granted		10,000			—		—		—		—				—		—			—
Exercised		—			—		—		—		—				—		—			—
Forfeited		(104,000	)		—		—		—		—				—		—			—
Expired		—			—		—		—		(54,000	)			—		—			—
Balance Outstanding, September 30, 2017		2,187,000		$	0.45		5.9	$	220,174
Exercisable at September 30, 2017		1,640,000		$	0.31		3.8
Balance Outstanding, March 31, 2022										1,361,227			$	0.62		6.2		$	—
Exercisable at March 31, 2022										678,364			$	0.73		3.5		$	—

Summarized information with respect to options outstanding under the ~~three~~ option plans at ~~September 30, 2017~~March 31, 2022 is as follows:

SCHEDULE OF OPTIONS OUTSTANDING UNDER OPTION PLANS

Options Outstanding

Options Exercisable
Range or
Exercise Price

Number
Outstanding

Remaining
Average
Contractual Life (In Years)

Weighted
Average
Exercise
Price

Number
Exercisable

Weighted
Average
Exercise
Price

Remaining Average Conversion Life (In Years)
0.14 - 0.24

720,000

1.1

$
0.14

720,000

$
0.14

1.1
0.25 - 0.49

351,000

1.7

$
0.28

351,000

$
0.28

1.6
0.50 - 0.85

1,116,000

3.1

$
0.69

569,000

$
0.60

1.2

2,187,000

5.9

$
0.45

1,640,000

$
0.31

3.8

		Options Outstanding
Range or Exercise Price		Number Outstanding		Weighted Average Exercise Price		Remaining Average Contractual Life (In Years)		Number Exercisable		Weighted Average Exercise Price
$	0.01 - 0.13		650,000	$	0.01		9.4		25,000	$	0.01
$	0.14 - 0.24		—		—		—		—		—
$	0.25 - 0.49		72,000		0.28		0.9		72,000		0.28
$	0.50 - 0.85		501,000		0.69		3.2		501,000		0.69
$	0.86 - 1.75		138,227		1.64		7.7		80,364		1.63

Total			1,361,227	$	0.44		6.5		678,364	$	0.73

NOTE 13 – RELATED PARTIES.

Centre Lane Partners Master Credit Fund II, L.P. (“Center Lane Partners”), who sold the Company the Wild Sky business in June 2020 has partnered and assisted the Company from a liquidity perspective during 2021 and through the three months ended March 31, 2022. This relationship has been determined to qualify as a related party. A related party is a party that can exercise significant influence over the Company in making financial and/or operating decisions.

BRIGHT MOUNTAIN MEDIA, INC., AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~SEPTEMBER~~March 31, 2022

(unaudited)

On April 26, 2021, the Company and certain of its subsidiaries entered into a First Amendment to Amended and Restated Senior Secured Credit Agreement (the “First Amendment”). The Company and its subsidiaries are parties to a credit agreement between itself and Centre Lane Partners as Administrative Agent and Collateral Agent dated June 5, 2020 (the “Credit Agreement”). The Credit Agreement was amended to permit the Company to raise up to $6,000,000 of total cash proceeds from the sale of its preferred stock prior to December 31, 2021 without having to make a mandatory prepayment of the loans (the “Loans”) under the Credit Agreement. The interest rate on the Loans after April 26, 2021 was increased to 10.00% per annum from 6.00%, which can continue to be paid in-kind in lieu of cash payment. In addition, the Company may issue up to $800,000 in dividends from the previous limit of $500,000 per annum. In addition, the Company has issued 150,000 common shares to Centre Lane Partners as part of this transaction. This term loan shall be repaid by June 30, ~~2017~~2025, with payments of 2.5% of outstanding principal beginning on June 30, 2023.

~~(Unaudited)~~

On August 12, 2021, the Company and certain of its subsidiaries entered into a Third amendment to the Amended and Restated Senior Secured Credit Agreement between itself and Centre Lane Partners (“the Third Amendment”). The Company and its subsidiaries are parties to a credit agreement between itself and Centre Lane Partners as Administrative Agent and Collateral Agent dated June 5, 2020, as amended the Credit Agreement. The Credit Agreement was amended to provide for an additional loan amount of $0.5 million, in the aggregate. This term loan shall be repaid by June 30, 2025, with payments of 2.5% of outstanding principal beginning on June 30, 2023. In addition, and as part of the transaction, there is an Exit Fee (“the Exit Fee”) totaling $0.250 million which will be added and capitalized to the principal amount of the original loan and the original loan terms apply. In addition, the Company has issued 2.0 million common shares to Centre Lane Partners as part of this transaction.

BRIGHT MOUNTAIN MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022

(unaudited)

~~NOTE 12 – CONCENTRATIONS.~~

On December 23, 2021, the Company and certain of its subsidiaries entered into a Seventh amendment to the Amended and Restated Senior Secured Credit Agreement between itself and Centre Lane Partners (“the Seventh Amendment”). The Company ~~has historically purchases~~and its subsidiaries are parties to a ~~substantial~~credit agreement between itself and Centre Lane Partners as Administrative Agent and Collateral Agent dated June 5, 2020, as amended the Credit Agreement. The Credit Agreement was amended to provide for an additional loan amount of $500,000, in the aggregate. This term loan shall be repaid by June 30, 2025, with payments of 2.5% of outstanding principal beginning on June 30, 2023. In addition, and as part of the transaction, there is an Exit Fee (“the Exit Fee”) totaling $500,000 which will be added and capitalized to the principal amount of the original loan and the original loan terms apply. There was no issuance of common shares as part of this amendment.

On January 26, 2022, the Company and certain of its ~~products~~subsidiaries entered into an Eighth amendment to the Amended and Restated Senior Secured Credit Agreement between itself and Centre Lane Partners (“the Eighth Amendment”). The Company and its subsidiaries are parties to a credit agreement between itself and Centre Lane Partners as Administrative Agent and Collateral Agent dated June 5, 2020, as amended the Credit Agreement. The Credit Agreement was amended to provide for an additional loan amount of $350,000, in the aggregate. This term loan shall be repaid by June 30, 2025, with payments of 2.5% of outstanding principal beginning on June 30, 2023. In addition, and as part of the transaction, there is an Exit Fee (“the Exit Fee”) totaling $350,000 which will be added and capitalized to the principal amount of the original loan and the original loan terms apply. There was no issuance of common shares as part of this amendment.

On March 11, 2022, the Company and certain of ~~America, Inc.~~its subsidiaries entered into a Tenth amendment to the Amended and Restated Senior Secured Credit Agreement between itself and Centre Lane Partners (“the Tenth Amendment”). The Company and its subsidiaries are parties to a credit agreement between itself and Centre Lane Partners as Administrative Agent and Collateral Agent dated June 5, 2020, as amended the Credit Agreement. The Credit Agreement was amended to provide for an additional loan amount of $300,000, in the aggregate. This term loan shall be repaid by June 30, 2023. In addition, and ~~Bulova Corporation.~~as part of the transaction, there is an Exit Fee (“the Exit Fee”) totaling $15,000 which will be added and capitalized to the principal amount of the original loan and the original loan terms apply. There was no issuance of common shares as part of this amendment. Additionally, per the Tenth Amendment, the original loan and amendments one through eight now have maturity dates of June 30, 2025, with payments of 2.5% of outstanding principal beginning on June 30, 2023. Amendments nine through fourteen have a maturity date of June 30, 2023.

On March 25, 2022, the Company and certain of its subsidiaries entered into an Eleventh amendment to the Amended and Restated Senior Secured Credit Agreement between itself and Centre Lane Partners (“the Eleventh Amendment”). The ~~following table provides information on~~Company and its subsidiaries are parties to a credit agreement between itself and Centre Lane Partners as Administrative Agent and Collateral Agent dated June 5, 2020, as amended the ~~percentage~~Credit Agreement. The Credit Agreement was amended to provide for an additional loan amount of ~~purchases~~$500,000, in ~~during~~the aggregate. This term loan shall be repaid by June 30, 2023. In addition, and as part of the transaction, there is an Exit Fee (“the Exit Fee”) totaling $25,000 which will be added and capitalized to the principal amount of the original loan and the original loan terms apply. There was no issuance of common shares as part of this amendment. See Note 15 for amendments to the Amended and Restated Senior Secured Credit Agreement subsequent to March 31, 2022.

BRIGHT MOUNTAIN MEDIA, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022

(unaudited)

The accumulated gross debt discount as of March 31, 2022 and December 31, 2021 totaled $8,626,871 and $8,200,476, respectively and will be amortized into the condensed consolidated statement of operations and comprehensive loss and included in the interest expense – related party over the remaining life of the loan or until the next debt modification or extinguishment is determined. Interest expense for note payable to related party for the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2022 and ~~2016 from these vendors:~~2021 was $804,129 and $255,506, respectively.

Three Months Ended
September 30,

Nine Months Ended
September 30,

2017

2016

2017

2016

Citizens

52
%

37
%

58
%

40
%
Bulova

17
%

18
%

18
%

18
%

~~Although we continue~~The total related party debt owed to ~~add additional product vendors~~Centre Lane Partners was $28,136,564 and ~~we continue~~$26,334,064 as of March 31, 2022 and December 31, 2021, respectively. The debt owed to ~~expand our product line~~Centre Lane Partners is reported net of their unamortized debt discount of $4,026,510 and ~~vendor relationships, due~~$3,853,822 as of March 31, 2022 and December 31, 2021, respectively. For further clarification, please see Note 9, Notes Payable.

As discussed in Note 9, notes payable to ~~continued high concentration~~the CEO amounted to $57,181 and ~~reliance~~$53,729 as of March 31, 2022 and December 31, 2021, respectively, and are reported net of their unamortized debt discount of $22,819 and $26,271 as of March 31, 2022 and December 31, 2021, respectively. See Note 9 further discussion on these ~~two vendors, the loss of one of these two vendors could adversely affect the Company's operations.~~notes payable.

The Company generates revenues from two segments: product sales and advertising. The sharp increase in PayPal/eBay concentration is due to our acquisition of the Black Helmet Apparel business in December 2016. Due to high concentration and reliance on these portals, the loss of a working relationship with either of these two portals could adversely affect the Company's operations. In addition, a substantial amount of payments for our products sold are processed through PayPal and Amazon. A disruption in PayPal or Amazon payment processing could have an adverse effect on the Company's operations and cash flow. During the three months ended ~~September 30, 2017 these two portals accounted for 52%~~March 31, 2022 and ~~47%~~2021, we paid cash dividends on the outstanding shares of the Company’s Series E and F Preferred Stock of $0 and $1,261, respectively, held by affiliates of ~~our~~the Company.

The unsecured and interest free Closing Notes of $750,000 related to the Oceanside acquisition were recorded ratably as compensation expense into the condensed consolidated statement of operations and comprehensive loss over the 24-month term and an accrued payable is being recognized over the same period. As of August 15, 2020, the Company did not make payment on the First Closing Note and thereby defaulted on its obligation and the Second Closing Note accelerated to become payable as of August 15, 2020. Upon default, the Closing Notes accrue interest at a 1.5% per month rate, or 18% annual rate. As a result, there was a total ~~product sales as compared to 7%~~charge of $300,672 recorded during the third quarter of 2020 which was $250,000 of compensation expense and ~~92% in~~$50,672 of interest expense-related party. For the three months ended ~~September 30, 2016. During~~March 31, 2022 and 2021, $33,288 of interest expense-related party was recorded.

NOTE 14 – INCOME TAXES.

The Company recorded $0 tax provision for the ~~nine months September 30, 2017 these two portals accounted for 51% and 48%, respectively, of our total product sales as compared to 7% and 90% in the nine~~three months ended ~~September 30, 2016.~~March 31, 2022 and 2021, due in large part to its expected tax losses for the year and maintaining a full valuation allowance against its net deferred tax assets.

~~Credit Risk~~

The Company minimizes the concentration of credit risk associated with its cash by maintaining its cash with high quality federally insured financial institutions. However, cash balances in excess of the FDIC insured limit of $250,000 are at risk. At ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016, respectively,~~2021, the Company had ~~no cash balances in excess of~~0 unrecognized tax benefits or accrued interest and penalties recorded. No interest and penalties were recognized during the ~~FDIC insured limit.~~

~~Concentration of Funding~~

~~During the nine~~three months ended ~~September 30, 2017, the Company's funding was provided primarily through the issuance of $950,000 in convertible notes~~March 31, 2022 and ~~the sale of Series E Stock to an officer~~2021.

NOTE 15 – SUBSEQUENT EVENTS.

Between April 15, 2022 and ~~director of the Company. See Notes 8 and 10.~~

~~NOTE 13 – SUBSEQUENT EVENTS.~~

Subsequent to September 30, 2017, Mr. W. Kip Speyer, the Company’s Chairman and Chief Executive Officer, purchased an aggregate of 625,000 shares of Series E Stock at a purchase price of $0.40 per share. The designations, rights and preferences of Series E Stock as described in Note 11. The Company used the proceeds from these sales for working capital.

~~On November 14, 2017,~~June 10, 2022, the Company and certain of its subsidiaries entered into ~~an Amendment~~three amendments to the Amended and Restated ~~Membership Interest Purchase~~Senior Secured Credit Agreement between itself and Centre Lane Partners Master Credit Fund II, L.P. (“Centre Lane Partners”). The Company and its subsidiaries are parties to a credit agreement between itself and Centre Lane Partners as Administrative Agent and Collateral Agent dated ~~September 19, 2017 by~~June 5, 2020, as amended (the “Credit Agreement”). The Credit Agreement was amended to provide for an additional loan amount of $1.3 million, in the aggregate. This term loan matures on June 30, 2023. In addition, and ~~among our company, Daily Engage Media~~as part of the transaction, there is an Exit Fee (“the Exit Fee”) totaling $65 thousand which will be added and capitalized to the principal amount of the term loan.

On April 14, 2022, the Board of Directors of the Company and the ~~members of Daily Engage Media which modified the terms~~Compensation Committee of the ~~escrow arrangement~~Board adopted and approved the 2022 Bright Mountain Media Stock Option Plan (the “Stock Option Plan”). The Stock Option Plan will be presented for stockholder approval at the Company’s 2022 Annual Meeting of Stockholders. The Stock Option Plan provides for the ~~earnout shares. Under~~grants of awards to eligible employees, directors and consultants in the ~~terms~~form of stock options. stock. The Stock Option Plan is the successor to the Company’s prior stock option plans and accordingly no new grants will be made under the prior plans from and after the date hereof. The Stock Option Plan is a term of 10 years and authorizes the issuance of up to 22,500,000 shares of the ~~amendment, instructions~~Company’s common stock.

On June 14, 2022, the Company signed a second lease addendum (“Second Addendum”) to ~~our transfer agent have been deposited in escrow in lieu~~the lease for the Boca Raton headquarters office space with approximately 4,500 square feet. The new lease term is for five years beginning upon completion of ~~certificates representing~~improvements to the ~~earnout shares. In connection therewith,~~office space by the ~~parties entered into an Amended and Restated Escrow Agreement.~~Landlord. For the interim period from signing of the Second Addendum to the completion of the improvements (estimated at approximately 2 months), the monthly rent will be $7,719. Thereafter, for the 1st year, the cash rent will be $11,893 per month. Rent increases yearly at 3% from years two through five.

ITEM 2.

~~MANAGEMENT'S~~ MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

The following discussion of our unaudited condensed consolidated financial condition and results of operations for the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2022 and ~~2016~~2021 should be read in conjunction with the unaudited condensed consolidated financial statements and the notes to those statements that are included elsewhere in this report. Our discussion includes forward-looking statements based upon current expectations that involve risks and uncertainties, such as our plans, objectives, expectations and intentions. Actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of a number of factors, including those set forth later in this report under Part II, Item 1A. in Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended December 31, ~~2016~~2021 as filed with the Securities and Exchange ~~Commission.~~Commission on June 13, 2022 (the “2020 Form 10-K”) and our other filings with the SEC. We use words such as “anticipate,” “estimate,” “plan,” “project,” “continuing,” “ongoing,” “expect,” “believe,” “intend,” “may,” “will,” “should,” “could,” and similar expressions to identify forward-looking statements. All information in this section for the three months ended March 31, 2022 and 2021 is unaudited and derived from the unaudited condensed consolidated financial statements appearing elsewhere in this report; unless otherwise noted, all information for the year ended December 31, 2021 is derived from our audited consolidated financial statements appearing in the 2021 Form 10-K as filed with the SEC on June 13, 2022.

Executive Overview of First Quarter 2022 Results

Our key user metrics and financial results for the first quarter of 2022, for the three months ended March 31, 2022, are more fully discussed and described herein and should be read in context with the disclosure on this page. The first quarter results are as follows:

User metrics:

●

Quarterly ad impressions delivered were approximately 1.1 billion for the three months ended March 31, 2022 and 2021.

First quarter 2022 financial results:

	●	Advertising revenue increased 44% in the three months ended March 31, 2022 from the same period of 2021.

	●	Gross profit increased 71% in the three months ended March 31, 2022 from the same period of 2021.

	●	Selling, general and administrative expenses decreased 9% in the three months ended March 31, 2022 from the same period of 2021.

	●	Included within selling, general, and administrative expenses for the three months ended March 31, 2022 are $396,267 of non-cash amortization of the intangible assets, and $48,428 of stock-based compensation.

	●	Net cash used in operating activities was ($1,241,624) for the three months ended March 31, 2022 as compared to ($222,093) for the three months ended March 31, 2021.

Overview

Bright Mountain Media, Inc. is aan end-to-end digital media ~~holding company for online assets targeting~~ and ~~servicing~~advertising services platform, efficiently connecting brands with targeted consumer demographics. Through the military and public safety markets. Last year, we connected over 315 million relevant advertisements with approximately 57 million visitors within our targeted demographics. Our websites are dedicated to providing “~~those that keep us safe~~” places to go online where they can do everything from stay current on news and events affecting them, look for jobs, share information, communicate with the public, and purchase products. We own and manage 24 websites which are customized to provide our niche users, including active, reserve and retired military, law enforcement, first responders and other public safety employees with information, news and entertainment across various platforms that has proven to beremoval of interest and engaging to them. Now coupled with our recently acquired wholly owned subsidiary Daily Engage Media, we have evolved to place our emphasis on not only providing quality content on our websites to drive traffic increases, but to increasemiddlemen in the advertising services process, Bright Mountain Media efficiently connects brands with targeted consumer demographics while maximizing revenue ~~we generate from companies and brands looking~~ to ~~reach our audiences. Daily Engage Media is an~~publishers. Bright Mountain Media’s assets include the Bright Mountain, LLC ad network, ~~that connects advertisers with approximately 200 digital publications worldwide. Our websites feature timely, proprietary~~MediaHouse (f/k/a NDN), Oceanside (f/k/a S&W Media), Wild Sky Media and ~~aggregated content covering current events and a variety~~24 owned and/or managed websites.

We generate revenue sales of additional subjects targeted to the specific demographics of the individual website. Our business strategy requires us to continue to provide this quality content to our niche markets as we integrate Daily Engage Media’s experience and expertise in connecting digital readers and advertisers to grow our business, operations and revenues. Presently, weadvertising services which generate revenue from two segments: product sales and advertising. Our focus at this time is to launch a full-scale ad services platform, the Bright Mountain Media Ad Network. We believe that this new platform will become our core business and will have a significant impactadvertisements (ad impressions) placed on our ~~future business~~owned and ~~operations.~~

~~A key component~~managed sites, as well as from advertisements we place on partner websites, for which we earn a share of ~~our growth is our transition to an ad network. Our ad network creates~~the revenue. We also generate advertising services revenue from ~~other publisher’s content in our market in~~facilitating the ~~form~~real-time buying and selling of ~~a revenue share based on ad impressions we deliver. For this reason, the managerial focus~~advertisements at scale between networks of buyers, often called DSPs (Demand Side Platforms) and sellers, often called SSPs (Supply Side Platforms).

When fully developed Bright Mountain’s full suite of advertising solutions will be in increasing our total impressions delivered to grow our total advertising revenue. From the fourth quarter in 2016 to the third quarter of 2017, we experienced an 171% increase in the number of total ad impressions delivered including impressions from Daily Engage Media from September 19, 2017 to September 30, 2017. Ad impression growth over the past four consecutive quarters is conveyed in the following graph:include:

The following graph provides information on the quarterly traffic to our proprietary and managed websites over the respective quarterly periods presented. As a result of our acquisition of Daily Engage Media during the third quarter of 2017, and our shifting focus to increasing the advertising revenue we generate from companies and brands looking to reach our audiences, we do not expect to provide the following information in future periods. The total traffic for the third quarter including Daily Engage Media for the period September19, 2017 through September 30, 2017 would be approximately 17,057,797.

~~The Bright Mountain Media Ad Network includes a real-time bidding Ad Exchange. This new platform is expected to have capabilities including the following:~~


●	·	~~server integration with several ad exchanges, making~~The ability for ~~extremely quick ad deployments;~~ advertisers to purchase advertising space on a variety of digital publications;

	· ●	~~leading~~Leading targeting technology, allowing advertisers to pinpoint their marketing efforts to reach ~~the military and public safety~~geo-targeted, specific demographics across desktop, tablet, and mobile devices;

	· ●	~~capable of handling~~The ability to handle any ad format, including video, display, and native ~~ads; and~~ advertisements;

	· ●	adAd serving and self-service features for publishers and ~~advertisers.~~ advertisers; and

	●	Server-to-server integration with other advertiser and publisher platforms for extremely quick transactions and ad deployments.

~~This Ad Exchange~~Bright Mountain’s platform will be a ~~trading desk~~marketplace for publishers and advertisers where they will be able to ~~login and~~ choose from various features to maximize their earning potential. Advertisers have the ability to directly target desired demographics on publishers’ sites through our platform. Publishers will be able to select a variety of ad units for their video, mobile, display and native advertisements, and ~~also~~ have the ability to create their own unique ad formats. ~~Advertisers will be able to choose where their ads will be seen using our filters or by connection directly~~

We have begun expansion with the ~~publisher~~recent acquisition of Wild Sky Media. Wild Sky Media offers massive global reach through ~~our platform.~~hyper-engaging content and multicultural audiences. This is achieved through their six websites focusing on parenting and lifestyle brands. The websites include Mom.com, Cafemom.com, LittleThings.com, mamaslatinas.com, revelist.com, and babynamewizard.com.

Key initiatives

Our ~~niche market~~growth strategy is based upon:

	●	completing and launching the Bright Mountain Media advertising solutions marketplace;

	●	expanding our sales revenues through organic growth;

	●	continuing to pursue acquisition candidates that are strategic to our business plan;

	●	evaluating expenses attributed to our non-strategic business lines; and

	●	continuing to automate our processes and reduce overhead where possible without impacting our customer experience.

Results of operations

Revenues, Cost of Revenue, Gross Profit Margins, selling, general and administrative expenses, and other income (expense)

For the Three Months Ended March 31,
2022 2021 Change % Change

Advertising revenues $ 3,459,164 $ 2,399,720 $ 1,059,444 44 %
Total cost of revenue $ 1,690,615 $ 1,366,843 $ 323,772 24 %
Gross Profit $ 1,768,549 $ 1,032,877 $ 735,672 71 %
Gross profit margin as a percentage of advertising revenues 51.1 % 43.0 %
Advertising revenue for the ~~military~~three months ended March 31, 2022 was 44% higher than the comparable period in 2021. The main reason for the increase was higher programmatic revenue at our Wild Sky and ~~public safety sectors consists~~BMLLC businesses.
We incur costs of ~~a targeted U.S. demographic of in excess of 40 million users including their spouses. Adding their parents~~sales associated with the advertising revenue. These costs include revenue share payments to media providers and ~~other family members increases~~website publishers. Our gross profit margin percentage increased 810 basis points (51.1% versus 43.0%) for the U.S. targeted market to approximately 100 million users. We also believe there are another estimated 100-plus million military and public safety personnel and their families and veterans internationally.

~~As a homogeneous group, our user profile should be attractive to local, national and international companies whose advertising budgets are shifting from print media, radio and television~~three months ended March 31, 2022 compared to the ~~internet. We believe that~~comparable prior period, mainly due to higher margins in our programmatic business due to the ~~market~~increased use of our proprietary RTB exchange platform which eliminates the use of third parties and the increase of new clients with improved margins.
Selling, General and Administrative Expenses
For the Three Months Ended March 31,
2022 2021 $ Change % Change

Selling, general and administrative expense $ 3,887,359 $ 4,274,434 $ (387,075 ) (9 )%
Selling, general and administrative expense as a percentage of total revenue 112.4 % 178.1 %
Selling, general and administrative costs decreased approximately $387,075, or (9%) for the ~~military~~three months ended March 31, 2022 compared to the same period in 2021, mainly due to reduced costs related to some reductions in headcount throughout our operations, and ~~public safety providers is fragmented,~~professional fees.
Selling, general and ~~that~~administrative expenses are expected to increase as we ~~have an opportunity to become a leading player in the market through~~execute our planned growth ~~consolidation~~strategy of launching and operating the Bright Mountain Media ~~Ad Network~~ad exchange network which will include additional administrative support. Subject to the availability of additional working capital, the Company also intends to add staff to its accounting department to improve controls over its accounting and reporting processes. As the Company expands the size of the accounting department, its use of consultants is expected to decrease.
Other income, net
For the Three Months Ended March 31,
2022 2021 $ Change % Change

Other income, net $ 1,953 $ 1,532,282 $ (1,530,329 ) (100 )%
Other income decreased approximately $1,530,329, or (100%) for the three months ended March 31, 2022 compared to the same period in 2021, mainly due to reduced PPP loan forgiveness by $865,195 and increased interest expense – related party of $804,129.
35
Non-GAAP financial measure
We report adjusted EBITDA as a supplemental measure to U.S. generally accepted accounting principles (“GAAP”). This measure is one of the primary metrics by which we evaluate the performance of our business, on which our internal budgets are based. We believe that investors have access to, and we are obligated to provide, the same set of tools that we use in analyzing our results. This non-GAAP measure should be ~~specifically targeted~~considered in addition to results prepared in accordance with GAAP but should not be considered a substitute for or superior to GAAP results. We endeavor to compensate for the limitations of the non-GAAP measure presented by providing the comparable GAAP measure with equal or greater prominence and description of the reconciling items, including quantifying such items to derive the non-GAAP measure. We encourage investors to examine the reconciling adjustments between the GAAP and non-GAAP measure.
Our adjusted EBITDA is defined as operating income/loss excluding:
● non-cash stock option compensation expense;
● depreciation;
● equity raise expenses;
● professional fees;
● acquisition-related items consisting of amortization expense and impairment expense;
● interest; and
● amortization on debt discount.
We believe this measure is useful for analysts and investors as this measure allows a more meaningful year-to-year comparison of our performance. Moreover, our management uses this measure internally to evaluate the performance of our business as a whole. The above items are excluded from adjusted EBITDA measure because these items are non-cash in nature, and we believe that by excluding these items, adjusted EBITDA corresponds more closely to the cash operating income/loss generated from our business. Adjusted EBITDA has certain limitations in that it does not take into account the impact to our ~~niche demographics.~~statement of operations and comprehensive loss of certain expenses.

~~Our~~The following is an unaudited reconciliation of net (loss) to adjusted net (loss) and Adjusted EBITDA for the periods presented:

For the Three Months Ended March 31,

2022 2021

Net (loss) before tax $ (2,116,857 ) $ (1,709,275 )
plus:
Stock compensation expense 145,665 170,048
Depreciation expense 3,385 18,047
Amortization expense 396,266 396,266
Gain on forgiveness of PPP loan (841,540 ) (1,706,735 )
Professional fees 143,284 45,000
Amortization on debt discount 279,978 3,452
Bad debt 271,355 -
Capital raise expenses 261 -
Interest expense 13 260,995
Interest expense – related party 839,417 35,288
Adjusted EBITDA $ (878,773 ) $ (2,486,914 )
36
Liquidity and capital resources
Liquidity is the ability of a company to ~~fully implement~~generate sufficient cash to satisfy its needs for cash. The following table summarized total current assets, total current liabilities and working (deficit) at March 31, 2022 as compared to December 31, 2021.
March 31, 2022 December 31, 2021
Total current assets $ 4,162,496 $ 5,257,577
Total current liabilities 14,314,640 23,069,784
Net working deficit $ (10,152,144 ) $ (17,812,207 )
As we continue our efforts to grow our business, we expect that our monthly cash operating overhead will continue to increase as we add personnel, although at a lesser rate, and we are not able at this ~~strategy~~time to quantify the amount of this expected increase. During 2021, we implemented policies and ~~launch~~procedures around cash collections to prevent the aging of accounts receivables that we experienced in 2020. Cash collection efforts have been successful, and we feel that we have appropriately reserved for uncollectible amounts at March 31, 2022.
During February and March 2021, the Company received two loans with proceeds totaling $1,137,140 (the “PPP Loans”) under the second tranche of the Paycheck Protection Program (the “PPP”). The PPP was established under the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) and is administered by the U.S. Small Business Administration (“SBA”). The Second Bright Mountain ~~Media Ad Network~~and Second Wild Sky PPP Loans are evidenced by promissory notes (the “Promissory Notes”) with Regions Bank and Holcomb Bank, respectively, and have a two-year term and bear interest at a rate of 1.0% per annum. Monthly principal and interest payments are deferred for six months after the date of disbursement. The PPP Loans may be prepaid at any time prior to maturity with no prepayment penalties. The Promissory Note contains customary events of default provisions. Under the terms of the CARES Act, PPP loan recipients can apply for and be granted forgiveness for all or a portion of loans granted under the PPP. On March 23, 2022, the Company obtained PPP forgiveness for the second Wild Sky loan totaling $841,540. No assurance is ~~dependent upon our ability to raise additional sufficient capital. Historically we have been dependent upon loans and equity purchases~~provided that the Company will obtain forgiveness of the Second Bright Mountain PPP Loans in whole or in part.
During January through March 31, 2022, the Company received $1.4 million in debt financing from ~~our Chief Executive Officer and, to a lesser extent in prior years from other accredited investors, to provide sufficient~~Centre Lane Partners. The use of the funds ~~to meet our~~was for general working capital needs. During May 26, 2021 and December 31, 2021, the ~~nine~~Company received $5.1 million in debt financing from Centre Lane Partners. The use of the funds was for general working capital needs.
Going concern
The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company’s management has evaluated whether there is substantial doubt about the Company’s ability to continue as a going concern and has determined that substantial doubt existed as of the date of the end of the period covered by this report. This determination was based on the following factors: (i) the Company used cash of approximately $1.2 million in operations for the three months ended ~~September 30, 2017 we raised $1,460,000~~March 31, 2022; (ii) the Company’s available cash as of ~~working capital from our Chief Executive Officer. While we estimate that we need a minimum~~the date of ~~$1,800,000 in additional working capital~~this filing will not be sufficient to ~~provide sufficient funds to pay our operating expenses and~~ fund ~~our development over~~its anticipated level of operations for the next 12 ~~months, we believe that if we are successful~~months; (iii) the ~~anticipated revenues from Daily Engage Media~~Company will have a significant impact on our revenues and results of operations in future periods. While we have engaged a placement agent to assist us in raising capital privately on a best efforts basis, we do not have any firm commitmentsrequire additional financing for ~~this capital and any delay in raising sufficient funds will delay~~ the implementation of our business strategy and could adversely impact our ability to significantly increase our revenues in future periods. In addition, if we are unable to raise the necessary additional working capital, absent a significant increase in our revenues, most particularly from Daily Engage Media, of which there is no assurance, we will be unablefiscal year ending December 31, 2022 to continue at its expected level of operations; and (iv) if the Company fails to ~~grow our company and may~~obtain the needed capital, it will be forced to ~~reduce certain operating expenses in an effort~~delay, scale back, or eliminate some or all of its development activities or perhaps cease operations. In the opinion of management, these factors, among others, raise substantial doubt about the ability of the Company to ~~conserve our working capital.~~continue as a going concern as of the date of the end of the period covered by this report and for one year from the issuance of these consolidated financial statements.

~~Going Concern~~

For the nine months ended September 30, 2017, we reported a net loss of $(2,103,981), cash used in operating activities of $1,372,589 and we had an accumulated deficit of $(10,928,787) at September 30, 2017. The report of our independent registered public accounting firm on our audited consolidated financial statements at December 31, ~~2016~~2021 and ~~2015~~2020 and for the years then ended ~~contains~~contained an explanatory paragraph regarding substantial doubt of our ability to continue as a going concern based upon our net losses, cash used in operations and accumulated deficit. These factors, among others, raise substantial doubt about our ability to continue as a going concern. Our unaudited condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. There are no assurances we will be successful into manage our ~~efforts~~working capital deficit, or to ~~generate revenues~~manage our cash versus liabilities, or ~~report profitable operations~~our ability to continue obtaining investment capital and loans from related parties and outside investors or to continue as a going concern, in which event investors would lose their entire investment in our company.

~~Results~~Our ability to fully implement the Bright Mountain Media Ad Exchange Network and maximize the value of ~~operations~~

Third Quarter
2017

Third Quarter
2016

% Change

Product sales

$
589,402

$
292,235

102

Revenues from advertising

131,223

113,502

16

Total revenues

$
720,625

$
405,737

78

Cost of sales – products

387,360

229,391

70

Cost of sales - products as a percentage of product sales

65.7
%

78.5
%

Cost of sales - advertising

4,396

826

Cost of sales – adversting as a percent of advertising revenue

3.4
%

0.72
%

Gross profit

$
328,869

$
175,520

78

Gross profit as a percentage of total revenues

45.6
%

43.3
%

Selling, general and administrative expenses

$
801,307

$
686,802

17

(Loss) from operations

$
(472,438
)

$
(511,282
)

-8

Nine Months Ended
September 30,
2017

Nine Months Ended
September 30,
2016

% Change

Product sales

$
1,713,688

$
976,056

76

Revenues from advertising

334,856

313,266

7

Total revenues

$
2,048,544

$
1,289,322

59

Cost of sales – products

1,116,465

732,536

54

Cost of sales - products as a percentage of product sales

65.2
%

75.1
%

Cost of sales - advertising

16,758

5,202

Cost of sales – adversting as a percent of advertising revenue

5.0
%

1.7
%

Gross profit

$
915,321

$
551,584

66

Gross profit as a percentage of total revenues

44.7
%

42.8
%

Selling, general and administrative expenses

2,750,275

2,202,855

25

(Loss) from operations

$
(1,834,954
)

$
(1,654,271
)

11

~~Revenue~~

~~Presently, we generate revenue from two segments: product sales~~our assets are dependent upon our ability to raise additional capital sufficient for our short-term and advertising which includes advertising revenue and subscriptions. Revenues related to product sales increased during both the three and nine months ended September 30, 2017 from the comparable period in 2016 which are attributable to our acquisition of the Black Helmet Apparel business in mid-December 2016. Sales by our Black Helmet Apparel business totaled $279,162 and $784,861 during the three and nine months ended September 30, 2017, respectively, compared to their pre-acquisition sales of $226,164 and $692,214 for the comparable periods in 2016, as included in our pro-forma disclosure in Note 3 – Acquisitions. While there can be no assurance, we expect a similar increase quarter-over-quarter during the fourth quarter of 2017 resulting from this acquisition.

Advertising revenues increased 16% for the third quarter of 2017 and 7% for the nine months ended September 30, 2017 over the comparable periods in 2016 which is attributable to Daily Engage Media for the period of September 19, 2017 through September 30, 2017 following our acquisition of it in mid-September 2017. Sales by Daily Engage business totaled $1,030,476 during the first nine months of 2017 compared to their pre-acquisition sales of $435,026 for the first nine months of 2016, as included in our pro-forma disclosure in Note 3 – Acquisitions. Daily Engage Media sales totaling $32,539 for the period from the date of acquisition through September 30,2017 are included in our results for the three and nine months ended September 30,2017. While there can be no assurance, we expect similar an increase quarter-over-quarter during the remainder of 2017 resulting from this acquisition.

~~Cost of Sales~~

~~Cost of sales as a percentage of product sales remained relatively steady during the third quarter 2017 and the nine months then ended compared to the comparable periods of the prior year.~~long-term growth plans. Historically, we ~~did not recognize any cost of sales for~~have been dependent upon debt financing and equity capital raises to provide adequate funds to meet our services segment, which has now been renamed Advertising following our acquistion of Daily Engage Media during mid-September 2017. We now incur costs of sales associated with this segment which includes revenue share payments to media providers and website publishers.

~~Selling, General and Administrative Expenses~~

Selling, general and administrative expenses increased by approximately 17% and approximately 25% for the three and nine months ended September 30, 2017 from the comparable periods in 2016. Our selling, general and administrative expenses were 111% and 134% of our total revenues for the three and nine months ended September 30, 2017, respectively, as compared to 169% and 171% for the comparable periods in 2016.

A significant portion of our selling, general and administrative expenses between periods was attributable to non-cash expenses recognized during the nine months ended September 30, 2017 and 2016 including amortization expense attributable to intangible assets acquired and amortization of debt discounts of $227,418 and $116,863, respectively. In addition, stock options compensation expense totaled $95,821 and $107,193 in the first nine months 2017 and 2016, respectively.working capital needs. During the 2017 periods we have increased our staffing, including in connection with our acquisition of Black Helmet Apparel, which has increased our employee costs. Advertising and marketing expenses increased sharply between the periods which is attributable to our acquisition of Black Helmet Apparel business during the fourth quarter 2016. For the three months ended September 30, 2017 and 2016, advertising, marketing and promotion expense was $66,436 and $3,050, respectively. For the nine months ended September 30, 2017 and 2016, advertising, marketing and promotion expense was $231,669 and $15,156, respectively. The business modelMarch 31, 2022, we raised $1,400,000 of debt financing (see Note 13 Related Parties for ~~Black Helmet Apparel relies heavily on on-line promotion of products offered. We anticipate these quarter-over-quarter increases~~more information).
While we have engaged a placement agent to ~~continue as the Company focuses on expanding the Black Helmet Apparel customer base and promoting anticipated newly introduced products.~~

~~Selling, general and administrative expenses are expected to continue to increase~~assist us in a controlled manor as we execute our planned growth strategy of increasing website visits both organically and through targeted acquisitions and providing the needed administrative support for the increased level of activities. Subject to the availability of additional workingraising capital, the ~~Company also intends to add administrative staff to its accounting department to improve controls over its accounting and reporting processes.~~
~~Total other income (expense)~~

Total other income (expense) primarily reflects interest expense associated with our borrowings under a non-convertible and several convertible notes. Our Chief Executive Officer loaned the Company an additional $1,460,000 during the first nine months 2017 under a series of 6% to 12% convertible notes bringing the total notes payable to him at September 30, 2017 to $1,147,145 net of the related note discount. Interest under these notes totaled $95,478 and $220,610, inclusive of $49,597 and $116,863 in amortization of the related debt discount, for the three and nine months ended September 30, 2017. In addition, the Company recorded interest of $23,611 and $39,236 during the three and nine months ended September 30, 2017placement agent is acting on a ~~$500,000 25% note payable issued~~best-efforts basis and there are no assurances we will be successful in ~~November 2016 which matures~~raising additional capital during 2022 through the sale of our securities. Any delay in ~~November 2017. On September 30, 2017,~~raising sufficient funds will delay the ~~note was amended, extending the maturity to December 31, 2017 and reducing the interest rate at 10.0%.~~

~~Non-GAAP financial measure~~

We report adjusted net (loss) to measure our overall results because we believe it better reflects our net results by excluding the impact of non-cash equity based compensation. We use Adjusted EBITDA to measure our operations by excluding interest and certain additional non-cash expenses. These measures are one of the primary metrics by which we evaluate the performanceimplementation of our business ~~on which~~strategy and could adversely impact our ~~internal budgets are based. We believe the presentation of adjusted net (loss) and Adjusted EBITDA enhances~~ability to significantly increase our ~~investors' overall understanding of the financial performance of our business.~~

~~We believe that investors have access to the same set of tools that we use~~revenues in ~~analyzing our results. This non-GAAP measure should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for or superior to GAAP results.~~

We believe these measures are useful for analysts and investors as the measures allows a more meaningful year-to-year comparison of our performance. The items below are excluded from the Adjusted EBITDA measure because these items are non-cash in nature, and we believe that by excluding these items, Adjusted EBITDA corresponds more closely to the cash operating income/loss generated from our business. Adjusted EBITDA has certain limitations in that it does not take into account the impact to our statement of operations of certain expenses.

~~The following is an unaudited reconciliation of net (loss) to adjusted net (loss) and Adjusted EBITDA for the periods presented:~~

For the Three Months Ended
September 30,

For the Nine Months Ended
September 30,

(unaudited)

2017

2016

2017

2016

Net (loss)

$
(546,801
)

$
(808,401
)

$
(2,103,981
)

$
(1,989,265
)
plus:

Stock compensation expense

21,983

30,069

95,821

107,193

Stock issued for services

—

9,180

25,860

64,110

Adjusted net (loss):

(524,818
)

(769,152
)

$
(1,982,300
)

$
(1,817,962
)
Depreciation expense

6,777

3,346

18,925

10,025

Amortization expense

75,876

61,582

227,418

186,007

Amortization on debt discount

49,597

—

116,863

305,115

Interest expense

24,766

297,130

152,164

29,900

Adjusted EBITDA:

$
(367,802
)

$
(407,094
)

$
(1,466,930
)

$
(1,286,915
)

~~Liquidity and capital resources~~

Liquidity is the ability of a company to generate sufficient cash to satisfy its needs for cash. As of September 30, 2017 the Company had a balance of cash and cash equivalents of $123,292 and working capital of $148,963 as compared to cash and cash equivalents of $162,795 and working capital of $355,344 at December 31, 2016. Our current assets decreased 11% at September 30, 2017 from December 31, 2016 which reflects the decrease in cash, accounts receivable, prepaid expenses and inventories. Our current liabilities increased 26.7% at September 30, 2017 from December 31, 2016 which primarily reflects a decrease in accounts payable and premium finance loan payable, offset by increases in accrued interest, including to a related party, and notes payable. We do not have any external sources of liquidity and are dependent upon loans from our Chief Executive Officer as described elsewhere herein.future periods. In addition, to the amounts owed Mr. Speyer, in November 2016 we borrowed $500,000 from an unrelated third party under a promissory note which matures in November 2017. On September 30, 2017, the note was amended, extending the maturity to December 31, 2017 and reducing the interest rate at 10.0%. Presently, we do not have sufficient funds to satisfy this unsecured obligation when it becomes due.

~~Our operations do not provide sufficient cash to pay our cash operating expenses. If~~if we are unable to raise the necessary additional working capital, absent a significant increase in our revenues, ~~to a level~~most particularly from our advertising segment, of which ~~provides sufficient funds to pay our operating expenses without relying upon loans from a related party, as well as to pay our obligations as they become due, our ability~~there is no assurance, we will be unable to continue to leverage our resources and implement our plans for continued growth are in jeopardy. During 2017 and 2016 our average monthly negative cash flow was approximately $150,000. As we continue our efforts to grow our ~~business we expect that~~company and may be forced to reduce certain operating expenses to conserve our ~~monthly~~working capital.
37
Summary of cash ~~operating overhead will continue to increase as we add personnel, although at a lesser rate, and we are not able at this time to quantify the amount of this expected increase.~~flows

For the three months ended March 31,

2022 2021
Net cash (used in) operating activities $ (1,241,624 ) $ (222,093 )
Net cash used in investing activities $ - $ (6,564 )
Net cash provided by financing activities $ 1,035,585 $ 1,040,243
~~Cash flows~~

~~Net cash flows used in operating activities totaled $1,372,589 and $1,394,127 for the nine month periods ending September 30, 2017 and 2016, respectively.~~ During the ~~six~~three months ended ~~September 30, 2017,~~March 31, 2022, the Company raised $1,400,000 of debt financing which was used primarily to fund our working capital. We used cash primarily to fund our net loss of $2,116,857.
During the three months ended March 31, 2021, we used cash primarily to fund our net loss of ~~$2,103,981~~$1,709,275 for the ~~period as well as increases in accrued interest, including to a related party. Cash used during the nine months ended September 30, 2016 was primarily attributable to operational losses during the~~ period.

Net cash flows used in investing activities totaled $213,878 and $177,961 for the first nine months of 2017 and 2016, respectively. Cash used included the purchase of fixed assets in 2017 of $14,305 and cash used in the acquisition of Daily Engage Media of $199,573 and in 2016, $142,925 attributable to the purchase of two websites and $35,036 attributable to the purchase of fixed assets.

Net cash flows provided from financing activities totaled $1,546,964 and $1,258,242 during the nine month periods ending September 30, 2017 and 2016, respectively. During the first nine months of 2017, the Company received $1,460,000 under a series of 6%, 10%, and 12% 5-year convertible notes issued to our Chief Executive Officer. This figure was reduced by the repayments of $53,643 in insurance premium financing notes. During the first nine months of 2016, the Company sold $500,000 in debt and issued $300,000 in 12%, 5-year convertible notes issued to our Chief Executive Officer. This figure was reduced by the repayments of $41,758 in insurance premium financing notes.

Critical accounting policies

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenue and expenses during the reported periods. The more critical accounting estimates include estimates related to revenue recognition and accounts receivable allowances. We also have other key accounting policies, which involve the use of estimates, judgments and assumptions that are significant to understanding our results, which are described in Note 1 to our unaudited condensed consolidated financial statements appearing elsewhere in this report.

Recent accounting pronouncements

The recent accounting standards that have been issued or proposed by the FASB or other standards-setting bodies as described in Note 13 appearing earlier in this report that do not require adoption until a future date are not expected to have a material impact on the financial statements upon adoption.

All other newly issued accounting pronouncements, but not yet effective, have been deemed either immaterial or not applicable.

~~Off balance sheet arrangements~~

As of the date of this report, we do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors. The term “off-balance sheet arrangement” generally means any transaction, agreement or other contractual arrangement to which an entity unconsolidated with us is a party, under which we have any obligation arising under a guarantee contract, derivative instrument or variable interest or a retained or contingent interest in assets transferred to such entity or similar arrangement that serves as credit, liquidity or market risk support for such assets.

ITEM 3.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not applicable for a smaller reporting company.

ITEM 4.
CONTROLS AND PROCEDURES.
Evaluation of Disclosure Controls and Procedures. We maintain “disclosure controls and procedures” as such term is defined in Rule 13a-15(e) under Securities Exchange Act of 1934 (the “Exchange Act”). In designing and evaluating our disclosure controls and procedures, our management recognized that disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of disclosure controls and procedures are met. Additionally, in designing disclosure controls and procedures, our management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible disclosure controls and procedures. The design of any disclosure controls and procedures also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.

38
Based on ~~their~~his evaluation as of the end of the period covered by this report, ~~our Chief Executive Officer and~~ our Chief Financial Officer concluded that our disclosure controls and procedures were not effective such that the information relating to our company, required to be disclosed in our Securities and Exchange Commission reports (i) is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms and (ii) is accumulated and communicated to our management, including our Chief Executive Officer, to allow timely decisions regarding required disclosure as a result of continuing material weaknesses in our internal control over financial reporting as described in our Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2021. A material weakness is a deficiency, or combination of deficiencies, that results in more than a remote likelihood that a material misstatement of annual or interim financial statements will not be prevented or detected.

We have implemented changes and will continue to monitor ~~and evaluate the effectiveness of~~ our internal control over financial reporting on an ongoing basis and are committed to taking further action and implementing additional enhancements or improvements, as necessary and as funds allow. We do not, however, expect that the material weaknesses in our disclosure controls will be remediated until such time as we have added to our accounting and administrative staff allowing improved internal control over financial reporting.

Changes in Internal Control over Financial Reporting.~~There have been no~~ We continue to strategically plan changes in our internal control over financial reporting ~~during our last~~through this fiscal quarter, ~~that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.~~Q1 2022.

PART II - OTHER INFORMATION

ITEM 1.
LEGAL PROCEEDINGS.

~~None.~~None, except as previously disclosed.

ITEM 1A.
RISK FACTORS.

~~Not applicable for a smaller reporting company.~~We incorporate by reference the risk factors disclosed in Part I, Item 1A of our 2021 Form 10-K subject to the new or modified risk factors appearing below that should be read in conjunction with the risk factors disclosed in such Form 10-K.

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

Between September 2017 and November 13, 2017 Mr. W. Kip Speyer, an executive officer and director, purchased 1,125,500 shares of our Series E Stock at a purchase price of $0.40 per share for an aggregate purchase price of $450,000 in a series of private transactions. The designations, rights and preferences of our Series E Preferred are described earlier in this report under Note 3. WeDuring the period from January 1, 2022 through March 31, 2022, Bright Mountain Media, Inc. did not ~~pay~~sell any commissions or finders fees and the proceeds were used by us for working capital. Mr. Speyer is an accredited investor and the purchases were exempt from registration under the Securities Act of 1933, as amended in reliance on an exemption provided by Section 4(a)(2) of that act.equity securities.
Between January 2017 and August 2017 Mr. W. Kip Speyer, an officer and director, lent us an aggregate of $950,000 under the terms of convertible promissory notes. The notes are unsecured, carry an interest rate ranging from 6% to 12%, mature five years from date of issuance and are convertible at any time at the option of the holder into our common stock art conversion prices ranging from $0.50 to $0.40 per share.

We do not pay any commissions or finders fees and the proceeds were used by us for working capital. The recipient is an accredited investor and the issuances were exempt from registration under the Securities Act of 1933, as amended (The “Securities Act”) in reliance on an exemption provided by Section 4(a)(2) of that act.

ITEM 3.
DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4.
MINE SAFETY DISCLOSURES.

~~Not applicable to our company’s operations.~~None.

ITEM 5.
OTHER INFORMATION.

On September 1, 2017 our board of directors designated a series of our blank check preferred stock, consisting of 2,500,000 shares, as 10% Series E Convertible Preferred Stock (the "Series E Stock"). The designations, rights and preferences of the Series E Stock, as amended, is as follows:None.

·
~~the shares have no voting rights, except as may be provided by Florida law;~~
·
~~the stock has a stated value of $0.40 per share and ranks senior to all other classes of our securities, except for our 10% Series A Convertible Preferred Stock;~~
·
~~in the event of a liquidation or winding up of our Company, the holders of the Series E Stock are entitled to a liquidation preference equal to a return of the capital invested;~~
·
the holders of Series E Stock are entitled to receive dividends out of funds legally available for the payment of dividends, at the rate of 10% per annum which are cumulative and payable in cash, payable monthly in arrears within 15 days after the end of each month beginning on the month following the issuance of the shares of Series E Stock. Dividends will accrue regardless of whether the Company has earnings, whether there are funds legally available therefor and/or whether declared. No interest shall be payable with respect to any dividend payment that may be in arrears;
39

·
the shares of Series E Stock are convertible into shares of our common stock on a one for one basis at the option of the holder, subject to automatic conversion by us upon either the five-year anniversary of the date of issuance or in the event of a change of control of our Company as defined in the designations. The conversion formula is subject to proportional adjustment in the event of stock splits, stock dividends and similar corporate events; and
·
~~the shares are redeemable at our option upon 20 days’ notice for an amount equal to the amount of capital invested.~~

As described in Part II, Item 2 of this report, we have issued and sold an aggregate of 1,062,500 shares of our Series E Stock to Mr. Kip Speyer, our Chief Executive Officer. The description of the designations, rights and preferences of the Series E Stock is qualified in its entirety by reference to the Articles of Amendment to the Amended and Restated Articles of Incorporation which is filed as Exhibit 3.10 to this report.

In November 2016, we borrowed $500,000 from a third party and issued an unsecured one year promissory note which bore interest at the rate of 25% per annum. On September 30,2017, the note was amended, extending the maturity to December 31,2017 and reducing the interest rate to 10%. In addition, the note holder reduced the accrued interest due under the note from approximately $106,000 to $50,000 at September 20,2017.

On November 14, 2017 we entered into an Amendment to the Amended and Restated Membership Interest Purchase Agreement dated September 19, 2017 by and among our company, Daily Engage Media and the members of Daily Engage Media which modified the terms of the escrow arrangement for the earnout shares. Under the terms of the amendment, instructions to our transfer agent have been deposited in escrow in lieu of certificates representing the earnout shares. In connection therewith, the parties entered into an Amended and Restated Escrow Agreement. The foregoing descriptions of the terms and conditions of the Amendment to the Amended and Restated Membership Interest Purchase Agreement and the Amended and Restated Escrow Agreement are qualified in their entirety by reference to the agreements which are filed as Exhibits 10.10 and 10.11, respectively, to this report.

ITEM 6. EXHIBITS.
~~EXHIBITS.~~

No.
~~No.~~
Exhibit Description
~~Description~~
Form Date Filed Number Herewith
~~3.10~~
Articles of Amendment to the Amended and Restated Articles of Incorporation *
~~10.1~~
31.1
Amended and Restated Membership Interest Purchase Agreement dated September 19, 2017 by and among Bright Mountain Media, Inc., Daily Engage Media Group LLC and Harry G. Pagoulatos, George G. Rezitis and Angelos Triantafillou (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K as filed on September 25, 2017)
Rule 13a-14(a)/15d-14(a) certification of Principal Executive Officer Filed
~~10.2~~
~~Letter agreement dated September 19, 2017 with Vinay Belani (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K as filed on September 25, 2017)~~
~~10.3~~
31.2
~~Escrow Agreement dated September 19, 2017 by~~Rule 13a-14(a)/15d-14(a) certification of principal financial and among Bright Mountain Media, Inc., Harry G. Pagoulatos, George G. Rezitis, Angelos Triantafillou, Vinay Belani and Pearlman Law Group LLP, as escrow agent (incorporated by reference to Exhibit 10.3 to the Current Report on Form 8-K as filed on September 25, 2017)
accounting officer Filed
~~10.4~~
~~Employment Agreement by and between Bright Mountain Media, Inc. and Harry G. Pagoulatos (incorporated by reference to Exhibit 10.4 to the Current Report on Form 8-K as filed on September 25, 2017)~~
~~10.5~~
32.1
~~Employment Agreement by and between Bright Mountain Media, Inc. and George G. Rezitis (incorporated by reference to Exhibit 10.5 to the Current Report on Form 8-K as filed on September 25, 2017)~~
~~10.6~~
Promissory Note in the principal amount of $100,000 dated September 19, 2017 payable to Harry G. Pagoulatos (incorporated by reference to Exhibit 10.6 to the Current Report on Form 8-K as filed on September 25, 2017)
~~10.7~~
Promissory Note in the principal amount of $100,000 dated September 19, 2017 payable to George G. Rezitis (incorporated by reference to Exhibit 10.7 to the Current Report on Form 8-K as filed on September 25, 2017)
~~10.8~~
Promissory Note in the principal amount of $100,000 dated September 19, 2017 payable to Angelos Triantafillou (incorporated by reference to Exhibit 10.8 to the Current Report on Form 8-K as filed on September 25, 2017)
~~10.9~~
Promissory Note in the principal amount of $80,000 dated September 19, 2017 payable to Vinay Belani (incorporated by reference to Exhibit 10.9 to the Current Report on Form 8-K as filed on September 25, 2017)
~~10.10~~
Amendment to Amended and Restated Membership Interest Purchase Agreement dated November 14, 2017 by and among Bright Mountain Media, Inc., Daily Engage Media Group LLC, Harry G. Pagoulatos, George G. Rezitis and Angelos Triantafillou *

~~10.11~~
Amended and Restated Escrow Agreement dated November 14, 2017 by and among Bright Mountain Media, Inc., Harry G. Pagoulatos, George G. Rezitis, Angelos Triantafillou, Vinay Belani and Pearlman Law Group LLP, as escrow agent *
~~31.1~~
Rule 13a-14(a)/ 15d-14(a) Certification of Chief Executive Officer *
~~31.2~~
Rule 13a-14(a)/ 15d-14(a) Certification of Chief Financial Officer *
~~32.1~~
Section 1350 ~~Certification~~certification of ~~Chief~~Principal Executive Officer and Chief Financial Officer*
principal financial and accounting officer Filed
~~101.INS~~
101.INS Inline XBRL Instance Document *
Filed
~~101.PRE~~
101.SCH Inline XBRL Taxonomy Extension Schema Document Filed
101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document Filed
101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document Filed
101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document Filed
101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase *
Document Filed
~~101.LAB~~
XBRL Taxonomy Extension Label Linkbase *
~~101.DEF~~
104
Cover Page Interactive Data File (embedded within the Inline XBRL Taxonomy Extension Definition Linkbase *
~~101.SCH~~
document)
XBRL Taxonomy Extension Schema *
~~101.CAL~~
XBRL Taxonomy Extension Calculation Linkbase *
~~———————~~
40
*SIGNATURES
~~filed herewith~~

~~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.

BRIGHT MOUNTAIN MEDIA, INC.
June 30, 2022 By: /s/ Matthew Drinkwater
Matthew Drinkwater, Chief Executive Officer,
Principal Executive Officer
~~November 20, 2017~~
By:
/s/ ~~W. Kip Speyer~~
Edward A. Cabanas
~~W. Kip Speyer, Chief Executive Officer~~
~~November 20, 2017~~
~~By:~~
~~/s/ Dennis W. Healey~~
~~Dennis W. Healey,~~Edward A. Cabanas, Chief Financial Officer, Principal
Financial and Accounting Officer

41

36


		Page No.
	PART I - FINANCIAL INFORMATION

ITEM 1.	FINANCIAL STATEMENTS.	1 4

ITEM 2.	~~MANAGEMENT'S~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.	26 33

ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.	32 38

ITEM 4.	CONTROLS AND PROCEDURES.	32 38

	PART II - OTHER INFORMATION

ITEM 1.	LEGAL PROCEEDINGS.	33 39

ITEM 1A.	RISK FACTORS.	33 39

ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.	33 39

ITEM 3.	DEFAULTS UPON SENIOR SECURITIES.	33 39

ITEM 4.	MINE SAFETY DISCLOSURES.	33 39

ITEM 5.	OTHER INFORMATION.	33 39

ITEM 6.	EXHIBITS.	34 40


	September 30			December 31,
	2017			2016
	*(unaudited)*
ASSETS
Current assets
Cash	$	123,292		$	162,795
Accounts Receivable, net		223,396			157,013
Prepaid Expenses and Other Current Assets		71,727			132,950
Inventories		984,522			1,127,072
Total current assets		1,402,937			1,579,830
Fixed Assets, net		94,382			99,001
Intangible Assets, net		1,231,776			967,114
Goodwill		502,823			—
Tradenames		300,000			150,000
Other Assets		49,497			184,400
Total Assets	$	3,581,415		$	2,980,345

LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Accounts Payable and Accrued Expense	$	525,308		$	654,140
Accrued Interest		50,347			11,111
Accrued Interest to Related Party		16,550			5,592
Premium Finance Loan Payable		—			53,643
Deferred Rent		16,692			—
Other Current Liabilities		16,237			—
Notes Payable		926,766			500,000
Total Current Liabilities		1,551,900			1,224,486

Long Term Debt to Related Parties, net of debt discount of $887,855 and $389,095		1,147,145			185,905
Total Liabilities		2,699,045			1,410,391
Commitments and contingencies (See Note 9)
Shareholders' Equity
Preferred stock, par value $0.01, 20,000,000 shares authorized,
600,000 and 100,000 shares issued and outstanding
Series A, 2,000,000 shares designated, 100,000 and
100,000 shares issued and outstanding		1,000			1,000
Series B, 1,000,000 shares designated, 0 and
0 shares issued and outstanding		—			—
Series C, 2,000,000 shares designated, 0 and
0 shares issued and outstanding		—			—
Series D, 2,000,000 shares designated, 0 and
0 shares issued and outstanding		—			—
Series E, 2,500,000 shares designated		5,000			—
500,000 and 0 issued and outstanding
Common stock, par value $0.01, 324,000,000 shares authorized,
46,168,864 issued and outstanding and 44,901,531 issued
and outstanding, respectively		461,689			449,016
Additional paid-in capital		11,343,468			9,944,744
Accumulated Deficit		(10,928,787	)		(8,824,806	)
Total shareholders' equity		882,370			1,569,954
Total liabilities and shareholders' equity	$	3,581,415		$	2,980,345


	For the Three Months Ended						For the Nine Months Ended
	September 30,						September 30,
	2017			2016			2017			2016

Product Sales	$	589,402		$	292,235		$	1,713,688		$	976,056
Revenues from Advertising		131,223			113,502			334,856			313,266
Total revenues		720,625			405,737			2,048,544			1,289,322

Cost of sales - Product		387,360			229,391			1,116,465			732,536
Cost of Revenues - Advertising		4,396			826			16,758			5,202
Gross profit		328,869			175,520			915,321			551,584

Selling, general and administrative expenses		801,307			686,802			2,750,275			2,205,855
Loss from operations		(472,438	)		(511,282	)		(1,834,954	)		(1,654,271	)

Other income (expense)
Interest income		232			11			451			21
Interest expense		20,883			—			(48,868	)		—
Interest expense - related party		(95,478	)		(297,130	)		(220,610	)		(335,015	)
Total other income (expense)		(74,363	)		(297,119	)		(269,027	)		(334,994	)

Net loss before income taxes		(546,801	)		(808,401	)		(2,103,981	)		(1,989,265	)
Income taxes		—			—			—			—

Net loss		(546,801	)		(808,401	)		(2,103,981	)		(1,989,265	)

Preferred stock dividends
Series A, Series B, Series C, Series D, and Series E preferred stock		1,122			60,339			3,849			278,525
Total preferred stock dividends		1,122			60,339			3,849			278,525

Net loss attributable to common shareholders	$	(547,923	)	$	(868,740	)	$	(2,107,830	)	$	(2,267,790	)


Basic and diluted net loss per share	$	(0.01	)	$	(0.02	)	$	(0.05	)	$	(0.06	)

Weighted average shares outstanding - basic and diluted		45,126,811			40,848,279			44,973,345			38,220,591


									Additional						Total
	Preferred Stock				Common Stock				Paid-in			Accumulated			Shareholders'
	Shares		Amount		Shares		Amount		Capital			Deficit			Equity
Balance – December 31, 2016		100,000	$	1,000		44,901,531	$	449,016	$	9,944,744		$	(8,824,806	)	$	1,569,954

Common stock issued for services ($0.850/share)		—		—		3,600		36		3,024			—			3,060
Common stock issued for 10% dividend payment pursuant to Series A preferred stock Subscription Agreements		—		—		10,000		100		(100	)		—			—
Issuance of Series E preferred Stock ($0.40/share)		500,000		5,000		—		—		195,000			—			200,000
Stock option compensation expense		—		—		—		—		95,821			—			95,821
Common stock issued as compensation		—		—		28,500		285		22,515			—			22,800
Beneficial conversion feature		—		—		—		—		615,625			—			615,625
Common stock issued for cash ($0.40/share)		—		—		125,000		1,250		48,750			—			50,000
Common stock issued in acquisition						1,100,233		11,002		418,089			—			429,091
Net loss for the nine months ended September 30, 2017		—		—		—		—		—			(2,103,981	)		(2,103,981	)
Balance – September 30, 2017		600,000	$	6,000		46,168,864	$	461,689	$	11,343,468		$	(10,928,787	)	$	882,370


Customer and related relationships	$	39,578
Website		177,690
Total	$	217,268


Inventory	$	58,000
Intangibles – website		80,000
Intangibles – trade name		150,000
Intangibles – customer relationships		252,000
Intangibles – non-compete agreements		120,000
Total assets acquired	$	660,000


	Three Months Ended			Nine Months Ended
	September 30,			September 30,
	2016			2016
Total revenue	$	925,691		$	2,416,562
Total expenses		1,989,494			5,064,116
Preferred stock dividend		60,339			278,525
Net loss attributable to common shareholders	$	(1,124,142	)	$	(2,926,079	)
Basic and diluted net loss per share	$	(0.03	)	$	(0.07	)


Tangible assets acquired	$	106,534
Liabilities assumed		(237,855	)
Exchange platform		50,000
Tradename		150,000
Customer relationships		250,000
Non-compete agreements		192,000
Goodwill		502,823
Total purchase price	$	1,013,502


	September 30,			December 31,			Depreciable Life
	2017			2016			(Years)
Furniture and Fixtures	$	76,671		$	70,108		7
Computer Equipment		59,511			56,142		5
Leasehold Improvements		39,385			35,011		10
Total Fixed Assets		175,567			161,261
Less: Accumulated Depreciation		(81,185	)		(62,260	)
Total Fixed Assets, net	$	94,382		$	99,001


	For the three months ended September 30, 2017								For the three months ended September 30, 2016
	Products			Advertising		Total			Products			Advertising			Total
Revenues	$	589,402		$	131,233	$	720,625		$	292,235		$	113,502		$	405,737
Intangible assets amortization	$	—		$	75,876	$	75,876		$	—		$	61,582		$	61,582
Depreciation	$	6,440		$	337	$	6,777		$	2,426		$	920		$	3,346
Income/(Loss) from operations	$	(541,619	)	$	69,181	$	(472,438	)	$	(300,803	)	$	(210,479	)	$	(511,282	)
Segment assets	$	1,429,824		$	2,151,591	$	3,581,415		$	1,352,158		$	856,317		$	2,208,475
Purchase of assets	$	—		$	199,573	$	199,573		$	29,415		$	11,688		$	41,103


Issuance Date	Maturity Date	Principal		Discount Recognized		Amortization Expense 2016		Carry Amount at December 31, 2016		Amortization Nine Months Ended September 30, 2017		Carry Amount at September 30, 2017

09/26/16	09/26/21	$	100,000	$	70,000	$	3,692	$	33,692	$	10,500	$	44,192
10/14/16	10/14/21		100,000		70,000		3,024		33,024		10,500		43,524
10/31/16	10/31/21		100,000		70,000		2,372		32,372		10,500		42,872
11/03/16	11/03/21		50,000		35,000		1,120		16,120		5,250		21,370
11/11/16	11/11/21		100,000		70,000		1,934		31,934		10,500		42,434
11/21/16	11/21/21		50,000		35,000		775		15,775		5,250		21,025
12/15/16	12/15/21		75,000		52,500		488		22,988		7,874		30,864
01/19/17	01/19/22		100,000		70,000		—		—		9,823		39,823
02/06/17	02/06/22		100,000		70,000		—		—		9,061		39,061
02/24/17	02/24/22		50,000		35,000		—		—		3,708		18,708
03/07/17	03/07/22		100,000		70,000		—		—		7,941		37,941
04/03/17	04/03/22		75,000		45,000		—		—		4,500		34,500
04/10/17	04/10/22		75,000		45,000		—		—		4,250		34,250
04/19/17	04/19/22		50,000		30,000		—		—		2,683		22,683
05/01/17	05/01/22		50,000		30,000		—		—		2,500		22,500
05/11/17	05/11/22		75,000		22,500		—		—		1,742		54,242
05/24/17	05/24/22		75,000		45,000		—		—		3,484		33,484
06/08/17	06/08/22		100,000		30,000		—		—		1,883		71,883
06/27/17	06/27/22		100,000		30,000		—		—		1,567		71,567
07/12/17	07/12/22		50,000		5,000		—		—		220		45,220


	Nine Months Ended September 30,
Assumptions:	2017			2016
Expected term (years)	6.25				6.25
Expected volatility		52	%		63	%
Risk-free interest rate		1.99	%		0.38	%
Dividend yield		0	%		0	%
Expected forfeiture rate		0	%		0	%


	Options Outstanding				Options Exercisable
Range or Exercise Price	Number Outstanding	Remaining Average Contractual Life (In Years)	Weighted Average Exercise Price		Number Exercisable	Weighted Average Exercise Price		Remaining Average Conversion Life (In Years)
0.14 - 0.24	720,000	1.1	$	0.14	720,000	$	0.14	1.1
0.25 - 0.49	351,000	1.7	$	0.28	351,000	$	0.28	1.6
0.50 - 0.85	1,116,000	3.1	$	0.69	569,000	$	0.60	1.2
	2,187,000	5.9	$	0.45	1,640,000	$	0.31	3.8


	Three Months Ended September 30,						Nine Months Ended September 30,
	2017			2016			2017			2016

Citizens		52	%		37	%		58	%		40	%
Bulova		17	%		18	%		18	%		18	%

	●	non-cash stock option compensation expense;
	●	depreciation;
	●	equity raise expenses;
	●	professional fees;
	●	acquisition-related items consisting of amortization expense and impairment expense;
	●	interest; and
	●	amortization on debt discount.

	For the Three Months Ended March 31,
	2022			2021

Net (loss) before tax	$	(2,116,857	)	$	(1,709,275	)
plus:
Stock compensation expense		145,665			170,048
Depreciation expense		3,385			18,047
Amortization expense		396,266			396,266
Gain on forgiveness of PPP loan		(841,540	)		(1,706,735	)
Professional fees		143,284			45,000
Amortization on debt discount		279,978			3,452
Bad debt		271,355			-
Capital raise expenses		261			-
Interest expense		13			260,995
Interest expense – related party		839,417			35,288
Adjusted EBITDA	$	(878,773	)	$	(2,486,914	)


	Third Quarter 2017			Third Quarter 2016			% Change
Product sales	$	589,402		$	292,235			102
Revenues from advertising		131,223			113,502			16
Total revenues	$	720,625		$	405,737			78
Cost of sales – products		387,360			229,391			70
Cost of sales - products as a percentage of product sales		65.7	%		78.5	%
Cost of sales - advertising		4,396			826
Cost of sales – adversting as a percent of advertising revenue		3.4	%		0.72	%
Gross profit	$	328,869		$	175,520			78
Gross profit as a percentage of total revenues		45.6	%		43.3	%
Selling, general and administrative expenses	$	801,307		$	686,802			17
(Loss) from operations	$	(472,438	)	$	(511,282	)		-8

	Nine Months Ended September 30, 2017			Nine Months Ended September 30, 2016			% Change
Product sales	$	1,713,688		$	976,056			76
Revenues from advertising		334,856			313,266			7
Total revenues	$	2,048,544		$	1,289,322			59
Cost of sales – products		1,116,465			732,536			54
Cost of sales - products as a percentage of product sales		65.2	%		75.1	%
Cost of sales - advertising		16,758			5,202
Cost of sales – adversting as a percent of advertising revenue		5.0	%		1.7	%
Gross profit	$	915,321		$	551,584			66
Gross profit as a percentage of total revenues		44.7	%		42.8	%
Selling, general and administrative expenses		2,750,275			2,202,855			25
(Loss) from operations	$	(1,834,954	)	$	(1,654,271	)		11


	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
(unaudited)	2017			2016			2017			2016
Net (loss)	$	(546,801	)	$	(808,401	)	$	(2,103,981	)	$	(1,989,265	)
plus:
Stock compensation expense		21,983			30,069			95,821			107,193
Stock issued for services		—			9,180			25,860			64,110
Adjusted net (loss):		(524,818	)		(769,152	)	$	(1,982,300	)	$	(1,817,962	)
Depreciation expense		6,777			3,346			18,925			10,025
Amortization expense		75,876			61,582			227,418			186,007
Amortization on debt discount		49,597			—			116,863			305,115
Interest expense		24,766			297,130			152,164			29,900
Adjusted EBITDA:	$	(367,802	)	$	(407,094	)	$	(1,466,930	)	$	(1,286,915	)


	·	~~the shares have no voting rights, except as may be provided by Florida law;~~

	·	~~the stock has a stated value of $0.40 per share and ranks senior to all other classes of our securities, except for our 10% Series A Convertible Preferred Stock;~~

	·	~~in the event of a liquidation or winding up of our Company, the holders of the Series E Stock are entitled to a liquidation preference equal to a return of the capital invested;~~

	·	the holders of Series E Stock are entitled to receive dividends out of funds legally available for the payment of dividends, at the rate of 10% per annum which are cumulative and payable in cash, payable monthly in arrears within 15 days after the end of each month beginning on the month following the issuance of the shares of Series E Stock. Dividends will accrue regardless of whether the Company has earnings, whether there are funds legally available therefor and/or whether declared. No interest shall be payable with respect to any dividend payment that may be in arrears;
		39


	·	the shares of Series E Stock are convertible into shares of our common stock on a one for one basis at the option of the holder, subject to automatic conversion by us upon either the five-year anniversary of the date of issuance or in the event of a change of control of our Company as defined in the designations. The conversion formula is subject to proportional adjustment in the event of stock splits, stock dividends and similar corporate events; and

	·	~~the shares are redeemable at our option upon 20 days’ notice for an amount equal to the amount of capital invested.~~

No.
~~No.~~	Exhibit Description	~~Description~~	Form	Date Filed	Number	Herewith
~~3.10~~		Articles of Amendment to the Amended and Restated Articles of Incorporation *
~~10.1~~ 31.1		Amended and Restated Membership Interest Purchase Agreement dated September 19, 2017 by and among Bright Mountain Media, Inc., Daily Engage Media Group LLC and Harry G. Pagoulatos, George G. Rezitis and Angelos Triantafillou (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K as filed on September 25, 2017) Rule 13a-14(a)/15d-14(a) certification of Principal Executive Officer					Filed
~~10.2~~		~~Letter agreement dated September 19, 2017 with Vinay Belani (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K as filed on September 25, 2017)~~
~~10.3~~ 31.2		~~Escrow Agreement dated September 19, 2017 by~~Rule 13a-14(a)/15d-14(a) certification of principal financial and among Bright Mountain Media, Inc., Harry G. Pagoulatos, George G. Rezitis, Angelos Triantafillou, Vinay Belani and Pearlman Law Group LLP, as escrow agent (incorporated by reference to Exhibit 10.3 to the Current Report on Form 8-K as filed on September 25, 2017) accounting officer					Filed
~~10.4~~		~~Employment Agreement by and between Bright Mountain Media, Inc. and Harry G. Pagoulatos (incorporated by reference to Exhibit 10.4 to the Current Report on Form 8-K as filed on September 25, 2017)~~
~~10.5~~ 32.1		~~Employment Agreement by and between Bright Mountain Media, Inc. and George G. Rezitis (incorporated by reference to Exhibit 10.5 to the Current Report on Form 8-K as filed on September 25, 2017)~~
~~10.6~~		Promissory Note in the principal amount of $100,000 dated September 19, 2017 payable to Harry G. Pagoulatos (incorporated by reference to Exhibit 10.6 to the Current Report on Form 8-K as filed on September 25, 2017)
~~10.7~~		Promissory Note in the principal amount of $100,000 dated September 19, 2017 payable to George G. Rezitis (incorporated by reference to Exhibit 10.7 to the Current Report on Form 8-K as filed on September 25, 2017)
~~10.8~~		Promissory Note in the principal amount of $100,000 dated September 19, 2017 payable to Angelos Triantafillou (incorporated by reference to Exhibit 10.8 to the Current Report on Form 8-K as filed on September 25, 2017)
~~10.9~~		Promissory Note in the principal amount of $80,000 dated September 19, 2017 payable to Vinay Belani (incorporated by reference to Exhibit 10.9 to the Current Report on Form 8-K as filed on September 25, 2017)
~~10.10~~		Amendment to Amended and Restated Membership Interest Purchase Agreement dated November 14, 2017 by and among Bright Mountain Media, Inc., Daily Engage Media Group LLC, Harry G. Pagoulatos, George G. Rezitis and Angelos Triantafillou *


~~10.11~~	Amended and Restated Escrow Agreement dated November 14, 2017 by and among Bright Mountain Media, Inc., Harry G. Pagoulatos, George G. Rezitis, Angelos Triantafillou, Vinay Belani and Pearlman Law Group LLP, as escrow agent *
~~31.1~~	Rule 13a-14(a)/ 15d-14(a) Certification of Chief Executive Officer *
~~31.2~~	Rule 13a-14(a)/ 15d-14(a) Certification of Chief Financial Officer *
~~32.1~~	Section 1350 ~~Certification~~certification of ~~Chief~~Principal Executive Officer and Chief Financial Officer* principal financial and accounting officer	Filed
~~101.INS~~
101.INS	Inline XBRL Instance Document *	Filed
~~101.PRE~~
101.SCH	Inline XBRL Taxonomy Extension Schema Document	Filed

101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document	Filed

101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document	Filed

101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document	Filed

101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase * Document	Filed
~~101.LAB~~	XBRL Taxonomy Extension Label Linkbase *
~~101.DEF~~ 104	Cover Page Interactive Data File (embedded within the Inline XBRL Taxonomy Extension Definition Linkbase *
~~101.SCH~~ document)	XBRL Taxonomy Extension Schema *
~~101.CAL~~	XBRL Taxonomy Extension Calculation Linkbase *


	BRIGHT MOUNTAIN MEDIA, INC.

June 30, 2022	By:	/s/ Matthew Drinkwater
		Matthew Drinkwater, Chief Executive Officer, Principal Executive Officer

~~November 20, 2017~~	By:	/s/ ~~W. Kip Speyer~~ Edward A. Cabanas
			~~W. Kip Speyer, Chief Executive Officer~~

~~November 20, 2017~~	~~By:~~	~~/s/ Dennis W. Healey~~
		~~Dennis W. Healey,~~Edward A. Cabanas, Chief Financial Officer, Principal Financial and Accounting Officer