Document_and_Entity_Informatio
Document and Entity Information | 6 Months Ended | |
Jun. 30, 2014 | Aug. 15, 2014 | |
Document And Entity Information | ' | ' |
Entity Registrant Name | 'TAPIMMUNE INC | ' |
Entity Central Index Key | '0001094038 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 30-Jun-14 | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--12-31 | ' |
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 | ' | 19,083,190 |
Document Fiscal Period Focus | 'Q2 | ' |
Document Fiscal Year Focus | '2014 | ' |
Balance_Sheets
Balance Sheets (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Current Assets | ' | ' |
Cash | $20,647 | $48,589 |
Prepaid expenses and deposits | 15,004 | 15,004 |
Deferred financing costs (Note 5) | ' | 13,439 |
Total Current Assets | 35,651 | 77,032 |
Current Liabilities | ' | ' |
Accounts payable and accrued liabilities (Note 12) | 1,212,541 | 3,778,401 |
Research agreement obligations (Note 3) | 492,365 | 492,365 |
Derivative liability - conversion option (Note 4) | ' | 582,300 |
Derivative liability - warrants (Note 4) | 298,459 | 140,504 |
Convertible notes payable (Note 5) | 356,950 | 3,161,977 |
Loans payable (Note 6) | 18,000 | 42,200 |
Promissory notes (Note 7) | 67,942 | 277,942 |
Due to related parties (Note 8) | 152,000 | 369,346 |
Total Current Liabilities | 2,598,257 | 8,845,035 |
Stockholders' Deficit | ' | ' |
Capital stock (Note 9) Common stock, $0.001 par value, 500,000,000 shares authorized 16,806,569 shares issued and outstanding (2013 - 1,465,711) | 160,021 | 144,672 |
Additional paid-in capital | 81,222,424 | 46,287,544 |
Shares to be issued | 493,875 | 284,750 |
Deficit accumulated during the development stage | -84,380,385 | -55,426,635 |
Accumulated other comprehensive loss | -58,541 | -58,334 |
Total Stockholders' Deficit | -2,562,606 | -8,768,003 |
Total Liabilities and Stockholders' Deficit | $35,651 | $77,032 |
Balance_Sheets_Parenthetical
Balance Sheets (Parenthetical) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Statement of Financial Position [Abstract] | ' | ' |
Common stock par value | $0.00 | $0.00 |
Common stock shares authorized | 500,000,000 | 500,000,000 |
Common stock shares issued | 16,806,569 | 1,465,711 |
Common stock shares outstanding | 16,806,569 | 1,465,711 |
Statements_of_Operations_Unaud
Statements of Operations (Unaudited) (USD $) | 3 Months Ended | 6 Months Ended | 179 Months Ended | ||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | |
EXPENSES | ' | ' | ' | ' | ' |
Consulting fees | $56,320 | $36,367 | $91,340 | $66,367 | $2,497,907 |
Consulting fees - stock-based (Note 9) | 105,325 | 15,956 | 791,575 | 83,768 | 8,915,051 |
Depreciation | ' | ' | ' | ' | 213,227 |
General and administrative | 109,377 | 88,114 | 303,715 | 295,432 | 4,809,262 |
Interest and finance charges (Note 4) | 32,553 | 291,212 | 67,822 | 626,100 | 7,289,471 |
Management fees (Note 8) | 58,500 | 58,500 | 117,000 | 117,000 | 3,455,303 |
Management fees - stock-based (Notes 8 and 9) | 3,750 | 11,926 | 7,500 | 27,489 | 4,503,487 |
Professional fees | 122,602 | 118,658 | 308,842 | 385,288 | 6,570,279 |
Research and development (Note 8) | 22,500 | 54,398 | 45,000 | 188,778 | 7,675,229 |
Research and development - stock-based | ' | ' | ' | ' | 612,000 |
Total Expenses | 510,927 | 675,131 | 1,732,794 | 1,790,222 | 46,541,216 |
LOSS BEFORE OTHER ITEMS | -510,927 | -675,131 | -1,732,794 | -1,790,222 | -46,541,216 |
OTHER ITEMS | ' | ' | ' | ' | ' |
Foreign exchange (loss) gain | ' | -6,637 | ' | 5,896 | 51,583 |
Changes in fair value of derivative liabilities (Note 4) | 352,834 | 781,321 | 14,537 | 1,878,489 | 5,865,186 |
Accretion of interest on convertible debt | -8,660 | ' | -492,296 | ' | -1,603,127 |
Loss on debt financing | ' | -96,000 | ' | ' | -1,373,263 |
Gain (loss) on settlement of debt (Note 9) | 920,233 | -874,358 | -26,743,197 | -1,310,400 | -40,994,043 |
Loss on lawsuit | ' | ' | ' | ' | -103,950 |
Gain on extinguishment of derivative liabilities - warrants (Note 4) | ' | ' | ' | ' | -290,500 |
Interest income | ' | ' | ' | ' | 33,344 |
Loss on disposal of assets | ' | ' | ' | ' | 5,399 |
NET INCOME (LOSS) | 753,480 | -870,805 | -28,953,750 | -1,312,237 | -84,380,385 |
Other comprehensive income (loss) | ' | ' | ' | ' | ' |
Foreign exchange translation adjustment | 1,042 | 4,647 | -207 | 3,205 | -58,541 |
TOTAL COMPREHENSIVE INCOME (LOSS) | $754,522 | ($866,158) | ($28,953,957) | ($1,309,032) | ($84,438,926) |
BASIC AND DILUTED NET INCOME (LOSS) PER SHARE | $0.05 | ($0.87) | ($2.57) | ($1.45) | ' |
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING, | 15,523,016 | 1,000,881 | 11,250,240 | 904,450 | ' |
Statements_of_Cash_Flows_Unaud
Statements of Cash Flows (Unaudited) (USD $) | 6 Months Ended | 179 Months Ended | |
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ' | ' | ' |
Net loss | ($28,953,750) | ($1,312,237) | ($84,380,385) |
Adjustments to reconcile net loss to net cash from operating activities: | ' | ' | ' |
Depreciation | ' | ' | 213,228 |
Non-cash loss on debt financing | ' | 96,000 | 1,373,263 |
Changes in fair value of derivative liabilities | -14,537 | -1,878,489 | -5,865,186 |
Loss on settlement of debt | 26,743,197 | 1,310,400 | 40,994,043 |
Gain on extinguishment of derivative liabilities - warrants | ' | ' | -290,500 |
Loss on disposal of assets | ' | ' | 5,399 |
Non-cash interest and financing charges | 492,296 | ' | 7,071,626 |
Stock based compensation | 799,075 | 111,257 | 14,046,788 |
Changes in operating assets and liabilities: | ' | ' | ' |
Due from government agency | ' | ' | -1,055 |
Prepaid expenses and deposits | ' | -103,950 | -39,004 |
Deferred financing costs | ' | 17,307 | 11,810 |
Accounts payable and accrued liabilities | 322,277 | 1,063,734 | 8,400,435 |
Research agreement obligations | ' | 76,367 | 710,496 |
NET CASH USED IN OPERATING ACTIVITIES | -611,442 | -619,611 | -17,749,042 |
CASH FLOWS FROM FINANCING ACTIVITIES | ' | ' | ' |
Issuance of shares, net | 583,000 | 235,951 | 11,443,575 |
Convertible notes, net | ' | 236,000 | 2,851,906 |
Proceeds from loans payable | 500 | ' | 460,700 |
Notes and loans payable | ' | ' | 919,845 |
Advances from (to) related parties | ' | 159,000 | 1,768,916 |
Repayment of convertible debentures | ' | ' | -20,000 |
Stock subscriptions | ' | ' | 140,000 |
NET CASH PROVIDED BY FINANCING ACTIVITIES | 583,500 | 630,951 | 17,564,942 |
CASH FLOWS FROM INVESTING ACTIVITIES | ' | ' | ' |
Purchase of furniture and equipment | ' | ' | -218,626 |
Cash acquired on reverse acquisition | ' | ' | 423,373 |
NET CASH PROVIDED BY INVESTING ACTIVITIES | ' | ' | 204,747 |
INCREASE (DECREASE) IN CASH | -27,942 | 11,340 | 20,647 |
CASH, BEGINNING OF PERIOD | 48,589 | 33,839 | ' |
CASH, END OF PERIOD | $20,647 | $45,179 | $20,647 |
NATURE_OF_OPERATIONS
NATURE OF OPERATIONS | 6 Months Ended |
Jun. 30, 2014 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' |
NATURE OF OPERATIONS | ' |
TapImmune Inc. (the “Company”), a Nevada corporation incorporated in 1992, is a clinical-stage immunotherapy specializing in the development of innovative peptide and gene-based immunotherapeutics and vaccines for the treatment of oncology and infectious disease. Unlike other vaccine technologies that narrowly address the initiation of an immune response, TapImmune's ("Prime" and "Boost") approach broadly stimulates the cellular immune system by enhancing the function of killer T-cells and T-helper cells and by restoring antigen presentation in tumor cells allowing their recognition and killing by the immune system. | |
These consolidated financial statements have been prepared on the basis of a going concern which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As at June 30, 2014, the Company had a working capital deficiency of $2,562,606 and has incurred significant losses since inception in the development of its business. Further losses are anticipated in the development stage raising substantial doubt as to the Company’s ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent on raising additional capital to fund clinical trials, ongoing research and development, maintenance and protection of patents, and ultimately on generating future profitable operations. Planned expenditures relating to current and future clinical trials of the Company’s immunotherapy vaccine will require significant additional funding. The Company is dependent on future financings to fund ongoing research and development as well as working capital requirements. The Company’s future capital requirements will depend on many factors including the rate and extent of scientific progress in its research and development programs, the timing, cost and scope involved in clinical trials, obtaining regulatory approvals, pursuing further patent protections and the timing and costs of commercialization activities. | |
Management is addressing going concern remediation through seeking new sources of capital, restructuring and retiring debt through conversion to equity and debt settlement arrangements with creditors, cost reduction programs and seeking possible joint venture participation. Management’s plans are intended to return the Company to financial stability and improve continuing operations. The Company is continuing initiatives to raise capital through private placements, related party loans and other institutional sources to meet immediate working capital requirements. | |
Additional funding was raised through equity and debt placements in 2013 and 2014, and in early 2014 the Company has completed significant restructuring of outstanding debt and equity instruments into equity. Additional capital is required to expand programs including pre-clinical work and to progress clinical trials for the lead vaccine candidates. Strategic partnerships will be needed to continue the product development portfolio and fund development costs. These measures, if successful, may contribute to reduce the risk of going concern uncertainties for the Company over the next twelve months. | |
There is no certainty that the Company will be able to arrange sufficient funding to continue development of products to marketability. | |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2014 | |
Accounting Policies [Abstract] | ' |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' |
Basis of Presentation | |
In the opinion of management, the accompanying balance sheets and related interim statements of operations and cash flows include all adjustments, consisting only of normal recurring items, necessary for their fair presentation in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Preparing financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, and expenses. Significant areas requiring management’s estimates and assumptions include deferred taxes and related tax balances and disclosures, determining the fair value of stock-based compensation and stock based transactions, the fair value of the components of the convertible notes payable, foreign exchange gains and losses, allocation of costs to research and development and accrued liabilities. Matters impacting the company’s ability to continue as a going concern and contingencies also involve the use of estimates and assumptions. | |
Interim results are not necessarily indicative of results for a full year. The information included in this quarterly report on Form 10-Q should be read in conjunction with information included in the Company’s annual report on Form 10-K/A filed on April 17, 2014, with the U.S. Securities and Exchange Commission. | |
RESEARCH_AGREEMENTS
RESEARCH AGREEMENTS | 6 Months Ended |
Jun. 30, 2014 | |
Research and Development [Abstract] | ' |
RESEARCH AGREEMENTS | ' |
Crucell Holland B.V. (“Crucell”) – Research License and Option Agreement | |
Effective August 7, 2003, Crucell and the Company’s subsidiary GPI entered into a five-year research license and option agreement. In addition, retroactively effective August 7, 2008, the Company negotiated an amended license agreement for the use of Crucell’s adenovirus technology. As at June 30, 2014, the Company accrued $492,365 (€378,384) under the amended agreement. | |
The Company has not made use of the Crucell technology in its current work and has not asked for nor received any work product. Management intends to settle the outstanding amounts with Crucell in 2014 and formally terminate the research license. | |
Mayo Clinic –License Option Agreement | |
For details regarding the license option agreement with Mayo Clinic, please refer to Note 11. | |
DERIVATIVE_WARRANT_LIABILITY_A
DERIVATIVE WARRANT LIABILITY AND FAIR VALUE | 6 Months Ended | ||||||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||||||
Notes to Financial Statements | ' | ||||||||||||||||||||
DERIVATIVE WARRANT LIABILITY AND FAIR VALUE | ' | ||||||||||||||||||||
The Company has evaluated the application ASC 480-10 Distinguishing liabilities from equity, ASC 815-40 Contracts in an Entity’s Own Equity and ASC 718-10 Compensation – Stock Compensation to the issued and outstanding warrants to purchase common stock that were issued with the convertible notes, private placements, consulting agreements, and various debt settlements during 2009 through 2012. Based on the guidance, management concluded these instruments are required to be accounted for as derivatives either due to a ratchet down protection feature available on the exercise price (Note 5) or a holder’s right to put the warrants back to the Company for cash under certain conditions or a conversion option feature with conversion into variable number of shares. Under ASC 815-40-25, the Company records the fair value of these warrants and conversion options (derivatives) on its balance sheet, at fair value, with changes in the values reflected in the statements of operations as “Changes in fair value of derivative liabilities”. The fair value of the share purchase warrants are recorded on the balance sheet under ‘Derivative liability – warrants’ and the fair value of the conversion options are recorded on the balance sheet under ‘Derivative liability – conversion option’. | |||||||||||||||||||||
ASC 820-10 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820-10 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820-10 describes three levels of inputs that may be used to measure fair value: Level 1 – Quoted prices in active markets for identical assets or liabilities; Level 2 – Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and Level 3 – Unobservable inputs that are supported by little or no market activity and that are financial instruments whose values are determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant judgment or estimation. The Company’s Level 3 liabilities consist of the derivative liabilities associated with the warrants and conversion options issued with the convertible notes during the year ended December 31, 2013. At June 30, 2014, all of the Company’s derivative liabilities were categorized as Level 3 fair value liabilities. If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument. | |||||||||||||||||||||
Level 3 Valuation Techniques | |||||||||||||||||||||
Financial liabilities are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable. Level 3 financial liabilities consist of the notes and warrants for which there is no current market for these securities such that the determination of fair value requires significant judgment or estimation. | |||||||||||||||||||||
Determining fair value of share purchase warrants and conversion options, given the Company’s stage of development and financial position, is highly subjective and identifying appropriate measurement criteria and models is subject to uncertainty. There are several generally accepted pricing models for warrants and options and derivative provisions. The Company has chosen to value the warrants and conversion option on the notes that contain ratchet down provisions using the Binomial model under the following assumptions: | |||||||||||||||||||||
31-Dec-13 | 30-Jun-14 | ||||||||||||||||||||
Expected Life (Years) | Risk free Rate | Dividend yield | Volatility | Expected Life (Years) | Risk free Rate | Dividend yield | Volatility | ||||||||||||||
Share purchase warrants | 0.85 to 2.78 | 0.13% to 0.78% | 0.00% | 199% | 0.35 to 2.28 | 0.04% to 0.47% | 0.00% | 199% | |||||||||||||
31-Dec-13 | 30-Jun-14 | ||||||||||||||||||||
Expected Life (Years) | Risk free Rate | Dividend yield | Volatility | Expected Life (Years) | Risk free Rate | Dividend yield | Volatility | ||||||||||||||
Conversion option | 0.16 to 0.53 | 0.04% to 0.10% | 0.00% | 199% | Nil | Nil | Nil | Nil | |||||||||||||
The foregoing assumptions are reviewed quarterly and are subject to change based primarily on management’s assessment of the probability of the events described occurring. Accordingly, changes to these assessments could materially affect the valuations. | |||||||||||||||||||||
Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis | |||||||||||||||||||||
Financial assets and liabilities measured at fair value on a recurring basis are summarized below and disclosed on the balance sheet under Derivative liability – warrants and Derivative liability – conversion option: | |||||||||||||||||||||
As of June 30, 2014 | |||||||||||||||||||||
Fair Value Measurements | |||||||||||||||||||||
Carrying Value | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||
Derivative liability - warrants | $ | 298,459 | - | - | $ | 298,459 | $ | 298,459 | |||||||||||||
Total | $ | 298,459 | - | - | $ | 298,459 | $ | 298,459 | |||||||||||||
As of December 31, 2013 | |||||||||||||||||||||
Fair Value Measurements | |||||||||||||||||||||
Carrying Value | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||
Derivative liability - warrants | $ | 140,504 | - | - | $ | 140,504 | $ | 140,504 | |||||||||||||
Derivative liability – conversion option | 582,300 | - | - | 582,300 | 582,300 | ||||||||||||||||
Total | $ | 722,804 | - | - | $ | 722,804 | $ | 722,804 | |||||||||||||
The table below provides a summary of the changes in fair value, including net transfers, in and/or out, of financial assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the Six Months Ended June 30, 2014 and the year ended December 31, 2013: | |||||||||||||||||||||
Fair Value Measurements Using Level 3 Inputs | |||||||||||||||||||||
Derivative liability - warrants | Derivative liability – conversion option | Total | |||||||||||||||||||
Balance, December 31, 2012 | 977,086 | 867,575 | 1,844,661 | ||||||||||||||||||
Additions during the year | 206,000 | 810,500 | 1,016,500 | ||||||||||||||||||
Total unrealized (gains) or losses included in net loss | (1,042,582 | ) | (1,095,775 | ) | (2,138,357 | ) | |||||||||||||||
Balance, December 31, 2013 | 140,504 | 582,300 | 722,804 | ||||||||||||||||||
Total unrealized (gains) or losses included in net loss | 157,955 | (582,300 | ) | (424,345 | ) | ||||||||||||||||
Balance, June 30, 2014 | $ | 298,459 | $ | - | $ | 298,459 | |||||||||||||||
The fair value of the warrants is determined using a Binomial option pricing model. The valuation of warrants is subjective and is affected by changes in inputs to the valuation model including the price per share of common stock, the historical volatility of the stock price, risk-free rates based on U.S. Treasury security yields, the expected term of the warrants and dividend yield. Changes in these assumptions can materially affect the fair value estimate. The Company could ultimately incur amounts to settle the warrant at a cash settlement value that is significantly different than the carrying value of the liability on the financial statements. The Company will continue to classify the fair value of the warrants as a liability until the warrants are exercised, expire, or are amended in a way that would no longer require these warrants to be classified as a liability. Changes in the fair value of the common stock warrants liability are recognized as a component of other income (expense) in the statement of operations. | |||||||||||||||||||||
The net cash settlement value at the time of any future Fundamental Transaction will depend upon the value of the following inputs at that time: the consideration value per share of the Company’s common stock, the volatility of the Company’s common stock, the remaining term of the warrant from announcement date, the risk-free interest rate based on U.S. Treasury security yields, and the Company’s dividend yield. The warrant requires use of a volatility assumption equal to the greater of 100% and the 100-day volatility function determined as of the trading day immediately following announcement of a Fundamental Transaction. The fair value of the warrants is determined using the American Binomial Option Pricing Model. | |||||||||||||||||||||
CONVERTIBLE_NOTES_PAYABLE
CONVERTIBLE NOTES PAYABLE | 6 Months Ended | ||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||
Debt Disclosure [Abstract] | ' | ||||||||||||||||
CONVERTIBLE NOTES PAYABLE | ' | ||||||||||||||||
The following is a summary of debt instrument transactions that are relevant to the current period: | |||||||||||||||||
Face Value | Principal Repayment/ | Unamortized | Balance at | ||||||||||||||
Settlement/Re-issued | Note | June 30, | |||||||||||||||
Discount | 2014 | ||||||||||||||||
February 2011 Secured Convertible Notes | |||||||||||||||||
Senior Secured Notes, due February 24, 2014 | $ | 980,830 | $ | 980,830 | $ | - | $ | - | |||||||||
April 2011 Secured Convertible Notes | |||||||||||||||||
Senior Secured Notes, due April 4, 2014 | 215,000 | 215,000 | - | - | |||||||||||||
June 2011 Secured Convertible Note | |||||||||||||||||
Senior Secured Notes, due June 6, 2014 | 30,000 | 30,000 | - | - | |||||||||||||
August 12, 2012 Convertible Note | |||||||||||||||||
Note became due November 12, 2012 | 27,500 | 27,500 | - | - | |||||||||||||
August 20, 2012 Convertible Note | |||||||||||||||||
Note due August 20, 2013 | 20,000 | 20,000 | - | - | |||||||||||||
October 2012 Convertible Note | |||||||||||||||||
Note due October 15, 2013 | 340,000 | - | - | 340,000 | |||||||||||||
November 20, 2012 Convertible Note | |||||||||||||||||
Note due November 20, 2013 | 10,748 | 10,748 | - | - | |||||||||||||
December 18, 2012 Convertible Note | |||||||||||||||||
Note due December 14, 2013 | 50,000 | 50,000 | - | - | |||||||||||||
January 5, 2013 Convertible Notes | 452,729 | 452,729 | - | - | |||||||||||||
February 27, 2013 Convertible Note | |||||||||||||||||
Note due February 27, 2014 | 58,500 | 58,500 | - | - | |||||||||||||
April / May / November, 2013 Convertible Notes | 150,101 | 150,101 | - | - | |||||||||||||
April 18, 2013 Convertible Note | |||||||||||||||||
Note due December 18, 2013 | 31,688 | 31,688 | - | - | |||||||||||||
May 2, 2013 Convertible Notes | 50,000 | 50,000 | - | - | |||||||||||||
May 14, 2013 Convertible Note | |||||||||||||||||
Note due May 14, 2014 | 126,000 | 126,000 | - | - | |||||||||||||
June 27, 2013 Convertible Note | |||||||||||||||||
Note due June 27, 2014 | 37,620 | 20,670 | - | 16,950 | |||||||||||||
June 19, 2013 Convertible Note | |||||||||||||||||
Note due June 19, 2014 | 32,000 | 32,000 | - | - | |||||||||||||
July 12, 2013 Convertible Note | |||||||||||||||||
Note due July 12, 2014 | 125,000 | 125,000 | - | - | |||||||||||||
October, 2013 Convertible Notes | |||||||||||||||||
Notes due in April, 2014 | 55,000 | 55,000 | - | - | |||||||||||||
November, 2013 Convertible Notes | |||||||||||||||||
Notes due in May, 2014 | 80,000 | 80,000 | - | - | |||||||||||||
December, 2013 Convertible Notes I | |||||||||||||||||
Notes due May, 2014 | 250,000 | 250,000 | - | - | |||||||||||||
December, 2013 Convertible Notes II | |||||||||||||||||
Notes due May, 2014 | 536,400 | 536,400 | - | - | |||||||||||||
Total | $ | 3,659,116 | $ | 3,302,166 | $ | - | $ | 356,950 | |||||||||
The following is a summary of debt instrument transactions for the year ended December 31, 2013: | |||||||||||||||||
Face Value | Principal Repayment/ | Unamortized | Balance at | ||||||||||||||
Settlement/Re-issued | Note | December 31, | |||||||||||||||
Discount | 2013 | ||||||||||||||||
February 2011 Secured Convertible Notes | |||||||||||||||||
Senior Secured Notes, due February 24, 2014 | $ | 1,184,694 | $ | 203,836 | $ | 20,083 | $ | 960,775 | |||||||||
April 2011 Secured Convertible Notes | |||||||||||||||||
Senior Secured Notes, due April 4, 2014 | 215,000 | - | 8,835 | 206,165 | |||||||||||||
June 2011 Secured Convertible Note | |||||||||||||||||
Senior Secured Notes, due June 6, 2014 | 30,000 | - | 1,189 | 28,811 | |||||||||||||
August 8, 2012 Convertible Note | |||||||||||||||||
Note due August 8, 2013 | 111,430 | 111,430 | - | - | |||||||||||||
August 12, 2012 Convertible Note | |||||||||||||||||
Note became due November 12, 2012 | 27,500 | - | - | 27,500 | |||||||||||||
August 20, 2012 Convertible Note | |||||||||||||||||
Note due August 20, 2013 | 20,000 | - | - | 20,000 | |||||||||||||
September 18, 2012 Convertible Note | |||||||||||||||||
Note due October 1, 2013 | 82,500 | 82,500 | - | - | |||||||||||||
October 2012 Convertible Note | |||||||||||||||||
Note due October 15, 2013 | 340,000 | - | - | 340,000 | |||||||||||||
October 9, 2012 Convertible Notes | 100,000 | 100,000 | - | - | |||||||||||||
Note due April 30, 2013 | |||||||||||||||||
November 1, 2012 Convertible Note | |||||||||||||||||
Note due April 30, 2013 | 31,471 | 31,471 | - | - | |||||||||||||
November 20, 2012 Convertible Note | |||||||||||||||||
Note due November 20, 2013 | 55,710 | 44,962 | - | 10,748 | |||||||||||||
December 14, 2012 Convertible Note | |||||||||||||||||
Note due April 18, 2013 | 189,210 | 189,210 | - | - | |||||||||||||
December 18, 2012 Convertible Note | |||||||||||||||||
Note due December 14, 2013 | 50,000 | - | - | 50,000 | |||||||||||||
January 5, 2013 Convertible Notes | 567,729 | 115,000 | - | 452,729 | |||||||||||||
January 31, 2013 Convertible Notes | 24,135 | - | - | 24,135 | |||||||||||||
February 27, 2013 Convertible Note | |||||||||||||||||
Note due February 27, 2014 | 58,500 | - | 8,819 | 49,681 | |||||||||||||
April 2, 2013 Convertible Notes | 80,967 | - | - | 80,967 | |||||||||||||
April 18, 2013 Convertible Note | |||||||||||||||||
Note due December 18, 2013 | 60,000 | 28,312 | - | 31,688 | |||||||||||||
May 2, 2013 Convertible Notes | 50,000 | - | - | 50,000 | |||||||||||||
May 5, 2013 Convertible Notes | 45,000 | - | - | 45,000 | |||||||||||||
May 14, 2013 Convertible Note | |||||||||||||||||
Note due May 14, 2014 | 126,000 | - | 46,258 | 79,742 | |||||||||||||
June 27, 2013 Convertible Note | |||||||||||||||||
Note due June 27, 2014 | 37,620 | - | 17,515 | 20,105 | |||||||||||||
June 19, 2013 Convertible Note | |||||||||||||||||
Note due June 19, 2014 | 115,000 | 83,000 | 8,217 | 23,783 | |||||||||||||
July 12, 2013 Convertible Note | |||||||||||||||||
Note due July 12, 2014 | 125,000 | 28,200 | 57,200 | 39,600 | |||||||||||||
October, 2013 Convertible Notes | |||||||||||||||||
Notes due in April, 2014 | 94,444 | - | 56,044 | 38,400 | |||||||||||||
November, 2013 Convertible Notes | |||||||||||||||||
Notes due in May, 2014 | 80,000 | - | 52,996 | 27,004 | |||||||||||||
December, 2013 Convertible Notes I | |||||||||||||||||
Notes due May, 2014 | 277,222 | - | 258,478 | 18,744 | |||||||||||||
December, 2013 Convertible Notes II | |||||||||||||||||
Notes due May, 2014 | 536,400 | - | - | 536,400 | |||||||||||||
Total | $ | 4,715,532 | $ | 1,017,921 | $ | 535,634 | $ | 3,161,977 | |||||||||
February 2011 Secured Convertible Notes | |||||||||||||||||
During the period ended June 30, 2014, the investors converted the principal amount of $980,858 and accrued interest of the February 2011 Notes into 1,593,850 common shares (Note 9). | |||||||||||||||||
April 2011 Secured Convertible Notes | |||||||||||||||||
During the period ended June 30, 2014, the investors converted the principal amount of $215,000 and accrued interest of the April 2011 Notes into 349,375 common shares (Note 9). | |||||||||||||||||
June 2011 Secured Convertible Note | |||||||||||||||||
During the period ended June 30, 2014, the investor converted the principal amount of $30,000 and accrued interest of the June 2011 Note into 48,750 common shares (Note 9). | |||||||||||||||||
August 8, 2012 Convertible Note | |||||||||||||||||
During the year ended December 31, 2013, the investor converted the principal amount of $111,430 and accrued interest of the August 8, 2012 Note into 20,500 common shares. | |||||||||||||||||
August 12, 2012 Convertible Note | |||||||||||||||||
During the period ended June 30, 2014, the investor converted the principal amount of $27,500 and accrued interest of the August 12, 2012 Note into 37,500 common shares (Note 9). | |||||||||||||||||
August 20, 2012 Convertible Note | |||||||||||||||||
During the period ended June 30, 2014, the investor converted the principal amount of $20,000 and accrued interest of the August 20, 2012 Note into 30,000 common shares (Note 9). | |||||||||||||||||
September 18, 2012 Convertible Note | |||||||||||||||||
During the year ended December 31, 2013, the investor converted the principal amount and accrued interest of $81,360 into 29,444 common shares. Of the balance of $24,990 remaining, the Company repaid $20,000 in full settlement and recognized $4,990 as gain on settlement of debt. | |||||||||||||||||
October 2012 Convertible Note | |||||||||||||||||
On October 15, 2012, the Company entered into a securities purchase agreement with an accredited investor to place a Convertible Note (the “October 2012 Note”) with a maturity date of one year after the issuance thereof in the aggregate principal amount of $340,000. The October 2012 Note carries an interest rate of 18% upon default, which is being accrued. | |||||||||||||||||
October 9, 2012 Convertible Note | |||||||||||||||||
On October 9, 2012, the Company converted accounts payable of $100,000 into convertible notes (the “October 9, 2012 Note”). The note has no terms of repayment and no interest charges. Only under certain events of default the note will incur an interest rate of 20% per year. | |||||||||||||||||
During the year ended December 31, 2013, the note was amended and assigned to a third party with price adjustment features ratified by the Company. The third party converted the note into 53,690 common shares of the Company. | |||||||||||||||||
November 20, 2012 Convertible Note | |||||||||||||||||
During the year ended December 31, 2013, the investor converted $30,212 of the November 20, 2012 Note and accrued interest into 36,000 common shares. | |||||||||||||||||
During the period ended June 30, 2014, the investor converted the remaining $10,748 of the November 20, 2012 Note and accrued interest into 20,472 common shares (Note 9). | |||||||||||||||||
December 14, 2012 Convertible Note | |||||||||||||||||
During the year ended December 31, 2013, the investor converted the remaining balance of the note and accrued interest of $189,210 on the December 14, 2012 Note into 31,763 common shares. | |||||||||||||||||
December 18, 2012 Convertible Note | |||||||||||||||||
During the period ended June 30, 2014, the investor converted the December 18, 2012 Note and accrued interest into 68,750 common shares (Note 9). | |||||||||||||||||
January 5, 2013 Convertible Notes | |||||||||||||||||
On January 5, 2013, the Company exchanged amounts due to a consultant and related parties into convertible notes (the “January 5, 2013 Notes”) with no terms of repayment and no interest charges in the aggregate principal amount of $567,729, of which, $330,000 was due to related parties. | |||||||||||||||||
In July, 2013, the consultant assigned $115,000 of the convertible note to a third party with amendments to adjustment of conversion price ratified by the Company. | |||||||||||||||||
During the period ended June 30, 2014, the investors converted the balance of the January 5, 2013 Notes and accrued interest into 543,636 common shares (Note 9). | |||||||||||||||||
January 31, 2013 Convertible Note | |||||||||||||||||
On January 31, 2013, the Company converted accounts payable of $24,134 into a convertible note (the “January 31, 2013 Note”) with a maturity date of sixteen months. The note has no terms of repayment and no interest charges. The conversion of the note occurs under the following conditions: | |||||||||||||||||
On the date that Company files a certificate of designation creating a class of Series A convertible preferred stock (“Series A Convertible Preferred Stock”) (i) with voting rights per share equal to one thousand (1,000) shares of common stock at the rate of five shares of common stock (on a post-reverse stock split basis) for each share of Series A Convertible Preferred Stock and (ii) that are automatically convertible into common shares upon the occurrence of a 100:1 reverse stock split, the Company may convert the January 31, 2013 Note into shares of Series A Convertible Preferred Stock at a conversion price of four dollars ($4) per share of Series A Convertible Preferred Stock. If the Series A Convertible Preferred Stock is duly authorized and outstanding, on the date that the Company enacts a 100:1 reverse stock split, the January 31, 2013 Note will automatically convert into shares of Series A Convertible Preferred Stock at a conversion price of four dollars ($4) per share of Series A Convertible Preferred Stock. | |||||||||||||||||
During the period ended June 30, 2014, the investors converted the January 31, 2013 Note and accrued interest into 40,551 common shares (Note 9). | |||||||||||||||||
February 27, 2013 Convertible Note | |||||||||||||||||
During the period ended June 30, 2014, the investor converted the February 27, 2013 Note and accrued interest into 38,170 common shares (Note 9). | |||||||||||||||||
April / May / November, 2013 Convertible Note | |||||||||||||||||
The Company exchanged accounts payable into convertible notes in the aggregate principal amount of $150.101. The note holder has the option to convert a portion or all of the outstanding balance of the note into shares of the Company’s common stock at a conversion rate of $7.00 per share. The note will incur an interest rate of 8% per year unless the Company defaults under certain conditions, in which case, the note will incur an interest rate of 20% per year. | |||||||||||||||||
During the period ended June 30, 2014, the investor converted the notes and accrued interest into 210,233 common shares (Note 9). | |||||||||||||||||
April 18, 2013 Convertible Note | |||||||||||||||||
On April 18, 2013, the Company entered into a securities purchase agreement with an accredited investor to place a Convertible Note (the “April 18, 2013 Note”) with a maturity date of eight months after the issuance thereof in the aggregate principal amount of $60,000. Consideration under the notes consisted of $50,000 in cash proceeds after $5,000 payment of transaction costs and an original issue discount of $5,000. The April 18, 2013 Note carries an interest rate of 8% per year unless the note is in default under certain conditions, in which case, the interest rate would be 18% per year. | |||||||||||||||||
The Company has allocated the net proceeds to the conversion option based on the calculated fair value. The fair value of the conversion option was recorded at $27,800 and recognized as a derivative liability and the debt was recorded at $27,200. The fair value of the conversion option was calculated using the Binomial option pricing model under the following assumptions: estimated life of eight months, risk free rate of 0.10%, dividend yield of 0% and volatility of 115.82%. The debt discount is being accreted over the eight month term of the April 18, 2013 Note using the effective interest rate method. | |||||||||||||||||
During the year ended December 31, 2013, the investor converted $31,733, part of the principal and accrued interest on the April 18, 2013 Note, into common shares. | |||||||||||||||||
During the period ended June 30, 2014, the investor converted the balance of $31,688 and accrued interest into 46,443 common shares (Note 9). | |||||||||||||||||
May 2, 2013 Convertible Notes | |||||||||||||||||
On May 2, 2013, the Company issued convertible notes (the “May 2, 2013 Note”) in the aggregate principal amount of $50,000. The note matures on May 31, 2014 and would only start to accrue interest of 10% per year after February 15, 2014. The note is automatically convertible into Series B convertible preferred shares (‘Series B Preferred Shares”) when the Company enacts a 100:1 reverse stock split, where each of the Series B Preferred Shares are convertible at the rate of seven shares of common stock. | |||||||||||||||||
During the period ended June 30, 2014, the investor converted the May 2, 2013 Note into 350,000 common shares (Note 9). | |||||||||||||||||
May 14, 2013 Convertible Note | |||||||||||||||||
On May 14, 2013, the Company entered into a securities purchase agreement with an accredited investor to place a Convertible Note (the “May 14, 2013 Note”) with a maturity date of one year after the issuance thereof in the aggregate principal amount of $126,000. The Company also issued 20,000 warrants to the note holder, exercisable at $6.00 per share with a four year term. Consideration under the notes consisted of $110,000 in cash proceeds after $5,000 payment of finders’ fee and an original issue discount of $11,000. | |||||||||||||||||
The May 14, 2013 Note carries an interest rate of 8% per year unless the note is in default, in which case, the note will incur an interest rate of 18% per year. | |||||||||||||||||
The Company has allocated the net proceeds to the conversion option and warrants based on the calculated fair values. The fair value of the conversion option was recorded at $62,678 and fair value of the warrants was recorded as $52,322 recognized as a derivative liabilities and the debt was recorded at $nil. The fair value of the conversion option was calculated using the Black Scholes option pricing model under the following assumptions: estimated life of four years, risk free rate of 0.4%, dividend yield of 0% and volatility of 161%. | |||||||||||||||||
During the period ended June 30, 2014, the investor converted the May 14, 2013 Note and accrued interest into 157,500 common shares (Note 9). | |||||||||||||||||
June 27, 2013 Convertible Note | |||||||||||||||||
On June 27, 2013, the Company entered into a securities purchase agreement with an accredited investor to place a Convertible Note (the “June 27, 2013 Note”) with a maturity date of one year after the issuance thereof in the aggregate principal amount of $37,620. Consideration under the notes consisted of $30,000 in cash proceeds after $3,000 payment of finder’s fee and an original issue discount of $4,620. The Company accrued a one-time interest of 5% as per the agreement. | |||||||||||||||||
The Company has allocated the net proceeds to the conversion option based on the calculated fair value. The fair value of the conversion option was recorded at $30,200 and recognized as a derivative liability and the debt was recorded at $2,800. The fair value of the conversion option was calculated using the Binomial option pricing model under the following assumptions: estimated life of one year, risk free rate of 0.15%, dividend yield of 0% and volatility of 156.41%. | |||||||||||||||||
During the period ended June 30, 2014, the investor converted $20,670 of the June 27, 2013 Note into 22,830 common shares (Note 9). | |||||||||||||||||
June 19, 2013 Convertible Note | |||||||||||||||||
In June, 2013, a consultant assigned $115,000 of its convertible note to a third party with amendments ratified by the Company (the “June 19, 2013 Note”) with a maturity date of one year after the issuance thereof in the aggregate principal amount of $115,000. | |||||||||||||||||
The June 19, 2013 Note carries an interest rate of 10% per year unless the note is in default under certain conditions, in which case, the interest rate would be 20% per year. | |||||||||||||||||
The Company has allocated the net proceeds to the conversion option based on the calculated fair value. The fair value of the conversion option was recorded at $31,600 and recognized as a derivative liability and the debt was recorded at $83,400. The fair value of the conversion option was calculated using the Binomial option pricing model under the following assumptions: estimated life of one year, risk free rate of 0.15%, dividend yield of 0% and volatility of 156.46%. | |||||||||||||||||
During the year ended December 31, 2013, the third party converted the principal amount of $83,000 and accrued interest of the June 19, 2013 Note into 108,188 common shares. | |||||||||||||||||
During the period ended June 30, 2014, the third party converted balance of $32,000 and accrued interest into 40,000 common shares (Note 9). | |||||||||||||||||
July 12, 2013 Convertible Note | |||||||||||||||||
In July, 2013, the Company entered into a securities purchase agreement with an accredited investor to place a Convertible Note (the “July 12, 2013 Note”) with a maturity date of one year after the issuance thereof in the aggregate principal amount of $125,000. The Company also issued 41,667 warrants to the note holder, exercisable at $3.00 per share with a five year term. Consideration under the notes consisted of $110,000 in cash proceeds after $15,000 payment of finders’ fee and an original issue discount of $11,000. | |||||||||||||||||
The July 12, 2013 Note carries an interest rate of 8% per year unless the note is in default, in which case, the note will incur an interest rate of 18% per year. | |||||||||||||||||
The Company has allocated the net proceeds to the conversion option and warrants based on the calculated fair values. The fair value of the conversion option was recorded at $59,615 and fair value of the warrants was recorded as $54.385 recognized as a derivative liabilities and the debt was recorded at $nil. The fair value of the conversion option was calculated using the Binomial option pricing model under the following assumptions: estimated life of five year, risk free rate of 1.4%, dividend yield of 0% and volatility of 199%. | |||||||||||||||||
During the period ended June 30, 2014, the investor converted the July 12, 2013 Note and accrued interest into 156,250 common shares (Note 9). | |||||||||||||||||
October, 2013 Convertible Notes | |||||||||||||||||
In October, 2013, the Company entered into securities purchase agreements with accredited investors to place Convertible Notes (the “October, 2013 Notes”) with a maturity date of six months after the issuance thereof in the aggregate principal amount of $55,000. | |||||||||||||||||
The October, 2013 Notes carry no interest charges unless the note is in default, in which case, the note will incur an interest rate of 20% per year. | |||||||||||||||||
The Company has allocated the net proceeds to the conversion option based on the calculated fair value. The full value was recorded as the fair value of the conversion option and the debt was recorded at $nil. The fair value of the conversion option was calculated using the Binomial option pricing model under the following assumptions: estimated life of six months, risk free rate of 0.10%, dividend yield of 0% and volatility of 199%. | |||||||||||||||||
During the period ended June 30, 2014, the investors converted the October, 2013 Note into 385,000 common shares (Note 9). | |||||||||||||||||
November, 2013 Convertible Notes | |||||||||||||||||
In November, 2013, the Company entered into securities purchase agreements with accredited investors to place Convertible Notes (the “November, 2013 Notes”) with a maturity date of six months after the issuance thereof in the aggregate principal amount of $80,000. Consideration under the notes consisted of $77,000 in cash proceeds and an original issue discount of $3,000. | |||||||||||||||||
The November, 2013 Notes carry no interest charges other than an original issue discount unless the note is in default, in which case, the note will incur an interest rate of 20% per year. | |||||||||||||||||
The Company has allocated the net proceeds to the conversion option based on the calculated fair value. The full value was recorded as the fair value of the conversion option and the debt was recorded at $nil. The fair value of the conversion option was calculated using the Binomial option pricing model under the following assumptions: estimated life of six months, risk free rates of 0.10% and 0.04%, dividend yield of 0% and volatility of 199%. | |||||||||||||||||
During the period ended June 30, 2014, the investors converted the November, 2013 Notes into 560,000 common shares (Note 9). | |||||||||||||||||
December, 2013 Convertible Notes I | |||||||||||||||||
In December, 2013, the Company entered into securities purchase agreements with accredited investors to place Convertible Notes (the “December, 2013 Notes I”) with a maturity date of six months after the issuance thereof in the aggregate principal amount of $250,000. The December, 2013 Notes I carry no interest charges unless the note is in default, in which case, the note will incur an interest rate of 20% per year. | |||||||||||||||||
The Company has allocated the net proceeds to the conversion option based on the calculated fair value. The full value was recorded as the fair value of the conversion option and the debt was recorded at $nil. The fair value of the conversion option was calculated using the Binomial option pricing model under the following assumptions: estimated life of six months, risk free rates of 0.10% , dividend yield of 0% and volatility of 199%. | |||||||||||||||||
During the period ended June 30, 2014, the investors converted the December, 2013 Notes I into 1,750,000 common shares (Note 9). | |||||||||||||||||
December, 2013 Convertible Notes II | |||||||||||||||||
In December, 2013, the Company entered into securities purchase agreements with accredited investors to place Convertible Notes (the “December, 2013 Notes II”) with a maturity date of six months after the issuance thereof in the aggregate principal amount of $536,400. Consideration under the notes consisted of $141,000 of conversion of accounts payable, $267,950 of cash proceeds, of which $100,000 were received during the year ended December 31, 2012 as subscription proceeds and $27,450 of interest costs. The conversion of the notes occurs under the following conditions: | |||||||||||||||||
On the date that Company files a certificate of designation creating a class of Series B Convertible Preferred Stock (i) with voting rights per share equal to one thousand (1,000) shares of common stock and (ii) that are automatically convertible into common shares upon the occurrence of a 100:1 reverse stock split at the rate of seven shares of common stock (on a post-reverse stock split basis) for each share of Series B Convertible Preferred Stock, the Company may convert the December, 2013 Convertible Notes II into shares of Series B Convertible Preferred Stock at a conversion price of one dollar per share of Series B Convertible Preferred Stock. If the Series B Convertible Preferred Stock is duly authorized and outstanding, on the date that the Company enacts a 100:1 reverse stock split, the December, 2013 Convertible Notes II will automatically convert into seven (7) shares of Series B Convertible Preferred Stock at a conversion price of one dollar per share of Series B Convertible Preferred Stock. | |||||||||||||||||
Any amount of the December, 2013 Notes II that are outstanding on February 15, 2014 will carry an interest rate of 10% per year. | |||||||||||||||||
During the period ended June 30, 2014, the investors converted the December, 2013 Notes II into 1,093,900 common shares (Note 9). | |||||||||||||||||
For the period ended June 30, 2014, the Company recorded accretion of debt discount of $492,296 for the convertible notes. | |||||||||||||||||
LOANS_PAYABLE
LOANS PAYABLE | 6 Months Ended |
Jun. 30, 2014 | |
Debt Disclosure [Abstract] | ' |
LOANS PAYABLE | ' |
As at June 30, 2014, there were unsecured loan advances in the amount of $18,000 (December 31, 2013 - $42,200) which are due on demand. Certain of the loans bear interest of 10% per annum. During the period ended June 30, 2014, investors converted $21,500 and a related party converted $2,700 of the loan into common shares of the Company as part of their total debt settlements. | |
PROMISSORY_NOTE
PROMISSORY NOTE | 6 Months Ended |
Jun. 30, 2014 | |
Equity [Abstract] | ' |
PROMISSORY NOTE | ' |
The Company has outstanding promissory notes in the amount of $67,942, of which $38,000 of promissory notes are from an officer and a director of the Company (Note 8). The promissory notes bear no interest charges and have no fixed repayment terms. | |
During the year ended December 31, 2013, the Company converted $210,000 of accounts payable into a promissory note. | |
During the period ended June 30, 2014, the note holder converted outstanding principal and accrued interest into 1,400,000 post reverse stock split common shares. The fair value of the shares was determined to be $3,150,000 and the Company recorded a loss on settlement of debt of $2,912,034. | |
RELATED_PARTY_TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended | ||
Jun. 30, 2014 | |||
Related Party Transactions [Abstract] | ' | ||
RELATED PARTY TRANSACTIONS | ' | ||
During the six months ended June 30, 2014, the Company entered into transactions with certain officers and directors of the Company as follows: | |||
(a) | incurred $117,000 (June 30, 2013 - $178,500) in management fees and $45,000 (June 30, 2013 - $33,000) in research and development services paid or accrued to officers and directors during the period; | ||
(b) | recorded $7,500 (June 30, 2013 - $14,925) in stock based compensation for the fair value of options granted to management and consultants that were granted and or vested during the period; | ||
(c) | converted $721,045 (June 30, 2013 - $nil) of debt due to related parties during the period, which were settled with shares (Note 9). | ||
(d) | converted $nil (June 30, 2013 - $567,729) of payable into convertible notes to officers, consultant and a director of the Company (Note 5). | ||
All related party transactions (other than stock based compensation) involving provision of services were recorded at the exchange amount, which is the amount established and agreed to by the related parties as representing fair value. The Company accounted for the debt settlement transactions with related parties at management’s estimate of fair value, using amounts similar to arm’s length settlements for debt settled. | |||
At June 30, 2014, the Company had amounts owing to directors and officers of $152,000 (December 31, 2013 - $369,345) in fees and $nil (December 31, 2013 - $370,200) in loans and other advances. All amounts due to related parties are unsecured, non-interest bearing and have no specific terms of repayment. | |||
CAPITAL_STOCK
CAPITAL STOCK | 6 Months Ended | ||||||||||||
Jun. 30, 2014 | |||||||||||||
Equity [Abstract] | ' | ||||||||||||
CAPITAL STOCK | ' | ||||||||||||
Share Capital | |||||||||||||
Prior to March 27, 2007, the authorized capital of the Company consisted of 50,000,000 common shares with $0.001 par value and 5,000,000 non-voting preferred shares with $0.001 par value. On March 27, 2007, the Company’s Articles of Incorporation were amended to increase the authorized shares of common stock from 50,000,000 shares of common stock to 200,000,000 shares. On June 28, 2007, the Company completed a reverse stock split thereby issuing 1 new share for each 2.5 outstanding shares of the Company’s common stock. Accordingly, the Company’s authorized share capital was decreased from 200,000,000 common shares to 80,000,000 common shares. On January 22, 2009 the authorized shares of common stock increased from 80,000,000 shares to 500,000,000 shares. Effective July 10, 2009, the Company executed a further 1 for 10 reverse stock split while simultaneously reducing the authorized shares of common stock to 50,000,000 common shares with a $0.001 par value. Effective February 21, 2010, the Company increased its authorized shares of common stock from 50,000,000 shares to 150,000,000 common shares. The Company maintained its authorized shares of preferred stock at 5,000,000. | |||||||||||||
On January 6, 2014, the Company designated 1,200,000 series A preferred shares (“Series A Convertible Preferred Stock”). Each share of Series A Convertible Preferred Stock that is outstanding at the time that the Company enacts a 100 to 1 reverse stock split, the Series A Convertible Preferred Stock shall automatically convert into five (5) shares of the Company’s common stock on a post-split basis. | |||||||||||||
On January 10, 2014, the Company completed a reverse stock split thereby issuing 1 new share for each 100 outstanding shares of the Company’s common stock and amending the Company’s Articles of Incorporation to increase the authorized shares of common stock from 150,000,000 shares of common stock to 500,000,000 shares. | |||||||||||||
On February 18, 2014, the Company’s board of directors approved the creation of a class of up to 1,500,000 preferred stock, par value $0.001, called series B convertible preferred stock (“Series B Convertible Preferred Stock”). The terms of the Series B Convertible Preferred Stock are: | |||||||||||||
· | rank pari passu to the common stock with respect to rights on liquidation, winding up and dissolution; | ||||||||||||
· | have no dividend rights except as may be declared by the Board in its sole and absolute discretion; | ||||||||||||
· | shall have the right to cast one thousand (1,000) votes for each share held of record on all matters submitted to a vote of holders of the Corporation’s common stock; and | ||||||||||||
· | shall automatically convert into shares of common stock upon the occurrence of a reverse stock split of the Corporation’s common stock in which every 100 shares of the Corporation’s common stock outstanding at the time that this certificate of designation was filed with the Secretary of State of Nevada is exchanged for one share of the Corporation’s common stock, with each share of Series B Convertible Preferred Stock converting into seven (7) shares of the Corporation’s common stock (such number to be after the 100:1 reverse stock split). | ||||||||||||
All prior period share transactions included in the Company’s stock transactions and balances have been retroactively restated for the reverse stock split described above. | |||||||||||||
2014 Share Transactions | |||||||||||||
During the period ended June 30, 2014, the Company received subscription proceeds of $418,000 for 418,000 shares of Series B Convertible Preferred Stock. In February 2014, the 418,000 shares of Series B Convertible Preferred Stock were converted into 2,926,000 shares of common stock as per the terms described above. | |||||||||||||
During the period ended June 30, 2014, the Company issued 11,088,081 shares of its common stock with a fair value of $24,952,358 for conversion of convertible debt, accounts payable, loan, promissory note, and accrued interest in the amount of $4,960,982. In these conversions, related parties converted $721,045 of notes, accounts payable and loan into 766,444 shares of the Company’s common stock. | |||||||||||||
During the period ended June 30, 2014, the Company issued 58,787 shares of its common stock with a fair value of $151,821 for legal services. | |||||||||||||
During the period ended June 30, 2014, the Company issued 150,000 shares of its common stock pursuant to an advisory agreement with a fair value of $337,500. | |||||||||||||
During the period ended June 30, 2014, the Company issued 145,000 shares of its common stock pursuant to agreements with a fair value of $761,250 for settlement of accrued liability of $355,950. | |||||||||||||
During the period ended June 30, 2014, the Company agreed to issue 12,500 shares of its common stock pursuant to an agreement with a fair value of $58,750. The shares have not yet been issued. | |||||||||||||
During the period ended June 30, 2014, the Company issued 845,075 shares of its common stock pursuant to settlement agreements with a creditor with a fair value of $2,981,231. | |||||||||||||
During the period ended June 30, 2014, the Company issued 81,472 shares of its common stock with a fair value of $211,658 for conversion of convertible debt and accrued interest in the amount of $86,243. | |||||||||||||
During the period ended June 30, 2014, the Company issued 46,443 shares of its common stock with a fair value of $204,349 for conversion of convertible debt and accrued interest in the amount of $32,510. | |||||||||||||
During the period ended June 30, 2014, the Company received subscription proceeds of $165,000 for 165,000 units. Each unit consists of one common share and one share purchase warrant exercisable at $2.50 for a period of 3 years. | |||||||||||||
The Company records shares issued for non-cash consideration or on conversion of debt at the fair value. As a result of the above settlements and conversions, the Company recorded a loss on settlement of debt of $26,743,197. | |||||||||||||
2013 Share Transactions | |||||||||||||
In January 2013, the Company issued 2,313 shares of its common stock for conversion of one of the two November 1, 2012 Notes (Note 5) at a conversion price of $6.62 per share. In February 2013, the Company issued 2,500 common shares with a fair value of $28,925 to a consultant pursuant to a consulting agreement. In February 2013, the Company issued 18,986 common shares on a cashless conversion of 30,000 warrants at an exercise price of $5.72. In March 2013, the Company issued 100,000 common shares with a fair value of $10,010 to a consultant pursuant to a consulting agreement. | |||||||||||||
Between January and March, 2013, the Company issued 31,763 shares of its common stock for conversion of December 14, 2012 Note (Note 5) at a conversion price of $6.03 per share. | |||||||||||||
Between January and May, 2013, the Company issued 19,444 shares of its common stock for partial conversion of September 18, 2012 Note (Note 5) at an average conversion price of $3.60 per share. | |||||||||||||
Between February and March, 2013, the Company issued 10,500 shares of its common stock for partial conversion of August 8, 2012 Note (Note 5) at an average conversion price of $6.81 per share. | |||||||||||||
In April 2013, the Company issued 2,815 shares of its common stock for conversion of the balance of the November 1, 2012 Notes (Note 5) at a conversion price of $6.07 per share. | |||||||||||||
Between April and September, 2013, the Company issued 264,649 shares of its common stock for partial settlement of debt in the amount of $510,572. A further 455,311 shares remain to be issued with respect to this debt. The shares had a fair value of approximately $910,000 at December 31, 2013. | |||||||||||||
In April, 2013, the Company issued 2,500 shares of its restricted common stock under a settlement agreement with a former director of the Company. | |||||||||||||
Between May and July, 2013, the Company issued 53,690 shares of its common stock with a fair value of $248,278 for conversion of October 9, 2012 Convertible Notes (Note 5). | |||||||||||||
Between May and June, 2013, the Company issued 30,000 shares of its common stock with a fair value of $137,200 for conversion of the balances of the August 8, 2012 Note and November 20, 2013 Note (Note 5). | |||||||||||||
Between July and September 30, 2013, the Company issued 108,188 shares of its common stock with a fair value of $181,606 for conversion of June 19, 2013 Convertible Note (Note 5). | |||||||||||||
In August, 2013, the Company issued 50,000 shares of its common stock with a fair value of $52,500 for conversion of July 12, 2013 Convertible Note (Note 5). | |||||||||||||
In August and September 2013, the Company issued 36,000 shares and is obligated to issue additional 20,472 shares of its common stock with a fair value of $52,960 for conversion of November 20, 2012 Convertible Note (Note 5). | |||||||||||||
In September, 2013, the Company issued 10,000 shares of its common stock with a fair value of $10,500 for partial conversion of September 18, 2012 Note (Note 5). | |||||||||||||
In November, 2013, the Company issued 12,000 shares of its common stock with a fair value of $13,340 for partial conversion of September 18, 2012 Note (Note 5). | |||||||||||||
In November, 2013, the Company issued 45,333 shares of its common stock with a fair value of $134,187 for partial conversion of April 18, 2013 Note (Note 5). | |||||||||||||
In March, 2013, the Company received $242,950 for a private placement, for which it issued 34,707 shares and equal number of warrants. In December 2013, the Company entered into rescission agreements whereby the Company replaced the shares and warrants with December, 2013 Convertible Notes II and the 34,707 shares and warrants were returned to the treasury (Note 5). | |||||||||||||
As a result of the above settlements and conversions, the Company recorded a loss on settlement of debt of $2,560,045. | |||||||||||||
Stock Compensation Plan | |||||||||||||
On October 14, 2009, the Company adopted the 2009 Stock Incentive Plan (the “2009 Plan”) which supersedes and replaces the 2007 Stock Plan. The 2009 Plan allows for the issuance of up to 100,000 common shares. Options granted under the Plan shall be at prices and for terms as determined by the Board of Directors. | |||||||||||||
The expensed portion of the value of the vesting options during the Six Months Ended June 30, 2014 was $3,750 (June 30, 2013 - $29,894) which was recorded as stock based consulting and management fees. During the period, stock-based consulting and management fees also includes share based compensation. | |||||||||||||
Share purchase options | |||||||||||||
A summary of the Company’s stock options as of June 30, 2014 and changes during the period is presented below: | |||||||||||||
Number of | Weighted Average | Weighted Average | |||||||||||
Options | Exercise Price | Remaining Life | |||||||||||
Balance, December 31, 2012 | 65,430 | $ | 18 | 6.05 | |||||||||
Issued | - | - | - | ||||||||||
Cancelled/Forfeited | - | - | - | ||||||||||
Balance, December 31, 2013 | 65,430 | 18 | 6.05 | ||||||||||
Issued | - | - | - | ||||||||||
Cancelled/Forfeited | - | - | - | ||||||||||
Balance, June 30, 2014 | 65,430 | $ | 18 | 4.55 | |||||||||
At June 30, 2014, the intrinsic value of the vested options was equal to $nil (2013 - $nil). | |||||||||||||
A summary of the status of the Company’s unvested options as of June 30, 2014 is presented below: | |||||||||||||
Number of | Weighted Average | ||||||||||||
Shares | Grant-Date | ||||||||||||
Fair Value | |||||||||||||
Unvested, December 31, 2013 | 1,111 | $ | 18 | ||||||||||
Granted | - | - | |||||||||||
Vested | (417 | ) | 18 | ||||||||||
Cancelled | - | - | |||||||||||
Unvested, June 30, 2014 | 694 | $ | 18 | ||||||||||
Share Purchase Warrants | |||||||||||||
In March, 2014, the Company issued 100,000 share purchase warrants to acquire an equivalent number of common shares of the Company, at an exercise price of $4.00 per share for an exercise period of up to five years from the issuance date. The warrants were issued pursuant to a technology option agreement. The fair value of these warrants was determined to be $303,000. | |||||||||||||
In May, 2013, the Company issued 20,000 share purchase warrants to acquire an equivalent number of common shares of the Company, at an exercise price of $6.00 per share for an exercise period of up to four years from the issuance date. The warrants were issued pursuant to a convertible debt with price adjustment features. The residual fair value of these warrants was determined to be $52,322 and recognized as a derivative liability. | |||||||||||||
In July, 2013, the Company issued 41,667 share purchase warrants to acquire an equivalent number of common shares of the Company, at an exercise price of $4.00 per share for an exercise period of up to five years from the issuance date. The warrants were issued pursuant to a convertible debt with price adjustment features. The residual fair value of these warrants was determined to be $54,385 and recognized as a derivative liability. | |||||||||||||
A summary of the Company’s share purchase warrants as of June 30, 2014 and changes during the period is presented below: | |||||||||||||
Number of | Weighted Average | Weighted Average | |||||||||||
Warrants | Exercise Price | Remaining Life | |||||||||||
Balance, December 31, 2012 | 169,087 | $ | 39 | 2.19 | |||||||||
Issued | 67,667 | 5.84 | 4.16 | ||||||||||
Exercised | (30,000 | ) | 25 | - | |||||||||
Extinguished or expired | (57,302 | ) | 39.72 | - | |||||||||
Balance, December 31, 2013 | 149,452 | 25.85 | 2.76 | ||||||||||
Issued | 100,000 | 4 | 4.72 | ||||||||||
Exercised | - | - | - | ||||||||||
Extinguished or expired | (15,167 | ) | - | - | |||||||||
Balance, June 30, 2014 | 234,285 | $ | 15.61 | 2.98 | |||||||||
SUPPLEMENTAL_CASH_FLOW_INFORMA
SUPPLEMENTAL CASH FLOW INFORMATION AND NON-CASH INVESTING AND FINANCING ACTIVITIES | 6 Months Ended | |||||||||
Jun. 30, 2014 | ||||||||||
Supplemental Cash Flow Elements [Abstract] | ' | |||||||||
SUPPLEMENTAL CASH FLOW INFORMATION AND NON-CASH INVESTING AND FINANCING ACTIVITIES | ' | |||||||||
Six Months Ended | ||||||||||
30-Jun-14 | ||||||||||
Number of Shares | Amount | |||||||||
$ | ||||||||||
Shares issued for services | 203,787 | 507,771 | ||||||||
Shares issued pursuant to an advisory agreement | 150,000 | 337,500 | ||||||||
Shares issued pursuant to debt settlement | 14,985,354 | 34,389,349 | ||||||||
Six Months Ended | ||||||||||
30-Jun-13 | ||||||||||
Number of Shares | Amount | |||||||||
$ | ||||||||||
Shares issued pursuant to consulting arrangements | 350,000 | 38,935 | ||||||||
Shares issued pursuant to debt settlement | 18,464,921 | 510,572 | ||||||||
Shares issued pursuant to notes conversion | 14,733,733 | 561,687 | ||||||||
All the above share transactions have been retroactively restated for the reverse stock split described in Note 9. | ||||||||||
See Notes 5 and 9 for additional disclosure on non-cash transactions. | ||||||||||
Period Ended June 30, | ||||||||||
2014 | 2013 | |||||||||
Interest paid in cash | $ | - | $ | - | ||||||
Income taxes paid | $ | - | $ | - | ||||||
CONTINGENCIES_AND_COMMITMENTS
CONTINGENCIES AND COMMITMENTS | 6 Months Ended |
Jun. 30, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | ' |
CONTINGENCIES AND COMMITMENTS | ' |
Contingencies: | |
Consultant Litigation | |
In May 2012, the Company issued 112,000 post-reverse split shares of common stock to two consultants. The Company contested the validity of the services provided and initially was able to delay the sale of the contested shares. The Company was not successful in recovering the contested shares. A claim for alleged damages of approximately $362,000 plus costs by one of the consultants as a result of the contesting of the issuance of the shares has been filed in the Supreme Court of New York. The claim is for damages on the difference between market price at the time the Company was able to delay the sale of his shares and the market price at the time of the sale of all of his shares. As the result of a judicial decision in New York the consultant received a bond payment of approximately $100,000 that the Company had used to secure a temporary restraining order against the issuance of stock to him. The Company is pursuing this litigation through the American Arbitration Association and the potential loss from this litigation, if any, is presently not yet determinable. | |
Tax Filings | |
The Company has not filed income tax returns for several years in certain operating jurisdictions, and may be subject to possible compliance penalties and interest. Management is currently not able to make a reliably measurable provision for possible liability for penalties and interest, if any, at this time, and the Company may be liable for such amounts upon assessment. Penalties and interest, if assessed in the future, will be recorded in the period such amounts are determinable. | |
Commitments: | |
Combined Research and Operating Obligations | |
Effective May 25, 2010, the Company entered into a research and license Option Agreement with the Mayo Clinic for the development and possible commercial use of a cancer vaccine. Subject to the approval and guidance of the United States Food and Drug Administration (“FDA”) the Mayo Clinic plans to conduct a Phase I human clinical trial (“Phase I Trial”) to test and develop the Company’s technology. | |
The Company agreed that, during the period of the option and upon approval of FDA to conduct Phase I Trials, it will pay all the costs incurred by the Mayo Clinic, not to exceed a total of $841,000, of which $510,000 has been paid by a third party under the subsequent Sponsored Research Agreement and $330,000 has been accrued in prior years. Management anticipates that Phase 1 Trials will complete by the end of 2014. | |
Management Services Agreement | |
In February 2011, the Company approved an employment agreement with Dr. Wilson with an initial term of 2 years, which may be automatically extended for successive one-year terms. This employment agreement provides for annual compensation of $180,000 and the grant of an option to acquire 20,000 shares of the Company’s common stock at $19.00 per share, 50% of which vested on March 16, 2011, and the remainder vested monthly over a period of two years (417 per month). The options shall be exercisable for at least five years. | |
Consultant Agreements | |
In May 2012, the Company entered into a one year consulting services agreement superseding the previous management consulting agreement with a consultant (“Consultant A”) to provide expertise in the areas of finance and corporate development to the Management and Board of TapImmune. The consulting services agreement provides for a consulting fee of $12,000 per month from May 2012 to December 2012 and $10,000 for the following four months. The Company also granted 2,500 options to the consultant, vesting equally over twelve months at an exercise price of $17.00 with a ten year term. | |
In November 2013, the Company entered into an advisory agreement with Consultant A to provide expertise in the areas of finance, corporate restructuring and corporate development to the Management and Board of TapImmune for a one year term. The advisory agreement provides for an advisory fee of $10,000 per month from November 2013 to May 2014 for six months, extendable for additional six months subject to mutual agreement. The Company will also grant 250,000 shares to the consultant post restructuring of the Company’s debt, of which the Company issued 150,000 common shares during the period ended June 30, 2014 (Note 9). | |
In February, 2014, the Company entered into a one year media and investor relations service contract with a consultant. The contract provides for the Company to make a $100,000 payment on signing of the contract (paid) and 200,000 shares of restricted common stock, of which 100,000 were issued immediately and an additional 100,000 restricted common stock within 10 business days upon the Company’s successful listing on NASDAQ or NYSE MKT exchange. | |
ACCOUNTS_PAYABLE_AND_ACCRUED_L
ACCOUNTS PAYABLE AND ACCRUED LIABILITIES | 6 Months Ended | ||||||||
Jun. 30, 2014 | |||||||||
Payables and Accruals [Abstract] | ' | ||||||||
ACCOUNTS PAYABLE AND ACCRUED LIABILITIES | ' | ||||||||
Accounts Payable and Accrued Liabilities | |||||||||
30-Jun-14 | 31-Dec-13 | ||||||||
$ | $ | ||||||||
Trade accounts payable | 940,459 | 1,450,083 | |||||||
Debt settlement accruals | - | 1,348,663 | |||||||
Accrued liabilities | 135,994 | 201,334 | |||||||
Employee payroll and severance | 27,541 | 220,290 | |||||||
Accrued interest | 108,547 | 558,032 | |||||||
1,212,541 | 3,778,401 | ||||||||
SUBSEQUENT_EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2014 | |
Subsequent Events [Abstract] | ' |
SUBSEQUENT EVENTS | ' |
In July 2014, certain debt holder converted $16,950 of debt into 19,371 shares of common stock of the Company. | |
In August 2014, the Company issued 26,250 shares of common stock in exchange for $26,250 of services. | |
In August 2014, the Company issued 120,000 shares of common stock and warrants to purchase 120,000 shares of common stock to its President and CEO in exchange for the conversion due but unpaid compensation of $120,000. | |
In August 2014, the Company received subscription proceeds of $100,000 for 100,000 units. Each unit consists of one common share and one share purchase warrant exercisable at $2.50 for a period of 3 years. The Company issued an aggregate of 265,000 shares of common stock and warrants, of which, 165,000 shares and warrants were issued for the subscription proceeds received during the period ended June 2014 (Note 9). | |
In August 2014, the Company entered into a securities purchase agreement with certain accredited investors pursuant to which the Company issued an aggregate of 1,886,792 units, with each unit consisting of a share of the Company’s common stock and a warrant to purchase a share of the Company’s common stock at a purchase price of $1.06 per unit, for aggregate gross proceeds of $2 million. The warrants have an exercise price of $1.17 per share and have a term of exercise equal to five years from the date of issuance of the warrants. The Company intends to use the net proceeds from the offering for general corporate purposes, including clinical trial expenses and research and development expenses. | |
The Company agreed to pay cash fee for placement agent and financial advisory services equal to 7% of the gross proceeds of the offering and to issue warrants to purchase 5% of the aggregate number of shares of common stock sold in the offering to the placement agent. The placement agent warrants have an exercise price of $1.325 per share and shall expire on July 29, 2019. | |
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2014 | |
Accounting Policies [Abstract] | ' |
Basis of Presentation | ' |
In the opinion of management, the accompanying balance sheets and related interim statements of operations and cash flows include all adjustments, consisting only of normal recurring items, necessary for their fair presentation in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Preparing financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, and expenses. Significant areas requiring management’s estimates and assumptions include deferred taxes and related tax balances and disclosures, determining the fair value of stock-based compensation and stock based transactions, the fair value of the components of the convertible notes payable, foreign exchange gains and losses, allocation of costs to research and development and accrued liabilities. Matters impacting the company’s ability to continue as a going concern and contingencies also involve the use of estimates and assumptions. | |
Interim results are not necessarily indicative of results for a full year. The information included in this quarterly report on Form 10-Q should be read in conjunction with information included in the Company’s annual report on Form 10-K/A filed on April 17, 2014, with the U.S. Securities and Exchange Commission. |
CONVERTIBLE_NOTES_PAYABLE_Tabl
CONVERTIBLE NOTES PAYABLE (Tables) | 6 Months Ended | ||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||
Debt Disclosure [Abstract] | ' | ||||||||||||||||
Debt instrument transactions | ' | ||||||||||||||||
Face Value | Principal Repayment/ | Unamortized | Balance at | ||||||||||||||
Settlement/Re-issued | Note | June 30, | |||||||||||||||
Discount | 2014 | ||||||||||||||||
February 2011 Secured Convertible Notes | |||||||||||||||||
Senior Secured Notes, due February 24, 2014 | $ | 980,830 | $ | 980,830 | $ | - | $ | - | |||||||||
April 2011 Secured Convertible Notes | |||||||||||||||||
Senior Secured Notes, due April 4, 2014 | 215,000 | 215,000 | - | - | |||||||||||||
June 2011 Secured Convertible Note | |||||||||||||||||
Senior Secured Notes, due June 6, 2014 | 30,000 | 30,000 | - | - | |||||||||||||
August 12, 2012 Convertible Note | |||||||||||||||||
Note became due November 12, 2012 | 27,500 | 27,500 | - | - | |||||||||||||
August 20, 2012 Convertible Note | |||||||||||||||||
Note due August 20, 2013 | 20,000 | 20,000 | - | - | |||||||||||||
October 2012 Convertible Note | |||||||||||||||||
Note due October 15, 2013 | 340,000 | - | - | 340,000 | |||||||||||||
November 20, 2012 Convertible Note | |||||||||||||||||
Note due November 20, 2013 | 10,748 | 10,748 | - | - | |||||||||||||
December 18, 2012 Convertible Note | |||||||||||||||||
Note due December 14, 2013 | 50,000 | 50,000 | - | - | |||||||||||||
January 5, 2013 Convertible Notes | 452,729 | 452,729 | - | - | |||||||||||||
February 27, 2013 Convertible Note | |||||||||||||||||
Note due February 27, 2014 | 58,500 | 58,500 | - | - | |||||||||||||
April / May / November, 2013 Convertible Notes | 150,101 | 150,101 | - | - | |||||||||||||
April 18, 2013 Convertible Note | |||||||||||||||||
Note due December 18, 2013 | 31,688 | 31,688 | - | - | |||||||||||||
May 2, 2013 Convertible Notes | 50,000 | 50,000 | - | - | |||||||||||||
May 14, 2013 Convertible Note | |||||||||||||||||
Note due May 14, 2014 | 126,000 | 126,000 | - | - | |||||||||||||
June 27, 2013 Convertible Note | |||||||||||||||||
Note due June 27, 2014 | 37,620 | 20,670 | - | 16,950 | |||||||||||||
June 19, 2013 Convertible Note | |||||||||||||||||
Note due June 19, 2014 | 32,000 | 32,000 | - | - | |||||||||||||
July 12, 2013 Convertible Note | |||||||||||||||||
Note due July 12, 2014 | 125,000 | 125,000 | - | - | |||||||||||||
October, 2013 Convertible Notes | |||||||||||||||||
Notes due in April, 2014 | 55,000 | 55,000 | - | - | |||||||||||||
November, 2013 Convertible Notes | |||||||||||||||||
Notes due in May, 2014 | 80,000 | 80,000 | - | - | |||||||||||||
December, 2013 Convertible Notes I | |||||||||||||||||
Notes due May, 2014 | 250,000 | 250,000 | - | - | |||||||||||||
December, 2013 Convertible Notes II | |||||||||||||||||
Notes due May, 2014 | 536,400 | 536,400 | - | - | |||||||||||||
Total | $ | 3,659,116 | $ | 3,302,166 | $ | - | $ | 356,950 | |||||||||
CONVERTIBLE_NOTES_PAYABLE_Tabl1
CONVERTIBLE NOTES PAYABLE (Tables 1) | 6 Months Ended | ||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||
Debt Disclosure [Abstract] | ' | ||||||||||||||||
Debt instrument transactions | ' | ||||||||||||||||
Face Value | Principal Repayment/ | Unamortized | Balance at | ||||||||||||||
Settlement/Re-issued | Note | December 31, | |||||||||||||||
Discount | 2013 | ||||||||||||||||
February 2011 Secured Convertible Notes | |||||||||||||||||
Senior Secured Notes, due February 24, 2014 | $ | 1,184,694 | $ | 203,836 | $ | 20,083 | $ | 960,775 | |||||||||
April 2011 Secured Convertible Notes | |||||||||||||||||
Senior Secured Notes, due April 4, 2014 | 215,000 | - | 8,835 | 206,165 | |||||||||||||
June 2011 Secured Convertible Note | |||||||||||||||||
Senior Secured Notes, due June 6, 2014 | 30,000 | - | 1,189 | 28,811 | |||||||||||||
August 8, 2012 Convertible Note | |||||||||||||||||
Note due August 8, 2013 | 111,430 | 111,430 | - | - | |||||||||||||
August 12, 2012 Convertible Note | |||||||||||||||||
Note became due November 12, 2012 | 27,500 | - | - | 27,500 | |||||||||||||
August 20, 2012 Convertible Note | |||||||||||||||||
Note due August 20, 2013 | 20,000 | - | - | 20,000 | |||||||||||||
September 18, 2012 Convertible Note | |||||||||||||||||
Note due October 1, 2013 | 82,500 | 82,500 | - | - | |||||||||||||
October 2012 Convertible Note | |||||||||||||||||
Note due October 15, 2013 | 340,000 | - | - | 340,000 | |||||||||||||
October 9, 2012 Convertible Notes | 100,000 | 100,000 | - | - | |||||||||||||
Note due April 30, 2013 | |||||||||||||||||
November 1, 2012 Convertible Note | |||||||||||||||||
Note due April 30, 2013 | 31,471 | 31,471 | - | - | |||||||||||||
November 20, 2012 Convertible Note | |||||||||||||||||
Note due November 20, 2013 | 55,710 | 44,962 | - | 10,748 | |||||||||||||
December 14, 2012 Convertible Note | |||||||||||||||||
Note due April 18, 2013 | 189,210 | 189,210 | - | - | |||||||||||||
December 18, 2012 Convertible Note | |||||||||||||||||
Note due December 14, 2013 | 50,000 | - | - | 50,000 | |||||||||||||
January 5, 2013 Convertible Notes | 567,729 | 115,000 | - | 452,729 | |||||||||||||
January 31, 2013 Convertible Notes | 24,135 | - | - | 24,135 | |||||||||||||
February 27, 2013 Convertible Note | |||||||||||||||||
Note due February 27, 2014 | 58,500 | - | 8,819 | 49,681 | |||||||||||||
April 2, 2013 Convertible Notes | 80,967 | - | - | 80,967 | |||||||||||||
April 18, 2013 Convertible Note | |||||||||||||||||
Note due December 18, 2013 | 60,000 | 28,312 | - | 31,688 | |||||||||||||
May 2, 2013 Convertible Notes | 50,000 | - | - | 50,000 | |||||||||||||
May 5, 2013 Convertible Notes | 45,000 | - | - | 45,000 | |||||||||||||
May 14, 2013 Convertible Note | |||||||||||||||||
Note due May 14, 2014 | 126,000 | - | 46,258 | 79,742 | |||||||||||||
June 27, 2013 Convertible Note | |||||||||||||||||
Note due June 27, 2014 | 37,620 | - | 17,515 | 20,105 | |||||||||||||
June 19, 2013 Convertible Note | |||||||||||||||||
Note due June 19, 2014 | 115,000 | 83,000 | 8,217 | 23,783 | |||||||||||||
July 12, 2013 Convertible Note | |||||||||||||||||
Note due July 12, 2014 | 125,000 | 28,200 | 57,200 | 39,600 | |||||||||||||
October, 2013 Convertible Notes | |||||||||||||||||
Notes due in April, 2014 | 94,444 | - | 56,044 | 38,400 | |||||||||||||
November, 2013 Convertible Notes | |||||||||||||||||
Notes due in May, 2014 | 80,000 | - | 52,996 | 27,004 | |||||||||||||
December, 2013 Convertible Notes I | |||||||||||||||||
Notes due May, 2014 | 277,222 | - | 258,478 | 18,744 | |||||||||||||
December, 2013 Convertible Notes II | |||||||||||||||||
Notes due May, 2014 | 536,400 | - | - | 536,400 | |||||||||||||
Total | $ | 4,715,532 | $ | 1,017,921 | $ | 535,634 | $ | 3,161,977 | |||||||||
CAPITAL_STOCK_Tables
CAPITAL STOCK (Tables) | 6 Months Ended | ||||||||||||
Jun. 30, 2014 | |||||||||||||
Equity [Abstract] | ' | ||||||||||||
Share purchase options | ' | ||||||||||||
Number of | Weighted Average | Weighted Average | |||||||||||
Options | Exercise Price | Remaining Life | |||||||||||
Balance, December 31, 2012 | 65,430 | $ | 18 | 6.05 | |||||||||
Issued | - | - | - | ||||||||||
Cancelled/Forfeited | - | - | - | ||||||||||
Balance, December 31, 2013 | 65,430 | 18 | 6.05 | ||||||||||
Issued | - | - | - | ||||||||||
Cancelled/Forfeited | - | - | - | ||||||||||
Balance, June 30, 2014 | 65,430 | $ | 18 | 4.55 | |||||||||
CAPITAL_STOCK_Tables_1
CAPITAL STOCK (Tables 1) | 6 Months Ended | ||||||||
Jun. 30, 2014 | |||||||||
Equity [Abstract] | ' | ||||||||
Share purchase options1 | ' | ||||||||
Number of | Weighted Average | ||||||||
Shares | Grant-Date | ||||||||
Fair Value | |||||||||
Unvested, December 31, 2013 | 1,111 | $ | 18 | ||||||
Granted | - | - | |||||||
Vested | (417 | ) | 18 | ||||||
Cancelled | - | - | |||||||
Unvested, June 30, 2014 | 694 | $ | 18 | ||||||
CAPITAL_STOCK_Tables_2
CAPITAL STOCK (Tables 2) | 6 Months Ended | ||||||||||||
Jun. 30, 2014 | |||||||||||||
Equity [Abstract] | ' | ||||||||||||
Share Purchase Warrants | ' | ||||||||||||
Number of | Weighted Average | Weighted Average | |||||||||||
Warrants | Exercise Price | Remaining Life | |||||||||||
Balance, December 31, 2012 | 169,087 | $ | 39 | 2.19 | |||||||||
Issued | 67,667 | 5.84 | 4.16 | ||||||||||
Exercised | (30,000 | ) | 25 | - | |||||||||
Extinguished or expired | (57,302 | ) | 39.72 | - | |||||||||
Balance, December 31, 2013 | 149,452 | 25.85 | 2.76 | ||||||||||
Issued | 100,000 | 4 | 4.72 | ||||||||||
Exercised | - | - | - | ||||||||||
Extinguished or expired | (15,167 | ) | - | - | |||||||||
Balance, June 30, 2014 | 234,285 | $ | 15.61 | 2.98 | |||||||||
ACCOUNTS_PAYABLE_AND_ACCRUED_L1
ACCOUNTS PAYABLE AND ACCRUED LIABILITIES (Tables) | 6 Months Ended | ||||||||
Jun. 30, 2014 | |||||||||
Payables and Accruals [Abstract] | ' | ||||||||
Accounts Payable and Accrued Liabilities | ' | ||||||||
30-Jun-14 | 31-Dec-13 | ||||||||
$ | $ | ||||||||
Trade accounts payable | 940,459 | 1,450,083 | |||||||
Debt settlement accruals | - | 1,348,663 | |||||||
Accrued liabilities | 135,994 | 201,334 | |||||||
Employee payroll and severance | 27,541 | 220,290 | |||||||
Accrued interest | 108,547 | 558,032 | |||||||
1,212,541 | 3,778,401 | ||||||||
SUPPLEMENTAL_CASH_FLOW_INFORMA1
SUPPLEMENTAL CASH FLOW INFORMATION AND NON-CASH INVESTING AND FINANCING ACTIVITIES (Tables) | 6 Months Ended | |||||||||
Jun. 30, 2014 | ||||||||||
Supplemental Cash Flow Elements [Abstract] | ' | |||||||||
Schedule of cash flow supplemental | ' | |||||||||
Six Months Ended | ||||||||||
30-Jun-14 | ||||||||||
Number of Shares | Amount | |||||||||
$ | ||||||||||
Shares issued for services | 203,787 | 507,771 | ||||||||
Shares issued pursuant to an advisory agreement | 150,000 | 337,500 | ||||||||
Shares issued pursuant to debt settlement | 14,985,354 | 34,389,349 | ||||||||
Six Months Ended | ||||||||||
30-Jun-13 | ||||||||||
Number of Shares | Amount | |||||||||
$ | ||||||||||
Shares issued pursuant to consulting arrangements | 350,000 | 38,935 | ||||||||
Shares issued pursuant to debt settlement | 18,464,921 | 510,572 | ||||||||
Shares issued pursuant to notes conversion | 14,733,733 | 561,687 | ||||||||
All the above share transactions have been retroactively restated for the reverse stock split described in Note 9. | ||||||||||
SUPPLEMENTAL_CASH_FLOW_INFORMA2
SUPPLEMENTAL CASH FLOW INFORMATION AND NON-CASH INVESTING AND FINANCING ACTIVITIES (Tables 1) | 6 Months Ended | ||||||||
Jun. 30, 2014 | |||||||||
Supplemental Cash Flow Elements [Abstract] | ' | ||||||||
Additional disclosure on non-cash transactions | ' | ||||||||
Period Ended June 30, | |||||||||
2014 | 2013 | ||||||||
Interest paid in cash | $ | - | $ | - | |||||
Income taxes paid | $ | - | $ | - | |||||
DERIVATIVE_WARRANT_LIABILITY_A1
DERIVATIVE WARRANT LIABILITY AND FAIR VALUE (Tables) | 6 Months Ended | ||||||||
Jun. 30, 2014 | |||||||||
Notes to Financial Statements | ' | ||||||||
Warrants and conversion option | ' | ||||||||
31-Dec-13 | 30-Jun-14 | ||||||||
Expected Life (Years) | Risk free Rate | Dividend yield | Volatility | Expected Life (Years) | Risk free Rate | Dividend yield | Volatility | ||
Share purchase warrants | 0.85 to 2.78 | 0.13% to 0.78% | 0.00% | 199% | 0.35 to 2.28 | 0.04% to 0.47% | 0.00% | 199% | |
31-Dec-13 | 30-Jun-14 | ||||||||
Expected Life (Years) | Risk free Rate | Dividend yield | Volatility | Expected Life (Years) | Risk free Rate | Dividend yield | Volatility | ||
Conversion option | 0.16 to 0.53 | 0.04% to 0.10% | 0.00% | 199% | Nil | Nil | Nil | Nil | |
DERIVATIVE_WARRANT_LIABILITY_A2
DERIVATIVE WARRANT LIABILITY AND FAIR VALUE (Tables 1) | 6 Months Ended | ||||||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||||||
Notes to Financial Statements | ' | ||||||||||||||||||||
Derivative liability - warrants and Derivative liability - conversion option | ' | ||||||||||||||||||||
As of June 30, 2014 | |||||||||||||||||||||
Fair Value Measurements | |||||||||||||||||||||
Carrying Value | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||
Derivative liability - warrants | $ | 298,459 | - | - | $ | 298,459 | $ | 298,459 | |||||||||||||
Total | $ | 298,459 | - | - | $ | 298,459 | $ | 298,459 | |||||||||||||
As of December 31, 2013 | |||||||||||||||||||||
Fair Value Measurements | |||||||||||||||||||||
Carrying Value | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||
Derivative liability - warrants | $ | 140,504 | - | - | $ | 140,504 | $ | 140,504 | |||||||||||||
Derivative liability – conversion option | 582,300 | - | - | 582,300 | 582,300 | ||||||||||||||||
Total | $ | 722,804 | - | - | $ | 722,804 | $ | 722,804 | |||||||||||||
DERIVATIVE_WARRANT_LIABILITY_A3
DERIVATIVE WARRANT LIABILITY AND FAIR VALUE (Tables 2) | 6 Months Ended | ||||||||||||
Jun. 30, 2014 | |||||||||||||
Notes to Financial Statements | ' | ||||||||||||
Financial assets and liabilities | ' | ||||||||||||
Fair Value Measurements Using Level 3 Inputs | |||||||||||||
Derivative liability - warrants | Derivative liability – conversion option | Total | |||||||||||
Balance, December 31, 2012 | 977,086 | 867,575 | 1,844,661 | ||||||||||
Additions during the year | 206,000 | 810,500 | 1,016,500 | ||||||||||
Total unrealized (gains) or losses included in net loss | (1,042,582 | ) | (1,095,775 | ) | (2,138,357 | ) | |||||||
Balance, December 31, 2013 | 140,504 | 582,300 | 722,804 | ||||||||||
Total unrealized (gains) or losses included in net loss | 157,955 | (582,300 | ) | (424,345 | ) | ||||||||
Balance, June 30, 2014 | $ | 298,459 | $ | - | $ | 298,459 | |||||||
NATURE_OF_OPERATIONS_Details_N
NATURE OF OPERATIONS (Details Narrative) (USD $) | Jun. 30, 2014 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' |
Working capital deficiency | $2,562,606 |
RESEARCH_AGREEMENTS_Details_Na
RESEARCH AGREEMENTS (Details Narrative) (USD $) | Jun. 30, 2014 |
Research and Development [Abstract] | ' |
Accrued of amended agreement | $492,365 |
CONVERTIBLE_NOTES_PAYABLE_Deta
CONVERTIBLE NOTES PAYABLE (Details Narrative) (USD $) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2014 | Dec. 31, 2013 | |
Gain on settlement of debt | $2,912,034 | ' |
Secured Convertible Notes [Member] | ' | ' |
Principal amount | 980,858 | ' |
Common shares | 1,593,850 | ' |
Secured Convertible Notes1 [Member] | ' | ' |
Principal amount | 215,000 | ' |
Common shares | 349,375 | ' |
Secured Convertible Notes2 [Member] | ' | ' |
Principal amount | 30,000 | ' |
Common shares | 48,750 | ' |
Convertible Note [Member] | ' | ' |
Principal amount | ' | 111,430 |
Common shares | ' | 20,500 |
Convertible Note1 [Member] | ' | ' |
Principal amount | 27,500 | ' |
Common shares | 37,500 | ' |
Convertible Note2 [Member] | ' | ' |
Principal amount | 20,000 | ' |
Common shares | 30,000 | ' |
Convertible Note3 [Member] | ' | ' |
Principal amount | ' | 81,360 |
Common shares | ' | 29,444 |
Remaining balance | ' | 24,990 |
Settlement and recognized repaid | ' | 20,000 |
Gain on settlement of debt | ' | 4,990 |
Convertible Note4 [Member] | ' | ' |
Common shares | ' | 53,690 |
Convertible Note5 [Member] | ' | ' |
Principal amount | 10,748 | 30,212 |
Common shares | 20,472 | 36,000 |
Convertible Note6 [Member] | ' | ' |
Principal amount | ' | 189,210 |
Common shares | ' | 31,763 |
Convertible Note7 [Member] | ' | ' |
Common shares | 68,750 | ' |
Convertible Note8 [Member] | ' | ' |
Common shares | 543,636 | ' |
Convertible Note9 [Member] | ' | ' |
Common shares | 40,551 | ' |
Convertible Note10 [Member] | ' | ' |
Common shares | 38,170 | ' |
Convertible Note11 [Member] | ' | ' |
Common shares | 210,233 | ' |
Convertible Note12 [Member] | ' | ' |
Principal amount | 31,688 | 31,733 |
Common shares | 46,443 | ' |
Convertible Note13 [Member] | ' | ' |
Common shares | 350,000 | ' |
Convertible Note14 [Member] | ' | ' |
Common shares | 157,500 | ' |
Convertible Note15 [Member] | ' | ' |
Principal amount | 20,670 | ' |
Common shares | 22,830 | ' |
Convertible Note16 [Member] | ' | ' |
Principal amount | 32,000 | 83,000 |
Common shares | 40,000 | 108,188 |
Convertible Note17 [Member] | ' | ' |
Common shares | 156,250 | ' |
Convertible Note18 [Member] | ' | ' |
Common shares | 385,000 | ' |
Convertible Note19 [Member] | ' | ' |
Common shares | 560,000 | ' |
Convertible Notes I [Member] | ' | ' |
Common shares | 1,750,000 | ' |
Convertible Notes II [Member] | ' | ' |
Common shares | 1,093,900 | ' |
Debt discount | $492,296 | ' |
LOANS_PAYABLE_Details_Narrativ
LOANS PAYABLE (Details Narrative) (USD $) | 6 Months Ended | |
Jun. 30, 2014 | Dec. 31, 2013 | |
Debt Disclosure [Abstract] | ' | ' |
Unsecured loan advances amount | $18,000 | $42,200 |
Investors converted | 21,500 | ' |
Related party converted | $2,700 | ' |
PROMISSORY_NOTE_Details_Narrat
PROMISSORY NOTE (Details Narrative) (USD $) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2014 | Dec. 31, 2013 | |
Equity [Abstract] | ' | ' |
Accounts payable | ' | $210,000 |
Post reverse stock split common shares | 1,400,000 | ' |
Fair value | 3,150,000 | ' |
Loss on settlement of debt | $2,912,034 | ' |
RELATED_PARTY_TRANSACTIONS_Det
RELATED PARTY TRANSACTIONS (Details Narrative) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Related Party Transactions [Abstract] | ' | ' |
Amounts of owing directors and officers fees | $152,000 | $369,345 |
Loans and other advances | ' | $370,200 |
CAPITAL_STOCK_Details_Narrativ
CAPITAL STOCK (Details Narrative) (USD $) | 6 Months Ended | |
Jun. 30, 2014 | Jun. 30, 2013 | |
Received subscription proceeds1 | $165,000 | ' |
Received subscription proceeds | 418,000 | ' |
Shares of common stock | 11,088,081 | ' |
Fair value | 24,952,358 | ' |
Accrued interest | 4,960,982 | ' |
Related parties converted | 721,045 | ' |
Accounts payable and loan shares | 766,444 | ' |
Fair value of approximately | 910,000 | ' |
Stock based consulting and management fees | 3,750 | 29,894 |
Fair Value [Member] | ' | ' |
Fair value | 151,821 | ' |
Fair Value1 [Member] | ' | ' |
Fair value | 337,500 | ' |
Fair Value2 [Member] | ' | ' |
Fair value | 761,250 | ' |
Fair Value3 [Member] | ' | ' |
Fair value | 58,750 | ' |
Fair Value4 [Member] | ' | ' |
Fair value | 2,981,231 | ' |
Fair Value5 [Member] | ' | ' |
Fair value | 211,658 | ' |
Fair Value6 [Member] | ' | ' |
Fair value | $204,349 | ' |
Common Stock [Member] | ' | ' |
Shares of common stock | 58,787 | ' |
Common Stock1 [Member] | ' | ' |
Shares of common stock | 150,000 | ' |
Common Stock2 [Member] | ' | ' |
Shares of common stock | 145,000 | ' |
Common Stock3 [Member] | ' | ' |
Shares of common stock | 12,500 | ' |
Common Stock4 [Member] | ' | ' |
Shares of common stock | 845,075 | ' |
Common Stock5 [Member] | ' | ' |
Shares of common stock | 81,472 | ' |
Common Stock6 [Member] | ' | ' |
Shares of common stock | 46,443 | ' |
Series B Convertible Preferred Stock | ' | ' |
Preferred stock | 418,000 | ' |
CONTINGENCIES_AND_COMMITMENTS_
CONTINGENCIES AND COMMITMENTS (Details Narrative) | 6 Months Ended |
Jun. 30, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | ' |
Grant shares | 250,000 |
Issued common shares | 150,000 |