Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2020 | Jun. 30, 2020 | |
Cover [Abstract] | |||
Entity Registrant Name | theMaven, Inc. | ||
Entity Central Index Key | 0000894871 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2018 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | No | ||
Entity Interactive Data Current | No | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business Flag | true | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 15,478,406 | ||
Entity Common Stock, Shares Outstanding | 175,597,695 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2018 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 2,406,596 | $ 619,249 |
Restricted cash | 120,693 | 3,000,000 |
Factor receivables | 6,130,674 | 53,202 |
Contract fulfillment costs | 17,056 | 14,147 |
Prepayments and other current assets | 858,323 | 174,369 |
Total current assets | 9,533,342 | 3,860,967 |
Property and equipment, net | 68,830 | 54,670 |
Platform development, net | 4,707,956 | 2,633,057 |
Intangible assets, net | 15,403,758 | 20,000 |
Other long term assets | 119,630 | |
Goodwill | 7,324,287 | |
Total assets | 37,157,803 | 6,568,694 |
Current liabilities: | ||
Accounts payable | 4,943,767 | 162,308 |
Accrued expenses | 2,382,047 | 150,136 |
Line of credit | 1,048,194 | |
Liquidated damages payable | 3,647,598 | |
Contract liabilities | 396,407 | 31,437 |
Warrant derivative liabilities | 1,364,235 | |
Embedded derivative liabilities | 7,387,000 | 72,563 |
Officer promissory notes, including accrued interest of $12,574 | 680,399 | |
Total current liabilities | 21,849,647 | 416,444 |
Investor demand payable | 3,000,000 | |
Contract liabilities, net of current portion | 252,500 | |
Deferred rent | 46,335 | |
Other long term liability | 242,310 | |
Convertible debt | 7,270,939 | |
Total liabilities | 29,661,731 | 3,416,444 |
Commitments and contingencies (Note 23) | ||
Mezzanine equity: | ||
Total mezzanine equity | 18,213,992 | 168,496 |
Stockholders' (deficiency) equity: | ||
Common stock, $0.01 par value, authorized 1000,000,000 shares; issued and outstanding: 35,768,619 and 28,516,009 shares at December 31, 2018 and 2017, respectively | 357,685 | 285,159 |
Common stock to be issued | 51,272 | |
Additional paid-in capital | 23,413,077 | 11,170,666 |
Accumulated deficit | (34,539,954) | (8,472,071) |
Total stockholders' (deficiency) equity | (10,717,920) | 2,983,754 |
Total liabilities, mezzanine equity and stockholders' (deficiency) equity | 37,157,803 | 6,568,694 |
Series G Redeemable and Convertible Preferred Stock [Member] | ||
Mezzanine equity: | ||
Convertible preferred stock | 168,496 | 168,496 |
Series H Convertible Preferred Stock [Member] | ||
Mezzanine equity: | ||
Convertible preferred stock | $ 18,045,496 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued | 35,768,619 | 28,516,009 |
Common stock, shares outstanding | 35,768,619 | 28,516,009 |
Series G Redeemable and Convertible Preferred Stock [Member] | ||
Temporary equity, par value | $ 0.01 | $ 0.01 |
Temporary equity, liquidation preference per share value | $ 1,000 | $ 1,000 |
Temporary equity, liquidation preference value | $ 168,496 | $ 168,496 |
Temporary equity, shares authorized | 1,800 | 1,800 |
Temporary equity, shares issued | 168.496 | 168.496 |
Temporary equity, shares outstanding | 168.496 | 168.496 |
Temporary equity, common shares issuable upon conversion | $ 188,791 | $ 98,698 |
Series H Convertible Preferred Stock [Member] | ||
Temporary equity, par value | $ 0.01 | $ 0.01 |
Temporary equity, liquidation preference per share value | $ 1,000 | $ 1,000 |
Temporary equity, liquidation preference value | $ 19,399,250 | $ 19,399,250 |
Temporary equity, shares authorized | 23,000 | 23,000 |
Temporary equity, shares issued | 19,400 | 19,400 |
Temporary equity, shares outstanding | 19,400 | 19,400 |
Temporary equity, common shares issuable upon conversion | $ 58,787,879 | |
Notes Payable to Officer [Member] | ||
Accrued interest | $ 12,574 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Income Statement [Abstract] | ||
Revenue | $ 5,700,199 | $ 76,995 |
Cost of revenue | 7,641,684 | 1,590,636 |
Gross loss | (1,941,485) | (1,513,641) |
Operating expenses | ||
Research and development | 1,179,944 | 114,873 |
General and administrative | 10,892,443 | 4,720,824 |
Total operating expenses | 12,072,387 | 4,835,697 |
Loss from operations | (14,013,872) | (6,349,338) |
Other (expense) income | ||
Change in valuation of warrant derivative liabilities | 964,124 | |
Change in valuation of embedded derivative liabilities | (2,971,694) | 64,614 |
True-up termination fee | (1,344,648) | |
Settlement of promissory notes receivable | (3,366,031) | |
Interest expense | (2,508,874) | |
Interest income | 22,262 | 411 |
Liquidated damages | (2,940,654) | |
Other income | (129) | |
Total other (expense) income | (12,145,644) | 65,025 |
Loss before income taxes | (26,159,516) | (6,284,313) |
Benefit for income taxes | 91,633 | |
Net loss | (26,067,883) | (6,284,313) |
Deemed dividend on Series H convertible preferred stock | (18,045,496) | |
Net loss attributable to common shareholders | $ (44,113,379) | $ (6,284,313) |
Basic and diluted net loss per common share | $ (1.69) | $ (0.42) |
Weighted average number of common shares outstanding - basic and diluted | 26,128,796 | 14,919,232 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Deficiency) - USD ($) | Common Stock [Member] | Common Stock to be Issued [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Total |
Balance at Dec. 31, 2016 | $ 220,475 | $ 9,375 | $ 2,730,770 | $ (2,187,758) | $ 772,862 |
Balance, shares at Dec. 31, 2016 | 22,047,531 | 8,929 | |||
Issuance of common stock | $ 89 | $ (9,375) | 9,286 | ||
Issuance of common stock, shares | 8,929 | (8,929) | |||
Proceeds from private placement of common stock | $ 61,563 | 5,710,782 | 5,772,345 | ||
Proceeds from private placement of common stock, shares | 6,156,304 | ||||
Common stock issued for investment banking fees | $ 2,815 | 353,499 | 356,314 | ||
Common stock issued for investment banking fees, shares | 281,565 | ||||
Common stock warrants issued for investment banking fees | 126,286 | 126,286 | |||
Exercise of stock options | $ 217 | (217) | |||
Exercise of stock options, shares | 21,680 | ||||
Stock based compensation | 2,240,260 | 2,240,260 | |||
Issuance of restricted stock awards to the board of directors | 2,756,527 | ||||
Net loss | (6,284,313) | (6,284,313) | |||
Balance at Dec. 31, 2017 | $ 285,159 | 11,170,666 | (8,472,071) | 2,983,754 | |
Balance, shares at Dec. 31, 2017 | 28,516,009 | ||||
Proceeds from private placement of common stock | $ 17,000 | 4,233,000 | 4,250,000 | ||
Proceeds from private placement of common stock, shares | 1,700,000 | ||||
Common stock warrants issued for investment banking fees | |||||
Exercise of stock options, shares | 125,000 | ||||
Stock based compensation | 6,191,208 | $ 6,191,208 | |||
Costs incurred in connection with private placement of common stock | $ 600 | (600) | |||
Costs incurred in connection with private placement of common stock, shares | 60,000 | ||||
Cashless exercise of common stock warrants | $ 7,369 | (7,369) | |||
Cashless exercise of common stock warrants, shares | 736,853 | ||||
Cashless exercise of common stock options | $ 1,061 | (1,061) | |||
Cashless exercise of common stock options, shares | 106,154 | ||||
Issuance of restricted stock awards in connection with merger of HubPages | $ 24,000 | (24,000) | |||
Issuance of restricted stock awards in connection with merger of HubPages, shares | 2,399,997 | ||||
Issuance of restricted stock awards to the board of directors | $ 2,065 | (2,065) | |||
Issuance of restricted stock awards to the board of directors, shares | 206,506 | ||||
Forfeiture of restricted stock awards | $ (3,297) | 3,297 | |||
Forfeiture of restricted stock awards, shares | (329,735) | ||||
Issuance of common stock in connection with merger of Say Media | $ 4,328 | $ 50,672 | 1,870,001 | 1,925,001 | |
Issuance of common stock in connection with merger of Say Media, shares | 432,835 | 5,067,167 | |||
Issuance of restricted stock awards in connection with merger of Say Media | $ 20,000 | (20,000) | |||
Issuance of restricted stock awards in connection with merger of Say Media, shares | 2,000,000 | ||||
Beneficial conversion feature on Series H convertible preferred stock | 18,045,496 | 18,045,496 | |||
Deemed dividend on Series H convertible preferred stock | (18,045,496) | (18,045,496) | |||
Net loss | (26,067,883) | (26,067,883) | |||
Balance at Dec. 31, 2018 | $ 357,685 | $ 51,272 | $ 23,413,077 | $ (34,539,954) | $ (10,717,920) |
Balance, shares at Dec. 31, 2018 | 35,768,619 | 5,127,167 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Cash flows from operating activities | ||
Net loss | $ (26,067,883) | $ (6,284,313) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation of property and equipment | 28,857 | 12,469 |
Amortization of platform development and intangible assets | 2,430,867 | 512,252 |
Loss on disposition of assets | 94,875 | |
Amortization of debt discounts | 601,840 | |
Change in valuation of warrant derivative liabilities | (964,124) | |
Change in valuation of embedded derivative liabilities | 2,971,694 | (64,614) |
True-up termination fee | 1,344,648 | |
Settlement of promissory notes receivable | 3,366,031 | |
Loss on extinguishment of debt | 1,350,337 | |
Gain on extinguishment of embedded derivative liabilities | (1,096,860) | |
Write off unamortized debt discount upon extinguishment of debt | 1,269,916 | |
Accretion of original issue discount | 69,596 | |
Accrued interest | 193,416 | |
Liquidated damages | 2,940,654 | |
Stock based compensation | 4,340,824 | 1,625,687 |
Deferred income taxes | (91,633) | |
Change in operating assets and liabilities net of effect of business combinations: | ||
Factor receivables, net | (1,384,333) | (53,202) |
Prepayments and other current assets | (424,373) | (52,783) |
Contract fulfillment costs | (2,909) | (14,147) |
Other long term assets | (22,992) | |
Accounts payable | 1,629,094 | 7,947 |
Accrued expenses | (129,535) | 84,875 |
Contract liabilities | 104,134 | 31,437 |
Other liabilities | 30,179 | |
Net cash used in operating activities | (7,417,680) | (4,194,392) |
Cash flows from investing activities | ||
Purchases of property and equipment | (31,625) | (59,481) |
Capitalized platform development | (2,156,015) | (1,980,118) |
Payments of promissory notes receivable, net of advances for acquisition of business | (3,366,031) | |
Payments for acquisition of businesses, net of cash | (18,035,356) | |
Net cash used in investing activities | (23,589,027) | (2,039,599) |
Cash flows from financing activities | ||
Proceeds from issuance of Series H convertible preferred stock | 12,474,704 | |
Proceeds from investor demand payable | 3,000,000 | |
Proceeds from 8% promissory notes | 1,000,000 | |
Payment of 8% promissory notes | (1,372,320) | |
Proceeds from 10% convertible debentures | 4,775,000 | |
Proceeds from 10% original issue discount convertible debentures | 3,285,000 | |
Proceeds from 12% convertible debentures | 8,950,000 | |
Proceeds from private placement of common stock | 1,250,000 | 6,254,946 |
Payment of issuance costs of Series H convertible preferred stock | (159,208) | |
Repayment of line of credit | (956,254) | |
Proceeds from officer promissory notes | 1,009,447 | |
Repayment of officer promissory notes | (341,622) | |
Net cash provided by financing activities | 29,914,747 | 9,254,946 |
Net (decrease) increase in cash, cash equivalents, and restricted cash | (1,091,960) | 3,020,955 |
Cash, cash equivalents, and restricted cash - beginning of year | 3,619,249 | 598,294 |
Cash, cash equivalents, and restricted cash - end of year | 2,527,289 | 3,619,249 |
Supplemental disclosure of cash flow information | ||
Cash paid for interest | 39,373 | |
Cash paid for income taxes | ||
Noncash investing and financing activities | ||
Reclassification of stock based compensation to platform development | 1,850,384 | 614,573 |
Discount on 8% promissory notes allocated to warrant derivative liabilities | 600,986 | |
Discount on 8% promissory notes allocated to embedded derivative liabilities | 159,601 | |
Discount on 10% convertible debentures allocated to embedded derivative liabilities | 471,002 | |
Discount on 10% original issue discount senior convertible debentures allocated to warrant derivative liabilities | 382,725 | |
Discount on 10% original issue discount senior convertible debentures allocated to embedded derivative liabilities | 49,000 | |
Discount on 12% senior convertible debentures allocated to embedded derivative liabilities | 4,760,000 | |
Liquidated damages recognized upon issuance of 12% senior convertible debentures | 706,944 | |
Aggregate exercise price of common stock options exercised on cashless basis | 21,250 | |
Aggregate exercise price of common stock warrants exercised on cashless basis | 168,423 | |
Reclassification of investor demand payable to stockholders' equity | 3,000,000 | |
Fair value of common stock issued for private placement fees | 150,000 | |
Common stock issued for investment banking fees | 356,314 | |
Deemed dividend on Series H convertible preferred stock | 18,045,496 | |
Common stock warrants issued for investment banking fees | 126,286 | |
Assumption of liabilities in connection with merger of HubPages | 851,114 | |
Common stock issued in connection with merger of Say Media | 1,925,001 | |
Assumption of liabilities and debt in connection with merger of Say Media | 7,629,705 | |
Issuance of Series H convertible preferred stock for private placement fees | $ 669,250 |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Parenthetical) | Dec. 31, 2018 |
Promissory Note [Member] | |
Debt instrument interest rate | 8.00% |
Convertible Debenture 1 [Member] | |
Debt instrument interest rate | 10.00% |
Original Issue Discount Convertible Debentures [Member] | |
Debt instrument interest rate | 10.00% |
Convertible Debenture 2 [Member] | |
Debt instrument interest rate | 12.00% |
Promissory Notes Allocated Warrant Derivative Liabilities [Member] | |
Discount on debt | 8.00% |
Promissory Notes Allocated Embedded Derivative Liabilities [Member] | |
Discount on debt | 8.00% |
Convertible Debentures Allocated Embedded Derivative Liabilities ['Member] | |
Discount on debt | 10.00% |
Original Issue Discount Senior Convertible Debentures allocated Warrant Derivative Liabilities [Member] | |
Discount on debt | 10.00% |
Original Issue Senior Convertible Debentures Allocated Embedded Derivative Liabilities [Member] | |
Discount on debt | 10.00% |
Senior Convertible Debentures Allocated Embedded Derivative Liabilities [Member] | |
Discount on debt | 12.00% |
Senior Convertible Debentures [Member] | |
Discount on debt | 12.00% |
Organization and Basis of Prese
Organization and Basis of Presentation | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Organization and Basis of Presentation | 1. Organization and Basis of Presentation Organization TheMaven, Inc. (the “Maven” or “Company”), was incorporated in Nevada on July 22, 2016 (originally under the Amplify Media Network, Inc. (“Amplify”)). On October 11, 2016, the Company entered into a share exchange agreement with Integrated Surgical Systems, Inc. (“Integrated”), a Delaware corporation incorporated on October 1, 1990. On November 4, 2016, the parties consummated a recapitalization pursuant to the share exchange agreement where Amplify became a wholly-owned subsidiary of the Maven (formerly named Integrated) (as further described in Note 17). Integrated amended its certificate of incorporation to change its name to TheMaven, Inc. on December 2, 2016. Unless the context indicates otherwise, Maven, Maven Coalition, Inc., (“Coalition”), HubPages, Inc. (as described in Note 3) and Say Media, Inc. (as described in Note 3) are together hereinafter referred to as the “Company”). Business Operations The Company operates a technology platform empowering premium publishers who impact, inform, educate and entertain. The Maven technology platform provides digital publishing, distribution and monetization capabilities to its coalition of independent, professionally managed online media publishers (referred to as the “Channel Partner(s)” or the “Maven(s)”). Each Maven joins the coalition by invitation-only and is drawn from professional journalists, subject matter experts, group evangelists and social leaders. Mavens publish content and oversee an online community for their respective channels, leveraging a proprietary, socially driven, mobile-enabled, video-focused technology platform to engage niche audiences within a single network. Generally, Mavens are independently owned strategic partners who receive a share of revenue from the interaction with their content. When they join, Mavens benefit from the state-of-the-art technology of the Company’s platform, allowing them to dramatically upgrade performance. At the same time, advertising revenue is dramatically improved due to the scale the Company has achieved by combining all Mavens onto a single platform and the large and experienced sales organization. They also benefit from the Company’s membership marketing and management systems to further enhance their revenue. Additionally, the lead brand within each vertical creates a halo benefit for all Mavens in the vertical while each of them adds to the breadth and quality of content. While they benefit from these critical performance improvements they also save substantially in costs of technology, infrastructure, advertising sales and member marketing and management. The Company’s growth strategy is to continue to expand the coalition by adding new Mavens in key verticals that management believes will expand the scale of unique users interacting on the Company’s technology platform. In each vertical, the Company seeks to build around a leading brand, surround it with subcategory Maven specialists and further enhance coverage with individual expert contributors. The primary means of expansion is adding Mavens as independent strategic partners. However, in some circumstances the Company will acquire entities that bring crucial technology that will enhance the platform or branded content providers that may serve as the cornerstone of an important vertical. The Company’s common stock is traded on the Over-the-Counter Market under the symbol “MVEN”. Going Concern The Company performed an annual reporting period going concern assessment. Management is required to assess the Company’s ability to continue as a going concern. The consolidated financial statements have been prepared assuming that the company will continue as a going concern, which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. The consolidated financial statements do not include any adjustments that might be necessary if the Company was unable to continue as a going concern. The Company has had a history of recurring losses. The Company’s recurring losses from operations and net capital deficiency have been evaluated by management to determine if the significance of those conditions or events would limit its ability to meet its obligations when due. In part, the operating loss realized in fiscal 2018 was primarily a result of investments in people, infrastructure for the technology platform, and the operations rapidly expanding during fiscal 2018 with the acquisitions of HubPages and Say Media, along with continued costs based on the strategic growth plans in other verticals. As reflected in the consolidated financial statements, the Company had revenues of $5,700,199 through December 31, 2018, and has experienced recurring net losses from operations, negative working capital, and negative operating cash flows. During the year ended December 31, 2018, the Company incurred a net loss attributable to common stockholders of $44,113,379, utilized cash in operating activities of $7,417,680, and as of December 31, 2018, had an accumulated deficit of $34,539,954. The Company has financed its working capital requirements since inception through the issuance of debt and equity securities. In 2020, the Company has also been impacted by the COVID-19 pandemic. Many national governments and sports authorities around the world have made the decision to postpone/cancel high attendance sports events in an effort to reduce the spread of COVID-19. In addition, many governments and businesses have limited non-essential work activity, furloughed, and/or terminated many employees and closed some operations and/or locations, all of which has had a negative impact on the economic environment. As a result of these factors, the Company has experienced a decline in traffic, advertising revenue, and earnings since early March 2020, due to the cancellation of high attendance sports events and the resulting decrease in traffic to the technology platform and advertising revenue. The Company has implemented cost reduction measures in an effort to offset its revenue and earnings declines, while experiencing increased cash flows by growth in digital subscriptions. The extent of the impact on the Company’s operational and financial performance will depend on future developments, including the duration and spread of the COVID-19 pandemic, related group gathering and sports event advisories and restrictions, and the extent and effectiveness of containment actions taken, all of which remain uncertain at the time of issuance of the consolidated financial statements. Management has evaluated whether relevant conditions or events, considered in the aggregate, raise substantial doubt about the Company’s ability to continue as a going concern. Substantial doubt exists when conditions and events, considered in the aggregate, indicate it is probable that a company will not be able to meet its obligations as they become due within one year after the issuance date of its financial statements. Management’s assessment is based on the relevant conditions that are known or reasonably knowable as of December 31, 2020. Management’s assessment of the Company’s ability to meet its future obligations is inherently judgmental, subjective and susceptible to change. The factors that the Company considered important in its going concern analysis, include, but are not limited to, its fiscal 2021 cash flow forecast and its fiscal 2021 operating budget. Management also considered the Company’s ability to refinance or repay its convertible debt through future equity and the impact of the recently implemented cost reduction measures, that offset revenue and earnings declines from COVID-19 pandemic. These factors consider information including, but not limited to, the Company’s financial condition, liquidity sources, obligations due within one year after the issuance date of the consolidated financial statements, the funds necessary to maintain operations and financial conditions, including negative financial trends or other indicators of possible financial difficulty. In particular, the Company’s plan for the: (1) 2021 cash flow forecast, considered the use of our working capital line with FastPay (as described in Note 24) to fund changes in working capital, where it has available credit of approximately $8 million as of the issuance date of these consolidated financial statements, and that it does not anticipate the need for any further borrowings that are subject to the holders approval, from its 12% Amended Senior Secured Notes (as described in Note 24) where it may be permitted to borrow up to an additional $5 million; and (2) 2021 operating budget, considered that approximately sixty-five percent of the Company’s revenue is from recurring subscriptions, generally paid in advance, and that digital subscription revenue, that accounts for approximately thirty percent of subscription revenue, grew approximately thirty percent in 2020 demonstrating the strength of its premium brand, and the plan to continue to grow its subscription revenue from the 2019 acquisition of TheStreet (as described in Note 24) and to launch premium digital subscriptions from its Sports Illustrated licensed brands (as described in Note 24), in January 2021. The Company has considered both quantitative and qualitative factors as part of the assessment that are known or reasonably knowable as of December 31, 2020, and concluded that conditions and events considered in the aggregate, do not raise substantial doubt about the Company’s ability to continue as a going concern for a one-year period following the financial statement issuance date. Reclassifications Certain comparative amounts as of and for the year ended December 31, 2017 have been reclassified to conform to the current period’s presentation. These reclassifications were immaterial, both individually and in the aggregate. These changes did not impact previously reported loss from operations or net loss. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Principles of Consolidation The accompanying consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and include the financial statements of Maven and its wholly-owned subsidiaries, Coalition, and HubPages, Inc. (“HubPages”) a new wholly-owned subsidiary formed on March 13, 2018 and Say Media, Inc. (“Say Media”) a new wholly-owned subsidiary formed on September 6, 2018 to facilitate the acquisition transactions described in Note 3. Intercompany balances and transactions have been eliminated in consolidation. Foreign Currency The functional currency of the Company’s foreign subsidiaries is the local currencies (U.K. pounds sterling and Canadian dollar), as it is the monetary unit of account of the principal economic environment in which the Company’s foreign subsidiaries operate. All assets and liabilities of the foreign subsidiaries are translated at the current exchange rate as of the end of the period, and revenue and expenses are translated at average exchange rates in effect during the period. The gain or loss resulting from the process of translating foreign currencies financial statements into U.S. dollars was immaterial for the year ended December 31, 2018, therefore, a foreign currency cumulative translation adjustment was not reported as a component of accumulated other comprehensive income (loss) and the unrealized foreign exchange gain or loss was omitted from the consolidated statements of cash flows. Foreign currency transaction gains and losses, if any, resulting from or expected to result from transactions denominated in a currency other than the functional currency are recognized in other income, net on the consolidated statements of operations. Use of Estimates The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include those related to the selection of useful lives of property and equipment, intangible assets, capitalization of platform development and associated useful lives; assumptions used in accruals for potential liabilities; fair value of assets acquired and liabilities assumed in the business acquisitions, the fair value of the Company’s goodwill and the assessment of acquired goodwill, other intangible assets and long-lived assets for impairment; determination of the fair value of stock based compensation and valuation of derivatives liabilities; and the assumptions used to calculate contingent liabilities, and realization of deferred tax assets. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, and makes adjustments when facts and circumstances dictate. Actual results could differ from these estimates. Risks and Uncertainties The Company has a limited operating history and has not generated significant revenues to date. The Company’s business and operations are sensitive to general business and economic conditions in the U.S. and worldwide. These conditions include short-term and long-term interest rates, inflation, fluctuations in debt and equity capital markets and the general condition of the U.S. and world economy. A host of factors beyond the Company’s control could cause fluctuations in these conditions. Adverse developments in these general business and economic conditions could have a material adverse effect on the Company’s financial condition and the results of its operations. In addition, the Company will compete with many companies that currently have extensive and well-funded projects, marketing and sales operations as well as extensive human capital. The Company may be unable to compete successfully against these companies. The Company’s industry is characterized by rapid changes in technology and market demands. As a result, the Company’s products, services, and/or expertise may become obsolete and/or unmarketable. The Company’s future success will depend on its ability to adapt to technological advances, anticipate customer and market demands, and enhance its current technology under development. With the initial onset of COVID-19, the Company faced significant change in its advertisers buying behavior, where previous ad placements were canceled. The Company’s advertising revenue from Sports Illustrated was impacted as a result of sports authorities around the world making the decision to postpone/cancel high attendance sports events in an effort to reduce the spread of the COVID-19 virus. Since May 2020, there has been a steady recovery in the advertising market in both pricing and volume, which coupled with the return of professional and college sports yielded steady growth in revenues through the balance of 2020. The Company expects a continued modest growth in advertising revenue back toward pre-pandemic levels. As a result of the Company’s advertising revenue declining in early 2020, the Company is vulnerable to a risk of loss in the near term and it is at least reasonably possible that events or circumstances may occur that could cause a significant impact in the near term, that depend on future developments, including the duration of COVID-19, future sport event advisories and restrictions, and the extent and effectiveness of containment actions taken. Since August 2018, B. Riley FBR, Inc. (“B. Riley FBR”), a registered broker-dealer owned by B. Riley Financial, Inc., a diversified publicly-traded financial services company (“B. Riley”), has been instrumental in providing investment banking services to the Company and in raising debt and equity capital for the Company. These services have included raising debt and equity capital to support: (i) the acquisitions of HubPages and Say Media (as described in Note 3); (ii) working capital financings with the sale of the 10% Convertible Debentures, 10% OID Convertible Debentures, and 12% Convertible Debentures (as described in Note 13); (iii) the Series H Preferred Stock financing (as described in Note 16); (iv) the sale of the 12% Senior Secured Notes and 12% Amended Senior Secured Notes (as described in Note 24); (v) subsequent acquisition of TheStreet, Inc. and licensing agreement with ABG-SI LLC (as described in Note 24); and (vi) subsequent equity capital for the sale of the Series H Preferred Stock, and sale of the Series I, J and K Preferred Stock (as described in Note 24). Revenue Recognition The Company adopted Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers Revenue Recognition Revenues are recognized when control of the promised goods or services are transferred to the Company’s customers, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services. The Company generates all of its revenue from contracts with customers. The Company accounts for revenue on a gross basis, as compared to a net basis, in its statement of operations. Cost of revenues is presented as a separate line item in the statement of operations. The Company has made this determination based on it taking the credit risk in its revenue-generating transactions and it also being the primary obligor responsible for providing the services to the customer. The following is a description of the principal activities from which the Company generates revenue: Advertising Membership Subscriptions Disaggregation of Revenue The following table provides information about disaggregated revenue by product line, geographical market and timing of revenue recognition: Years Ended December 31, 2018 2017 Revenue by product line: Advertising $ 5,614,953 $ 62,777 Membership subscriptions 85,246 14,218 Total $ 5,700,199 $ 76,995 Revenue by geographical market: United States $ 5,700,199 $ 76,995 Other - - Total $ 5,700,199 $ 76,995 Revenue by timing of recognition: At point in time $ 5,614,953 $ 62,777 Over time 85,246 14,218 Total $ 5,700,199 $ 76,995 Cost of Revenue Cost of revenue represents the cost of providing the Company’s digital media network channels and advertising and membership services. The cost of revenue that the Company has incurred in the periods presented primarily include: channel partner guarantees and revenue share payments; amortization of developed technology and platform development; hosting and bandwidth and software license fees; stock based compensation related to Channel Partner Warrants (as described below); programmatic advertising platform costs; payroll and related expenses of related personnel; fees paid for data analytics and to other outside service providers, and stock based compensation of related personnel. Contract Balances The following table provides information about contract balances: As of December 31, 2018 As of December 31, 2017 Advertising Memberships Total Advertising Memberships Total Factor receivables $ 6,130,674 $ - $ 6,130,674 $ 52,348 $ 854 $ 53,202 Short-term contract assets (contract fulfillment costs) - 17,056 17,056 - 14,147 14,147 Short-term contract liabilities 325,863 70,544 396,407 - 31,437 31,437 Long-term contract liabilities 252,500 - 252,500 - - - The Company receives payments from advertising customers based upon contractual payment terms; accounts receivable are recorded when the right to consideration becomes unconditional and are generally collected within 90 days. The Company generally receives payments from membership subscription customers at the time of sign up for each subscription; accounts receivable from merchant credit card processors are recorded when the right to consideration becomes unconditional and are generally collected weekly. Contract assets include contract fulfillment costs related to the revenue share to the Channel Partners, which are amortized to expense over the same period of the associated revenue. Contract liabilities include payments received in advance of performance under the contract and are recognized as revenue over time. The Company had no asset impairment charges related to contract assets during the years ended December 31, 2018 and 2017. Cash, Cash Equivalents, and Restricted Cash Cash, Cash Equivalents, and Restricted Cash As of December 31, 2018 2017 Cash and cash equivalents $ 2,406,596 $ 619,249 Restricted cash 120,693 3,000,000 Total cash, cash equivalents, and restricted cash $ 2,527,289 $ 3,619,249 In January 2018, the Company raised pursuant to a private placement $3,000,000. The $3,000,000 was received by the Company prior to December 31, 2017 and was classified as restricted cash in the December 31, 2017 balance sheet and then subsequently reclassified to cash in January 2018 upon completion of the private placement. In addition, the $3,000,000 investment was classified as investor demand payable in the December 31, 2017 balance sheet and then subsequently reclassified to equity in January 2018 upon completion of the private placement. Concentrations Significant Customers Revenue from significant customers as a percentage of the Company’s total revenue are as follows: Years Ended December 31, 2018 2017 Customer 1 35.5 % - Customer 2 14.8 % - Significant accounts receivable balances as a percentage of the Company’s total accounts receivable are as follows: As of December 31, 2018 2017 Customer 1 16.8 % - Customer 2 - - Significant Vendors Significant accounts payable balances as a percentage of the Company’s total accounts payable are as follows: As of December 31, 2018 2017 Vendor 1 29.4 % - Vendor 2 11.5 % - Property and Equipment Property and equipment is stated at cost less accumulated depreciation and amortization. Major improvements are capitalized, while maintenance and repairs are charged to expense as incurred. Gains and losses from disposition of property and equipment are included in the statement of operations when realized. Depreciation and amortization are provided using the straight-line method over the following estimated useful lives: Office equipment and computers 3 years Furniture and fixtures 3 – 5 years Platform Development In accordance with authoritative guidance, the Company capitalizes platform development costs for internal use when planning and design efforts are successfully completed, and development is ready to commence. The Company places capitalized platform development assets into service and commences amortization when the applicable project or asset is substantially complete and ready for its intended use. Once placed into service, the Company capitalizes qualifying costs of specified upgrades or enhancements to capitalized platform development assets when the upgrade or enhancement will result in new or additional functionality. The Company capitalizes internal labor costs, including payroll-based and stock based compensation, benefits and payroll taxes, that are incurred for certain capitalized platform development projects related to the Company’s technology platform. The Company’s policy with respect to capitalized internal labor stipulates that labor costs for employees working on eligible internal use capital projects are capitalized as part of the historical cost of the project when the impact, as compared to expensing such labor costs, is material. Platform development costs are amortized on a straight-line basis over three years, which is the estimated useful life of the related asset and is recorded in cost of revenues on the consolidated statements of operations. Business Combinations The Company accounts for business combinations using the acquisition method of accounting. The acquisition method of accounting requires that the purchase price, including the fair value of contingent consideration, of the acquisition be allocated to the assets acquired and liabilities assumed using the estimated fair values determined by management as of the acquisition date. Goodwill is measured as the excess of consideration transferred and the net fair values of the assets acquired and the liabilities assumed at the date of acquisition. While the Company uses its best estimates and assumptions as part of the purchase price allocation process to accurately value assets acquired and liabilities assumed at the acquisition date, the Company’s estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, the Company records adjustments to the assets acquired and liabilities assumed, with the corresponding offset to goodwill to the extent the Company identifies adjustments to the preliminary purchase price allocation. Upon the conclusion of the measurement period, which may be up to one year from the acquisition date, or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to the consolidated statements of operations. Additionally, the Company identifies acquisition-related contingent payments and determines their respective fair values as of the acquisition date, which are recorded as accrued liabilities on the consolidated balance sheets. Subsequent changes in fair value of contingent payments are recorded on the consolidated statements of operations. The Company expenses transaction costs related to the acquisition as incurred. Intangible Assets Intangibles with finite lives, consisting of developed technology and trade names, are amortized using the straight-line method over the estimated economic lives of the assets, which is five years. A finite lived intangible asset is tested for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. Determination of recoverability is based on an estimate of undiscounted future cash flows resulting from the use of the asset and its eventual disposition. Trade name consists of trade names in affiliation with HubPages and Say Media. Intangibles with an indefinite useful life are not being amortized. Long-Lived Assets The Company periodically evaluates the carrying value of long-lived assets to be held and used when events or circumstances warrant such a review. The carrying value of a long-lived asset to be held and used is considered impaired when the anticipated separately identifiable undiscounted cash flows from such an asset are less than the carrying value of the asset. In that event, a loss is recognized based on the amount by which the carrying value exceeds the fair value of the long-lived asset. Fair value is determined primarily by reference to the anticipated cash flows discounted at a rate commensurate with the risk involved. No impairment charges have been recorded in the periods presented. Goodwill Goodwill represents the excess of the purchase price over the fair value of the net tangible and intangible assets of businesses acquired in a business combination. Goodwill is not amortized but rather is tested for impairment at least annually on December 31, or more frequently if events or changes in circumstances indicate that the carrying amount of goodwill may not be recoverable. The Company has elected to first assess the qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis of determining whether it is necessary to perform the quantitative goodwill impairment test. If the Company determines that it is more likely than not that its fair value is less than its carrying amount, then the quantitative goodwill impairment test will be performed. The quantitative goodwill impairment test identifies goodwill impairment and measures the amount of goodwill impairment loss to be recognized by comparing the fair value of a reporting unit with its carrying amount. If the fair value exceeds the carrying amount, no further analysis is required; otherwise, any excess of the goodwill carrying amount over the implied fair value is recognized as an impairment loss, and the carrying value of goodwill is written down to fair value. Deferred Financing Costs and Discounts on Debt Obligations Deferred financing costs consist of cash and noncash consideration paid to lenders and third parties with respect to convertible debt financing transactions, including legal fees and placement agent fees. Such costs are deferred and amortized over the term of the related debt. Upon the settlement or conversion of convertible debt into common stock, the pro rata portion of any related unamortized deferred financing costs are charged to operations. Additional consideration in the form of warrants and other derivative financial instruments issued to lenders is accounted for at fair value utilizing information determined by consultants with the Company’s independent valuation firm. The fair value of warrants and derivatives is recorded as a reduction to the carrying amount of the related debt and is being amortized to interest expense over the term of such debt, with the initial offsetting entries recorded as a liability on the balance sheet. Upon the settlement or conversion of convertible debt into common stock, the pro rata portion of any related unamortized discount on debt is charged to operations. Amortization of debt discount during the years ended December 31, 2018 and 2017, was $601,840 and none, respectively. Liquidated Damages Obligations with respect to Registration Rights Damages (as described below) and Public Information Failure Damages (as described below) (collectively the “Liquidated Damages” or in the context of subsequent events in Note 24 the “Liquidating Damages”) accounted for as contingent obligations when it is deemed probable the obligations would not be satisfied at the time a financing is completed, and are subsequently reviewed at each quarter-end reporting date thereafter. When such quarterly review indicates that it is probable that the Liquidated Damages will be incurred, the Company records an estimate of each such obligation at the balance sheet date based on the amount due of such obligation. The Company reviews and revises such estimates at each quarter-end date based on updated information. Research and Development Research and development costs are charged to operations in the period incurred. Research and development costs consist primarily of expenses incurred in the research and development of the Company’s technology platform in the preliminary project and post-implementation stages which include payroll and related expenses for personnel; costs incurred in developing conceptual formulation and determination of existence of needed technology; and stock based compensation of related personnel. General and Administrative General and administrative expenses consist primarily of payroll and related expenses for executive, sales, and administrative personnel; professional services, including accounting, legal and insurance; depreciation of office equipment, computers, and furniture and fixtures; facilities costs; conferences; other general corporate expenses; and stock based compensation of related personnel. Cost associated with the Company’s advertising are expensed as incurred and included within general and administrative expenses. During the years ended December 31, 2018 and 2017, the Company incurred advertising costs of $25,285 and $1,743, respectively, which comprised print, and digital advertising. Derivative Financial Instruments The Company accounts for freestanding contracts that are settled in a company’s own stock, including common stock warrants, to be designated as an equity instrument, generally as a liability. A contract so designated is carried at fair value on a company’s balance sheet, with any changes in fair value recorded as a gain or loss in a company’s results of operations. The Company records all derivatives on the balance sheet at fair value, adjusted at the end of each reporting period to reflect any material changes in fair value, with any such changes classified as changes in derivatives valuation in the statement of operations. The calculation of the fair value of derivatives utilizes highly subjective and theoretical assumptions that can materially affect fair values from period to period. The recognition of these derivative amounts does not have any impact on cash flows. At the date of exercise of any of the warrants, or the conversion of any convertible debt or preferred stock into common stock, the fair value of the related warrant liability and any embedded derivative liability is transferred to additional paid-in capital. Fair Value of Financial Instruments The authoritative guidance with respect to fair value established a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels and requires that assets and liabilities carried at fair value be classified and disclosed in one of three categories, as presented below. Disclosure as to transfers in and out of Levels 1 and 2, and activity in Level 3 fair value measurements, is also required. Level 1. Observable inputs such as quoted prices in active markets for an identical asset or liability that the Company has the ability to access as of the measurement date. Financial assets and liabilities utilizing Level 1 inputs include active-exchange traded securities and exchange-based derivatives. Level 2. Inputs, other than quoted prices included within Level 1, which are directly observable for the asset or liability or indirectly observable through corroboration with observable market data. Financial assets and liabilities utilizing Level 2 inputs include fixed income securities, non-exchange-based derivatives, mutual funds, and fair-value hedges. Level 3. Unobservable inputs in which there is little or no market data for the asset or liability which requires the reporting entity to develop its own assumptions. Financial assets and liabilities utilizing Level 3 inputs include infrequently traded non-exchange-based derivatives and commingled investment funds and are measured using present value pricing models. The Company determines the level in the fair value hierarchy within which each fair value measurement falls in its entirety, based on the lowest level input that is significant to the fair value measurement in its entirety. In determining the appropriate levels, the Company performs an analysis of the assets and liabilities at each reporting period end. The carrying amount of the Company’s financial instruments comprising of cash, restricted cash, accounts receivable, accounts payable and accrued expenses approximate fair value because of the short-term maturity of these instruments. Preferred Stock Preferred stock (the “Preferred Stock”) (as described in Note 16) is reported as a mezzanine obligation between liabilities and stockholders’ equity. If it becomes probable that the Preferred Stock will become redeemable, the Company will re-measure the Preferred Stock by adjusting the carrying value to the redemption value of the Preferred Stock assuming each balance sheet date is a redemption date. Stock Based Compensation The Company provides stock based compensation in the form of (a) restricted stock awards to employees and directors, (b) stock option grants to employees, directors and consultants, and (c) common stock warrants to Channel Partners (refer to Channel Partner Warrants below). The Company accounts for restricted stock awards and stock option grants to employees, directors and consultants by measuring the cost of services received in exchange for the stock based payments as compensation expense in the Company’s consolidated financial statements. Restricted stock awards and stock option grants to employees which are time-vested are measured at fair value on the grant date and charged to operations ratably over the vesting period. Restricted stock awards and stock option grants to employees which are performance-vested are measured at fair value on the grant date and charged to operations when the performance condition is satisfied. The Company accounts for stock based payments to certain directors and consultants and its Channel Partners by determining the value of the stock compensation based upon the measurement date at either (a) the date at which a performance commitment is reached or (b) at the date at which the necessary performance to earn the equity instruments is complete. The fair value of restricted stock awards which are time-vested is determined using the quoted market price of the Company’s common stock at the grant date. The fair value of restricted stock awards which provide for performance-vesting and a true-up provision (as described in Note 17) is determined through consultants with the Company’s independent valuation firm using the binomial pricing model at the grant date. The fair value of stock options granted and Channel Partner warrants granted as stock based payments are determined utilizing the Black-Scholes option-pricing model which is affected by several variables, the most significant of which are the life of the equity award, the exercise price of the stock option or warrants, as compared to the fair market value of the common stock on the grant date, and the estimated volatility of the common stock over the term of the equity award. Estimated volatility is based on the historical volatility of the Company’s common stock and is evaluated based upon market comparisons. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. The fair market value of common stock is determined by reference to the quoted market price of the Company’s common stock. The Company classifies stock based compensation expense in its consolidated statements of operations in the same manner in which the award recipient’s cash compensation costs are classified. Channel Partner Warrants On December 19, 2016, the Company’s Board approved up to 5,000,000 stock warrants to issue shares of the Company’s common stock to provide equity incentive to its Channel Partners (the “Channel Partner Warrants”) to motivate and reward them for their services to the Company and to align the interests of the Channel Partners with those of stockholders of the Company. On August 23, 2018, the Board approved a reduction of the number of warrant reserve shares from 5,000,000 to 2,000,000. The issuance of the Channel Partner Warrants is administered by management and approved by the Board. The Channel Partner Warrants granted are subject to a performance condition which is generally based on the average number of unique visitors on the channel operated by the Channel Partner generated during the six-month period from the launch of the Channel Partner’s operations on Maven’s platform or the revenue generated during the period from issuance date through a specified end date. The Company recognizes expense for these equity-based payments as the services are received. The Company has specific objective criteria for determination of the period over which services are received and expense is recognized. Income Taxes The Company accounts for income taxes under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to operating loss carryforwards and temporary differences between financial statement bases of existing assets and liabilities and their respective income tax bases. Deferred tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect of a change in the income tax rates on deferred tax asset and liability balances is recognized in income in the period that includes the enactment date of such rate change. A valuation allowance is recorded for loss carryforwards and other deferred tax assets when it is determined that it is more likely than not that such loss carryforwards and deferred tax assets will not be realized. The Company follows accounting guidance that sets forth a threshold for financial statement recognition, measurement, and disclosure of a tax position taken or expected to be taken on a tax return. Such guidance requires the Company to determine whether a tax position of the Company is more likely than not to be sustained upon examination by the applicable taxing authority, including resolution of any related appeals or litigation processes, based on technical merits of the position. Income (Loss) per Common Share Basic income or loss per share is computed using the weighted average number of common shares outstanding during the period and excludes any dilutive effects of common stock equivalent shares, such as stock options, restricted stock, and warrants. All restricted stock is considered outstanding but is included in the computation of basic income (loss) per common share only when the underlying restrictions expire, the shares are no longer forfeitable, and are thus vested. Contingently issuable shares are included in basic income (loss) per common share only when there are no circumstance under which those shares would not be issued. Diluted income per common share is computed using the weighted average number of common shares outstanding and common stock equivalent shares outstanding during the period using the treasury stock method. Common stock equivalent shares are excluded from the computation if their effect is anti-dilutive. The Company excluded the outstanding securities summarized below (capitalized terms are described herein), which entitle the holders thereof to acquire shares of common stock, from its calculation of net income (loss) per common share, as their effect would have been anti-dilutive. As of December 31, 2018 2017 Series G Preferred Stock 188,791 98,698 Series H Preferred Stock 58,787,879 - Indemnity shares of common stock 825,000 - Unvested and forfeitable restricted stock awards 6,309,876 6,979,596 Financing Warrants 3,949,018 1,289,172 Channel Partner Warrants 1,017,141 1,303,832 Common stock options: 2016 Plan 9,405,541 2,176,637 Outside Options 2,414,000 Total 82,897,246 11,847,935 Adoption of Sequencing Policy Under authoritative guidance, the Company adopted a sequencing policy whereby, in the event that reclassification of contracts from equity to assets or |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2018 | |
Business Combinations [Abstract] | |
Acquisitions | 3. Acquisitions The Company uses the acquisition method of accounting which is based on ASC, Business Combinations (Topic 805) HubPages, Inc. On March 13, 2018, the Company and HubPages, together with HP Acquisition Co, Inc. (“HPAC”), a wholly-owned subsidiary of the Company incorporated in Delaware on March 13, 2018 in order to facilitate the acquisition of HubPages by the Company, entered into an Agreement and Plan of Merger, as amended (the “HubPages Merger Agreement”), pursuant to which HPAC would merge with and into HubPages, with HubPages continuing as the surviving corporation in the merger and as a wholly-owned subsidiary of the Company (the “HubPages Merger”). On June 1, 2018, the parties to the Merger Agreement entered into an amendment (the “Amendment”), pursuant to which the parties agreed, among other things, that on or before June 15, 2018 the Company would (i) pay directly to counsel for HubPages the legal fees and expenses incurred by HubPages in connection with the transactions contemplated by the Merger Agreement as of the date of such payment (the “Counsel Payment”); and (ii) deposit into escrow the sum of (x) $5,000,000 minus (y) the amount of the Counsel Payment. On June 15, 2018, the Company made the requisite payment of $5,000,000 under the HubPages Merger Agreement. On August 23, 2018, the Company acquired all the outstanding shares of HubPages, a Delaware corporation, for total cash consideration of $10,569,904, pursuant to the HubPages Merger. The results of operation of the acquired business and the estimated fair market values of the assets acquired and liabilities assumed have been included in the consolidated financial statements as of the acquisition date. The Company acquired HubPages to enhance the user’s experience by increasing content. HubPages is a digital media company that operates a network of 27 premium content channels that act as an open community for writers, explorers, knowledge seekers and conversation starters to connect in an interactive and informative online space. HubPages operates in the United States. The Company paid cash consideration of $10,000,000 to the stockholders and holders of vested options of HubPages, including a $5,000,000 deposit paid on June 15, 2018, as well as additional cash consideration of $569,904, which consists of legal fees and costs incurred by HubPages, for total cash consideration of $10,569,904. The Company also issued a total of 2,399,997 shares of the Company’s common stock, subject to vesting and a true-up provision (as described in Note 17), to certain key personnel of HubPages who agreed to continue their employment with HubPages subsequent to the closing of the transaction. The shares issued are for post combination services (see Note 17). The Company incurred $218,981 in transaction costs related to the acquisition, which primarily consisted of banking, legal, accounting and valuation-related expenses. The acquisition related expenses were recorded in general and administrative expenses on the consolidated statements of operations. The purchase price allocation resulted in the following amounts being allocated to the assets acquired and liabilities assumed at the closing date of the acquisition based upon their respective fair values as summarized below: Cash $ 1,537,308 Current assets 50,788 Accounts receivable and unbilled receivables 1,033,080 Other assets 25,812 Developed technology 6,740,000 Trade name 268,000 Goodwill 1,857,663 Current liabilities (851,114 ) Deferred tax liability (91,633 ) Net assets acquired $ 10,569,904 The Company funded the closing of the HubPages Merger from the net proceeds from the Series H Preferred Stock financing (as described in Note 16). The fair value of the intangible assets was determined as follows: developed technology was determined under the income approach; and trade name was determined by employing the relief from royalty approach. The useful life for the intangible assets is five years (5.0 years). The excess of purchase price over the fair value amounts assigned to the assets acquired and liabilities assumed represents goodwill from the acquisition. Goodwill is recorded as a non-current asset that is not amortized but is subject to an annual review for impairment. The Company believes the factors that contributed to goodwill include the acquisition of a talented workforce that expands the Company’s expertise and synergies that are specific to the Company’s consolidated business and not available to market participants. No portion of the goodwill will be deductible for tax purposes. Say Media, Inc. On October 12, 2018, the Company, Say Media, a Delaware corporation, SM Acquisition Co., Inc. (“SMAC”), a Delaware corporation, which is a wholly-owned subsidiary of the Company incorporated on September 6, 2018 to facilitate a merger, and Matt Sanchez, solely in his capacity as a representative of the Say Media security holders, entered into an Agreement and Plan of Merger, which were amended October 17, 2018, (the “Say Media Merger Agreements”), pursuant to which SMAC will merge with and into Say Media, with Say Media continuing as the surviving corporation in the merger as a wholly-owned subsidiary of the Company (the “Say Media Merger”). On December 12, 2018, the Company acquired all the outstanding shares of Say Media, for total consideration of $12,257,022, pursuant to the Say Media Merger Agreements. The results of operation of the acquired business and the estimated fair market values of the assets acquired and liabilities assumed have been included in the consolidated financial statements as of the acquisition date. The Company acquired Say Media to enhance the user’s experience by increasing content. Say Media is a digital media company that enables brand advertisers to engage today’s social media consumer through rich advertising experiences across its network of web properties. Its corporate headquarters is located in San Francisco, California. Say Media operates in the United States and has subsidiaries located in the United Kingdom, Canada, and Australia. In connection with the consummation of the Say Media Merger, total cash consideration of $9,537,397 was paid, including the following: (1) $6,703,653 to a creditor of Say Media; (2) $250,000 transaction bonus to a designated employee of Say Media; (3) $2,078,498 advanced prior to the closing for the execution payments in connection with the acquisition (certain promissory notes treated as advance against purchase price, see Note 19); and (4) $505,246 for legal fees ($450,000 was advanced for acquisition related legal fees of Say Media paid on August 27, 2018 (certain amount of the promissory notes treated as advance against purchase price, see Note 19) and additional cash consideration of $55,246 was paid at the closing for acquisition related legal fees incurred). Pursuant to the Say Media Merger Agreements, the Company issued a total of 432,835 shares of its common stock as of December 31, 2018 (total common shares to be issued of 5,500,002 at the common stock trading price at the acquisition date of $0.35, refer to Note 17 for additional information) to the former holders of Say Media’s preferred stock. The Company also issued a total of 2,000,000 restricted stock awards, subsequent to the acquisition, to acquire shares of the Company’s common stock to key personnel for continuing services with Say Media, subject to vesting, and repurchase rights under certain circumstances (see Note 17). The shares issued are for post combination services. The composition of the purchase price is as follows: Cash $ 9,537,397 Issued shares of common stock 1,636,251 Indemnity shares of common stock 288,750 Net settlement of preexisting relationship 552,314 Noncompete agreement 242,310 Total purchase consideration $ 12,257,022 In connection with the Say Media Merger Agreements, the Company entered into a noncompete agreement with a certain former executive, whereby the Company will be obligated to pay such executive $416,378 at the end on the restrictive non-competition period of 2 years. The Company recorded the fair value of the noncompete agreement of $242,310 at the date of the Say Media Merger classified as other long term liability on the consolidated balance sheets. The noncompete agreement is collateralized by a note receivable from the certain former executive (as further described below). The Company incurred $479,289 in transaction costs related to the acquisition, which primarily consisted of banking, legal, accounting and valuation-related expenses. The acquisition related expenses were recorded in general and administrative expense on the consolidated statements of operations. The Company funded the closing of the Say Media Merger from the net proceeds from the 10% OID Convertible Debenture and 12% Convertible Debenture financings (as described in Note 16). The purchase price allocation resulted in the following amounts being allocated to the assets acquired and liabilities assumed at the closing date of the acquisition based upon their respective fair values as summarized below: Cash $ 534,637 Accounts receivable and unbilled receivables 4,624,455 Prepaid expenses 172,648 Note receivable 41,638 Fixed assets 11,392 Other assets 65,333 Developed technology 8,010,000 Trade name 480,000 Noncompete agreement 480,000 Goodwill 5,466,624 Accounts payable (3,618,112 ) Accrued expenses (1,470,749 ) Contract liabilities (513,336 ) Other liabilities (2,027,508 ) Net assets acquired $ 12,257,022 In connection with the Say Media Merger, the Company acquired a note receivable dated May 29, 2015 of $416,378 from a certain former executive, bearing interest of 1.53% compounded annually and due May 29, 2024, whereby the Company agreed to deem all amounts due under the note following the restrictive non-competition period of 2 years as paid providing the certain former executive does not violate the noncompete agreement. The Company recorded the fair value of the note receivable of $41,638 at the date of the Say Media Merger within other long term assets on the consolidated balance sheets. The fair value of the intangible assets was determined as follows: developed technology was determined under the income approach; tradename was determined by employing the relief from royalty approach; and noncompete was determined under the with and without approach. The weighted-average useful life for the intangible assets is four and three quarter years (4.75 years). The excess of purchase price over the fair value amounts assigned to the assets acquired and liabilities assumed represents goodwill from the acquisition. Goodwill is recorded as a non-current asset that is not amortized but is subject to an annual review for impairment. The Company believes the factors that contributed to goodwill include the acquisition of a talented workforce that expands the Company’s expertise and synergies that are specific to the Company’s consolidated business and not available to market participants. No portion of the goodwill will be deductible for tax purposes. Supplemental Pro forma Information The following table summarizes the results of operations of the above mentioned transactions from their respective dates of acquisition included in the consolidated results of operations and the unaudited pro forma results of operations of the combined entity had the date of the acquisitions been January 1, 2017: Revenue Net Income (Loss) Acquired entities only from acquisition date until December 31, 2018: HubPages $ 2,996,700 $ 471,640 Say Media 1,398,690 75,661 Total acquired entities only from acquisition date until December 31, 2018 $ 4,395,390 $ 547,301 Combined entity supplemental pro forma from January 1, 2018 to December 31, 2018 (unaudited): HubPages $ 7,537,166 $ 951,836 Say Media 15,210,464 3,365,989 Maven 1,304,809 (26,615,184 ) Adjustments (1,376,478 ) (5,774,681 ) Total supplemental pro forma from January 1, 2018 to December 31, 2018 $ 22,675,961 $ (28,072,040 ) Combined entity supplemental pro forma from January 1, 2017 to December 31, 2017 (unaudited): HubPages $ 4,904,759 $ 575,963 Say Media 12,608,398 20,829,482 Maven 76,995 (6,284,313 ) Adjustments - (8,344,013 ) Total supplemental pro forma from January 1, 2017 to December 31, 2017 $ 17,590,152 $ 6,777,119 The following summarizes earnings per common share of the combined entity had the date of the acquisitions been January 1, 2017: Supplemental Pro Forma from January 1, 2018 to December 31, 2018 (unaudited) Supplemental Pro Forma from January 1, 2017 to December 31, 2017 (unaudited) Net income (loss) $ (28,072,040 ) $ 6,777,119 Net income (loss) per common share – basic and diluted $ (0.81 ) $ 0.33 Weighted average number of common shares outstanding – basic and diluted 34,444,608 20,849,067 The information presented above is for illustrative purposes only and is not necessarily indicative of results that would have been achieved if the acquisitions had occurred as of the beginning of the Company’s 2017 reporting period. For the annual period ended December 31, 2018 supplemental pro forma net income (loss) were adjusted for the HubPages Merger to exclude $218,981 of acquisition-related costs and the income tax benefit of $91,633. The supplemental pro forma net income (loss) for the annual periods ended December 31, 2018 and December 31, 2017 were adjusted for the vesting of restricted stocks awards to HubPages employees in connection with the HubPages Merger of $511,108 and $687,528, respectively, and the amortization of the acquired assets of $678,916 and $998,264, respectively. For the annual period ended December 31, 2018 supplemental pro forma net income (loss) were adjusted for the Say Media Merger to exclude $479,289 of acquisition-related costs, $2,371,124 for the net settlement of preexisting relationship and certain execution payments, and $258,485 loss on the change in fair value of embedded derivatives. The supplemental pro forma net income (loss) for the annual periods ended December 31, 2018 and December 31, 2017 were adjusted for the vesting of restricted stocks awards to Say Media employees in connection with the Say Media Merger of $184,763 and $196,140, respectively, and the amortization of the acquired assets of $385,731 and $798,204, respectively, and interest expense of $2,508,161 and $4,965,607, respectively. |
Prepayments and Other Current A
Prepayments and Other Current Assets | 12 Months Ended |
Dec. 31, 2018 | |
Prepayments And Other Current Assets | |
Prepayments and Other Current Assets | 4. Prepayments and Other Current Assets Prepayments and other current assets are summarized as follows: As of December 31, 2018 2017 General prepaid expenses $ 637,281 $ 174,369 Prepaid software license 85,936 - Security deposits 25,812 - Prepaid rent and other 109,294 - $ 858,323 $ 174,369 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | 5. Property and Equipment Property and equipment are summarized as follows: As of December 31, 2018 2017 Office equipment and computers $ 86,040 $ 46,309 Furniture and fixtures 22,419 21,220 108,459 67,529 Less accumulated depreciation and amortization (39,629 ) (12,859 ) Net property and equipment $ 68,830 $ 54,670 Depreciation expense for the years ended December 31, 2018 and 2017 was $28,857 and $12,469, respectively. Depreciation expense is included in research and development expenses and general and administrative expenses, as appropriate, on the consolidated statements of operations. |
Platform Development
Platform Development | 12 Months Ended |
Dec. 31, 2018 | |
Platform Development | |
Platform Development | 6. Platform Development Platform development costs are summarized as follows: As of December 31, 2018 2017 Platform development $ 6,833,900 $ 3,145,308 Less accumulated amortization (2,125,944 ) (512,251 ) Net platform development $ 4,707,956 $ 2,633,057 A summary of platform development activity for the year ended December 31, 2018 is as follows: Platform development at January 1, 2018 $ 3,145,308 Costs capitalized during the period: Payroll-based costs 2,156,015 Stock based compensation 1,850,384 Dispositions (317,807 ) Platform development at December 31, 2018 $ 6,833,900 During the year ended December 31, 2017, the Company capitalized $2,594,691 of platform development, of which $614,573 represented stock based compensation. Amortization expense for the platform development for the years ended December 31, 2018 and 2017, was $1,836,625 and $512,252, respectively. Amortization expense for platform development is included in cost of revenues on the consolidated statements of operations. |
Intangible Assets
Intangible Assets | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | 7. Intangible Assets Intangible assets subject to amortization consisted of the following: As of December 31, 2018 Carrying Amount Accumulated Amortization Net Carrying Amount Developed technology $ 14,750,000 $ (558,423 ) $ 14,191,577 Noncompete agreement 480,000 (12,000 ) 468,000 Trade name 748,000 (23,819 ) 724,181 Subtotal amortizable intangible assets 15,978,000 (594,242 ) 15,383,758 Website domain name 20,000 - 20,000 Total intangible assets $ 15,998,000 $ (594,242 ) $ 15,403,758 As of December 31, 2017, the Company had an intangible asset of $20,000 which consisted of the website domain name. Intangible assets subject to amortization were recorded as part of the Company’s business acquisition of HubPages and Say Media for the developed technology, noncompete agreement, and trade name. The website domain name has an infinite life and is not being amortized. Amortization expense for the year ended December 31, 2018 was $594,242. No impairment charges have been recorded during the year ended December 31, 2018. As of December 31, 2018, estimated total amortization expense for the next five years related to the Company’s intangible assets subject to amortization is as follows: December 31, 2019 $ 3,339,600 2020 3,327,600 2021 3,099,600 2022 3,099,600 2023 2,517,358 $ 15,383,758 |
Goodwill
Goodwill | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | 8. Goodwill The changes in the carrying value of goodwill for the year ended December 31, 2018 is as follows: Goodwill at January 1, 2018 $ - Goodwill acquired in acquisition of HubPages 1,857,663 Goodwill acquired in acquisition of Say Media 5,466,624 Goodwill at December 31, 2018 $ 7,324,287 The Company performs its annual impairment test at the reporting unit level, which is the operating segment or one level below the operating segment. Management determined that the Company would be aggregated into a single reporting unit for purposes of performing the impairment test for goodwill. For the year ended December 31, 2018, there is no change in goodwill and no impairment. The impairment evaluation process includes, amongst other things, making assumptions about variables, such as revenue growth, including long-term growth rates, profitability and discount rates. |
Accrued Expenses
Accrued Expenses | 12 Months Ended |
Dec. 31, 2018 | |
Payables and Accruals [Abstract] | |
Accrued Expenses | 9. Accrued Expenses Accrued expenses are summarized as follows: As of December 31, 2018 2017 General accrued expenses $ 451,530 $ 150,136 Accrued payroll and related taxes 584,550 - Accrued publisher expenses 644,299 - Customer rebate 489,466 - Other accrued expenses 212,202 - Total accrued expenses $ 2,382,047 $ 150,136 |
Line of Credit
Line of Credit | 12 Months Ended |
Dec. 31, 2018 | |
Line of Credit Facility [Abstract] | |
Line of Credit | 10. Line of Credit During November 2018, the Company entered a factoring note agreement with a finance company to increase working capital through accounts receivable factoring for twelve months, with renewal options for an additional twelve months, with a $3,500,000 maximum facility limit. As of December 31, 2018, $1,048,194 was outstanding under the note. The facility provides for maximum borrowing up to 85% of the eligible accounts receivable (the “Advance Rate”) and the Company may adjust the amount advances up or down at any time. The note is subject to a minimum monthly sales shortfall fee in the event the monthly sales volume is below $1,000,000. The note bears interest at the prime rate plus 4.00% (the “Interest Rate”) (9.50% as of December 31, 2018) and provides for a floor rate of 5.00% with a default rate of 3.00% plus the Interest Rate. In addition, the note provides for an initial factoring fee of 0.415% with an annual per day fee of $950. The factoring note was repaid and terminated subsequent to December 31, 2018 (see Note 24). |
Liquidated Damages Payable
Liquidated Damages Payable | 12 Months Ended |
Dec. 31, 2018 | |
Liquidated Damages Payable | |
Liquidated Damages Payable | 11. Liquidated Damages Payable As of December 31, 2018, the Company recorded $3,647,598 as Liquidated Damages on its consolidated balance sheets. The components of the Liquidated Damages consist of the following: Registration Rights Damages Public Information Failure Damages Information with respect to the Liquidated Damages recognized in the consolidated statements of operations is provided in Note 20, and for amounts contingently liable in Note 23, with any subsequent event information in Note 24. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 12. Fair Value Measurements The Company’s financial instruments consist of Level 1 and Level 3 assets as of December 31, 2018. As of December 31, 2018, the Company’s cash and cash equivalents of $2,406,596, were Level 1 assets and included savings deposits, overnight investments, and other liquid funds with financial institutions. The Company accounts for certain warrants and the embedded conversion features of the 8% Promissory Notes and 10% Convertible Debentures (both as described in Note 13) as derivative liabilities, which requires that the Company carry such amount in its consolidated balance sheets as a liability at fair value, as adjusted at each reporting period-end. The Company determined, due to their greater complexity, prior to the reset provision (as described in Note 13), the fair value of the L2 Warrants (as described in Note 17) and the embedded conversion feature with respect to the 8% Promissory Notes, as of the date of repayment, and 10% Convertible Debentures, as of the date of conversion, using appropriate valuation models derived through consultations with the Company’s independent valuation firm. The Company determined the fair value of the Strome Warrants (as described in Note 17) utilizing the Black-Scholes valuation model as further described below. After the reset provision, the Company determined the fair value of the L2 Warrants utilizing the Black-Scholes valuation model as further described below since such valuation model meets the fair value measurement objective based on the substantive characteristics of the instrument. These warrants and the embedded conversion features are classified as Level 3 within the fair-value hierarchy. Inputs to the valuation model include the Company’s publicly quoted stock price, the stock volatility, the risk-free interest rate, the remaining life of the warrants, notes and debentures, the exercise price or conversion price, and the dividend rate. The Company uses the closing stock price of its common stock over an appropriate period of time to compute stock volatility. These inputs are summarized as follows: L2 Warrants Strome Warrants B. Riley Warrants The following table represents the carrying amount, valuation and roll-forward of activity for the Company’s warrants accounted for as a derivative liability and classified within Level 3 of the fair-value hierarchy for the year ended December 31, 2018: L2 Warrants Strome Warrants B. Riley Warrants Total Warrant Derivative Liabilities Carrying amount at January 1, 2018 $ - $ - $ - $ - Issuance of warrants on June 11, 2018 312,837 - - 312,837 Issuance of warrants on June 15, 2018 288,149 1,344,648 - 1,632,797 Issuance of warrants on October 18, 2018 - - 382,725 382,725 Change in valuation of warrant derivative liabilities (182,772 ) (756,677 ) (24,675 ) (964,124 ) Carrying amount at December 31, 2018 $ 418,214 $ 587,971 $ 358,050 $ 1,364,235 For the year ended December 31, 2018, the change in valuation of warrant derivative liabilities as described in the above table of $964,124 was recognized within other income on the consolidated statements of operations. The L2 Warrants were fully exercised on a cashless basis subsequent to December 31, 2018 (see Note 24). The Company did not have any warrant derivative liabilities as of December 31, 2017. The following table represents the carrying amount, valuation and a roll-forward of activity for the conversion option features, buy-in features, and default remedy features, as deemed appropriate for each instrument (collectively the embedded derivative liabilities), with respect to the 8% Promissory Notes, 10% Convertible Debentures, 10% OID Convertible Debentures, 12% Convertible Debentures (refer to Note 15 for each instrument), and Series G Preferred Stock (as described in Note 16) accounted for as embedded derivative liabilities and classified within Level 3 of the fair-value hierarchy for the year ended December 31, 2018: 8% Promissory Notes 10% Convertible Debentures 10% OID Convertible Debentures 12% Convertible Debentures Series G Preferred Stock Total Embedded Derivative Liabilities Carrying amount at December 31, 2017 $ - $ - $ - $ - $ 72,563 $ 72,563 Recognition of embedded derivative liabilities (conversion option feature) on June 11, 2018 78,432 - - - - 78,432 Recognition of embedded derivative liabilities (conversion option feature) on June 15, 2018 81,169 471,002 - - - 552,171 Recognition of embedded derivative liabilities (buy-in features and default remedy feature) on October 18, 2018 - - 49,000 - - 49,000 Recognition of embedded derivative liabilities (conversion option feature, buy-in feature, and default remedy feature) on December 12, 2018 - - - 4,760,000 - 4,760,000 Gain on extinguishment of embedded derivative liabilities upon extinguishment of host instrument (29,860 ) (1,042,000 ) (25,000 ) - - (1,096,860 ) Change in valuation of embedded derivative liabilities (129,741 ) 570,998 (24,000 ) 2,627,000 (72,563 ) 2,971,694 Carrying amount at December 31, 2018 $ - $ - $ - $ 7,387,000 $ - $ 7,387,000 For the year ended December 31, 2018, the change in valuation of embedded derivative liabilities as described in the above table of $2,971,694 was recognized as other expense on the consolidated statements of operations. For the year ended December 31, 2017, the change in valuation of embedded derivative liabilities for the embedded conversion feature for the Series G Preferred Stock of $64,614 was recognized as other income on the consolidated statements of operations. In addition, the fair value requirement at each period-end for the Series G Preferred Stock embedded conversion feature was no longer required for the year ended December 31, 2018 since it is not considered a derivative liability, therefore, the carrying amount of $72,563 as of December 31, 2017 was recognized as other income of $72,563 during the year ended December 31, 2018 on the consolidated statements of operations. |
Officer Promissory Notes
Officer Promissory Notes | 12 Months Ended |
Dec. 31, 2018 | |
Officer Promissory Notes | |
Officer Promissory Notes | 13. Officer Promissory Notes In May 2018, the Company’s Chief Executive Officer began advancing funds to the Company in order to meet its minimum operating needs. Such advances were made pursuant to promissory notes that were due on demand, with interest at the minimum applicable federal rate, which was approximately 2.34% at December 31, 2018. As of December 31, 2018, the total principal amount of advances outstanding of $680,399, includes accrued interest of $12,574 (see Note 15). |
Investor Demand Payable
Investor Demand Payable | 12 Months Ended |
Dec. 31, 2018 | |
Investor Demand Payable | |
Investor Demand Payable | 14. Investor Demand Payable As of December 31, 2017, the investor demand payable represents funds received on January 4, 2018, pursuant to a private placement of the Company’s common stock sold for total gross proceeds of $3,000,000. The cash was received prior to December 31, 2017 and was classified as restricted cash on the December 31, 2017 balance sheet and then subsequently reclassified to cash in January 2018 upon completion of the private placement (see Note 17). |
Convertible Debt
Convertible Debt | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Convertible Debt | 15. Convertible Debt 8% Promissory Notes On June 6, 2018, the Company entered into a securities purchase agreement with L2 Capital, LLC (“L2”), pursuant to which L2 purchased from the Company a convertible promissory note (the “8% Promissory Notes”), issuable in tranches, in the aggregate principal amount of $1,681,668 for an aggregate purchase price of $1,500,000, with interest at 8% per annum and the maturity date for each tranche funded is seven months from the date of issuance. The 8% Promissory Notes required an increasing premium for any prepayment from 20% for the first 90 days to 38% after 181 days, an increased conversion rate to a 40% discount if in default, a default rate of 18% plus a repayment premium of 40%, plus 5% for each additional default, and liquidated damages in addition to the default rates, ranging from 30% to 100% for certain breaches of the 8% Promissory Notes, subject to mandatory prepayment, including the above described premiums, equal to 50% of new funds raised by the Company in excess of $11,600,000 in the private placement of its securities. On June 11, 2018, a first tranche of $570,556, which included $15,000 of L2’s legal expenses, was purchased for a price of $500,000, reflecting an original issue discount and debt discount of $70,556. On June 15, 2018, a second tranche of $555,556 was purchased for a price of $500,000, an original issue discount of $55,556. In connection with the first and second tranche, the Company issued warrants to L2, exercisable for 216,120 and 210,438 shares of the Company’s common stock at an exercise price of $1.30 and $1.20 per share, respectively (the “L2 Warrants”). L2 had the sole discretion to purchase additional promissory notes, in certain circumstances, which expired. The promissory notes and any accrued but unpaid interest were convertible into common stock, at any time, at a conversion price equal to the lowest volume weighted average price (“VWAP”) during the ten trading day period ending on the issue date of the note. As a result of the closing of the 10% Debenture offering on June 15, 2018 (refer to 10% Convertible Debentures below), L2 no longer has the right to invest in the Company under the securities purchase agreement. The warrants included a reset provision which provided that the number of shares issuable under the warrants shall increase by the quotient of 50% of the face value of the respective tranche and 110% multiplied by the VWAP of the Company’s common stock on the trading day immediately prior to the funding date of the respective tranche (see Note 17). The Company accounted for the warrants and embedded conversion features of the promissory notes as derivative liabilities, as the Company was required to adjust downward (a reset provision) the exercise price of the warrants (floor price of $0.50 per share) and the conversion price of the promissory note under certain circumstances, which required the Company carry such amounts in its consolidated balance sheets as liabilities at fair value, as adjusted at each period-end. Upon issuance, the Company recognized derivative liabilities of $760,587 ($600,986 for the warrants and $159,601 for the embedded conversion feature). The Company also incurred an additional debt issuance cost of $15,000.The embedded derivative liabilities and debt issuance costs were treated as a debt discount and amortized over the term of the debt. During the year ended December 31, 2018, the Company recognized a gain of $29,860 upon extinguishment of debt for the embedded conversion feature derivative liabilities and a change in fair value of $129,741 immediately before the extinguishment (see Note 12). On September 6, 2018, the Company repaid the 8% Promissory Notes. The total amount borrowed was $1,015,000, and under the terms of the loan agreement the Company repaid $1,372,320 to satisfy the debt obligation resulting in a loss on extinguishment of debt which is presented in interest expense on the consolidated statements of operations. Information with respect to debt components and interest expense related to the 8% Promissory Notes Convertible Debt and Debt Components Interest Expense 10% Convertible Debentures On June 15, 2018, the Company entered into a securities purchase agreement with four accredited investors to purchase an aggregate of $4,775,000 in principal amount of the Company’s 10% Convertible Debenture, due on June 30, 2019 (the “10% Convertible Debentures”). Included in the aggregate total of $4,775,000 is $1,025,000 from two of the Company’s executives. The 10% Convertible Debentures were convertible into an aggregate of 3,698,110 shares of the Company’s common stock based on a conversion price of $1.2912 per share. The 10% Convertible Debentures were interest bearing at the rate of 10% per annum, that was payable in cash semi-annually on December 31 and June 30, beginning on December 31, 2018. Upon the occurrence of certain events, the holders of the 10% Convertible Debentures were also entitled to receive an additional payment, if necessary, to provide the holders with a 20% annual internal rate of return on their investment. The Company had the option, under certain circumstances, to redeem some or all of the outstanding principal amount for an amount equal to the principal amount (plus accrued but unpaid interest thereon) or the option to cause the holders to convert their debt at a certain conversion price, otherwise, the Company was not permitted to prepay any portion of the principal amount without the prior written consent of the debt holders. Additionally, pursuant to a registration rights agreement entered into in connection with the purchase agreement, the Company agreed to register the shares issuable upon conversion of the 10% Convertible Debentures for resale by the holders of the 10% Convertible Debentures. The Company had committed to file the registration statement by no later than 45 days after June 15, 2018 and to cause the registration statement to become effective by no later than 120 days after June 15, 2018 (or, in the event of a full review by the staff of the SEC, 150 days following June 15, 2018). The registration rights agreement provided for Liquidated Damages upon the occurrence of certain events up to a maximum amount of 6% of the aggregate amount invested by such holders. Liquidated Damages were waived as part of the roll-over of the 10% Convertible Debentures into Series H Preferred Stock. The securities purchase agreement also included a provision that required the Company to maintain its periodic filings with the SEC in order to satisfy the public information requirements under Rule 144(c) of the Securities Act. If the Company failed for any reason to satisfy the current public information requirement, then the Company would have been obligated to pay to each holder a cash payment equal to 1.0% of the amount invested as partial Liquidated Damages, up to a maximum of six months. Such payments were subject to interest at the rate of 1.0% per month until paid in full. The 10% Convertible Debentures was rolled over into Series H Preferred Stock before the due date for the commencement of the Liquidated Damages. Upon issuance, the Company accounted for an embedded conversion feature of the 10% Convertible Debentures as a derivative liability totaling $471,002, as the Company was required to adjust downward the conversion price of the debt under certain circumstances, which required that the Company carry such amount in its consolidated balance sheet as a liability at fair value, as adjusted at each period-end. The embedded derivative liability was treated as a debt discount and amortized over the term of the debt. During the year ended December 31, 2018, the Company recognized a gain of $1,042,000 upon extinguishment of debt for the embedded conversion feature derivative liabilities and a change in fair value of $570,998 immediately before the extinguishment (see Note 12). On August 10, 2018, the 10% Convertible Debentures with an aggregate principal amount of $4,775,000 plus obligations of $955,000 were converted into 5,730 shares of Series H Preferred Stock resulting in a loss on extinguishment of debt upon conversion which is presented in interest expense on the consolidated statements of operations. Information with respect to debt components and interest expense related to the 10% Convertible Debentures Convertible Debt and Debt Components Interest Expense 10% Original Issue Discount Convertible Debentures On October 18, 2018, the Company entered into a securities purchase agreement with two accredited investors, B. Riley and an affiliated entity of B. Riley, pursuant to which the Company issued to the investors 10% original issue discount senior secured convertible debentures (the “10% OID Convertible Debentures” or referred to as the 10% original issue discount debentures) in the aggregate principal amount of $3,500,000, which, after taking into account the 5% original issue discount, and legal fees and expenses of the investors, resulted in the Company receiving net proceeds of $3,285,000. The Company issued warrants to the investors to purchase up to 875,000 shares of the Company’s common stock in connection with this securities purchase agreement. The debt proceeds were bifurcated between the debt and warrants with the warrants accounted for as a derivative liability (see Note 17). The debentures were due and payable on October 31, 2019. Interest accrued on the debentures at the rate of 10% per annum, payable on the earlier of conversion, redemption, or October 31, 2019. The debentures were convertible into shares of the Company’s common stock at the option of the investor at any time prior to October 31, 2019, at a conversion price of $1.00 per share, subject to adjustment for stock splits, stock dividends and similar transactions, and were subject to certain redemption rights by the Company. Further, the agreement provided a buy-in and default remedy feature (which were similar to the features described below for the 12% Convertible Debentures) which were both bifurcated from the debt instrument as an embedded derivative liability as referenced in the table Convertible Debt and Debt Components Upon issuance, the Company accounted for the embedded buy-in and default remedy features of the 10% OID Convertible Debentures as a derivative liability totaling $49,000. The Company also incurred an additional debt issuance cost of $40,000. The embedded derivative liabilities and debt issuance costs were treated as a debt discount and amortized over the term of the debt. During the year ended December 31, 2018, the Company recognized a gain of $25,000 upon extinguishment of debt for the embedded derivative liabilities and a change in fair value of $24,000 immediately before the extinguishment (see Note 12). On December 12, 2018, there was a roll-over of the 10% OID Convertible Debentures into the 12% Convertible Debentures (as further described below) resulting in a loss on extinguishment of debt upon the roll-over which is presented in interest expense on the consolidated statements of operations. Information with respect to debt components and interest expense related to the 10% Original Issue Discount Convertible Debentures Convertible Debt Debt Components Interest Expense 12% Convertible Debentures On December 12, 2018, the Company entered into a securities purchase agreement with three accredited investors, pursuant to which the Company issued to the investors 12% senior secured subordinated convertible debentures (the “12% Convertible Debentures” or as referred to as the 12% convertible debentures) in the aggregate principal amount of $13,091,528, which includes (i) the roll-over of an aggregate of $3,551,528 in principal and interest of the 10% OID Convertible Debentures issued to two of the investors on October 18, 2018, and (ii) a placement fee, payable in cash, of $540,000 to the Company’s placement agent, B. Riley FBR, in the offering. After taking into account legal fees and expenses of the investors, the Company received net proceeds of $8,950,000. The 12% Convertible Debentures are due and payable on December 31, 2020. Interest accrues at the rate of 12% per annum, payable on the earlier of conversion or December 31, 2020. The Company’s obligations under the 12% Convertible Debentures are secured by a security agreement, dated as of October 18, 2018, by and among the Company and each investor thereto. Subject to the Company receiving shareholder approval to increase its authorized shares of common stock, principal on the 12% Convertible Debentures are convertible into shares of common stock, at the option of the investor at any time prior to December 31, 2020, at a conversion price of $0.33 per share, subject to adjustment for stock splits, stock dividends and similar transactions, and beneficial ownership blocker provisions. If the Company does not perform certain of its obligations in a timely manner, it must pay Liquidated Damages (as further described below) to the investors (see Note 20 and 23). Upon issuance of the 12% Convertible Debentures, the Company recognized the following embedded derivative liabilities that were bifurcated from the note instruments: ● Conversion option – (1) At any time after the original issue date until the note is no longer outstanding, the note shall be convertible, in whole or in part, into shares of common stock at the option of the holder at a conversion price of $0.33 per share (or 39,671,296 shares), and (2) at any time and from time to time subject to: (i) an issuance limitations, which limits the holders conversion of the note into shares of common stock in excess of 566,398, proportional to the holders convertible shares to the total convertible shares under the note, until the Company has an authorized share increase (as further described in Note 2 and 24 under the heading Sequencing Policy ● Buy-in feature – (1) The debt is puttable for a certain buy-in amount where it gives the holder the right, if the Company fails for any reason to deliver to the holder the conversion shares, to a cash settlement for the difference between the cost of the Company’s common stock in the open market and the conversion price; and (2) the put is contingent if the Company fails to deliver conversion shares pursuant to a buy-in event. ● Default remedy feature – (1) The debt is puttable in the event of default where it gives the holder the right to repayment, in cash, the greater of (i) the outstanding principal amount due divided by the then conversion price times the daily volume weighted average price of the common stock; or (ii) the outstanding principal debt amount, plus unpaid but accrued interest and other amounts owing in the notes; and (2) the put is contingent upon a Change of Control (as described below) or Fundamental Transaction (as described below). Change in Control Fundamental Transaction As long as any portion of the 12% Convertible Debentures remain outstanding, unless investors holding at least 51% in principal amount of the then outstanding 12% Convertible Debentures otherwise agree, the Company shall not, among other things enter into, incur, assume or guarantee any indebtedness, except for certain permitted indebtedness. Upon issuance, the Company accounted for the embedded conversion option feature, buy-in feature, and default remedy feature as embedded derivative liabilities totaling $4,760,000, which requires the Company carry such amount in its consolidated balance sheet as a liability at fair value, as adjusted at each period-end. The Company also incurred an additional debt issuance cost of $590,000. The embedded derivative liabilities and debt issuance cost were treated as a debt discount and amortized over the term of the debt. During the year ended December 31, 2018, the Company recognized amortization of debt discount of $135,533 and a change in fair value of the embedded derivative liabilities $2,627,000 (see Note 12). Pursuant to the registration rights agreements entered into in connection with the securities purchase agreements, the Company agreed to register the shares issuable upon conversion of the 12% Convertible Debentures for resale by the investors. The Company committed to file the registration statement the later of (i) the 30th calendar day following the date the Company files its Annual Report on Form 10-K for the fiscal year ended December 31, 2018 with the SEC, but in no event later than May 15, 2019, and (ii) the 30th calendar day after all the common stock issuable on the conversion of the Series H Preferred Stock have been registered pursuant to a registration statement under a certain registration rights agreement, dated as of August 9, 2018. The registration rights agreements provide for Registration Rights Damages (presented within liquidated damages payable on the consolidated balance sheets) upon the occurrence of certain events up to a maximum amount of 6% of the aggregate amount invested. The securities purchase agreements also included a provision that requires the Company to maintain its periodic filings with the SEC in order to satisfy the public information requirements under Rule 144(c) of the Securities Act. If the Company fails for any reason to satisfy the current public information requirement commencing from the six (6) month anniversary date of issuance of the 12% Convertible Debentures, then the Company will be obligated to pay Public Information Failure Damages (presented as liquidated damages payable on the consolidated balance sheets) to each holder, consisting of a cash payment equal to 1% of the amount invested as partial liquidated damages, up to a maximum of six months, subject to interest at the rate of 1% per month until paid in full. The Company recognized a portion of the Public Information Failure Damages pursuant to the securities purchase agreements in connection with the 12% Convertible Debentures at the time of issuance as it was deemed probable the obligations would not be satisfied when the financing was completed (see Note 11 and 20). Information with respect to debt components and interest expense related to the 12% Convertible Debentures Convertible Debt and Debt Components Interest Expense 12% Convertible Debentures Convertible Debt and Debt Components Convertible debt and the related debt components for the year ended December 31, 2018 are summarized as follows: 8% 10% Convertible Debentures 10% OID Convertible Debentures 12% Convertible Debentures Total Convertible Debt and Debt Components Principal amount of debt $ 1,126,112 $ 4,775,000 $ 3,500,000 $ 9,540,000 $ 18,941,112 Less: original issue discount (111,112 ) - (175,000 ) - (286,112 ) Less: issuance costs (15,000 ) - (40,000 ) (590,000 ) (645,000 ) Net cash proceeds received $ 1,000,000 $ 4,775,000 $ 3,285,000 $ 8,950,000 $ 18,010,000 Principal amount of debt (excluding original issue discount) $ 1,015,000 $ 4,775,000 $ 3,325,000 $ 9,540,000 $ 18,655,000 Add: conversion of debt from 10% OID Convertible Debentures - - - 3,551,528 3,551,528 Add: accrued interest 20,986 69,920 28,009 82,913 201,828 Principal amount of debt including accrued interest 1,035,986 4,844,920 3,353,009 13,174,441 22,408,356 Debt discount: Allocated warrant derivative liabilities for B. Riley Warrants - - (382,725 ) - (382,725 ) Allocated warrant derivative liabilities for L2 Warrants (600,986 ) - - - (600,986 ) Allocated embedded derivative liabilities (159,601 ) (471,002 ) (49,000 ) (4,760,000 ) (5,439,603 ) Liquidated Damages recognized upon issuance (706,944 ) (706,944 ) Issuance costs (15,000 ) - (40,000 ) (590,000 ) (645,000 ) Subtotal debt discount (775,587 ) (471,002 ) (471,725 ) (6,056,944 ) (7,775,258 ) Less: amortization of debt discount 315,309 64,452 68,637 153,442 601,840 Less: write off unamortized debt discount upon extinguishment of debt 460,278 406,550 403,088 - 1,269,916 Unamortized debt discount - - - (5,903,502 ) (5,903,502 ) Debt components: Accretion of original issue discount 44,133 - 25,463 - 69,596 Loss on extinguishment of debt 292,201 885,080 173,056 - 1,350,337 Conversion of debt to 12% Convertible Debentures - - (3,551,528 ) - (3,551,528 ) Conversion of debt to Series H Preferred Stock - (5,730,000 ) - - (5,730,000 ) Repayment of convertible debt (1,372,320 ) - - - (1,372,320 ) Total debt components (1,035,986 ) (4,844,920 ) (3,353,009 ) - (9,233,915 ) Carrying amount at December 31, 2018 $ - $ - $ - $ 7,270,939 $ 7,270,939 The Company did not have any convertible debt for the year ended December 31, 2017. Interest Expense Interest expense for the year ended December 31, 2018 is summarized as follows: 8% 10% Convertible Debentures 10% OID Convertible Debentures 12% Convertible Debentures Total Interest Expense Accretion of original issue discount $ 44,133 $ - $ 25,463 $ - $ 69,596 Amortization of debt discount 315,309 64,452 68,637 153,442 601,840 Loss on extinguishment of debt 292,201 885,080 173,056 - 1,350,337 Gain on extinguishment of embedded derivative liabilities upon extinguishment of host instrument (29,860 ) (1,042,000 ) (25,000 ) - (1,096,860 ) Write off unamortized debt discount upon extinguishment of debt 460,278 406,550 403,088 - 1,269,916 Accrued interest - 69,920 28,009 82,913 180,842 Cash interest paid 20,986 - - - 20,986 $ 1,103,047 $ 384,002 $ 673,253 $ 236,355 2,396,657 Accrued interest on Officer Promissory Notes 12,574 Other interest 99,643 Total $ 2,508,874 The Company did not have any interest expense for the year ended December 31, 2017. |
Preferred Stock
Preferred Stock | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Preferred Stock | 16. Preferred Stock The Company has the authority to issue 1,000,000 shares of preferred stock, $0.01 par value per share, consisting of 10,270 authorized shares originally designated as series A through E with designations subsequently eliminated, 2,000 authorized shares designated as “Series F Convertible Preferred Stock,” none of which are outstanding, 1,800 authorized shares designated as “Series G Convertible Preferred Stock” (as further described below), of which 168.496 shares are outstanding as of December 31, 2018, and 23,000 authorized shares designated as “Series H Convertible Preferred Stock” (as further described below), of which 19,400 shares are outstanding as of December 31, 2018. Series G Preferred Stock On May 30, 2000, the Company sold 1,800 shares of its Series G Convertible Preferred Stock (the “Series G Preferred Stock”) and warrants, which expired on November 29, 2003, to purchase 63,000 shares of common stock to four investors. The Series G Preferred Stock has a stated value of $1,000 per share and is convertible into shares of common stock, at the option of the holder, subject to certain limitations. The Series G Preferred Stock was initially convertible into common stock at a conversion price equal to 85% of the lowest sale price of the common stock over the five trading days preceding the date of the conversion, subject to a maximum conversion price of $16.30, adjusted for a 1-for-10 reverse stock split effective July 26, 2007. The Company may require holders to convert all (but not less than all) of the Series G Preferred Stock at any time after November 30, 2003 or buy out all outstanding shares of Series G Preferred Stock at the then conversion price. Holders of Series G Preferred Stock are not entitled to dividends and have no voting rights, unless required by law or with respect to certain matters relating to the Series G Preferred Stock. Prior to November 2001, 1,631.504 of the initial 1,800 shares of Series G Preferred Stock were converted into the Company’s common stock by the holders thereof. No conversions have taken place since November 2001. The remaining 168.496 shares continue to be outstanding. Upon a change in control, sale of or similar transaction, as defined in the Certificate of Designation for the Series G Preferred Stock, the holder of the Series G Preferred Stock has the option to deem such transaction as a liquidation and may redeem their 168.496 shares at the liquidation value of $1,000 per share, or an aggregate amount of $168,496. The sale of all the assets of the Company on June 28, 2007 triggered the redemption option. As such redemption was not in the control of the Company, the Series G Preferred Stock has been accounted for as if it was redeemable preferred stock and is classified on the consolidated balance sheets as a mezzanine obligation between liabilities and stockholders’ equity. Series H Preferred Stock On August 10, 2018, the Company closed on a securities purchase agreement (the “Securities Purchase Agreement”) with certain accredited investors, pursuant to which the Company issued an aggregate of 19,400 shares of Series H Convertible Preferred Stock (the “Series H Preferred Stock”) at a stated value of $1,000, initially convertible into 58,785,606 shares of the Company’s common stock, at the option of the holder subject to certain limitations, at a conversion rate equal to the stated value divided by the conversion price of $0.33 per share (the “Conversion Price”), for aggregate gross proceeds of $19,399,250. Of the shares of Series H Preferred Stock issued, 5,730 shares were issued upon conversion of an aggregate principal amount of $4,775,000, plus prepayment obligations of $955,000 (totaling $5,730,000), of the 10% Convertible Debentures issued by the Company on June 15, 2018 to certain accredited investors, including 1,200 shares of Series H Preferred Stock issued to Heckman Maven Fund L.P. (affiliated with James C. Heckman, the Company’s then Chief Executive Officer), and 30 shares of Series H Preferred Shares issued to Joshua Jacobs, the Company’s then President. B. Riley FBR, Inc. (“B. Riley FBR”) is a registered broker-dealer owned by B. Riley Financial, Inc., a diversified publicly traded financial services company (“B. Riley”), which acted as placement agent for the Series H Preferred Stock financing. In consideration for its services as placement agent, the Company paid B. Riley FBR a cash fee of $575,000 (including a previously paid retainer of $75,000) and issued to B. Riley FBR 669.25 shares (stated value of $1,000 per share) of Series H Preferred Stock. In addition, entities affiliated with B. Riley FBR purchased 5,592 shares of Series H Preferred Stock in the financing (total issuance cost of $1,194,546). The terms of Series H Preferred Stock and the number of shares of common stock issuable is adjustable in the event of stock splits, stock dividends, combinations of shares and similar transactions. Each Series H Preferred Stock shall vote on an as-if-converted to common stock basis, subject to beneficial ownership blocker provisions. In addition, if at any time prior to the nine month anniversary of the closing date, the Company sells or grants any option or right to purchase or issues any shares of common stock, or securities convertible into shares of common stock, with net proceeds in excess of $1,000,000 in the aggregate, entitling any person to acquire shares of common stock at an effective price per share that is lower than the then Conversion Price (such lower price, the “Base Conversion Price”), then the Conversion Price shall be reduced to equal the Base Conversion Price. All the shares of Series H Preferred Stock shall automatically convert into shares of common stock on the fifth anniversary of the closing date at the then Conversion Price. The shares of Series H Preferred Stock are subject to limitations on conversion into shares of the Company’s common stock until the date an amendment to the Company’s certificate of incorporation is filed and accepted with the State of Delaware that increases the number of authorized shares of its common stock to at least a number permitting all the Series H Preferred Stock to be converted in full (further details are provided subsequent to the date of these consolidated financial statements in Note 24 under the heading Sequencing Policy In addition, if at any time the Company grants, issues or sells any common stock equivalents or rights to purchase stock, warrants, securities or other property pro rata to the record holders of any class of shares of common stock (the “Purchase Rights”), then a holder of the Series H Preferred Stock will be entitled to acquire the aggregate Purchase Rights which the holder could have acquired if the holder had held the number of shares of common stock acquirable upon complete conversion of such holder’s Series H Preferred Stock immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, subject to certain conditions, adjustments and limitations. Pursuant to the registration rights agreement entered into on August 10, 2018 in connection with the Securities Purchase Agreement, the Company agreed to register the shares issuable upon conversion of the Series H Preferred Stock for resale by the holders. The Company committed to file the registration statement by no later than 75 days after the closing date and to cause the registration statement to become effective, in general, by no later than 120 days after the closing date (or, in the event of a full review by the staff of the Securities and Exchange Commission (“SEC”), 150 days following the closing date). The registration rights agreement provides for a cash payment equal to 1.0% per month of the amount invested as partial liquidated damages upon the occurrence of certain events, on each monthly anniversary, payable within 7 days of such event, up to a maximum amount of 6.0% of the aggregate amount invested, subject to interest at 12.0% per annum, accruing daily, until paid in full. The Company recognized Liquidated Damages of $1,404,464 during the year ended December 31, 2018, with respect to its registration rights agreement (see Note 11 and 20). The Securities Purchase Agreement included a provision that requires the Company to maintain its periodic filings with the SEC in order to satisfy the Public Information Failure Payments requirements under Rule 144(c) of the Securities Act. If the Company fails for any reason to satisfy the current public information requirement commencing from the six (6) month anniversary date of the closing of the Series H Preferred Stock, then the Company will be obligated to pay to each holder a cash payment equal to 1.0% of the aggregate amount invested for each 30-day period, or pro rata portion thereof, as partial liquidated damages per month, up to a maximum of 6 months, subject to interest at the rate of 1.0% per month until paid in full. The Company recognized $1,404,463 of Liquidated Damages during the year ended December 31, 2018, with respect to its public information requirements (see Note 11 and 20). During the year ended December 31, 2018, in connection with the 19,400 Series H Preferred Stock issuance, the Company recorded a beneficial conversion feature in the amount of $18,045,496 for the underlying common shares since the nondetachable conversion feature was in-the-money (the Conversion Price of $0.33 was lower than the Company’s common stock trading price of $0.86) at the issuance date. The beneficial conversion feature was recognized as a deemed dividend. The following table represents the components of the Series H Preferred Stock, stated value of $1,000 per share, for the year ended December 31, 2018: Shares Total Series H Preferred Stock Components Issuance of Series H Preferred Stock on August 10, 2018 19,400 $ 19,399,250 Less: shares issued to B. Riley FBR as placement fee (670 ) (669,250 ) Less: shares issued for conversion of principal of 10% Convertible Debentures (4,775 ) (4,775,000 ) Less: shares issued to 10% Convertible Debenture holders for additional payment of 20% annual internal rate of return (955 ) (955,000 ) Net issuance of Series H Preferred Stock 13,000 13,000,000 Payments made to B. Riley FBR from proceeds: Less: placement fee (500,000 ) Less: legal fees and other costs (25,296 ) Total payments made from proceeds (525,296 ) Net cash proceeds from issuance of Series H Preferred Stock $ 12,474,704 Issuance of Series H Preferred Stock $ 19,399,250 Less issuance costs: Shares issued to B. Riley FBR as placement fee (669,250 ) Total payments made from proceeds (525,296 ) Legal and other costs paid in cash (159,208 ) Total issuance costs (1,353,754 ) Beneficial conversion feature on Series H Preferred Stock $ 18,045,496 Further information with respect to Series H Preferred Stock is provided in Note 24 Series I Preferred Stock Information with respect to Series I Preferred Stock is provided in Note 24. Series J Preferred Stock Information with respect to Series J Preferred Stock is provided in Note 24. Series K Preferred Stock Information with respect to Series K Preferred Stock is provided in Note 24. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Stockholders' Equity | 17. Stockholders’ Equity Recapitalization On October 11, 2016, Integrated and Amplify executed a share exchange agreement, as amended, that provided for each outstanding common share of Amplify to be converted into 4.13607 common shares of Integrated (the “Exchange Ratio”), and for each outstanding warrant and stock option to purchase shares of Amplify common stock be cancelled in exchange for a warrant or stock option to purchase shares of Integrated common stock based on the Exchange Ratio (the “Recapitalization”). On November 4, 2016, the consummation of the Recapitalization became effective and pursuant to the Recapitalization, Integrated: (1) issued to the shareholders of Amplify an aggregate of 12,517,152 shares of Integrated common stock; and (2) issued to MDB Capital Group, LLC (“MDB”) as an advisory fee, warrants to purchase 1,169,607 shares of Integrated common stock. Existing Integrated stock options to purchase 175,000 shares of Integrated common stock were assumed pursuant to the Recapitalization. Common Stock The Company has the authority to issue 1,000,000,000 shares of common stock, $0.01 par value per share (further details subsequent to the date of these consolidated financial statements are provided in Note 24 under the heading Sequencing Policy On April 4, 2017, the Company completed a private placement of its common stock, selling 3,765,000 shares at $1.00 per share, for total gross proceeds of $3,765,000. In connection with the private placement, the Company paid $188,250 and issued 162,000 shares of common stock to MDB, which acted as placement agent. The transaction costs including and noncash expenses, have been recorded as a reduction in additional paid-in capital. The shares issued through this private placement have registration rights, and a registration statement was filed within approximately forty-five days of the offering completion date. On October 19, 2017, the Company completed a private placement of its common stock, selling 2,391,304 shares at $1.15 per share, for total gross proceeds of $2,734,205. In connection with the private placement, the Company issued 119,565 shares of common stock and 119,565 warrants to purchase shares of the Company’s common stock to MDB, which acted as placement agent, with a fair value of $126,286. The transaction costs, including any noncash expenses, have been recorded as a reduction in additional paid-in capital. The shares issued through this offering have registration rights, and a registration statement was filed within approximately forty-five days of the offering completion date. On January 4, 2018, the Company issued an aggregate of 1,200,000 shares of its common stock to an investor, Strome Mezzanine Fund LP (“Strome”), in a private placement at a price of $2.50 per share. The Company received gross proceeds of $3,000,000 from the private placement, which was received prior to December 31, 2017, and was therefore classified as restricted cash and as a private placement advance on the consolidated balance sheet at December 31, 2017. Upon completion of the private placement on January 4, 2018, the funds were reclassified to cash and stockholders’ equity. In connection with the January 4, 2018 closing of the private placement, MDB, as the placement agent, was entitled to receive 60,000 shares of the Company’s common stock (presented as “Common Stock to be Issued” within stockholders’ equity) valued at $150,000 (value based on private placement price of $2.50 per share). In addition, MDB received warrants to purchase 60,000 shares of the Company’s common stock at an exercise price of $2.50 per share (refer to Common Stock Warrants below). Pursuant to the registration rights agreement entered into on January 4, 2018 with Strome and MDB, the Company agreed to register for resale the shares of common stock purchased pursuant to the private placement. The Company also committed to register the 60,000 shares issued to MDB, and the 60,000 shares underlying the warrants issued to MDB. The Company committed to file the registration statement no later than 200 days after the closing and to cause the registration statement to become effective no later than the earlier of (i) 7 business days after the SEC informs the Company that no review of the registration statement will be made or (ii) when the SEC has no further comments on the registration statement. The registration rights agreement provides for liquidated damages upon the occurrence of certain events, including the Company’s failure to file the registration statement or to cause it to become effective by the deadlines set forth above. The amount of liquidated damages payable to Strom or MDB is 1.0% of the aggregate amount invested for each 30-day period, or pro rata portion thereof, during which the default continues, up to a maximum amount of 5.0% of the aggregate amount invested or the value of the securities registered by the placement agent. The purchaser of the shares of common stock waived the liquidated damages when the purchaser converted certain notes payable into Series H Preferred Stock in August 2018 (see Note 23). The Company recognized Liquidated Damages for the year ended December 31, 2018, with respect to its registration rights agreement for the common stock issued to MDB in conjunction with the January 4, 2018 private placement (see Note 20). On March 30, 2018, the Company issued an aggregate of 500,000 shares of its common stock to Strome in a second closing of the private placement entered into on January 4, 2018 at a price of $2.50 per share. The Company received gross proceeds of $1,250,000 from the second closing of the private placement. No costs were incurred in connection with the second closing of the private placement. The Company entered into a registration rights agreement on March 30, 2018 with the investor, pursuant to which the Company agreed to register for resale the shares of common stock purchased pursuant to the placement. The Company committed to file the registration statement no later than 270 days after the closing and to cause the registration statement to become effective no later than the earlier of (i) 7 business days after the SEC informs the Company that no review of the registration statement will be made or (ii) when the SEC has no further comments on the registration statement. The registration rights agreement provides for liquidated damages upon the occurrence of certain events, including the Company’s failure to file the registration statement or to cause it to become effective by the deadlines set forth above. The amount of liquidated damages payable to the investor is 1.0% of the aggregate amount invested for each 30-day period, or pro rata portion thereof, during which the default continues, up to a maximum amount of 5.0% of the aggregate amount invested. The purchaser of the shares of common stock waived the liquidated damages when the purchaser converted certain notes payable into Series H Preferred Stock in August 2018 (see Note 13). On December 12, 2018, in connection with the Say Media Merger, the Company issued 432,835 shares of its common stock out of total shares required to be issued of 5,500,002 as of December 31, 2018, and has presented 5,067,167 of the shares required to be issued as “Common Stock to be Issued” within stockholders’ equity. Information with respect to the issuance of common stock in connection with the acquisition of Say Media is provided in Note 24. Restricted Stock Awards During August 2016 and October 2016, the Company issued 12,209,677 and 307,475, respectively, shares of common stock to management and employees, as restricted stock awards, that contained a Company buy-back right for a certain number of shares pursuant to the achievement of a unique user performance condition (the “Performance Condition”) issued at the original cash consideration paid, which totaled $2,952 or approximately $0.0002 per share. On November 4, 2016, in conjunction with the Recapitalization, the number of shares subject to the buy-back was modified, resulting in a modification of the restricted stock awards. The shares vest over a three-year period starting on the beginning of the month of the issuance date, with one-third vesting in one year, and the balance monthly over the remaining two years. Because these shares require continued service to the Company, the estimated fair value of the shares is being recognized as compensation expense over the vesting period of the award. As of December 31, 2017, the Performance Condition was determined based on 4,977,144 unique users accessing Maven’s channels in November 2017. Based on this level of unique users, 2,453,362 shares subject to the buy-back right were earned under the Performance Condition and 1,927,641 shares remained subject to the buy-back right. The Company’s Board made a determination on March 12, 2018 to waive the buy-back right, resulting in a modification of the restricted stock awards which resulted in incremental compensation cost of $2,756,527 at the time of the modification, of which $2,148,811 was recognized during the year ended December 31, 2018. On August 23, 2018, in connection with the HubPages Merger, the Company issued a total of 2,399,997 shares of common stock to certain key personnel of HubPages who agreed to continue their employment with HubPages, as restricted stock awards, subject to a repurchase right and vesting, The repurchase right which expired in March 2019 unexercised, gave the Company the option to repurchase a certain number of shares at par value based on a performance condition as defined in the terms of the HubPages Merger Agreement. The shares vest in twenty-four equal monthly installments beginning September 23, 2019 and ending September 23, 2021 and the estimated fair value of these shares is being recognized as compensation expense over the vesting period of the award. The restricted stock awards provide for a true-up period that if the common stock is sold for less than $2.50 the holder will receive, subject to certain conditions, additional shares of common stock up to a maximum of the amount of shares originally received (or 2,400,000 in aggregate to all holders) for the shares that re sold for less than $2.50. The true-up period, in general, is 13 months after the consummation of the HubPages Merger until 90 days following completion of vesting, or July 30, 2021. The restricted stock awards were fair valued upon issuance by an independent appraisal firm. For subsequent event related to these restricted stock awards see Note 24. On September 13, 2018, the Company issued 148,813 shares of common stock to certain members of the Board, as restricted awards, subject to continued service with the Company. The shares vest over a four-month period beginning September 30, 2018 and the estimated fair value of these shares is being recognized as compensation expense over the vesting period of the award. On October 1, 2018, the Company issued 57,693 shares of common stock to certain members of the Board, as restricted awards, subject to continued service with the Company. The shares vest over a three-month period beginning October 31, 2018 and the estimated fair value of these shares is being recognized as compensation expense over the vesting period of the award. The Company issued a total of 206,506 common stock awards to certain members of the Board during the year ended December 31, 2018. On December 12, 2018, in connection with the Say Media Merger, the Company issued a total of 2,000,000 restricted stock awards to acquire common stock of the Company to key personnel for continuing services with Say Media, subject to vesting, and repurchase rights under certain circumstances. The Company had the right to cancel for no consideration, or on a pro rata basis in certain circumstances, in the event the average monthly number of total unique users over a specified period did not meet certain user targets. As it was deemed probable the average monthly number of total unique would be satisfied at the time the restricted stock awards were issued, the Company determined the fair value of the restricted stock awards based on the quoted price of the Company’s common stock on the date issued. The shares vest one-third on the first anniversary date of issuance and then over twenty-four equal monthly installments after the first anniversary date and the estimated fair value of these shares is being recognized as compensation expense over the vesting period of the award. For subsequent event related to these restricted stock awards see Note 24. Unless otherwise stated, the fair value of a restricted stock award is determined based on the number of shares granted and the quoted price of the Company’s common stock on the date issued. A summary of the restricted stock award activity during the year ended December 31, 2018 is as follows: Weighted Average Number of Shares Grant-Date Unvested Vested Fair Value Restricted stock awards outstanding at January 1, 2018 6,979,596 5,537,556 $ 0.41 Issued 4,606,503 - 0.72 Vested (4,946,490 ) 4,946,490 Forfeited (329,735 ) - Restricted stock awards outstanding at December 31, 2018 6,309,874 10,484,046 0.50 As of December 31, 2018, total compensation cost for the restricted stock awards, including the effect of the waiver of the buy-back right, not yet recognized was $3,927,443. This cost will be recognized over a period of approximately 1.94 years. On December 20, 2018, a modification of a certain restricted stock award issued to an employee was recognized upon termination of employment, resulting in $43,750 of compensation expense at the time of the modification. The Company recorded the forfeited unvested restricted stock awards of 329,735 during the year ended December 31, 2018 on the consolidated statements of stockholders’ equity (deficiency). Information with respect to stock based compensation expense of the restricted stock awards is provided in Note 18. Common Stock Warrants Warrants issued to purchase shares of the Company’s common stock to MDB, L2, Strome, and B. Riley (collectively the “Financing Warrants”) are described below. MDB Warrants On October 19, 2017, the Company issued warrants to MDB which acted as placement agent in connection with a private placement of its common stock, to purchase 119,565 shares of common stock. The warrants have an exercise price of $1.15 per share, subject to customary anti-dilution adjustments, exercisable for a period of five years. On January 4, 2018, the Company issued warrants to MDB which acted as placement agent in connection with a private placement of its common stock, to purchase 60,000 shares of common stock. The warrants have an exercise price of $2.50 per share, subject to customary anti-dilution adjustments, and may, in the event there is no effective registration statement covering the re-sale of the warrant shares, be exercised on a cashless basis, exercisable for a period of five years. A total of 507,055 warrants are outstanding as of December 31, 2018. The MDB Warrants are recorded within the consolidated statements of stockholders’ equity (deficiency). L2 Warrants The warrants are exercisable for a period of five years, subject to customary anti-dilution adjustments, and may, in the event there is no effective registration statement covering the re-sale of the warrant shares, be exercised on a cashless basis in certain circumstances. A total of 1,066,963 warrants are outstanding as of December 31, 2018, requiring a share reserve under the warrant instrument calling for three times the number of warrants issuable for anti-dilution provisions, or a total reserve of 3,200,889 shares of common stock. Strome Warrants The January 4, 2018 financing transaction did not include any true-up or make-good provisions, nor did it contain any lock-up provisions, however, the March 30, 2018 financing transaction included a true-up provision and a lock-up provision. The true-up provision required the Company to issue additional shares of common stock if Strome sold shares on a national securities exchange or the OTC marketplace or in an arm’s-length unrelated third-party private sale in the 90-day period beginning one year after March 30, 2018 at less than $2.50 per share, up to a maximum of one share for each share originally sold to Strome. In addition, the Company entered into a separate agreement with Strome dated March 30, 2018 that extended the true-up provisions to the shares of common stock sold in the January 4, 2018 financing. Accordingly, under this true-up provision, which became effective March 30, 2018, the Company was obligated to issue up to an additional 1,700,000 shares of common stock to Strome without any further consideration under certain conditions in the future. As a result of the true-up provision, the maximum number of shares issuable in these transactions were 3,400,000 with a $1.25 floor price per share, and may, in the event there is no effective registration statement covering the re-sale of the warrant shares, be exercised on a cashless basis in certain circumstances. Effective as of August 3, 2018, pursuant to the reset provision, the Company adjusted the exercise price to $0.50 per share (the floor price) for such warrants. The Company accounted for the Strome Warrants, upon issuance, as a derivative liability because the warrants had a downward reset provision with a floor of $0.50 per share. The Company recorded the warrants at fair value in its consolidated balance sheets, with adjustments to fair value at each period-end. Upon issuance, the Company recognized a derivative liability of $1,344,648 which is reflected as a true-up termination fee on the consolidated statements of operations for the year ended December 31, 2018. As a result of the warrants exercise price being reduced to the floor exercise price on August 3, 2018 and the triggering of the reset provision, the warrants no longer contain any reset provisions and will continue to be carried on the consolidated balance sheets as a derivative liability at fair value, as adjusted at each period-end since, among other criteria, delivery of unregistered shares is precluded upon exercise. As of December 31, 2018, the carrying amount of the derivative liability was $587,971 (see Note 12). B. Riley Warrants The Company determined that the aforementioned $1.00 exercise price adjustment provisions were inconsequential since the Company did not anticipate issuing common stock or common stock equivalents that would trigger a subsequent financing condition, therefore, the fair value of the warrants were determined under a Black-Scholes pricing model and reflected as a warrant derivative liability upon issuance at fair value, as adjusted at each period-end. If at any time after the six-month anniversary of the issuance of the warrants, if there is no effective registration statement covering the re-sale of the shares of common stock underlying the warrants, the warrants may be exercised on a cashless basis. As of December 31, 2018, the carrying amount of the derivative liability was $358,050 (see Note 12). A summary of the Financing Warrants activity during the year ended December 31, 2018 is as follows: Weighted Average Weighted Remaining Number Average Contractual of Exercise Life Shares Price (in Years) Financing Warrants outstanding at January 1, 2018 1,289,172 $ 0.29 Issued 2,861,558 1.17 Exercised (842,117 ) 0.20 Issued as result of the reset provision on August 3, 2018 640,405 0.50 Financing Warrants outstanding at December 31, 2018 3,949,018 0.64 4.8 Financing Warrants exercisable at December 31, 2018 3,949,018 0.64 4.8 The exercise of the 842,117 warrants in April 2018 on a cashless basis resulting in the issuance of 736,853 net shares of common stock when the common stock price was $1.60 per share. The aggregate issue date fair value of the Financing Warrants issued during the year ended December 31, 2018 was $2,478,359. The intrinsic value of exercisable but unexercised in-the-money stock warrants as of December 31, 2018 was approximately $92,000, based on a fair market value of the Company’s common stock of $0.48 per share on December 31, 2018. The Financing Warrants outstanding, exercisable and reserved as of December 31, 2018 are summarized as follows: Exercise Price Expiration Date Financing Warrants Classified as Derivative Liabilities (Shares) Financing Warrants Classified within Stockholders’ Equity (Shares) Total Exercisable Financing Warrants (Shares) MDB Warrants $ 0.20 November 4, 2021 - 327,490 327,490 L2 Warrants 0.50 August 3, 2023 1,066,963 - 1,066,963 Strome Warrants 0.50 June 15, 2023 1,500,000 - 1,500,000 B. Riley Warrants 1.00 October 18, 2025 875,000 - 875,000 MDB Warrants 1.15 October 19, 2022 - 119,565 119,565 MDB Warrants 2.50 October 19, 2022 - 60,000 60,000 Total outstanding and exercisable 3,441,963 507,055 3,949,018 L2 Warrant reserve 2,133,926 - 2,133,926 Total outstanding, exercisable and reserved 5,575,889 507,055 6,082,944 Information with respect to the equity-based expense related to the Financing Warrants is provided in Note 18. |
Stock Based Compensation
Stock Based Compensation | 12 Months Ended |
Dec. 31, 2018 | |
Share-based Payment Arrangement [Abstract] | |
Stock Based Compensation | 18. Stock Based Compensation Common Stock Options On March 28, 2018, the Board approved an increase in the number of shares of the Company’s common stock reserved for grant pursuant to the 2016 Stock Incentive Plan (the “2016 Plan”) from 3,000,000 shares to 5,000,000 shares. In August 2018, the Company increased the authorized number of shares of common stock under the 2016 Plan from 5,000,000 shares to 10,000,000 shares. The Company’s shareholders approved the increase in the number of shares authorized under the 2016 Plan on April 3, 2020. The 2016 Plan is administered by the Board, and there were no grants prior to the formation of the 2016 Plan. Shares subject to an award that lapse, expire, are forfeited or for any reason are terminated unexercised or unvested will automatically again become available for issuance under the 2016 Plan. Common stock options issued under the 2016 Plan may have a term of up to ten years and may have variable vesting provisions. As of December 31, 2018, options to acquire 9,405,541 shares of the Company’s common stock had been granted under the 2016 Plan, and options to acquire 594,459 shares of common stock remain available for future grant. The estimated fair value of the stock based awards is recognized as compensation expense over the vesting period of the award. The fair value of the common stock option awards is estimated at the grant date as calculated using the Black-Scholes option-pricing model. The Black-Scholes model requires various highly judgmental assumptions including expected volatility and option life. The fair value of common stock options granted during the year ended December 31, 2018 were calculated using the Black-Scholes option-pricing model utilizing the following assumptions: Risk-free interest rate 2.27% to 3.05% Expected dividend yield 0.00 % Expected volatility 108.34% to 139.36% Expected life 3-6 years A summary of the common stock option activity during the year ended December 31, 2018 is as follows: Weighted Average Weighted Remaining Number Average Contractual of Exercise Life Shares Price (in Years) Common stock options outstanding at January 1, 2018 2,176,637 $ 1.25 9.25 Granted 8,187,750 0.84 Exercised (125,000 ) 0.17 Forfeited (732,353 ) 1.41 Expired (101,493 ) 1.49 Common stock options outstanding at December 31, 2018 9,405,541 0.61 9.30 Common stock options exercisable at December 31, 2018 1,853,186 1.14 8.77 The aggregate grant date fair value of common stock options granted during the year ended December 31, 2018 was $5,566,385. The aggregate intrinsic value as of December 31, 2018 and 2017 was none and $1,573,000, respectively. In conjunction with the Recapitalization, the Company assumed 175,000 fully vested common stock options having an exercise price of $0.17 per share and an expiration date of May 15, 2019. Of those options, 125,000 were exercised in June 2018 on a cashless basis resulting in the issuance of 106,154 net shares of common stock. The exercise prices of common stock options outstanding and exercisable are as follows as of December 31, 2018: Options Options Exercise Outstanding Exercisable Price (Shares) (Shares) Under $1.00 6,093,500 516,333 $1.01 to $1.25 1,707,482 921,946 $1.26 to $1.50 28,309 7,198 $1.51 to $1.75 345,000 108,542 $1.76 to $2.00 1,055,000 252,500 $2.01 to $2.25 135,000 5,417 $2.26 to $2.50 41,250 41,250 9,405,541 1,853,186 Outstanding options for 7,552,355 shares of the Company’s common stock had not vested at December 31, 2018. As of December 31, 2018, there was approximately $4,338,362 of total unrecognized compensation expense related to common stock options granted which is expected to be recognized over a weighted-average period of approximately 2.19 years. The intrinsic value of exercisable but unexercised in-the-money common stock options as of December 31, 2018 was approximately $7,750, based on a fair market value of the Company’s common stock of $0.48 per share on December 31, 2018. Outside Options The Company granted common stock options outside the 2016 Plan during the year ended December 31, 2018 to acquire shares of the Company’s common stock certain officers, directors and employees of the Company as approved by the Board and administered by the Company (the “Outside Options”) as follows: ● On November 2, 2018, 360,000 common stock options were granted which vest based on certain performance targets. ● On December 12, 2018, 354,000 common stock options were granted which vest over time. ● On December 13, 2018, 1,000,000 common stock options were granted which vest over time and 700,000 common stock options were granted which vest based on certain performance achievements or certain performance targets. The Company did not have sufficient authorized but unissued common shares to allow for the exercise of these stock options, therefore, these stock option grants were considered unfunded and were not exercisable until sufficient common shares were authorized (further details subsequent to the date of these consolidated financial statements are provided in Note 24 under the heading Sequencing Policy The fair value of common stock options granted during the year ended December 31, 2018 were calculated using the Black-Scholes option-pricing model utilizing the following assumptions: Risk-free interest rate 2.79% to 3.09% Expected dividend yield 0.00 % Expected volatility 113.49% to 116.86% Expected life 6 years Weighted Average Weighted Remaining Number Average Contractual of Exercise Life Shares Price (in Years) Stock options outstanding at January 1, 2018 - $ - - Granted 2,414,000 0.36 Stock options outstanding at December 31, 2018 2,414,000 0.36 9.94 Stock options exercisable at December 31, 2018 - - - The aggregate grant date fair value of common stock options granted during the year ended December 31, 2018 was $755,884. The aggregate intrinsic value as of December 31, 2018 was $277,820. As of December 31, 2018, there was approximately $733,875 of total unrecognized compensation expense related to common stock options granted which is expected to be recognized over a weighted-average period of approximately 2.92 years. Channel Partner Warrants At December 31, 2018, Channel Partner Warrants to purchase 4,215,500 shares of the Company’s common stock had been issued, and warrants to purchase 982,860, after considering the reduction in the total warrants available of 2,000,000, shares of common stock remain available for future grant. Upon the performance condition being met under the terms of the Channel Partner Warrants, such warrant will be earned and issued, and once earned will vest over three years and expire five years from issuance. The warrants are revalued each reporting period to determine the amount to be recorded as an expense in the respective period. As the warrants vest, they are valued on each vesting date. Channel Partner Warrants with performance conditions that do not have sufficiently large disincentive for non-performance are measured at fair value that is not fixed until performance is complete. The estimated fair value of the equity-based awards is recognized as an expense at the vesting date of the award. The fair value of the warrant is estimated at the vesting date as calculated using the Black-Scholes option-pricing model. The Black-Scholes model requires various highly judgmental assumptions including expected volatility and warrant life. The fair value of Channel Partner Warrants issued during the year ended December 31, 2018 were calculated using the Black-Scholes option-pricing model utilizing the following assumptions: Risk-free interest rate 2.53% to 2.89% Expected dividend yield 0.00 % Expected volatility 95.73% to 119.45% Expected life 3-5 years A summary of the Channel Partner Warrants activity during the year ended December 31, 2018 is as follows: Weighted Average Weighted Remaining Number Average Contractual of Exercise Life Shares Price (in Years) Channel Partner Warrants outstanding at January 1, 2018 1,303,832 $ 1.48 4.35 Issued 295,000 1.74 Exercised - - Forfeited (581,692 ) 1.47 Channel Partner Warrants outstanding at December 31, 2018 1,017,140 1.47 3.57 Channel Partner Warrants exercisable at December 31, 2018 319,944 1.39 3.54 The exercise prices range from $1.32 to $2.25 per share. There was no intrinsic value of exercisable but unexercised in-the-money Channel Partner Warrants since the fair market value of $0.48 per share of the Company’s common stock was lower than the exercise prices on December 31, 2018. A summary of stock based compensation and equity-based expense charged to operations or capitalized are summarized as follows: Restricted Common Channel Stock Stock Partner Awards Options Warrants Totals During the year ended December 31, 2018: Cost of revenue $ 6,745 $ - $ 152,460 $ 159,205 Research and development 100,926 95,941 - 196,867 General and administrative 2,872,732 1,112,020 - 3,984,752 Total costs charged to operations 2,980,403 1,207,961 152,460 4,340,824 Capitalized platform development 1,639,038 211,346 - 1,850,384 Total stock based compensation $ 4,619,441 $ 1,419,307 $ 152,460 $ 6,191,208 During the year ended December 31, 2017: Cost of revenue $ - $ - $ 229,720 $ 229,720 Research and development - - - - General and administrative 777,206 618,761 - 1,395,967 Total costs charged to operations 777,206 618,761 229,720 1,625,687 Capitalized platform development 614,573 - - 614,573 Total stock based compensation $ 1,391,779 $ 618,761 $ 229,720 $ 2,240,260 |
Settlement of Promissory Notes
Settlement of Promissory Notes Receivable | 12 Months Ended |
Dec. 31, 2018 | |
Settlement Of Promissory Notes Receivable | |
Settlement of Promissory Notes Receivable | 19. Settlement of Promissory Notes Receivable On March 19, 2018, the Company entered into a non-binding letter of intent (the “Letter of Intent”) to acquire Say Media, a media and publishing technology company. Pursuant to the Letter of Intent, Maven loaned Say Media $1,000,000 under a secured promissory note dated March 26, 2018 payable on the six month anniversary of the earlier of (i) the termination of the Letter of Intent, or (ii) if Maven and Say Media should execute a definitive agreement (as defined in the Letter of Intent), the termination of the definitive agreement (such date, the “Maturity Date”). Under the secured promissory note, interest shall accrue at a rate of 5% per annum, with all accrued and unpaid interest payable on the Maturity Date, with prepayment permitted at any time without premium or penalty. In the event of default, interest would accrue at a rate of 10%. Additional promissory notes were issued as follows: (1) on July 23, 2018, a secured promissory note in the principal amount of $250,000, with a Maturity Date and interest terms as outlined above; (2) on August 21, 2018, a senior secured promissory note in the principal amount of $322,363, due and payable on February 21, 2019, with interest terms as outlined above; (3) on November 30, 2018, a senior secured promissory note in the principal amount of $4,322,166, due and payable on or before the first business day following the earlier of (i) the consummation of the Closing, as defined under the Say Media Merger Agreements, and (ii) February 21, 2019, with interest terms as outlined above; totaling $5,894,529 in promissory notes as of December 12, 2018. On December 12, 2018 pursuant to the Say Media Merger Agreements entered into on October 12, 2018 and amended on October 17, 2018, the Company settled the promissory notes receivable by effectively forgiving $3,366,031 of the balance due at closing as reflected on the consolidated statements of operations. The remainder of the promissory notes consisting of $2,078,498 advanced for the execution payments in connection with the acquisition, and $450,000 advanced for acquisition related legal fees of Say Media where reflected as part of the purchase price. |
Liquidated Damages
Liquidated Damages | 12 Months Ended |
Dec. 31, 2018 | |
Liquidated Damages | |
Liquidated Damages | 20. Liquidated Damages The Company recognized Liquidated Damages during the year ended December 31, 2018, with respect to its registration rights agreements and securities purchase agreements as follows: MDB Common Stock to Be Issued Series H Preferred Stock 12% Convertible Debentures Total Liquidated Damages Registration Rights Damages $ 15,001 $ 1,163,955 $ - $ 1,178,956 Public Information Failure Damages - 1,163,955 706,944 1,870,899 Accrued interest - 481,017 116,726 597,743 Totals $ 15,001 $ 2,808,927 $ 823,670 $ 3,647,598 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 21. Income Taxes The components of the benefit for income taxes is as follows: Years Ended December 31, 2018 2017 Current tax benefit Federal $ - $ - State and local - - Total current tax benefit - - Deferred tax benefit Federal 3,359,203 920,356 State and local 1,498,009 - Change in valuation allowance (4,765,579 ) (920,356 ) Total deferred tax benefit 91,633 - Total income tax benefit $ 91,633 $ - On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (“TCJA”). The TCJA reduces the U.S. federal corporate tax rate from 35% to 21%, imposes a one-time repatriation tax, and numerous other provisions transitioning to a territorial system. Proposed amendments to the Income Tax Regulations under Section 163(j) of the U.S. Internal Revenue Code were issued on November 26, 2018 and are effective for the taxable year 2019 after publication in the Federal Register, at which time they will be adopted by the Company. Additional discussion of the impact of the TCJA on the consolidated financial statements is included below. The components of deferred tax assets and liabilities were as follows: As of December 31, 2018 2017 Deferred tax assets Net operating loss carryforwards $ 10,474,525 $ 1,544,591 Tax credit carryforwards 263,873 - Accrued expenses and other 64,849 38,328 Allowance for doubtful accounts 16,017 - Deferred rent 21,233 - Contract liabilities 84,622 3,631 Liquidating damages payable 646,146 - Stock based compensation 242,545 119,807 Depreciation and amortization 981,850 - Current deferred tax assets 12,795,660 1,706,357 Valuation allowance (8,541,191 ) (1,353,207 ) Total deferred tax assets 4,254,469 353,150 Deferred tax liabilities Depreciation and amortization - (353,150 ) Acquisition-related intangibles (4,254,469 ) - Total deferred tax liabilities (4,254,469 ) (353,150 ) Net deferred tax $ - $ - The Company must make judgements as to the realization of deferred tax assets that are dependent upon a variety of factors, including the generation of future taxable income, the reversal of deferred tax liabilities, and tax planning strategies. To the extent that the Company believes that recovery is not likely, it must establish a valuation allowance. A valuation allowance has been established for deferred tax assets which the Company does not believe meet the “more likely than not” criteria. The Company’s judgments regarding future taxable income may change due to changes in market conditions, changes in tax laws, tax planning strategies or other factors. If the Company’s assumptions and consequently its estimates change in the future, the valuation allowances it has established may be increased or decreased, resulting in a respective increase or decrease in income tax expense. Based upon the Company’s historical operating losses and the uncertainty of future taxable income, the Company has provided a valuation allowance primarily against its deferred tax assets up to the deferred tax liabilities as of December 31, 2018 and 2017. Based on provisions of the TCJA, the Company remeasured the deferred tax assets and liabilities during the year ended December 31, 2017 based on the rates at which they are expected to reverse in the future, which is generally 21%. Accordingly, the Company recorded a provisional tax expense of approximately $838,000 associated with the remeasurement of its deferred tax balances. However, as it recognize a valuation allowance on deferred tax assets if it is more likely than not that the assets will not be realized in future years, there was no impact to the effective tax rate, as any change to deferred taxes are offset by the valuation allowance. As of December 31, 2018, the Company had federal, state, and local net operating loss carryforwards available of approximately $36.65 million, $33.93 million, and $8.15 million, respectively, to offset future taxable income. Net operating losses for U.S. federal tax purposes of $15.50 (limited to 80% of taxable in given year) do not expire and $21.15 will expire, if not utilized, through 2037 in various amounts. As of December 31, 2017, the Company had federal net operating loss carryforwards available of approximately $7.3 million to offset future taxable income. Internal Revenue Code Section 382 and 383 imposes limitations on the utilization of net operating loss carryforwards in the event of a cumulative change in ownership of more than 50% within any three-year period since the last ownership change. The Company believes that it did have a change in control under these Sections in connection with its Recapitalization on November 4, 2016 and utilization of the carryforwards would be limited such that the majority of the carryforwards will never be available. Accordingly, the Company has not recorded those net operating loss carryforwards and credit carryforwards in its deferred tax assets. Further, the Company may have experienced additional control changes under these Sections as a result of recent financing activities. However, the Company does not anticipate performing a complete analysis of the limitation on the annual use of the net operating loss carryforwards until the time that it anticipates it will be able to utilize these tax attributes. This could impose an annual limit on the Company’s ability to utilize net operating loss carryforwards and could cause U.S. federal income taxes to be paid earlier than otherwise would be paid if such limitations were not in effect. The U.S. federal net operating loss carryforwards are stated before any such anticipated limitations as of December 31, 2018. The benefit for income taxes on the statement of operations differs from the amount computed by applying the statutory federal income tax rate to loss before the benefit for income taxes, as follows: Years Ended December 31, 2018 2017 Amount Percent Amount Percent Federal benefit expected at statutory rate $ (5,493,498 ) 21.0 % $ (2,136,666 ) 34.0 % State and local taxes, net of federal benefit (1,498,009 ) 5.7 % - 0.0 % Impact of tax rate change - 0.0 % 837,699 (13.3 )% Stock based compensation 434,556 (1.7 )% - 0.0 % Other differences, net 246,614 (0.8 )% - 0.0 % Valuation allowance 4,765,579 (18.2 )% 920,356 (14.7 )% Permanent differences 1,453,125 (5.6 )% 378,611 (6.0 )% Tax benefit and effective income tax rate $ (91,633 ) 0.4 % $ - 0.0 % The Company recognizes the tax benefit from uncertain tax positions only if it is “more likely than not” that the tax positions will be sustained on examination by the tax authorities, based on the technical merits of the position. The tax benefit is measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The Company recognizes interest and penalties related to income tax matters in income tax expense. The Company is also required to assess at each reporting date whether it is reasonably possible that any significant increases or decreases to its unrecognized tax benefits will occur during the next 12 months. The Company did not recognize any uncertain tax positions or any accrued interest and penalties associated with uncertain tax positions for the years ended December 31, 2018 and 2017. The Company files tax returns in the U.S federal jurisdiction and New York, California, and other states. The Company is generally subject to examination by income tax authorities for three years from the filing of a tax return, therefore, the federal and certain state returns from 2015 forward and the California returns from 2014 forward are subject to examination. The Company currently is not under examination by any tax authority. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 22. Related Party Transactions On April 4, 2017, the Company completed a private placement of its common stock, selling 3,765,000 shares at $1.00 per share, for total gross proceeds of $3,765,000. In connection with the offering, the Company paid $188,250 in cash and issued 162,000 shares of its common stock to MDB, which acted as placement agent. On October 19, 2017, the Company completed a private placement of its common stock, selling 2,391,304 shares at $1.15 per share, for total gross proceeds of $2,750,000. In connection with the offering, the Company issued 119,565 shares of its common stock and warrants to purchase 119,565 shares of its common stock to MDB, which acted as placement agent. On January 4, 2018, the Company completed a private placement of its common stock, selling 1,200,000 shares at $2.50 per share, for total gross proceeds of $3,000,000. In connection with the offering, MDB, which acted as placement agent, was entitled to 60,000 shares of its common stock and warrants to purchase 60,000 shares of its common stock. On June 15, 2018, four investors invested a total of $4,775,000 in a 10% convertible debt offering. Included in the total was an investment of $3,000,000 by Strome who beneficially owns more than 10% of the shares of the Company’s common stock, $1,000,000 by the Company’s then Chief Executive Officer, James C. Heckman, and $25,000 from the Company’s then President, Joshua Jacobs, totaling $4,025,000. Interest was payable on the convertible debt at the rate of 10% per annum, payable in cash semi-annually on December 31 and June 30, and on maturity, beginning on December 31, 2018, and the convertible debt was due and payable on June 30, 2019. The 10% convertible debt was converted on August 10, 2018, as described below, where the investors received additional interest payments to provide the investor with a 20% annual internal rate of return. Upon conversion, Strome received $600,000, James C. Heckman received $200,000, and Joshua Jacobs received $5,000 in satisfaction of the 20% annual internal rate of return by issuing additional shares of the Series H Preferred Stock. On June 15, 2018, the Company also modified two previous securities purchase agreements dated January 4, 2018 and March 30, 2018 with Strome to eliminate a true-up provision entered into on March 30, 2018 under which the Company was committed to issue up to 1,700,000 shares of the Company’s common stock in certain circumstances. As consideration for such modification, the Company issued a warrant to Strome to purchase 1,500,000 shares of the Company’s common stock, exercisable at an initial price of $1.19 per share for a period of 5 years. On August 10, 2018, the Company closed on a securities purchase agreement with certain accredited investors, pursuant to which it issued an aggregate of 19,400 shares of Series H Preferred Stock at a stated value of $1,000, initially convertible into 58,787,879 shares of its common stock, at the option of the holder subject to certain limitations, at a conversion rate equal to the stated value divided by the conversion price of $0.33 per share, for aggregate gross proceeds of $19,399,250. Of the shares of Series H Preferred Stock issued, Strome received 3,600, James C. Heckman, or an affiliated entity, received 1,200, and Joshua Jacobs received 30 shares upon conversion of the 10% convertible debt. On August 10, 2018, B. Riley FBR, acted as placement agent for the Series H Preferred Stock financing, and was paid in cash $575,000, for its services as placement agent, and issued 669 shares (stated value of $1,000 per share) of Series H Preferred Stock. On October 18, 2018, the Company entered into a securities purchase agreement with two accredited investors, B. Riley and an affiliated entity of B. Riley, pursuant to which it issued to the investors the 10% OID Convertible Debentures resulting in net proceeds of $3,285,000. B. Riley’s legal fees and expenses of $40,000 were netted from the proceeds received by them. The Company issued warrants to B. Riley to purchase up to 875,000 shares of the Company’s common stock in connection with this securities purchase agreement. On December 12, 2018, the Company converted the 10% OID Convertible Debentures to the 12% Convertible Debentures under a securities purchase agreement with three accredited investors, for aggregate proceeds of $3,551,528, which included principal and interest of the 10% OID Convertible Debentures. Upon conversion, interest of $82,913 was recorded for the 10% OID Convertible Debentures held by B. Riley. The Company received net proceeds from B. Riley or its affiliated entities of $8,950,000 under 12% Convertible Debentures. The Company paid B. Riley FBR cash of $540,000 as placement agent in the offering. B. Riley’s legal fees and expenses of $50,000 were netted from the proceeds received by them. The 12% Convertible Debentures are due and payable on December 31, 2020. Interest accrues at the rate of 12% per annum, payable on the earlier of conversion or December 31, 2020. The Company’s obligations under the 12% Convertible Debentures are secured by a security agreement, dated as of October 18, 2018. Board of Directors and Finance Committee During September 2018, John A. Fichthorn joined the Company’s Board and during November 2018 he was elected as Chairman of the Company’s Board and Chairman of the Company’s Finance Committee. Until March of 2020, Mr. Fichthorn served as Head of Alternative Investments for B. Riley Capital Management, LLC, which is an SEC-registered investment adviser and a wholly-owned subsidiary of B. Riley. During September 2018, Todd D. Sims joined the Company’s Board and is also a member of the board of directors of B. Riley. Mr. Sims serves on the Company’s Board as a designee of B. Riley. Since August 2018, B. Riley FBR has been instrumental in raising debt and equity capital for the Company to support its acquisitions and for refinancing and working capital purposes (as described in Note 2). Mr. Christopher Marlett was a director of the Company until February 1, 2018. Mr. Marlett is the Chief Executive Officer of MDB. Mr. Gary Schuman, who was the Chief Financial Officer of the Company until May 15, 2017, is the Chief Financial Officer and Chief Compliance Officer of MDB. The Company compensated Mr. Schuman for his services at the rate of $3,000 per month until his resignation. Mr. Robert Levande was a director of the Company until July 5, 2017. Mr. Levande is a senior managing director of MDB. Service Contracts Ms. Rinku Sen joined the Company’s Board in November 2017 and has provided consulting services and operates a channel on the Company’s platform. During the years ended December 31, 2018 and 2017, the Company paid Ms. Sen $15,521 and $15,000, respectively, for these services. Effective on September 20, 2017, the Company entered into a six-month contract, with automatic renewals unless cancelled, with a company located in Nicaragua that is owned by Mr. Christopher Marlett, a then member of the Company’s Board, to provide content conversion services. During the years ended December 31, 2018 and 2017, the Company paid $76,917 and $11,700, respectively, for these services. Officer Promissory Notes In May 2018, the Company’s then Chief Executive Officer began advancing funds to the Company in order to meet minimum operating needs. Such advances were made pursuant to promissory notes that were due on demand, with interest at the minimum applicable federal rate, which was approximately 2.34% as of December 31, 2018. At December 31, 2018, the total principal amount of advances outstanding, including accrued interest of $12,574, was $680,399. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 23. Commitments and Contingencies Operating Lease On April 25, 2018, the Company entered into an office sublease agreement to sublease of 7,457 rentable square feet at 1500 Fourth Avenue, Suite 200, Seattle, Washington. The sublease commenced on June 1, 2018 and expires on October 31, 2021. Monthly rental payments are as follows: (1) initial twelve-month term $16,126; (2) next twelve-month term $21,750; (3) next twelve-month term $22,371; and (4) remainder five-month term $22,993; for total minimum lease payments of $837,935. Upon execution of the sublease in April 2018, the Company paid $44,121 as prepaid rent and a security deposit of $22,992 reflected within other long term assets on the consolidated balance sheets. On March 1, 2020, the Company discontinued its co-mingling agreement with the tenant and assumed the entire lease for the remaining term of 20 months. The base rent increased to $34.20 per square foot per annum in months 22 through 29, rising to $35.22 per square foot in months 30 through 41. On September 19, 2018, the Company entered into a lease for office space located at 995 Market Street, San Francisco, California. The lease commenced on October 1, 2018 with a term of one year. The lease provides for monthly payments of $12,180. The Company has a security deposit of $25,812 reflected within prepayments and other current assets on the consolidated balance sheets. On December 12, 2018, as part of its acquisition of Say Media, Inc., the Company assumed an office sublease agreement dated July 1, 2015 for 5,000 rentable square feet at 428 SW Fourth Ave, Portland, Oregon 97204. The lease commenced on December 12, 2018 and expires on June 30, 2020. The sublease provides for monthly rental payments of $13,438 through June 30, 2019, and $13,750 until the end of the lease term. The Company has a security deposit of $55,000 reflected within other long term assets on the consolidated balance sheets. The following table shows the aggregate commitment by year: Years ending December 31, 2019 $ 505,621 2020 347,845 2021 226,817 $ 1,080,283 Rent expense for the years ended December 31, 2018 and 2017 was $253,651 and $69,000, respectively. The Company is currently evaluating the impact that the adoption of ASC Topic 842, Leases Revenue Guarantee On a select basis, the Company has provided revenue share guarantees to certain independent publishers that transition their publishing operations from another platform to theMaven.net or maven.io. These arrangements generally guarantee the publisher a monthly amount of income for a period of 12 to 24 months from inception of the publisher contract that is the greater of (a) a fixed monthly minimum, or (b) the calculated earned revenue share. During the years ended December 31, 2018 and 2017, the Company paid Channel Partner guarantees of $1,456,928 and $560,000, respectively. As of December 31, 2018, the aggregate commitment was $11,500 which is due during the year ending December 31, 2019. Claims and Litigation From time to time, the Company may be subject to claims and litigation arising in the ordinary course of business. The Company is not currently a party to any pending or threatened legal proceedings that it believes would reasonably be expected to have a material adverse effect on the Company’s business, financial condition, results of operations or cash flows. Liquidated Damages Contingent obligations with respect to Public Information Failure Damages for the 12% Convertible Debentures were $78,548 as of December 31, 2018. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | 24. Subsequent Events The Company performed an evaluation of subsequent events through the date of filing of these consolidated financial statements with the SEC. Other than the below described subsequent events, there were no material subsequent events which affected, or could affect, the amounts or disclosures on the consolidated financial statements. 2019 Equity Incentive Plan On April 4, 2019, the Board approved and the Company adopted the 2019 Equity Incentive Plan (the “2019 Plan”). The purpose of the 2019 Plan is to seek, to better secure, and to retain the services of a select group of persons, to provide incentives for those persons to exert maximum efforts for the success of the Company and its affiliates, and to provide a means by which those persons have an opportunity to benefit from increases in the value of the Company’s common stock through the granting of stock awards. The 2019 Plan allows the Company to grant statutory and non-statutory stock options, stock appreciation rights, restricted stock awards and/or restricted stock units awards to acquire shares of the Company’s common stock to the Company’s employees, directors and consultants, of which certain awards require the achievement of certain price targets of the Company’s common stock. From April 10, 2019 through the issuance date of these consolidated financial statements, the Company granted stock options and restricted stock units, of which 81,592,584 are outstanding as of the issuance date of these consolidated financial statements, to acquire shares of the Company’s common stock to officers, directors, employees and consultants. The Company’s shareholders approved the 2019 Plan and the maximum number of shares authorized of 85,000,000 under the plan on April 3, 2020. The Company did not have sufficient authorized but unissued common shares to allow for the exercise of the stock options granted under this plan; accordingly, any stock option grants under this plan were considered unfunded and were not permitted to be exercised until sufficient common shares were authorized (further details are provided under the heading Sequencing Policy Restricted Stock From January 1, 2019 through the issuance date of these consolidated financial statements, the Company granted restricted stock awards, of which 1,395,833 are outstanding as of the issuance date of these consolidated financial statements, for shares of common stock. On May 31, 2019, the Company granted 2,399,997 restricted stock units for shares of its common stock, to the holders of the restricted stock awards issued in connection with the HubPages Merger in consideration for an amendment to the true up provisions. On December 15, 2020, the Company entered into the fourth amendment in connection with the HubPages Merger in consideration for an amendment to the true up provisions are described above, where, among other things, the amendment provides that: ● the restricted stock awards will cease to vest and all unvested shares will be deemed unvested and forfeited, leaving an aggregate of 1,064,549 shares vested; ● the restricted stock units will be modified to vest on December 31, 2020 and as of the close of business on December 31, 2020, each restricted stock unit will be terminated and deemed forfeited, with no shares vesting thereunder; and ● subject to certain conditions, the Company agreed to purchase from certain key personnel of HubPages who agreed to continue their employment, the vested restricted stock awards and restricted stock units, at a price of $4.00 per share in 24 equal monthly installments on the second business day of each calendar month beginning on January 4, 2021. On December 11, 2019, the Company modified the restricted stock awards vesting provisions issued in connection with the Say Media Merger to remove the repurchase rights, such that they will vest in six equal installments at four-month intervals on the twelfth of each month, starting on December 12, 2019, with the final vesting date on August 12, 2021. Outside Options From January 1, 2019 through the issuance date of these consolidated financial statements, the Company granted stock options, of which 1,500,000 are outstanding as of the issuance date of these consolidated financial statements, to acquire shares of the Company’s common stock to officers, directors and employees outside of the 2016 Plan and the 2019 Plan. The Company did not have sufficient authorized but unissued common shares to allow for the exercise of the stock options granted under this plan; accordingly, any stock option grants under this plan were considered unfunded and were not permitted to be exercised until sufficient common shares were authorized (further details are provided under the heading Sequencing Policy 12% Convertible Debentures On March 18, 2019, the Company entered into a securities purchase agreement with two accredited investors, including John Fichthorn, the Company’s Chairman of the Board, pursuant to which the Company issued 12% Convertible Debentures in the aggregate principal amount of $1,696,000, which includes a placement fee of $96,000 paid to B. Riley FBR in the form of a 12% Convertible Debenture, for acting as the Company’s placement agent in the offering. After taking into account legal fees and expenses of $10,000 which were paid in cash, the Company received net proceeds of $1,590,000. On March 27, 2019, the Company entered into a securities purchase agreement with an accredited investor pursuant to which the Company issued 12% Convertible Debentures in the aggregate principal amount of $318,000, which includes a placement fee of $18,000 paid to B. Riley FBR in the form of a 12% Convertible Debenture for acting as the Company’s placement agent in the offering. After taking into account legal fees and expenses, the Company received net proceeds of $300,000. On April 8, 2019, the Company entered into a securities purchase agreement with an accredited investor, Todd D. Sims, a member of the Company’s Board, pursuant to which the Company issued a 12% Convertible Debenture in the aggregate principal amount of $100,000. In connection with this placement, B. Riley FBR waived its placement fee of $6,000 for acting as the Company’s placement agent in the offering. After taking into account legal fees and expenses, the Company received net proceeds of $100,000. The 12% Convertible Debentures issued on March 18, 2019, March 27, 2019 and April 8, 2019 are convertible into shares of the Company’s common stock at the option of the investor at any time prior to December 31, 2020, at a conversion price of $0.40 per share, subject to adjustment for stock splits, stock dividends and similar transactions, and beneficial ownership blocker provisions. All other terms, except as noted below, of the 12% Convertible Debentures issued on March 18, 2019, March 27, 2019 and April 8, 2019 are identical to the 12% Convertible Debentures issued on December 12, 2018. Pursuant to the registration rights agreements entered into in connection with the securities purchase agreements on March 18, 2019, March 27, 2019 and April 8, 2019, the Company agreed to register the shares issuable upon conversion of the 12% Convertible Debentures for resale by the investors. The Company committed to file the registration statement the later of (i) the 30th calendar day following the date the Company files its Annual Report on Form 10-K for the fiscal year ended December 31, 2018 with the SEC, but in no event later than May 15, 2019, and (ii) the 30th calendar day after all the common stock issuable on the conversion of the Series H Preferred Stock have been registered pursuant to a registration statement under a certain registration rights agreement, dated as of August 9, 2018. The registration rights agreements provide for Registration Rights Damages (as further described in Note 11) upon the occurrence of certain events up to a maximum amount of 6% of the aggregate amount invested (further details are provided under the heading Liquidating Damages The securities purchase agreements also included a provision that requires the Company to maintain its periodic filings with the SEC in order to satisfy the public information requirements under Rule 144(c) of the Securities Act. If the Company fails for any reason to satisfy the current public information requirement commencing from the six (6) month anniversary date of issuance of the 12% Convertible Debentures, then the Company will be obligated to pay Public Information Failure Damages (as further described in Note 11) to each holder, consisting of a cash payment equal to 1% of the amount invested as partial liquidated damages, up to a maximum of six months, subject to interest at the rate of 1% per month until paid in full (further details are provided under the heading Liquidating Damages On December 31, 2020, noteholders converted the 12% Convertible Debentures representing an aggregate of $18,104,949 of the then-outstanding principal and accrued but unpaid interest into 53,887,470 shares of the Company’s common stock at effective conversion per-share prices ranging from $0.33 to $0.40. Despite the terms of the 12% Convertible Debentures, the noteholders agreed to allow the Company to repay accrued but unpaid interest in shares of the Company’s common stock. The remaining 12% convertible debentures representing an aggregate of $1,130,903 of outstanding principal and accrued interest were not converted and, instead, such amounts were repaid in cash to the noteholders. Appointment of New Chief Financial Officer On May 3, 2019, the Company announced the appointment of Douglas B. Smith as the Company’s Chief Financial Officer. Pursuant to the terms of an Employment Agreement with the Company, dated as of May 1, 2019, Mr. Smith shall receive an annual salary of $400,000 and be entitled to receive bonuses to be agreed by Company and Mr. Smith in good faith from time to time based on then current financial status of the Company. If Mr. Smith’s employment with the Company is terminated by the Company Without Cause or by Mr. Smith for Good Reason (as those terms are defined in the Employment Agreement), then Mr. Smith shall be entitled to receive a lump sum payment equal to six months of his annual salary. Mr. Smith was granted options to purchase up to 1,500,000 shares of the Company’s common stock, having an exercise price of $0.57 per share, a term of 10 years, and subject to vesting as described below. These options were granted outside of the 2016 Plan and the 2019 Plan. Of the 1,500,000 options granted: (i) 1,000,000 options will vest over 36 months, with 1/3 vesting after 12 months of continuous service and 1/36 vesting monthly for each month of continuous service thereafter; and (ii) 500,000 will vest over 36 months, with 1/3 vesting after 12 months of continuous service and 1/36 vesting monthly for each month of continuous service thereafter, subject to the Company’s common stock being listed on a national securities exchange. Mr. Smith was also granted options to purchase up to 1,064,008 shares of the Company’s common stock, having an exercise price of $0.46 per share, a term of 10 years, and subject to vesting based both on time and targets tied to the Company’s common stock, as follows: (i) the options will vest over 36 months, with 1/3 vesting after 12 months of continuous service and 1/36 vesting monthly for each month of continuous service thereafter; and (ii) the Company’s common stock must be listed on a national securities exchange, with incremental vesting upon achievement of certain stock price targets based on a 45-day VWAP during which time the average monthly trading volume of the common stock must be at least 15% of the Company’s aggregate market capitalization. Acquisition of TheStreet, Inc. and Relationship with Cramer Digital On June 11, 2019, the Company, TST Acquisition Co., Inc., a Delaware corporation (“TSTAC”), a newly-formed indirect wholly-owned subsidiary of the Company, and TheStreet, Inc., a Delaware corporation (“TheStreet”), entered into an agreement and plan of merger, pursuant to which TSTAC will merge with and into TheStreet, with TheStreet continuing as the surviving corporation in the merger and as a wholly-owned subsidiary of the Company. The merger agreement provided that all issued and outstanding shares of common stock of TheStreet (other than those shares with respect to which appraisal rights have been properly exercised) will be exchanged for an aggregate of $16,500,000 in cash. Pursuant to the terms of the merger agreement, on June 10, 2019, the Company deposited $16,500,000 into an escrow account pursuant to an escrow agreement, dated June 10, 2019, by and among the Company, TheStreet and Citibank, N.A., as escrow agent. On August 7, 2019, the Company consummated the merger between TheStreet and TSTAC, pursuant to which TSTAC merged with and into TheStreet, with TheStreet continuing as the surviving corporation in the merger and as an indirect wholly-owned subsidiary of the Company, pursuant to the terms of the merger agreement dated as of June 11, 2019, as amended. In connection with the consummation of the merger, the Company paid a total of $16,500,000 in cash to TheStreet’s stockholders. This transaction was funded through a debt financing arranged by a subsidiary of B. Riley Financial, Inc. (further details are provided under the heading 12% Senior Secured Notes On August 8, 2019, in connection with the Street Merger, finance and stock market expert Jim Cramer, who co-founded TheStreet, Inc. agreed to enter into an agreement with Street through Cramer Digital, Inc. (“Cramer”), a production company featuring the digital rights and content created by Mr. Cramer and his team of financial experts. The agreement provides for Mr. Cramer to create video content for Maven on each business day during the term and certain other series of videos (the “Cramer Content”). The Company will pay a commission during the term equal to twenty-five percent of the net advertising revenue generated, received and collected by the Company from the Cramer Content. The Company will pay $3,000,000 as an annualized guaranteed payment in monthly installments beginning May 1, 2020, recoupable against all net advertising revenue generated, received and collected by the Company with respect to the Cramer Content. The agreement further provides that the Company will reimburse fifty percent of the cost of rented office by Cramer, up to a maximum of $4,250 per month. The Company expects that TheStreet’s senior management will continue with the Company subsequent to the merger. 12% Senior Secured Notes On June 10, 2019, the Company entered into a note purchase agreement with one accredited investor, BRF Finance Co., LLC, an affiliated entity of B. Riley, pursuant to which the Company issued to the investor a 12% senior secured note, due July 31, 2019, in the aggregate principal amount of $20,000,000, which after taking into account B. Riley’s placement fee of $1,000,000 and legal fees and expenses of the investor, resulted in the Company receiving net proceeds of $18,865,000, of which $16,500,000 was deposited into the escrow account to fund TheStreet merger consideration and the balance of $2,365,000 was to be used by the Company for working capital and general corporate purposes. The note has been amended and restated and is no longer outstanding (further details are provided under the heading 12% Amended Senior Secured Notes ABG-SI LLC Licensing Agreement On June 14, 2019, the Company and ABG-SI LLC (“ABG”), a Delaware limited liability company and indirect wholly-owned subsidiary of Authentic Brands Group, entered into a licensing agreement (the “Licensing Agreement”) pursuant to which the Company shall have the exclusive right and license in the United States, Canada, Mexico, United Kingdom, Republic of Ireland, Australia and New Zealand to operate the Sports Illustrated media business (in the English and Spanish languages), including to (i) operate the digital and print editions of Sports Illustrated Sports Illustrated for Kids The initial term of the Licensing Agreement shall commence upon the termination of the Meredith License Agreement (as defined below) and shall continue through December 31, 2029. The Company has the option, subject to certain conditions, to renew the term of the Licensing Agreement for nine consecutive renewal terms of 10 years each (collectively, the “Term”), for a total of 100 years. The Licensing Agreement provides that the Company shall pay to ABG annual royalties in respect of each year of the Term based on gross revenues (“Royalties”) with guaranteed minimum annual amounts. The Company has prepaid ABG $45,000,000 against future Royalties. ABG will pay to the Company a share of revenues relating to certain Sports Illustrated business lines not licensed to the Company, such as commerce. The two companies will be partnering in building the brand worldwide. Pursuant to an agreement between ABG and Meredith Corporation (“Meredith”), an Iowa corporation, Meredith operated the licensed brands under license from ABG (the “Meredith License Agreement). On October 3, 2019 Maven, ABG and Meredith entered into a Transition Services Agreement and an Outsourcing Agreement whereby the parties agreed to the terms and conditions under which Meredith would continue to operate certain aspects of the licensed brands, and provide certain services during the fourth quarter of 2019 as all activities were transitioned over to Maven. Through these agreements, Maven took over operating control of the Sports Illustrated licensed brands. The Company issued ABG warrants to acquire 21,989,844 shares of the Company’s common stock (the “Warrants”). Half the Warrants shall have an exercise price of $0.42 per share (the “Forty-Two Cents Warrants”). The other half of the Warrants shall have an exercise price of $0.84 per share (the “Eighty-Four Cents Warrants”). The Warrants provide for the following: (1) 40% of the Forty-Two Cents Warrants and 40% of the Eighty-Four Cents Warrants shall vest in equal monthly increments over a period of two years beginning on the one year anniversary of the date of issuance of the Warrants (any unvested portion of such Warrants to be forfeited by ABG upon certain terminations by the Company of the Licensing Agreement); (2) 60% of the Forty-Two Cents Warrants and 60% of the Eighty-Four Cents Warrants shall vest based on the achievement of certain performance goals for the licensed brands in calendar years 2020, 2021, 2022 or 2023; (3) under certain circumstances the Company may require ABG to exercise all (and not less than all) of the Warrants, in which case all of the Warrants shall be vested; (4) all of the Warrants shall automatically vest upon certain terminations of the Licensing Agreement by ABG or upon a change of control of the Company; and (5) ABG shall have the right to participate, on a pro-rata basis (including vested and unvested Warrants, exercised or unexercised), in any future equity issuance of the Company (subject to customary exceptions). Additionally, Ross Levinsohn, the former senior executive from Fox and Yahoo!, had agreed to become the new Chief Executive Officer of the licensed brands. Mr. Levinsohn was a director of the Company from November 4, 2016 through October 20, 2017. In conjunction with Mr. Levinsohn’s services as a director of the Company, he received restricted stock awards for 245,434 shares of the Company’s common stock. Mr. Levinsohn retained his restricted stock awards and they continued to vest subsequent to his resignation from the Board on October 20, 2017. The restricted stock awards will continue to vest through October 16, 2019. In conjunction with the vesting of the restricted stock awards, the Company recognized stock based compensation cost of $88,235 and $46,611 for the years ended December 31, 2018 and 2017, respectively, which was included in general and administrative expenses on the consolidated statements of operations. On April 10, 2019, the Company entered into an Advisory Services Agreement with Mr. Levinsohn to provide advisory services with respect to strategic transactions in the media and digital publishing industries, in exchange for which Mr. Levinsohn was granted a stock option to purchase 532,004 shares of the Company’s common stock, exercisable for a period of 10 years at $0.46 per share (the closing market price on April 10, 2019) subject to vesting (i) based on the achievement by the Company of stock price and liquidity targets and becoming listed on a national securities exchange and (ii) a concurrent 36-month vesting period with a 12-month cliff, and were not exercisable until the Company increased its authorized shares of common stock to a sufficient number to permit the full exercise of the stock options granted; accordingly, these stock option grants were considered unfunded and were not permitted to be exercised until sufficient common shares were authorized (further details are provided under the heading Sequencing Policy On June 11, 2019, Mr. Levinsohn was granted stock options, in conjunction with Mr. Levinsohn’s services relating to the Company’s entry into the Licensing Agreement, to acquire 2,000,000 shares of the Company’s common stock under the Company’s 2019 Plan. These stock options vest monthly over three years, with one-third vesting after 12 months of continuous service from the grant date and a further 1/36 vesting at the end of each month of continuous service thereafter, exercisable for a period of ten years at $0.42 per share (the closing market price on June 11, 2019), and were not exercisable until the Company increased its authorized shares of common stock to a sufficient number to permit the full exercise of the stock options granted; accordingly, these stock option grants were considered unfunded and were not permitted to be exercised until sufficient common shares were authorized (further details are provided under the heading Sequencing Policy On September 16, 2019, Mr. Levinsohn was granted a stock options, in conjunction with Mr. Levinsohn’s services relating to the Company’s entry into the Licensing Agreement, to acquire 2,000,000 shares of the Company’s common stock under the Company’s 2019 Plan. These stock options vest monthly over three years, with one-third vesting after 12 months of continuous service from the grant date and the remaining two-thirds over next 24 months subject to meeting certain revenue targets, exercisable for a period of ten years, $0.78 per share (the closing market price on September 16, 2019), and were not exercisable until the Company increased its authorized shares of common stock to a sufficient number to permit the full exercise of the stock options granted; accordingly, these stock option grants were considered unfunded and were not permitted to be exercised until sufficient common shares were authorized (further details are provided under the heading Sequencing Policy Mr. Levinsohn purchased $500,000 of the Company’s newly designated Series I Convertible Preferred Stock. On August 26, 2020 Mr. Levinsohn became Chief Executive Officer of the Company. 12% Amended Senior Secured Notes On June 14, 2019, the Company entered into an amended and restated note purchase agreement with one accredited investor, BRF Finance Co., LLC, an affiliated entity of B. Riley, which amended and restated the 12% senior secured note dated June 10, 2019, by and among the Company and the investor. Pursuant to this amendment, the Company issued an amended and restated 12% senior secured note, due June 14, 2022, in the aggregate principal amount of $68,000,000, which amends, restates and supersedes that $20,000,000 12% senior secured note issued by the Company on June 10, 2019 to the investor. The Company received additional gross proceeds of $48,000,000, which after taking into account B. Riley’s placement fee of $2,400,000 and legal fees and expenses of the investor, the Company received net proceeds of $45,550,000, of which $45,000,000 was paid to ABG against future Royalties in connection with the Company’s Licensing Agreement, dated June 14, 2019, with ABG, and the balance of $550,000 to be used by the Company for working capital and general corporate purposes. On August 27, 2019, the Company entered into a first amendment to the amended note purchase agreement with one accredited investor, BRF Finance Co., LLC, an affiliated entity of B. Riley, which amended the amended and restated 12% senior secured note dated June 14, 2019. Pursuant to this first amendment, the Company received gross proceeds of $3,000,000, which after taking into account a closing fee paid to the investor of $150,000 and legal fees and expenses of the investor, the Company received net proceeds of approximately $2,830,000, which will be used by the Company for working capital and general corporate purposes. On February 27, 2020, the Company entered into a second amendment to amended and restated note purchase agreement with one accredited investor, BRF Finance Co., LLC, an affiliated entity of B. Riley, which amended the first amendment to the amended and restated 12% senior secured note dated August 27, 2019. Pursuant to the second amendment, the Company is (i) allowed to replace our previous $3.5 million working capital facility with a new $15.0 million working capital facility; and (ii) permitted to account for the issuance by the investor of a $3.0 million letter of credit to the Company’s landlord for the Company’s lease of the premises located at 225 Liberty Street, 27th Floor, New York, New York 10281. The balance outstanding under the amended and restated 12% senior secured notes as of the issuance date of these consolidated financial statements was $56,296,090, which included payment-in-kind interest of $7,457,388 (further details on Amendment 1 are provided under the heading Delayed Draw Term Note Series J Preferred Stock Warrant Exercise On September 10, 2019, the L2 Warrants were fully exercised on a cashless basis for the issuance of 539,331 shares of the Company’s common stock. Series H Preferred Stock Between August 14, 2020 and August 20, 2020, the Company entered into additional securities purchase agreement for the sale of Series H Preferred Stock with accredited investors, pursuant to which the Company issued an aggregate of 2,253 shares, at a stated value of $1,000 per share, initially convertible into 6,825,000 shares of the Company’s common stock at a conversion rate equal to the stated value divided by the conversion price of $0.33 per share, for aggregate gross proceeds of $2,730,000 for working capital and general corporate purposes. The number of shares issuable upon conversion of the Series H Preferred Stock will be adjusted in the event of stock splits, stock dividends, combinations of shares and similar transactions. Each Series H Preferred Stock shall vote on an as-if-converted to common stock basis, subject to beneficial ownership blocker provisions and other certain conditions. The shares of Series H Preferred Stock are subject to limitations on conversion into shares of the Company’s common stock until the date an amendment to the Company’s certificate of incorporation is filed and accepted with the State of Delaware that increases the number of authorized shares of its common stock to at least a number permitting all the Series H Preferred Stock to be converted in full (further details are provided under the heading Sequencing Policy The securities purchase agreements also included a provision that requires the Company to maintain its periodic filings with the SEC in order to satisfy the public information requirements under Rule 144(c) of the Securities Act. If the Company fails for any reason to satisfy the current public information requirement commencing from the six (6) month anniversary date of issuance of the Series H Preferred Shares, then the Company will be obligated to pay Public Information Failure Damages (as further described in Note 11) to each holder, consisting of a cash payment equal to 1% of the amount invested as partial liquidated damages, up to a maximum of six months, subject to interest at the rate of 1% per month until paid in full. Series I Preferred Stock On June 27, 2019, 25,800 authorized shares of the Company’s preferred stock were designated as “Series I Convertible Preferred Stock” (the “Series I Preferred Stock”). On June 28, 2019, the Company closed on a securities purchase agreement with certain accredited investors, pursuant to which the Company issued an aggregate of 23,100 shares of Series I Preferred Stock at a stated value of $1,000, initially convertible into 46,200,000 shares of the Company’s common stock at a conversion rate equal to the stated value divided by the conversion price of $0.50 per share, for aggregate gross proceeds of $23,100,000. The number of shares issuable upon conversion of the Series I Preferred Stock will be adjusted in the event of stock splits, stock dividends, combinations of shares and similar transactions. Each Series I Preferred Stock shall vote on an as-if-converted to common stock basis, subject to certain conditions. In consideration for its services as placement agent, the Company paid B. Riley FBR a cash fee of $1,386,000 plus $52,500 in reimbursement of legal fees and other transaction costs. The Company used approximately $18.3 million of the net proceeds from the financing to partially repay the amended and restated 12% senior secured note dated June 14, 2019, and to pay deferred fees of approximately $3.4 million related to that borrowing facility. All of the shares of Series I Preferred Stock convert automatically into shares of the Company’s common stock on the date an amendment to the Company’s certificate of incorporation is filed and accepted with the State of Delaware that increases the number of authorized shares of its common stock to at least a number permitting all the Series I Preferred Stock, and all of the Series H Preferred Stock, to be converted in full (further details are provided under the heading Sequencing Policy Pursuant to the registration rights agreements entered into in connection with the securities purchase agreements on June 28, 2019, the Company agreed to register the shares issuable upon conversion of the Series I Preferred Stock for resale by the investors. The Company committed to file the registration statement no later than the 30th calendar day following the date the Company files (i) its Annual Report on Form 10-K for the fiscal year ended December 31, 2018, (ii) all its required quarterly reports on Form 10-Q since the quarter ended September 30, 2018 through September 30, 2019, and (iii) current Form 8-K in connection with the acquisitions of TheStreet and its license with ABG, with the SEC, but in no event later than December 1, 2019. The Company committed to cause the registration statement to become effective by no later than 90 days after December 1, 2019, subject to certain conditions. The registration rights agreements provide for Registration Rights Damages upon the occurrence of certain events up to a maximum amount of 6% of the aggregate amount invested (further details are provided under the heading Liquidating Damages The securities purchase agreements also included a provision that requires the Company to maintain its periodic filings with the SEC in order to satisfy the public information requirements under Rule 144(c) of the Securities Act. If the Company fails for any reason to satisfy the current public information requirement commencing from the six (6) month anniversary date of issuance of the Series I Preferred Shares, then the Company will be obligated to pay Public Information Failure Damages to each holder, consisting of a cash payment equal to 1% of the amount invested as partial liquidated damages, up to a maximum of six months, subject to interest at the rate of 1% per month until paid in full (further details are provided under the heading Liquidating Damages Series J Preferred Stock On October 4, 2019, 35,000 authorized shares of the Company’s preferred stock were designated as “Series J Convertible Preferred Stock” (the “Series J Preferred Stock”). On October 7, 2019, the Company closed on a securities purchase agreement with certain accredited investors, pursuant to which the Company issued an aggregate of 20,000 shares of Series J Preferred Stock at a stated value of $1,000, initially convertible into 28,571,428 shares of the Company’s common stock at a conversion rate equal to the stated value divided by th |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and include the financial statements of Maven and its wholly-owned subsidiaries, Coalition, and HubPages, Inc. (“HubPages”) a new wholly-owned subsidiary formed on March 13, 2018 and Say Media, Inc. (“Say Media”) a new wholly-owned subsidiary formed on September 6, 2018 to facilitate the acquisition transactions described in Note 3. Intercompany balances and transactions have been eliminated in consolidation. |
Foreign Currency | Foreign Currency The functional currency of the Company’s foreign subsidiaries is the local currencies (U.K. pounds sterling and Canadian dollar), as it is the monetary unit of account of the principal economic environment in which the Company’s foreign subsidiaries operate. All assets and liabilities of the foreign subsidiaries are translated at the current exchange rate as of the end of the period, and revenue and expenses are translated at average exchange rates in effect during the period. The gain or loss resulting from the process of translating foreign currencies financial statements into U.S. dollars was immaterial for the year ended December 31, 2018, therefore, a foreign currency cumulative translation adjustment was not reported as a component of accumulated other comprehensive income (loss) and the unrealized foreign exchange gain or loss was omitted from the consolidated statements of cash flows. Foreign currency transaction gains and losses, if any, resulting from or expected to result from transactions denominated in a currency other than the functional currency are recognized in other income, net on the consolidated statements of operations. |
Use of Estimates | Use of Estimates The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include those related to the selection of useful lives of property and equipment, intangible assets, capitalization of platform development and associated useful lives; assumptions used in accruals for potential liabilities; fair value of assets acquired and liabilities assumed in the business acquisitions, the fair value of the Company’s goodwill and the assessment of acquired goodwill, other intangible assets and long-lived assets for impairment; determination of the fair value of stock based compensation and valuation of derivatives liabilities; and the assumptions used to calculate contingent liabilities, and realization of deferred tax assets. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, and makes adjustments when facts and circumstances dictate. Actual results could differ from these estimates. |
Risks and Uncertainties | Risks and Uncertainties The Company has a limited operating history and has not generated significant revenues to date. The Company’s business and operations are sensitive to general business and economic conditions in the U.S. and worldwide. These conditions include short-term and long-term interest rates, inflation, fluctuations in debt and equity capital markets and the general condition of the U.S. and world economy. A host of factors beyond the Company’s control could cause fluctuations in these conditions. Adverse developments in these general business and economic conditions could have a material adverse effect on the Company’s financial condition and the results of its operations. In addition, the Company will compete with many companies that currently have extensive and well-funded projects, marketing and sales operations as well as extensive human capital. The Company may be unable to compete successfully against these companies. The Company’s industry is characterized by rapid changes in technology and market demands. As a result, the Company’s products, services, and/or expertise may become obsolete and/or unmarketable. The Company’s future success will depend on its ability to adapt to technological advances, anticipate customer and market demands, and enhance its current technology under development. With the initial onset of COVID-19, the Company faced significant change in its advertisers buying behavior, where previous ad placements were canceled. The Company’s advertising revenue from Sports Illustrated was impacted as a result of sports authorities around the world making the decision to postpone/cancel high attendance sports events in an effort to reduce the spread of the COVID-19 virus. Since May 2020, there has been a steady recovery in the advertising market in both pricing and volume, which coupled with the return of professional and college sports yielded steady growth in revenues through the balance of 2020. The Company expects a continued modest growth in advertising revenue back toward pre-pandemic levels. As a result of the Company’s advertising revenue declining in early 2020, the Company is vulnerable to a risk of loss in the near term and it is at least reasonably possible that events or circumstances may occur that could cause a significant impact in the near term, that depend on future developments, including the duration of COVID-19, future sport event advisories and restrictions, and the extent and effectiveness of containment actions taken. Since August 2018, B. Riley FBR, Inc. (“B. Riley FBR”), a registered broker-dealer owned by B. Riley Financial, Inc., a diversified publicly-traded financial services company (“B. Riley”), has been instrumental in providing investment banking services to the Company and in raising debt and equity capital for the Company. These services have included raising debt and equity capital to support: (i) the acquisitions of HubPages and Say Media (as described in Note 3); (ii) working capital financings with the sale of the 10% Convertible Debentures, 10% OID Convertible Debentures, and 12% Convertible Debentures (as described in Note 13); (iii) the Series H Preferred Stock financing (as described in Note 16); (iv) the sale of the 12% Senior Secured Notes and 12% Amended Senior Secured Notes (as described in Note 24); (v) subsequent acquisition of TheStreet, Inc. and licensing agreement with ABG-SI LLC (as described in Note 24); and (vi) subsequent equity capital for the sale of the Series H Preferred Stock, and sale of the Series I, J and K Preferred Stock (as described in Note 24). |
Revenue Recognition | Revenue Recognition The Company adopted Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers Revenue Recognition Revenues are recognized when control of the promised goods or services are transferred to the Company’s customers, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services. The Company generates all of its revenue from contracts with customers. The Company accounts for revenue on a gross basis, as compared to a net basis, in its statement of operations. Cost of revenues is presented as a separate line item in the statement of operations. The Company has made this determination based on it taking the credit risk in its revenue-generating transactions and it also being the primary obligor responsible for providing the services to the customer. The following is a description of the principal activities from which the Company generates revenue: Advertising Membership Subscriptions |
Disaggregation of Revenue | Disaggregation of Revenue The following table provides information about disaggregated revenue by product line, geographical market and timing of revenue recognition: Years Ended December 31, 2018 2017 Revenue by product line: Advertising $ 5,614,953 $ 62,777 Membership subscriptions 85,246 14,218 Total $ 5,700,199 $ 76,995 Revenue by geographical market: United States $ 5,700,199 $ 76,995 Other - - Total $ 5,700,199 $ 76,995 Revenue by timing of recognition: At point in time $ 5,614,953 $ 62,777 Over time 85,246 14,218 Total $ 5,700,199 $ 76,995 |
Cost of Revenue | Cost of Revenue Cost of revenue represents the cost of providing the Company’s digital media network channels and advertising and membership services. The cost of revenue that the Company has incurred in the periods presented primarily include: channel partner guarantees and revenue share payments; amortization of developed technology and platform development; hosting and bandwidth and software license fees; stock based compensation related to Channel Partner Warrants (as described below); programmatic advertising platform costs; payroll and related expenses of related personnel; fees paid for data analytics and to other outside service providers, and stock based compensation of related personnel. |
Contract Balances | Contract Balances The following table provides information about contract balances: As of December 31, 2018 As of December 31, 2017 Advertising Memberships Total Advertising Memberships Total Factor receivables $ 6,130,674 $ - $ 6,130,674 $ 52,348 $ 854 $ 53,202 Short-term contract assets (contract fulfillment costs) - 17,056 17,056 - 14,147 14,147 Short-term contract liabilities 325,863 70,544 396,407 - 31,437 31,437 Long-term contract liabilities 252,500 - 252,500 - - - The Company receives payments from advertising customers based upon contractual payment terms; accounts receivable are recorded when the right to consideration becomes unconditional and are generally collected within 90 days. The Company generally receives payments from membership subscription customers at the time of sign up for each subscription; accounts receivable from merchant credit card processors are recorded when the right to consideration becomes unconditional and are generally collected weekly. Contract assets include contract fulfillment costs related to the revenue share to the Channel Partners, which are amortized to expense over the same period of the associated revenue. Contract liabilities include payments received in advance of performance under the contract and are recognized as revenue over time. The Company had no asset impairment charges related to contract assets during the years ended December 31, 2018 and 2017. |
Cash, Cash Equivalents, and Restricted Cash | Cash, Cash Equivalents, and Restricted Cash Cash, Cash Equivalents, and Restricted Cash As of December 31, 2018 2017 Cash and cash equivalents $ 2,406,596 $ 619,249 Restricted cash 120,693 3,000,000 Total cash, cash equivalents, and restricted cash $ 2,527,289 $ 3,619,249 In January 2018, the Company raised pursuant to a private placement $3,000,000. The $3,000,000 was received by the Company prior to December 31, 2017 and was classified as restricted cash in the December 31, 2017 balance sheet and then subsequently reclassified to cash in January 2018 upon completion of the private placement. In addition, the $3,000,000 investment was classified as investor demand payable in the December 31, 2017 balance sheet and then subsequently reclassified to equity in January 2018 upon completion of the private placement. |
Concentrations | Concentrations Significant Customers Revenue from significant customers as a percentage of the Company’s total revenue are as follows: Years Ended December 31, 2018 2017 Customer 1 35.5 % - Customer 2 14.8 % - Significant accounts receivable balances as a percentage of the Company’s total accounts receivable are as follows: As of December 31, 2018 2017 Customer 1 16.8 % - Customer 2 - - Significant Vendors Significant accounts payable balances as a percentage of the Company’s total accounts payable are as follows: As of December 31, 2018 2017 Vendor 1 29.4 % - Vendor 2 11.5 % - |
Property and Equipment | Property and Equipment Property and equipment is stated at cost less accumulated depreciation and amortization. Major improvements are capitalized, while maintenance and repairs are charged to expense as incurred. Gains and losses from disposition of property and equipment are included in the statement of operations when realized. Depreciation and amortization are provided using the straight-line method over the following estimated useful lives: Office equipment and computers 3 years Furniture and fixtures 3 – 5 years |
Platform Development | Platform Development In accordance with authoritative guidance, the Company capitalizes platform development costs for internal use when planning and design efforts are successfully completed, and development is ready to commence. The Company places capitalized platform development assets into service and commences amortization when the applicable project or asset is substantially complete and ready for its intended use. Once placed into service, the Company capitalizes qualifying costs of specified upgrades or enhancements to capitalized platform development assets when the upgrade or enhancement will result in new or additional functionality. The Company capitalizes internal labor costs, including payroll-based and stock based compensation, benefits and payroll taxes, that are incurred for certain capitalized platform development projects related to the Company’s technology platform. The Company’s policy with respect to capitalized internal labor stipulates that labor costs for employees working on eligible internal use capital projects are capitalized as part of the historical cost of the project when the impact, as compared to expensing such labor costs, is material. Platform development costs are amortized on a straight-line basis over three years, which is the estimated useful life of the related asset and is recorded in cost of revenues on the consolidated statements of operations. |
Business Combinations | Business Combinations The Company accounts for business combinations using the acquisition method of accounting. The acquisition method of accounting requires that the purchase price, including the fair value of contingent consideration, of the acquisition be allocated to the assets acquired and liabilities assumed using the estimated fair values determined by management as of the acquisition date. Goodwill is measured as the excess of consideration transferred and the net fair values of the assets acquired and the liabilities assumed at the date of acquisition. While the Company uses its best estimates and assumptions as part of the purchase price allocation process to accurately value assets acquired and liabilities assumed at the acquisition date, the Company’s estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, the Company records adjustments to the assets acquired and liabilities assumed, with the corresponding offset to goodwill to the extent the Company identifies adjustments to the preliminary purchase price allocation. Upon the conclusion of the measurement period, which may be up to one year from the acquisition date, or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to the consolidated statements of operations. Additionally, the Company identifies acquisition-related contingent payments and determines their respective fair values as of the acquisition date, which are recorded as accrued liabilities on the consolidated balance sheets. Subsequent changes in fair value of contingent payments are recorded on the consolidated statements of operations. The Company expenses transaction costs related to the acquisition as incurred. |
Intangible Assets | Intangible Assets Intangibles with finite lives, consisting of developed technology and trade names, are amortized using the straight-line method over the estimated economic lives of the assets, which is five years. A finite lived intangible asset is tested for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. Determination of recoverability is based on an estimate of undiscounted future cash flows resulting from the use of the asset and its eventual disposition. Trade name consists of trade names in affiliation with HubPages and Say Media. Intangibles with an indefinite useful life are not being amortized. |
Long-Lived Assets | Long-Lived Assets The Company periodically evaluates the carrying value of long-lived assets to be held and used when events or circumstances warrant such a review. The carrying value of a long-lived asset to be held and used is considered impaired when the anticipated separately identifiable undiscounted cash flows from such an asset are less than the carrying value of the asset. In that event, a loss is recognized based on the amount by which the carrying value exceeds the fair value of the long-lived asset. Fair value is determined primarily by reference to the anticipated cash flows discounted at a rate commensurate with the risk involved. No impairment charges have been recorded in the periods presented. |
Goodwill | Goodwill Goodwill represents the excess of the purchase price over the fair value of the net tangible and intangible assets of businesses acquired in a business combination. Goodwill is not amortized but rather is tested for impairment at least annually on December 31, or more frequently if events or changes in circumstances indicate that the carrying amount of goodwill may not be recoverable. The Company has elected to first assess the qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis of determining whether it is necessary to perform the quantitative goodwill impairment test. If the Company determines that it is more likely than not that its fair value is less than its carrying amount, then the quantitative goodwill impairment test will be performed. The quantitative goodwill impairment test identifies goodwill impairment and measures the amount of goodwill impairment loss to be recognized by comparing the fair value of a reporting unit with its carrying amount. If the fair value exceeds the carrying amount, no further analysis is required; otherwise, any excess of the goodwill carrying amount over the implied fair value is recognized as an impairment loss, and the carrying value of goodwill is written down to fair value. |
Deferred Financing Costs and Discounts on Debt Obligations | Deferred Financing Costs and Discounts on Debt Obligations Deferred financing costs consist of cash and noncash consideration paid to lenders and third parties with respect to convertible debt financing transactions, including legal fees and placement agent fees. Such costs are deferred and amortized over the term of the related debt. Upon the settlement or conversion of convertible debt into common stock, the pro rata portion of any related unamortized deferred financing costs are charged to operations. Additional consideration in the form of warrants and other derivative financial instruments issued to lenders is accounted for at fair value utilizing information determined by consultants with the Company’s independent valuation firm. The fair value of warrants and derivatives is recorded as a reduction to the carrying amount of the related debt and is being amortized to interest expense over the term of such debt, with the initial offsetting entries recorded as a liability on the balance sheet. Upon the settlement or conversion of convertible debt into common stock, the pro rata portion of any related unamortized discount on debt is charged to operations. Amortization of debt discount during the years ended December 31, 2018 and 2017, was $601,840 and none, respectively. |
Liquidated Damages | Liquidated Damages Obligations with respect to Registration Rights Damages (as described below) and Public Information Failure Damages (as described below) (collectively the “Liquidated Damages” or in the context of subsequent events in Note 24 the “Liquidating Damages”) accounted for as contingent obligations when it is deemed probable the obligations would not be satisfied at the time a financing is completed, and are subsequently reviewed at each quarter-end reporting date thereafter. When such quarterly review indicates that it is probable that the Liquidated Damages will be incurred, the Company records an estimate of each such obligation at the balance sheet date based on the amount due of such obligation. The Company reviews and revises such estimates at each quarter-end date based on updated information. |
Research and Development | Research and Development Research and development costs are charged to operations in the period incurred. Research and development costs consist primarily of expenses incurred in the research and development of the Company’s technology platform in the preliminary project and post-implementation stages which include payroll and related expenses for personnel; costs incurred in developing conceptual formulation and determination of existence of needed technology; and stock based compensation of related personnel. |
General and Administrative | General and Administrative General and administrative expenses consist primarily of payroll and related expenses for executive, sales, and administrative personnel; professional services, including accounting, legal and insurance; depreciation of office equipment, computers, and furniture and fixtures; facilities costs; conferences; other general corporate expenses; and stock based compensation of related personnel. Cost associated with the Company’s advertising are expensed as incurred and included within general and administrative expenses. During the years ended December 31, 2018 and 2017, the Company incurred advertising costs of $25,285 and $1,743, respectively, which comprised print, and digital advertising. |
Derivative Financial Instruments | Derivative Financial Instruments The Company accounts for freestanding contracts that are settled in a company’s own stock, including common stock warrants, to be designated as an equity instrument, generally as a liability. A contract so designated is carried at fair value on a company’s balance sheet, with any changes in fair value recorded as a gain or loss in a company’s results of operations. The Company records all derivatives on the balance sheet at fair value, adjusted at the end of each reporting period to reflect any material changes in fair value, with any such changes classified as changes in derivatives valuation in the statement of operations. The calculation of the fair value of derivatives utilizes highly subjective and theoretical assumptions that can materially affect fair values from period to period. The recognition of these derivative amounts does not have any impact on cash flows. At the date of exercise of any of the warrants, or the conversion of any convertible debt or preferred stock into common stock, the fair value of the related warrant liability and any embedded derivative liability is transferred to additional paid-in capital. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The authoritative guidance with respect to fair value established a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels and requires that assets and liabilities carried at fair value be classified and disclosed in one of three categories, as presented below. Disclosure as to transfers in and out of Levels 1 and 2, and activity in Level 3 fair value measurements, is also required. Level 1. Observable inputs such as quoted prices in active markets for an identical asset or liability that the Company has the ability to access as of the measurement date. Financial assets and liabilities utilizing Level 1 inputs include active-exchange traded securities and exchange-based derivatives. Level 2. Inputs, other than quoted prices included within Level 1, which are directly observable for the asset or liability or indirectly observable through corroboration with observable market data. Financial assets and liabilities utilizing Level 2 inputs include fixed income securities, non-exchange-based derivatives, mutual funds, and fair-value hedges. Level 3. Unobservable inputs in which there is little or no market data for the asset or liability which requires the reporting entity to develop its own assumptions. Financial assets and liabilities utilizing Level 3 inputs include infrequently traded non-exchange-based derivatives and commingled investment funds and are measured using present value pricing models. The Company determines the level in the fair value hierarchy within which each fair value measurement falls in its entirety, based on the lowest level input that is significant to the fair value measurement in its entirety. In determining the appropriate levels, the Company performs an analysis of the assets and liabilities at each reporting period end. The carrying amount of the Company’s financial instruments comprising of cash, restricted cash, accounts receivable, accounts payable and accrued expenses approximate fair value because of the short-term maturity of these instruments. |
Preferred Stock | Preferred Stock Preferred stock (the “Preferred Stock”) (as described in Note 16) is reported as a mezzanine obligation between liabilities and stockholders’ equity. If it becomes probable that the Preferred Stock will become redeemable, the Company will re-measure the Preferred Stock by adjusting the carrying value to the redemption value of the Preferred Stock assuming each balance sheet date is a redemption date. |
Stock Based Compensation | Stock Based Compensation The Company provides stock based compensation in the form of (a) restricted stock awards to employees and directors, (b) stock option grants to employees, directors and consultants, and (c) common stock warrants to Channel Partners (refer to Channel Partner Warrants below). The Company accounts for restricted stock awards and stock option grants to employees, directors and consultants by measuring the cost of services received in exchange for the stock based payments as compensation expense in the Company’s consolidated financial statements. Restricted stock awards and stock option grants to employees which are time-vested are measured at fair value on the grant date and charged to operations ratably over the vesting period. Restricted stock awards and stock option grants to employees which are performance-vested are measured at fair value on the grant date and charged to operations when the performance condition is satisfied. The Company accounts for stock based payments to certain directors and consultants and its Channel Partners by determining the value of the stock compensation based upon the measurement date at either (a) the date at which a performance commitment is reached or (b) at the date at which the necessary performance to earn the equity instruments is complete. The fair value of restricted stock awards which are time-vested is determined using the quoted market price of the Company’s common stock at the grant date. The fair value of restricted stock awards which provide for performance-vesting and a true-up provision (as described in Note 17) is determined through consultants with the Company’s independent valuation firm using the binomial pricing model at the grant date. The fair value of stock options granted and Channel Partner warrants granted as stock based payments are determined utilizing the Black-Scholes option-pricing model which is affected by several variables, the most significant of which are the life of the equity award, the exercise price of the stock option or warrants, as compared to the fair market value of the common stock on the grant date, and the estimated volatility of the common stock over the term of the equity award. Estimated volatility is based on the historical volatility of the Company’s common stock and is evaluated based upon market comparisons. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. The fair market value of common stock is determined by reference to the quoted market price of the Company’s common stock. The Company classifies stock based compensation expense in its consolidated statements of operations in the same manner in which the award recipient’s cash compensation costs are classified. |
Channel Partner Warrants | Channel Partner Warrants On December 19, 2016, the Company’s Board approved up to 5,000,000 stock warrants to issue shares of the Company’s common stock to provide equity incentive to its Channel Partners (the “Channel Partner Warrants”) to motivate and reward them for their services to the Company and to align the interests of the Channel Partners with those of stockholders of the Company. On August 23, 2018, the Board approved a reduction of the number of warrant reserve shares from 5,000,000 to 2,000,000. The issuance of the Channel Partner Warrants is administered by management and approved by the Board. The Channel Partner Warrants granted are subject to a performance condition which is generally based on the average number of unique visitors on the channel operated by the Channel Partner generated during the six-month period from the launch of the Channel Partner’s operations on Maven’s platform or the revenue generated during the period from issuance date through a specified end date. The Company recognizes expense for these equity-based payments as the services are received. The Company has specific objective criteria for determination of the period over which services are received and expense is recognized. |
Income Taxes | Income Taxes The Company accounts for income taxes under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to operating loss carryforwards and temporary differences between financial statement bases of existing assets and liabilities and their respective income tax bases. Deferred tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect of a change in the income tax rates on deferred tax asset and liability balances is recognized in income in the period that includes the enactment date of such rate change. A valuation allowance is recorded for loss carryforwards and other deferred tax assets when it is determined that it is more likely than not that such loss carryforwards and deferred tax assets will not be realized. The Company follows accounting guidance that sets forth a threshold for financial statement recognition, measurement, and disclosure of a tax position taken or expected to be taken on a tax return. Such guidance requires the Company to determine whether a tax position of the Company is more likely than not to be sustained upon examination by the applicable taxing authority, including resolution of any related appeals or litigation processes, based on technical merits of the position. |
Income (Loss) Per Common Share | Income (Loss) per Common Share Basic income or loss per share is computed using the weighted average number of common shares outstanding during the period and excludes any dilutive effects of common stock equivalent shares, such as stock options, restricted stock, and warrants. All restricted stock is considered outstanding but is included in the computation of basic income (loss) per common share only when the underlying restrictions expire, the shares are no longer forfeitable, and are thus vested. Contingently issuable shares are included in basic income (loss) per common share only when there are no circumstance under which those shares would not be issued. Diluted income per common share is computed using the weighted average number of common shares outstanding and common stock equivalent shares outstanding during the period using the treasury stock method. Common stock equivalent shares are excluded from the computation if their effect is anti-dilutive. The Company excluded the outstanding securities summarized below (capitalized terms are described herein), which entitle the holders thereof to acquire shares of common stock, from its calculation of net income (loss) per common share, as their effect would have been anti-dilutive. As of December 31, 2018 2017 Series G Preferred Stock 188,791 98,698 Series H Preferred Stock 58,787,879 - Indemnity shares of common stock 825,000 - Unvested and forfeitable restricted stock awards 6,309,876 6,979,596 Financing Warrants 3,949,018 1,289,172 Channel Partner Warrants 1,017,141 1,303,832 Common stock options: 2016 Plan 9,405,541 2,176,637 Outside Options 2,414,000 Total 82,897,246 11,847,935 |
Adoption of Sequencing Policy | Adoption of Sequencing Policy Under authoritative guidance, the Company adopted a sequencing policy whereby, in the event that reclassification of contracts from equity to assets or liabilities is necessary pursuant to ASC 815 due to the Company’s inability to demonstrate it has sufficient authorized shares, shares will be allocated on the basis of the earliest issuance date of potentially dilutive instruments, with the earliest grants receiving the first allocation of shares. Pursuant to ASC 815, issuance of securities to the Company’s employees or directors are not subject to the sequencing policy. Information with respect to the issuance of dilutive and potentially dilutive instruments and authorized share increase subsequent to the date of these consolidated financial statements are provided in Note 24 under the heading Sequencing Policy |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Recently Adopted Accounting Standards In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers (Topic 606) In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230) Recently Issued Accounting Standards In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) In June 2016, the FASB ASU 2016-13, Financial Instruments – Credit Losses (Topic 326) In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment In July 2017, the FASB issued ASU 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features; (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception In June 2018, the FASB issued ASU 2018-07, Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting 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) In October 2020, the FASB issued ASU 2020-08, Codification Improvements to Subtopic 310-20 – Receivables – Nonrefundable Fees and Other Costs In October 2020, the FASB issued ASU 2020-10, Codification Improvements Management does not believe that any other recently issued, but not yet effective, authoritative guidance, if currently adopted, would have a material impact on the Company’s financial statement presentation or disclosures. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Schedule of Disaggregation of Revenue | The following table provides information about disaggregated revenue by product line, geographical market and timing of revenue recognition: Years Ended December 31, 2018 2017 Revenue by product line: Advertising $ 5,614,953 $ 62,777 Membership subscriptions 85,246 14,218 Total $ 5,700,199 $ 76,995 Revenue by geographical market: United States $ 5,700,199 $ 76,995 Other - - Total $ 5,700,199 $ 76,995 Revenue by timing of recognition: At point in time $ 5,614,953 $ 62,777 Over time 85,246 14,218 Total $ 5,700,199 $ 76,995 |
Schedule of Contract with Customer, Asset and Liability | The following table provides information about contract balances: As of December 31, 2018 As of December 31, 2017 Advertising Memberships Total Advertising Memberships Total Factor receivables $ 6,130,674 $ - $ 6,130,674 $ 52,348 $ 854 $ 53,202 Short-term contract assets (contract fulfillment costs) - 17,056 17,056 - 14,147 14,147 Short-term contract liabilities 325,863 70,544 396,407 - 31,437 31,437 Long-term contract liabilities 252,500 - 252,500 - - - |
Schedule of Cash and Restricted Cash | The following table reconciles total cash, cash equivalents, and restricted cash: As of December 31, 2018 2017 Cash and cash equivalents $ 2,406,596 $ 619,249 Restricted cash 120,693 3,000,000 Total cash, cash equivalents, and restricted cash $ 2,527,289 $ 3,619,249 |
Schedule of Concentration of Credit Risk | Revenue from significant customers as a percentage of the Company’s total revenue are as follows: Years Ended December 31, 2018 2017 Customer 1 35.5 % - Customer 2 14.8 % - Significant accounts receivable balances as a percentage of the Company’s total accounts receivable are as follows: As of December 31, 2018 2017 Customer 1 16.8 % - Customer 2 - - Significant Vendors Significant accounts payable balances as a percentage of the Company’s total accounts payable are as follows: As of December 31, 2018 2017 Vendor 1 29.4 % - Vendor 2 11.5 % - |
Schedule of Depreciation and Amortization, Useful Lives of Assets | Depreciation and amortization are provided using the straight-line method over the following estimated useful lives: Office equipment and computers 3 years Furniture and fixtures 3 – 5 years |
Schedule of Net Income (loss) Per Common Share | The Company excluded the outstanding securities summarized below (capitalized terms are described herein), which entitle the holders thereof to acquire shares of common stock, from its calculation of net income (loss) per common share, as their effect would have been anti-dilutive. As of December 31, 2018 2017 Series G Preferred Stock 188,791 98,698 Series H Preferred Stock 58,787,879 - Indemnity shares of common stock 825,000 - Unvested and forfeitable restricted stock awards 6,309,876 6,979,596 Financing Warrants 3,949,018 1,289,172 Channel Partner Warrants 1,017,141 1,303,832 Common stock options: 2016 Plan 9,405,541 2,176,637 Outside Options 2,414,000 Total 82,897,246 11,847,935 |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Business Combinations [Abstract] | |
Summary of Price Allocation for Acquisition | The purchase price allocation resulted in the following amounts being allocated to the assets acquired and liabilities assumed at the closing date of the acquisition based upon their respective fair values as summarized below: Cash $ 1,537,308 Current assets 50,788 Accounts receivable and unbilled receivables 1,033,080 Other assets 25,812 Developed technology 6,740,000 Trade name 268,000 Goodwill 1,857,663 Current liabilities (851,114 ) Deferred tax liability (91,633 ) Net assets acquired $ 10,569,904 |
Schedule of Shares Issued for Post Combination Services | The shares issued are for post combination services. The composition of the purchase price is as follows: Cash $ 9,537,397 Issued shares of common stock 1,636,251 Indemnity shares of common stock 288,750 Net settlement of preexisting relationship 552,314 Noncompete agreement 242,310 Total purchase consideration $ 12,257,022 |
Summary of Price Allocation for Assets Acquired and Liabilities | The purchase price allocation resulted in the following amounts being allocated to the assets acquired and liabilities assumed at the closing date of the acquisition based upon their respective fair values as summarized below: Cash $ 534,637 Accounts receivable and unbilled receivables 4,624,455 Prepaid expenses 172,648 Note receivable 41,638 Fixed assets 11,392 Other assets 65,333 Developed technology 8,010,000 Trade name 480,000 Noncompete agreement 480,000 Goodwill 5,466,624 Accounts payable (3,618,112 ) Accrued expenses (1,470,749 ) Contract liabilities (513,336 ) Other liabilities (2,027,508 ) Net assets acquired $ 12,257,022 |
Schedule of Pro-forma Information for Acquisition | The following table summarizes the results of operations of the above mentioned transactions from their respective dates of acquisition included in the consolidated results of operations and the unaudited pro forma results of operations of the combined entity had the date of the acquisitions been January 1, 2017: Revenue Net Income (Loss) Acquired entities only from acquisition date until December 31, 2018: HubPages $ 2,996,700 $ 471,640 Say Media 1,398,690 75,661 Total acquired entities only from acquisition date until December 31, 2018 $ 4,395,390 $ 547,301 Combined entity supplemental pro forma from January 1, 2018 to December 31, 2018 (unaudited): HubPages $ 7,537,166 $ 951,836 Say Media 15,210,464 3,365,989 Maven 1,304,809 (26,615,184 ) Adjustments (1,376,478 ) (5,774,681 ) Total supplemental pro forma from January 1, 2018 to December 31, 2018 $ 22,675,961 $ (28,072,040 ) Combined entity supplemental pro forma from January 1, 2017 to December 31, 2017 (unaudited): HubPages $ 4,904,759 $ 575,963 Say Media 12,608,398 20,829,482 Maven 76,995 (6,284,313 ) Adjustments - (8,344,013 ) Total supplemental pro forma from January 1, 2017 to December 31, 2017 $ 17,590,152 $ 6,777,119 The following summarizes earnings per common share of the combined entity had the date of the acquisitions been January 1, 2017: Supplemental Pro Forma from January 1, 2018 to December 31, 2018 (unaudited) Supplemental Pro Forma from January 1, 2017 to December 31, 2017 (unaudited) Net income (loss) $ (28,072,040 ) $ 6,777,119 Net income (loss) per common share – basic and diluted $ (0.81 ) $ 0.33 Weighted average number of common shares outstanding – basic and diluted 34,444,608 20,849,067 |
Prepayments and Other Current_2
Prepayments and Other Current Assets (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Prepayments And Other Current Assets | |
Schedule of Prepayments and Other Current Assets | Prepayments and other current assets are summarized as follows: As of December 31, 2018 2017 General prepaid expenses $ 637,281 $ 174,369 Prepaid software license 85,936 - Security deposits 25,812 - Prepaid rent and other 109,294 - $ 858,323 $ 174,369 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment are summarized as follows: As of December 31, 2018 2017 Office equipment and computers $ 86,040 $ 46,309 Furniture and fixtures 22,419 21,220 108,459 67,529 Less accumulated depreciation and amortization (39,629 ) (12,859 ) Net property and equipment $ 68,830 $ 54,670 |
Platform Development (Tables)
Platform Development (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Platform Development | |
Summary of Platform Development Costs | Platform development costs are summarized as follows: As of December 31, 2018 2017 Platform development $ 6,833,900 $ 3,145,308 Less accumulated amortization (2,125,944 ) (512,251 ) Net platform development $ 4,707,956 $ 2,633,057 |
Summary of Platform Development Cost Activity | A summary of platform development activity for the year ended December 31, 2018 is as follows: Platform development at January 1, 2018 $ 3,145,308 Costs capitalized during the period: Payroll-based costs 2,156,015 Stock based compensation 1,850,384 Dispositions (317,807 ) Platform development at December 31, 2018 $ 6,833,900 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets Subjects to Amortization | Intangible assets subject to amortization consisted of the following: As of December 31, 2018 Carrying Amount Accumulated Amortization Net Carrying Amount Developed technology $ 14,750,000 $ (558,423 ) $ 14,191,577 Noncompete agreement 480,000 (12,000 ) 468,000 Trade name 748,000 (23,819 ) 724,181 Subtotal amortizable intangible assets 15,978,000 (594,242 ) 15,383,758 Website domain name 20,000 - 20,000 Total intangible assets $ 15,998,000 $ (594,242 ) $ 15,403,758 |
Schedule of Future Estimated Amortization Expenses for Intangible Assets | As of December 31, 2018, estimated total amortization expense for the next five years related to the Company’s intangible assets subject to amortization is as follows: December 31, 2019 $ 3,339,600 2020 3,327,600 2021 3,099,600 2022 3,099,600 2023 2,517,358 $ 15,383,758 |
Goodwill (Tables)
Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in Carrying Value of Goodwill | The changes in the carrying value of goodwill for the year ended December 31, 2018 is as follows: Goodwill at January 1, 2018 $ - Goodwill acquired in acquisition of HubPages 1,857,663 Goodwill acquired in acquisition of Say Media 5,466,624 Goodwill at December 31, 2018 $ 7,324,287 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Expenses | Accrued expenses are summarized as follows: As of December 31, 2018 2017 General accrued expenses $ 451,530 $ 150,136 Accrued payroll and related taxes 584,550 - Accrued publisher expenses 644,299 - Customer rebate 489,466 - Other accrued expenses 212,202 - Total accrued expenses $ 2,382,047 $ 150,136 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Schedule of Valuation Activity for the Warrants Accounted for Derivative Liability | The following table represents the carrying amount, valuation and roll-forward of activity for the Company’s warrants accounted for as a derivative liability and classified within Level 3 of the fair-value hierarchy for the year ended December 31, 2018: L2 Warrants Strome Warrants B. Riley Warrants Total Warrant Derivative Liabilities Carrying amount at January 1, 2018 $ - $ - $ - $ - Issuance of warrants on June 11, 2018 312,837 - - 312,837 Issuance of warrants on June 15, 2018 288,149 1,344,648 - 1,632,797 Issuance of warrants on October 18, 2018 - - 382,725 382,725 Change in valuation of warrant derivative liabilities (182,772 ) (756,677 ) (24,675 ) (964,124 ) Carrying amount at December 31, 2018 $ 418,214 $ 587,971 $ 358,050 $ 1,364,235 |
Schedule of Valuation Activity for the Embedded Conversion Feature Liability | The following table represents the carrying amount, valuation and a roll-forward of activity for the conversion option features, buy-in features, and default remedy features, as deemed appropriate for each instrument (collectively the embedded derivative liabilities), with respect to the 8% Promissory Notes, 10% Convertible Debentures, 10% OID Convertible Debentures, 12% Convertible Debentures (refer to Note 15 for each instrument), and Series G Preferred Stock (as described in Note 16) accounted for as embedded derivative liabilities and classified within Level 3 of the fair-value hierarchy for the year ended December 31, 2018: 8% Promissory Notes 10% Convertible Debentures 10% OID Convertible Debentures 12% Convertible Debentures Series G Preferred Stock Total Embedded Derivative Liabilities Carrying amount at December 31, 2017 $ - $ - $ - $ - $ 72,563 $ 72,563 Recognition of embedded derivative liabilities (conversion option feature) on June 11, 2018 78,432 - - - - 78,432 Recognition of embedded derivative liabilities (conversion option feature) on June 15, 2018 81,169 471,002 - - - 552,171 Recognition of embedded derivative liabilities (buy-in features and default remedy feature) on October 18, 2018 - - 49,000 - - 49,000 Recognition of embedded derivative liabilities (conversion option feature, buy-in feature, and default remedy feature) on December 12, 2018 - - - 4,760,000 - 4,760,000 Gain on extinguishment of embedded derivative liabilities upon extinguishment of host instrument (29,860 ) (1,042,000 ) (25,000 ) - - (1,096,860 ) Change in valuation of embedded derivative liabilities (129,741 ) 570,998 (24,000 ) 2,627,000 (72,563 ) 2,971,694 Carrying amount at December 31, 2018 $ - $ - $ - $ 7,387,000 $ - $ 7,387,000 |
Convertible Debt (Tables)
Convertible Debt (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Convertible Debt and Related Debt Components | Convertible debt and the related debt components for the year ended December 31, 2018 are summarized as follows: 8% 10% Convertible Debentures 10% OID Convertible Debentures 12% Convertible Debentures Total Convertible Debt and Debt Components Principal amount of debt $ 1,126,112 $ 4,775,000 $ 3,500,000 $ 9,540,000 $ 18,941,112 Less: original issue discount (111,112 ) - (175,000 ) - (286,112 ) Less: issuance costs (15,000 ) - (40,000 ) (590,000 ) (645,000 ) Net cash proceeds received $ 1,000,000 $ 4,775,000 $ 3,285,000 $ 8,950,000 $ 18,010,000 Principal amount of debt (excluding original issue discount) $ 1,015,000 $ 4,775,000 $ 3,325,000 $ 9,540,000 $ 18,655,000 Add: conversion of debt from 10% OID Convertible Debentures - - - 3,551,528 3,551,528 Add: accrued interest 20,986 69,920 28,009 82,913 201,828 Principal amount of debt including accrued interest 1,035,986 4,844,920 3,353,009 13,174,441 22,408,356 Debt discount: Allocated warrant derivative liabilities for B. Riley Warrants - - (382,725 ) - (382,725 ) Allocated warrant derivative liabilities for L2 Warrants (600,986 ) - - - (600,986 ) Allocated embedded derivative liabilities (159,601 ) (471,002 ) (49,000 ) (4,760,000 ) (5,439,603 ) Liquidated Damages recognized upon issuance (706,944 ) (706,944 ) Issuance costs (15,000 ) - (40,000 ) (590,000 ) (645,000 ) Subtotal debt discount (775,587 ) (471,002 ) (471,725 ) (6,056,944 ) (7,775,258 ) Less: amortization of debt discount 315,309 64,452 68,637 153,442 601,840 Less: write off unamortized debt discount upon extinguishment of debt 460,278 406,550 403,088 - 1,269,916 Unamortized debt discount - - - (5,903,502 ) (5,903,502 ) Debt components: Accretion of original issue discount 44,133 - 25,463 - 69,596 Loss on extinguishment of debt 292,201 885,080 173,056 - 1,350,337 Conversion of debt to 12% Convertible Debentures - - (3,551,528 ) - (3,551,528 ) Conversion of debt to Series H Preferred Stock - (5,730,000 ) - - (5,730,000 ) Repayment of convertible debt (1,372,320 ) - - - (1,372,320 ) Total debt components (1,035,986 ) (4,844,920 ) (3,353,009 ) - (9,233,915 ) Carrying amount at December 31, 2018 $ - $ - $ - $ 7,270,939 $ 7,270,939 |
Schedule of Interest Expense | Interest expense for the year ended December 31, 2018 is summarized as follows: 8% 10% Convertible Debentures 10% OID Convertible Debentures 12% Convertible Debentures Total Interest Expense Accretion of original issue discount $ 44,133 $ - $ 25,463 $ - $ 69,596 Amortization of debt discount 315,309 64,452 68,637 153,442 601,840 Loss on extinguishment of debt 292,201 885,080 173,056 - 1,350,337 Gain on extinguishment of embedded derivative liabilities upon extinguishment of host instrument (29,860 ) (1,042,000 ) (25,000 ) - (1,096,860 ) Write off unamortized debt discount upon extinguishment of debt 460,278 406,550 403,088 - 1,269,916 Accrued interest - 69,920 28,009 82,913 180,842 Cash interest paid 20,986 - - - 20,986 $ 1,103,047 $ 384,002 $ 673,253 $ 236,355 2,396,657 Accrued interest on Officer Promissory Notes 12,574 Other interest 99,643 Total $ 2,508,874 |
Preferred Stock (Tables)
Preferred Stock (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Schedule of Components of Series H Preferred Stock | The following table represents the components of the Series H Preferred Stock, stated value of $1,000 per share, for the year ended December 31, 2018: Shares Total Series H Preferred Stock Components Issuance of Series H Preferred Stock on August 10, 2018 19,400 $ 19,399,250 Less: shares issued to B. Riley FBR as placement fee (670 ) (669,250 ) Less: shares issued for conversion of principal of 10% Convertible Debentures (4,775 ) (4,775,000 ) Less: shares issued to 10% Convertible Debenture holders for additional payment of 20% annual internal rate of return (955 ) (955,000 ) Net issuance of Series H Preferred Stock 13,000 13,000,000 Payments made to B. Riley FBR from proceeds: Less: placement fee (500,000 ) Less: legal fees and other costs (25,296 ) Total payments made from proceeds (525,296 ) Net cash proceeds from issuance of Series H Preferred Stock $ 12,474,704 Issuance of Series H Preferred Stock $ 19,399,250 Less issuance costs: Shares issued to B. Riley FBR as placement fee (669,250 ) Total payments made from proceeds (525,296 ) Legal and other costs paid in cash (159,208 ) Total issuance costs (1,353,754 ) Beneficial conversion feature on Series H Preferred Stock $ 18,045,496 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Summary of Restricted Stock Award Activity | A summary of the restricted stock award activity during the year ended December 31, 2018 is as follows: Weighted Average Number of Shares Grant-Date Unvested Vested Fair Value Restricted stock awards outstanding at January 1, 2018 6,979,596 5,537,556 $ 0.41 Issued 4,606,503 - 0.72 Vested (4,946,490 ) 4,946,490 Forfeited (329,735 ) - Restricted stock awards outstanding at December 31, 2018 6,309,874 10,484,046 0.50 |
Summary of Warrant Activity | A summary of the Financing Warrants activity during the year ended December 31, 2018 is as follows: Weighted Average Weighted Remaining Number Average Contractual of Exercise Life Shares Price (in Years) Financing Warrants outstanding at January 1, 2018 1,289,172 $ 0.29 Issued 2,861,558 1.17 Exercised (842,117 ) 0.20 Issued as result of the reset provision on August 3, 2018 640,405 0.50 Financing Warrants outstanding at December 31, 2018 3,949,018 0.64 4.8 Financing Warrants exercisable at December 31, 2018 3,949,018 0.64 4.8 |
Schedule of Common Stock Financing Warrants Outstanding and Exercisable | The Financing Warrants outstanding, exercisable and reserved as of December 31, 2018 are summarized as follows: Exercise Price Expiration Date Financing Warrants Classified as Derivative Liabilities (Shares) Financing Warrants Classified within Stockholders’ Equity (Shares) Total Exercisable Financing Warrants (Shares) MDB Warrants $ 0.20 November 4, 2021 - 327,490 327,490 L2 Warrants 0.50 August 3, 2023 1,066,963 - 1,066,963 Strome Warrants 0.50 June 15, 2023 1,500,000 - 1,500,000 B. Riley Warrants 1.00 October 18, 2025 875,000 - 875,000 MDB Warrants 1.15 October 19, 2022 - 119,565 119,565 MDB Warrants 2.50 October 19, 2022 - 60,000 60,000 Total outstanding and exercisable 3,441,963 507,055 3,949,018 L2 Warrant reserve 2,133,926 - 2,133,926 Total outstanding, exercisable and reserved 5,575,889 507,055 6,082,944 |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Schedule of Fair Value of Stock Options Assumptions | The fair value of common stock options granted during the year ended December 31, 2018 were calculated using the Black-Scholes option-pricing model utilizing the following assumptions: Risk-free interest rate 2.27% to 3.05% Expected dividend yield 0.00 % Expected volatility 108.34% to 139.36% Expected life 3-6 years |
Summary of Stock Option Activity | A summary of the common stock option activity during the year ended December 31, 2018 is as follows: Weighted Average Weighted Remaining Number Average Contractual of Exercise Life Shares Price (in Years) Common stock options outstanding at January 1, 2018 2,176,637 $ 1.25 9.25 Granted 8,187,750 0.84 Exercised (125,000 ) 0.17 Forfeited (732,353 ) 1.41 Expired (101,493 ) 1.49 Common stock options outstanding at December 31, 2018 9,405,541 0.61 9.30 Common stock options exercisable at December 31, 2018 1,853,186 1.14 8.77 |
Schedule of Exercise Prices of Common Stock Options | The exercise prices of common stock options outstanding and exercisable are as follows as of December 31, 2018: Options Options Exercise Outstanding Exercisable Price (Shares) (Shares) Under $1.00 6,093,500 516,333 $1.01 to $1.25 1,707,482 921,946 $1.26 to $1.50 28,309 7,198 $1.51 to $1.75 345,000 108,542 $1.76 to $2.00 1,055,000 252,500 $2.01 to $2.25 135,000 5,417 $2.26 to $2.50 41,250 41,250 9,405,541 1,853,186 |
Schedule of Warrants Assumptions | The fair value of Channel Partner Warrants issued during the year ended December 31, 2018 were calculated using the Black-Scholes option-pricing model utilizing the following assumptions: Risk-free interest rate 2.53% to 2.89% Expected dividend yield 0.00 % Expected volatility 95.73% to 119.45% Expected life 3-5 years |
Schedule of Warrants Activity | A summary of the Channel Partner Warrants activity during the year ended December 31, 2018 is as follows: Weighted Average Weighted Remaining Number Average Contractual of Exercise Life Shares Price (in Years) Channel Partner Warrants outstanding at January 1, 2018 1,303,832 $ 1.48 4.35 Issued 295,000 1.74 Exercised - - Forfeited (581,692 ) 1.47 Channel Partner Warrants outstanding at December 31, 2018 1,017,140 1.47 3.57 Channel Partner Warrants exercisable at December 31, 2018 319,944 1.39 3.54 |
Summary of Stock-based Compensation | A summary of stock based compensation and equity-based expense charged to operations or capitalized are summarized as follows: Restricted Common Channel Stock Stock Partner Awards Options Warrants Totals During the year ended December 31, 2018: Cost of revenue $ 6,745 $ - $ 152,460 $ 159,205 Research and development 100,926 95,941 - 196,867 General and administrative 2,872,732 1,112,020 - 3,984,752 Total costs charged to operations 2,980,403 1,207,961 152,460 4,340,824 Capitalized platform development 1,639,038 211,346 - 1,850,384 Total stock based compensation $ 4,619,441 $ 1,419,307 $ 152,460 $ 6,191,208 During the year ended December 31, 2017: Cost of revenue $ - $ - $ 229,720 $ 229,720 Research and development - - - - General and administrative 777,206 618,761 - 1,395,967 Total costs charged to operations 777,206 618,761 229,720 1,625,687 Capitalized platform development 614,573 - - 614,573 Total stock based compensation $ 1,391,779 $ 618,761 $ 229,720 $ 2,240,260 |
Stock Options Outside 2016 Plan [Member] | |
Schedule of Fair Value of Stock Options Assumptions | The fair value of common stock options granted during the year ended December 31, 2018 were calculated using the Black-Scholes option-pricing model utilizing the following assumptions: Risk-free interest rate 2.79% to 3.09% Expected dividend yield 0.00 % Expected volatility 113.49% to 116.86% Expected life 6 years |
Summary of Stock Option Activity | Weighted Average Weighted Remaining Number Average Contractual of Exercise Life Shares Price (in Years) Stock options outstanding at January 1, 2018 - $ - - Granted 2,414,000 0.36 Stock options outstanding at December 31, 2018 2,414,000 0.36 9.94 Stock options exercisable at December 31, 2018 - - - |
Liquidated Damages (Tables)
Liquidated Damages (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Liquidated Damages Payable | |
Schedule of Recognized Liquidated Damages | The Company recognized Liquidated Damages during the year ended December 31, 2018, with respect to its registration rights agreements and securities purchase agreements as follows: MDB Common Stock to Be Issued Series H Preferred Stock 12% Convertible Debentures Total Liquidated Damages Registration Rights Damages $ 15,001 $ 1,163,955 $ - $ 1,178,956 Public Information Failure Damages - 1,163,955 706,944 1,870,899 Accrued interest - 481,017 116,726 597,743 Totals $ 15,001 $ 2,808,927 $ 823,670 $ 3,647,598 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income Taxes | The components of the benefit for income taxes is as follows: Years Ended December 31, 2018 2017 Current tax benefit Federal $ - $ - State and local - - Total current tax benefit - - Deferred tax benefit Federal 3,359,203 920,356 State and local 1,498,009 - Change in valuation allowance (4,765,579 ) (920,356 ) Total deferred tax benefit 91,633 - Total income tax benefit $ 91,633 $ - |
Schedule of Components of Deferred Tax Assets and Liabilities | The components of deferred tax assets and liabilities were as follows: As of December 31, 2018 2017 Deferred tax assets Net operating loss carryforwards $ 10,474,525 $ 1,544,591 Tax credit carryforwards 263,873 - Accrued expenses and other 64,849 38,328 Allowance for doubtful accounts 16,017 - Deferred rent 21,233 - Contract liabilities 84,622 3,631 Liquidating damages payable 646,146 - Stock based compensation 242,545 119,807 Depreciation and amortization 981,850 - Current deferred tax assets 12,795,660 1,706,357 Valuation allowance (8,541,191 ) (1,353,207 ) Total deferred tax assets 4,254,469 353,150 Deferred tax liabilities Depreciation and amortization - (353,150 ) Acquisition-related intangibles (4,254,469 ) - Total deferred tax liabilities (4,254,469 ) (353,150 ) Net deferred tax $ - $ - |
Schedule of Tax Benefit and Effective Income Tax | The benefit for income taxes on the statement of operations differs from the amount computed by applying the statutory federal income tax rate to loss before the benefit for income taxes, as follows: Years Ended December 31, 2018 2017 Amount Percent Amount Percent Federal benefit expected at statutory rate $ (5,493,498 ) 21.0 % $ (2,136,666 ) 34.0 % State and local taxes, net of federal benefit (1,498,009 ) 5.7 % - 0.0 % Impact of tax rate change - 0.0 % 837,699 (13.3 )% Stock based compensation 434,556 (1.7 )% - 0.0 % Other differences, net 246,614 (0.8 )% - 0.0 % Valuation allowance 4,765,579 (18.2 )% 920,356 (14.7 )% Permanent differences 1,453,125 (5.6 )% 378,611 (6.0 )% Tax benefit and effective income tax rate $ (91,633 ) 0.4 % $ - 0.0 % |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Sublease Rental Payments | The following table shows the aggregate commitment by year: Years ending December 31, 2019 $ 505,621 2020 347,845 2021 226,817 $ 1,080,283 |
Subsequent Events (Tables)
Subsequent Events (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Subsequent Events [Abstract] | |
Schedule of Liquidating Damages | The Company determined that it is contingently liable for certain for the Registration Rights Damages and Public Information Failure Damages (collectively the “Liquidating Damages”) covering the instruments in the table below, therefore, a contingent obligation (including interest computed at 1% per month based on the balance outstanding for each Liquidating Damages) exist as of the issuance date of these consolidated financial statements as follows: 12% Series I Series J Total Registration Rights Damages $ - $ 1,386,000 $ 400,000 $ 1,786,000 Public Information Failure Damages 120,000 1,155,000 200,000 1,475,000 Accrued interest 13,874 242,873 122,696 379,443 $ 133,874 $ 2,783,873 $ 722,696 $ 3,640,443 |
Organization and Basis of Pre_2
Organization and Basis of Presentation (Details Narrative) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 28, 2020 | |
Revenues | $ 5,700,199 | $ 76,995 | |
Net loss attributable to common shareholders | (44,113,379) | (6,284,313) | |
Net cash used in operating activities | (7,417,680) | (4,194,392) | |
Accumulated deficit | $ (34,539,954) | $ (8,472,071) | |
12% Senior Secured Note [Member] | |||
Debt instrument interest rate | 12.00% | ||
Borrowings subject to note holders approval | $ 5,000,000 | ||
Subsequent Event [Member] | |||
Available credit | $ 8,000,000 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | Jun. 15, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Aug. 23, 2018 | Dec. 19, 2016 |
Acquired finite-lived intangible assets, weighted average useful life | 5 years | 5 years | |||
Amortization debt discount | $ 601,840 | ||||
Advertising costs | $ 25,285 | $ 1,743 | |||
Common stock, shares authorized | 1,000,000,000 | 1,000,000,000 | |||
Board of Directors [Member] | Maximum [Member] | |||||
Number of warrant reserve shares | 5,000,000 | ||||
Board of Directors [Member] | Maximum [Member] | Warrant [Member] | |||||
Common stock, shares authorized | 5,000,000 | ||||
Board of Directors [Member] | Minimum [Member] | |||||
Number of warrant reserve shares | 2,000,000 | ||||
Platform Development [Member] | |||||
Estimated useful life of asset | 3 years | ||||
Convertible Debentures [Member] | |||||
Debt instrument interest rate | 10.00% | ||||
OID Convertible Debentures [Member] | |||||
Debt instrument interest rate | 10.00% | ||||
Convertible Debentures One [Member] | |||||
Debt instrument interest rate | 12.00% | ||||
Senior Secured Notes [Member] | |||||
Debt instrument interest rate | 12.00% | ||||
Amended Senior Secured Notes [Member] | |||||
Debt instrument interest rate | 12.00% |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Disaggregation of Revenue (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Revenue | $ 5,700,199 | $ 76,995 |
At Point in Time [Member] | ||
Revenue | 5,614,953 | 62,777 |
Over Time [Member] | ||
Revenue | 85,246 | 14,218 |
United States [Member] | ||
Revenue | 5,700,199 | 76,995 |
Other [Member] | ||
Revenue | ||
Advertising [Member] | ||
Revenue | 5,614,953 | 62,777 |
Membership Subscriptions [Member] | ||
Revenue | $ 85,246 | $ 14,218 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Schedule of Contract with Customer, Asset and Liability (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Factor receivables | $ 6,130,674 | $ 53,202 |
Short-term contract assets (contract fulfillment costs) | 17,056 | 14,147 |
Short-term contract liabilities | 396,407 | 31,437 |
Long-term contract liabilities | 252,500 | |
Advertising [Member] | ||
Factor receivables | 6,130,674 | 52,348 |
Short-term contract assets (contract fulfillment costs) | ||
Short-term contract liabilities | 325,863 | |
Long-term contract liabilities | 252,500 | |
Memberships [Member] | ||
Factor receivables | 854 | |
Short-term contract assets (contract fulfillment costs) | 17,056 | 14,147 |
Short-term contract liabilities | 70,544 | 31,437 |
Long-term contract liabilities |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Schedule of Cash and Restricted Cash (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Accounting Policies [Abstract] | ||
Cash and cash equivalents | $ 2,406,596 | $ 619,249 |
Restricted cash | 120,693 | 3,000,000 |
Total cash, cash equivalents, and restricted cash | $ 2,527,289 | $ 3,619,249 |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Schedule of Concentration of Credit Risk (Details) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Revenue [Member] | Customer 1 [Member] | ||
Concentration risk percentage | 35.50% | 0.00% |
Revenue [Member] | Customer 2 [Member] | ||
Concentration risk percentage | 14.80% | 0.00% |
Accounts Receivable [Member] | Customer 1 [Member] | ||
Concentration risk percentage | 16.80% | 0.00% |
Accounts Receivable [Member] | Customer 2 [Member] | ||
Concentration risk percentage | 0.00% | 0.00% |
Accounts Payable [Member] | Vendor 1 [Member] | ||
Concentration risk percentage | 29.40% | 0.00% |
Accounts Payable [Member] | Vendor 2 [Member] | ||
Concentration risk percentage | 11.50% | 0.00% |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies - Schedule of Depreciation and Amortization, Useful Lives of Assets (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Office Equipment and Computers [Member] | |
Property, plant and equipment, useful life | 3 years |
Furniture and Fixtures [Member] | Minimum [Member] | |
Property, plant and equipment, useful life | 3 years |
Furniture and Fixtures [Member] | Maximum [Member] | |
Property, plant and equipment, useful life | 5 years |
Summary of Significant Accou_10
Summary of Significant Accounting Policies - Schedule of Net Income (Loss) Per Common Share (Details) - shares | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Antidilutive securities excluded from computation of earnings per share amount | 82,897,246 | 11,847,935 |
Series G Preferred Stock [Member] | ||
Antidilutive securities excluded from computation of earnings per share amount | 188,791 | 98,698 |
Series H Preferred Stock [Member] | ||
Antidilutive securities excluded from computation of earnings per share amount | 58,787,879 | |
Indemnity Shares of Common Stock [Member] | ||
Antidilutive securities excluded from computation of earnings per share amount | 825,000 | |
Unvested and Forfeitable Restricted Stock Awards [Member] | ||
Antidilutive securities excluded from computation of earnings per share amount | 6,309,876 | 6,979,596 |
Financing Warrants [Member] | ||
Antidilutive securities excluded from computation of earnings per share amount | 3,949,018 | 1,289,172 |
Channel Partner Warrants [Member] | ||
Antidilutive securities excluded from computation of earnings per share amount | 1,017,141 | 1,303,832 |
2016 Plan [Member] | ||
Antidilutive securities excluded from computation of earnings per share amount | 9,405,541 | 2,176,637 |
Options Outside [Member] | ||
Antidilutive securities excluded from computation of earnings per share amount | 2,414,000 |
Acquisitions (Details Narrative
Acquisitions (Details Narrative) - USD ($) | Dec. 12, 2018 | Aug. 27, 2018 | Aug. 23, 2018 | Aug. 23, 2018 | Jun. 15, 2018 | Oct. 31, 2016 | Aug. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Jun. 01, 2018 |
Payments to acquire businesses, gross | $ 18,035,356 | ||||||||||
Total cash consideration | $ 10,569,904 | ||||||||||
Number of shares issued during period, shares | 307,475 | 12,209,677 | |||||||||
Useful life for intangible assets | 5 years | 5 years | |||||||||
Stock issued during period, value, acquisitions | |||||||||||
Income tax benefit | (91,633) | ||||||||||
Change in fair value of embedded derivatives | (2,971,694) | 64,614 | |||||||||
Net settlement of preexisting relationship | $ 552,314 | 552,314 | |||||||||
Business acquisition, pro forma net income (loss) | (28,072,040) | 6,777,119 | |||||||||
Interest expense | 2,508,874 | ||||||||||
Hub Pages Inc [Member] | |||||||||||
Deposit into escrow | $ 5,000,000 | ||||||||||
Total cash consideration | 10,000,000 | ||||||||||
Legal fees | $ 569,904 | ||||||||||
Number of shares issued during period, shares | 2,400,000 | 2,399,997 | |||||||||
Transaction costs related to acquisition | $ 218,981 | ||||||||||
Proforma for acquisition of related cost | 218,981 | ||||||||||
Income tax benefit | 91,633 | ||||||||||
Merger related cost | 511,108 | 687,528 | |||||||||
Amortization of acquired assets | 678,916 | 998,264 | |||||||||
Business acquisition, pro forma net income (loss) | 471,640 | ||||||||||
Hub Pages Inc [Member] | Merger Agreement [Member] | |||||||||||
Deposit into escrow | $ 5,000,000 | ||||||||||
Payments to acquire businesses, gross | $ 5,000,000 | ||||||||||
Total cash consideration | $ 10,569,904 | ||||||||||
Say Media, Inc. [Member] | |||||||||||
Proforma for acquisition of related cost | 479,289 | ||||||||||
Amortization of acquired assets | 385,731 | 798,204 | |||||||||
Change in fair value of embedded derivatives | 258,485 | ||||||||||
Net settlement of preexisting relationship | $ 2,371,124 | 2,371,124 | |||||||||
Business acquisition, pro forma net income (loss) | 75,661 | 196,140 | |||||||||
Interest expense | $ 2,508,161 | $ 4,965,607 | |||||||||
Say Media, Inc. [Member] | Merger Agreement [Member] | |||||||||||
Total cash consideration | $ 12,257,022 | $ 55,246 | |||||||||
Legal fees | 505,246 | $ 450,000 | |||||||||
Business combination recognized identifiable creditor | 6,703,653 | ||||||||||
Business combination recognized identifiable transaction bonus | 250,000 | ||||||||||
Business combination recognized identifiable advanced amount | 2,078,498 | ||||||||||
Stock issued during period, value, acquisitions | $ 432,835 | ||||||||||
Stock issued during period, shares, acquisitions | 5,500,002 | 2,000,000 | 2,000,000 | 432,835 | |||||||
Business acquisition, share price | $ 0.35 | ||||||||||
Business combination, recognized identifiable asset acquired and liability assumed, lease obligation | $ 416,378 | ||||||||||
Proforma for acquisition of related cost | 479,289 | ||||||||||
Say Media, Inc. [Member] | Noncompete [Member] | |||||||||||
Business combination, step acquisition, equity interest in acquiree, fair value | 242,310 | ||||||||||
Proforma for acquisition of related cost | $ 479,289 | ||||||||||
Say Media, Inc. [Member] | Noncompete [Member] | OID Convertible Debentures [Member] | |||||||||||
Business combination, step acquisition, equity interest in acquiree, percentage | 10.00% | ||||||||||
Say Media, Inc. [Member] | Noncompete [Member] | Convertible Debentures Financings [Member] | |||||||||||
Business combination, step acquisition, equity interest in acquiree, percentage | 12.00% |
Acquisitions - Summary of Price
Acquisitions - Summary of Price Allocation for Acquisition (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Cash | $ 9,537,397 | |
Noncompete agreement | 242,310 | |
Goodwill | 7,324,287 | |
Net assets acquired | 12,257,022 | |
Hub Pages Inc [Member] | ||
Cash | 1,537,308 | |
Current assets | 50,788 | |
Accounts receivable and unbilled receivables | 1,033,080 | |
Other assets | 25,812 | |
Developed technology | 6,740,000 | |
Trade name | 268,000 | |
Goodwill | 1,857,663 | |
Current liabilities | (851,114) | |
Deferred tax liability | (91,633) | |
Net assets acquired | 10,569,904 | |
Say Media, Inc. [Member] | ||
Cash | 534,637 | |
Accounts receivable and unbilled receivables | 4,624,455 | |
Prepaid expenses | 172,648 | |
Note receivable | 41,638 | |
Fixed assets | 11,392 | |
Other assets | 65,333 | |
Developed technology | 8,010,000 | |
Trade name | 480,000 | |
Noncompete agreement | 480,000 | |
Goodwill | 5,466,624 | |
Accounts payable | (3,618,112) | |
Accrued expenses | (1,470,749) | |
Contract liabilities | (513,336) | |
Other liabilities | (2,027,508) | |
Net assets acquired | $ 12,257,022 |
Acquisitions - Schedule of Shar
Acquisitions - Schedule of Shares Issued for Post Combination Services (Details) | Dec. 31, 2018USD ($) |
Payables and Accruals [Abstract] | |
Cash | $ 9,537,397 |
Issued shares of common stock | 1,636,251 |
Indemnity shares of common stock | 288,750 |
Net settlement of preexisting relationship | 552,314 |
Noncompete agreement | 242,310 |
Total purchase consideration | $ 12,257,022 |
Acquisitions - Schedule of Pro-
Acquisitions - Schedule of Pro-forma Information for Acquisition (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Net income (loss) | $ (28,072,040) | $ 6,777,119 |
Net income (loss) per common share - basic and diluted | $ (.81) | $ .33 |
Weighted average number of common shares outstanding - basic and diluted | $ 34,444,608 | $ 20,849,067 |
Pro Forma [Member] | ||
Business acquisition, pro forma revenue | $ 22,675,961 | $ 17,590,152 |
Net income (loss) | 28,072,040 | 6,777,119 |
Pro Forma [Member] | Adjustment [Member] | ||
Business acquisition, pro forma revenue | (1,376,478) | |
Net income (loss) | (5,774,681) | (8,344,013) |
Hub Pages Inc [Member] | ||
Business acquisition, pro forma revenue | 2,996,700 | |
Net income (loss) | 471,640 | |
Hub Pages Inc [Member] | Pro Forma [Member] | ||
Business acquisition, pro forma revenue | 7,537,166 | 4,904,759 |
Net income (loss) | 951,836 | 575,963 |
Say Media, Inc. [Member] | ||
Business acquisition, pro forma revenue | 1,398,690 | |
Net income (loss) | 75,661 | 196,140 |
Say Media, Inc. [Member] | Pro Forma [Member] | ||
Business acquisition, pro forma revenue | 15,210,464 | 12,608,398 |
Net income (loss) | 3,365,989 | 20,829,482 |
Acquisition [Member] | ||
Business acquisition, pro forma revenue | 4,395,390 | |
Net income (loss) | 547,301 | |
Maven [Member] | Pro Forma [Member] | ||
Business acquisition, pro forma revenue | 1,304,809 | 76,995 |
Net income (loss) | $ (26,615,184) | $ (6,284,313) |
Prepayments and Other Current_3
Prepayments and Other Current Assets - Schedule of Prepayments and Other Current Assets (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Prepayments And Other Current Assets | ||
General prepaid expenses | $ 637,281 | $ 174,369 |
Prepaid software license | 85,936 | |
Security deposits | 25,812 | |
Prepaid rent and other | 109,294 | |
Prepayments and other current assets | $ 858,323 | $ 174,369 |
Property and Equipment (Details
Property and Equipment (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expense | $ 28,857 | $ 12,469 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Gross property and equipment costs | $ 108,459 | $ 67,529 |
Less accumulated depreciation and amortization | (39,629) | (12,859) |
Net property and equipment | 68,830 | 54,670 |
Office Equipment and Computers [Member] | ||
Gross property and equipment costs | 86,040 | 46,309 |
Furniture and Fixtures [Member] | ||
Gross property and equipment costs | $ 22,419 | $ 21,220 |
Platform Development (Details N
Platform Development (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Amortization expense platform development | $ 1,836,625 | $ 512,252 |
Stock based compensation | $ 4,340,824 | 1,625,687 |
Platform Development Cost [Member] | ||
Capitalized cost | 2,594,691 | |
Stock based compensation | $ 614,573 |
Platform Development - Summary
Platform Development - Summary of Platform Development Costs (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Platform development | $ 108,459 | $ 67,529 |
Less accumulated amortization | (39,629) | (12,859) |
Net platform development | 68,830 | 54,670 |
Platform Development [Member] | ||
Platform development | 6,833,900 | 3,145,308 |
Less accumulated amortization | (2,125,944) | (512,251) |
Net platform development | $ 4,707,956 | $ 2,633,057 |
Platform Development - Summar_2
Platform Development - Summary of Platform Development Cost Activity (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Platform development, beginning balance | $ 54,670 | |
Stock based compensation | 4,340,824 | $ 1,625,687 |
Platform development, ending balance | 68,830 | 54,670 |
Platform Development [Member] | ||
Platform development, beginning balance | 2,633,057 | |
Costs capitalized during the period: Payroll-based costs | 2,156,015 | |
Stock based compensation | 1,850,384 | |
Dispositions | (317,807) | |
Platform development, ending balance | $ 4,707,956 | $ 2,633,057 |
Intangible Assets (Details Narr
Intangible Assets (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Amortization expense of intangible asset | $ 594,242 | |
Impairment charges | ||
Intangible assets, net | 15,403,758 | $ 20,000 |
Website Domain Name [Member] | ||
Intangible assets, net | $ 20,000 | $ 20,000 |
Intangible Assets - Schedule of
Intangible Assets - Schedule of Intangible Assets Subjects to Amortization (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Intangible assets, gross | $ 15,998,000 | |
Intangible assets, accumulated amortization | (594,242) | |
Intangible assets, net | 15,403,758 | $ 20,000 |
Developed Technology [Member] | ||
Intangible assets, gross | 14,750,000 | |
Intangible assets, accumulated amortization | (558,423) | |
Intangible assets, net | 14,191,577 | |
Noncompete Agreement [Member] | ||
Intangible assets, gross | 480,000 | |
Intangible assets, accumulated amortization | (12,000) | |
Intangible assets, net | 468,000 | |
Trade name [Member] | ||
Intangible assets, gross | 748,000 | |
Intangible assets, accumulated amortization | (23,819) | |
Intangible assets, net | 724,181 | |
Subtotal Amortizable Intangible Assets [Member] | ||
Intangible assets, gross | 15,978,000 | |
Intangible assets, accumulated amortization | (594,242) | |
Intangible assets, net | 15,383,758 | |
Website Domain Name [Member] | ||
Intangible assets, gross | 20,000 | |
Intangible assets, accumulated amortization | ||
Intangible assets, net | $ 20,000 | $ 20,000 |
Intangible Assets - Schedule _2
Intangible Assets - Schedule of Future Estimated Amortization Expenses for Intangible Assets (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2019 | $ 3,339,600 | |
2020 | 3,327,600 | |
2021 | 3,099,600 | |
2022 | 3,099,600 | |
2023 | 2,517,358 | |
Intangible assets, net | $ 15,403,758 | $ 20,000 |
Goodwill - Schedule of Changes
Goodwill - Schedule of Changes in Carrying Value of Goodwill (Details) | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill, Beginning | |
Goodwill acquired in acquisition of HubPages | 1,857,663 |
Goodwill acquired in acquisition of Say Media | 5,466,624 |
Goodwill, Ending | $ 7,324,287 |
Accrued Expenses - Schedule of
Accrued Expenses - Schedule of Accrued Expenses (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Payables and Accruals [Abstract] | ||
General accrued expenses | $ 451,530 | $ 150,136 |
Accrued payroll and related taxes | 584,550 | |
Accrued publisher expenses | 644,299 | |
Customer rebate | 489,466 | |
Other accrued expenses | 212,202 | |
Total accrued expenses | $ 2,382,047 | $ 150,136 |
Line of Credit (Details Narrati
Line of Credit (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | |
Nov. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Outstanding amount | $ 1,048,194 | ||
Factoring Note Agreement [Member] | |||
Outstanding amount | $ 1,048,194 | ||
Debt instrument interest rate | 3.00% | ||
Initial factoring fee | 0.415% | ||
Debt fee | $ 950 | ||
Factoring Note Agreement [Member] | Prime Rate [Member] | |||
Line of credit interest rate | 4.00% | 9.50% | |
Factoring Note Agreement [Member] | Floor Rate [Member] | |||
Line of credit interest rate | 5.00% | ||
Factoring Note Agreement [Member] | Maximum [Member] | |||
Line of credit , maximum borrowing capacity | $ 3,500,000 | ||
Line of credit , maximum borrowing percentage | 85.00% | ||
Factoring Note Agreement [Member] | Minimum [Member] | |||
Monthly sales volume amount | $ 1,000,000 |
Liquidated Damages Payable (Det
Liquidated Damages Payable (Details Narrative) - USD ($) | Dec. 12, 2018 | Dec. 31, 2018 |
Liquidated Damages Payable | ||
Liquidating damages payable | $ 3,647,598 | |
Liquidating damages description | On December 12, 2018, the Company determined that the public information requirements in connection with the 12% Convertible Debentures (as further described below) would not be probable of being satisfied within the requisite time frame, therefore, the Company would be liable for the a portion Liquidated Damages in connection with the 12% Convertible Debentures, with any related interest provisions (see Note 16). |
Fair Value Measurements (Detail
Fair Value Measurements (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Cash and cash equivalents | $ 2,406,596 | $ 619,249 |
Change in valuation of warrant derivative liabilities | 964,124 | |
Change in valuation of embedded derivative liabilities | (2,971,694) | 64,614 |
Derivative liabilities | 1,364,235 | |
Series G Preferred Stock [Member] | ||
Change in valuation of embedded derivative liabilities | 64,614 | |
Derivative liabilities | 72,563 | 72,563 |
L2 Warrants [Member] | ||
Derivative liabilities | 418,214 | |
Strome Warrants [Member] | ||
Derivative liabilities | 587,971 | |
B. Riley Warrants [Member] | ||
Derivative liabilities | $ 358,050 | |
Expected Life [Member] | L2 Warrants [Member] | ||
Fair value assumptions, measurement input, term | 4 years 5 months 9 days | |
Expected Life [Member] | Strome Warrants [Member] | ||
Fair value assumptions, measurement input, term | 4 years 5 months 12 days | |
Expected Life [Member] | B. Riley Warrants [Member] | ||
Fair value assumptions, measurement input, term | 6 years 9 months 18 days | |
Measurement Input, Risk Free Interest Rate [Member] | L2 Warrants [Member] | ||
Fair value assumptions, measurement input, percentages | 2.49% | |
Measurement Input, Risk Free Interest Rate [Member] | Strome Warrants [Member] | ||
Fair value assumptions, measurement input, percentages | 2.49% | |
Measurement Input, Risk Free Interest Rate [Member] | B. Riley Warrants [Member] | ||
Fair value assumptions, measurement input, percentages | 2.59% | |
Volatility Factor [Member] | L2 Warrants [Member] | ||
Fair value assumptions, measurement input, percentages | 124.40% | |
Volatility Factor [Member] | Strome Warrants [Member] | ||
Fair value assumptions, measurement input, percentages | 124.22% | |
Volatility Factor [Member] | B. Riley Warrants [Member] | ||
Fair value assumptions, measurement input, percentages | 121.65% | |
Dividend Rate [Member] | ||
Fair value assumptions, measurement input, percentages | 0.00% | |
Dividend Rate [Member] | L2 Warrants [Member] | ||
Fair value assumptions, measurement input, percentages | 0.00% | |
Dividend Rate [Member] | Strome Warrants [Member] | ||
Fair value assumptions, measurement input, percentages | 0.00% | |
Dividend Rate [Member] | B. Riley Warrants [Member] | ||
Fair value assumptions, measurement input, percentages | 0.00% | |
Market Price [Member] | L2 Warrants [Member] | ||
Fair value assumptions, measurement input, price per share | $ 0.48 | |
Market Price [Member] | Strome Warrants [Member] | ||
Fair value assumptions, measurement input, price per share | 0.48 | |
Market Price [Member] | B. Riley Warrants [Member] | ||
Fair value assumptions, measurement input, price per share | 0.48 | |
Exercise Price [Member] | L2 Warrants [Member] | ||
Fair value assumptions, measurement input, price per share | 0.50 | |
Exercise Price [Member] | Strome Warrants [Member] | ||
Fair value assumptions, measurement input, price per share | 0.50 | |
Exercise Price [Member] | B. Riley Warrants [Member] | ||
Fair value assumptions, measurement input, price per share | $ 1 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Valuation Activity for the Warrants Accounted for Derivative Liability (Details) | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Derivative liabilities, carrying amount, beginning | |
Derivative liabilities, carrying amount, ending | 1,364,235 |
L2 Warrants [Member] | |
Derivative liabilities, carrying amount, beginning | |
Issuance of warrants on June 11, 2018 | 312,837 |
Issuance of warrants on June 15, 2018 | 288,149 |
Issuance of warrants on October 18, 2018 | |
Change in valuation of warrant derivative liabilities | (182,772) |
Derivative liabilities, carrying amount, ending | 418,214 |
Strome Warrants [Member] | |
Derivative liabilities, carrying amount, beginning | |
Issuance of warrants on June 11, 2018 | |
Issuance of warrants on June 15, 2018 | 1,344,648 |
Issuance of warrants on October 18, 2018 | |
Change in valuation of warrant derivative liabilities | (756,677) |
Derivative liabilities, carrying amount, ending | 587,971 |
B. Riley Warrants [Member] | |
Derivative liabilities, carrying amount, beginning | |
Issuance of warrants on June 11, 2018 | |
Issuance of warrants on June 15, 2018 | |
Issuance of warrants on October 18, 2018 | 382,725 |
Change in valuation of warrant derivative liabilities | (24,675) |
Derivative liabilities, carrying amount, ending | 358,050 |
Warrants [Member] | |
Derivative liabilities, carrying amount, beginning | |
Issuance of warrants on June 11, 2018 | 312,837 |
Issuance of warrants on June 15, 2018 | 1,632,797 |
Issuance of warrants on October 18, 2018 | 382,725 |
Change in valuation of warrant derivative liabilities | (964,124) |
Derivative liabilities, carrying amount, ending | $ 1,364,235 |
Fair Value Measurements - Sch_2
Fair Value Measurements - Schedule of Valuation Activity for the Embedded Conversion Feature Liability (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Derivative liabilities, carrying amount, beginning | ||
Gain on extinguishment of embedded derivative liabilities upon extinguishment of host instrument | (1,350,337) | |
Change in valuation of embedded derivative liabilities | (2,971,694) | 64,614 |
Derivative liabilities, carrying amount, ending | 1,364,235 | |
10% Convertible Debentures [Member] | ||
Gain on extinguishment of embedded derivative liabilities upon extinguishment of host instrument | (885,080) | |
10% OID Convertible Debentures [Member] | ||
Gain on extinguishment of embedded derivative liabilities upon extinguishment of host instrument | (173,056) | |
Embedded Conversion Feature Liability [Member] | ||
Derivative liabilities, carrying amount, beginning | 72,563 | |
Recognition of embedded derivative liabilities (conversion option feature) on June 11, 2018 | 78,432 | |
Recognition of embedded derivative liabilities (conversion option feature) on June 15, 2018 | 552,171 | |
Recognition of embedded derivative liabilities (buy-in features and default remedy feature) on October 18, 2018 | 49,000 | |
Recognition of embedded derivative liabilities (conversion option feature, buy-in feature, and default remedy feature) on December 12, 2018 | 4,760,000 | |
Gain on extinguishment of embedded derivative liabilities upon extinguishment of host instrument | (1,096,860) | |
Change in valuation of embedded derivative liabilities | 2,971,694 | |
Derivative liabilities, carrying amount, ending | 7,387,000 | 72,563 |
Embedded Conversion Feature Liability [Member] | 8% Promissory Notes [Member] | ||
Derivative liabilities, carrying amount, beginning | ||
Recognition of embedded derivative liabilities (conversion option feature) on June 11, 2018 | 78,432 | |
Recognition of embedded derivative liabilities (conversion option feature) on June 15, 2018 | 81,169 | |
Recognition of embedded derivative liabilities (buy-in features and default remedy feature) on October 18, 2018 | ||
Recognition of embedded derivative liabilities (conversion option feature, buy-in feature, and default remedy feature) on December 12, 2018 | ||
Gain on extinguishment of embedded derivative liabilities upon extinguishment of host instrument | (29,860) | |
Change in valuation of embedded derivative liabilities | (129,741) | |
Derivative liabilities, carrying amount, ending | ||
Embedded Conversion Feature Liability [Member] | 10% Convertible Debentures [Member] | ||
Derivative liabilities, carrying amount, beginning | ||
Recognition of embedded derivative liabilities (conversion option feature) on June 11, 2018 | ||
Recognition of embedded derivative liabilities (conversion option feature) on June 15, 2018 | 471,002 | |
Recognition of embedded derivative liabilities (buy-in features and default remedy feature) on October 18, 2018 | ||
Recognition of embedded derivative liabilities (conversion option feature, buy-in feature, and default remedy feature) on December 12, 2018 | ||
Gain on extinguishment of embedded derivative liabilities upon extinguishment of host instrument | (1,042,000) | |
Change in valuation of embedded derivative liabilities | 570,998 | |
Derivative liabilities, carrying amount, ending | ||
Embedded Conversion Feature Liability [Member] | 10% OID Convertible Debentures [Member] | ||
Derivative liabilities, carrying amount, beginning | ||
Recognition of embedded derivative liabilities (conversion option feature) on June 11, 2018 | ||
Recognition of embedded derivative liabilities (conversion option feature) on June 15, 2018 | ||
Recognition of embedded derivative liabilities (buy-in features and default remedy feature) on October 18, 2018 | 49,000 | |
Recognition of embedded derivative liabilities (conversion option feature, buy-in feature, and default remedy feature) on December 12, 2018 | ||
Gain on extinguishment of embedded derivative liabilities upon extinguishment of host instrument | (25,000) | |
Change in valuation of embedded derivative liabilities | (24,000) | |
Derivative liabilities, carrying amount, ending | ||
Embedded Conversion Feature Liability [Member] | 12% Convertible Debentures [Member] | ||
Derivative liabilities, carrying amount, beginning | ||
Recognition of embedded derivative liabilities (conversion option feature) on June 11, 2018 | ||
Recognition of embedded derivative liabilities (conversion option feature) on June 15, 2018 | ||
Recognition of embedded derivative liabilities (buy-in features and default remedy feature) on October 18, 2018 | ||
Recognition of embedded derivative liabilities (conversion option feature, buy-in feature, and default remedy feature) on December 12, 2018 | 4,760,000 | |
Gain on extinguishment of embedded derivative liabilities upon extinguishment of host instrument | ||
Change in valuation of embedded derivative liabilities | 2,627,000 | |
Derivative liabilities, carrying amount, ending | 7,387,000 | |
Embedded Conversion Feature Liability [Member] | Series G Preferred Stock [Member] | ||
Derivative liabilities, carrying amount, beginning | 72,563 | |
Recognition of embedded derivative liabilities (conversion option feature) on June 11, 2018 | ||
Recognition of embedded derivative liabilities (conversion option feature) on June 15, 2018 | ||
Recognition of embedded derivative liabilities (buy-in features and default remedy feature) on October 18, 2018 | ||
Recognition of embedded derivative liabilities (conversion option feature, buy-in feature, and default remedy feature) on December 12, 2018 | ||
Gain on extinguishment of embedded derivative liabilities upon extinguishment of host instrument | ||
Change in valuation of embedded derivative liabilities | (72,563) | |
Derivative liabilities, carrying amount, ending | $ 72,563 |
Officer Promissory Notes (Detai
Officer Promissory Notes (Details Narrative) - Promissory Note [Member] - Chief Executive Officer [Member] | Dec. 31, 2018USD ($) |
Federal rate, percentage | 2.34% |
Notes payable outstanding | $ 680,399 |
Accrued interest payable | $ 12,574 |
Investor Demand Payable (Detail
Investor Demand Payable (Details Narrative) | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Investor Demand Payable | |
Proceeds from common stock | $ 3,000,000 |
Convertible Debt (Details Narra
Convertible Debt (Details Narrative) | Apr. 08, 2019USD ($) | Mar. 27, 2019USD ($) | Dec. 12, 2018USD ($)$ / shares | Sep. 06, 2018USD ($) | Aug. 10, 2018USD ($)shares | Jun. 15, 2018USD ($)$ / sharesshares | Jun. 11, 2018USD ($)Tradingdays$ / sharesshares | Jun. 06, 2018USD ($) | Nov. 30, 2001shares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($) | Dec. 31, 2020USD ($) | Oct. 31, 2019$ / shares | Oct. 18, 2018USD ($) | Aug. 03, 2018$ / shares |
Exercise price of warrants | $ / shares | $ 0.20 | $ 0.50 | |||||||||||||
Derivative liability | $ 1,344,648 | ||||||||||||||
Loss on extinguishment of debt | (1,350,337) | ||||||||||||||
Change in fair value of derivative liability | 964,124 | ||||||||||||||
Loan borrowed amount | $ 396,407 | 31,437 | |||||||||||||
Conversion price | $ / shares | $ 0.33 | ||||||||||||||
Amortization of debt discount | $ 601,840 | ||||||||||||||
Embedded Conversion Option [Member] | |||||||||||||||
Derivative liability | 4,760,000 | ||||||||||||||
Change in fair value of derivative liability | 2,627,000 | ||||||||||||||
Debt issuance costs | 590,000 | ||||||||||||||
Amortization of debt discount | 135,533 | ||||||||||||||
Subsequent Event [Member] | |||||||||||||||
Conversion price | $ / shares | $ 1 | ||||||||||||||
Common Stock [Member] | |||||||||||||||
Conversion of convertible shares | shares | 1,632 | ||||||||||||||
12% Convertible Debentures [Member] | |||||||||||||||
Debt instrument, face amount | $ 13,091,528 | ||||||||||||||
Purchase price | $ 8,950,000 | ||||||||||||||
Debt instrument interest rate | 12.00% | ||||||||||||||
Debt, description | The 12% Convertible Debentures are due and payable on December 31, 2020. Interest accrues at the rate of 12% per annum, payable on the earlier of conversion or December 31, 2020. | ||||||||||||||
Conversion price | $ / shares | $ 0.33 | ||||||||||||||
Placement fee payable in cash | $ 540,000 | ||||||||||||||
Debt maturity date | Dec. 31, 2020 | ||||||||||||||
12% Convertible Debentures [Member] | Subsequent Event [Member] | |||||||||||||||
Debt instrument, face amount | $ 18,104,949 | ||||||||||||||
Purchase price | $ 100,000 | $ 300,000 | |||||||||||||
10% OID Convertible Debentures [Member] | |||||||||||||||
Loss on extinguishment of debt | (173,056) | ||||||||||||||
Amortization of debt discount | 68,637 | ||||||||||||||
12% Convertible Debentures [Member] | |||||||||||||||
Loss on extinguishment of debt | |||||||||||||||
Conversion of convertible shares | shares | 39,671,296 | ||||||||||||||
Conversion description | As long as any portion of the 12% Convertible Debentures remain outstanding, unless investors holding at least 51% in principal amount of the then outstanding 12% Convertible Debentures otherwise agree, the Company shall not, among other things enter into, incur, assume or guarantee any indebtedness, except for certain permitted indebtedness. | ||||||||||||||
Ownership percentage | 4.99% | ||||||||||||||
Voting percentage | 50.00% | ||||||||||||||
Voting transaction description | (a) an acquisition in excess of 50% of the voting securities of the Company; (b) the Company merges into or consolidates whereby the Company stockholders own less than 50% of the aggregate voting power after the transaction; (c) the Company sells or transfers all or substantially all of its assets to whereby the Company stockholders own less than 50% of the aggregate voting power after the transaction; (d) a replacement at one time or within a three year period of more than one-half of the Directors which is not approved by a majority of those individuals who are members of the Directors on the original issue date, subject to certain conditions; or (e) the execution by the Company of an agreement for any of the events set forth in clauses (a) through (d) above. | ||||||||||||||
Transaction description | (a) the Company, directly or indirectly, in one or more related transactions effects any merger or consolidation; (b) the Company, directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets in one or a series of related transactions; (c) any, direct or indirect, purchase offer, tender offer or exchange offer is completed pursuant to which the Company common stock holders are permitted to sell, tender or exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the Company's outstanding common stock; (d) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization or recapitalization of the Company's common stock or any compulsory share exchange pursuant to which the common stock is effectively converted into or exchanged for other securities, cash or property, or (e) the Company, directly or indirectly, in one or more related transactions consummates a stock or share purchase agreement or other business combination whereby such transaction results in an acquisition of more than 50% of the outstanding shares of the Company's common stock, subject to certain other conditions. Further, if a Fundamental Transaction occurs, the holders shall have the right to their conversion shares as if the beneficial ownership limitation or the issuance limitation was not in place, subject to certain terms as addition consideration. | ||||||||||||||
Amortization of debt discount | $ 153,442 | ||||||||||||||
12% Convertible Debentures [Member] | Holder [Member] | |||||||||||||||
Conversion of convertible shares | shares | 566,398 | ||||||||||||||
Ownership percentage | 9.99% | ||||||||||||||
Investors [Member] | 10% OID Convertible Debentures [Member] | |||||||||||||||
Debt instrument, face amount | $ 3,551,528 | ||||||||||||||
Security Purchase Agreement [Member] | Holder [Member] | |||||||||||||||
Debt, description | To each holder, consisting of a cash payment equal to 1% of the amount invested as partial liquidated damages, up to a maximum of six months, subject to interest at the rate of 1% per month until paid in full. | ||||||||||||||
Security Purchase Agreement [Member] | 12% Convertible Debentures [Member] | Investors [Member] | |||||||||||||||
Debt, description | The Company committed to file the registration statement the later of (i) the 30th calendar day following the date the Company files its Annual Report on Form 10-K for the fiscal year ended December 31, 2018 with the SEC, but in no event later than May 15, 2019, and (ii) the 30th calendar day after all the Series H Preferred Stock have been registered pursuant to a registration statement under a certain registration rights agreement, dated as of August 9, 2018. The registration rights agreements provide for Registration Rights Damages (presented within liquidated damages payable on the consolidated balance sheets) upon the occurrence of certain events up to a maximum amount of 6% of the aggregate amount invested. | ||||||||||||||
8% Promissory Notes [Member] | |||||||||||||||
Derivative liability | $ 760,587 | ||||||||||||||
Warrants derivative liability | 600,986 | ||||||||||||||
Embedded conversion feature derivative liability | 159,601 | ||||||||||||||
Loss on extinguishment of debt | 29,860 | ||||||||||||||
Change in fair value of derivative liability | 129,741 | ||||||||||||||
Loan borrowed amount | $ 1,015,000 | ||||||||||||||
Repayments of debt obligation | $ 1,372,320 | ||||||||||||||
8% Promissory Notes [Member] | Tranche [Member] | |||||||||||||||
Debt instrument interest rate | 8.00% | ||||||||||||||
8% Promissory Notes [Member] | L2 Capital LLC [Member] | |||||||||||||||
Warrants issued | shares | 216,120 | ||||||||||||||
Exercise price of warrants | $ / shares | $ 1.30 | ||||||||||||||
Trading days | Tradingdays | 10 | ||||||||||||||
Warrant, description | The number of shares issuable under the warrant shall increase by the quotient of 50% of the face value of the respective tranche and 110% multiplied by the VWAP of the Company's common stock on the trading day immediately prior to the funding date of the respective tranche. | ||||||||||||||
8% Promissory Notes [Member] | L2 Capital LLC [Member] | Tranche 2 [Member] | |||||||||||||||
Debt instrument, face amount | $ 555,556 | ||||||||||||||
Purchase price | 500,000 | ||||||||||||||
Accretion of original issue discount | $ 55,556 | ||||||||||||||
Number of warrants exercisable | shares | 210,438 | ||||||||||||||
Exercise price of warrants | $ / shares | $ 1.20 | ||||||||||||||
8% Promissory Notes [Member] | Security Purchase Agreement [Member] | L2 Capital LLC [Member] | |||||||||||||||
Debt instrument, face amount | $ 1,681,668 | ||||||||||||||
Purchase price | $ 1,500,000 | ||||||||||||||
8% Promissory Notes [Member] | Security Purchase Agreement [Member] | L2 Capital LLC [Member] | Tranche 1 [Member] | |||||||||||||||
Debt instrument, face amount | $ 570,556 | ||||||||||||||
Purchase price | 500,000 | ||||||||||||||
Legal expenses | 15,000 | ||||||||||||||
Accretion of original issue discount | $ 70,556 | ||||||||||||||
8% Convertible Notes Payable [Member] | Tranche [Member] | |||||||||||||||
Debt, description | The 8% Promissory Notes required an increasing premium for any prepayment from 20% for the first 90 days to 38% after 181 days, an increased conversion rate to a 40% discount if in default, a default rate of 18% plus a repayment premium of 40%, plus 5% for each additional default, and liquidated damages in addition to the default rates, ranging from 30% to 100% for certain breaches of the 8% Promissory Notes, subject to mandatory prepayment, including the above described premiums, equal to 50% of new funds raised by the Company in excess of $11,600,000 in the private placement of its securities. | ||||||||||||||
New funds raised from private placement | $ 11,600,000 | ||||||||||||||
8% Promissory Notes [Member] | |||||||||||||||
Derivative liability | 15,000 | ||||||||||||||
10% Convertible Debenture [Member] | |||||||||||||||
Debt instrument, face amount | $ 4,775,000 | ||||||||||||||
Derivative liability | 471,002 | ||||||||||||||
Loss on extinguishment of debt | 1,042,000 | ||||||||||||||
Change in fair value of derivative liability | 570,998 | ||||||||||||||
Conversion of convertible shares | shares | 5,730 | ||||||||||||||
Value of convertible shares | $ 955,000 | ||||||||||||||
10% Convertible Debenture [Member] | Security Purchase Agreement [Member] | |||||||||||||||
Debt, description | The 10% Convertible Debentures were interest bearing at the rate of 10% per annum, that was payable in cash semi-annually on December 31 and June 30, beginning on December 31, 2018. Upon the occurrence of certain events, the holders of the 10% Convertible Debentures were also entitled to receive an additional payment, if necessary, to provide the holders with a 20% annual internal rate of return on their investment. The Company had the option, under certain circumstances, to redeem some or all of the outstanding principal amount for an amount equal to the principal amount (plus accrued but unpaid interest thereon) or the option to cause the holders to convert their debt at a certain conversion price, otherwise, the Company was not permitted to prepay any portion of the principal amount without the prior written consent of the debt holders. | ||||||||||||||
Liquidated damage, percentage | 6.00% | ||||||||||||||
Purchase agreement, description | The securities purchase agreement also included a provision that required the Company to maintain its periodic filings with the SEC in order to satisfy the public information requirements under Rule 144(c) of the Securities Act. If the Company failed for any reason to satisfy the current public information requirement, then the Company would have been obligated to pay to each holder a cash payment equal to 1.0% of the amount invested as partial Liquidated Damages, up to a maximum of six months. Such payments were subject to interest at the rate of 1.0% per month until paid in full. The 10% Convertible Debentures was rolled over into Series H Preferred Stock before the due date for the commencement of the Liquidated Damages. | ||||||||||||||
10% Convertible Debenture [Member] | Security Purchase Agreement [Member] | Common Stock [Member] | |||||||||||||||
Debt instrument interest rate | 10.00% | ||||||||||||||
Conversion of convertible shares | shares | 3,698,110 | ||||||||||||||
Conversion price | $ / shares | $ 1.2912 | ||||||||||||||
10% Convertible Debenture [Member] | Security Purchase Agreement [Member] | Four Accredited Investors [Member] | |||||||||||||||
Debt instrument, face amount | $ 4,775,000 | ||||||||||||||
10% Convertible Debenture [Member] | Security Purchase Agreement [Member] | Two Executives [Member] | |||||||||||||||
Debt instrument, face amount | $ 1,025,000 | ||||||||||||||
10% Senior Secured Convertible Debenture [Member] | |||||||||||||||
Debt instrument, face amount | 3,500,000 | ||||||||||||||
Purchase price | $ 3,285,000 | ||||||||||||||
Debt, description | On October 18, 2018, the Company entered into a securities purchase agreement with two accredited investors, B. Riley and an affiliated entity of B. Riley, pursuant to which the Company issued to the investors 10% original issue discount senior secured convertible debentures (the "10% OID Convertible Debentures" or referred to as the 10% original issue discount debentures) in the aggregate principal amount of $3,500,000, which, after taking into account the 5% original issue discount, and legal fees and expenses of the investors, resulted in the Company receiving net proceeds of $3,285,000. The Company issued warrants to the investors to purchase up to 875,000 shares of the Company's common stock in connection with this securities purchase agreement. The debt proceeds were bifurcated between the debt and warrants with the warrants accounted for as a derivative liability (see Note 17). The debentures were due and payable on October 31, 2019. Interest accrued on the debentures at the rate of 10% per annum, payable on the earlier of conversion, redemption or October 31, 2019. | ||||||||||||||
Warrant to purchase common stock | shares | 875,000 | ||||||||||||||
10% OID Convertible Debenture [Member] | |||||||||||||||
Derivative liability | $ 49,000 | ||||||||||||||
Loss on extinguishment of debt | 25,000 | ||||||||||||||
Change in fair value of derivative liability | 24,000 | ||||||||||||||
Debt issuance costs | $ 40,000 | ||||||||||||||
Conversion description | On December 12, 2018, there was a roll-over of the 10% OID Convertible Debentures into the 12% Convertible Debentures (as further described below) resulting in a loss on extinguishment of debt upon the roll-over which is presented in interest expense on the consolidated statements of operations. |
Convertible Debt - Schedule of
Convertible Debt - Schedule of Convertible Debt and Related Debt Components (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Add: accrued interest | $ 597,743 | |
Accretion of original issue discount | 69,596 | |
Loss on extinguishment of debt | (1,350,337) | |
8% Promissory Notes [Member] | ||
Accretion of original issue discount | 44,133 | |
Loss on extinguishment of debt | (292,201) | |
10% Convertible Debentures [Member] | ||
Accretion of original issue discount | ||
Loss on extinguishment of debt | (885,080) | |
10% OID Convertible Debentures [Member] | ||
Accretion of original issue discount | 25,463 | |
Loss on extinguishment of debt | (173,056) | |
Convertible Debt and Debt Components [Member] | ||
Principal amount of debt | 18,941,112 | |
Less: original issue discount | (286,112) | |
Less: issuance costs | (645,000) | |
Net cash proceeds received | 18,010,000 | |
Principal amount of debt (excluding original issue discount) | 18,655,000 | |
Add: conversion of debt from 10% OID Convertible Debentures | 3,551,528 | |
Add: accrued interest | 201,828 | |
Principal amount of debt including accrued interest | 22,408,356 | |
Debt discount: Allocated warrant derivative liabilities for B. Riley Warrants | (382,725) | |
Debt discount: Allocated warrant derivative liabilities for L2 Warrants | (600,986) | |
Debt discount: Allocated embedded derivative liabilities | (5,439,603) | |
Debt discount: Liquidated Damages recognized upon issuance | (706,944) | |
Debt discount: Issuance costs | (645,000) | |
Subtotal debt discount | (7,775,258) | |
Less: amortization of debt discount | 601,840 | |
Less: write off unamortized debt discount upon extinguishment of debt | 1,269,916 | |
Unamortized debt discount | (5,903,502) | |
Accretion of original issue discount | 69,596 | |
Loss on extinguishment of debt | 1,350,337 | |
Conversion of debt to 12% Convertible Debentures | (3,551,528) | |
Conversion of debt to Series H Preferred Stock | (5,730,000) | |
Repayment of convertible debt | (1,372,320) | |
Total debt components | (9,233,915) | |
Carrying amount at December 31, 2018 | 7,270,939 | |
Convertible Debt and Debt Components [Member] | 8% Promissory Notes [Member] | ||
Principal amount of debt | 1,126,112 | |
Less: original issue discount | (111,112) | |
Less: issuance costs | (15,000) | |
Net cash proceeds received | 1,000,000 | |
Principal amount of debt (excluding original issue discount) | 1,015,000 | |
Add: conversion of debt from 10% OID Convertible Debentures | ||
Add: accrued interest | 20,986 | |
Principal amount of debt including accrued interest | 1,035,986 | |
Debt discount: Allocated warrant derivative liabilities for B. Riley Warrants | ||
Debt discount: Allocated warrant derivative liabilities for L2 Warrants | (600,986) | |
Debt discount: Allocated embedded derivative liabilities | (159,601) | |
Debt discount: Issuance costs | (15,000) | |
Subtotal debt discount | (775,587) | |
Less: amortization of debt discount | 315,309 | |
Less: write off unamortized debt discount upon extinguishment of debt | 460,278 | |
Unamortized debt discount | ||
Accretion of original issue discount | 44,133 | |
Loss on extinguishment of debt | 292,201 | |
Conversion of debt to 12% Convertible Debentures | ||
Conversion of debt to Series H Preferred Stock | ||
Repayment of convertible debt | (1,372,320) | |
Total debt components | (1,035,986) | |
Carrying amount at December 31, 2018 | ||
Convertible Debt and Debt Components [Member] | 10% Convertible Debentures [Member] | ||
Principal amount of debt | 4,775,000 | |
Less: original issue discount | ||
Less: issuance costs | ||
Net cash proceeds received | 4,775,000 | |
Principal amount of debt (excluding original issue discount) | 4,775,000 | |
Add: conversion of debt from 10% OID Convertible Debentures | ||
Add: accrued interest | 69,920 | |
Principal amount of debt including accrued interest | 4,844,920 | |
Debt discount: Allocated warrant derivative liabilities for B. Riley Warrants | ||
Debt discount: Allocated warrant derivative liabilities for L2 Warrants | ||
Debt discount: Allocated embedded derivative liabilities | (471,002) | |
Debt discount: Issuance costs | ||
Subtotal debt discount | (471,002) | |
Less: amortization of debt discount | 64,452 | |
Less: write off unamortized debt discount upon extinguishment of debt | 406,550 | |
Unamortized debt discount | ||
Accretion of original issue discount | ||
Loss on extinguishment of debt | 885,080 | |
Conversion of debt to 12% Convertible Debentures | ||
Conversion of debt to Series H Preferred Stock | (5,730,000) | |
Repayment of convertible debt | ||
Total debt components | (4,844,920) | |
Carrying amount at December 31, 2018 | ||
Convertible Debt and Debt Components [Member] | 10% OID Convertible Debentures [Member] | ||
Principal amount of debt | 3,500,000 | |
Less: original issue discount | (175,000) | |
Less: issuance costs | (40,000) | |
Net cash proceeds received | 3,285,000 | |
Principal amount of debt (excluding original issue discount) | 3,325,000 | |
Add: conversion of debt from 10% OID Convertible Debentures | ||
Add: accrued interest | 28,009 | |
Principal amount of debt including accrued interest | 3,353,009 | |
Debt discount: Allocated warrant derivative liabilities for B. Riley Warrants | (382,725) | |
Debt discount: Allocated warrant derivative liabilities for L2 Warrants | ||
Debt discount: Allocated embedded derivative liabilities | (49,000) | |
Debt discount: Issuance costs | (40,000) | |
Subtotal debt discount | (471,725) | |
Less: amortization of debt discount | 68,637 | |
Less: write off unamortized debt discount upon extinguishment of debt | 403,088 | |
Unamortized debt discount | ||
Accretion of original issue discount | 25,463 | |
Loss on extinguishment of debt | 173,056 | |
Conversion of debt to 12% Convertible Debentures | (3,551,528) | |
Conversion of debt to Series H Preferred Stock | ||
Repayment of convertible debt | ||
Total debt components | (3,353,009) | |
Carrying amount at December 31, 2018 | ||
Convertible Debt and Debt Components [Member] | 12% Convertible Debenture [Member] | ||
Principal amount of debt | 9,540,000 | |
Less: original issue discount | ||
Less: issuance costs | (590,000) | |
Net cash proceeds received | 8,950,000 | |
Principal amount of debt (excluding original issue discount) | 9,540,000 | |
Add: conversion of debt from 10% OID Convertible Debentures | 3,551,528 | |
Add: accrued interest | 82,913 | |
Principal amount of debt including accrued interest | 13,174,441 | |
Debt discount: Allocated warrant derivative liabilities for B. Riley Warrants | ||
Debt discount: Allocated warrant derivative liabilities for L2 Warrants | ||
Debt discount: Allocated embedded derivative liabilities | (4,760,000) | |
Debt discount: Liquidated Damages recognized upon issuance | (706,944) | |
Debt discount: Issuance costs | (590,000) | |
Subtotal debt discount | (6,056,944) | |
Less: amortization of debt discount | 153,442 | |
Less: write off unamortized debt discount upon extinguishment of debt | ||
Unamortized debt discount | (5,903,502) | |
Accretion of original issue discount | ||
Loss on extinguishment of debt | ||
Conversion of debt to 12% Convertible Debentures | ||
Conversion of debt to Series H Preferred Stock | ||
Repayment of convertible debt | ||
Total debt components | ||
Carrying amount at December 31, 2018 | $ 7,270,939 |
Convertible Debt - Schedule o_2
Convertible Debt - Schedule of Convertible Debt and Related Debt Components (Details) (Parenthetical) | 12 Months Ended |
Dec. 31, 2018 | |
OID Convertible Debentures [Member] | |
Debt conversion percentage | 10.00% |
Convertible Debentures [Member] | |
Debt conversion percentage | 12.00% |
Convertible Debt - Schedule o_3
Convertible Debt - Schedule of Interest Expense (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Accretion of original issue discount | $ 69,596 | |
Amortization of debt discount | 601,840 | |
Loss on extinguishment of debt | 1,350,337 | |
Gain on extinguishment of embedded derivative liabilities upon extinguishment of host instrument | (1,096,860) | |
Write off unamortized debt discount upon extinguishment of debt | 1,269,916 | |
Accrued interest | 180,842 | |
Cash interest paid | 39,373 | |
Interest expenses, gross | 2,396,657 | |
Accrued interest on Officer Promissory Notes | 12,574 | |
Other interest | 99,643 | |
Total | 2,508,874 | |
8% Promissory Notes [Member] | ||
Accretion of original issue discount | 44,133 | |
Amortization of debt discount | 315,309 | |
Loss on extinguishment of debt | 292,201 | |
Gain on extinguishment of embedded derivative liabilities upon extinguishment of host instrument | (29,860) | |
Write off unamortized debt discount upon extinguishment of debt | 460,278 | |
Accrued interest | ||
Cash interest paid | 20,986 | |
Interest expenses, gross | 1,103,047 | |
10% Convertible Debentures [Member] | ||
Accretion of original issue discount | ||
Amortization of debt discount | 64,452 | |
Loss on extinguishment of debt | 885,080 | |
Gain on extinguishment of embedded derivative liabilities upon extinguishment of host instrument | (1,042,000) | |
Write off unamortized debt discount upon extinguishment of debt | 406,550 | |
Accrued interest | 69,920 | |
Cash interest paid | ||
Interest expenses, gross | 384,002 | |
10% OID Convertible Debentures [Member] | ||
Accretion of original issue discount | 25,463 | |
Amortization of debt discount | 68,637 | |
Loss on extinguishment of debt | 173,056 | |
Gain on extinguishment of embedded derivative liabilities upon extinguishment of host instrument | (25,000) | |
Write off unamortized debt discount upon extinguishment of debt | 403,088 | |
Accrued interest | 28,009 | |
Cash interest paid | ||
Interest expenses, gross | 673,253 | |
12% Convertible Debentures [Member] | ||
Accretion of original issue discount | ||
Amortization of debt discount | 153,442 | |
Loss on extinguishment of debt | ||
Gain on extinguishment of embedded derivative liabilities upon extinguishment of host instrument | ||
Write off unamortized debt discount upon extinguishment of debt | ||
Accrued interest | 82,913 | |
Cash interest paid | ||
Interest expenses, gross | $ 236,355 |
Preferred Stock (Details Narrat
Preferred Stock (Details Narrative) - USD ($) | Aug. 10, 2018 | Jun. 15, 2018 | Nov. 30, 2001 | May 30, 2000 | Dec. 31, 2018 | Dec. 31, 2017 |
Preferred stock, shares authorized | 1,000,000 | |||||
Preferred stock par value | $ 0.01 | |||||
Conversion price | $ 0.33 | |||||
Cash fee paid | $ 575,000 | |||||
Stock issuance cost | $ 159,208 | |||||
Common stock trading price | $ 0.86 | |||||
Beneficial conversion feature | $ 18,045,496 | |||||
Previously Paid Retainer [Member] | ||||||
Cash fee paid | $ 75,000 | |||||
Security Purchase Agreement [Member] | ||||||
Liquidated damages, description | The registration rights agreement provides for a cash payment equal to 1.0% per month of the amount invested as partial liquidated damages upon the occurrence of certain events, on each monthly anniversary, payable within 7 days of such event, up to a maximum amount of 6.0% of the aggregate amount invested, subject to interest at 12.0% per annum, accruing daily, until paid in full. | |||||
Maximum liquidated damages percentage | 6.00% | |||||
Agreement description | If the Company fails for any reason to satisfy the current public information requirement commencing from the six (6) month anniversary date of the closing of the Series H Preferred Stock, then the Company will be obligated to pay to each holder a cash payment equal to 1.0% of the aggregate amount invested for each 30-day period, or pro rata portion thereof, as partial liquidated damages per month, up to a maximum of 6 months, subject to interest at the rate of 1.0% per month until paid in full. | |||||
Liquidating damages payable | $ 1,404,463 | |||||
Common Stock [Member] | ||||||
Number of shares converted | 1,632 | |||||
Number of shares issued during period for services | 281,565 | |||||
Series A Through E [Member] | ||||||
Preferred stock, designated shares | 10,270 | |||||
Series F Convertible Preferred Stock [Member] | ||||||
Preferred stock, designated shares | 2,000 | |||||
Series G Preferred Stock [Member] | ||||||
Preferred stock, designated shares | 1,800 | |||||
Shares outstanding | 168.496 | |||||
Sale of stock | 1,800 | |||||
Maturity date, description | Expired on November 29, 2003 | |||||
Preferred stock, value | $ 1,000 | $ 1,000 | ||||
Conversion of stock, description | The Series G Preferred Stock was initially convertible into common stock at a conversion price equal to 85% of the lowest sale price of the common stock over the five trading days preceding the date of the conversion, subject to a maximum conversion price of $16.30, adjusted for a 1-for-10 reverse stock split effective July 26, 2007. | |||||
Reverse stock split | 1-for-10 | |||||
Preferred stock, value outstanding | $ 168 | |||||
Series G Preferred Stock [Member] | Maximum [Member] | ||||||
Conversion price | $ 16.30 | |||||
Series G Preferred Stock [Member] | Four Investors [Member] | ||||||
Number of warrants to purchase shares of common stock | 63,000 | |||||
Series G Preferred Stock [Member] | Original Investor [Member] | ||||||
Shares outstanding | 168.496 | |||||
Series H Preferred Stock [Member] | ||||||
Preferred stock, designated shares | 23,000 | |||||
Shares outstanding | 19,400 | |||||
Preferred stock, value | $ 1,000 | |||||
Conversion price | $ 0.33 | |||||
Number of shares converted | 58,785,606 | |||||
Preferred stock, shares issued | 5,730 | 19,400 | ||||
Number of shares converted, value | $ 19,399,250 | $ 4,775,000 | ||||
Prepayment obligations | 955,000 | |||||
Debt instrument, face amount | $ 5,730,000 | |||||
Debt instrument interest rate | 10.00% | |||||
Number of shares issued during period for services | 5,592 | |||||
Number of shares purchased during period | 1,000,000 | |||||
Stock issuance cost | $ 1,194,546 | |||||
Series H Preferred Stock [Member] | Securities Purchase Agreement [Member] | ||||||
Preferred stock, value | $ 1,000 | |||||
Preferred stock, shares issued | 19,400 | |||||
Series H Preferred Stock [Member] | Chief Executive Officer [Member] | ||||||
Number of shares issued during period for services | 1,200 | |||||
Series H Preferred Stock [Member] | President [Member] | ||||||
Number of shares issued during period for services | 30 | |||||
Series H Preferred Stock [Member] | B. Riley [Member] | ||||||
Preferred stock par value | $ 1,000 | |||||
Number of shares issued during period for services | 669 |
Preferred Stock - Schedule of C
Preferred Stock - Schedule of Components of Series H Preferred Stock (Details) - USD ($) | Oct. 31, 2016 | Aug. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 |
Issuance of Series H Preferred Stock on August 10, 2018. shares | 307,475 | 12,209,677 | ||
Net cash proceeds from issuance of Series H Preferred Stock | $ 12,474,704 | |||
Series H Preferred Stock [Member] | ||||
Issuance of Series H Preferred Stock on August 10, 2018 | $ 19,400 | |||
Issuance of Series H Preferred Stock on August 10, 2018. shares | 19,399.25 | |||
Less: shares issued to B. Riley FBR as placement fee | $ (669,250) | |||
Less: shares issued to B. Riley FBR as placement fee, shares | (670) | |||
Less: shares issued for conversion of principal of 10% Convertible Debentures | $ (4,775,000) | |||
Less: shares issued for conversion of principal of 10% Convertible Debentures, shares | (4,775) | |||
Less: shares issued to 10% Convertible Debenture holders for additional payment of 20% annual internal rate of return | $ (955,000) | |||
Less: shares issued to 10% Convertible Debenture holders for additional payment of 20% annual internal rate of return, shares | (955) | |||
Net issuance of Series H Preferred Stock | $ 13,000,000 | |||
Net issuance of Series H Preferred Stock, shares | 13,000 | |||
Payments made to B. Riley FBR from proceeds: Less: placement fee | $ (500,000) | |||
Payments made to B. Riley FBR from proceeds: Less: legal fees and other costs | (25,296) | |||
Total payments made from proceeds | (525,296) | |||
Net cash proceeds from issuance of Series H Preferred Stock | 12,474,704 | |||
Issuance of Series H Preferred Stock | 19,399,250 | |||
Less issuance costs: Shares issued to B. Riley FBR as placement fee | (669,250) | |||
Less issuance costs: Total payments made from proceeds | (525,296) | |||
Less issuance costs: Legal and other costs paid in cash | (159,208) | |||
Total issuance costs | (1,353,754) | |||
Beneficial conversion feature on Series H Preferred Stock | $ 18,045,496 |
Preferred Stock - Schedule of_2
Preferred Stock - Schedule of Components of Series H Preferred Stock (Details) (Parenthetical) - Series H Preferred Stock [Member] | 12 Months Ended |
Dec. 31, 2018 | |
Debt conversion percentage | 10.00% |
Annual internal rate of return | 20.00% |
Stockholders' Equity (Details N
Stockholders' Equity (Details Narrative) | Dec. 20, 2018USD ($) | Dec. 12, 2018shares | Dec. 12, 2018shares | Oct. 18, 2018$ / sharesshares | Oct. 02, 2018shares | Sep. 13, 2018shares | Aug. 23, 2018$ / sharesshares | Jun. 15, 2018$ / sharesshares | Jun. 15, 2018$ / sharesshares | Mar. 30, 2018USD ($)$ / sharesshares | Jan. 04, 2018USD ($)$ / sharesshares | Jan. 04, 2018$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares | Oct. 19, 2017USD ($)$ / sharesshares | Apr. 04, 2017USD ($)$ / sharesshares | Nov. 04, 2016$ / sharesshares | Oct. 31, 2016shares | Aug. 31, 2016USD ($)shares | Jan. 31, 2019shares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares | Aug. 03, 2018$ / sharesshares | Aug. 11, 2016$ / shares |
Stock options granted | 8,187,750 | ||||||||||||||||||||||
Common stock authorized | 1,000,000,000 | 1,000,000,000 | 1,000,000,000 | ||||||||||||||||||||
Common stock par value | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | ||||||||||||||||||||
Number of shares issued during period, shares | 307,475 | 12,209,677 | |||||||||||||||||||||
Proceeds from private placement | $ | $ 1,250,000 | $ 6,254,946 | |||||||||||||||||||||
Warrant exercise price | $ / shares | $ 0.20 | $ 0.50 | |||||||||||||||||||||
Payment on buy back shares | $ | $ 2,952 | ||||||||||||||||||||||
Per share on buy back shares | $ / shares | $ 0.0002 | ||||||||||||||||||||||
Number of shares related to performance | 2,453,362 | ||||||||||||||||||||||
Recapitalization number of shares transfer to escrow account subject to buy back right | 1,927,641 | 1,927,641 | |||||||||||||||||||||
Incremental compensation cost | $ | $ 2,756,527 | ||||||||||||||||||||||
Stock option expiration date | May 15, 2019 | ||||||||||||||||||||||
Restricted stock awards not yet recognized | $ | $ 3,927,443 | ||||||||||||||||||||||
Stock based compensation costs | $ | 4,340,824 | $ 1,625,687 | |||||||||||||||||||||
Derivative liability | $ | $ 1,344,648 | ||||||||||||||||||||||
Warrant expiration term | 5 years | ||||||||||||||||||||||
Number of anti-dilutive common stock shares | 82,897,246 | 11,847,935 | |||||||||||||||||||||
Warrant exercisable price | $ / shares | $ 0.50 | ||||||||||||||||||||||
Intrinsic value of exercisable stock option | $ | $ 1,573,000 | $ 1,573,000 | $ 1,573,000 | ||||||||||||||||||||
Fair market value of stock option | $ / shares | $ 0.48 | ||||||||||||||||||||||
Reserve [Member] | |||||||||||||||||||||||
Number of anti-dilutive common stock shares | 3,200,889 | ||||||||||||||||||||||
Hub Pages Inc [Member] | |||||||||||||||||||||||
Common stock par value | $ / shares | $ 2.50 | ||||||||||||||||||||||
Number of shares issued during period, shares | 2,400,000 | 2,399,997 | |||||||||||||||||||||
Stock option expiration date | Sep. 23, 2021 | ||||||||||||||||||||||
Stock option vesting description | The true-up period, in general, is 13 months after the consummation of the HubPages Merger until 90 days following completion of vesting, or July 30, 2021. The restricted stock awards were fair valued upon issuance by an independent appraisal firm. | ||||||||||||||||||||||
Common Stock to be Issued [Member] | |||||||||||||||||||||||
Number of shares issued during period, shares | 5,067,167 | ||||||||||||||||||||||
Incremental compensation cost | $ | |||||||||||||||||||||||
MDB Warrants [Member] | |||||||||||||||||||||||
Warrant to purchase common stock | 1,169,607 | ||||||||||||||||||||||
Warrant exercise price | $ / shares | $ 0.20 | ||||||||||||||||||||||
Number of warrant exercised under cashless exercise | 842,117 | ||||||||||||||||||||||
Warrant outstanding | 327,490 | ||||||||||||||||||||||
MDB Warrants [Member] | |||||||||||||||||||||||
Warrant outstanding | 507,055 | ||||||||||||||||||||||
L2 Warrants [Member] | |||||||||||||||||||||||
Warrant to purchase common stock | 640,405 | ||||||||||||||||||||||
Common stock par value | $ / shares | $ 0.50 | ||||||||||||||||||||||
Warrant exercise price | $ / shares | $ 0.50 | ||||||||||||||||||||||
Warrant [Member] | |||||||||||||||||||||||
Derivative liability | $ | $ 418,214 | ||||||||||||||||||||||
Strome Warrant [Member] | |||||||||||||||||||||||
Derivative liability | $ | 587,971 | ||||||||||||||||||||||
Money Stock Warrants [Member] | |||||||||||||||||||||||
Fair value of warrants | $ | $ 92,000 | ||||||||||||||||||||||
Warrant exercise price | $ / shares | $ 0.48 | ||||||||||||||||||||||
January 4, 2018 [Member] | |||||||||||||||||||||||
Liquidation damages description | The amount of liquidated damages payable to Strom or MDB is 1.0% of the aggregate amount invested for each 30-day period, or pro rata portion thereof, during which the default continues, up to a maximum amount of 5.0% of the aggregate amount invested or the value of the securities registered by the placement agent. The purchaser of the shares of common stock waived the liquidated damages when the purchaser converted certain notes payable into Series H Preferred Stock in August 2018 (see Note 23) The Company recognized Liquidated Damages for the year ended December 31, 2018, with respect to its registration rights agreement for the common stock issued to MDB in conjunction with the January 4, 2018 private placement | ||||||||||||||||||||||
March 30, 2018 [Member] | |||||||||||||||||||||||
Liquidation damages description | The amount of liquidated damages payable to the investor is 1.0% of the aggregate amount invested for each 30-day period, or pro rata portion thereof, during which the default continues, up to a maximum amount of 5.0% of the aggregate amount invested. The purchaser of the shares of common stock waived the liquidated damages when the purchaser converted certain notes payable into Series H Preferred Stock in August 2018 (see Note 13). | ||||||||||||||||||||||
Restricted Stock [Member] | |||||||||||||||||||||||
Stock options granted | 4,606,503 | ||||||||||||||||||||||
Cost recognized over a period | $ | $ 2,148,811 | ||||||||||||||||||||||
Restricted stock awards not yet recognized | $ | $ 3,927,443 | ||||||||||||||||||||||
Stock recognized over period | 1 year 11 months 8 days | ||||||||||||||||||||||
Stock based compensation costs | $ | $ 43,750 | ||||||||||||||||||||||
Forfeited unvested restricted stock | 329,735 | 329,735 | |||||||||||||||||||||
Restricted Stock [Member] | Hub Pages Inc [Member] | |||||||||||||||||||||||
Number of restricted common stock, shares | 2,399,997 | ||||||||||||||||||||||
April 30, 2018 [Member] | Strome Warrant [Member] | |||||||||||||||||||||||
Warrant to purchase common stock | 2,478,359 | ||||||||||||||||||||||
Number of shares issued during period, shares | 736,853 | ||||||||||||||||||||||
Warrant exercise price | $ / shares | $ 1.60 | ||||||||||||||||||||||
Number of warrant exercised under cashless exercise | 842,117 | ||||||||||||||||||||||
Private Placement [Member] | MDB Warrants [Member] | |||||||||||||||||||||||
Warrant to purchase common stock | 60,000 | 60,000 | 119,565 | ||||||||||||||||||||
Warrant exercise price | $ / shares | $ 2.50 | $ 2.50 | $ 1.15 | ||||||||||||||||||||
Warrant expiration term | 5 years | ||||||||||||||||||||||
Private Placement [Member] | March 30, 2018 [Member] | Strome Warrant [Member] | |||||||||||||||||||||||
Warrant to purchase common stock | 1,700,000 | 1,700,000 | |||||||||||||||||||||
Warrant exercise price | $ / shares | $ 2.50 | $ 2.50 | |||||||||||||||||||||
Maximum number of shares issuable in transaction | 3,400,000 | ||||||||||||||||||||||
Warrant exercisable price | $ / shares | $ 1.25 | $ 1.25 | |||||||||||||||||||||
Investors [Member] | B. Riley Warrants [Member] | |||||||||||||||||||||||
Derivative liability | $ | $ 358,050 | ||||||||||||||||||||||
Investors [Member] | B. Riley Warrants [Member] | 10% OID Convertible Debentures [Member] | |||||||||||||||||||||||
Warrant to purchase common stock | 875,000 | ||||||||||||||||||||||
Warrant exercise price | $ / shares | $ 1 | ||||||||||||||||||||||
Warrant expiration term | 7 years | ||||||||||||||||||||||
Warrant description | The warrant instrument provides that upon the consummation of a subsequent financing, the $1.00 exercise price shall be adjusted to (i), in the event that security issued in such subsequent financing is common stock, 125% of the effective per share purchase price of the common stock in such subsequent financing, (ii), in the event that the security issued in such subsequent financing is a common stock equivalent, 100% of the effective per share purchase price of the common stock underlying the common stock equivalent issued in such subsequent financing, or (iii), in the event that the primary securities issued such subsequent financing includes a combination of common stock and common stock equivalents, the greater of (a) 125% of the effective per share purchase price of the common stock issued in such subsequent financing or (b) 100% of the effective per share purchase price of the common stock underlying the common stock equivalents. | ||||||||||||||||||||||
Investors [Member] | Private Placement [Member] | |||||||||||||||||||||||
Number of shares issued during period, shares | 500,000 | ||||||||||||||||||||||
Shares issued price per share | $ / shares | $ 2.50 | ||||||||||||||||||||||
Proceeds from private placement | $ | $ 1,250,000 | ||||||||||||||||||||||
Board of Directors [Member] | |||||||||||||||||||||||
Number of shares issued during period, shares | 206,506 | ||||||||||||||||||||||
Board of Directors [Member] | Restricted Stock [Member] | |||||||||||||||||||||||
Number of restricted common stock, shares | 57,693 | 148,813 | |||||||||||||||||||||
Vesting term | 3 months | 4 months | |||||||||||||||||||||
Security Purchase Agreement [Member] | Strome Warrant [Member] | |||||||||||||||||||||||
Warrant to purchase common stock | 1,500,000 | 1,500,000 | |||||||||||||||||||||
Number of shares issued during period, shares | 1,700,000 | ||||||||||||||||||||||
Warrant exercise price | $ / shares | $ 1.19 | $ 1.19 | |||||||||||||||||||||
Warrant expiration term | 5 years | 5 years | |||||||||||||||||||||
Integrated Surgical Systems, Inc and Amplify Media Network, Inc [Member] | Share Exchange Agreement [Member] | |||||||||||||||||||||||
Recapitalization exchange ratio | 4.13607 | ||||||||||||||||||||||
Amplify Media Network, Inc [Member] | |||||||||||||||||||||||
Stock issued during period, value, restricted stock award, gross | 12,517,152 | ||||||||||||||||||||||
MDB Capital Group LLC [Member] | |||||||||||||||||||||||
Warrant to purchase common stock | 60,000 | 60,000 | 1,169,607 | ||||||||||||||||||||
Stock options granted | 175,000 | ||||||||||||||||||||||
Number of shares issued during period, shares | 1,200,000 | 2,391,304 | 3,765,000 | ||||||||||||||||||||
Shares issued price per share | $ / shares | $ 2.50 | $ 2.50 | $ 1.15 | $ 1 | |||||||||||||||||||
Number of shares issued during period, value | $ | $ 3,000,000 | $ 2,750,000 | $ 3,765,000 | ||||||||||||||||||||
Proceeds from private placement | $ | $ 188,250 | ||||||||||||||||||||||
Stock issued during period, shares, issued for services | 60,000 | 119,565 | 162,000 | ||||||||||||||||||||
Warrants to purchase shares of common stock | 60,000 | 60,000 | 119,565 | ||||||||||||||||||||
Fair value of warrants | $ | $ 126,286 | ||||||||||||||||||||||
Warrants issued | 60,000 | 60,000 | |||||||||||||||||||||
Warrant exercise price | $ / shares | $ 2.50 | $ 2.50 | |||||||||||||||||||||
MDB Capital Group LLC [Member] | Private Placement [Member] | |||||||||||||||||||||||
Shares issued price per share | $ / shares | $ 2.50 | 2.50 | |||||||||||||||||||||
Number of common shares sold | 60,000 | ||||||||||||||||||||||
Number of common shares sold, value | $ | $ 150,000 | ||||||||||||||||||||||
Strome Mezzanine Fund LP [Member] | Investors [Member] | Private Placement [Member] | |||||||||||||||||||||||
Number of shares issued during period, shares | 1,200,000 | ||||||||||||||||||||||
Shares issued price per share | $ / shares | $ 2.50 | $ 2.50 | |||||||||||||||||||||
Proceeds from private placement | $ | $ 3,000,000 | ||||||||||||||||||||||
Say Media, Inc. [Member] | |||||||||||||||||||||||
Number of shares issued during period, shares | 432,835 | 5,500,002 | |||||||||||||||||||||
Say Media, Inc. [Member] | Restricted Stock [Member] | |||||||||||||||||||||||
Number of restricted common stock, shares | 2,000,000 | ||||||||||||||||||||||
Stock option vesting description | The shares vest one-third on the first anniversary date of issuance and then over twenty-four equal monthly installments after the first anniversary date and the estimated fair value of these shares is being recognized as compensation expense over the vesting period of the award. |
Stockholders' Equity - Summary
Stockholders' Equity - Summary of Restricted Stock Award Activity (Details) | 12 Months Ended |
Dec. 31, 2018$ / sharesshares | |
Number of shares Restricted stock awards outstanding, non-vested at beginning | |
Number of shares, non-vested Issued | 8,187,750 |
Number of shares, non-vested Vested | (175,000) |
Number of shares Restricted stock awards outstanding, non-vested at ending | 7,552,355 |
Number of Shares Common stock options, outstanding at Beginning balance | 2,176,637 |
Number of shares, Forfeited | 732,353 |
Number of Shares Common stock options, outstanding at Ending balance | 9,405,541 |
Restricted Stock [Member] | |
Number of shares Restricted stock awards outstanding, non-vested at beginning | 6,979,596 |
Number of shares, non-vested Issued | 4,606,503 |
Number of shares, non-vested Vested | (4,946,490) |
Number of shares, non-vested Forfeited | (329,735) |
Number of shares Restricted stock awards outstanding, non-vested at ending | 6,309,874 |
Number of Shares Common stock options, outstanding at Beginning balance | 5,537,556 |
Number of shares, Issued | |
Number of shares, Vested | (4,946,490) |
Number of shares, Forfeited | |
Number of Shares Common stock options, outstanding at Ending balance | 10,484,046 |
Weighted Average price Grant-Date, beginning | $ / shares | $ 0.41 |
Weighted Average price Grant-Date, Issued | $ / shares | 0.72 |
Weighted Average price Grant-Date, Vested | $ / shares | |
Weighted Average price Grant-Date, Forfeited | $ / shares | |
Weighted Average price Grant-Date, ending | $ / shares | $ 0.50 |
Stockholders' Equity - Summar_2
Stockholders' Equity - Summary of Warrant Activity (Details) - $ / shares | Aug. 03, 2018 | Dec. 31, 2018 |
Number of Shares, Exercisable at end of year | 3,949,018 | |
Common Stock Financing Warrant [Member] | ||
Number of Shares, outstanding, at beginning of year | 1,289,172 | |
Number of Shares, Issued | 2,861,558 | |
Number of Shares, Exercised | (842,117) | |
Number of Shares, Issued as result of the reset provision on August 3, 2018 | 640,405 | |
Number of Shares, outstanding at end of year | 3,949,018 | |
Number of Shares, Exercisable at end of year | 3,949,018 | |
Weighted Average Exercise Price, outstanding, at beginning of year | $ 0.29 | |
Weighted Average Exercise Price, Issued | 1.17 | |
Weighted Average Exercise Price, Exercised | 0.20 | |
Weighted Average Exercise Prices, Issued as result of the reset provision on August 3, 2018 | $ 0.50 | |
Weighted Average Exercise Price, outstanding, at end of year | 0.64 | |
Weighted Average Exercise Price, Exercisable at end of year | $ 0.64 | |
Weighted Average Remaining Contractual Life, Outstanding at end of year | 4 years 9 months 18 days | |
Weighted Average Remaining Contractual Life, Exercisable at end of year | 4 years 9 months 18 days |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Common Stock Financing Warrants Outstanding and Exercisable (Details) | 12 Months Ended |
Dec. 31, 2018$ / sharesshares | |
Financing Warrants Classified as Derivative Liabilities (Shares) | 3,441,963 |
Financing Warrants Classified within Stockholders' Equity (Shares) | 507,055 |
Total Exercisable Financing Warrants (Shares) | 3,949,018 |
Total outstanding and exercisable | 3,949,018 |
L2 Warrant reserve | 2,133,926 |
Total outstanding, exercisable and reserved | 6,082,944 |
MDB Warrants [Member] | |
Financing Warrants Exercise Price | $ / shares | $ 0.20 |
Financing Warrants Expiration Date | Nov. 4, 2021 |
Financing Warrants Classified as Derivative Liabilities (Shares) | |
Financing Warrants Classified within Stockholders' Equity (Shares) | 327,490 |
Total Exercisable Financing Warrants (Shares) | 327,490 |
L2 Warrants [Member] | |
Financing Warrants Exercise Price | $ / shares | $ 0.50 |
Financing Warrants Expiration Date | Aug. 3, 2023 |
Financing Warrants Classified as Derivative Liabilities (Shares) | 1,066,963 |
Financing Warrants Classified within Stockholders' Equity (Shares) | |
Total Exercisable Financing Warrants (Shares) | 1,066,963 |
Strome Warrants [Member] | |
Financing Warrants Exercise Price | $ / shares | $ 0.50 |
Financing Warrants Expiration Date | Jun. 15, 2023 |
Financing Warrants Classified as Derivative Liabilities (Shares) | 1,500,000 |
Financing Warrants Classified within Stockholders' Equity (Shares) | |
Total Exercisable Financing Warrants (Shares) | 1,500,000 |
B. Riley Warrants [Member] | |
Financing Warrants Exercise Price | $ / shares | $ 1 |
Financing Warrants Expiration Date | Oct. 18, 2025 |
Financing Warrants Classified as Derivative Liabilities (Shares) | 875,000 |
Financing Warrants Classified within Stockholders' Equity (Shares) | |
Total Exercisable Financing Warrants (Shares) | 875,000 |
MDB Warrants One [Member] | |
Financing Warrants Exercise Price | $ / shares | $ 1.15 |
Financing Warrants Expiration Date | Oct. 19, 2022 |
Financing Warrants Classified as Derivative Liabilities (Shares) | |
Financing Warrants Classified within Stockholders' Equity (Shares) | 119,565 |
Total Exercisable Financing Warrants (Shares) | 119,565 |
MDB Warrants Two [Member] | |
Financing Warrants Exercise Price | $ / shares | $ 2.50 |
Financing Warrants Expiration Date | Oct. 19, 2022 |
Financing Warrants Classified as Derivative Liabilities (Shares) | |
Financing Warrants Classified within Stockholders' Equity (Shares) | 60,000 |
Total Exercisable Financing Warrants (Shares) | 60,000 |
Financing Warrants Classified as Derivative Liabilities [Member] | |
Total outstanding and exercisable | 3,441,963 |
L2 Warrant reserve | 2,133,926 |
Total outstanding, exercisable and reserved | 5,575,889 |
Financing Warrants Classified Within Stockholders' Equity [Member] | |
Total outstanding and exercisable | 507,055 |
L2 Warrant reserve | |
Total outstanding, exercisable and reserved | 507,055 |
Stock Based Compensation (Detai
Stock Based Compensation (Details Narrative) - USD ($) | Dec. 13, 2018 | Dec. 12, 2018 | Nov. 02, 2018 | Oct. 31, 2016 | Aug. 31, 2016 | Dec. 31, 2018 | Aug. 31, 2018 | Mar. 28, 2018 | Dec. 31, 2017 |
Number of Shares Common stock options, Granted | 8,187,750 | ||||||||
Grant date fair value of stock options granted | 5,566,385 | ||||||||
Intrinsic value of stock option | $ 1,573,000 | $ 1,573,000 | |||||||
Number of shares fully vested | 175,000 | ||||||||
Exercise price of stock option | $ 0.17 | ||||||||
Stock option expiration date | May 15, 2019 | ||||||||
Number of shares issued during period, shares | 307,475 | 12,209,677 | |||||||
Number of outstanding stock options not vested | 7,552,355 | ||||||||
Unrecognized compensation expense related to stock options granted | $ 4,338,362 | ||||||||
Weighted-average period of options term | 9 years 2 months 30 days | ||||||||
Fair market value of stock option | $ 0.48 | ||||||||
Warrant vesting term | 3 years | ||||||||
Warrant expiration term | 5 years | ||||||||
Exercise price upper range | $ 1.32 | ||||||||
Exercise price lower range | $ 2.25 | ||||||||
Common Stock [Member] | |||||||||
Number of Shares Common stock options, Granted | 700,000 | 360,000 | |||||||
Number of shares fully vested | 1,000,000 | 354,000 | |||||||
Channel Partner Warrants [Member] | |||||||||
Grant date fair value of stock options granted | 2,000,000 | ||||||||
Common stock warrant issued | 4,215,500 | ||||||||
Warrant to purchase common stock | 982,860 | ||||||||
Exercise price lower range | $ 0.48 | ||||||||
Unexercised in-the-Money [Member] | |||||||||
Intrinsic value of stock option | $ 7,750 | ||||||||
Fair market value of stock option | $ 0.48 | ||||||||
June 2018 [Member] | |||||||||
Number of shares fully vested | 125,000 | ||||||||
Number of shares issued during period, shares | 106,154 | ||||||||
2016 Stock Incentive Plan [Member] | |||||||||
Number of Shares Common stock options, Granted | 9,405,541 | ||||||||
Number of shares available for future grant | 594,459 | ||||||||
2016 Stock Incentive Plan [Member] | Minimum [Member] | |||||||||
Common stock reserved for grant | 5,000,000 | 3,000,000 | |||||||
2016 Stock Incentive Plan [Member] | Maximum [Member] | |||||||||
Common stock reserved for grant | 10,000,000 | 5,000,000 | |||||||
Stock Options Outside 2016 Plan [Member] | |||||||||
Number of Shares Common stock options, Granted | 2,414,000 | ||||||||
Grant date fair value of stock options granted | 755,884 | ||||||||
Intrinsic value of stock option | $ 277,820 | ||||||||
Unrecognized compensation expense related to stock options granted | $ 733,875 | ||||||||
Weighted-average period of options term | 2 years 11 months 1 day |
Stock Based Compensation - Sche
Stock Based Compensation - Schedule of Fair Value of Stock Options Assumptions (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Risk-free interest rate, minimum | 2.27% |
Risk-free interest rate, maximum | 3.05% |
Expected dividend yield | 0.00% |
Expected volatility, minimum | 108.34% |
Expected volatility, maximum | 139.36% |
Stock Options Outside 2016 Plan [Member] | |
Risk-free interest rate, minimum | 2.79% |
Risk-free interest rate, maximum | 3.09% |
Expected dividend yield | 0.00% |
Expected volatility, minimum | 113.49% |
Expected volatility, maximum | 116.86% |
Expected life | 6 years |
Minimum [Member] | |
Expected life | 3 years |
Maximum [Member] | |
Expected life | 6 years |
Stock Based Compensation - Summ
Stock Based Compensation - Summary of Stock Option Activity (Details) | 12 Months Ended |
Dec. 31, 2018$ / sharesshares | |
Number of Shares Common stock options, outstanding at Beginning balance | shares | 2,176,637 |
Number of Shares Common stock options, Granted | shares | 8,187,750 |
Number of Shares Common stock options, Exercised | shares | (125,000) |
Number of Shares Common stock options, Forfeited | shares | (732,353) |
Number of Shares Common stock options, Expired | shares | (101,493) |
Number of Shares Common stock options, outstanding at Ending balance | shares | 9,405,541 |
Number of Shares Common stock options, exercisable at Ending balance | shares | 1,853,186 |
Weighted Average Exercise Price, outstanding at Beginning balance | $ 1.25 |
Weighted Average Exercise Price, Granted | 0.84 |
Weighted Average Exercise Price, Exercised | 0.17 |
Weighted Average Exercise Price, Forfeited | 1.41 |
Weighted Average Exercise Price, Expired | 1.49 |
Weighted Average Exercise Price, outstanding at Beginning balance | 0.61 |
Weighted Average Exercise Price, exercisable at Beginning balance | $ 1.14 |
Weighted Average Remaining Contractual Life (in Years), outstanding at Beginning balance | 9 years 2 months 30 days |
Weighted Average Remaining Contractual Life (in Years), outstanding at Ending balance | 9 years 3 months 19 days |
Weighted Average Remaining Contractual Life (in Years), exercisable at Ending balance | 8 years 9 months 7 days |
Stock Options Outside 2016 Plan [Member] | |
Number of Shares Common stock options, outstanding at Beginning balance | shares | |
Number of Shares Common stock options, Granted | shares | 2,414,000 |
Number of Shares Common stock options, outstanding at Ending balance | shares | 2,414,000 |
Weighted Average Exercise Price, outstanding at Beginning balance | |
Weighted Average Exercise Price, Granted | 0.36 |
Weighted Average Exercise Price, outstanding at Beginning balance | 0.36 |
Weighted Average Exercise Price, exercisable at Beginning balance | |
Weighted Average Remaining Contractual Life (in Years), outstanding at Beginning balance | 2 years 11 months 1 day |
Weighted Average Remaining Contractual Life (in Years), outstanding at Ending balance | 9 years 11 months 8 days |
Stock Based Compensation - Sc_2
Stock Based Compensation - Schedule of Exercise Prices of Common Stock Options (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Exercise price lower range | $ 2.25 | |
Exercise price upper range | $ 1.32 | |
Number of Shares, Outstanding | 9,405,541 | 2,176,637 |
Number of Shares, Exercisable | 1,853,186 | |
Exercise Price Range One [Member] | ||
Exercise price upper range | $ 1 | |
Number of Shares, Outstanding | 6,093,500 | |
Number of Shares, Exercisable | 516,333 | |
Exercise Price Range Two [Member] | ||
Exercise price lower range | $ 1.01 | |
Exercise price upper range | $ 1.25 | |
Number of Shares, Outstanding | 1,707,482 | |
Number of Shares, Exercisable | 921,946 | |
Exercise Price Range Three [Member] | ||
Exercise price lower range | $ 1.26 | |
Exercise price upper range | $ 1.50 | |
Number of Shares, Outstanding | 28,309 | |
Number of Shares, Exercisable | 7,198 | |
Exercise Price Range Four [Member] | ||
Exercise price lower range | $ 1.51 | |
Exercise price upper range | $ 1.75 | |
Number of Shares, Outstanding | 345,000 | |
Number of Shares, Exercisable | 108,542 | |
Exercise Price Range Five [Member] | ||
Exercise price lower range | $ 1.76 | |
Exercise price upper range | $ 2 | |
Number of Shares, Outstanding | 1,055,000 | |
Number of Shares, Exercisable | 252,500 | |
Exercise Price Range Six [Member] | ||
Exercise price lower range | $ 2.01 | |
Exercise price upper range | $ 2.25 | |
Number of Shares, Outstanding | 135,000 | |
Number of Shares, Exercisable | 5,417 | |
Exercise Price Range Seven [Member] | ||
Exercise price lower range | $ 2.26 | |
Exercise price upper range | $ 2.50 | |
Number of Shares, Outstanding | 41,250 | |
Number of Shares, Exercisable | 41,250 |
Stock Based Compensation - Sc_3
Stock Based Compensation - Schedule of Warrants Assumptions (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Measurement Input, Risk Free Interest Rate [Member] | Minimum [Member] | |
Fair value assumptions, measurement input, percentages | 2.53% |
Measurement Input, Risk Free Interest Rate [Member] | Maximum [Member] | |
Fair value assumptions, measurement input, percentages | 2.89% |
Dividend Yield [Member] | |
Fair value assumptions, measurement input, percentages | 0.00% |
Expected Volatility [Member] | Minimum [Member] | |
Fair value assumptions, measurement input, percentages | 95.73% |
Expected Volatility [Member] | Maximum [Member] | |
Fair value assumptions, measurement input, percentages | 119.45% |
Expected Term [Member] | Minimum [Member] | |
Fair value assumptions, measurement input, term | 3 years |
Expected Term [Member] | Maximum [Member] | |
Fair value assumptions, measurement input, term | 5 years |
Stock Based Compensation - Sc_4
Stock Based Compensation - Schedule of Warrants Activity (Details) | 12 Months Ended |
Dec. 31, 2018$ / sharesshares | |
Number of Shares, Exercisable at end of year | 3,949,018 |
Channel Partner Warrants [Member] | |
Number of Shares, outstanding, at beginning of year | 1,303,832 |
Number of Shares, Issued | 295,000 |
Number of Shares, Exercised | |
Number of Shares, Forfeited | (581,692) |
Number of Shares, outstanding at end of year | 1,017,140 |
Number of Shares, Exercisable at end of year | 319,944 |
Weighted Average Exercise Price, outstanding, at beginning of year | $ / shares | $ 1.48 |
Weighted Average Exercise Price, Issued | $ / shares | 1.74 |
Weighted Average Exercise Price, Exercised | $ / shares | |
Weighted Average Exercise Price, Forfeited | $ / shares | 1.47 |
Weighted Average Exercise Price, outstanding, at end of year | $ / shares | 1.47 |
Weighted Average Exercise Price, Exercisable at end of year | $ / shares | $ 1.39 |
Weighted Average Remaining Contractual Life, Outstanding at January 1, 2018 | 4 years 4 months 6 days |
Weighted Average Remaining Contractual Life, Outstanding | 3 years 6 months 25 days |
Weighted Average Remaining Contractual Life, Exercisable | 3 years 6 months 14 days |
Stock Based Compensation - Su_2
Stock Based Compensation - Summary of Stock-based Compensation (Details) - USD ($) | Dec. 20, 2018 | Dec. 31, 2018 | Dec. 31, 2017 |
Cost of revenue | $ 7,641,684 | $ 1,590,636 | |
Research and development | 1,179,944 | 114,873 | |
General and administrative | 10,892,443 | 4,720,824 | |
Total stock based compensation | 4,340,824 | 1,625,687 | |
Stock-based Compensation [Member] | |||
Cost of revenue | 159,205 | 229,720 | |
Research and development | 196,867 | ||
General and administrative | 3,984,752 | 1,395,967 | |
Total costs charged to operations | 4,340,824 | 1,625,687 | |
Capitalized platform development | 1,850,384 | 614,573 | |
Total stock based compensation | 6,191,208 | 2,240,260 | |
Stock-based Compensation [Member] | Channel Partner Warrants [Member] | |||
Cost of revenue | 152,460 | 229,720 | |
Research and development | |||
General and administrative | |||
Total costs charged to operations | 152,460 | 229,720 | |
Capitalized platform development | |||
Total stock based compensation | 152,460 | 229,720 | |
Stock-based Compensation [Member] | Stock Option [Member] | |||
Cost of revenue | |||
Research and development | 95,941 | ||
General and administrative | 1,112,020 | 618,761 | |
Total costs charged to operations | 1,207,961 | 618,761 | |
Capitalized platform development | 211,346 | ||
Total stock based compensation | 1,419,307 | 618,761 | |
Restricted Stock [Member] | |||
Total stock based compensation | $ 43,750 | ||
Restricted Stock [Member] | Stock-based Compensation [Member] | |||
Cost of revenue | 6,745 | ||
Research and development | 100,926 | ||
General and administrative | 2,872,732 | 777,206 | |
Total costs charged to operations | 2,980,403 | 777,206 | |
Capitalized platform development | 1,639,038 | 614,573 | |
Total stock based compensation | $ 4,619,441 | $ 1,391,779 |
Settlement of Promissory Note_2
Settlement of Promissory Notes Receivable (Details Narrative) - USD ($) | Dec. 12, 2018 | Nov. 30, 2018 | Aug. 21, 2018 | Jul. 23, 2018 | Mar. 26, 2018 |
Say Media Merger Agreements [Member] | |||||
Debt instrument, description | On December 12, 2018 pursuant to the Say Media Merger Agreements entered into on October 12, 2018 and amended on October 17, 2018, the Company settled the promissory notes receivable by effectively forgiving $3,366,031 of the balance due at closing as reflected on the consolidated statements of operations. The remainder of the promissory notes consisting of $2,078,498 advanced for the execution payments in connection with the acquisition, and $450,000 advanced for acquisition related legal fees of Say Media where reflected as part of the purchase price. | ||||
Notes receivable forgiving balance | $ 3,366,031 | ||||
Promissory notes payable | 2,078,498 | ||||
Legal fees | 450,000 | ||||
Secured Promissory Note [Member] | |||||
Debt instrument, face amount | $ 4,322,166 | $ 322,363 | $ 250,000 | ||
Promissory Note [Member] | |||||
Debt instrument, face amount | $ 5,894,529 | ||||
Say Media, Inc. [Member] | |||||
Due to related party debt | $ 1,000,000 | ||||
Debt instrument, interest rate, stated percentage | 5.00% | ||||
Debt instrument effective interest | 10.00% |
Liquidated Damages - Schedule o
Liquidated Damages - Schedule of Recognized Liquidated Damages (Details) | Dec. 31, 2018USD ($) |
Registration Rights Damages | $ 1,178,956 |
Public Information Failure Damages | 1,870,899 |
Accrued interest | 597,743 |
Totals | 3,647,598 |
12% Convertible Debentures [Member] | |
Registration Rights Damages | |
Public Information Failure Damages | 706,944 |
Accrued interest | 116,726 |
Totals | 823,670 |
Series H Preferred Stock [Member] | |
Registration Rights Damages | 1,163,955 |
Public Information Failure Damages | 1,163,955 |
Accrued interest | 481,017 |
Totals | 2,808,927 |
MDB Common Stock to Be Issued [Member] | |
Registration Rights Damages | 15,001 |
Public Information Failure Damages | |
Accrued interest | |
Totals | $ 15,001 |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Income tax rate | 21.00% | 34.00% |
TCJA income tax provision | $ (838,000) | |
Net operating losses | $ 15.50 | |
Income tax description | limited to 80% of taxable in given year | |
Net operating losses do not expire | $ 21.15 | |
Federal [Member] | ||
Operating loss carryforward | $ 36,650,000 | $ 7,300,000 |
State [Member] | ||
Operating loss carryforward | 33,930,000 | |
Local [Member] | ||
Operating loss carryforward | $ 8,150,000 |
Income Taxes - Schedule of Inco
Income Taxes - Schedule of Income Taxes (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | ||
Current tax benefit: Federal | ||
Current tax benefit: State and local | ||
Total current tax benefit | ||
Deferred tax benefit: Federal | 3,359,203 | 920,356 |
Deferred tax benefit: State and local | 1,498,009 | |
Change in valuation allowance | (4,765,579) | (920,356) |
Total deferred tax benefit | 91,633 | |
Total income tax benefit | $ 91,633 |
Income Taxes - Schedule of Comp
Income Taxes - Schedule of Components of Deferred Tax Assets and Liabilities (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Income Tax Disclosure [Abstract] | ||
Net operating loss carryforwards | $ 10,474,525 | $ 1,544,591 |
Tax credit carryforwards | 263,873 | |
Accrued expenses and other | 64,849 | 38,328 |
Allowance for doubtful accounts | 16,017 | |
Deferred rent | 21,233 | |
Contract liabilities | 84,622 | 3,631 |
Liquidating damages payable | 646,146 | |
Stock based compensation | 242,545 | 119,807 |
Depreciation and amortization | 981,850 | |
Current deferred tax assets | 12,795,660 | 1,706,357 |
Valuation allowance | (8,541,191) | (1,353,207) |
Total deferred tax assets | 4,254,469 | 353,150 |
Depreciation and amortization | (353,150) | |
Acquisition-related intangibles | (4,254,469) | |
Total deferred tax liabilities | (4,254,469) | (353,150) |
Net deferred tax |
Income Taxes - Schedule of Tax
Income Taxes - Schedule of Tax Benefit and Effective Income Tax (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | ||
Federal benefit expected at statutory rate | $ (5,493,498) | $ (2,136,666) |
State and local taxes, net of federal benefit | (1,498,009) | |
Impact of tax rate change | 837,699 | |
Stock based compensation | 434,556 | |
Other differences, net | 246,614 | |
Valuation allowance | 4,765,579 | 920,356 |
Permanent differences | 1,453,125 | 378,611 |
Tax benefit and effective income tax rate | $ (91,633) | |
Federal benefit expected at statutory rate, percentage | 21.00% | 34.00% |
State and local taxes, net of federal benefit, percentage | 5.70% | 0.00% |
Impact of tax rate change, percentage | 0.00% | (13.30%) |
Stock based compensation, percentage | (1.70%) | 0.00% |
Other differences, net, percentage | (0.80%) | 0.00% |
Valuation allowance, percentage | (18.42%) | (14.70%) |
Permanent differences, percentage | (5.46%) | (6.00%) |
Tax benefit and effective income tax rate, percentage | 0.40% | 0.00% |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | Dec. 12, 2018 | Oct. 18, 2018 | Aug. 10, 2018 | Jun. 15, 2018 | Jan. 04, 2018 | Oct. 19, 2017 | May 15, 2017 | Apr. 04, 2017 | Oct. 31, 2016 | Aug. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | Aug. 03, 2018 |
Number of shares issued during period, shares | 307,475 | 12,209,677 | |||||||||||
Proceeds from private placement | $ 1,250,000 | $ 6,254,946 | |||||||||||
Exercisable price per share | $ 0.20 | $ 0.50 | |||||||||||
Warrant expiration term | 5 years | ||||||||||||
Proceeds from convertible debt | $ 4,775,000 | ||||||||||||
Preferred stock stated value | $ 0.01 | ||||||||||||
Conversion price | $ 0.33 | ||||||||||||
Interest expenses | $ 2,508,874 | ||||||||||||
Accrued interest payable | $ 597,743 | ||||||||||||
Series H Preferred Stock [Member] | |||||||||||||
Number of shares issued during period, shares | 19,399.25 | ||||||||||||
Stock issued during period, value | $ 19,400 | ||||||||||||
Stock issued during period, shares, issued for services | 5,592 | ||||||||||||
Debt instrument, interest rate, stated percentage | 10.00% | ||||||||||||
Convertible shares | 955 | ||||||||||||
Conversion price | $ 0.33 | ||||||||||||
Debt principal amount | $ 5,730,000 | ||||||||||||
Prepayment obligations | 955,000 | ||||||||||||
Legal fees | $ 25,296 | ||||||||||||
Accrued interest payable | 481,017 | ||||||||||||
Four Accredited Investors [Member] | Convertible Debt Offering [Member] | |||||||||||||
Proceeds from convertible debt | $ 4,775,000 | ||||||||||||
Debt instrument, interest rate, stated percentage | 10.00% | ||||||||||||
Investment | $ 4,025,000 | ||||||||||||
Maturity date | Jun. 30, 2019 | ||||||||||||
Internal rate of return | The 10% convertible debt was converted on August 10, 2018, as described below, where the investors received additional interest payments to provide the investor with a 20% annual internal rate of return. Upon conversion, Strome received $600,000, James C. Heckman received $200,000, and Joshua Jacobs received $5,000 in satisfaction of the 20% annual internal rate of return by issuing additional shares of the Series H Preferred Stock. | ||||||||||||
James C. Heckman [Member] | Convertible Debt Offering [Member] | |||||||||||||
Investment | $ 1,000,000 | ||||||||||||
Annual interest rate of return | $ 200,000 | ||||||||||||
Joshua Jacobs [Member] | Convertible Debt Offering [Member] | |||||||||||||
Investment | $ 25,000 | ||||||||||||
Annual interest rate of return | $ 5,000 | ||||||||||||
Accredited Investors [Member] | Security Purchase Agreement [Member] | Series H Convertible Preferred Stock [Member] | |||||||||||||
Number of shares issued during period, shares | 19,400 | ||||||||||||
Proceeds from convertible debt | $ 19,399,250 | ||||||||||||
Preferred stock stated value | $ 1,000 | ||||||||||||
Convertible shares | 58,787,879 | ||||||||||||
Conversion price | $ 0.33 | ||||||||||||
B. Riley [Member] | Series H Preferred Stock [Member] | |||||||||||||
Stock issued during period, shares, issued for services | 669 | ||||||||||||
Preferred stock stated value | $ 1,000 | ||||||||||||
B. Riley [Member] | Series H Preferred Stock [Member] | 10% OID Convertible Debentures [Member] | |||||||||||||
Warrants to purchase shares of common stock | 875,000 | ||||||||||||
Proceeds from convertible debt | $ 3,285,000 | ||||||||||||
Legal fees | $ 40,000 | ||||||||||||
Three Accredited Investors [Member] | 10% OID Convertible Debentures [Member] | |||||||||||||
Proceeds from convertible debt | $ 3,551,528 | ||||||||||||
Interest expenses | 82,913 | ||||||||||||
Proceeds from related parties | 8,950,000 | ||||||||||||
Mr. Gary Schuman [Member] | |||||||||||||
Service fees | $ 3,000 | ||||||||||||
Ms. Rinku Sen [Member] | |||||||||||||
Proceeds from related parties | 15,521 | 15,000 | |||||||||||
Mr. Christopher Marlett [Member] | |||||||||||||
Proceeds from related parties | $ 76,917 | $ 11,700 | |||||||||||
Officers [Member] | |||||||||||||
Federal rate, percentage | 2.34% | ||||||||||||
Accrued interest payable | $ 12,574 | ||||||||||||
Notes payable outstanding | $ 680,399 | ||||||||||||
MDB Capital Group LLC [Member] | |||||||||||||
Number of shares issued during period, shares | 1,200,000 | 2,391,304 | 3,765,000 | ||||||||||
Shares issued price, per share | $ 2.50 | $ 1.15 | $ 1 | ||||||||||
Stock issued during period, value | $ 3,000,000 | $ 2,750,000 | $ 3,765,000 | ||||||||||
Proceeds from private placement | $ 188,250 | ||||||||||||
Stock issued during period, shares, issued for services | 60,000 | 119,565 | 162,000 | ||||||||||
Warrants to purchase shares of common stock | 60,000 | 119,565 | |||||||||||
Exercisable price per share | $ 2.50 | ||||||||||||
Strome Mezzanine Fund LP [Member] | Security Purchase Agreement [Member] | Series H Convertible Preferred Stock [Member] | |||||||||||||
Debt description | Strome received 3,600, James C. Heckman, or an affiliated entity, received 1,200, and Joshua Jacobs received 30 shares upon conversion of the 10% convertible debt. | ||||||||||||
Strome Mezzanine Fund LP [Member] | Security Purchase Agreement [Member] | January 4, 2018 & March 30, 2018 [Member] | |||||||||||||
Number of shares issued during period, shares | 1,700,000 | ||||||||||||
Warrants to purchase shares of common stock | 1,500,000 | ||||||||||||
Exercisable price per share | $ 1.19 | ||||||||||||
Warrant expiration term | 5 years | ||||||||||||
Strome Mezzanine Fund LP [Member] | Minimum [Member] | |||||||||||||
Ownership percentage | 10.00% | ||||||||||||
Strome Mezzanine Fund LP [Member] | Convertible Debt Offering [Member] | |||||||||||||
Investment | $ 3,000,000 | ||||||||||||
Annual interest rate of return | $ 600,000 | ||||||||||||
B. Riley FBR, Inc [Member] | 12% Convertible Debenture [Member] | |||||||||||||
Proceeds from convertible debt | 540,000 | ||||||||||||
Legal fees | $ 50,000 | ||||||||||||
B. Riley FBR, Inc [Member] | Series H Preferred Stock [Member] | |||||||||||||
Number of shares issued during period, shares | 669.25 | ||||||||||||
Shares issued price, per share | $ 1,000 | ||||||||||||
Stock issued during period, value | $ 575,000 |
Commitments and Contingencies_2
Commitments and Contingencies (Details Narrative) | Dec. 12, 2018USD ($)ft² | Sep. 19, 2018USD ($) | Jun. 01, 2018$ / shares | Apr. 25, 2018USD ($)ft² | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) |
Security deposit | $ 25,812 | |||||
Operating lease, rent expense | 253,651 | 69,000 | ||||
Payments of guarantees obligation | 1,456,928 | $ 560,000 | ||||
Aggregate commitment amount | 11,500 | |||||
12% Convertible Debenture [Member] | ||||||
Liquidated damages, value | $ 78,548 | |||||
Office Sublease Agreement [Member] | ||||||
Area of land | ft² | 7,457 | |||||
Sub lease term | 12 months | |||||
Operating lease, monthly payments | $ 12,180 | $ 837,935 | ||||
Prepaid rent | 44,121 | |||||
Security deposit | $ 25,812 | 22,992 | ||||
Office Sublease Agreement [Member] | Say Media, Inc. [Member] | ||||||
Area of land | ft² | 5,000 | |||||
Security deposit | $ 55,000 | |||||
Office Sublease Agreement [Member] | Months 22 Through 29 [Member] | Minimum [Member] | ||||||
Rent per share | $ / shares | $ 34.20 | |||||
Office Sublease Agreement [Member] | Months 30 Through 41 [Member] | Minimum [Member] | ||||||
Rent per share | $ / shares | $ 35.22 | |||||
Office Sublease Agreement [Member] | June 30, 2019 [Member] | Say Media, Inc. [Member] | ||||||
Operating lease, monthly payments | 13,438 | |||||
Office Sublease Agreement [Member] | Initial Twelve Month Term [Member] | ||||||
Operating lease, monthly payments | 16,126 | |||||
Office Sublease Agreement [Member] | Next Twelve Month Term [Member] | ||||||
Operating lease, monthly payments | 21,750 | |||||
Office Sublease Agreement [Member] | Next Twelve Month Term [Member] | ||||||
Operating lease, monthly payments | 22,371 | |||||
Office Sublease Agreement [Member] | Reminder Five-Month Term [Member] | ||||||
Operating lease, monthly payments | $ 22,993 | |||||
Office Sublease Agreement [Member] | Until End of the Lease Term [Member] | Say Media, Inc. [Member] | ||||||
Operating lease, monthly payments | $ 13,750 |
Commitments and Contingencies -
Commitments and Contingencies - Schedule of Future Minimum Sublease Rental Payments (Details) | Dec. 31, 2018USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2019 | $ 505,621 |
2020 | 347,845 |
2021 | 226,817 |
Operating lease | $ 1,080,283 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) | Dec. 31, 2020USD ($)$ / sharesshares | Sep. 04, 2020USD ($)$ / sharesshares | Aug. 20, 2020USD ($)$ / sharesshares | Aug. 14, 2020USD ($)$ / sharesshares | Apr. 06, 2020USD ($) | Mar. 25, 2020USD ($) | Mar. 09, 2020USD ($)shares | Mar. 01, 2020USD ($) | Feb. 27, 2020USD ($) | Jan. 14, 2020USD ($)ft² | Dec. 09, 2019USD ($)shares | Oct. 07, 2019USD ($)$ / sharesshares | Oct. 02, 2019USD ($)ft² | Sep. 16, 2019$ / sharesshares | Sep. 09, 2019shares | Aug. 27, 2019USD ($) | Aug. 08, 2019USD ($) | Aug. 07, 2019USD ($)ft² | Jun. 28, 2019USD ($)$ / sharesshares | Jun. 14, 2019USD ($)shares | Jun. 11, 2019$ / sharesshares | Jun. 10, 2019USD ($) | Jun. 10, 2019USD ($) | May 31, 2019shares | May 01, 2019USD ($)$ / sharesshares | Apr. 10, 2019$ / sharesshares | Apr. 08, 2019USD ($)$ / shares | Mar. 27, 2019USD ($)$ / shares | Mar. 18, 2019USD ($)$ / shares | Dec. 12, 2018USD ($)$ / shares | Aug. 10, 2018$ / sharesshares | Jun. 15, 2018USD ($)$ / shares | Oct. 31, 2016shares | Aug. 31, 2016shares | Nov. 11, 2020USD ($)$ / sharesshares | Oct. 31, 2020USD ($) | Feb. 02, 2019shares | Mar. 16, 2019shares | Dec. 15, 2020shares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($)shares | Oct. 20, 2017shares | Jan. 07, 2021shares | Dec. 18, 2020shares | Dec. 17, 2020shares | Aug. 26, 2020USD ($) | Apr. 24, 2020USD ($) | Apr. 03, 2020shares | Dec. 15, 2019$ / shares | Oct. 31, 2019$ / shares | Oct. 04, 2019shares | Jun. 27, 2019shares |
Stock options granted | shares | 8,187,750 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Share issued during period acquisition, value | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Restricted stock-based compensation cost | $ 2,756,527 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock authorized | shares | 1,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Number of shares issued during period, shares | shares | 307,475 | 12,209,677 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock stated value | $ / shares | $ 0.01 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Proceeds from issuance of common stock | 3,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Conversion price per share | $ / shares | $ 0.33 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Cash fee paid | $ 575,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Number of shares fully vested | shares | 175,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Minimum lease payments | $ 1,080,283 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Proceeds from notes | 1,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Accrued interest | $ 597,743 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Common stock, shares authorized | shares | 1,000,000,000 | 1,000,000,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Series H Preferred Stock [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt principal amount | $ 5,730,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Legal fees | $ 25,296 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Number of shares issued during period, shares | shares | 19,399.25 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Conversion of stock | shares | 58,785,606 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Conversion price per share | $ / shares | $ 0.33 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Stock issued during period, value | $ 19,400 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Shares issued upon conversion of debt | shares | 955 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Debt instrument, interest rate, stated percentage | 10.00% | |||||||||||||||||||||||||||||||||||||||||||||||||||
Accrued interest | $ 481,017 | |||||||||||||||||||||||||||||||||||||||||||||||||||
B. Riley [Member] | Series H Preferred Stock [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock stated value | $ / shares | $ 1,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Levinsohn's [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock issued during period, shares, restricted stock award, gross | shares | 245,434 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Restricted stock-based compensation cost | $ 88,235 | $ 46,611 | ||||||||||||||||||||||||||||||||||||||||||||||||||
12% Convertible Debentures [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt principal amount | $ 13,091,528 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Placement fee payable in cash | 540,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Proceeds from issuance of debt | $ 8,950,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Debt maturity date | Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Conversion price per share | $ / shares | $ 0.33 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Debt instrument, interest rate, stated percentage | 12.00% | |||||||||||||||||||||||||||||||||||||||||||||||||||
12% Senior Secured Note [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt instrument, interest rate, stated percentage | 12.00% | |||||||||||||||||||||||||||||||||||||||||||||||||||
Restricted Stock [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock options granted | shares | 4,606,503 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Number of shares fully vested | shares | 4,946,490 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Number of shares vested | shares | 1,064,549 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Purchase price per share | $ / shares | $ 4 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Licensing agreement description | The initial term of the Licensing Agreement shall commence upon the termination of the Meredith License Agreement (as defined below) and shall continue through December 31, 2029. The Company has the option, subject to certain conditions, to renew the term of the Licensing Agreement for nine consecutive renewal terms of 10 years each (collectively, the "Term"), for a total of 100 years. | |||||||||||||||||||||||||||||||||||||||||||||||||||
Prepaid royalties | $ 45,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Number of shares issued during period, shares | shares | 539,331 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Conversion price per share | $ / shares | $ 1 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Area of land | ft² | 5,258 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Lease expiration date | Sep. 30, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Annual lease payments | $ 1,344,900 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Lease term | 5 years | |||||||||||||||||||||||||||||||||||||||||||||||||||
Accrued interest | $ 379,443 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Common stock, shares authorized | shares | 1,000,000,000 | 100,000,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Series I Convertible Preferred Stock [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Common stock conversion price | $ / shares | $ 0.50 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock authorized | shares | 25,800 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock stated value | $ / shares | $ 1,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Conversion of stock | shares | 46,200,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Proceeds from issuance of common stock | $ 23,100,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock issued | shares | 23,100 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Series J Convertible Preferred Stock [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Licensing agreement description | If the Company fails for any reason to satisfy the current public information requirement, then the Company will be obligated to pay Public Information Failure Damages (as further described in Note 11) to each holder, consisting of a cash payment equal to 1% of the amount invested as partial liquidated damages, up to a maximum of six months, subject to interest at the rate of 1% per month until paid in full (refer to "Liquidating Damages" below for further details). | |||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock authorized | shares | 35,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Net proceeds from issuance of debt | $ 20,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock stated value | $ / shares | $ 1,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Conversion of stock | shares | 28,571,428 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Conversion price per share | $ / shares | $ 0.70 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock issued | shares | 20,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Cash fee paid | $ 525,240 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Reimbursement of legal fee | 43,043 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Payment of deferred fees | 5,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Working capital and general coporate | $ 14,400,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Series J Preferred Stock [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Accrued interest | $ 122,696 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Lease Agreement [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Area of land | ft² | 40,868 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Lease expiration date | Aug. 31, 2020 | Nov. 30, 2032 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Annual lease payments | $ 153,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Maximum tenant allowance | $ 408,680 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Minimum lease payments | 38,415,920 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Cramer Digital Inc [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Annualized guaranteed payment | $ 3,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Reimbursement of rent expense | $ 4,250 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | ABG-SI LLC [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Licensing agreement description | The Company issued ABG warrants to acquire 21,989,844 shares of the Company's common stock (the "Warrants"). Half the Warrants shall have an exercise price of $0.42 per share (the "Forty-Two Cents Warrants"). The other half of the Warrants shall have an exercise price of $0.84 per share (the "Eighty-Four Cents Warrants"). The Warrants provide for the following: (1) 40% of the Forty-Two Cents Warrants and 40% of the Eighty-Four Cents Warrants shall vest in equal monthly increments over a period of two years beginning on the one year anniversary of the date of issuance of the Warrants (any unvested portion of such Warrants to be forfeited by ABG upon certain terminations by the Company of the Licensing Agreement); (2) 60% of the Forty-Two Cents Warrants and 60% of the Eighty-Four Cents Warrants shall vest based on the achievement of certain performance goals for the licensed brands in calendar years 2020, 2021, 2022 or 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Stock issued during period acquisition | shares | 21,989,844 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | TheStreet, Inc [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Area of land | ft² | 35,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Lease expiration date | Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Annual lease payments | $ 1,804,750 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Asset Acquisition of Petametrics Inc., [Member] | Closing [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Cash fee paid | $ 1,312,023 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Cash payment | $ 184,086 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Asset Acquisition of Petametrics Inc., [Member] | Second Anniversary Date [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Number of restricted common stock | shares | 312,500 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Asset Acquisition of Petametrics Inc., [Member] | First Anniversary Date [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Number of restricted common stock | shares | 312,500 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | B. Riley [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt principal amount | $ 18,300,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Cash fee paid | $ 1,386,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Reimbursement of legal fee | $ 52,500 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Payment of deferred fees | 3,400,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Accredited Investors [Member] | Series J Preferred Stock [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Number of shares issued during period, shares | shares | 10,500 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock stated value | $ / shares | $ 1,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Conversion of stock | shares | 6,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Proceeds from issuance of common stock | $ 15,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Conversion price per share | $ / shares | $ 0.70 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Accredited Investors [Member] | Series K Preferred Stock [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock authorized | shares | 20,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Accredited Investors [Member] | Securities Purchase Agreement [Member] | Series K Preferred Stock [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt principal amount | $ 3,400,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Payments for piror investment | $ 2,600,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Number of shares issued during period, shares | shares | 18,042 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock stated value | $ / shares | $ 1,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Conversion price per share | $ / shares | $ 0.40 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Cash fee paid | $ 520,500 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Stock issued during period, value | $ 18,042,090 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Common stock shares issuable upon converiosn | shares | 45,105,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Working capital | $ 12,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Mr. Smith's [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Officers compensation | $ 400,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Stock option exercise price | $ / shares | $ 0.57 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Stock option term | 10 years | |||||||||||||||||||||||||||||||||||||||||||||||||||
Stock option vesting description | Of the 1,500,000 options granted: (i) 1,000,000 options will vest over 36 months, with 1/3 vesting after 12 months of continuous service and 1/36 vesting monthly for each month of continuous service thereafter; and (ii) 500,000 will vest over 36 months, with 1/3 vesting after 12 months of continuous service and 1/36 vesting monthly for each month of continuous service thereafter, subject to the Company's common stock being listed on a national securities exchange. | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Mr. Smith's [Member] | Maximum [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Option to purchase common stock | shares | 1,500,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Levinsohn's [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Option to purchase common stock | shares | 532,004 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Stock option exercise price | $ / shares | $ 0.78 | $ 0.42 | $ 0.46 | |||||||||||||||||||||||||||||||||||||||||||||||||
Stock option term | 3 years | 3 years | 10 years | |||||||||||||||||||||||||||||||||||||||||||||||||
Stock issued during period acquisition | shares | 2,000,000 | 2,000,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock authorized | shares | 500,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | One Accredited Investor [Member] | Series H Preferred Stock [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Number of shares issued during period, shares | shares | 2,253 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock stated value | $ / shares | $ 1,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Conversion of stock | shares | 6,825,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Proceeds from issuance of common stock | $ 2,730,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Conversion price per share | $ / shares | $ 0.33 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | One Accredited Investor [Member] | Security Purchase Agreement [Member] | Series H Preferred Stock [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Number of shares issued during period, shares | shares | 2,253 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock stated value | $ / shares | $ 1,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Conversion of stock | shares | 6,825,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Proceeds from issuance of common stock | $ 2,730,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Conversion price per share | $ / shares | $ 0.33 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Mr. Avi Zimak [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Annual salary | $ 450,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Payment on bonus | $ 250,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Number of shares fully vested | shares | 1,125,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Vesting description | The stock options will vest as to 1,125,000 shares, in three equal installments, based on performance targets tied to the achievement of established annual revenue targets for fiscal years 2020 to and including 2022. The remaining 1,250,000 stock options will vest as follows: (i) 1/3 will vest after 12 months from the date of the employment agreement; and (ii) then 1/36th will vest at the end of each month thereafter, concluding 36 months from the effect date of the employment agreement. Currently these options are unfunded, and the Company has agreed to timely increase the availability of shares of common stock to permit the exercise of the options upon vesting. | |||||||||||||||||||||||||||||||||||||||||||||||||||
Number of restricted common stock | shares | 250,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Employee vesting period | 2 years | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Mr. Avi Zimak [Member] | Annual Bonus [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Payment on bonus | $ 450,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | 12% Convertible Debentures [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt principal amount | $ 18,104,949 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Proceeds from issuance of debt | $ 100,000 | $ 300,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Common stock conversion price | $ / shares | $ 0.40 | $ 0.40 | $ 0.40 | |||||||||||||||||||||||||||||||||||||||||||||||||
Debt conversion outstanding balance | $ 1,130,903 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Shares issued upon conversion of debt | shares | 53,887,470 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | 12% Convertible Debentures [Member] | Maximum [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Conversion price per share | $ / shares | $ 0.33 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | 12% Convertible Debentures [Member] | Minimum [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Conversion price per share | $ / shares | $ 0.40 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | 12% Convertible Debentures [Member] | Two Accredited Investors [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt principal amount | $ 1,696,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Legal fees | 10,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Proceeds from issuance of debt | 1,590,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | 12% Convertible Debentures [Member] | B. Riley [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Placement fee payable in cash | $ 6,000 | $ 18,000 | $ 96,000 | |||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | 12% Convertible Debentures [Member] | Accredited Investors [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt principal amount | $ 100,000 | $ 318,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Stock Option [Member] | Mr. Smith's [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Option to purchase common stock | shares | 1,064,008 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Stock option exercise price | $ / shares | $ 0.46 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Stock option term | 10 years | |||||||||||||||||||||||||||||||||||||||||||||||||||
Stock option vesting description | The options will vest over 36 months, with 1/3 vesting after 12 months of continuous service and 1/36 vesting monthly for each month of continuous service thereafter; and (ii) the Company's common stock must be listed on a national securities exchange, with incremental vesting upon achievement of certain stock price targets based on a 45-day VWAP during which time the average monthly trading volume of the common stock must be at least 15% of the Company's aggregate market capitalization. | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | 12% Senior Secured Note [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt principal amount | $ 20,000,000 | $ 20,000,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Proceeds from issuance of debt | 18,865,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Escrow deposit | 16,500,000 | 16,500,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Note payable | $ 2,365,000 | 2,365,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Debt maturity date | Jul. 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | 12% Senior Secured Note [Member] | ABG-SI LLC [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Note payable | 550,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | 12% Senior Secured Note [Member] | B. Riley [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Placement fee payable in cash | $ 1,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | 12% Senior Secured Note [Member] | Investors [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Proceeds from issuance of debt | 45,550,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Repayments of debt | 45,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Restricted Stock [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Restricted stock awards granted outstanding | shares | 2,399,997 | 1,395,833 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Outside Options [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock options granted | shares | 1,500,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Ten Year Stock Option [Member] | Mr. Avi Zimak [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock options granted | shares | 2,250,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Initial Sixty-Month Term [Member] | Lease Agreement [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Minimum lease payments | 252,019 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Second Sixty-Month Term [Member] | Lease Agreement [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Minimum lease payments | 269,048 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Remainder Twenty-Five Month Term [Member] | Lease Agreement [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Minimum lease payments | $ 286,076 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | FastPay Credit Facility [Member] | Financing and Security Agreement [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Line of credit | $ 15,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Line of credit maturity date | Feb. 6, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Debt conversion outstanding balance | $ 7,179,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Line of credit outstanding amount | $ 3,242,969 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | FastPay Credit Facility [Member] | Financing and Security Agreement [Member] | LIBOR Rate Plus [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Line of credit interest rate | 8.50% | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Delayed Draw Term Loan [Member] | BRF Finance Co., LLC [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt principal amount | $ 12,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Placement fee payable in cash | $ 7,379,800 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Legal fees | 793,109 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Note payable | 4,294,228 | $ 6,913,865 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Debt conversion outstanding balance | 3,367,090 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Debt instrument, interest rate, stated percentage | 15.00% | |||||||||||||||||||||||||||||||||||||||||||||||||||
Proceeds from notes | 6,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Accrued interest | 675,868 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Working capital | $ 15,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Delayed Draw Term Loan [Member] | BRF Finance Co., LLC [Member] | Thereunder due on June 14, 2022 [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt principal amount | $ 8,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Delayed Draw Term Loan [Member] | BRF Finance Co., LLC [Member] | Term Note is due on March 31, 2021 [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt principal amount | $ 8,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Payroll Protection Program Loan [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Note payable | $ 5,702,725 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Debt maturity date | Apr. 6, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Debt instrument, interest rate, stated percentage | 0.98% | |||||||||||||||||||||||||||||||||||||||||||||||||||
Proceeds from notes | $ 5,700,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | 2019 Equity Incentive Plan [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock options granted | shares | 81,592,584 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Stock options, shares authorized | shares | 85,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | 2019 Equity Incentive Plan [Member] | Restricted Stock [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Restricted stock awards granted outstanding | shares | 81,592,584 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Merger Agreement [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Share issued during period acquisition, value | $ 16,500,000 | 16,500,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Escrow Agreement [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Share issued during period acquisition, value | 16,500,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Amended and Restated Note Purchase Agreement [Member] | 12% Senior Secured Note [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt principal amount | 68,000,000 | $ 20,000,000 | $ 20,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||
Proceeds from issuance of debt | $ 48,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Debt maturity date | Jun. 14, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Debt conversion outstanding balance | $ 4,800,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Amended and Restated Note Purchase Agreement [Member] | 12% Senior Secured Note [Member] | B. Riley [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Placement fee payable in cash | $ 2,400,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Licensing agreement description | On February 27, 2020, the Company entered into a second amendment to amended and restated note purchase agreement with one accredited investor, BRF Finance Co., LLC, an affiliated entity of B. Riley, which amended the first amendment to the amended and restated 12% senior secured note dated August 27, 2019. Pursuant to the second amendment, the Company is (i) allowed to replace its previous $3.5 million working capital facility with a new $15.0 million working capital facility; and (ii) permitted to account for the issuance by the investor of a $3.0 million letter of credit to the Company's landlord for the Company's lease of the premises located at 225 Liberty Street, 27th Floor, New York, NY 10281. | |||||||||||||||||||||||||||||||||||||||||||||||||||
Line of credit | $ 56,296,090 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Amended and Restated Note Purchase Agreement [Member] | 12% Senior Secured Note [Member] | B. Riley [Member] | Payment-in-Kind of Interest [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Line of credit | $ 7,457,388 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event [Member] | Amended Note Purchase Agreement [Member] | 12% Senior Secured Note [Member] | Investors [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Proceeds from issuance of debt | $ 3,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Payments to creditors | 150,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Net proceeds from issuance of debt | $ 2,830,000 |
Subsequent Events - Schedule of
Subsequent Events - Schedule of Liquidating Damages (Details) - USD ($) | Aug. 26, 2020 | Dec. 31, 2018 |
Registration Rights Damages | $ 1,178,956 | |
Public Information Failure Damages | 1,870,899 | |
Accrued interest | 597,743 | |
Totals | $ 3,647,598 | |
Subsequent Event [Member] | ||
Registration Rights Damages | $ 1,786,000 | |
Public Information Failure Damages | 1,475,000 | |
Accrued interest | 379,443 | |
Totals | 3,640,443 | |
Subsequent Event [Member] | Series I Preferred Stock [Member] | ||
Registration Rights Damages | 1,386,000 | |
Public Information Failure Damages | 1,155,000 | |
Accrued interest | 242,873 | |
Totals | 2,783,873 | |
Subsequent Event [Member] | Series J Preferred Stock [Member] | ||
Registration Rights Damages | 400,000 | |
Public Information Failure Damages | 200,000 | |
Accrued interest | 122,696 | |
Totals | 722,696 | |
Subsequent Event [Member] | 12% Convertible Debenture [Member] | ||
Registration Rights Damages | ||
Public Information Failure Damages | 120,000 | |
Accrued interest | 13,874 | |
Totals | $ 133,874 |