Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
May 31, 2016 | Jul. 11, 2016 | |
Document And Entity Information | ||
Entity Registrant Name | SolarWindow Technologies, Inc. | |
Entity Central Index Key | 1,071,840 | |
Document Type | 10-Q | |
Document Period End Date | May 31, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --08-31 | |
Is Entity a Well-known Seasoned Issuer | No | |
Is Entity a Voluntary Filer | No | |
Is Entity's Reporting Status Current | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 28,500,221 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2,016 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | May 31, 2016 | Aug. 31, 2015 |
Current assets | ||
Cash and cash equivalents | $ 123,541 | $ 228,465 |
Deferred research and development costs | 421,055 | 106,135 |
Prepaid expenses and other current assets | 28,159 | 21,152 |
Total current assets | 572,755 | 355,752 |
Equipment, net of accumulated depreciation of $33,439 and $27,751, respectively | 24,239 | 30,535 |
Total assets | 596,994 | 386,287 |
Current liabilities | ||
Accounts payable | 105,990 | 97,438 |
Interest payable to related party | 54,405 | 443,498 |
Bridge note, net of discount of $131,034 and $6,516 | 468,966 | 593,484 |
Convertible promissory notes payable to related party, net of discount of $0 and $879,808, respectively | 18,146 | 2,120,192 |
Derivative liability | 1,875,630 | |
Total current liabilities | 2,523,137 | 3,254,612 |
Convertible promissory notes payable to related party, net of discount of $1,961,847 | 1,038,153 | |
Interest payable to related party | 605,627 | |
Total liabilities | 4,166,917 | 3,254,612 |
Commitments and contingencies | ||
Stockholders' equity (deficit) | ||
Preferred stock: $0.10 par value; 1,000,000 shares authorized, no shares issued and outstanding | ||
Common stock: $0.001 par value; 300,000,000 shares authorized, 27,562,721 and 26,572,615 shares issued and outstanding at May 31, 2016 and August 31, 2015 | 27,563 | 26,572 |
Additional paid-in capital | 30,674,445 | 26,144,117 |
Retained deficit | (34,271,931) | (29,039,014) |
Total stockholders' equity (deficit) | (3,569,923) | (2,868,325) |
Total liabilities and stockholders' equity (deficit) | $ 596,994 | $ 386,287 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | May 31, 2016 | Aug. 31, 2015 |
Current assets | ||
Equipment, net of accumulated depreciation | $ 33,439 | $ 27,751 |
Current liabilities | ||
Bridge note, net of discount | 131,034 | 6,516 |
Convertible promissory note, net of discount | 0 | 879,808 |
Convertible promissory notes payable to related party, net of discount | $ 1,961,847 | $ 1,961,847 |
Stockholders' equity | ||
Preferred stock, par value | $ 0.10 | $ 0.10 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common stock, shares issued | 27,562,721 | 26,572,615 |
Common stock, shares outstanding | 27,562,721 | 26,572,615 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | 9 Months Ended | ||
May 31, 2016 | May 31, 2015 | May 31, 2016 | May 31, 2015 | |
Consolidated Statements Of Operations | ||||
Revenue | ||||
Operating expense | ||||
Selling, general and administrative | 410,591 | 561,888 | 1,720,779 | 1,783,839 |
Research and development | 272,373 | 127,215 | 584,232 | 466,708 |
Total operating expense | 682,964 | 689,103 | 2,305,011 | 2,250,547 |
Loss from operations | (682,964) | (689,103) | (2,305,011) | (2,250,547) |
Other income (expense) | ||||
Interest expense | (78,931) | (68,438) | (233,370) | (180,242) |
Accretion of debt discount | (683,574) | (806,821) | (1,967,895) | (3,913,769) |
Change in fair value of derivative liability | (89,010) | (161,235) | ||
Loan conversion inducement expense | (565,406) | (565,406) | ||
Total other income (expense) | (1,416,921) | (875,259) | (2,927,906) | (4,094,011) |
Net loss | $ (2,099,885) | $ (1,564,362) | $ (5,232,917) | $ (6,344,558) |
Basic and Diluted Loss per Common Share | $ (0.08) | $ (0.06) | $ (0.19) | $ (0.26) |
Weighted average number of common shares outstanding - basic and diluted | 27,427,913 | 25,224,700 | 26,957,191 | 24,823,496 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) | Common Stock | Additional Paid-In Capital | Retained Deficit | Total |
Beginning Balance, Shares at Aug. 31, 2014 | 24,306,612 | |||
Beginning Balance, Amount at Aug. 31, 2014 | $ 24,306 | $ 20,872,345 | $ (20,946,270) | $ (49,619) |
Stock based compensation related to restricted stock issuance, Shares | 60,000 | |||
Stock based compensation related to restricted stock issuance, Amount | $ 60 | 83,940 | 84,000 | |
Stock based compensation due to common stock purchase options | 436,774 | 436,774 | ||
Discount on convertible promissory note due to detachable warrants | 3,000,000 | 3,000,000 | ||
Discount on $600,000 bridge loan due to detachable warrants | 299,750 | 299,750 | ||
Exercise of Series H warrants, Shares | 1,751,216 | |||
Exercise of Series H warrants, Amount | $ 1,751 | 1,451,763 | 1,453,514 | |
Exercise of Series G warrants, Shares | 454,787 | |||
Exercise of Series G warrants, Amount | $ 455 | (455) | ||
Net loss | (8,092,744) | (8,092,744) | ||
Ending Balance, Shares at Aug. 31, 2015 | 26,572,615 | |||
Ending Balance, Amount at Aug. 31, 2015 | $ 26,572 | 26,144,117 | (29,039,014) | (2,868,325) |
Stock based compensation related to restricted stock issuance, Shares | 90,000 | |||
Stock based compensation related to restricted stock issuance, Amount | $ 90 | 337,410 | 337,500 | |
Stock based compensation due to common stock purchase options | 252,556 | 252,556 | ||
Exercise of stock options, Shares | 282,106 | |||
Exercise of stock options, Amount | $ 282 | (282) | ||
Discount on convertible promissory note due to detachable warrants | 3,008,812 | 3,008,812 | ||
Discount on convertible promissory note due to beneficial conversion feature | 165,640 | 165,640 | ||
February 2016 Private Placement units issued, Shares | 618,000 | |||
February 2016 Private Placement units issued, Amount | $ 619 | 766,192 | 766,811 | |
Net loss | (5,232,917) | (5,232,917) | ||
Ending Balance, Shares at May. 31, 2016 | 27,562,721 | |||
Ending Balance, Amount at May. 31, 2016 | $ 27,563 | $ 30,674,445 | $ (34,271,931) | $ (3,569,923) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 9 Months Ended | |
May 31, 2016 | May 31, 2015 | |
Cash flows from operating activities | ||
Net loss | $ (5,232,917) | $ (6,344,558) |
Adjustments to reconcile net loss to net cash used in operating activities | ||
Depreciation | 8,596 | 6,907 |
Stock based compensation expense | 590,056 | 449,736 |
Change in fair value of derivative liability | 161,235 | |
Loan conversion inducement expense | 565,406 | |
Accretion of debt discount | 1,967,895 | 3,913,769 |
Changes in operating assets and liabilities: | ||
Decrease (increase) in deferred research and development costs | (314,920) | |
Decrease (increase) in prepaid expenses and other current assets | (7,007) | (13,902) |
Increase (decrease) in accounts payable | 8,552 | 6,057 |
Increase (decrease) in accrued liabilities | 233,370 | 180,242 |
Net cash used in operating activities | (2,019,734) | (1,801,749) |
Cash flows from investing activity | ||
Purchase of equipment | (2,300) | (15,561) |
Net cash used in investing activity | (2,300) | (15,561) |
Cash flows from financing activities | ||
Proceeds from the issuance of equity securities | 1,367,100 | 501,242 |
Proceeds from promissory notes | 550,010 | 600,000 |
Net cash provided by financing activities | 1,917,110 | 1,101,242 |
Decrease in cash and cash equivalents | (104,924) | (716,068) |
Cash and cash equivalents at beginning of period | 228,465 | 785,237 |
Cash and cash equivalents at end of period | 123,541 | 69,169 |
Supplemental disclosure of cash flow information: | ||
Interest paid in cash | ||
Income taxes paid in cash | ||
Supplemental disclosure of non-cash transactions: | ||
Debt discount recorded for value of warrants issued and/or modified | 3,008,812 | 3,299,750 |
Debt discount recorded for beneficial conversion feature | 165,640 | |
Equity securities issued for conversion of note payable | 548,700 | |
Derivative liability from the sale of equity securities | $ 1,714,395 |
Basis of Presentation, Organiza
Basis of Presentation, Organization, Recent Accounting Pronouncements and Going Concern | 9 Months Ended |
May 31, 2016 | |
Notes to Financial Statements | |
Note 1. Basis of Presentation, Organization, Recent Accounting Pronouncements and Going Concern | Basis of Presentation The unaudited financial statements of SolarWindow Technologies, Inc. (the " Company GAAP KEC New Energy Solar Organization SolarWindow Technologies, Inc. was incorporated in the State of Nevada on May 5, 1998, under the name "Octillion Corp." On December 2, 2008, the Company amended its Articles of Incorporation to effect a change of name to New Energy Technologies, Inc. Effective as of March 9, 2015, the Company amended its Articles of Incorporation to change its name to SolarWindow Technologies, Inc. The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, KEC and New Energy Solar. KEC was incorporated on June 19, 2008, in the State of Nevada and holds the patents related to the Company's MotionPower technology. The Company's business activities related to the MotionPower technology are conducted through KEC. New Energy Solar was incorporated on February 9, 2009, in the State of Florida and entered into agreements with The University of South Florida Research Foundation (" USF On March 9, 2015, the Company changed its name to "SolarWindow Technologies, Inc." to align the company name with its brand identity. The Company's ticker symbol changed to WNDW. The Company has been developing two sustainable electricity generating systems. These novel technologies are branded as SolarWindow and MotionPower. On March 2, 2015, the Company announced its exclusive focus on SolarWindow. The Company's SolarWindow technology provides the ability to harvest light energy from the sun and artificial sources and generate electricity from a transparent coating of organic photovoltaic solar cells. The Company's SolarWindow transparent electricity generating coatings are the subject of patent pending technologies. Initially being developed for application on glass surfaces, SolarWindow coatings could potentially be used on any of the more than 85 million commercial and residential buildings in the United States alone. The Company's SolarWindow product development programs involve ongoing research and development efforts, and the commitment of significant resources to support the extensive invention, design, engineering, testing, prototyping, and intellectual property initiatives carried-out by its contract engineers, scientists, and consultants. As such, the Company's activities are subject to significant risks and uncertainties, including failing to secure additional funding to commercialize the Company's SolarWindow technology before another company develops a similar technology and products. Recent Accounting Pronouncements In April 2015, the FASB issued ASU 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs, which requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. This ASU requires retrospective adoption and will be effective for fiscal years beginning after December 15, 2015 and for interim periods within those fiscal years. We expect the adoption of this guidance will not have a material impact on our financial statements. In February 2015, the FASB issued ASU 2015-02, Amendments to the Consolidation Analysis, which amends the consolidation requirements in ASC 810 and significantly changes the consolidation analysis required under U.S. GAAP relating to whether or not to consolidate certain legal entities. Early adoption is permitted. The Company's effective date for adoption is January 1, 2016. The Company does not expect this accounting update to have a material effect on its consolidated financial statements in future periods, although that could change. On May 28, 2014, FASB issued ASU 2014-09, Revenue from Contracts with Customers, Topic 606, requiring an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The updated standard will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective and permits the use of either the retrospective or cumulative effect transition method. Early adoption is not permitted. The standard is effective for annual periods beginning after December 15, 2017. The Company has not yet selected a transition method and does not expect this accounting update to have a material effect on its consolidated financial statements in future periods. The Company reviews new accounting standards as issued. Although some of these accounting standards issued or effective after the end of the Company's previous fiscal year may be applicable, the Company has not identified any standards that the Company believes merit further discussion. The Company believes that none of the new standards will have a significant impact on the financial statements. Going Concern The Company does not have any commercialized products and has not generated any revenue since inception. The Company has an accumulated deficit of $34,271,931 and cash of $123,541 as of May 31, 2016, and does not have positive cash flows from operating activities. The accompanying consolidated financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America, which contemplates continuation of the Company as a going concern, which is dependent upon the Company's ability to establish itself as a profitable business. Subsequent to quarter end, the Company, on June 20, 2016, received $3,000,000 from the sale of 937,500 units pursuant to a private placement of its securities (the " June 2016 Private Placement If adequate funds are not available on reasonable terms, or at all, it would result in a material adverse effect on the Company's business, operating results, financial condition and prospects. In particular, the Company may be required to delay, reduce the scope of or terminate its research programs, sell rights to its SolarWindow technology and/or MotionPower technology or other technologies or products based upon such technologies, or license the rights to such technologies or products on terms that are less favorable to the Company than might otherwise be available. In view of these conditions, the ability of the Company to continue as a going concern is in substantial doubt and dependent upon achieving a profitable level of operations and on the ability of the Company to obtain necessary financing to fund ongoing operations. These consolidated financial statements do not give effect to any adjustments which will be necessary should the Company be unable to continue as a going concern and therefore be required to realize its assets and discharge its liabilities in other than the normal course of business and at amounts different from those reflected in the accompanying consolidated financial statements. |
Debt
Debt | 9 Months Ended |
May 31, 2016 | |
Notes to Financial Statements | |
Note 2. Debt | December 7, 2015, $550,000 Bridge Loan On December 7, 2015, the Company entered into a Bridge Loan Agreement (the " December 2015 Loan Agreement Investor The debt discount attributable to the warrants and beneficial conversion feature amounted to $458,777 (including $400,000 recognized as of October 7, 2015 and $58,777 recognized on December 22, 2015). The estimated fair value of the Series M Warrants was calculated using the Black-Scholes option pricing model and the following assumptions: market price of common stock - $3.01 per share; estimated volatility 79%; 5-year risk free interest rate 1.67%; expected dividend rate - 0% and expected life - 5 years. The resulting $458,777 discount was accreted through March 31, 2016. On March 31, 2016, the Investor received 177 PPM Units (as defined below under Note 3) from the conversion of $548,700 of the principal owed under the December 2015 Loan Agreement resulting in a remaining balance of $18,146. The remaining balance was evidenced by a new promissory note (the " March 2016 Note As consideration for the Investor agreeing to extend the 2013 Note maturity date to December 31, 2017 (as described below), the Company extended the expiration date of all of the Investor's existing warrants, including the Series M Warrant maturity date from December 7, 2020 to December 31, 2020. The difference in fair value of the Series M Warrant as a result of the extension of the expiration date was immaterial. During the three and nine months ended May 31, 2016, the Company recognized $5,077 and $17,149, respectively, of interest expense. During the three and nine months ended May 31, 2016, the Company recognized $315,515 and $458,777, respectively, of accretion related to the debt discount of the December 2015 Loan Agreement. March 4, 2015, $600,000 Bridge Loan On March 4, 2015, the Company entered into a Bridge Loan Agreement (the " Bridge Loan Agreement Creditor The debt discount attributable to the relative fair value of the warrants issued with the March 2015 Loan, amounted to $299,750. The estimated fair value of the Series L Warrant was $1.198 per share and was calculated using the Black-Scholes option pricing model with the following assumptions: market price of common stock - $1.78 per share; estimated volatility - 76%; risk free interest rate 1.55%; expected dividend rate - 0% and expected life 4.5 years. The resulting discount was ccreted over the original term of the March 2015 Loan through September 4, 2015. On December 7, 2015, Creditor agreed to extend the maturity date of the March 2015 Loan from September 4, 2015 to December 31, 2016. As consideration the Company issued Creditor a Series M Stock Purchase Warrant to purchase 100,000 shares of the Company's common stock through December 7, 2020, at an exercise price of $2.34 per share As a result, the Company recognized an additional debt discount for the fair value of the Series M Stock Purchase Warrant amounting to $205,800. The fair value of the Series M Warrant was $2.058 and was calculated using the Black-Scholes option pricing model and the following assumptions: exercise price - $2.34; market price of common stock - $3.01 per share; estimated volatility - 79%; risk free interest rate - 1.67%; expected dividend rate - 0% and expected life - 5 years. The Company recorded $33,000 as additional debt discount to recognize the increase in fair value for the extension of the expiration date of the Series L Warrant from March 4, 2020 to December 7, 2020. The increase in fair value was calculated using the Black-Scholes option pricing model and the following assumptions: exercise price - $1.20; market price of common stock - $3.01 per share; estimated volatility - 79%; risk free interest rate - 1.67%; expected dividend rate - 0% and expected life - 5 years for the new warrant and 4.24 years for the original warrant. During the three and nine months ended May 31, 2016, the Company recognized $11,341 and $33,201, respectively, of interest expense. During the three and nine months ended May 31, 2015, the Company recognized $10,126 and $10,126, respectively, of interest expense. Accretion related to the debt discount for the March 2015 Loan amounted to $56,332 and $114,282 during the three and nine months ended May 31, 2016, respectively. Accretion related to the debt discount amounted to $143,359 and $143,359 during the three and nine months ended May 31, 2015, respectively. October 7, 2013, $3,000,000 Convertible Promissory Note On October 7, 2013, the Company entered into a Bridge Loan Agreement (the " 2013 Loan Agreement 2013 Note Series I Warrant Series J Warrant Series K Warrant On November 10, 2014, the Company entered into an Amended Bridge Loan Agreement (the " 2015 Loan Agreement Amended Note Units In order to induce the Investor to enter into the 2015 Loan Agreement and extend the maturity date to December 31, 2015, the Company issued a Series J Warrant to purchase 3,110,378 shares of its common stock at an exercise price of $1.12 and a Series K Warrant to purchase 3,110,378 shares of its common stock at an exercise price of $1.20. Each of the Series J Warrant and Series K Warrant was initially exercisable through November 9, 2019. As a result of the modification (which did not result in a gain or loss due to the related party nature of the transaction), the fair value of the Warrant amounting to $3,629,309 (limited to the $3,000,000 face value of the note) was recognized as a debt discount as of November 10, 2014. On December 31, 2015, the Company entered into a Second Amended Bridge Loan Agreement (the " 2015 Second Amended Loan Agreement Second Amended Note As consideration for the Investor agreeing to extend the 2013 Note maturity date to December 31, 2017, the Company issued a Series N Warrant and extended the maturity date of all of the Investor's existing warrants, as described below, resulting in an additional debt discount of $2,476,875 as of December 31, 2015. The modification did not result in a gain or loss due to the related party nature of the transaction. The Company issued a Series N Warrant to purchase 767,000 shares of common stock at an exercise price of $3.38 through December 31, 2020. The fair value of the Series N Warrant was $2.102 per share, or $1,612,234 and was calculated using the Black-Scholes option pricing model and the following assumptions: market price of common stock - $3.24 per share; estimated volatility 82.00%; risk free interest rate - 1.76%; expected dividend rate - 0% and expected life - 5 years. As a result, the Company recorded a debt discount of $1,612,234 which is being accreted through December 31, 2017. The maturity date of the Series I Warrant to purchase 921,875 shares of common stock was extended from October 6, 2018 to December 31, 2020. The Company recorded $233,234 as a debt discount to recognize the increase in value for the extension of the expiration date. The increase in the fair value was calculated using the Black-Scholes option pricing model and the following assumptions: exercise price - $1.37; market price of common stock - $3.24 per share; estimated volatility 81.81%; risk free interest rate - 1.76%; expected dividend rate - 0% and expected life - 5 years as a result of the extension and 2.77 years remaining at the time of extension through December 31, 2017. The maturity date of the Series J Warrant to purchase 3,110,378 shares of common stock was extended from November 9, 2019 to December 31, 2020. The Company recorded $304,817 as a debt discount to recognize the increase in fair value for the extension of the expiration date. The increase in fair value was calculated using the Black-Scholes option pricing model and the following assumptions: exercise price - $1.12; market price of common stock - $3.24 per share; estimated volatility 81.81%; risk free interest rate - 1.76%; expected dividend rate - 0% and expected life - 5 years as a result of the extension and 3.86 years remaining at the time of extension. The debt discount is being accreted through December 31, 2017. The maturity date of the Series K Warrant to purchase 3,110,378 shares of common stock was extended from November 9, 2019 to December 31, 2020. The Company recorded $326,590 as a debt discount to recognize the increasein fair value for the extension of the expiration date. The increase in fair value was calculated using the Black-Scholes option pricing model and the following assumptions: exercise price - $1.20; market price of common stock - $3.24 per share; estimated volatility 81.81%; risk free interest rate - 1.76%; expected dividend rate - 0% and expected life - 5 years as a result of the extension and 3.86 years remaining at the time of extension. The debt discount is being accreted through December 31, 2017. Interest expense related to the 2013 Loan Agreement, as amended, amounted to $62,514 and $183,020 during the three and nine months ended May 31, 2016, respectively. Interest expense was $58,312 and $170,116 during the three and nine months ended May 31, 2015, respectively. Accretion of the debt discount related to the 2013 Loan Agreement as amended amounted to $311,727 and $1,394,836 during the three and nine months ended May 31, 2016, respectively. Accretion amounted to $663,462 and $3,770,410 during the three and nine months ended May 31, 2015, respectively. The remaining debt discount related to the Series N Warrants and Series I, J and K Warrant expiration date extensions totals $1,961,847 and will be amortized through December 31, 2017. |
Private Placement
Private Placement | 9 Months Ended |
May 31, 2016 | |
Notes to Financial Statements | |
Note 3. Private Placement | Beginning on February 18, 2016 and closing on March 31, 2016, the Company completed an offering pursuant to a Private Placement Memorandum dated February 16, 2016 (the " Offering PPM Unit PPM Units Series O Warrant Series P Warrant The terms of the Offering provided for a one time reset adjustment (the " Reset Adjustment Reset Price Reset Units |
Derivative Liability related to
Derivative Liability related to the Offering Units | 9 Months Ended |
May 31, 2016 | |
Notes to Financial Statements | |
Note 4. Derivative Liability related to the Offering Units | The Reset Adjustment contained in the Offering does not have fixed settlement provisions because the number of PPM Units issued may be adjusted higher if the Company sells securities at lower prices in the future; therefore, the Company concluded that the Reset Adjustment feature was not indexed to the Company's stock and is to be treated as a derivative liability for accounting purposes. The accounting treatment for derivative financial instruments requires that the Company allocate a portion of the equity proceeds to the derivative for an amount equal to its initial fair value. Subsequently, on each reporting date, the fair value of the derivative is measured with changes in value recorded to other income/expense. In determining the fair value of the derivative liabilities, the Company used a Monte Carlo simulation at the date the instrument was issued and at each quarter end until the termination date of the Reset Adjustment on September 30, 2016. A summary of quantitative information with respect to valuation methodology and significant unobservable inputs used for the Company's derivative liability that is categorized within Level 3 of the fair value hierarchy as of May 31, 2016 is as follows: May 31, 2016 Common stock issuable upon exercise of Series O Warrants 618,000 Common stock issuable upon exercise of Series P Warrants 309,000 Stock price $4.19 Volatility (Annual) 83% Strike price $3.10, Series O Warrants; $3.70, Series P Warrants Risk-free rate 0.78% Series O Warrants; 0.87%, Series P Warrants Term 1.42 years Series O Warrants; 1.91 years, Series P Warrants Probability of Reset Adjustment 100% The following table sets forth the Company's derivative liabilities that were accounted for at fair value on a recurring basis categorized within Level 3 of the fair value hierarchy as of May 31, 2016: Balance at August 31, 2015 Initial valuation of derivative liabilities upon issuance of new securities during the period Increase (decrease) in fair value of derivative liabilities Fair Value of derivatives upon reclass to additional paid-in capital Balance at May 31, 2016 Warrant liability $ - $ 1,714,395 $ 161,235 $ - $ 1,875,630 |
Common Stock and Warrants
Common Stock and Warrants | 9 Months Ended |
May 31, 2016 | |
Notes to Financial Statements | |
Note 5. Common Stock and Warrants | During the nine months ended May 31, 2016, the Company had the following common stock related transactions: · issued 282,106 shares upon the cashless exercise of 556,667 options. · issued 90,000 shares on January 5, 2016 to the Company's directors and consultants pursuant to the 2006 Plan valued at $3.75 per share, the closing price of the Company's common stock on the day the stock was granted (See "NOTE 8 - Related Party Transactions" below for additional information). · received $1,367,100 pursuant to the Offering (See "NOTE 3 Private Placement") and issued 441 PPM Units. · Converted loan principal of $548,700 from the December 2015 Loan Agreement in exchange for 177 PPM Units and issued 177,000 shares of common stock (See "NOTE 2 Debt"). Warrants Each of the Company's warrants outstanding entitles the holder to purchase one share of the Company's common stock for each warrant share held. A summary of the Company's warrants outstanding and exercisable as of May 31, 2016 and August 31, 2015 is as follows: Shares of Common Stock Issuable from Warrants Outstanding as of Weighted Average Description May 31, 2016 August 31, 2015 Exercise Price Expiration Series H - 3,906 $ 0.83 February 1, 2016 Series I 921,875 921,875 $ 1.37 December 31, 2020 Series J 3,110,378 3,110,378 $ 1.12 December 31, 2020 Series K 3,110,378 3,110,378 $ 1.20 December 31, 2020 Series L 500,000 500,000 $ 1.20 December 7, 2020 Series M 375,000 - $ 2.18 December 31, 2020 Series N 767,000 - $ 3.38 December 31, 2020 Series O 618,000 - $ 3.10 October 31, 2017 Series P 309,000 - $ 3.70 April 30, 2018 Total 9,711,631 7,646,537 Series H Warrants to purchase common stock were issued on February 1, 2013, in connection with the self-directed registered offering of 1,875,000 units. The remaining 3,906 Series H Warrants outstanding as of August 31, 2015 expired on February 1, 2016. The Series I Warrant was issued on October 7, 2013, in connection with the 2013 Loan Agreement. On December 31, 2015, as consideration for the Investor agreeing to extend the 2013 Note maturity date to December 31, 2017, the Company extended the maturity date of the Series I Warrant from October 6, 2018 to December 31, 2020. The Series J Warrant and Series K Warrant were issued on November 10, 2014 as a condition to the Investor entering into the 2015 Loan Agreement. On December 31, 2015, as consideration for the Investor agreeing to extend the 2013 Note maturity date to December 31, 2017, the Company extended the maturity date of the Series J and K Warrants from November 9, 2019 to December 31, 2020. The Series L Warrant was issued on March 4, 2015 in connection with the March 2015 Loan. On December 7, 2015, the expiration date of the Series L Warrant was extended from March 4, 2020 to December 7, 2020. A Series M Warrant, with an exercise price of $2.12, to purchase 275,000 shares was issued on December 7, 2015 in connection with the December 2015 Loan. A Series M Warrant, with an exercise price of $2.34, to purchase 100,000 shares was issued on December 7, 2015 as an inducement for Creditor to extend the maturity date of the March 2015 Loan from September 4, 2015 to December 21, 2016. The Series N Warrant to purchase 767,000 shares was issued on December 31, 2015 pursuant to the 2015 Second Amended Loan Agreement as an inducement for the Investor to extend the maturity date of the 2013 Note from December 31, 2015 to December 31, 2017. The Series O and Series P Warrant were issued in connection with the Offering described above under "NOTE 3 Private Placement". There are a total of approximately 2,631,845 warrants issuable pursuant to the 2013 Loan Agreement as described above under "NOTE 2 - Debt." |
Stock Options
Stock Options | 9 Months Ended |
May 31, 2016 | |
Notes to Financial Statements | |
Note 6. Stock Options | Stock option grants pursuant to the 2006 Plan vest either immediately or over one to five years and expire ten years after the date of grant. Stockholders previously approved 5,000,000 shares for grant under the 2006 Plan, of which 3,216,665 remain available for grant and 883,334 were issued pursuant to the exercise of vested options as of May 31, 2016. All shares approved for grant and subsequently forfeited are available for future grant. The Company does not repurchase shares to fulfill the requirements of options that are exercised. The Company issues new shares when options are exercised. The Company employs the following key weighted-average assumptions in determining the fair value of stock options, using the Black-Scholes option pricing model and the simplified method to estimate the expected term of "plain vanilla" options: Nine Months Ended May 31, 2016 Expected dividend yield Expected stock price volatility 82 % Risk-free interest rate 2.06 % Expected term (in years) 7.67 Exercise price $ 3.46 Weighted-average grant date fair-value $ 2.64 A summary of the Company's stock option activity for the nine months ended May 31, 2016 and year ended August 31, 2015 and related information follows: Number of Shares Subject to Option Grants Weighted Average Exercise Price ($) Weighted Average Remaining Contractual Term Aggregate Intrinsic Value ($) Outstanding at August 31, 2014 1,325,837 2.68 Grants 15,000 1.40 Forfeitures (73,335 ) 2.46 Outstanding at August 31, 2015 1,267,502 2.68 Grants 65,000 3.46 Forfeitures (55,834 ) 3.23 Exercises (556,667 ) 2.22 Outstanding at May 31, 2016 720,001 3.06 7.51 years 885,900 Exercisable at May 31, 2016 175,001 3.41 6.55 years 208,050 Available for grant at May 31, 2016 3,216,665 The aggregate intrinsic value in the table above represents the total pretax intrinsic value for all "in-the-money" options (i.e. the difference between the Company's closing stock price on the last trading day of the period covered by this report and the exercise price, multiplied by the number of shares) that would have been received by the option holders had all in-the-money option holders exercised their vested options on May 31, 2016. The intrinsic value of the option changes based upon the fair market value of the Company's common stock. Since the closing stock price was $4.19 on May 31, 2016 and 670,000 outstanding options have an exercise price below $4.19 per share, as of May 31, 2016, there is intrinsic value to the Company's outstanding, in-the-money stock options. The following table sets forth the share-based compensation cost resulting from stock option grants, including those previously granted and vesting over time, that were recorded in the Company's Consolidated Statements of Operations for the three and nine months ended May 31, 2016 and 2015: Three Months Ended May 31, Nine Months Ended May 31, 2016 2015 2016 2015 Stock Compensation Expense: SG&A $ 46,680 $ 85,125 $ 173,898 $ 351,109 R&D 18,700 1,658 78,658 14,628 Total $ 65,380 $ 86,783 $ 252,556 $ 365,737 As of May 31, 2016, the Company had $201,923 of unrecognized compensation cost related to unvested stock options which is expected to be recognized over a period of 2.50 years. The following table summarizes information about stock options outstanding and exercisable at May 31, 2016: Stock Options Outstanding Stock Options Exercisable Range of Exercise Prices Number of Shares Subject to Outstanding Options Weighted Average Contractual Life (years) Weighted Average Exercise Price Number of Shares Subject To Options Exercise Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price $ 0.80 15,000 6.56 $ 0.80 15,000 6.56 $ 0.80 1.40 15,000 8.55 1.40 15,000 8.55 1.40 2.50 10,000 4.85 2.50 10,000 4.85 2.50 2.90 565,000 7.65 2.90 65,000 7.65 2.90 3.46 65,000 9.60 3.46 20,000 9.60 3.46 4.98 16,667 1.78 4.98 16,667 1.78 4.98 5.94 33,334 4.57 5.94 33,334 4.57 5.94 Total 720,001 7.51 $ 3.06 175,001 6.55 $ 3.41 |
Net Loss Per Share
Net Loss Per Share | 9 Months Ended |
May 31, 2016 | |
Notes to Financial Statements | |
Note 7. Net Loss Per Share | During the three and nine months ended May 31, 2016 and 2015, the Company recorded a net loss. Basic net loss per share is computed by dividing the net loss by the weighted average number of common shares outstanding during the period. The Company has not included the effects of warrants, stock options and convertible debt on net loss per share because to do so would be antidilutive. Following is the computation of basic and diluted net loss per share for the three and nine months ended May 31, 2016 and 2015: Three Months Ended May 31, Nine Months Ended May 31, 2016 2015 2016 2015 Loss available to common stockholders' $ (2,099,885 ) $ (1,564,362 ) $ (5,232,917 ) $ (6,344,558 ) Weighted average number of common shares outstanding 27,427,913 25,224,700 26,957,191 24,823,496 $ (0.08 ) $ (0.06 ) $ (0.19 ) $ (0.26 ) Stock options 720,001 1,267,502 720,001 1,267,502 Warrants 9,711,631 8,793,851 9,711,631 8,793,851 Convertible debt 2,631,845 2,454,939 2,631,845 2,454,939 Warrants issuable upon conversion of debt (See "NOTE 2 - Convertible Promissory Note" above) 2,631,845 2,454,939 2,631,845 2,454,939 Total shares not included in the computation of diluted losses per share 15,695,322 14,971,231 15,695,322 14,971,231 |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
May 31, 2016 | |
Notes to Financial Statements | |
Note 8. Related Party Transactions | A related party with respect to the Company is generally defined as any person (i) (and, if a natural person, inclusive of his or her immediate family) that holds 10% or more of the Company's securities, (ii) that is part of the Company's management, (iii) that directly or indirectly controls, is controlled by or is under common control with the Company, or (iv) who can significantly influence the financial and operating decisions of the Company. A transaction is considered to be a related party transaction when there is a transfer of resources or obligations between related parties. For services rendered in the capacity of a Board member, non-employee Board members received $4,250 per quarter through November 30, 2015, increasing to $4,500 per quarter thereafter. During the three months ended May 31, 2016 and 2015, the Company incurred $9,000 and $8,500, respectively in cash based Board compensation. During the nine months ended May 31, 2016 and 2015, the Company incurred $26,500 and $25,500, respectively in cash based Board compensation. The Company grants stock options and common stock for services rendered by certain individuals, including the Company's non-employee directors and sole officer, Mr. Conklin. During the three months ended May 31, 2016 and 2015, the Company recognized net compensation expense related to stock options issued to our non-employee directors and executive of $43,380 and $84,198, respectively. During the nine months ended May 31, 2016 and 2015, the Company recognized net compensation expense related to stock options issued to our non-employee directors and executive of $153,270 and $343,108, respectively. During the three months ended May 31, 2016 and 2015, the Company recognized no compensation expense related to restricted stock issued to our non-employee directors and executive. During the nine months ended May 31, 2016 and 2015 the Company recognized compensation expense related to restricted stock issued to the Company's non-employee directors and executive of $337,500 and $84,000, respectively. The law firm of Sierchio & Partners, LLP (formerly Sierchio & Company, LLP), of which Joseph Sierchio, one of the Company's directors, is a principal, has provided counsel to the Company since its inception. During the three months ended May 31, 2016 and 2015, the law firm of Sierchio & Partners, LLP provided $73,730 and $88,945, respectively, of legal services. During the nine months ended May 31, 2016 and 2015, the law firm of Sierchio & Partners, LLP provided $221,324 and $92,997, respectively, of legal services. At May 31, 2016, the Company owed Sierchio & Partners, LLP $73,730 which is included in accounts payable. On October 7, 2013, the Company entered into the 2013 Loan Agreement with the Investor. On November 10, 2014, the Company and the Investor entered into the 2015 Loan Agreement resulting in the extension of the 2013 Note's maturity date to December 31, 2015 and the issuance of a Series J Warrant to purchase 3,110,378 shares of our common stock and a Series K Warrant to purchase 3,110,378 shares of our common stock. On December 31, 2015, the Company entered into the 2015 Second Amended Loan Agreement with the Investor resulting in the extension of the 2013 Note's maturity date to December 31, 2017 and the issuance of a Series N Warrant to purchase 767,000 shares of our common stock. Additionally, as consideration for the Investor agreeing to extend the 2013 Note maturity date to December 31, 2017, the Company extended the maturity date of the Series I Warrant to purchase 921,875 shares of common stock from October 6, 2018 to December 31, 2020, and extended the maturity date of the Series J Warrant to purchase 3,110,378 shares of common stock and Series K Warrant to purchase 3,110,378 shares of common stock from November 9, 2019 to December 31, 2020. For more information, see "NOTE 2 - Debt" above. On December 7, 2015, the Company entered into a Bridge Loan Agreement with the Investor pursuant to which the Company may borrow up to $550,000; of which $400,000 was advanced on October 7, 2015 and $150,000 on December 22, 2015 (each advance includes an additional $5 related to wire fees). As a condition to the Investor's entry into the December 2015 Loan Agreement, the Company issued the Investor a Series M Stock Purchase Warrant to purchase up to 275,000 shares of the Company's common stock for a period of five years, with an exercise price of $2.34. Additionally, as consideration for the Investor agreeing to extend the 2013 Note maturity date to December 31, 2017, the Company extended the maturity date of the Series M Warrant to purchase 275,000 shares of common stock from December 7, 2020 to December 31, 2020. For more information, see "NOTE 2 Debt" above. During the nine months ended May 31, 2016, the Investor purchased 250 PPM Units related to the February 2016 Private Placement Offering resulting in the Company receiving $775,000. Additionally, the Investor converted $548,700 of principal owed under the December 2015 Loan Agreement in exchange for 177 PPM units. As a result, the Company issued 427,000 shares of common stock, 427,000 Series O Warrants, and 213,500 Series P Warrants. For more information, see "NOTE 2 Debt" and "NOTE 3 Private Placement" above. During 2015, the Company received $765,156 upon the Investor's exercise of 921,875 Series H Warrants, for an equal number of shares, originally issued on February 1, 2013 pursuant to the Company's $1.2 million self-directed financing. During the nine months ended May 31, 2016, the Company received and repaid a short term cash advance from the Investor totaling $25,720. All related party transactions are recorded at the exchange amount established and agreed to between related parties and are in the normal course of business. |
Subsequent Events
Subsequent Events | 9 Months Ended |
May 31, 2016 | |
Notes to Financial Statements | |
Note 9. Subsequent Events | Management has reviewed material events subsequent of the quarterly period ended May 31, 2016 and prior to the filing of financial statements in accordance with FASB ASC 855 "Subsequent Events". On June 20, 2016, the Company completed a self-directed offering of 937,500 units at a price of $3.20 per unit for $3,000,000 in aggregate proceeds (the " June 2016 Private Placement The relative fair value of the common stock was estimated to be $1,338,000. The relative fair value of the Series Q Warrants and Series R Warrants was estimated to be $783,000 and $879,000, respectively, as determined based on the relative fair value allocation of the proceeds received. The Series Q Warrants were valued using the Black-Scholes option pricing model using the following variables: market price of common stock - $3.99 per share; estimated volatility 83%; 3-year risk free interest rate 0.87%; expected dividend rate - 0% and expected life - 3 years. The Series R Warrants were also valued using the Black-Scholes option pricing model using the following variables: market price of common stock - $3.99 per share; estimated volatility 83%; 5-year risk free interest rate 1.17%; expected dividend rate - 0% and expected life - 5 years. |
Basis of Presentation, Organi16
Basis of Presentation, Organization, Recent Accounting Pronouncements and Going Concern (Policies) | 9 Months Ended |
May 31, 2016 | |
Basis Of Presentation Organization Recent Accounting Pronouncements And Going Concern Policies | |
Basis of Presentation | The unaudited financial statements of SolarWindow Technologies, Inc. (the " Company GAAP KEC New Energy Solar |
Organization | SolarWindow Technologies, Inc. was incorporated in the State of Nevada on May 5, 1998, under the name "Octillion Corp." On December 2, 2008, the Company amended its Articles of Incorporation to effect a change of name to New Energy Technologies, Inc. Effective as of March 9, 2015, the Company amended its Articles of Incorporation to change its name to SolarWindow Technologies, Inc. The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, KEC and New Energy Solar. KEC was incorporated on June 19, 2008, in the State of Nevada and holds the patents related to the Company's MotionPower technology. The Company's business activities related to the MotionPower technology are conducted through KEC. New Energy Solar was incorporated on February 9, 2009, in the State of Florida and entered into agreements with The University of South Florida Research Foundation (" USF On March 9, 2015, the Company changed its name to "SolarWindow Technologies, Inc." to align the company name with its brand identity. The Company's ticker symbol changed to WNDW. The Company has been developing two sustainable electricity generating systems. These novel technologies are branded as SolarWindow and MotionPower. On March 2, 2015, the Company announced its exclusive focus on SolarWindow. The Company's SolarWindow technology provides the ability to harvest light energy from the sun and artificial sources and generate electricity from a transparent coating of organic photovoltaic solar cells. The Company's SolarWindow transparent electricity generating coatings are the subject of patent pending technologies. Initially being developed for application on glass surfaces, SolarWindow coatings could potentially be used on any of the more than 85 million commercial and residential buildings in the United States alone. The Company's SolarWindow product development programs involve ongoing research and development efforts, and the commitment of significant resources to support the extensive invention, design, engineering, testing, prototyping, and intellectual property initiatives carried-out by its contract engineers, scientists, and consultants. As such, the Company's activities are subject to significant risks and uncertainties, including failing to secure additional funding to commercialize the Company's SolarWindow technology before another company develops a similar technology and products. |
Recent Accounting Pronouncements | In April 2015, the FASB issued ASU 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs, which requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. This ASU requires retrospective adoption and will be effective for fiscal years beginning after December 15, 2015 and for interim periods within those fiscal years. We expect the adoption of this guidance will not have a material impact on our financial statements. In February 2015, the FASB issued ASU 2015-02, Amendments to the Consolidation Analysis, which amends the consolidation requirements in ASC 810 and significantly changes the consolidation analysis required under U.S. GAAP relating to whether or not to consolidate certain legal entities. Early adoption is permitted. The Company's effective date for adoption is January 1, 2016. The Company does not expect this accounting update to have a material effect on its consolidated financial statements in future periods, although that could change. On May 28, 2014, FASB issued ASU 2014-09, Revenue from Contracts with Customers, Topic 606, requiring an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The updated standard will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective and permits the use of either the retrospective or cumulative effect transition method. Early adoption is not permitted. The standard is effective for annual periods beginning after December 15, 2017. The Company has not yet selected a transition method and does not expect this accounting update to have a material effect on its consolidated financial statements in future periods. The Company reviews new accounting standards as issued. Although some of these accounting standards issued or effective after the end of the Company's previous fiscal year may be applicable, the Company has not identified any standards that the Company believes merit further discussion. The Company believes that none of the new standards will have a significant impact on the financial statements. |
Going Concern | The Company does not have any commercialized products and has not generated any revenue since inception. The Company has an accumulated deficit of $34,271,931 and cash of $123,541 as of May 31, 2016, and does not have positive cash flows from operating activities. The accompanying consolidated financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America, which contemplates continuation of the Company as a going concern, which is dependent upon the Company's ability to establish itself as a profitable business. Subsequent to quarter end, the Company, on June 20, 2016, received $3,000,000 from the sale of 937,500 units pursuant to a private placement of its securities (the " June 2016 Private Placement If adequate funds are not available on reasonable terms, or at all, it would result in a material adverse effect on the Company's business, operating results, financial condition and prospects. In particular, the Company may be required to delay, reduce the scope of or terminate its research programs, sell rights to its SolarWindow technology and/or MotionPower technology or other technologies or products based upon such technologies, or license the rights to such technologies or products on terms that are less favorable to the Company than might otherwise be available. In view of these conditions, the ability of the Company to continue as a going concern is in substantial doubt and dependent upon achieving a profitable level of operations and on the ability of the Company to obtain necessary financing to fund ongoing operations. These consolidated financial statements do not give effect to any adjustments which will be necessary should the Company be unable to continue as a going concern and therefore be required to realize its assets and discharge its liabilities in other than the normal course of business and at amounts different from those reflected in the accompanying consolidated financial statements. |
Derivative Liability related 17
Derivative Liability related to the Offering Units (Tables) | 9 Months Ended |
May 31, 2016 | |
Derivative Liability Related To Offering Units Tables | |
Summary of quantitative information derivative liability | A summary of quantitative information with respect to valuation methodology and significant unobservable inputs used for the Company's derivative liability that is categorized within Level 3 of the fair value hierarchy as of May 31, 2016 is as follows: May 31, 2016 Common stock issuable upon exercise of Series O Warrants 618,000 Common stock issuable upon exercise of Series P Warrants 309,000 Stock price $4.19 Volatility (Annual) 83% Strike price $3.10, Series O Warrants; $3.70, Series P Warrants Risk-free rate 0.78% Series O Warrants; 0.87%, Series P Warrants Term 1.42 years Series O Warrants; 1.91 years, Series P Warrants Probability of Reset Adjustment 100% |
Fair value of derivative liabilities | The following table sets forth the Company's derivative liabilities that were accounted for at fair value on a recurring basis categorized within Level 3 of the fair value hierarchy as of May 31, 2016: Balance at August 31, 2015 Initial valuation of derivative liabilities upon issuance of new securities during the period Increase (decrease) in fair value of derivative liabilities Fair Value of derivatives upon reclass to additional paid-in capital Balance at May 31, 2016 Warrant liability $ - $ 1,714,395 $ 161,235 $ - $ 1,875,630 |
Common Stock and Warrants (Tabl
Common Stock and Warrants (Tables) | 9 Months Ended |
May 31, 2016 | |
Common Stock And Warrants Tables | |
Warrants outstanding and exercisable | A summary of the Company's warrants outstanding and exercisable as of May 31, 2016 and August 31, 2015 is as follows: Shares of Common Stock Issuable from Warrants Outstanding as of Weighted Average Description May 31, 2016 August 31, 2015 Exercise Price Expiration Series H - 3,906 $ 0.83 February 1, 2016 Series I 921,875 921,875 $ 1.37 December 31, 2020 Series J 3,110,378 3,110,378 $ 1.12 December 31, 2020 Series K 3,110,378 3,110,378 $ 1.20 December 31, 2020 Series L 500,000 500,000 $ 1.20 December 7, 2020 Series M 375,000 - $ 2.18 December 31, 2020 Series N 767,000 - $ 3.38 December 31, 2020 Series O 618,000 - $ 3.10 October 31, 2017 Series P 309,000 - $ 3.70 April 30, 2018 Total 9,711,631 7,646,537 |
Stock Options (Tables)
Stock Options (Tables) | 9 Months Ended |
May 31, 2016 | |
Stock Options Tables | |
Fair value of each option award | Nine Months Ended May 31, 2016 Expected dividend yield Expected stock price volatility 82 % Risk-free interest rate 2.06 % Expected term (in years) 7.67 Exercise price $ 3.46 Weighted-average grant date fair-value $ 2.64 |
Stock option activity | A summary of the Company's stock option activity for the nine months ended May 31, 2016 and year ended August 31, 2015 and related information follows: Number of Shares Subject to Option Grants Weighted Average Exercise Price ($) Weighted Average Remaining Contractual Term Aggregate Intrinsic Value ($) Outstanding at August 31, 2014 1,325,837 2.68 Grants 15,000 1.40 Forfeitures (73,335 ) 2.46 Outstanding at August 31, 2015 1,267,502 2.68 Grants 65,000 3.46 Forfeitures (55,834 ) 3.23 Exercises (556,667 ) 2.22 Outstanding at May 31, 2016 720,001 3.06 7.51 years 885,900 Exercisable at May 31, 2016 175,001 3.41 6.55 years 208,050 Available for grant at May 31, 2016 3,216,665 |
Share-based compensation cost | Three Months Ended May 31, Nine Months Ended May 31, 2016 2015 2016 2015 Stock Compensation Expense: SG&A $ 46,680 $ 85,125 $ 173,898 $ 351,109 R&D 18,700 1,658 78,658 14,628 Total $ 65,380 $ 86,783 $ 252,556 $ 365,737 |
Stock options outstanding and exercisable | The following table summarizes information about stock options outstanding and exercisable at May 31, 2016: Stock Options Outstanding Stock Options Exercisable Range of Exercise Prices Number of Shares Subject to Outstanding Options Weighted Average Contractual Life (years) Weighted Average Exercise Price Number of Shares Subject To Options Exercise Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price $ 0.80 15,000 6.56 $ 0.80 15,000 6.56 $ 0.80 1.40 15,000 8.55 1.40 15,000 8.55 1.40 2.50 10,000 4.85 2.50 10,000 4.85 2.50 2.90 565,000 7.65 2.90 65,000 7.65 2.90 3.46 65,000 9.60 3.46 20,000 9.60 3.46 4.98 16,667 1.78 4.98 16,667 1.78 4.98 5.94 33,334 4.57 5.94 33,334 4.57 5.94 Total 720,001 7.51 $ 3.06 175,001 6.55 $ 3.41 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 9 Months Ended |
May 31, 2016 | |
Net Loss Per Share Tables | |
Computation of basic and diluted net loss per share | Following is the computation of basic and diluted net loss per share for the three and nine months ended May 31, 2016 and 2015: Three Months Ended May 31, Nine Months Ended May 31, 2016 2015 2016 2015 Loss available to common stockholders' $ (2,099,885 ) $ (1,564,362 ) $ (5,232,917 ) $ (6,344,558 ) Weighted average number of common shares outstanding 27,427,913 25,224,700 26,957,191 24,823,496 $ (0.08 ) $ (0.06 ) $ (0.19 ) $ (0.26 ) Stock options 720,001 1,267,502 720,001 1,267,502 Warrants 9,711,631 8,793,851 9,711,631 8,793,851 Convertible debt 2,631,845 2,454,939 2,631,845 2,454,939 Warrants issuable upon conversion of debt (See "NOTE 2 - Convertible Promissory Note" above) 2,631,845 2,454,939 2,631,845 2,454,939 Total shares not included in the computation of diluted losses per share 15,695,322 14,971,231 15,695,322 14,971,231 |
Basis of Presentation, Organi21
Basis of Presentation, Organization, Recent Accounting Pronouncements and Going Concern (Details Narrative) - USD ($) | May 31, 2016 | Aug. 31, 2015 | May 31, 2015 | Aug. 31, 2014 |
Organization And Going Concern Details Narrative | ||||
Accumulated deficit | $ (34,271,931) | $ (29,039,014) | ||
Cash and cash equivalents | $ 123,541 | $ 228,465 | $ 69,169 | $ 785,237 |
Debt (Details Narrative)
Debt (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
May 31, 2016 | May 31, 2015 | May 31, 2016 | May 31, 2015 | |
Interest expense | $ 78,931 | $ 68,438 | $ 233,370 | $ 180,242 |
Accretion of debt discount | (683,574) | (806,821) | (1,967,895) | (3,913,769) |
Bridge Loan [Member] | ||||
Interest expense | 5,077 | 17,149 | ||
Accretion of debt discount | 315,515 | 458,777 | ||
Bridge Loan One [Member] | ||||
Interest expense | 11,341 | 10,126 | 33,201 | 10,126 |
Accretion of debt discount | 56,332 | 143,359 | 114,282 | 143,359 |
Convertible Promissory Note [Member] | ||||
Interest expense | 62,514 | 58,312 | 183,020 | 170,116 |
Accretion of debt discount | $ 311,727 | $ 663,462 | $ 1,394,836 | $ 3,770,410 |
Derivative Liability related 23
Derivative Liability related to the Offering Units (Details) | 9 Months Ended |
May 31, 2016$ / sharesshares | |
Common stock issuable upon exercise of Series O Warrants | shares | 618,000 |
Common stock issuable upon exercise of Series P Warrants | shares | 309,000 |
Stock price | $ 4.19 |
Volatility (Annual) | 83.00% |
Probability of Reset Adjustment | 100.00% |
Series O Warrants [Member] | |
Strike price | $ 3.10 |
Risk-free rate | 0.78% |
Maturity date | 1 year 5 months 1 day |
Series P Warrants [Member] | |
Strike price | $ 3.70 |
Risk-free rate | 0.87% |
Maturity date | 1 year 10 months 28 days |
Derivative Liability related 24
Derivative Liability related to the Offering Units (Details 1) | 9 Months Ended |
May 31, 2016USD ($) | |
Derivative Liability Related To Offering Units Details 1 | |
Beginning balance, warrant liability | |
Initial valuation of derivative liabilities upon issuance of new securities during the period | 1,714,395 |
Increase (decrease) in fair value of derivative liabilities | 161,235 |
Fair value of derivatives upon reclass to additional paid-in capital | |
Ending balance, warrant liability | $ 1,875,630 |
Common Stock and Warrants (Deta
Common Stock and Warrants (Details) - $ / shares | 9 Months Ended | |
May 31, 2016 | Aug. 31, 2015 | |
Shares of Common Stock Issuable from Warrants | 9,711,631 | 7,646,537 |
Series J [Member] | ||
Shares of Common Stock Issuable from Warrants | 3,110,378 | |
Series K [Member] | ||
Shares of Common Stock Issuable from Warrants | 3,110,378 | |
Series L [Member] | ||
Shares of Common Stock Issuable from Warrants | 500,000 | |
Series H [Member] | ||
Shares of Common Stock Issuable from Warrants | 3,906 | |
Exercise Price | $ 0.83 | |
Expiration | Feb. 1, 2016 | |
Series I [Member] | ||
Shares of Common Stock Issuable from Warrants | 921,875 | 921,875 |
Exercise Price | $ 1.37 | |
Expiration | Dec. 31, 2020 | |
Series J [Member] | ||
Shares of Common Stock Issuable from Warrants | 3,110,378 | |
Exercise Price | $ 1.12 | |
Expiration | Dec. 31, 2020 | |
Series K [Member] | ||
Shares of Common Stock Issuable from Warrants | 3,110,378 | |
Exercise Price | $ 1.20 | |
Expiration | Dec. 31, 2020 | |
Series L [Member] | ||
Shares of Common Stock Issuable from Warrants | 500,000 | |
Exercise Price | $ 1.20 | |
Expiration | Dec. 7, 2020 | |
Series M [Member] | ||
Shares of Common Stock Issuable from Warrants | 375,000 | |
Exercise Price | $ 2.18 | |
Expiration | Dec. 31, 2020 | |
Series N [Member] | ||
Shares of Common Stock Issuable from Warrants | 767,000 | |
Exercise Price | $ 3.38 | |
Expiration | Dec. 31, 2020 | |
Series O [Member] | ||
Shares of Common Stock Issuable from Warrants | 618,000 | |
Exercise Price | $ 3.10 | |
Expiration | Oct. 31, 2017 | |
Series P [Member] | ||
Shares of Common Stock Issuable from Warrants | 309,000 | |
Exercise Price | $ 3.70 | |
Expiration | Apr. 30, 2018 |
Common Stock and Warrants (De26
Common Stock and Warrants (Details Narrative) - USD ($) | 9 Months Ended | |
May 31, 2016 | May 31, 2015 | |
Common Stock And Warrants Details Narrative | ||
Cashless exercise options | 556,667 | |
Common stock, shares issued during period | 282,106 | |
Amount received upon the exercise of warrants | $ 1,367,100 | $ 501,242 |
Stock Options (Details)
Stock Options (Details) - USD ($) | 9 Months Ended | 12 Months Ended |
May 31, 2016 | Aug. 31, 2015 | |
Stock Options Details | ||
Expected dividend yield | ||
Expected stock price volatility | 82.00% | |
Risk-free interest rate | 2.06% | |
Expected term (in years) | 7 years 8 months 1 day | |
Exercise price | $ 3.46 | $ 1.40 |
Weighted-average grant date fair-value | $ 2.64 |
Stock Options (Details 1)
Stock Options (Details 1) - USD ($) | 9 Months Ended | 12 Months Ended |
May 31, 2016 | Aug. 31, 2015 | |
Number of Options | ||
Outstanding Beginning | 1,267,502 | 1,325,837 |
Grants | 65,000 | 15,000 |
Forfeitures | (55,834) | (73,335) |
Exercises | (556,667) | |
Outstanding Ending | 720,001 | 1,267,502 |
Exercisable Ending | 175,001 | |
Available for grant Ending | 3,216,665 | |
Weighted Average Exercise Price ($) | ||
Weighted-average exercise price Beginning | $ 2.68 | $ 2.68 |
Grants | 3.46 | 1.40 |
Forfeitures | 3.23 | 2.46 |
Exercises | 2.22 | |
Weighted-average exercise price Ending | 3.06 | $ 2.68 |
Exercisable Ending | $ 3.41 | |
Weighted Average Remaining Contractual Term | ||
Outstanding Ending | 7 years 6 months 4 days | |
Exercisable Ending | 6 years 6 months 18 days | |
Aggregate Intrinsic Value ($) | ||
Outstanding Ending | $ 885,900 | |
Exercisable Ending | $ 208,050 |
Stock Options (Details 2)
Stock Options (Details 2) - USD ($) | 3 Months Ended | 9 Months Ended | ||
May 31, 2016 | May 31, 2015 | May 31, 2016 | May 31, 2015 | |
Stock Compensation Expense: | ||||
Selling, general and administrative | $ 46,680 | $ 85,125 | $ 173,898 | $ 351,109 |
Research and development | 18,700 | 1,658 | 78,658 | 14,628 |
Total | $ 65,380 | $ 86,783 | $ 252,556 | $ 365,737 |
Stock Options (Details 3)
Stock Options (Details 3) - $ / shares | 9 Months Ended | ||
May 31, 2016 | Aug. 31, 2015 | Aug. 31, 2014 | |
Number of Shares Subject to Outstanding Options | 720,001 | 1,267,502 | 1,325,837 |
Weighted average contractural life (years) | 7 years 6 months 4 days | ||
Weighted-average exercise price | $ 3.06 | $ 2.68 | $ 2.68 |
Number of Shares Subject to options exercisable | 175,001 | ||
Weighted average contractural life (years) of options exercisable | 6 years 6 months 18 days | ||
Weighted-average exercise price of options exercisable | $ 3.41 | ||
$0.80 Per Share [Member] | |||
Number of Shares Subject to Outstanding Options | 15,000 | ||
Weighted average contractural life (years) | 6 years 6 months 22 days | ||
Weighted-average exercise price | $ 0.80 | ||
Number of Shares Subject to options exercisable | 15,000 | ||
Weighted average contractural life (years) of options exercisable | 6 years 6 months 22 days | ||
Weighted-average exercise price of options exercisable | $ 0.80 | ||
$1.40 Per Share [Member] | |||
Number of Shares Subject to Outstanding Options | 15,000 | ||
Weighted average contractural life (years) | 8 years 6 months 18 days | ||
Weighted-average exercise price | $ 1.40 | ||
Number of Shares Subject to options exercisable | 15,000 | ||
Weighted average contractural life (years) of options exercisable | 8 years 6 months 18 days | ||
Weighted-average exercise price of options exercisable | $ 1.40 | ||
$2.50 Per Share [Member] | |||
Number of Shares Subject to Outstanding Options | 10,000 | ||
Weighted average contractural life (years) | 4 years 10 months 6 days | ||
Weighted-average exercise price | $ 2.50 | ||
Number of Shares Subject to options exercisable | 10,000 | ||
Weighted average contractural life (years) of options exercisable | 4 years 10 months 6 days | ||
Weighted-average exercise price of options exercisable | $ 2.50 | ||
$2.90 Per Share [Member] | |||
Number of Shares Subject to Outstanding Options | 565,000 | ||
Weighted average contractural life (years) | 7 years 7 months 24 days | ||
Weighted-average exercise price | $ 2.90 | ||
Number of Shares Subject to options exercisable | 65,000 | ||
Weighted average contractural life (years) of options exercisable | 7 years 7 months 24 days | ||
Weighted-average exercise price of options exercisable | $ 2.90 | ||
$3.46 Per Share [Member] | |||
Number of Shares Subject to Outstanding Options | 65,000 | ||
Weighted average contractural life (years) | 9 years 7 months 6 days | ||
Weighted-average exercise price | $ 3.46 | ||
Number of Shares Subject to options exercisable | 20,000 | ||
Weighted average contractural life (years) of options exercisable | 9 years 7 months 6 days | ||
Weighted-average exercise price of options exercisable | $ 3.46 | ||
$4.98 Per Share [Member] | |||
Number of Shares Subject to Outstanding Options | 16,667 | ||
Weighted average contractural life (years) | 1 year 9 months 11 days | ||
Weighted-average exercise price | $ 4.98 | ||
Number of Shares Subject to options exercisable | 16,667 | ||
Weighted average contractural life (years) of options exercisable | 1 year 9 months 11 days | ||
Weighted-average exercise price of options exercisable | $ 4.98 | ||
$5.94 Per Share [Member] | |||
Number of Shares Subject to Outstanding Options | 33,334 | ||
Weighted average contractural life (years) | 4 years 6 months 26 days | ||
Weighted-average exercise price | $ 5.94 | ||
Number of Shares Subject to options exercisable | 33,334 | ||
Weighted average contractural life (years) of options exercisable | 4 years 6 months 26 days | ||
Weighted-average exercise price of options exercisable | $ 5.94 |
Stock Options (Details Narrativ
Stock Options (Details Narrative) | 9 Months Ended |
May 31, 2016USD ($)$ / sharesshares | |
Stock option available for grant shares | 3,216,665 |
Closing stock option exercise price | $ / shares | $ 4.19 |
Stock option outstanding | 670,000 |
Stock based compensation unrecognized | $ | $ 201,923 |
Expected period for recognition | 2 years 6 months |
2006 Incentive Stock Option Plan [Member] | |
Stock option approved | 5,000,000 |
Stock option available for grant shares | 3,216,665 |
Stock option exercise | 883,334 |
Net Loss Per Share (Details)
Net Loss Per Share (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
May 31, 2016 | May 31, 2015 | May 31, 2016 | May 31, 2015 | Aug. 31, 2015 | |
Numerator: | |||||
Loss available to common stockholders' | $ (2,099,885) | $ (1,564,362) | $ (5,232,917) | $ (6,344,558) | $ (8,092,744) |
Denominator: | |||||
Weighted average number of common shares outstanding | 27,427,913 | 25,224,700 | 26,957,191 | 24,823,496 | |
Basic and diluted EPS | $ (0.08) | $ (0.06) | $ (0.19) | $ (0.26) | |
The shares listed below were not included in the computation of diluted losses per share because to do so would have been antidilutive for the periods presented: | |||||
Stock options | 720,001 | 1,267,502 | 720,001 | 1,267,502 | |
Warrants | 9,711,631 | 8,793,851 | 9,711,631 | 8,793,851 | |
Convertible debt | 2,631,845 | 2,454,939 | 2,631,845 | 2,454,939 | |
Warrants issuable upon conversion of debt (See "NOTE 2 - Convertible Promissory Note" above) | 2,631,845 | 2,454,939 | 2,631,845 | 2,454,939 | |
Total shares not included in the computation of diluted losses per share | 15,695,322 | 14,971,231 | 15,695,322 | 14,971,231 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) | 3 Months Ended | 9 Months Ended | ||
May 31, 2016USD ($) | May 31, 2015USD ($) | May 31, 2016USD ($) | May 31, 2015USD ($) | |
Net compensation expense | $ 337,500 | $ 84,000 | ||
Proceed from private placement | $ 775,000 | |||
No. of units purchased | 153 | 153 | ||
Increase (decrease) in related party payable | $ 25,720 | |||
Board member [Member] | ||||
Net compensation expense | $ 9,000 | $ 8,500 | 26,500 | 25,500 |
Mr. Conklin [Member] | ||||
Net compensation expense | 43,380 | 84,198 | 153,270 | 343,108 |
Sierchio & Partners [Member] | ||||
Legal services | 73,730 | $ 88,945 | 221,324 | $ 92,997 |
Accounts payable | $ 73,730 | $ 73,730 |