Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2015 | Nov. 11, 2015 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2015 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | VRME | |
Entity Registrant Name | VerifyMe, Inc. | |
Entity Central Index Key | 1,104,038 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 5,976,687 |
Balance Sheets
Balance Sheets - USD ($) | Sep. 30, 2015 | Dec. 31, 2014 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 277,967 | $ 63,956 |
Accounts receivable | 69,237 | |
Inventory | 98,581 | 97,360 |
Prepaid expenses | 171,053 | 181,086 |
TOTAL CURRENT ASSETS | 616,838 | 342,402 |
PROPERTY AND EQUIPMENT | ||
Capital equipment, net of accumulated depreciation of $213,226 and $161,205 as of September 30, 2015 and December 31, 2014 | 25,232 | 74,821 |
OTHER ASSETS | ||
Deposits | 37,197 | 37,197 |
Patents and Trademark, net of accumulated amortization of $131,111 and $118,502 as of September 30, 2015 and December 31, 2014 | 95,077 | 107,586 |
TOTAL OTHER ASSETS | 132,274 | 144,783 |
TOTAL ASSETS | 774,344 | 562,006 |
CURRENT LIABILITIES | ||
Accounts payable and accrued expenses | 509,485 | 5,217,770 |
Accrued interest - related parties | 43,215 | |
Deferred revenue | 16,667 | |
Senior secured convertible notes payable - related parties | 114,000 | |
Notes payable | 50,000 | 812,553 |
TOTAL CURRENT LIABILITIES | 559,485 | 6,204,205 |
LONG-TERM LIABILITIES | ||
Warrant liability | 1,829,757 | 6,370,709 |
Accrued interest - related parties | 112,885 | |
TOTAL LONG-TERM LIABILITIES | 1,829,757 | 6,483,594 |
TOTAL LIABILITIES | $ 2,389,242 | $ 12,687,799 |
CONTINGENCIES | ||
STOCKHOLDERS' DEFICIT | ||
Common stock, $.001 par value; 675,000,000 shares authorized; 6,259,727 and 3,969,106 shares issued, and 5,909,187 and 3,618,566 shares outstanding at September 30, 2015 and December 31, 2014 | $ 5,909 | $ 3,618 |
Additional paid in capital | 39,120,912 | 25,047,050 |
Treasury stock, at cost (350,540 shares at September 30, 2015 and December 31, 2014) | (113,389) | (113,389) |
Deferred compensation | (1,928,742) | |
Accumulated deficit | (38,700,030) | (37,696,405) |
STOCKHOLDERS' DEFICIT | (1,614,898) | (12,125,793) |
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT | 774,344 | 562,006 |
Series A Convertible Preferred Stock | ||
STOCKHOLDERS' DEFICIT | ||
Series A Convertible Preferred Stock, $ .001 par value; 37,564,767 shares authorized; 441,938 shares issued and outstanding as of September 30, 2015 and 75,000,000 shares authorized; 248,366 issued and outstanding as of December 31, 2014 | $ 442 | $ 633,333 |
Balance Sheets (Parenthetical)
Balance Sheets (Parenthetical) - USD ($) | Sep. 30, 2015 | Dec. 31, 2014 |
Accumulated depreciation on capital equipment | $ 213,226 | $ 161,205 |
Accumulated amortization, patent and trademarks | $ 131,111 | $ 118,502 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 675,000,000 | 675,000,000 |
Common stock, shares issued | 6,259,727 | 3,969,106 |
Common stock, shares outstanding | 5,909,187 | 3,618,566 |
Treasury stock, shares | 350,540 | 350,540 |
Series A Convertible Preferred Stock | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 37,564,767 | 75,000,000 |
Preferred stock, shares issued | 441,938 | 248,366 |
Preferred stock, shares outstanding | 441,938 | 248,366 |
Series B Convertible Preferred Stock | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 85 | 0 |
Preferred stock, shares issued | 1 | 0 |
Preferred stock, shares outstanding | 1 | 0 |
Statements of Operations (Unaud
Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | ||
NET REVENUES | |||||
Sales | $ 138,475 | $ 53,260 | $ 200,600 | $ 118,408 | |
Royalties | 4,167 | 16,667 | |||
TOTAL NET REVENUE | 142,642 | 53,260 | 217,267 | 118,408 | |
COST OF SALES | 28,689 | 50,160 | 64,768 | 104,600 | |
GROSS PROFIT | 113,953 | 3,100 | 152,499 | 13,808 | |
OPERATING EXPENSES | |||||
General and administrative | 215,787 | 180,626 | 379,817 | 420,937 | |
Legal and accounting | 170,506 | 50,714 | 398,941 | 341,912 | |
Payroll expenses | [1] | 747,333 | 230,399 | 1,037,472 | 1,743,572 |
Research and development | [2] | 58,415 | 106,674 | 2,194,801 | 1,055,290 |
Sales and marketing | [3] | 37,189 | 40,656 | 60,316 | 166,475 |
Total operating expenses | 1,229,230 | 609,069 | 4,071,347 | 3,728,186 | |
LOSS BEFORE OTHER INCOME | (1,115,277) | (605,969) | (3,918,848) | (3,714,378) | |
OTHER INCOME (EXPENSE) | |||||
Interest expense | (4,284) | (83,663) | (59,438) | (107,691) | |
Gain (loss) on extinguishment of debt | (19,395) | 332,523 | (82,000) | ||
Change in fair value of warrants | 1,355,293 | (824,283) | 2,642,138 | 2,012,289 | |
Change in fair value of embedded derivative liability | (200,000) | 400,000 | |||
TOTAL OTHER INCOME (EXPENSE) | 1,331,614 | (1,107,946) | 2,915,223 | 2,222,598 | |
NET INCOME (LOSS) | $ 216,337 | $ (1,713,915) | $ (1,003,625) | $ (1,491,780) | |
EARNINGS (LOSS) PER SHARE | |||||
BASIC | $ 0.04 | $ (0.47) | $ (0.22) | $ (0.42) | |
DILUTED | $ 0.03 | $ (0.47) | $ (0.22) | $ (0.42) | |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING | |||||
BASIC | 5,859,187 | 3,618,566 | 4,474,383 | 3,559,528 | |
DILUTED | 7,462,128 | 3,618,566 | 4,474,383 | 3,559,528 | |
[1] | Includes share based compensation of $550,837 and $591,129 for the three and nine months ended September 30, 2015, and $40,326 and $842,592 for the three and nine months ended September 30, 2014. | ||||
[2] | Includes share based compensation of $0 and $2,000,000 for the three and nine months ended September 30, 2015, and $0 and $400,000 for the three and nine months ended September 30, 2014, related to licensing agreements. | ||||
[3] | Includes share based compensation of $12,500 for the three and nine months ended September 30, 2015, and $0 for the three and nine months ended September 30, 2014. |
Statements of Operations (Unau5
Statements of Operations (Unaudited) (Parenthetical) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Payroll expenses | ||||
Share based compensation | $ 550,837 | $ 40,326 | $ 591,129 | $ 842,592 |
Research and Development Expense | ||||
Share based compensation | 0 | 0 | 2,000,000 | 400,000 |
Sales and Marketing Expenses | ||||
Share based compensation | $ 12,500 | $ 0 | $ 12,500 | $ 0 |
Statement of Changes in Stockho
Statement of Changes in Stockholders' Deficit - 9 months ended Sep. 30, 2015 - USD ($) | Total | Series A Convertible Preferred Stock | Series B Convertible Preferred Stock | Common Stock | Additional Paid-In Capital | Treasury Stock | Deferred Compensation | Accumulated Deficit |
Balance at Dec. 31, 2014 | $ (12,125,793) | $ 633,333 | $ 3,618 | $ 25,047,050 | $ (113,389) | $ (37,696,405) | ||
Balance (in shares) at Dec. 31, 2014 | 248,366 | 3,618,566 | ||||||
Conversion of Series A Convertible Preferred Stock into common stock | $ (633,333) | $ 248 | 633,085 | |||||
Conversion of Series A Convertible Preferred Stock into common stock (in shares) | (248,366) | 248,366 | ||||||
Sale of stock | 1,278,501 | $ 390 | 1,278,111 | |||||
Sale of stock (in shares) | 389,668 | |||||||
Conversion of stockholder deferred compensation into Series A Convertible Preferred Stock | 35,000 | $ 10 | 34,990 | |||||
Conversion of stockholder deferred compensation into Series A Convertible Preferred Stock (in shares) | 10,667 | |||||||
Conversion of notes payable and accrued interest into Series A Convertible Preferred Stock | 136,813 | $ 42 | 136,771 | |||||
Conversion of notes payable and accrued interest into Series A Convertible Preferred Stock (in shares) | 41,603 | |||||||
Conversion of accrued expenses into Series B Convertible Preferred Stock | 8,367,417 | 8,367,417 | ||||||
Conversion of accrued expenses into Series B Convertible Preferred Stock (in shares) | 1 | |||||||
Sale of stock | 50,000 | $ 305 | 49,695 | |||||
Sale of stock (in shares) | 304,785 | |||||||
Conversion of warrants | 37,000 | $ 44 | 36,956 | |||||
Conversion of warrants (in shares) | 43,529 | |||||||
Conversion of stockholder notes payable and accrued interest into common stock | 731,426 | $ 674 | 730,752 | |||||
Conversion of stockholder notes payable and accrued interest into common stock (in shares) | 673,706 | |||||||
Conversion of accounts payable and accrued expenses into common stock | 99,447 | $ 117 | 99,330 | |||||
Conversion of accounts payable and accrued expenses into common stock (in shares) | 116,997 | |||||||
Cashless exercise of options into common stock | $ 2 | (2) | ||||||
Cashless exercise of options into common stock (in shares) | 2,353 | |||||||
Issuance of stock for services | $ 900 | 2,130,750 | $ (2,131,650) | |||||
Issuance of stock for services (in shares) | 900,000 | |||||||
Forgiveness of stockholder compensation | 175,287 | 175,287 | ||||||
Amortization of deferred compensation | 202,908 | 202,908 | ||||||
Fair value of employee stock options | 400,721 | 400,721 | ||||||
Rounding of partial shares relative to reverse split | $ 1 | (1) | ||||||
Rounding of partial shares relative to reverse split (in shares) | 885 | |||||||
Net loss | (1,003,625) | (1,003,625) | ||||||
Balance at Sep. 30, 2015 | $ (1,614,898) | $ 442 | $ 5,909 | $ 39,120,912 | $ (113,389) | $ (1,928,742) | $ (38,700,030) | |
Balance (in shares) at Sep. 30, 2015 | 441,938 | 1 | 5,909,187 |
Statement of Changes in Stockh7
Statement of Changes in Stockholders' Deficit (Parenthetical) | 9 Months Ended |
Sep. 30, 2015USD ($) | |
Common Stock | |
Gain on conversion of stockholder notes payable and accrued interest | $ 297,370 |
Statements of Cash Flows (Unaud
Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net loss | $ (1,003,625) | $ (1,491,780) |
Adjustments to reconcile net loss to net cash used in operating activities | ||
Gain on conversion of debt | (332,523) | |
Fair value of options issued in exchange for services | 400,721 | 842,592 |
Accretion of discount on notes payable | 10,447 | |
Change in fair value of warrant liability | (2,642,138) | (2,012,289) |
Change in fair value of embedded derivative liability | (400,000) | |
Fair value of stock in excess of converted notes payable and accrued interest | 82,000 | |
Amortization and depreciation | 64,629 | 61,771 |
Stock and warrants issued in exchange for technology | 844,000 | |
Amortization of deferred compensation | 202,908 | |
(Increase) decrease in assets | ||
Accounts receivable | (69,237) | (22,936) |
Inventory | (1,221) | (100,173) |
Prepaid expenses | 10,033 | 7,896 |
Increase (decrease) in liabilities | ||
Accounts payable and accrued expenses | 2,155,173 | 256,551 |
Deferred revenue | (16,667) | |
Net cash used in operating activities | (1,221,500) | (1,932,368) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchase of equipment | (2,432) | |
Purchase of patents | (100) | |
Net cash used in investing activities | (2,532) | |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from issuance of notes payable | 159,542 | 650,000 |
Repayment of notes payable | (50,000) | |
Proceeds from sale of Series A Convertible Preferred Stock | 1,278,501 | |
Proceeds from sale of common stock | 50,000 | |
Net cash provided by financing activities | 1,438,043 | 650,000 |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 214,011 | (1,282,368) |
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD | 63,956 | 1,285,973 |
CASH AND CASH EQUIVALENTS - END OF PERIOD | 277,967 | 3,605 |
Cash paid during the year for: | ||
Interest | 6,646 | |
Income taxes | 0 | 0 |
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES | ||
Fair value of stock issued for conversion of notes payable and accrued interest | 731,426 | 506,588 |
Fair value of warrants issued as debt discount | $ 151,005 | |
Cashless exercise of warrants | 2 | |
Series A Convertible Preferred Stock converted to common stock | 633,333 | |
Issuance of Series A Convertible Preferred Stock for deferred compensation | 35,000 | |
Issuance of Series A Convertible Preferred Stock for notes payable and accrued interest | 136,813 | |
Issuance of Series B Convertible Preferred Stock for accrued expenses | 6,500,000 | |
Conversion of warrants into Series B Convertible Preferred Stock | 1,867,417 | |
Conversion of warrants to common stock | 37,000 | |
Conversion of accounts payable and accrued expenses into common stock | 99,447 | |
Common stock issued for deferred compensation | 2,131,650 | |
Forgiveness of stockholder compensation | $ 175,287 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of the Business On July 14, 2015, LaserLock Technologies, Inc. changed its name to VerifyMe, Inc., effective July 23, 2015. As used in this report, unless the context otherwise indicates, any reference to “VerifyMe,” “our Company,” “the Company,” “us,” “we” and “our” refers to VerifyMe, Inc. a Nevada corporation. The Company was incorporated in the State of Nevada on November 10, 1999. The Company is based in New York, New York and its common stock, par value $0.001 per share (the “Common Stock”), is traded on the over-the-counter market and quoted on the OTC Pink, organized by the OTC Markets Group, Inc., and the OTC Bulletin Board under the ticker symbol “VRME.” A high-tech solutions company in the field of authenticating people and products, the Company offers state-of-the-art solutions to combat identity fraud and counterfeiting utilizing multi-factor authentication and a suite of security pigments for governments, health care providers, the gaming industry, the financial services industry and high-end retailers. The Company invests in developing new proprietary color shifting inks that it believes will allow it to penetrate broader markets and result in increased revenues. The Company refines its technologies and their applications, and now has what it believes to be one of the most cost effective and efficient authentication technologies available. Its most recent technology takes advantage of the new ubiquitous energy efficient fluorescent lighting to change the color of ink, resulting in numerous potential new applications ranging from credit cards to drivers licenses, passports, stock certificates, clothing labels, currency, ID cards, and tax stamps. The technologies can also be used to protect DVDs, apparel, pharmaceuticals, and virtually any other physical product. The Company’s digital solution is a multi-platform (iOS and Android) strong authentication solution that integrates biometrics and geo-location tagging. The solution completely eliminates passwords and the inherently weak security they provide. The solution also removes the user complexity associated with having to manage many complex passwords. The solution can be delivered either as a high availability cloud service, managed by the Company, or as a licensed software product for operation on the client’s premises. The solution integrates three independent authentication factors — something you have (for instance a smartphone), something you know (for instance a color gesture swipe) and something you are (for instance your facial geometry) into a simple, fast, intuitive solution. The system can also accurately determine the precise location of the individual using a variety of mechanisms including GPS, cell tower triangulation, IP or Wi-Fi address. Because the solution incorporates biometrics it completely eliminates the possibility that users might share their authentication credentials. The combination of biometrics and geolocation provides extremely strong transactional evidence, making it nearly impossible for an end-user to refute having been part of a transaction. The Company’s activities are subject to significant risks and uncertainties, including the need to secure additional funding to operationalize the Company’s current technology. Basis of Presentation The accompanying unaudited financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information and with the instructions for Form 10-Q and Rule 8-03 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. The accompanying unaudited financial statements should be read in conjunction with the financial statements and notes included in the Company’s Annual Report on form 10-K for the year ended December 31, 2014 as filed with the SEC. Operating results for the three and nine months ended September 30, 2015 are not necessarily indicative of the results that may be expected for the year ending December 31, 2015. Reverse Stock Split and Changes to Company’s Preferred Stock On May 26, 2015, the board of directors of the Company (the “Board”), acting by written consent in lieu of a special meeting, unanimously approved and adopted: (a) a reverse stock split of all of the Company’s issued and outstanding capital stock based on a minimum 1-for-40 split, up to a maximum 1-for-100 split (the “Reverse Stock Split”), and recommended the same for the Company’s stockholders for approval, and (b) a Second Amended Certificate of Designation for Series A Preferred Stock, which amended the designations, preferences, powers and rights of the shares of the Company’s Series A convertible preferred stock, par value $0.001 per share (the “Series A Preferred Stock”), which were originally set forth in that certain Amended Certificate of Designation for Series A Preferred Stock, dated December 19, 2003. On May 28, 2015, those stockholders of the Company holding a majority of the issued and outstanding shares of Common Stock and Series A Preferred Stock, acting by written consent in lieu of a special meeting, voted to approve the Reverse Stock Split. On June 11, 2015, at a duly authorized special meeting of the Board, the Board (a) finalized, adopted and approved a resolution setting the Reverse Stock Split exchange ratio to a 1-for-85 split and (b) approved and adopted a new Certificate of Designation for Series B Preferred Stock, establishing the designations, preferences, powers and rights of the shares of the Company’s Series B convertible preferred stock, par value $0.001 per share (the “Series B Preferred Stock,” and together with the Series A Preferred Stock, the “Preferred Stock”). On July 23, 2015, the Company completed the 1-for-85 Reverse Stock Split of all of its outstanding Common Stock and Preferred Stock. The total number of authorized capital stock of the Company remained unchanged at its current total of 750,000,000, with 675,000,000 designated as Common Stock and 75,000,000 designated as Preferred Stock. The accompanying financial statements and notes to the financial statements give retroactive effect to the Reverse Stock Split for all periods presented, unless otherwise specified. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. Comprehensive Income The Company follows Financial Accounting Standards Board Accounting Standards Codification (“FASB ASC”) 220, “Comprehensive Income,” in reporting comprehensive income. Comprehensive income is a more inclusive financial reporting methodology that includes disclosure of certain financial information that historically has not been recognized in the calculation of net income. Since the Company has no items of other comprehensive income (loss), comprehensive income (loss) is equal to net income (loss). Fair Value of Financial Instruments The Company’s financial instruments consist of accounts receivable, accounts payable and accrued expenses, warrant liability and notes payable. The carrying value of accounts receivable, accounts payable and accrued expenses approximate their fair value because of their short maturities. The Company follows FASB ASC 820, “Fair Value Measurements and Disclosures,” and applies it to all assets and liabilities that are being measured and reported on a fair value basis. The statement requires that assets and liabilities carried at fair value will be classified and disclosed in one of the following three categories: Level 1: Quoted market prices in active markets for identical assets or liabilities Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data Level 3: Unobservable inputs that are not corroborated by market data The level in the fair value within which a fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. Cash and Cash Equivalents For purposes of reporting cash flows, the Company considers all cash accounts, which are not subject to withdrawal restrictions or penalties, and certificates of deposit and commercial paper with original maturities of 90 days or less to be cash or cash equivalents. Concentration of Credit Risk Involving Cash and Cash Equivalents The Company’s cash and cash equivalents are held at one financial institution. At times, the Company’s deposits may exceed Federal Deposit Insurance Corporation (FDIC) coverage limits. The Company has not experienced any losses from maintaining cash accounts in excess of federally insured limits. Inventory Inventory principally consists of penlights and pigments and is stated at the lower of cost (determined by the first-in, first-out method) or market. Property and Equipment Property and equipment is stated at cost. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, principally five to seven years. Maintenance and repairs of property are charged to operations, and major improvements are capitalized. Upon retirement, sale, or other disposition of property and equipment, the costs and accumulated depreciation are eliminated from the accounts, and any resulting gain or loss is included in operations. Patents and Trademark Currently the Company has twenty U.S. patents, four U.S. and seven applications pending for allowance. The Company has also purchased a trademark. Costs associated with the registration and legal defense of the patents have been capitalized and are amortized on a straight-line basis over the estimated lives of the patents which were determined to be 17 to 20 years. Long-Lived Assets The Company evaluates the recoverability of its long-lived assets in accordance with FASB ASC 360, “Property, Plant, and Equipment.” The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of long-lived assets are measured by a comparison of the carrying amount of an asset to future cash flows expected to be generated by the asset, undiscounted and without interest or independent appraisals. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset exceeds the fair value of the assets. Deferred Financing Costs Costs incurred in securing long-term debt are deferred and amortized, as a charge to interest expense, over the term of the related debt. In the case of long-term debt modifications, the Company follows the guidance provided by FASB ASC 470-50, “Debt – Modification and Extinguishments” (“FASB ASC 470-50”). Convertible Notes Payable Convertible notes payable, for which the embedded conversion feature does not qualify for derivative treatment, are evaluated to determine if the effective or actual rate of conversion per the terms of the convertible note agreement is below market value. In these instances, the Company accounts for the value of the beneficial conversion feature (BCF) as a debt discount, which is then accreted to interest expense over the life of the related debt using the straight-line method which approximates the effective interest method. Derivative Instruments The Company evaluates its convertible debt, Preferred Stock, warrants or other contracts to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with FASB ASC 480, “Distinguish by Liabilities from Equity” (FASB ASC 480), and FASB ASC 815, “Derivatives and Hedging” (“FASB ASC 815”). The result of this accounting treatment is that the fair value of the embedded derivative, if required to be bifurcated, is marked-to-market at each balance sheet date and recorded as a liability. The change in fair value is recorded in the Statement of Operations as a component of other income or expense. Upon conversion or exercise of a derivative instrument, the instrument is marked to fair value at the conversion date and then that fair value is reclassified to equity. In circumstances where the embedded conversion option in a convertible instrument is required to be bifurcated and there are also other embedded derivative instruments in the convertible instrument that are required to be bifurcated, the bifurcated derivative instruments are accounted for as a single, compound derivative instrument. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. Equity instruments that are initially classified as equity that become subject to reclassification are reclassified as liabilities at the fair value of the instrument on the reclassification date. Derivative instrument liabilities will be classified in the balance sheet as current or non-current based on whether net-cash settlement of the derivative instrument is expected within 12 months of the balance sheet date. Revenue Recognition In accordance with FASB ASC 605, “Revenue Recognition,” the Company recognizes revenue when (i) persuasive evidence of a customer or distributor arrangement exists, (ii) a retailer, distributor or wholesaler receives the goods and acceptance occurs, (iii) the price is fixed or determinable, and (iv) collectability of the revenue is reasonably assured. Subject to these criteria, the Company recognizes revenue from product sales, consisting mainly of pigments and penlights, upon shipment to the customer. Royalty revenue is recognized upon receipt of notification from a customer that the Company’s product has been used in the customer’s production process. Income Taxes The Company follows FASB ASC 740, “Income Taxes,” when accounting for income taxes, which requires an asset and liability approach to financial accounting and reporting for income taxes. Deferred income tax assets and liabilities are computed annually for temporary differences between the financial statements and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Income tax expense is the tax payable or refundable for the period plus or minus the change during the period in deferred tax assets and liabilities. Tax years from 2011 through 2014 remain subject to examination by major tax jurisdictions. Stock-based Payments The Company accounts for stock-based compensation under the provisions of FASB ASC 718, “Compensation—Stock Compensation”, which requires the measurement and recognition of compensation expense for all stock-based awards made to employees and directors based on estimated fair values on the grant date. The Company estimates the fair value of stock-based awards on the date of grant using the Black-Scholes model. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods using the straight-line method. The Company accounts for stock-based compensation awards to non-employees in accordance with FASB ASC 505-50, “Equity-Based Payments to Non-Employees” (“FASB ASC 505-50”). Under FASB ASC 505-50, the Company determines the fair value of the warrants or stock-based compensation awards granted as either the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. All issuances of stock options or other equity instruments to non-employees as consideration for goods or services received by the Company are accounted for based on the fair value of the equity instruments issued. Non-employee equity based payments are recorded as an expense over the service period, as if the Company had paid cash for the services. At the end of each financial reporting period, prior to vesting or prior to the completion of the services, the fair value of the equity based payments will be re-measured and the non-cash expense recognized during the period will be adjusted accordingly. Since the fair value of equity based payments granted to non-employees is subject to change in the future, the amount of the future expense will include fair value re-measurements until the equity based payments are fully vested or the service completed. Advertising Costs Advertising costs are expensed as incurred. Advertising costs were approximately $200 and $458 for the three and nine months ended September 30, 2015 and $9,000 and $62,238 for the three and nine months ended September 30, 2014 and are included in sales and marketing expenses. Research and Development Costs In accordance with FASB ASC 730, “Research and Development,” research and development costs are expensed when incurred. Research and development costs were $58,062 and $2,194,448 for the three and nine months ended September 30, 2015 and $13,601 and $889,450 for the three and nine months ended September 30, 2014. Basic and Diluted Net Income per Share of Common Stock The Company follows FASB ASC 260, “Earnings Per Share,” when reporting Earnings Per Share resulting in the presentation of basic and diluted earnings per share. Basic net income per common share is based on the weighted average number of shares outstanding during the periods presented. Diluted net income per common share is computed using the weighted average number of common shares plus dilutive common share equivalents outstanding during the period. Potential common shares that would have the effect of increasing diluted earnings per share are considered to be anti-dilutive, i.e., the exercise prices of the outstanding stock options were greater than the market price of the Common Stock. Anti-dilutive Common Stock equivalents, which were excluded from the calculation of number of dilutive common stock equivalents, amounted to 19,237,648 shares for the three months ended September 30, 2015. Segment Information The Company is organized and operates as one operating segment wherein the Company’s patented technologies are utilized to address counterfeiting issues. In accordance with FASB ASC 280, “Segment Reporting” (“FASB ASC 280”), the chief operating decision-maker has been identified as the Chief Executive Officer, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company. Since the Company operates in one segment and provides one group of similar products, all financial segment and product line information required by FASB ASC 280 can be found in the financial statements. Recently Adopted Accounting Pronouncements As of September 30, 2015 and for the three and nine months then ended, there were no recently adopted accounting pronouncements that had a material effect on the Company’s financial statements. Recently Issued Accounting Pronouncements Not Yet Adopted As of September 30, 2015, there are no recently issued accounting standards not yet adopted which would have a material effect on the Company’s financial statements through 2017. Reclassifications Certain amounts in the 2014 statement of operations have been reclassified in order for them to conform with the 2015 presentation. |
Management Plans
Management Plans | 9 Months Ended |
Sep. 30, 2015 | |
Text Block [Abstract] | |
Management Plans | NOTE 2 – MANAGEMENT PLANS The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. The Company has incurred significant losses and experienced negative cash flow from operations. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. The Company does not believe that its existing cash resources will be sufficient to sustain operations during the next twelve months. The Company currently needs to generate revenue in order to sustain its operations. In the event that the Company cannot generate sufficient revenue to sustain its operations, the Company will need to reduce expenses or obtain financing through the sale of debt and/or equity securities. The issuance of additional equity would result in dilution to existing stockholders. If the Company is unable to obtain additional funds when they are needed or if such funds cannot be obtained on terms acceptable to the Company, the Company may be unable to execute upon the business plan or pay costs and expenses as they are incurred, which could have a material, adverse effect on the business, financial condition and results of operations. If sufficient revenues are not generated to sustain operations or additional funding cannot be obtained in the short term, the Company will need to reduce monthly expenditures to a level that will enable the Company to continue until such funds can be obtained. Successful completion of the Company’s development program, and the attainment of profitable operations are dependent upon future events, including obtaining adequate financing to fulfill its development activities and achieving a level of sales adequate to support the Company’s cost structure. However, there can be no assurances that the Company will be able to secure additional equity investment or achieve an adequate sales level. |
Property and Equipment
Property and Equipment | 9 Months Ended |
Sep. 30, 2015 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | NOTE 3 – PROPERTY AND EQUIPMENT Property and Equipment consists of the following: September 30, December 31, Furniture and Fixtures $ 219,871 $ 219,871 Equipment 18,587 16,155 238,458 236,026 Less: Accumulated depreciation 213,226 161,205 $ 25,232 $ 74,821 Depreciation of property and equipment was $17,394 and $52,021 for the three and nine months ended September 30, 2015 and $17,313 and $51,940 for the three and nine months ended September 30, 2014. |
Patents and Trademark
Patents and Trademark | 9 Months Ended |
Sep. 30, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Patents and Trademark | NOTE 4 – PATENTS AND TRADEMARK Currently the Company has twenty U.S. patents, four U.S. and seven applications pending for allowance. Accordingly, costs associated with the registration and legal defense of these patents have been capitalized and are amortized on a straight-line basis over the estimated lives of the patents which were determined to be 17 to 20 years. The trademark is also being amortized on a straight-line basis over its estimated useful life of 20 years. During three and nine months ended September 30, 2015 and 2014, the Company capitalized $0 of patent costs and trademarks. Amortization expense for patents and trademarks was $4,203 and $12,608 for the three and nine months ended September 30, 2015 and $3,277 and $9,831 for the three and nine months ended September 30, 2014. On March 30, 2015, the Company was advised by the United States Patent and Trademark Office (“USPTO”) that its petition for an unintentional delayed payment for an unpaid maintenance fee to reinstate its patent was granted by the USPTO. The patent, for a counterfeiting ink detection system, was granted on November 2, 2004. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | NOTE 5 – INCOME TAXES Income tax expense was $0 for the three and nine months ended September 30, 2015 and 2014. As of January 1, 2015, the Company had no unrecognized tax benefits, and accordingly, the Company did not recognize interest or penalties during 2014 related to unrecognized tax benefits. There has been no change in unrecognized tax benefits during the three and nine months ended September 30, 2015, and there was no accrual for uncertain tax positions as of September 30, 2015. Tax years from 2011 through 2014 remain subject to examination by major tax jurisdictions. There is no income tax benefit for the losses for the nine months ended September 30, 2015 and for the three and nine months ended September 30, 2014 since management has determined that the realization of the net tax deferred asset is not assured and has created a valuation allowance for the entire amount of such benefits. The Company had income for the three months ended September 30, 2015; however, due to tax adjustments, the Company had a loss for income tax purposes. |
Recapitalization Transaction
Recapitalization Transaction | 9 Months Ended |
Sep. 30, 2015 | |
Brokers and Dealers [Abstract] | |
Recapitalization Transaction | NOTE 6 – RECAPITALIZATION TRANSACTION On or about June 12, 2015, the Company entered into definitive agreements to restructure the overall capitalization of the Company (the “Recapitalization Transaction”). To effectuate the Recapitalization Transaction, the Company entered into a Master Acquisition Agreement (the “Master Agreement”) with OPC Partners LLC, a Delaware limited liability company (“OPC”), VerifyMe Inc., a Texas corporation (“VFM”), Zaah Technologies, Inc., a Delaware corporation (“Zaah”), and an additional private investor (the “Private Investor”). Pursuant to the Master Agreement, the Company entered into several other material definitive agreements (collectively, the “Transaction Documents”) required to consummate the Recapitalization Transaction. A brief summary of the Transaction Documents is included below. Each of the Transaction Documents was entered effective as of June 12, 2015, upon the closing of the Recapitalization Transaction. Note Conversion Agreement. Warrant Conversion Agreement. Preferred Stock Conversion Agreement. Patent and Technology License Termination Agreement. Termination of Registration Rights. Termination of Technology and Services Agreement. Termination of Investment Agreement. Patent Purchase Agreement. Termination of Zaah Technology and Services Agreement. Series A Preferred Stock Subscription Agreement. Common Stock Subscription Agreement. Series B Preferred Stock Subscription Agreement. The foregoing description of the Master Agreement and the related Transaction Documents is a summary, and does not purport to be a complete description of the Master Agreement and the related Transaction Documents, and is qualified in its entirety by reference to the Master Agreement and the related Transaction Documents, copies of which are filed as Exhibits 10.1, 10.2 and 10.3 to the Company’s Current Report on Form 8-K, filed with the SEC on June 18, 2015. |
Senior Secured Convertible Note
Senior Secured Convertible Notes Payable -Related Parties | 9 Months Ended |
Sep. 30, 2015 | |
Text Block [Abstract] | |
Senior Secured Convertible Notes Payable -Related Parties | NOTE 7 – SENIOR SECURED CONVERTIBLE NOTES PAYABLE – RELATED PARTIES During the second quarter of 2014, $216,249 of principal of the Company’s outstanding senior convertible notes held by a significant stockholder of the Company, plus accrued interest of $208,339, were converted into 8,448,519 shares of Common Stock. The excess of the fair value of the Common Stock over the value of the notes payable and accrued interest, $82,000, was recorded as loss on extinguishment of debt in accordance with FASB ASC 470-50. On June 12, 2015, as part of the Recapitalization Transaction (see Note 6), the Company restructured the Senior Secured Convertible Notes Payable – Related Parties. As a result the principal balance of $114,000 and accrued interest of $118,775 was converted into 154,184 shares (13,105,662 shares pre Reverse Stock Split at $0.018 per share) of the Company’s Common Stock. This resulted in a gain of $103,456. Of this amount, $17,967 was related to a stockholder and recorded as additional paid in capital, with the remaining $85,489 being recorded as a gain on extinguishment of debt. |
Notes Payable
Notes Payable | 9 Months Ended |
Sep. 30, 2015 | |
Debt Disclosure [Abstract] | |
Notes Payable | NOTE 8 – NOTES PAYABLE Notes payable consists of the following at September 30, 2015 and December 31, 2014: September 30, December 31, Unsecured notes payable due to related parties; interest at 10% per annum; principal and accrued interest due at maturity in September 2015 — $ 114,000 Series A notes payable; interest at 8% per annum; principal and accrued interest due at maturity in October 2011 (past due) 50,000 50,000 Notes payable; interest at 8% per annum, principal and accrued interest due at December 1, 2014 (past due) — 650,000 Notes payable; interest at 5% and 8% per annum, principal and accrued interest due at April 2015 — 123,000 Notes payable; interest at 5% per annum, principal and accrued interest due at June 10, 2015 — — Notes payable; interest at 8% per annum, principal and accrued interest due at June 25, 2015 — — Less: Debt discount — (10,447 ) 50,000 926,553 Less: Current portion 50,000 926,553 $ — $ — The warrant liabilities in this section were valued using the Black-Scholes option pricing model, with the following assumptions: no dividend yield, expected volatility of 173.7% to 180.7%, risk free interest rate of 1.75% and expected lives of four to five years. On June 10, 2014, the Company issued a note payable for $250,000, which included fully vested warrants to purchase 1,000,000 shares pre Reverse Stock Split of Common Stock at an exercise price of $0.10 per share, expiring in five years. The warrants were valued at $39,650 using Black-Scholes option pricing model to calculate the grant-date fair value of the warrants, with the following assumptions: no dividend yield, expected volatility of 248.2%, risk free interest rate of 1.67% and expected life of five years. The relative fair value of the warrants was $34,222 and was recorded as a discount to the notes payable in accordance with FASB ASC 835-30-25, “Recognition” (“FASB 835-30-25”) and is being accreted over the term of the note payable for financial statement purposes. For the year ended December 31, 2014, $34,222 was accreted through interest expense. The note and accrued interest at 8% per annum was originally due on December 11, 2014, but the Company received approval to extend the maturity until December 31, 2014. The warrants are subject to anti-dilutive adjustments and are therefore classified as a liability in accordance with FASB ASC 815. The warrant liability is re-valued at each reporting period with the change in fair value recorded through earnings. As of June 12, 2015, the date of conversion in conjunction with the Recapitalization Transaction (see Note 6), the fair value of the warrant liability was $8,113. As a result of the Recapitalization Transaction, the note’s principal balance of $250,000 and accrued interest of $20,263 was converted into 176,471 shares (15,000,000 shares pre Reverse Stock Split at $0.018) of Common Stock. This resulted in a gain of $120,117, and because this individual is a stockholder was recorded as additional paid in capital. On August 5, 2014, the Company issued notes payable for $100,000, which included fully vested warrants to purchase 600,000 shares (pre Reverse Stock Split) of Common Stock at an exercise price of $0.05 per share, expiring in five years. The warrants were valued at $29,725 using Black-Scholes option pricing model to calculate the grant-date fair value of the warrants, with the following assumptions: no dividend yield, expected volatility of 233.8%, risk free interest rate of 1.67% and expected life of five years. The relative fair value of the warrants was $22,914 and was recorded as a discount to the notes payable in accordance with FASB ASC 835-30-25, and is being accreted over the term of the note payable for financial statement purposes. For the year ended December 31, 2014, $22,914 was accreted through interest expense. The note and accrued interest at 8% per annum were due in full on December 1, 2014. The warrants are subject to anti-dilutive adjustments and are therefore classified as a liability in accordance with FASB ASC 815. The warrant liability is re-valued at each reporting period with the change in fair value recorded through earnings. As of June 12, 2015, the date of conversion in conjunction with the Recapitalization Transaction (see Note 6), the fair value of the warrant liability was $5,151. As a result of the Recapitalization Transaction, the principal balance of $50,000 and accrued interest of $3,414 was converted into 34,898 shares (2,966,210 shares pre Reverse Stock Split at $0.018) of the Common Stock. This resulted in a gain of $23,740, which was recorded as a gain on the extinguishment of debt. The remaining $50,000 was paid in full, plus accrued interest in September 2015. The 3,529 warrants (300,000 warrants pre Reverse Stock Split) to purchase shares of Common Stock associated with the $50,000 note payable remain outstanding and must be re-valued at each reporting period with the change in fair value recorded through earnings. As of September 30, 2015, the warrants were valued at $7,899. On August 12, 2014, the Company issued a notes payable for $50,000, which included fully vested warrants to purchase 300,000 shares (pre Reverse Stock Split) of Common Stock at an exercise price of $0.05 per share, expiring in five years. The warrants were valued at $26,817 using Black-Scholes option pricing model to calculate the grant-date fair value of the warrants, with the following assumptions: no dividend yield, expected volatility of 233.8%, risk free interest rate of 1.67% and expected life of five years. The relative fair value of the warrants was $17,455 and was recorded as a discount to the notes payable in accordance with FASB ASC 835-30-25, and is being accreted over the term of the note payable for financial statement purposes. For the year ended December 31, 2014, $17,455 was accreted through interest expense. The note and accrued interest at 8% per annum were due in full on December 1, 2014. The warrants are subject to anti-dilutive adjustments and are therefore classified as a liability in accordance with FASB ASC 815. The warrant liability is re-valued at each reporting period with the change in fair value recorded through earnings. As of June 12, 2015, the date of conversion in conjunction with the Recapitalization Transaction (see Note 6), the fair value of the warrant liability was $2,575. As a result of the Recapitalization Transaction, the principal balance of $50,000 and accrued interest of $3,370 was converted into 34,843 shares (2,961,644 shares pre Reverse Stock Split at $0.018) of Common Stock. This resulted in a gain of $23,720, which was recorded as a gain on the extinguishment of debt. On August 14, 2014, the Company issued a note payable for $100,000, which included fully vested warrants to purchase 600,000 shares pre Reverse Stock Split of Common Stock at an exercise price of $0.05 per share, expiring in five years. The warrants were valued at $47,676 using Black-Scholes option pricing model to calculate the grant-date fair value of the warrants, with the following assumptions: no dividend yield, expected volatility of 233.8%, risk free interest rate of 1.67% and expected life of five years. The relative fair value of the warrants was $32,274 and was recorded as a discount to the notes payable in accordance with FASB ASC 835-30-25 and is being accreted over the term of the note payable for financial statement purposes. For the year ended December 31, 2014, $32,274 was accreted through interest expense. The note and accrued interest at 8% per annum were due in full on December 1, 2014. The warrants are subject to anti-dilutive adjustments and are therefore classified as a liability in accordance with FASB ASC 815. The warrant liability is re-valued at each reporting period with the change in fair value recorded through earnings. As of June 12, 2015, the date of conversion in conjunction with the Recapitalization Transaction (see Note 6), the fair value of the warrant liability was $5,153. As a result of the Recapitalization Transaction, the principal balance of $100,000 and accrued interest of $6,697 was converted into 69,657 shares (5,920,852 shares pre Reverse Stock Split at $0.018) of Common Stock. This resulted in a gain of $47,421, which was recorded as a gain on the extinguishment of debt. On September 8, 2014, the Company issued notes payable for $150,000, which included fully vested warrants to purchase 900,000 shares (pre Reverse Stock Split) of Common Stock at an exercise price of $0.05 per share, expiring in five years. The warrants were valued at $62,544 using Black-Scholes option pricing model to calculate the grant-date fair value of the warrants, with the following assumptions: no dividend yield, expected volatility of 233.8%, risk free interest rate of 1.67% and expected life of five years. The relative fair value of the warrants was $44,140 and was recorded as a discount to the notes payable in accordance with FASB ASC 835-30-25 and is being accreted over the term of the note payable for financial statement purposes. For the year ended December 31, 2014, $44,140 was accreted through interest expense. The note and accrued interest at 8% per annum were due in full on December 1, 2014. The warrants are subject to anti-dilutive adjustments and are therefore classified as a liability in accordance with FASB ASC 815. The warrant liability is re-valued at each reporting period with the change in fair value recorded through earnings. As of June 12, 2015, the date of conversion in conjunction with the Recapitalization Transaction (see Note 6), the fair value of the warrant liability was $7,725. As a result of the Recapitalization Transaction, the principal balance of $150,000 and accrued interest of $9,222 was converted into 103,991 shares (8,839,269 shares pre Reverse Stock Split at $0.018) of Common Stock. This resulted in a gain of $70,766, which was recorded as a gain on the extinguishment of debt. On December 5, 2014, the Company issued a note payable for $23,000 to a stockholder, which bears interest at 5.0% and was due on April 5, 2015. As a result of the Recapitalization Transaction (see Note 6), the principal balance of $23,000 and accrued interest of $609 was converted into 15,418 shares (1,310,510 shares pre Reverse Stock Split at $0.018) of Common Stock. This resulted in a gain of $10,493 and because this entity is a stockholder was recorded as additional paid in capital. On December 31, 2014, the Company issued a note payable for $100,000, which include fully vested warrants to purchase 600,000 shares (pre Reverse Stock Split) of Common Stock at an exercise price of $0.05 per share expiring in five years. The warrants were valued at $11,812 using the Black-Scholes option pricing model to calculate the grant-date fair value of the warrants, with the following assumptions: no dividend yield, expected volatility of 229.0%, risk free interest rate of 1.68% and expected life of five years. The relative fair value of the warrants was $10,563 and was recorded as a discount to the notes payable in accordance with FASB ASC 835-30-25 and is being accreted over the term of the note payable for financial statement purposes. For the three months ended March 31, 2015, the final $10,447 was accreted through interest expense. The note and accrued interest at 8% per annum were due in full on April 1, 2015. The warrants are subject to anti-dilution adjustments and are therefore classified as a liability in accordance with FASB ASC 815. The warrant liability is revalued at each reporting period with the change in fair value recorded through earnings. As of June 12, 2015, the date of conversion in conjunction with the Recapitalization Transaction (see Note 6), the fair value of the warrant liability was $5,226. As a result of the Recapitalization Transaction, the principal balance of $100,000 and accrued interest of $3,689 was converted into 67,637 shares (5,749,163 shares pre Reverse Stock Split at $0.018) of Common Stock. This resulted in a gain of $46,084, which was recorded as a gain on the extinguishment of debt. On February 10, 2015, the Company issued a note payable for $25,000, bearing interest at 5.0% to an accredited investor and director of the Company. As a result of the recapitalization transaction (see Note 6), the principal balance of $25,000 and accrued interest of $417 was converted into 16,608 shares (1,411,720 shares pre Reverse Stock Split at $0.018) of Common Stock. This resulted in a gain of $11,296 and because this entity is a stockholder was recorded as additional paid in capital. The conversion of the notes above on June 12, 2015 will be treated as an extinguishment of debt. In accordance with FASB ASC 470-50, the difference between the cash acquisition price of the debt and its net carrying amount shall be recognized currently in income in the period of extinguishment as losses or gains. Similar transactions between stockholders will be recognized as additional paid in capital. On March 27, 2015, the Company issued a note payable for $111,102, bearing interest at 8.0% to an accredited investor. On April 30, 2015, the Company issued a note payable for $4,887, bearing interest at 8.0% to an accredited investor. On May 15, 2015, the Company issued a note payable for $4,480, bearing interest at 8.0% to an accredited investor. On May 21, 2015, the Company issued a note payable for $14,074, bearing interest at 8.0% to an accredited investor. As a result of the Recapitalization Transaction (see Note 6), the principal balance of the above four notes of $134,542 and accrued interest of $2,271 was converted into 41,603 shares (3,536,254 shares pre Reverse Stock Split at $0.0386) of the Company’s Series A Preferred stock as part of the $1,450,000 cash investment. On June 12, 2015, the conversion of the four notes issued from March 27, 2015 to May 21, 2015, was treated as a troubled debt restructuring in accordance with FASB ASC 470-60-15, “Debt – Troubled Debt Restructurings by Debtors.” A debtor that issues or otherwise grants an equity interest to a creditor to settle fully a payable shall account for the equity interest at its fair value. The difference between the fair value of the equity interest granted and the carrying amount of the payable settled shall be recognized as a gain on restructuring payables. |
Warrant Liability
Warrant Liability | 9 Months Ended |
Sep. 30, 2015 | |
Text Block [Abstract] | |
Warrant Liability | NOTE 9 – WARRANT LIABILITY On December 31, 2012, the Company entered into an Investment Agreement, a Technology and Service Agreement, a Patent and Technology License Agreement and an Asset Purchase Agreement with VFM on the same date entered into a Technology and Service Agreement with Zaah (collectively with the VFM agreements, the “Agreements”). Contemplated by those Agreements were warrant issuances by the Company for the purchase of Common Stock. Warrants exercisable for 627,451 shares (53,333,333 shares pre Reverse Stock Split) of Common Stock associated with these Agreements are subject to anti-dilution adjustments outlined in the Agreements. In accordance with FASB ASC 815, the warrants were classified as a liability in the total amount of $2.4 million at December 31, 2012. In addition, the warrants must be valued every reporting period and adjusted to market with the increase or decrease being adjusted through earnings. As of September 30, 2015 and December 31, 2014, the fair value of the warrant liability was $1,041,091 and $787,544, respectively. On January 1, 2014, the Company issued warrants to purchase 74,697 shares (6,349,245 pre Reverse Stock Split) of Common Stock as consideration for technology received from VFM under to the Patent and Technology License Agreement dated December 31, 2012. The warrants are exercisable at $0.10 per share. The warrants are subject to anti-dilution adjustments outlined in the Agreement. In accordance with FASB ASC 815, the warrants were classified as a liability with an initial fair value of $444,000, which was immediately expensed as research and development costs. In addition, the warrants must be valued every reporting period and adjusted to market with the increase or decrease being adjusted through earnings. As of September 30, 2015 and December 31, 2014, the fair value of the warrant liability was $149,090 and $121,209, respectively. The Company made the payment of warrants to VFM on a good faith basis, based on the assumption that the technology conveyed to the Company would be patentable and licensable. The Company had not reached a conclusion at that time that the technology would be patentable and licensable. As of June 12, 2015, the Company concluded that the technology received from VFM is patentable and licensable, and that the Company was required to make, on January 1, 2015, an additional payment pursuant to Patent and Technology Agreement in the amount of $4,500,000, to be paid by issuing (i) a number of shares of Common Stock equal to (x) $4,500,000 divided by (y) a price which equals a 10% discount to the market price at the time of issuance and (ii) warrants to purchase an equal number of shares of Common Stock exercisable at a price of $0.10 per share. Based upon the share price of $0.04 per share, this would result in the issuance of approximately an additional 125 million shares of Common Stock and warrants to purchase an additional 125 million shares. The $4,500,000 was accrued at December 31, 2014. The number of warrants to be issued based on a stock price of $0.02 at December 31, 2014 was 250 million warrants. The warrants were valued at $4,892,089 using the Black-Scholes pricing model to calculate the grant-date fair value of the warrants with the following assumptions: no dividend yield, expected volatility of 229.1%, risk free interest rate of 1.65% and expected life of five years. In conjunction with the Recapitalization Transaction (see Note 6), the Company agreed that an additional $2,000,000 in exclusivity licensing fees was required to be paid and converted the $6,500,000 into shares of Series B Preferred Stock. In addition, the fair value of the associated warrants was $1,867,417 as of June 12, 2015 and was recorded as additional paid in capital on conversion. The warrants associated with the notes payable (see Note 6) were revalued at June 12, 2015, based on the cashless conversion modification. The total fair value of those warrants was $37,000 and was recorded as additional paid in capital on conversion. |
Convertible Preferred Stock
Convertible Preferred Stock | 9 Months Ended |
Sep. 30, 2015 | |
Equity [Abstract] | |
Convertible Preferred Stock | NOTE 10 – CONVERTIBLE PREFERRED STOCK Subscription Agreement The Company entered into a Subscription Agreement with VFM on January 31, 2013 (the “Subscription Agreement”). Under the terms of the Subscription Agreement, VFM subscribed to purchase 33,333,333 shares of Series A Preferred Stock (pre Reverse Stock Split) and a warrant to purchase 33,333,333 shares (pre Reverse Stock Split) of Common Stock at an exercise price of $0.12 per share, for $1 million. At any time before January 31, 2015, VerifyMe had the right, but not the obligation, to require the Company to repurchase all, but not less than all, of the capital stock of the Company and warrants exercisable for capital stock of the Company held by VerifyMe in exchange for the price originally paid by VerifyMe therefore upon the occurrence of any of the following events: (i) the consummation of any bona fide business acquisition, (ii) the incurrence of any indebtedness by the Company in an amount in excess of $2 million, (iii) the issuance or sale of any security having a preference on liquidation senior to Common Stock, or (iv) the sale by the Company of capital stock or warrants exercisable for its capital stock at a price below $0.03 per share. This right had not been exercised. In accordance with FASB ASC 480 and FASB ASC 815, the Series A Preferred Stock was classified as permanent equity and was valued at $1 million at January 31, 2013. The conversion feature of the Series A Preferred Stock is an embedded derivative, which is classified as a liability in accordance with FASB ASC 815 and was valued in accordance with FASB ASC 470, “Debt,” as a beneficial conversion feature at a fair value of $0 at June 12, 2015 and December 31, 2014. This was classified as an embedded derivative liability and a discount to the Series A Preferred Stock. Because the Series A Preferred Stock can be converted at any time, the full amount of the original fair value was accreted and classified as a reduction to the discount on Series A Preferred Stock and a deemed dividend distribution in the full amount of $1 million, in 2013. On August 5, 2013, 12,222,222 shares (pre Reverse Stock Split) of Series A Preferred Stock were converted into 12,222,222 shares (pre Reverse Stock Split) of Common Stock. The Company has determined that the Series A Preferred Stock issuance in the Recapitalization Transaction does not meet the requirements of FASB ASC 480-10 for liability treatment and therefore has been classified as permanent equity. Additionally, it was determined that the economic characteristics of the beneficial conversion feature are clearly and closely related to the host, and are based on a fixed conversion rate into shares of Common Stock and therefore do not require bifurcation. The Series A Preferred Stock was converted into 248,366 (21,111,111 pre Reverse Stock Split) shares of Common Stock on June 12, 2015 in conjunction with the Recapitalization Transaction (see Note 6). The 392,157 warrants (33,333,333 warrants pre Reverse Stock Split) associated with the Series A Preferred Stock were also classified as a liability since they are subject to anti-dilutive adjustments outlined in the warrant agreement and valued at a fair market value of $2,995,791 at January 31, 2013. In addition, the warrants must be valued every reporting period and adjusted to market with the increase or decrease being adjusted through earnings. As of September 30, 2015 and December 31, 2014, the fair value of the warrants was $631,678 and $494,939. On May 26, 2015, the Company amended its Amended Certificate of Designation, dated February 1, 2013, with respect to its Series A Preferred Stock, to amend the designations, preferences, powers and rights of the Series A Preferred Stock, and authorizing the issuance of up to 37,564,767 shares of Series A Preferred Stock. The Series A Preferred Stock are currently convertible at 20:1. 37,564,767 (pre-Reverse Stock Split) shares of Series A Preferred Stock were issued as part of the Recapitalization Transaction (see Note 6). Additionally, on May 26, 2015, the Company amended its Amended and Restated Articles of Incorporation, dated December 19, 2003, to establish the Series B Preferred Stock, authorizing the issuance of up to 85 shares of Series B Preferred Stock. The Series B Preferred Stock are convertible currently at 8,496,732:1. 85 shares (pre Reverse Stock Split) of Series B Preferred Stock were issued to settle the $6.5 million of licensing fees due and the associated warrants as part of the Recapitalization Transaction (see Note 6). The foregoing description of the Certificate of Designation is a summary, and does not purport to be a complete description of the Certificate of Designation, and is qualified in its entirety by reference to the Certificate of Designation, a copy of which is filed as Exhibit 3.3 to the Company’s Current Report on Form 8-K, filed with the SEC on June 18, 2015. On June 12, 2015, the Company issued 389,668 shares (33,121,777 pre Reverse Stock Split) of Series A Preferred shares to an investor for $1,278,501 as part of the total $1,450,813 transaction with the investor. In addition, an officer of the Company and a stockholder received a total of 10,667 shares (906,736 pre Reverse Stock Split) of Series A Preferred Stock for the forgiveness of previously accrued but unpaid compensation valued at $35,000 and notes payable and accrued interest were converted into 41,603 shares (3,536,254 pre Reverse Stock Split) of Series A Preferred Stock also as part of the $1,450,813 transaction with the investor. As of September 30, 2015, the 10,667 shares (906,736 pre Reverse Stock Split) of Series A Preferred Stock had not been distributed to the officer of the Company and the stockholder. Each of the Series A Preferred Stock and the Series B Preferred Stock have a preference in liquidation that the holders of the Series A Preferred Stock and the Series B Preferred Stock are to be paid out of assets available for distribution prior to holders of Common Stock. The holders Series A Preferred Stock and the Series B Preferred Stock may cast the number of votes equal to the number of whole shares of Common Stock into which the shares of Series A Preferred Stock and the Series B Preferred Stock can be converted. In addition, the holders of Series A Preferred Stock and the Series B Preferred Stock are to be paid dividends, based on the number of shares of Series A Preferred Stock and the Series B Preferred Stock, as the case may be, as if the shares had been converted to Common Stock, prior to the holders of Common Stock receiving a dividend. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | NOTE 11 – FAIR VALUE OF FINANCIAL INSTRUMENTS Derivative Liabilities For purposes of determining whether certain instruments are derivatives for accounting treatment, the Company follows the accounting standard that provides guidance for determining whether an equity-linked financial instrument, or embedded feature, is indexed to an entity’s own stock. The standard applies to any freestanding financial instruments or embedded features that have the characteristics of a derivative, and to any freestanding financial instruments that are potentially settled in an entity’s own common stock. Liabilities measured at fair value on a recurring basis are summarized as follows: Level 1 Level 2 Level 3 Total Derivative liability related to fair value of warrants $ — $ — $ 1,829,757 $ 1,829,757 Total $ — $ — $ 1,829,757 $ 1,829,757 The following table details the approximate fair value measurements within the fair value hierarchy of the Company’s derivative liabilities using Level 3 inputs: Total Balance at January 1, 2015 $ 6,370,709 Conversion of notes payable, net of interest expense (31,397 ) Conversion of warrants related to licensing fees (1,867,417 ) Change in fair value of derivative liabilities (2,642,138 ) Balance at September 30, 2015 $ 1,829,757 The Company has no assets that are measured at fair value on a recurring basis. There were no assets or liabilities measured at fair value on a non-recurring basis during the three months and nine months ended September 30, 2015. As of September 30, 2015, the Company’s outstanding warrants were treated as derivative liabilities and changes in the fair value were recognized in earnings. These Common Stock purchase warrants did not trade in an active securities market, and as such, the Company estimated the fair value of these warrants using Black-Scholes and the following assumptions: September 30, 2015 Annual Dividend Yield 0.0% Expected Life (Years) 2.25 - 3.94 Risk-Free Interest Rate .64% - 1.37% Expected Volatility 170.1% - 174.6% Expected volatility was based primarily on historical volatility. Historical volatility was computed using daily pricing observations for recent periods. The Company believes this method produced an estimate that was representative of the Company’s expectations of future volatility over the expected term of these warrants. The Company had no reason to believe future volatility over the expected remaining life of these warrants was likely to differ materially from historical volatility. The expected life was based on the remaining contractual term of the warrants. The risk-free rate was based on the U.S. Treasury rate that corresponded to the expected term of the warrants. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2015 | |
Equity [Abstract] | |
Stockholders' Equity | NOTE 12 – STOCKHOLDERS’ EQUITY On January 1, 2014, under the terms of the Patent and Technology License Agreement, the Company issued 6,349,206 shares (pre Reverse Stock Split) of Common Stock to VFM, in addition to the warrants described in Note 9 above. The shares were issued in payment for the technology received. Under the agreement, $400,000 worth of Common Stock was to be paid by the Company to VFM at a 10% discount to the market at time of payment. The closing price was $0.07 per share discounted 10% to $0.063. The $400,000 payment divided by the $0.063 per share resulted in 6,349,206 shares (pre Reverse Stock Split) to be issued. The entire $400,000 payment was expensed to research and development. On June 2, 2015, the Company issued 682,353 shares (post Reverse Stock Split) of Common Stock to two vendors to settle outstanding payable balances of $58,000. On June 12, 2015, the Company issued 304,785 shares (25,906,735 pre Reverse Stock Split) of Common Stock and raised $50,000. During the three months ended June 30, 2015, one stockholder received 2,353 shares (post Reverse Stock Split) of Common Stock in a cashless exercise. On June 11, 2015, the Company issued 525,000 Restricted Stock Units (“RSUs”) (44,625,000 pre Reverse Stock Split) to two officers of the Company. The RSUs were valued at the closing stock price of $0.01 on June 11, 2015, at $446,250, fair value. These RSUs are being expensed over the vesting terms. For the three and nine months ended September 30, 2015, the Company expensed $37,188 and $43,386 related to the RSUs. On June 30, 2015, the Company issued 48,761 shares (post Reverse Stock Split) of Common Stock to a vendor to settle an outstanding payable balance of $41,447, net of gain on conversion of $35,153. On July 9, 2015, the Company hired a Chief Operating Officer (“COO”). The COO will receive 225,000 RSUs (19,125,000 pre Reverse Stock Split), vesting over a three-year period, with one-third vesting the first year and one-twelfth vesting ratably on a quarterly basis thereafter. The RSUs were valued at fair value of $918,000 based on the closing stock price of $4.08 on July 9, 2015. For the three and nine months ended September 30, 2015, the Company expensed $76,500 related to the RSUs. On July 23, 2015, the Company completed the Reverse Stock Split of its outstanding Common Stock and Preferred Stock, as further described in Note 1 and Note 6 above. On August 10, 2015, the Company agreed to issue the Chief Financial Officer (“CFO”) 20,000 RSUs vesting over six months and 100,000 RSUs vesting annually over three years. The RSUs were valued at a fair value of $692,400 based on the closing stock price of $5.77 per share on August 10, 2015. For the three and nine months ended September 30, 2015, the Company expensed $70,522 related to the RSUs. On October 7, 2015, the Company agreed to pay $15,000 to a consultant/stockholder as well as an additional $35,000 based on certain milestones being met. Additionally, as of August 1, 2015 the Company agreed to issue the individual 30,000 RSUs valued at $75,000 in quarterly installments on November 1, 2015, February 1, 2016, May 1, 2016 and August 1, 2016, which begin vesting on August 1, 2015. The Company expensed $12,500 for the three and nine months ended September 30, 2015 relative to these RSUs. Further the individual will receive a 2% to 5% commission on company sales while this agreement is in effect. In accordance with FASB ASC 505-50, “Equity – Equity-Based Payments to Non-Employees,” restricted stock with performance conditions should be revalued based on the modification accounting methodology described in FASB ASC 718-20, “Compensation—Stock Compensation—Awards Classified as Equity.” As such the Company has revalued certain restricted stock with a consultant/stockholder and determined that there was a decrease in fair value of $81,000. |
Stock Options
Stock Options | 9 Months Ended |
Sep. 30, 2015 | |
Equity [Abstract] | |
Stock Options | NOTE 13 – STOCK OPTIONS During 1999, the Board adopted, with the approval of the stockholders, a Stock Option Plan. In 2000, the Board superseded that plan and created a new Stock Option Plan (the “2000 Plan”), pursuant to which it is authorized to grant options to purchase up to 1.5 million shares of Common Stock. On December 17, 2003, the Board, with approval of the stockholders, superseded the 2000 Plan and created the 2003 Stock Option Plan (the “2003 Plan”). Under the 2003 Plan the Company is authorized to grant options to purchase up to 18,000,000 shares of Common Stock to the Company’s employees, officers, directors, consultants, and other agents and advisors. The 2003 Plan is intended to permit stock options granted to employees under the 2003 Plan to qualify as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (“Incentive Stock Options”). All options granted under the 2003 Plan, which are not intended to qualify as Incentive Stock Options, are deemed to be non-qualified options (“Non-Statutory Stock Options”). During 2013, the Board adopted a new omnibus incentive compensation plan (the “2013 Plan,” and together with the 2000 Plan and the 2003 Plan, the “Plans.”) which serves as the successor incentive compensation plan to the 2003 Plan, and provides the Company with a comprehensive plan to design and structure grants of stock options, stock units, stock awards, stock appreciation rights and other stock-based awards for the Company’s employees, non-employee directors and certain consultants and advisors. As of September 30, 2015, there are 2,397,953 options (post Reverse Stock Split) that have been issued under the Plans, and 36,027,929 options that are available to be issued under the Plans. There are an additional 425,882 options that are have been issued that are not included in the Plans. The 2013 Plan is administered by a committee of the Board (“Stock Option Committee”) which determines the persons to whom awards will be granted, the number of awards to be granted and the specific terms of each grant, including the vesting thereof, subject to the provisions of the plan. In connection with Incentive Stock Options, the exercise price of each option may not be less than 100% of the fair market value of the Common Stock on the date of the grant (or 110% of the fair market value in the case of a grantee holding more than 10% of the outstanding stock of the Company). The aggregate fair market value (determined at the time of the grant) of stock for which an employee may exercise Incentive Stock Options under all plans of the company shall not exceed $1,000,000 per calendar year. If any employee shall have the right to exercise any options in excess of $100,000 during any calendar year, the options in excess of $100,000 shall be deemed to be Non-Statutory Stock Options, including prices, duration, transferability and limitations on exercise. The Company issued Non-Statutory Stock Options pursuant to contractual agreements with non-employees. Options granted under the agreements are expensed when the related service or product is provided. Determining the appropriate fair value of stock-based awards requires the input of subjective assumptions. The Company uses the Black-Scholes option pricing model to value its stock option awards. The assumptions used in calculating the fair value represent management’s best estimates and involve inherent uncertainties and judgments. On June 11, 2015, the Company issued options to purchase an aggregate of 1,225,000 shares (104,125,000 pre Reverse Stock Split) of the Common Stock at an exercise price of $0.85 per share, with a term of five years, to three employees and two members of the Board. The fair value of options issued was $993,083. These options were valued using the Black-Scholes option pricing model to calculate the grant-date fair value of the options, with the following assumptions: no dividend yield, expected volatility of 176.6%, risk-free interest rate of 1.74% to 1.75% and expected option life of five years. The options are being expensed over the vesting terms for the employees and over the Board members’ remaining service terms as that is shorter than the vesting terms. On July 9, 2015, the Company hired a COO who received 375,000 options (31,875,000 pre Reverse Stock Split) to purchase shares of Common Stock of the Company, with an exercise price of $0.85 ($0.01 pre reverse split) and valued at $1,502,219. The options vest quarterly over three years. The fair value of the options was valued using the Black-Scholes option pricing model with the following assumptions: no dividend yield, expected volatility of 180.1%, risk free interest rate of 1.58% and expected life of five years. The options are being expensed over the vesting terms. On August 10, 2015, the Company hired a CFO who received 200,000 options (17,000,000 pre Reverse Stock Split) to purchase shares of Common Stock vesting annually over three years. The options were valued at fair value of $1,107,857, using the Black-Scholes option pricing model with the following assumptions: no dividend yield, expected volatility of 182.2%, risk free rate interest rate of 1.62% and expected life of five years. The options are being expensed over the vesting terms. On September 25, 2015, the Company issued options to purchase an aggregate of 75,000 shares (6,375,000 pre Reverse Stock Split) of Common Stock at an exercise price of $2.15 per share, with a term of five years to a member of the Board. The fair value of options issued was $155,003. These options were valued using the Black-Scholes option pricing model to calculate the grant-date fair value of the options, with the following assumptions: no dividend yield, expected volatility of 183.5%, risk-free interest rate of 1.48% and expected option life of five years. The options are being expensed over the service term as that is shorter than the vesting terms. For the three and nine months ended September 30, 2015 the Company expensed $314,960 and $349,055 with respect to the options. The following tables summarize non-employee stock option/warrant activity of the Company since December 31, 2014: Option/Warrant Exercise Weighted Average Outstanding, December 31, 2014 1,425,481 $0.85 to $17.00 $ 8.50 Granted — — — Exercised (45,882 ) 0.85 - 4.25 — Expired — — — Outstanding, September 30, 2015 1,379,599 $0.85 to $12.75 $ 9.11 Exercisable, September 30, 2015 1,379,599 $0.85 to $12.75 $ 9.11 Weighted Average Remaining Life, Exercisable, September 30, 2015 (years) 5.0 A summary of incentive stock option transactions for employees since December 31, 2014 is as follows: Option/Warrant Exercise Weighted Average Outstanding, December 31, 2014 633,725 $4.25 - $12.75 $ 4.25 Granted 1,875,000 0.85 - 5.95 1.25 Exercised — — — Expired/Returned (308,235 ) 4.25 - 12.75 — Outstanding, September 30, 2015 2,200,490 $0.85 to $12.75 $ 1.97 Exercisable, September 30, 2015 506,740 $0.85 to $12.75 $ 3.62 Weighted Average Remaining Life, Exercisable, September 30, 2015 (years) 7.1 |
Operating Leases
Operating Leases | 9 Months Ended |
Sep. 30, 2015 | |
Leases [Abstract] | |
Operating Leases | NOTE 14 – OPERATING LEASES For the three and nine months ended September 30, 2015, total rent expense under leases amounted to $23,463 and $55,474. For the three and nine months ended September 30, 2014, total rent expense under leases amounted to $24,459 and $59,952. As of September 30, 2015, the Company was obligated under various non-cancelable operating lease arrangements for property as follows: 2015 18,963 2016 31,605 $ 50,568 |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2015 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 15 – RELATED PARTY TRANSACTIONS At June 12, 2015, three stockholders of the Company held $317,000 of the senior secured convertible notes payable and were owed accrued interest of $42,713. The notes and accrued interest were converted into 234,735 shares (19,952,489 pre Reverse Stock Split) of Common Stock as further described in Note 7 and 8. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2015 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 16 – SUBSEQUENT EVENTS On October 1, 2015, the Company agreed to issue 100,000 RSUs to a consultant for services. Of the 100,000 RSUs, 60,000 were issued upon execution of the agreement, 20,000 shares are to be issued on January 1, 2016 and 20,000 shares are to be issued on April 1, 2016. As of the date of this filing, the 10,667 shares (906,736 pre Reverse Stock Split) of Series A Preferred Stock have not been distributed to the officer of the Company and the stockholder, as further discussed in Note 10. |
Summary of Significant Accoun25
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Nature of the Business | Nature of the Business On July 14, 2015, LaserLock Technologies, Inc. changed its name to VerifyMe, Inc., effective July 23, 2015. As used in this report, unless the context otherwise indicates, any reference to “VerifyMe,” “our company,” “the company,” “us,” “we” and “our” refers to VerifyMe, Inc. a Nevada corporation. The Company was incorporated in the State of Nevada on November 10, 1999. The Company is based in New York, New York and its common stock, par value $0.001 per share (the “Common Stock”), is traded on the over-the-counter market and quoted on the OTCQX, organized by the OTC Markets Group, Inc., and the OTC Bulletin Board under the ticker symbol “VRME.” A high-tech solutions company in the field of authenticating people and products, the Company offers state-of-the-art solutions to combat identity fraud and counterfeiting utilizing multi-factor authentication and a suite of security pigments for governments, health care providers, the gaming industry, the financial services industry and high-end retailers. The Company invests in developing new proprietary color shifting inks that it believes will allow it to penetrate broader markets and result in increased revenues. The Company refines its technologies and their applications, and now has what it believes to be one of the most cost effective and efficient authentication technologies available. Its most recent technology takes advantage of the new ubiquitous energy efficient fluorescent lighting to change the color of ink, resulting in numerous potential new applications ranging from credit cards to drivers licenses, passports, stock certificates, clothing labels, currency, ID cards, and tax stamps. The technologies can also be used to protect DVDs, apparel, pharmaceuticals, and virtually any other physical product. The Company’s digital solution is a multi-platform (iOS and Android) strong authentication solution that integrates biometrics and geo-location tagging. The solution completely eliminates passwords and the inherently weak security they provide. The solution also removes the user complexity associated with having to manage many complex passwords. The solution can be delivered either as a high availability cloud service, managed by the Company, or as a licensed software product for operation on the client’s premises. The solution integrates three independent authentication factors – something you have (for instance a smartphone), something you know (for instance a color gesture swipe) and something you are (for instance your facial geometry) into a simple, fast, intuitive solution. The system can also accurately determine the precise location of the individual using a variety of mechanisms including GPS, cell tower triangulation, IP or Wi-Fi address. Because the solution incorporates biometrics it completely eliminates the possibility that users might share their authentication credentials. The combination of biometrics and geolocation provides extremely strong transactional evidence, making it nearly impossible for an end-user to refute having been part of a transaction. The Company’s activities are subject to significant risks and uncertainties, including the need to secure additional funding to operationalize the Company’s current technology. |
Basis of Presentation | Basis of Presentation The accompanying unaudited financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information and with the instructions for Form 10-Q and Rule 8-03 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. The accompanying unaudited financial statements should be read in conjunction with the financial statements and notes included in the Company’s Annual Report on form 10-K for the year ended December 31, 2014 as filed with the SEC. Operating results for the three and nine months ended September 30, 2015 are not necessarily indicative of the results that may be expected for the year ending December 31, 2015. |
Reverse Stock Split and Changes to Company's Preferred Stock | Reverse Stock Split and Changes to Company’s Preferred Stock On May 26, 2015, the board of directors of the Company (the “Board”), acting by written consent in lieu of a special meeting, unanimously approved and adopted: (a) a reverse stock split of all of the Company’s issued and outstanding capital stock based on a minimum 1-for-40 split, up to a maximum 1-for-100 split (the “Reverse Stock Split”), and recommended the same for the Company’s stockholders for approval, and (b) a Second Amended Certificate of Designation for Series A Preferred Stock, which amended the designations, preferences, powers and rights of the shares of the Company’s Series A convertible preferred stock, par value $0.001 per share (the “Series A Preferred Stock”), which were originally set forth in that certain Amended Certificate of Designation for Series A Preferred Stock, dated December 19, 2003. On May 28, 2015, those stockholders of the Company holding a majority of the issued and outstanding shares of Common Stock and Series A Preferred Stock, acting by written consent in lieu of a special meeting, voted to approve the Reverse Stock Split. On June 11, 2015, at a duly authorized special meeting of the Board, the Board (a) finalized, adopted and approved a resolution setting the Reverse Stock Split exchange ratio to a 1-for-85 split and (b) approved and adopted a new Certificate of Designation for Series B Preferred Stock, establishing the designations, preferences, powers and rights of the shares of the Company’s Series B convertible preferred stock, par value $0.001 per share (the “Series B Preferred Stock,” and together with the Series A Preferred Stock, the “Preferred Stock”). On July 23, 2015, the Company completed the 1-for-85 Reverse Stock Split of all of its outstanding Common Stock and Preferred Stock. The total number of authorized capital stock of the Company remained unchanged at its current total of 750,000,000, with 675,000,000 designated as Common Stock and 75,000,000 designated as Preferred Stock. The accompanying financial statements and notes to the financial statements give retroactive effect to the Reverse Stock Split for all periods presented, unless otherwise specified. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. |
Comprehensive Income | Comprehensive Income The Company follows Financial Accounting Standards Board Accounting Standards Codification (“FASB ASC”) 220, “Comprehensive Income,” in reporting comprehensive income. Comprehensive income is a more inclusive financial reporting methodology that includes disclosure of certain financial information that historically has not been recognized in the calculation of net income. Since the Company has no items of other comprehensive income (loss), comprehensive income (loss) is equal to net income (loss). |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company’s financial instruments consist of accounts receivable, accounts payable and accrued expenses, warrant liability and notes payable. The carrying value of accounts receivable, accounts payable and accrued expenses approximate their fair value because of their short maturities. The Company follows FASB ASC 820, “Fair Value Measurements and Disclosures,” and applies it to all assets and liabilities that are being measured and reported on a fair value basis. The statement requires that assets and liabilities carried at fair value will be classified and disclosed in one of the following three categories: Level 1: Quoted market prices in active markets for identical assets or liabilities Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data Level 3: Unobservable inputs that are not corroborated by market data The level in the fair value within which a fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. |
Cash and Cash Equivalents | Cash and Cash Equivalents For purposes of reporting cash flows, the Company considers all cash accounts, which are not subject to withdrawal restrictions or penalties, and certificates of deposit and commercial paper with original maturities of 90 days or less to be cash or cash equivalents. |
Concentration of Credit Risk Involving Cash and Cash Equivalents | Concentration of Credit Risk Involving Cash and Cash Equivalents The Company’s cash and cash equivalents are held at one financial institution. At times, the Company’s deposits may exceed Federal Deposit Insurance Corporation (FDIC) coverage limits. The Company has not experienced any losses from maintaining cash accounts in excess of federally insured limits. |
Inventory | Inventory Inventory principally consists of penlights and pigments and is stated at the lower of cost (determined by the first-in, first-out method) or market. |
Property and Equipment | Property and Equipment Property and equipment is stated at cost. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, principally five to seven years. Maintenance and repairs of property are charged to operations, and major improvements are capitalized. Upon retirement, sale, or other disposition of property and equipment, the costs and accumulated depreciation are eliminated from the accounts, and any resulting gain or loss is included in operation |
Patents and Trademark | Patents and Trademark Currently the Company has twenty U.S. patents, four U.S. and seven applications pending for allowance. The Company has also purchased a trademark. Costs associated with the registration and legal defense of the patents have been capitalized and are amortized on a straight-line basis over the estimated lives of the patents which were determined to be 17 to 20 years. |
Long-Lived Assets | Long-Lived Assets The Company evaluates the recoverability of its long-lived assets in accordance with FASB ASC 360, “Property, Plant, and Equipment.” The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of long-lived assets are measured by a comparison of the carrying amount of an asset to future cash flows expected to be generated by the asset, undiscounted and without interest or independent appraisals. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset exceeds the fair value of the assets. |
Deferred Financing Costs | Deferred Financing Costs Costs incurred in securing long-term debt are deferred and amortized, as a charge to interest expense, over the term of the related debt. In the case of long-term debt modifications, the Company follows the guidance provided by FASB ASC 470-50, “Debt – Modification and Extinguishments” (“FASB ASC 470-50”). |
Convertible Notes Payable | Convertible Notes Payable Convertible notes payable, for which the embedded conversion feature does not qualify for derivative treatment, are evaluated to determine if the effective or actual rate of conversion per the terms of the convertible note agreement is below market value. In these instances, the Company accounts for the value of the beneficial conversion feature (BCF) as a debt discount, which is then accreted to interest expense over the life of the related debt using the straight-line method which approximates the effective interest method. |
Derivative Instruments | Derivative Instruments The Company evaluates its convertible debt, Preferred Stock, warrants or other contracts to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with FASB ASC 480, “Distinguish by Liabilities from Equity” (FASB ASC 480), and FASB ASC 815, “Derivatives and Hedging” (“FASB ASC 815”). The result of this accounting treatment is that the fair value of the embedded derivative, if required to be bifurcated, is marked-to-market at each balance sheet date and recorded as a liability. The change in fair value is recorded in the Statement of Operations as a component of other income or expense. Upon conversion or exercise of a derivative instrument, the instrument is marked to fair value at the conversion date and then that fair value is reclassified to equity. In circumstances where the embedded conversion option in a convertible instrument is required to be bifurcated and there are also other embedded derivative instruments in the convertible instrument that are required to be bifurcated, the bifurcated derivative instruments are accounted for as a single, compound derivative instrument. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. Equity instruments that are initially classified as equity that become subject to reclassification are reclassified as liabilities at the fair value of the instrument on the reclassification date. Derivative instrument liabilities will be classified in the balance sheet as current or non-current based on whether net-cash settlement of the derivative instrument is expected within 12 months of the balance sheet date. |
Revenue Recognition | Revenue Recognition In accordance with FASB ASC 605, “Revenue Recognition,” the Company recognizes revenue when (i) persuasive evidence of a customer or distributor arrangement exists, (ii) a retailer, distributor or wholesaler receives the goods and acceptance occurs, (iii) the price is fixed or determinable, and (iv) collectability of the revenue is reasonably assured. Subject to these criteria, the Company recognizes revenue from product sales, consisting mainly of pigments and penlights, upon shipment to the customer. Royalty revenue is recognized upon receipt of notification from a customer that the Company’s product has been used in the customer’s production process. |
Income Taxes | Income Taxes The Company follows FASB ASC 740, “Income Taxes,” when accounting for income taxes, which requires an asset and liability approach to financial accounting and reporting for income taxes. Deferred income tax assets and liabilities are computed annually for temporary differences between the financial statements and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Income tax expense is the tax payable or refundable for the period plus or minus the change during the period in deferred tax assets and liabilities. Tax years from 2011 through 2014 remain subject to examination by major tax jurisdictions. |
Stock-based Payments | Stock-based Payments The Company accounts for stock-based compensation under the provisions of FASB ASC 718, “Compensation—Stock Compensation”, which requires the measurement and recognition of compensation expense for all stock-based awards made to employees and directors based on estimated fair values on the grant date. The Company estimates the fair value of stock-based awards on the date of grant using the Black-Scholes model. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods using the straight-line method. The Company accounts for stock-based compensation awards to non-employees in accordance with FASB ASC 505-50, “Equity-Based Payments to Non-Employees” (“FASB ASC 505-50”). Under FASB ASC 505-50, the Company determines the fair value of the warrants or stock-based compensation awards granted as either the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. All issuances of stock options or other equity instruments to non-employees as consideration for goods or services received by the Company are accounted for based on the fair value of the equity instruments issued. Non-employee equity based payments are recorded as an expense over the service period, as if the Company had paid cash for the services. At the end of each financial reporting period, prior to vesting or prior to the completion of the services, the fair value of the equity based payments will be re-measured and the non-cash expense recognized during the period will be adjusted accordingly. Since the fair value of equity based payments granted to non-employees is subject to change in the future, the amount of the future expense will include fair value re-measurements until the equity based payments are fully vested or the service completed. |
Advertising Costs | Advertising Costs Advertising costs are expensed as incurred. Advertising costs were approximately $200 and $458 for the three and nine months ended September 30, 2015 and $9,000 and $62,238 for the three and nine months ended September 30, 2014 and are included in sales and marketing expenses. |
Research and Development Costs | Research and Development Costs In accordance with FASB ASC 730, “Research and Development,” research and development costs are expensed when incurred. Research and development costs were $58,062 and $2,194,448 for the three and nine months ended September 30, 2015 and $13,601 and $889,450 for the three and nine months ended September 30, 2014. |
Basic and Diluted Net Income per Share of Common Stock | Basic and Diluted Net Income per Share of Common Stock The Company follows FASB ASC 260, “Earnings Per Share,” when reporting Earnings Per Share resulting in the presentation of basic and diluted earnings per share. Basic net income per common share is based on the weighted average number of shares outstanding during the periods presented. Diluted net income per common share is computed using the weighted average number of common shares plus dilutive common share equivalents outstanding during the period. Potential common shares that would have the effect of increasing diluted earnings per share are considered to be anti-dilutive, i.e., the exercise prices of the outstanding stock options were greater than the market price of the Common Stock. Anti-dilutive Common Stock equivalents, which were excluded from the calculation of number of dilutive common stock equivalents, amounted to 19,237,648 shares for the three months ended September 30, 2015. |
Segment Information | Segment Information The Company is organized and operates as one operating segment wherein the Company’s patented technologies are utilized to address counterfeiting issues. In accordance with FASB ASC 280, “Segment Reporting” (“FASB ASC 280”), the chief operating decision-maker has been identified as the Chief Executive Officer, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company. Since the Company operates in one segment and provides one group of similar products, all financial segment and product line information required by FASB ASC 280 can be found in the financial statements. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements As of September 30, 2015 and for the three and nine months then ended, there were no recently adopted accounting pronouncements that had a material effect on the Company’s financial statements. |
Recently Issued Accounting Pronouncements Not Yet Adopted | Recently Issued Accounting Pronouncements Not Yet Adopted As of September 30, 2015, there are no recently issued accounting standards not yet adopted which would have a material effect on the Company’s financial statements through 2017. |
Reclassifications | Reclassifications Certain amounts in the 2014 statement of operations have been reclassified in order for them to conform with the 2015 presentation. |
Property and Equipment (Tables)
Property and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment consists of the following: September 30, December 31, Furniture and Fixtures $ 219,871 $ 219,871 Equipment 18,587 16,155 238,458 236,026 Less: Accumulated depreciation 213,226 161,205 $ 25,232 $ 74,821 |
Notes Payable (Tables)
Notes Payable (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Debt Disclosure [Abstract] | |
Schedule of Notes Payable | Notes payable consists of the following at September 30, 2015 and December 31, 2014: September 30, December 31, Unsecured notes payable due to related parties; interest at 10% per annum; principal and accrued interest due at maturity in September 2015 — $ 114,000 Series A notes payable; interest at 8% per annum; principal and accrued interest due at maturity in October 2011 (past due) 50,000 50,000 Notes payable; interest at 8% per annum, principal and accrued interest due at December 1, 2014 (past due) — 650,000 Notes payable; interest at 5% and 8% per annum, principal and accrued interest due at April 2015 — 123,000 Notes payable; interest at 5% per annum, principal and accrued interest due at June 10, 2015 — — Notes payable; interest at 8% per annum, principal and accrued interest due at June 25, 2015 — — Less: Debt discount — (10,447 ) 50,000 926,553 Less: Current portion 50,000 926,553 $ — $ — |
Fair Value of Financial Instr28
Fair Value of Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Schedule of Liabilities Measured at Fair Value on a Recurring Basis | Liabilities measured at fair value on a recurring basis are summarized as follows: Level 1 Level 2 Level 3 Total Derivative liability related to fair value of warrants $ — $ — $ 1,829,757 $ 1,829,757 Total $ — $ — $ 1,829,757 $ 1,829,757 |
Fair Value Measurements within Fair Value Hierarchy of Derivative Liabilities Using Level 3 Inputs | The following table details the approximate fair value measurements within the fair value hierarchy of the Company’s derivative liabilities using Level 3 inputs: Total Balance at January 1, 2015 $ 6,370,709 Conversion of notes payable, net of interest expense (31,397 ) Conversion of warrants related to licensing fees (1,867,417 ) Change in fair value of derivative liabilities (2,642,138 ) Balance at September 30, 2015 $ 1,829,757 |
Schedule of Common Stock Purchase Warrants Valuation Assumptions | As of September 30, 2015, the Company’s outstanding warrants were treated as derivative liabilities and changes in the fair value were recognized in earnings. These Common Stock purchase warrants did not trade in an active securities market, and as such, the Company estimated the fair value of these warrants using Black-Scholes and the following assumptions: September 30, 2015 Annual Dividend Yield 0.0% Expected Life (Years) 2.25 - 3.94 Risk-Free Interest Rate .64% - 1.37% Expected Volatility 170.1% - 174.6% |
Stock Options (Tables)
Stock Options (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Equity [Abstract] | |
Schedule of Incentive Stock Option Transactions for Employees | The following tables summarize non-employee stock option/warrant activity of the Company since December 31, 2014: Option/Warrant Exercise Weighted Average Outstanding, December 31, 2014 1,425,481 $0.85 to $17.00 $ 8.50 Granted — — — Exercised (45,882 ) 0.85 - 4.25 — Expired — — — Outstanding, September 30, 2015 1,379,599 $0.85 to $12.75 $ 9.11 Exercisable, September 30, 2015 1,379,599 $0.85 to $12.75 $ 9.11 Weighted Average Remaining Life, Exercisable, September 30, 2015 (years) 5.0 |
Schedule of Non-employee Stock Option/Warrant Activity | A summary of incentive stock option transactions for employees since December 31, 2014 is as follows: Option/Warrant Exercise Weighted Average Outstanding, December 31, 2014 633,725 $4.25 - $12.75 $ 4.25 Granted 1,875,000 0.85 - 5.95 1.25 Exercised — — — Expired/Returned (308,235 ) 4.25 - 12.75 — Outstanding, September 30, 2015 2,200,490 $0.85 to $12.75 $ 1.97 Exercisable, September 30, 2015 506,740 $0.85 to $12.75 $ 3.62 Weighted Average Remaining Life, Exercisable, September 30, 2015 (years) 7.1 |
Operating Leases (Tables)
Operating Leases (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Leases [Abstract] | |
Schedule of Non-cancelable Operating Lease Arrangements for Property | As of September 30, 2015, the Company was obligated under various non-cancelable operating lease arrangements for property as follows: 2015 18,963 2016 31,605 $ 50,568 |
Summary of Significant Accoun31
Summary of Significant Accounting Policies - Additional Information (Detail) | 3 Months Ended | 9 Months Ended | |||||||
Sep. 30, 2015USD ($)Patents$ / sharesshares | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($)PatentsSegmentInstitution$ / sharesshares | Sep. 30, 2014USD ($) | Jul. 23, 2015shares | Jun. 11, 2015$ / shares | May. 26, 2015$ / shares | Dec. 31, 2014$ / sharesshares | ||
Schedule Of Significant Accounting Policies [Line Items] | |||||||||
Common stock, par value | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | ||||||
Reverse stock split ratio | 85 | ||||||||
Common stock, shares authorized | 675,000,000 | 675,000,000 | 675,000,000 | 675,000,000 | |||||
Preferred stock, shares authorized | 75,000,000 | ||||||||
Capital stock, shares authorized | 750,000,000 | ||||||||
Number of financial institutions at which company's cash and cash equivalents are held | Institution | 1 | ||||||||
Depreciation method of property and equipment | Straight-line method | ||||||||
Research and development costs | $ | [1] | $ 58,415 | $ 106,674 | $ 2,194,801 | $ 1,055,290 | ||||
Anti-dilutive common stock equivalents, excluded from the calculation of earnings per share | 19,237,648 | ||||||||
Number of operating segment | Segment | 1 | ||||||||
Patents and Trademark | |||||||||
Schedule Of Significant Accounting Policies [Line Items] | |||||||||
Number of patents issued | Patents | 20 | 20 | |||||||
Number of provisional patents pending for allowance. | Patents | 7 | ||||||||
Amortization method of patents | Straight-line basis | ||||||||
Patents and Trademark | UNITED STATES | |||||||||
Schedule Of Significant Accounting Policies [Line Items] | |||||||||
Number of provisional patents pending for allowance. | Patents | 4 | ||||||||
Sales and Marketing Expenses | |||||||||
Schedule Of Significant Accounting Policies [Line Items] | |||||||||
Advertising costs | $ | $ 200 | $ 9,000 | $ 458 | $ 62,238 | |||||
Series A Convertible Preferred Stock | |||||||||
Schedule Of Significant Accounting Policies [Line Items] | |||||||||
Preferred stock, par value | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | |||||
Preferred stock, shares authorized | 37,564,767 | 37,564,767 | 75,000,000 | ||||||
Series B Convertible Preferred Stock | |||||||||
Schedule Of Significant Accounting Policies [Line Items] | |||||||||
Preferred stock, par value | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | |||||
Preferred stock, shares authorized | 85 | 85 | 0 | ||||||
Minimum | |||||||||
Schedule Of Significant Accounting Policies [Line Items] | |||||||||
Reverse stock split ratio | 40 | ||||||||
Estimated useful lives of property and equipment | 5 years | ||||||||
Minimum | Patents and Trademark | |||||||||
Schedule Of Significant Accounting Policies [Line Items] | |||||||||
Estimated lives of patents | 17 years | ||||||||
Maximum | |||||||||
Schedule Of Significant Accounting Policies [Line Items] | |||||||||
Reverse stock split ratio | 100 | ||||||||
Estimated useful lives of property and equipment | 7 years | ||||||||
Maximum | Patents and Trademark | |||||||||
Schedule Of Significant Accounting Policies [Line Items] | |||||||||
Estimated lives of patents | 20 years | ||||||||
[1] | Includes share based compensation of $0 and $2,000,000 for the three and nine months ended September 30, 2015, and $0 and $400,000 for the three and nine months ended September 30, 2014, related to licensing agreements. |
Property and Equipment - Proper
Property and Equipment - Property and Equipment (Detail) - USD ($) | Sep. 30, 2015 | Dec. 31, 2014 |
Property, Plant and Equipment, Net [Abstract] | ||
Furniture and Fixtures | $ 219,871 | $ 219,871 |
Equipment | 18,587 | 16,155 |
Property, Plant and Equipment, Gross, Total | 238,458 | 236,026 |
Less: Accumulated depreciation | 213,226 | 161,205 |
Property, Plant and Equipment, Net, Total | $ 25,232 | $ 74,821 |
Plant and Equipment - Additiona
Plant and Equipment - Additional Information (Detail) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Property, Plant and Equipment, Net [Abstract] | ||||
Depreciation of property and equipment | $ 17,394 | $ 17,313 | $ 52,021 | $ 51,940 |
Patents and Trademark - Additio
Patents and Trademark - Additional Information (Detail) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015USD ($)Patents | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($)Patents | Sep. 30, 2014USD ($) | |
Patents and Trademark | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization method | Straight-line basis | |||
Capitalized patent costs and trademarks | $ | $ 0 | $ 0 | $ 0 | $ 0 |
Amortization expense | $ | $ 4,203 | $ 3,277 | $ 12,608 | $ 9,831 |
Patents and Trademark | Minimum | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Estimated lives of intangible assets | 17 years | |||
Patents and Trademark | Maximum | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Estimated lives of intangible assets | 20 years | |||
Patents | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Number of patents | 20 | 20 | ||
Number of pending applications for patents | 4 | 4 | ||
Amortization method | Straight-line basis | |||
Patents | Foreign [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Number of pending applications for patents | 7 | 7 | ||
Patents | Minimum | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Estimated lives of intangible assets | 17 years | |||
Patents | Maximum | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Estimated lives of intangible assets | 20 years | |||
Trademark [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Estimated lives of intangible assets | 20 years | |||
Amortization method | Straight-line basis |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||||
Income Tax Expense (Benefit) | $ 0 | $ 0 | $ 0 | $ 0 | |
Unrecognized tax benefits | $ 0 | ||||
Interest or penalties related to unrecognized tax benefits | $ 0 | ||||
Change in unrecognized tax benefits | 0 | 0 | |||
Accrual for uncertain tax positions | $ 0 | $ 0 |
Recapitalization Transaction -
Recapitalization Transaction - Additional Information (Detail) | Jun. 12, 2015USD ($)shares | Sep. 30, 2015USD ($)$ / sharesshares | Jul. 23, 2015shares | Dec. 31, 2014shares | Aug. 05, 2013shares |
Restructuring Cost and Reserve [Line Items] | |||||
Preferred stock, shares authorized | 75,000,000 | ||||
Cash investment of OPC | $ | $ 1,278,501 | ||||
Conversion of deferred compensation, notes payable and accrued interest into Series A Convertible Preferred Stock | $ | $ 136,813 | ||||
Common stock, shares issued | 304,785 | 6,259,727 | 3,969,106 | ||
Cash investment of private investor | $ | $ 50,000 | $ 50,000 | |||
OPC Partners LLC | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Cash investment of OPC | $ | $ 1,450,000 | ||||
Private Investor | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Cash investment of private investor | $ | $ 50,000 | ||||
Series B Convertible Preferred Stock | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Preferred stock, shares authorized | 85 | 0 | |||
Preferred stock, shares issued | 1 | 0 | |||
Series A Convertible Preferred Stock | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Preferred stock, shares authorized | 37,564,767 | 75,000,000 | |||
Preferred stock, shares issued | 441,938 | 248,366 | |||
Series A Convertible Preferred Stock | OPC Partners LLC | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Cash investment of OPC | $ | $ 1,278,501 | ||||
Conversion of deferred compensation, notes payable and accrued interest into Series A Convertible Preferred Stock | $ | $ 171,813 | ||||
Pre Reverse Stock Split | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Outstanding common stock warrant | 3,700,000 | ||||
Common stock shares issued on conversion of warrant | 3,700,000 | ||||
Current conversion rate | 1 | ||||
Shares of common stock shares issued on conversion | 21,111,111 | 21,111,111 | 12,222,222 | ||
Common stock, shares issued | 25,906,735 | ||||
Pre Reverse Stock Split | Private Investor | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Common stock, shares issued | 25,906,736 | ||||
Pre Reverse Stock Split | Series B Convertible Preferred Stock | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Preferred stock, shares issued | 85 | ||||
Pre Reverse Stock Split | Series A Convertible Preferred Stock | OPC Partners LLC | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Preferred stock, shares authorized | 37,564,767 | ||||
Patent and Technology License Termination Agreement | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Additional payment for patent and technology | $ | $ 4,500,000 | ||||
Payments under license | $ | $ 2,000,000 | ||||
Patent and Technology License Termination Agreement | Series B Convertible Preferred Stock | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Preferred stock, shares authorized | 85 | ||||
Convertible Note | Pre Reverse Stock Split | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Amount of outstanding notes converted in to common stock shares | $ | $ 731,426 | ||||
Common stock shares issued on conversion of debt (in shares) | 57,265,030 | ||||
Net gain on conversion of notes | $ | $ 297,370 | ||||
Pre reverse split share price | $ / shares | $ 0.018 |
Senior Secured Convertible No37
Senior Secured Convertible Notes Payable -Related Parties - Additional Information (Detail) - USD ($) | Jun. 12, 2015 | Sep. 30, 2015 | Jun. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 |
Debt Instrument [Line Items] | |||||
Gain (loss) on extinguishment of debt | $ (19,395) | $ 332,523 | $ (82,000) | ||
Accrued interest | $ 42,713 | ||||
10% Senior Secured Convertible Promissory Notes | |||||
Debt Instrument [Line Items] | |||||
Amount of notes converted into common stock shares | $ 216,249 | ||||
Accrued interest of notes converted into common stock shares | $ 208,339 | ||||
Common stock shares issued on conversion of debt (in shares) | 154,184 | 8,448,519 | |||
Gain (loss) on extinguishment of debt | $ 85,489 | $ (82,000) | |||
Outstanding principal balance on notes | 114,000 | ||||
Accrued interest | $ 118,775 | ||||
Pre reverse split shares issued on conversion of debt (in shares) | 13,105,662 | ||||
Pre reverse stock split common stock share price | $ 0.018 | ||||
Total gain on conversion of notes | $ 103,456 | ||||
Gain on conversion of notes recorded as additional paid in capital | $ 17,967 |
Notes Payable - Schedule of Not
Notes Payable - Schedule of Notes Payable (Detail) - USD ($) | Sep. 30, 2015 | Dec. 31, 2014 |
Debt Instrument [Line Items] | ||
Less: Debt discount | $ (10,447) | |
Notes payable | $ 50,000 | 926,553 |
Notes payable | 50,000 | 926,553 |
Less: Current portion | 50,000 | 812,553 |
Long-term portion | 0 | 0 |
Adjustment | ||
Debt Instrument [Line Items] | ||
Less: Current portion | 50,000 | 926,553 |
Unsecured notes payable due to related parties; interest at 10% per annum; principal and accrued interest due at maturity in September 2015 | ||
Debt Instrument [Line Items] | ||
Notes payable | 114,000 | |
Notes payable | 114,000 | |
Series A notes payable; interest at 8% per annum; principal and accrued interest due at maturity in October 2011 (past due) | ||
Debt Instrument [Line Items] | ||
Notes payable | 50,000 | 50,000 |
Notes payable | $ 50,000 | 50,000 |
Notes payable; interest at 8% per annum; principal and accrued interest due at December 1, 2014 (past due) | ||
Debt Instrument [Line Items] | ||
Notes payable | 650,000 | |
Notes payable | 650,000 | |
Notes payable, interest at 5% and 8% per annum; principal and interest due April 2015 | ||
Debt Instrument [Line Items] | ||
Notes payable | 123,000 | |
Notes payable | $ 123,000 |
Notes Payable - Schedule of N39
Notes Payable - Schedule of Notes Payable (Parenthetical) (Detail) | Sep. 30, 2015 | Dec. 31, 2014 |
Unsecured notes payable due to related parties; interest at 10% per annum; principal and accrued interest due at maturity in September 2015 | ||
Debt Instrument [Line Items] | ||
Interest rate | 10.00% | 10.00% |
Series A notes payable; interest at 8% per annum; principal and accrued interest due at maturity in October 2011 (past due) | ||
Debt Instrument [Line Items] | ||
Interest rate | 8.00% | 8.00% |
Notes payable; interest at 8% per annum; principal and accrued interest due at December 1, 2014 (past due) | ||
Debt Instrument [Line Items] | ||
Interest rate | 8.00% | 8.00% |
Notes payable, interest at 5% and 8% per annum; principal and interest due April 2015 | ||
Debt Instrument [Line Items] | ||
Interest rate | 5.00% | 8.00% |
Notes payable; interest at 5% per annum, principal and accrued interest due at June 10, 2015 | ||
Debt Instrument [Line Items] | ||
Interest rate | 5.00% | |
Notes payable; interest at 8% per annum, principal and accrued interest due at June 25, 2015 | ||
Debt Instrument [Line Items] | ||
Interest rate | 8.00% |
Notes Payable - Additional Info
Notes Payable - Additional Information (Detail) - USD ($) | Jun. 12, 2015 | May. 21, 2015 | Mar. 27, 2015 | Mar. 15, 2015 | Feb. 10, 2015 | Dec. 05, 2014 | Sep. 08, 2014 | Aug. 14, 2014 | Aug. 12, 2014 | Aug. 05, 2014 | Jun. 10, 2014 | Apr. 30, 2015 | Sep. 30, 2015 | Sep. 30, 2014 | Mar. 31, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 |
Debt Instrument [Line Items] | ||||||||||||||||||
Proceeds from issuance of notes payable | $ 159,542 | $ 650,000 | ||||||||||||||||
Accumulated discount, notes payable (in dollars) | $ 10,447 | |||||||||||||||||
Interest expense | $ 4,284 | $ 83,663 | 59,438 | 107,691 | ||||||||||||||
Note payable balance | 50,000 | 50,000 | 812,553 | |||||||||||||||
Accrued interest | $ 42,713 | |||||||||||||||||
Gain (loss) on extinguishment of debt | $ (19,395) | 332,523 | $ (82,000) | |||||||||||||||
Repayment of notes payable | 50,000 | |||||||||||||||||
Cash investment by OPC | $ 1,278,501 | |||||||||||||||||
Warrant | June 10, 2014 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Fair value of warrant liability | 8,113 | |||||||||||||||||
Warrant | August 5, 2014 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Fair value of warrant liability | 5,151 | |||||||||||||||||
Warrant | August 12, 2014 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Fair value of warrant liability | 2,575 | |||||||||||||||||
Warrant | August 14, 2014 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Fair value of warrant liability | 5,153 | |||||||||||||||||
Warrant | September 8, 2014 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Fair value of warrant liability | 7,725 | |||||||||||||||||
Warrant | Debt Instrument Date December 2014 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Fair value of warrant liability | 5,226 | |||||||||||||||||
OPC Partners LLC | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Cash investment by OPC | 1,450,000 | |||||||||||||||||
Notes Payable | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Note payable balance | 134,542 | |||||||||||||||||
Accrued interest | $ 2,271 | |||||||||||||||||
Shares issued on conversion of debt (in shares) | 41,603 | |||||||||||||||||
Pre reverse split shares issued on conversion of debt (in shares) | 3,536,254 | |||||||||||||||||
Pre reverse stock split share price | $ 0.0386 | |||||||||||||||||
Notes Payable | June 10, 2014 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest expense | $ 34,222 | |||||||||||||||||
Interest rate, notes payable | 8.00% | |||||||||||||||||
Note payable balance | $ 250,000 | |||||||||||||||||
Accrued interest | $ 20,263 | |||||||||||||||||
Shares issued on conversion of debt (in shares) | 176,471 | |||||||||||||||||
Pre reverse split shares issued on conversion of debt (in shares) | 15,000,000 | |||||||||||||||||
Pre reverse stock split share price | $ 0.018 | |||||||||||||||||
Gain recorded in additional paid in capital | $ 120,117 | |||||||||||||||||
Notes Payable | August 5, 2014 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Fair value of warrant liability | 7,899 | |||||||||||||||||
Interest expense | $ 22,914 | |||||||||||||||||
Interest rate, notes payable | 8.00% | |||||||||||||||||
Note payable balance | 50,000 | |||||||||||||||||
Accrued interest | $ 3,414 | |||||||||||||||||
Shares issued on conversion of debt (in shares) | 34,898 | |||||||||||||||||
Pre reverse split shares issued on conversion of debt (in shares) | 2,966,210 | |||||||||||||||||
Pre reverse stock split share price | $ 0.018 | |||||||||||||||||
Gain (loss) on extinguishment of debt | $ 23,740 | |||||||||||||||||
Repayment of notes payable | $ 50,000 | |||||||||||||||||
Number of common stock called by warrants | 3,529 | |||||||||||||||||
Notes Payable | August 12, 2014 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest expense | $ 17,455 | |||||||||||||||||
Interest rate, notes payable | 8.00% | |||||||||||||||||
Note payable balance | $ 50,000 | |||||||||||||||||
Accrued interest | $ 3,370 | |||||||||||||||||
Shares issued on conversion of debt (in shares) | 34,843 | |||||||||||||||||
Pre reverse split shares issued on conversion of debt (in shares) | 2,961,644 | |||||||||||||||||
Pre reverse stock split share price | $ 0.018 | |||||||||||||||||
Gain (loss) on extinguishment of debt | $ 23,720 | |||||||||||||||||
Notes Payable | August 14, 2014 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest expense | $ 32,274 | |||||||||||||||||
Interest rate, notes payable | 8.00% | |||||||||||||||||
Note payable balance | 100,000 | |||||||||||||||||
Accrued interest | $ 6,697 | |||||||||||||||||
Shares issued on conversion of debt (in shares) | 69,657 | |||||||||||||||||
Pre reverse split shares issued on conversion of debt (in shares) | 5,920,852 | |||||||||||||||||
Pre reverse stock split share price | $ 0.018 | |||||||||||||||||
Gain (loss) on extinguishment of debt | $ 47,421 | |||||||||||||||||
Notes Payable | September 8, 2014 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest expense | $ 44,140 | |||||||||||||||||
Interest rate, notes payable | 8.00% | |||||||||||||||||
Note payable balance | 150,000 | |||||||||||||||||
Accrued interest | $ 9,222 | |||||||||||||||||
Shares issued on conversion of debt (in shares) | 103,991 | |||||||||||||||||
Pre reverse split shares issued on conversion of debt (in shares) | 8,839,269 | |||||||||||||||||
Pre reverse stock split share price | $ 0.018 | |||||||||||||||||
Gain (loss) on extinguishment of debt | $ 70,766 | |||||||||||||||||
Notes Payable | Debt Instrument Date December 2014 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest expense | $ 10,447 | |||||||||||||||||
Interest rate, notes payable | 8.00% | |||||||||||||||||
Note payable balance | 100,000 | |||||||||||||||||
Accrued interest | $ 3,689 | |||||||||||||||||
Shares issued on conversion of debt (in shares) | 67,637 | |||||||||||||||||
Pre reverse split shares issued on conversion of debt (in shares) | 5,749,163 | |||||||||||||||||
Pre reverse stock split share price | $ 0.018 | |||||||||||||||||
Gain (loss) on extinguishment of debt | $ 46,084 | |||||||||||||||||
Notes Payable | Warrant | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Expected dividend yield | 0.00% | |||||||||||||||||
Notes Payable | Warrant | June 10, 2014 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Expected volatility | 248.20% | |||||||||||||||||
Risk-free interest rate | 1.67% | |||||||||||||||||
Expected warrant term | 5 years | |||||||||||||||||
Proceeds from issuance of notes payable | $ 250,000 | |||||||||||||||||
Fair value of warrant liability | 39,650 | |||||||||||||||||
Accumulated discount, notes payable (in dollars) | $ 34,222 | |||||||||||||||||
Notes Payable | Warrant | August 5, 2014 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Expected volatility | 233.80% | |||||||||||||||||
Risk-free interest rate | 1.67% | |||||||||||||||||
Expected warrant term | 5 years | |||||||||||||||||
Proceeds from issuance of notes payable | $ 100,000 | |||||||||||||||||
Fair value of warrant liability | 29,725 | |||||||||||||||||
Accumulated discount, notes payable (in dollars) | $ 22,914 | |||||||||||||||||
Notes Payable | Warrant | August 12, 2014 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Expected volatility | 233.80% | |||||||||||||||||
Risk-free interest rate | 1.67% | |||||||||||||||||
Expected warrant term | 5 years | |||||||||||||||||
Proceeds from issuance of notes payable | $ 50,000 | |||||||||||||||||
Fair value of warrant liability | 26,817 | |||||||||||||||||
Accumulated discount, notes payable (in dollars) | $ 17,455 | |||||||||||||||||
Notes Payable | Warrant | August 14, 2014 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Expected volatility | 233.80% | |||||||||||||||||
Risk-free interest rate | 1.67% | |||||||||||||||||
Expected warrant term | 5 years | |||||||||||||||||
Proceeds from issuance of notes payable | $ 100,000 | |||||||||||||||||
Fair value of warrant liability | 47,676 | |||||||||||||||||
Accumulated discount, notes payable (in dollars) | $ 32,274 | |||||||||||||||||
Notes Payable | Warrant | September 8, 2014 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Expected volatility | 233.80% | |||||||||||||||||
Risk-free interest rate | 1.67% | |||||||||||||||||
Expected warrant term | 5 years | |||||||||||||||||
Proceeds from issuance of notes payable | $ 150,000 | |||||||||||||||||
Fair value of warrant liability | 62,544 | |||||||||||||||||
Accumulated discount, notes payable (in dollars) | $ 44,140 | |||||||||||||||||
Notes Payable | Warrant | Debt Instrument Date December 2014 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Expected volatility | 229.00% | |||||||||||||||||
Risk-free interest rate | 1.68% | |||||||||||||||||
Expected warrant term | 5 years | |||||||||||||||||
Proceeds from issuance of notes payable | $ 100,000 | |||||||||||||||||
Fair value of warrant liability | 11,812 | |||||||||||||||||
Accumulated discount, notes payable (in dollars) | 10,447 | |||||||||||||||||
Notes Payable | Warrant | Debt Instrument Date December 2014 | During the issuance | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Accumulated discount, notes payable (in dollars) | $ 10,563 | |||||||||||||||||
Notes Payable | Stockholder | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Proceeds from issuance of notes payable | $ 23,000 | |||||||||||||||||
Interest rate, notes payable | 5.00% | |||||||||||||||||
Note payable balance | 23,000 | |||||||||||||||||
Accrued interest | $ 609 | |||||||||||||||||
Shares issued on conversion of debt (in shares) | 15,418 | |||||||||||||||||
Pre reverse split shares issued on conversion of debt (in shares) | 1,310,510 | |||||||||||||||||
Pre reverse stock split share price | $ 0.018 | |||||||||||||||||
Gain recorded in additional paid in capital | $ 10,493 | |||||||||||||||||
Note due date | Apr. 5, 2015 | |||||||||||||||||
Notes Payable | Director | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Proceeds from issuance of notes payable | $ 14,074 | $ 111,102 | $ 4,480 | $ 25,000 | $ 4,887 | |||||||||||||
Interest rate, notes payable | 8.00% | 8.00% | 8.00% | 5.00% | 8.00% | |||||||||||||
Note payable balance | 25,000 | |||||||||||||||||
Accrued interest | $ 417 | |||||||||||||||||
Shares issued on conversion of debt (in shares) | 16,608 | |||||||||||||||||
Pre reverse split shares issued on conversion of debt (in shares) | 1,411,720 | |||||||||||||||||
Pre reverse stock split share price | $ 0.018 | |||||||||||||||||
Gain recorded in additional paid in capital | $ 11,296 | |||||||||||||||||
Minimum | Notes Payable | Warrant | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Expected volatility | 173.70% | |||||||||||||||||
Risk-free interest rate | 1.75% | |||||||||||||||||
Expected warrant term | 4 years | |||||||||||||||||
Maximum | Notes Payable | Warrant | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Expected volatility | 180.70% | |||||||||||||||||
Expected warrant term | 5 years | |||||||||||||||||
Pre Reverse Stock Split | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Number of common stock called by warrants (in shares) | 3,700,000 | 3,700,000 | ||||||||||||||||
Pre Reverse Stock Split | Notes Payable | August 5, 2014 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Number of common stock called by warrants | 300,000 | |||||||||||||||||
Pre Reverse Stock Split | Notes Payable | Warrant | June 10, 2014 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Number of common stock called by warrants (in shares) | 1,000,000 | |||||||||||||||||
Exercise price (in dollars per share) | $ 0.10 | |||||||||||||||||
Pre Reverse Stock Split | Notes Payable | Warrant | August 5, 2014 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Number of common stock called by warrants (in shares) | 600,000 | |||||||||||||||||
Exercise price (in dollars per share) | $ 0.05 | |||||||||||||||||
Pre Reverse Stock Split | Notes Payable | Warrant | August 12, 2014 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Number of common stock called by warrants (in shares) | 300,000 | |||||||||||||||||
Exercise price (in dollars per share) | $ 0.05 | |||||||||||||||||
Pre Reverse Stock Split | Notes Payable | Warrant | August 14, 2014 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Number of common stock called by warrants (in shares) | 600,000 | |||||||||||||||||
Exercise price (in dollars per share) | $ 0.05 | |||||||||||||||||
Pre Reverse Stock Split | Notes Payable | Warrant | September 8, 2014 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Number of common stock called by warrants (in shares) | 900,000 | |||||||||||||||||
Exercise price (in dollars per share) | $ 0.05 | |||||||||||||||||
Pre Reverse Stock Split | Notes Payable | Warrant | Debt Instrument Date December 2014 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Number of common stock called by warrants (in shares) | 600,000 | |||||||||||||||||
Exercise price (in dollars per share) | $ 0.05 |
Warrant Liability - Additional
Warrant Liability - Additional Information (Detail) | May. 26, 2015USD ($) | Jan. 01, 2015USD ($)$ / sharesshares | Jan. 02, 2014USD ($) | Jan. 01, 2014Warrant$ / sharesshares | Sep. 30, 2015USD ($)shares | Dec. 31, 2014USD ($)$ / sharesshares | Jun. 12, 2015USD ($) | Dec. 31, 2012USD ($) |
Major Agreements [Line Items] | ||||||||
Warrant liability | $ 1,829,757 | $ 6,370,709 | ||||||
Licensing fees payable | 2,000,000 | |||||||
Conversion of stock amount | $ 633,333 | |||||||
Fair value of warrants | $ 1,867,417 | |||||||
Convertible Note | ||||||||
Major Agreements [Line Items] | ||||||||
Fair value of warrants | $ 37,000 | |||||||
Pre Reverse Stock Split | ||||||||
Major Agreements [Line Items] | ||||||||
Number of common stock shares purchased under warrants (in shares) | shares | 3,700,000 | |||||||
Series B Convertible Preferred Stock | ||||||||
Major Agreements [Line Items] | ||||||||
Licensing fees payable | $ 6,500,000 | |||||||
Conversion of stock amount | $ 6,500,000 | |||||||
Verify Me | Warrants issued on January 1, 2014 | ||||||||
Major Agreements [Line Items] | ||||||||
Fair value of warrant liability | 149,090 | 121,209 | ||||||
Number of warrants issued | shares | 74,697 | |||||||
Exercise price | $ / shares | $ 0.10 | |||||||
Verify Me | Pre Reverse Stock Split | Warrants issued on January 1, 2014 | ||||||||
Major Agreements [Line Items] | ||||||||
Number of warrants | Warrant | 6,349,245 | |||||||
Agreements | Zaah Technologies | ||||||||
Major Agreements [Line Items] | ||||||||
Warrant liability | $ 2,400,000 | |||||||
Fair value of warrant liability | $ 1,041,091 | $ 787,544 | ||||||
Number of common stock shares purchased under warrants (in shares) | shares | 627,451 | |||||||
Agreements | Zaah Technologies | Pre Reverse Stock Split | ||||||||
Major Agreements [Line Items] | ||||||||
Number of common stock shares purchased under warrants (in shares) | shares | 53,333,333 | |||||||
Agreements | Verify Me | Research and Development Expense | ||||||||
Major Agreements [Line Items] | ||||||||
Initial fair value of warrant expensed as research and development cost | $ 444,000 | |||||||
Patent and Technology Agreement | ||||||||
Major Agreements [Line Items] | ||||||||
Number of common stock shares purchased under warrants (in shares) | shares | 125,000,000 | |||||||
Exercise price | $ / shares | $ 0.10 | |||||||
Additional payment for patent and technology | $ 4,500,000 | |||||||
Discount to market price at time of issuance | 10.00% | |||||||
Current share price (in dollars per share) | $ / shares | $ 0.04 | |||||||
Additional shares issued for patent and technology agreement (in shares) | shares | 125,000,000 | |||||||
Patent and Technology Agreement | Stock Options And Warrants | ||||||||
Major Agreements [Line Items] | ||||||||
Number of warrants to be issued(in shares) | shares | 250,000,000 | |||||||
Exercise price of warrant to be issued(in dollars per share) | $ / shares | $ 0.02 | |||||||
Warrant to be issued value | $ 4,892,089 | |||||||
Patent and Technology Agreement | Warrant | Stock Options And Warrants | ||||||||
Major Agreements [Line Items] | ||||||||
Dividend yield | 0.00% | |||||||
Expected volatility | 229.10% | |||||||
Risk free interest | 1.65% | |||||||
Expected warrant term | 5 years | |||||||
Patent and Technology Agreement | Verify Me | Pre Reverse Stock Split | ||||||||
Major Agreements [Line Items] | ||||||||
Additional shares issued for patent and technology agreement (in shares) | shares | 6,349,206 |
Convertible Preferred Stock - A
Convertible Preferred Stock - Additional Information (Detail) | Jun. 12, 2015USD ($)shares | May. 26, 2015USD ($)shares | Aug. 05, 2013shares | Jan. 31, 2013USD ($)$ / sharesshares | Sep. 30, 2015USD ($)Warrant$ / sharesshares | Dec. 31, 2014USD ($)shares | Jul. 23, 2015shares |
Class of Stock [Line Items] | |||||||
Fair value of warrants | $ | $ 631,678 | $ 494,939 | |||||
Preferred stock, shares authorized | 75,000,000 | ||||||
Licensing fees | $ | 2,000,000 | ||||||
Series A Convertible Preferred Stock | |||||||
Class of Stock [Line Items] | |||||||
Preferred stock value | $ | $ 442 | $ 633,333 | |||||
Number of warrants | Warrant | 392,157 | ||||||
Preferred stock, shares authorized | 37,564,767 | 75,000,000 | |||||
Preferred stock, shares issued | 441,938 | 248,366 | |||||
Series A- Convertible Preferred Stock | |||||||
Class of Stock [Line Items] | |||||||
Preferred stock value | $ | $ 1,278,501 | ||||||
Preferred stock, shares issued | 389,668 | ||||||
Preferred stock convertible ratio | 20 | ||||||
Preferred stock subscribed by an officer and shareholder | 10,667 | 10,667 | |||||
Unpaid compensation value | $ | $ 35,000 | ||||||
Notes payable and accrued interest converted into Series A Preferred Stock | 41,603 | ||||||
Series B Convertible Preferred Stock | |||||||
Class of Stock [Line Items] | |||||||
Preferred stock convertible ratio | 84,967,321 | ||||||
Licensing fees | $ | $ 6,500,000 | ||||||
Maximum | Series A- Convertible Preferred Stock | |||||||
Class of Stock [Line Items] | |||||||
Preferred stock, shares authorized | 37,564,767 | ||||||
Maximum | Series B Convertible Preferred Stock | |||||||
Class of Stock [Line Items] | |||||||
Preferred stock, shares authorized | 85 | ||||||
Pre Reverse Stock Split | |||||||
Class of Stock [Line Items] | |||||||
Number of common stock called by warrants (in shares) | 3,700,000 | ||||||
Conversion of preferred stock, shares | 21,111,111 | 12,222,222 | 21,111,111 | ||||
Pre Reverse Stock Split | Series A Convertible Preferred Stock | |||||||
Class of Stock [Line Items] | |||||||
Number of warrants | Warrant | 33,333,333 | ||||||
Pre Reverse Stock Split | Series A- Convertible Preferred Stock | |||||||
Class of Stock [Line Items] | |||||||
Preferred stock value | $ | $ 1,450,813 | ||||||
Preferred stock, shares issued | 33,121,777 | 37,564,767 | |||||
Preferred stock subscribed by an officer and shareholder | 906,736 | 906,736 | |||||
Notes payable and accrued interest converted into Series A Preferred Stock | 3,536,254 | ||||||
Pre Reverse Stock Split | Series B Convertible Preferred Stock | |||||||
Class of Stock [Line Items] | |||||||
Preferred stock, shares issued | 85 | ||||||
Convertible Preferred Stock Subject to Mandatory Redemption [Member] | Series A Convertible Preferred Stock | |||||||
Class of Stock [Line Items] | |||||||
Preferred stock value | $ | $ 1,000,000 | ||||||
Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Number of preferred stock purchased | 304,785 | ||||||
Conversion of shares of preferred stock to common stock, shares | 248,366 | 248,366 | |||||
Notes payable and accrued interest converted into Series A Preferred Stock | 234,735 | ||||||
Common Stock | Pre Reverse Stock Split | |||||||
Class of Stock [Line Items] | |||||||
Preferred stock converted in to common stock | 12,222,222 | ||||||
Notes payable and accrued interest converted into Series A Preferred Stock | 19,952,489 | ||||||
Subscription Agreement | |||||||
Class of Stock [Line Items] | |||||||
Convertible preferred stock description | At any time before January 31, 2015, VerifyMe had the right, but not the obligation, to require the Company to repurchase all, but not less than all, of the capital stock of the Company and warrants exercisable for capital stock of the Company held by VerifyMe in exchange for the price originally paid by VerifyMe therefore upon the occurrence of any of the following events: (i) the consummation of any bona fide business acquisition, (ii) the incurrence of any indebtedness by the Company in an amount in excess of $2 million, (iii) the issuance or sale of any security having a preference on liquidation senior to Common Stock, or (iv) the sale by the Company of capital stock or warrants exercisable for its capital stock at a price below $0.03 per share. | ||||||
Excess amount for incurring indebtedness | $ | $ 2,000,000 | ||||||
Exercise price of capital stock or warrant | $ / shares | $ 0.03 | ||||||
Fair value of warrants | $ | 2,995,791 | ||||||
Subscription Agreement | Verify Me | Series A Convertible Preferred Stock | |||||||
Class of Stock [Line Items] | |||||||
Beneficial conversion feature at fair market value | $ | $ 0 | $ 0 | |||||
Deemed dividend distribution | $ | $ 1,000,000 | ||||||
Subscription Agreement | Convertible Preferred Stock | Pre Reverse Stock Split | Verify Me | |||||||
Class of Stock [Line Items] | |||||||
Number of preferred stock purchased | 33,333,333 | ||||||
Subscription Agreement | Common Stock | Verify Me | |||||||
Class of Stock [Line Items] | |||||||
Value of shares issued | $ | $ 1,000,000 | ||||||
Exercise price | $ / shares | $ 0.12 | ||||||
Subscription Agreement | Common Stock | Pre Reverse Stock Split | Verify Me | |||||||
Class of Stock [Line Items] | |||||||
Number of common stock called by warrants (in shares) | 33,333,333 |
Fair Value of Financial Instr43
Fair Value of Financial Instruments - Schedule of Liabilities Measured at Fair Value on a Recurring Basis (Detail) - Fair value on a recurring basis | Sep. 30, 2015USD ($) |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Derivative liability related to fair value of warrants | $ 1,829,757 |
Total | 1,829,757 |
Level 3 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Derivative liability related to fair value of warrants | 1,829,757 |
Total | $ 1,829,757 |
Fair Value of Financial Instr44
Fair Value of Financial Instruments - Fair Value Measurements within Fair Value Hierarchy of Derivative Liabilities Using Level 3 Inputs (Detail) | 9 Months Ended |
Sep. 30, 2015USD ($) | |
Debt Instrument Fair Value Carrying Value [Abstract] | |
Beginning balance | $ 6,370,709 |
Conversion of notes payable, net of interest expense | (31,397) |
Conversion of warrants related to licensing fees | (1,867,417) |
Change in fair value of derivative liabilities | (2,642,138) |
Ending balance | $ 1,829,757 |
Fair Value of Financial Instr45
Fair Value of Financial Instruments - Additional Information (Detail) | Sep. 30, 2015USD ($) |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | |
Assets measured at fair value on recurring basis | $ 0 |
Assets or liabilities measured at fair value on non-recurring basis | $ 0 |
Fair Value of Financial Instr46
Fair Value of Financial Instruments - Schedule of Common Stock Purchase Warrants Valuation Assumptions (Detail) - Warrant | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value, Option, Quantitative Disclosures [Line Items] | |
Annual Dividend Yield | 0.00% |
Minimum | |
Fair Value, Option, Quantitative Disclosures [Line Items] | |
Expected Life (Years) | 2 years 3 months |
Risk-free interest rate | 0.64% |
Expected volatility | 170.10% |
Maximum | |
Fair Value, Option, Quantitative Disclosures [Line Items] | |
Expected Life (Years) | 3 years 11 months 9 days |
Risk-free interest rate | 1.37% |
Expected volatility | 174.60% |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Detail) | Oct. 07, 2015USD ($) | Aug. 10, 2015USD ($)$ / sharesshares | Aug. 01, 2015USD ($)shares | Jul. 09, 2015USD ($)$ / sharesshares | Jun. 30, 2015USD ($)Vendorshares | Jun. 12, 2015USD ($)shares | Jun. 11, 2015USD ($)$ / sharesshares | Jun. 02, 2015USD ($)Vendorshares | Jan. 01, 2015$ / sharesshares | Jan. 01, 2014USD ($)$ / sharesshares | Sep. 30, 2015USD ($)shares | Jun. 30, 2015Vendorshares | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($)shares | Sep. 30, 2014USD ($) | Dec. 31, 2014shares | |
Stockholders Equity Note [Line Items] | |||||||||||||||||
Research and development | [1] | $ 58,415 | $ 106,674 | $ 2,194,801 | $ 1,055,290 | ||||||||||||
Common stock, shares issued | shares | 304,785 | 6,259,727 | 6,259,727 | 3,969,106 | |||||||||||||
Common stock, proceeds from sales | $ 50,000 | $ 50,000 | |||||||||||||||
Number of shares exercised | shares | 2,353 | ||||||||||||||||
Restricted stock units issued | shares | 525,000 | ||||||||||||||||
Restricted stock units, Expense | $ 37,188 | 43,386 | |||||||||||||||
Decrease in fair value | (81,000) | $ (81,000) | |||||||||||||||
Minimum | |||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||
Commission on sales, percentage | 200.00% | ||||||||||||||||
Maximum | |||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||
Commission on sales, percentage | 500.00% | ||||||||||||||||
Chief Operating Officer | |||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||
Number of options issued | shares | 375,000 | ||||||||||||||||
Restricted Stock | |||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||
Restricted stock units fair value | $ 446,250 | ||||||||||||||||
Closing stock price per share | $ / shares | $ 0.01 | ||||||||||||||||
Restricted Stock | Chief Operating Officer | |||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||
Restricted stock units fair value | $ 918,000 | ||||||||||||||||
Closing stock price per share | $ / shares | $ 4.08 | ||||||||||||||||
Restricted stock units, Expense | 76,500 | $ 76,500 | |||||||||||||||
Number of options issued | shares | 225,000 | ||||||||||||||||
Vesting period | 3 years | ||||||||||||||||
Vesting period description | Vesting over a three-year period, with one-third vesting the first year and one-twelfth vesting ratably on a quarterly basis thereafter. | ||||||||||||||||
Restricted Stock | Chief Operating Officer | Options Vests Immediately | |||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||
Vesting percentage | 33.33% | ||||||||||||||||
Restricted Stock | Chief Financial Officer | |||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||
Restricted stock units fair value | $ 692,400 | ||||||||||||||||
Closing stock price per share | $ / shares | $ 5.77 | ||||||||||||||||
Restricted stock units, Expense | 70,522 | $ 70,522 | |||||||||||||||
Restricted Stock | Chief Financial Officer | Options Vests Immediately | |||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||
Vesting period | 6 months | ||||||||||||||||
Number of restricted stock issued | shares | 20,000 | ||||||||||||||||
Restricted Stock | Chief Financial Officer | Option Vests One Year | |||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||
Vesting period | 3 years | ||||||||||||||||
Number of restricted stock issued | shares | 100,000 | ||||||||||||||||
Restricted Stock Units | |||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||
Restricted stock units issued | shares | 30,000 | ||||||||||||||||
Restricted stock units, Expense | $ 12,500 | $ 12,500 | |||||||||||||||
Restricted stock units issued, value | $ 75,000 | ||||||||||||||||
Award, description | Additionally, as of August 1, 2015 the Company agreed to issue the individual 30,000 RSUs valued at $75,000 in quarterly installments on November 1, 2015, February 1, 2016, May 1, 2016 and August 1, 2016, which begin vesting on August 1, 2015. | ||||||||||||||||
Subsequent Event | |||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||
Award, compensation payment | $ 15,000 | ||||||||||||||||
Award, additional compensation payment | $ 35,000 | ||||||||||||||||
Pre Reverse Stock Split | |||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||
Common stock, shares issued | shares | 25,906,735 | ||||||||||||||||
Restricted stock units issued | shares | 44,625,000 | ||||||||||||||||
Pre Reverse Stock Split | Chief Operating Officer | |||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||
Number of options issued | shares | 31,875,000 | ||||||||||||||||
Pre Reverse Stock Split | Restricted Stock | Chief Operating Officer | |||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||
Number of options issued | shares | 19,125,000 | ||||||||||||||||
Post Reverse Stock Split | |||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||
Common stock, shares issued | shares | 48,761 | 682,353 | 48,761 | ||||||||||||||
Amount to settle outstanding payable balance | $ 41,447 | $ 58,000 | |||||||||||||||
Common stock received, number of vendors | Vendor | 1 | 2 | 1 | ||||||||||||||
Gain on settlement of conversion | $ 35,153 | ||||||||||||||||
Patent and Technology Agreement | |||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||
Issuance of shares for services (in shares) | shares | 125,000,000 | ||||||||||||||||
Closing stock price per share | $ / shares | $ 0.04 | ||||||||||||||||
Patent and Technology Agreement | Verify Me | |||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||
Worth of common stock to be paid | $ 400,000 | ||||||||||||||||
Percentage of discount | 10.00% | ||||||||||||||||
Closing price of share | $ / shares | $ 0.07 | ||||||||||||||||
Closing price of share after discount | $ / shares | $ 0.063 | ||||||||||||||||
Research and development | $ 400,000 | ||||||||||||||||
Patent and Technology Agreement | Pre Reverse Stock Split | Verify Me | |||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||
Issuance of shares for services (in shares) | shares | 6,349,206 | ||||||||||||||||
[1] | Includes share based compensation of $0 and $2,000,000 for the three and nine months ended September 30, 2015, and $0 and $400,000 for the three and nine months ended September 30, 2014, related to licensing agreements. |
Stock Options - Additional info
Stock Options - Additional information (Detail) | Sep. 25, 2015USD ($)$ / sharesshares | Aug. 10, 2015USD ($)shares | Jul. 09, 2015USD ($)$ / sharesshares | Jun. 11, 2015USD ($)DirectorEmployee$ / sharesshares | Sep. 30, 2015USD ($)shares | Sep. 30, 2015USD ($)shares | Dec. 17, 2003shares | Dec. 31, 2000shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Option, expense | $ | $ 314,960 | $ 349,055 | ||||||
Chief Operating Officer | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of options issued | 375,000 | |||||||
Exercisable common stock share price | $ / shares | $ 0.85 | |||||||
Risk free interest rate | 1.58% | |||||||
Expected Life (Years) | 5 years | |||||||
Stock grant value | $ | $ 1,502,219 | |||||||
Dividend yield | 0.00% | |||||||
Expected volatility | 180.10% | |||||||
Pre Reverse Stock Split | Chief Operating Officer | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of options issued | 31,875,000 | |||||||
Exercisable common stock share price | $ / shares | $ 0.01 | |||||||
Stock Options | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of options available to be issued | 425,882 | 425,882 | ||||||
Exercise price, description | The exercise price of each option may not be less than 100% of the fair market value of the Common Stock on the date of the grant (or 110% of the fair market value in the case of a grantee holding more than 10% of the outstanding stock of the Company). The aggregate fair market value (determined at the time of the grant) of stock for which an employee may exercise Incentive Stock Options under all plans of the company shall not exceed $1,000,000 per calendar year. If any employee shall have the right to exercise any options in excess of $100,000 during any calendar year, the options in excess of $100,000 shall be deemed to be Non-Statutory Stock Options, including prices, duration, transferability and limitations on exercise. | |||||||
Stock Options | Chief Operating Officer | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Vesting period | 3 years | |||||||
Stock Options | Chief Financial Officer | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Risk free interest rate | 1.62% | |||||||
Expected Life (Years) | 5 years | |||||||
Dividend yield | 0.00% | |||||||
Expected volatility | 182.20% | |||||||
Options fair value | $ | $ 1,107,857 | |||||||
Stock Options | Chief Financial Officer | Options Vests Immediately | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of options issued | 200,000 | |||||||
Vesting period | 3 years | |||||||
Stock Options | Director | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of options issued | 75,000 | |||||||
Exercisable common stock share price | $ / shares | $ 2.15 | |||||||
Risk free interest rate | 1.48% | |||||||
Expected Life (Years) | 5 years | |||||||
Vesting period | 5 years | |||||||
Dividend yield | 0.00% | |||||||
Expected volatility | 18350.00% | |||||||
Option fair value | $ | $ 155,003 | |||||||
Stock Options | March 28, 2014 | Director | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of options issued | 1,225,000 | |||||||
Exercisable common stock share price | $ / shares | $ 0.85 | |||||||
Number of employees and directors receiving unit grants | Director | 2 | |||||||
Expected option life (in years) | 5 years | |||||||
Fair value of option issued expensed immediately | $ | $ 993,083 | |||||||
Expected volatility | 176.60% | |||||||
Expected Life (Years) | 5 years | |||||||
Method used to calculate the grant-date fair value of the warrants | Black-Scholes option pricing model | |||||||
Stock Options | March 28, 2014 | Employee | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of employees and directors receiving unit grants | Employee | 3 | |||||||
Stock Options | Pre Reverse Stock Split | Chief Financial Officer | Options Vests Immediately | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of options issued | 17,000,000 | |||||||
Stock Options | Pre Reverse Stock Split | Director | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of options issued | 6,375,000 | |||||||
Stock Options | Pre Reverse Stock Split | March 28, 2014 | Director | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of options issued | 104,125,000 | |||||||
Stock Options | Minimum | March 28, 2014 | Director | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Risk free interest rate | 1.74% | |||||||
Stock Options | Maximum | March 28, 2014 | Director | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Risk free interest rate | 1.75% | |||||||
Stock Options | Stock Option 2000 Plan | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of shares authorized to grant options | 1,500,000 | |||||||
Stock Options | Stock Option 2003 Plan | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of shares authorized to grant options | 18,000,000 | |||||||
Number of options issued | 2,397,953 | |||||||
Number of options available to be issued | 36,027,929 | 36,027,929 |
Stock Options - Non-Employee St
Stock Options - Non-Employee Stock Option/Warrant Activity (Detail) - Stock Options And Warrants | 9 Months Ended |
Sep. 30, 2015$ / sharesshares | |
Option/Warrant Shares | |
Outstanding, beginning balance | shares | 1,425,481 |
Granted | shares | 0 |
Exercised | shares | (45,882) |
Expired | shares | 0 |
Outstanding, ending balance | shares | 1,379,599 |
Exercisable, September 30, 2015 | shares | 1,379,599 |
Weighted Average Remaining Life, Exercisable, September 30, 2015 (years) | 5 years |
Weighted Average Exercise Price | |
Outstanding, beginning balance | $ 8.50 |
Granted | 0 |
Exercised | 0 |
Expired | 0 |
Outstanding, ending balance | 9.11 |
Exercisable, September 30, 2015 | 9.11 |
Minimum | |
Exercise Price | |
Outstanding, beginning balance | 0.85 |
Granted | 0 |
Exercised | 0.85 |
Expired | 0 |
Outstanding, ending balance | 0.85 |
Exercisable, September 30, 2015 | 0.85 |
Maximum | |
Exercise Price | |
Outstanding, beginning balance | 17 |
Granted | 0 |
Exercised | 4.25 |
Expired | 0 |
Outstanding, ending balance | 12.75 |
Exercisable, September 30, 2015 | $ 12.75 |
Stock Options - Incentive Stock
Stock Options - Incentive Stock Option Transactions (Detail) | 9 Months Ended |
Sep. 30, 2015$ / sharesshares | |
Weighted Average Exercise Price | |
Outstanding, beginning balance | $ 4.25 |
Granted | 1.25 |
Exercised | 0 |
Expired/Returned | 0 |
Outstanding, ending balance | 1.97 |
Exercisable, September 30, 2015 | $ 3.62 |
Incentive Stock Options [Member] | |
Option/Warrant Shares | |
Outstanding, beginning balance | shares | 633,725 |
Granted | shares | 1,875,000 |
Exercised | shares | 0 |
Expired/Returned | shares | (308,235) |
Outstanding, ending balance | shares | 2,200,490 |
Exercisable, September, 2015 | shares | 506,740 |
Weighted Average Remaining Life, Exercisable, September 30, 2015 (years) | 7 years 1 month 6 days |
Minimum | Incentive Stock Options [Member] | |
Exercised | |
Outstanding, beginning balance | $ 4.25 |
Granted | 0.85 |
Exercised | 0 |
Expired/Returned | 4.25 |
Outstanding, ending balance | 0.85 |
Exercisable, September 30, 2015 | 0.85 |
Maximum | Incentive Stock Options [Member] | |
Exercised | |
Outstanding, beginning balance | 12.75 |
Granted | 5.95 |
Exercised | 0 |
Expired/Returned | 12.75 |
Outstanding, ending balance | 12.75 |
Exercisable, September 30, 2015 | $ 12.75 |
Operating Leases - Additional I
Operating Leases - Additional Information (Detail) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
General and Administrative Expense | ||||
Operating Leased Assets [Line Items] | ||||
Total rent expense under leases | $ 23,463 | $ 24,459 | $ 55,474 | $ 59,952 |
Operating Leases - Schedule of
Operating Leases - Schedule of Non-cancelable Operating Lease Arrangements for Property (Detail) | Sep. 30, 2015USD ($) |
Leases, Operating [Abstract] | |
2,015 | $ 18,963 |
2,016 | 31,605 |
Total | $ 50,568 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Detail) | Jun. 12, 2015USD ($)Shareholdershares | Dec. 31, 2014USD ($) |
Schedule of Other Related Party Transactions [Line Items] | ||
Number of shareholders | Shareholder | 3 | |
Convertible notes payable | $ | $ 317,000 | $ 114,000 |
Amount of accrued interest owed by shareholders | $ | $ 42,713 | |
Common Stock | ||
Schedule of Other Related Party Transactions [Line Items] | ||
Common stock shares issued on conversion of debt (in shares) | 234,735 | |
Common Stock | Pre Reverse Stock Split | ||
Schedule of Other Related Party Transactions [Line Items] | ||
Common stock shares issued on conversion of debt (in shares) | 19,952,489 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Detail) - shares | Oct. 01, 2015 | Nov. 12, 2015 | Sep. 30, 2015 | Jun. 12, 2015 |
Series A- Convertible Preferred Stock | ||||
Subsequent Event [Line Items] | ||||
Preferred stock subscribed by an officer and shareholder | 10,667 | 10,667 | ||
Series A- Convertible Preferred Stock | Pre Reverse Stock Split | ||||
Subsequent Event [Line Items] | ||||
Preferred stock subscribed by an officer and shareholder | 906,736 | 906,736 | ||
Subsequent Event | Series A- Convertible Preferred Stock | ||||
Subsequent Event [Line Items] | ||||
Preferred stock subscribed by an officer and shareholder | 10,667 | |||
Subsequent Event | Series A- Convertible Preferred Stock | Pre Reverse Stock Split | ||||
Subsequent Event [Line Items] | ||||
Preferred stock subscribed by an officer and shareholder | 906,736 | |||
Subsequent Event | Restricted Stock | Consultant | ||||
Subsequent Event [Line Items] | ||||
Number of restricted stock units authorized | 100,000 | |||
Number of restricted stock units issued | 60,000 | |||
Subsequent Event | Restricted Stock | Consultant | Share Issuance Date One | ||||
Subsequent Event [Line Items] | ||||
Number of restricted stock units to be issued | 20,000 | |||
Subsequent Event | Restricted Stock | Consultant | Share Issuance Date Two | ||||
Subsequent Event [Line Items] | ||||
Number of restricted stock units to be issued | 20,000 |