Stockholders Deficit | 12 Months Ended |
Dec. 31, 2013 |
Stockholders Deficit | ' |
Stockholders' Deficit | ' |
Note 15 - Stockholders’ Deficit |
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Preferred Stock |
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On October 21, 2010, the Company amended its Articles of Incorporation in New Jersey to authorize 10,000,000 shares of preferred stock, par value $0.10. The designations, rights, and preferences of such preferred stock are to be determined by the Board of Directors. On November 15, 2010, the Company changed its domicile from the State of New Jersey to the State of Wyoming. |
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In addition to the 10,000,000 shares of preferred stock authorized on October 21, 2010, on January 10, 2011, 100 shares of preferred stock were designated as Series A Preferred Stock and 100,000,000 shares were designated as Series B Preferred Stock. The bylaws under the Wyoming Incorporation were amended to reflect the rights and preferences of each additional new designation. |
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The Series A Preferred Stock collectively has voting rights equal to eighty percent of the total current issued and outstanding shares of common stock. If at least one share of Series A Preferred Stock is outstanding, the aggregate shares of Series A Preferred Stock shall have voting rights equal to the number of shares of common stock equal to four times the sum of the total number of shares of common stock issued and outstanding, plus the number of shares of Series B Preferred Stock (or other designated preferred stock) which are issued and outstanding. |
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The Series B Preferred Stock shall have preferential liquidation rights in the event of any liquidation, dissolution or winding up of the Company, such liquidation rights to be paid from the assets of the Company not delegated to parties with greater priority at $1.00 per share or, in the event an aggregate subscription by a single subscriber of the Series B Preferred Stock is greater than $100,000,000, $0.997 per share. The Series B Preferred Stock shall be convertible to a number of shares of common stock equal to the price of the Series B Preferred Stock divided by the par value of the Series B Preferred Stock. The option to convert the shares of Series B Preferred Stock may not be exercised until three months following the issuance of the Series B Preferred Stock to the recipient shareholder. The Series B Preferred Stock shall have ten votes on matters presented to the shareholders of the Company for one share of Series B Preferred Stock held. The initial price of the Series B Preferred Stock shall be $2.50, (subject to adjustment by the Company’s Board of Directors) until such time, if ever, the Series B Preferred Stock are listed on a secondary and/or public exchange. As of December 31, 2013, no shares of Series B Preferred Stock have been issued. |
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In February 2014, the Company's Board of Directors amended the initial price for the Series B Preferred Stock from $2.50 to $1.50 per share. The Company's Board of Directors also amended the conversion feature of the Series B Preferred Stock, to be convertible to common shares $0.0001 par value, at a 40% discount to current market value (“current market value“) at the time the Company receives a conversion request. Current Market Value is defined as the average of the immediately prior five trading day's closing prices. Additionally, when Series B Preferred Stock shares convert to the Company's common stock, the minimum price discount floor level is set at $0.005, as decided by the Company's Board of Directors. |
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Issuance of Series A Preferred Stock |
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In February 2011, the Company issued three (3) shares of non-convertible Series A preferred stock valued at $329,000 per share, or $987,000 in aggregate, for voting purposes only, to the three members of the management team at one share each. The issued and outstanding shares of the Series A preferred stock have voting rights equal to eighty percent of the total issued and outstanding shares of the Company's common stock. This effectively provided them, upon retention of their Series A Preferred Stock, voting control on matters presented to the shareholders of the Company. They have each irrevocably waived their conversion rights relating to the Series A preferred shares issued. The Company expensed $987,000 in stock based compensation expense related to the issuance of the shares in 2011. |
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Common Stock |
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In December 2012, an increase of the authorized shares of the Company’s common stock from five hundred million (500,000,000) to seven hundred fifty million (750,000,000), $0.0001 par value, was ratified, effective upon the filing of an amendment to the Company’s Certificate of Incorporation with the Wyoming Secretary of State. The amendment was adopted in February 2013. |
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In May 2013, an increase of the authorized shares of the Company’s common stock from seven hundred fifty million (750,000,000) to one billion, five hundred million (1,500,000,000), $0.0001 par value, was ratified, effective upon the filing of an amendment to the Company’s Certificate of Incorporation with the Wyoming Secretary of State. The amendment was adopted in May 2013. |
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In July 2013, an increase of the authorized shares of the Company’s common stock from one billion, five hundred million (1,500,000,000) to three billion (3,000,000,000), $0.0001 par value, was ratified, effective upon the filing of an amendment to the Company’s Certificate of Incorporation with the Wyoming Secretary of State. The amendment was adopted in July 2013. |
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In August 2013, an increase of the authorized shares of the Company’s common stock from three billion (3,000,000,000) to five billion (5,000,000,000), $0.0001 par value, was ratified, effective upon the filing of an amendment to the Company’s Certificate of Incorporation with the Wyoming Secretary of State. The amendment was adopted in September 2013. |
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In December 2013, an increase of the authorized shares of the Company's common stock from five billion (5,000,000,000) to six billion seven hundred fifty million (6,750,000,000), $0.0001 par value, was ratified, effective upon the filing of an amendment to the Company's Certificate of Incorporation with the Wyoming Secretary of State. The amendment was adopted in January 2014. |
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In February 2014, a 1:1,500 reverse stock split of the Company's issued and outstanding shares of common stock was ratified, effective upon the filing of an amendment to the Company's Certificate of Incorporation with the Wyoming Secretary of State. The amendment was adopted in March 2014. |
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All shares and per share amounts in the financial statements have been adjusted to give retroactive effect to the 1:1500 Reverse Stock Split. |
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In February 2014, a decrease of the authorized shares of the Company's common stock from six billion seven hundred fifty million (6,750,000,000) to one billion, five hundred million (1,500,000,000), $0.0001 par value, was ratified, effective upon the filing of an amendment to the Company's Certificate of Incorporation with the Wyoming Secretary of State. The amendment was adopted in March 2014. |
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Issuance of Common Stock for Services |
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In December 2009, the Company entered into a retainer agreement with an attorney, whereas the attorney acts as house counsel for the Company with respect to all general corporate matters. The agreement is at will and required a payment of 67 shares of common stock, valued at $75 per share, as adjusted by the Company’s 1:1,500 reverse stock split, due upon execution. Commencing on January 1, 2010, the fee structure also includes a monthly cash fee of $1,000 and the monthly issuance of 2,500 shares of common stock, valued at market, and the total of which remains 2,500 shares post to the Company's reverse stock split. In December 2012, the Company recorded $19 in legal fees related to the agreement, as common stock to be issued. The 5 shares of restricted common stock, as adjusted by the Company’s 1:1,500 reverse stock split, were issued in February 2013. For the years ended December 31, 2013 and 2012, the Company issued a total of 20 shares of restricted common stock, valued at $109 and 15 shares of restricted common stock, as adjusted by the Company’s 1:1,500 reverse stock split, valued at $230, respectively, all of which have been expensed as legal fees, related to the agreement. In December 2013, the Company recorded $1 in legal fees related to the agreement, as common stock to be issued. The 5, as adjusted by the Company’s 1:1,500 reverse stock split, shares of restricted common stock were issued in March 2014. |
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In April 2011, the Company entered into a marketing advisory and financial agreement with a marketing firm whereby the consultant serves as a marketing and financial advisor to the Company. The agreement terminated on April 1, 2012. For acting in this role, the consultant received 3,334 shares of the Company’s common stock, as adjusted by the Company’s 1:1,500 reverse stock split, valued at $130,000, in April 2011, which was expensed as consulting fees. The consultant also received warrants to purchase 4,334 shares of the Company’s common stock in April 2011. The warrants were exercisable at $90 per share for 1,334 shares, $165 per share for 1,334 shares, $240 per share for 1,000 shares and $390 per share for 666 shares, as adjusted by the Company’s 1:1,500 reverse stock split. The warrants were only exercisable if certain contractual thresholds are met as of June 1, 2012. The Company terminated the warrants in June 2012 because the thresholds were not met by the firm. |
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In November 2011, the Company entered into a consulting agreement with a firm whereby the consultant will receive a success fee, in the form of restricted shares of the Company’s common stock, of 6% of all monies invested in the Company as a result of a term sheet the Company executed with an investor firm in November 2011. In December 2011, the consultant received 230 shares of the Company’s common stock, as adjusted by the Company’s 1:1,500 reverse stock split, valued at $4,500 and all of which has been expensed as consulting fees, as a result of the first investor tranche of $75,000. In January 2012, the consultant received 177 shares of the Company’s common stock, as adjusted by the Company’s 1:1,500 reverse stock split, valued at $4,500, as a result of the second investor tranche of $75,000. In February 2012, the consultant received 185 shares of the Company’s common stock, as adjusted by the Company’s 1:1,500 reverse stock split, valued at $4,500, as a result of the third investor tranche of $75,000. In March 2012, the consultant received 215 shares of the Company’s common stock, as adjusted by the Company’s 1:1,500 reverse stock split, valued at $4,500, as a result of the fourth investor tranche of $75,000 (see Note 14). The value of all of the shares issued was expensed as consulting fees. |
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In January 2012, the Company issued 1,334 restricted shares of its common stock, as adjusted by the Company’s 1:1,500 reverse stock split, to a consultant in consideration of the consultant’s past support of the Company through several areas of assistance. The shares were valued at $36,000, all of which has been expensed as consulting fees. |
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In May 2012, the Company entered into a consulting agreement with a firm whereby the consultant will provide public relations services to the Company. The consultant will receive a fee of $7,000 per month and $500 per month in the form of restricted shares of the Company's common stock valued on the closing market price of the first day of each month that the agreement is in effect. In May 2012, the consultant received 23 shares of the Company’s common stock, as adjusted by the Company’s 1:1,500 reverse stock split, valued at $500. In June 2012, the consultant received 38 shares of the Company’s common stock, as adjusted by the Company’s 1:1,500 reverse stock split, valued at $500. In July 2012, the consultant received 42 shares of the Company’s common stock, as adjusted by the Company’s 1:1,500 reverse stock split, valued at $500. In August 2012, the consultant received 39 shares of the Company’s common stock, as adjusted by the Company’s 1:1,500 reverse stock split, valued at $500. In September 2012, the consultant received 36 shares of the Company’s common stock, as adjusted by the Company’s 1:1,500 reverse stock split, valued at $500. In October 2012, the consultant received 36 shares of the Company’s common stock, as adjusted by the Company’s 1:1,500 reverse stock split, valued at $500. In December 2012, the consultant received 58 shares of the Company’s common stock, as adjusted by the Company’s 1:1,500 reverse stock split, valued at $500. In March 2013, the consultant received 369 shares of the Company's common stock, as adjusted by the Company’s 1:1,500 reverse stock split, valued at $1,500, for payment of three months of services. In June 2013, the consultant received 159 shares of the Company's common stock, as adjusted by the Company’s 1:1,500 reverse stock split, valued at $1,500, for payment of three months of services. In October 2013, the consultant received 389 shares of the Company's common stock, as adjusted by the Company’s 1:1,500 reverse stock split, valued at $750, for payment of one and one-half months of services. The value of all of the shares issued has been expensed as consulting fees (see Note 14). |
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In November 2012, the Company issued a total of 234 restricted shares of its common stock, as adjusted by the Company’s 1:1,500 reverse stock split, to the five members of its advisory board for serving in that capacity. The shares were valued at $2,275, all of which has been expensed as consulting fees. |
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Issuance of Common Stock for Financing |
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In March 2010, the Company executed a promissory note for $50,000 with its CEO, bearing interest at 10% per annum, maturing on April 30, 2011. Per the terms of the promissory note, the note holder purchased two units with each unit consisting of a 10% promissory note of $25,000 and 34 restricted shares of the Company’s common stock, valued at $37.50 per share and expensed in 2010, for a total of 68 shares of common stock, as adjusted by the Company’s 1:1,500 reverse stock split. In January 2014, the note was extended to December 31, 2014 (see Note 10). |
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In April 2010, the Company executed a promissory note for $80,000, bearing interest at 10% per annum, maturing on July 23, 2010. As consideration for executing the note, the Company issued 334 shares of restricted common stock, valued at $31.50 per share, as adjusted by the Company’s 1:1,500 reverse stock split, and expensed in 2010, to the note holder. On May 2, 2011, the Company repaid $10,000 of the note balance to the note holder. Per the terms of a settlement agreement that the Company executed with the note holder in January 2012, the Company issued 3,373 restricted shares of its common stock, valued at $24.75 per share, as adjusted by the Company’s 1:1,500 reverse stock split, to the note holder as settlement of the remaining note balance of $70,000 plus accrued interest (see Note 9). |
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In May 2010, the Company executed a promissory note for $50,000, bearing interest at 10% per annum, maturing on May 21, 2013. As consideration for executing the note, the Company issued 134 shares of restricted common stock, valued at $13.50 per share, as adjusted by the Company’s 1:1,500 reverse stock split, to the note holder. For the years ended December 31, 2013 and 2012, the Company expensed $250 and $600, respectively, of financing expenses related to the shares (see Note 9). |
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In May 2012, the Company issued 375 restricted shares of its common stock, as adjusted by the Company’s 1:1,500 reverse stock split, valued at $9,000, to an investor firm as consideration for entering into and structuring an Equity Facility Agreement. The shares were included in the Form S-1 the Company with the SEC in June 2012. The value of the shares has been expensed as financing expense (see Note 14). |
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Issuance of Common Stock for Settlement of Accounts Payable |
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In August 2011, the Company issued 600 shares of its common stock, valued at $45 per share, as adjusted by the Company’s 1:1,500 reverse stock split, to a vendor for settlement of accounts payable. In March 2012, the remaining accounts payable balance was settled and the Company issued 1,200 shares of its common stock, valued at $22.50 per share, as adjusted by the Company’s 1:1,500 reverse stock split, to the vendor (see Note 14). |
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Issuance of Common Stock for the Sale and Settlement of Debt |
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Per the terms of a settlement agreement that the Company executed with its former President in January 2012, the Company issued 999 restricted shares of its common stock, valued at $21 per share, as adjusted by the Company’s 1:1,500 reverse stock split, to its former President for settlement of accrued interest owed (see Notes 10 and 14). |
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Per the terms of a settlement agreement that the Company executed with a note holder in January 2012, the Company issued 3,373 restricted shares of its common stock, valued at $24.75 per share, as adjusted by the Company’s 1:1,500 reverse stock split, to the note holder for settlement of a promissory note and accrued interest (see Note 9). |
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Conversions to Common Stock |
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For the year ended December 31, 2013, the Company received conversion notices from ICG to convert $36,660 of the January 3, 2012 note into 16,667 unrestricted shares of the Company's common stock. The conversions were processed on January 24, 2013 for $11,280 into 6,667 shares at a conversion price of $1.692 per share and on May 17, 2013 for $25,380 into 10,000 shares at a conversion price of $2.538 per share, as adjusted by the Company’s 1:1,500 reverse stock split (see Note 7). |
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For the year ended December 31, 2012, the Company received conversion notices from ICG to convert $75,000 of the December 5, 2011 note, plus accrued interest of $2,417, into 19,561 unrestricted shares of the Company's common stock, as adjusted by the Company’s 1:1,500 reverse stock split. The conversions were processed on June 15, 2012 for $15,000 into 1,779 shares at a conversion price of $8.433 per share, on August 15, 2012 for $25,000 into 5,051 shares at a conversion price of $4.95 per share, on November 30, 2012 for $22,080 into 6,667 shares at a conversion price of $3.312 per share and on December 18, 2012 for $15,337 into 6,064 shares at a conversion price of $2.529 per share, as adjusted by the Company’s 1:1,500 reverse stock split. The Company also received a conversion notice from ICG to convert $9,953 of the January 3, 2012 note into 3,936 unrestricted shares of the Company's common stock. The conversion was processed on December 18, 2012 at a conversion price of $2.529 per share, as adjusted by the Company’s 1:1,500 reverse stock split (see Note 7). |
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For the year ended December 31, 2013, the Company received conversion notices from Asher to convert the remaining balance of $8,500 of the note due February 8, 2013, including accrued interest of $1,300, the full balance of $42,500 of the note due April 30, 2013, including accrued interest of $1,700, the full balance of $32,500 of the note due August 5, 2013, including accrued interest of $1,300, the full balance of $50,340 of the note due June 14, 2013, the full balance of $42,500 of the note due September 27, 2013, including accrued interest of $1,700, the full balance of $42,500 of the note due November 26, 2013, including accrued interest of $1,700, the full balance of $50,000 of the note due April 15, 2014, the full balance of $50,000 of the note due July 9, 2014, the full balance of $42,500 of the note due January 24, 2014, including accrued interest of $1,700, and $22,400 of the note due March 6, 2014 into 576,390 unrestricted shares of the Company's common stock, at conversion prices ranging from $0.15 to $4.65 per share, as adjusted by the Company’s 1:1,500 reverse stock split (see Note 7). |
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For the year ended December 31, 2012, the Company received conversion notices from Asher to convert the note dated April 11, 2012, for $53,000, and $2,120 in accrued interest, into 12,187 unrestricted shares of the Company’s common stock, as adjusted by the Company’s 1:1,500 reverse stock split. The conversions were processed on October 19, 2012 for $12,000 into 1,600 shares at a conversion price of 7.50 per share, on October 31, 2012 for $14,000 into 2,122 shares at a conversion price of $6.60 per share, on November 14, 2012 for $12,000 into 2,759 shares at a conversion price of $4.35 per share and on November 27, 2012 for $17,120 into 5,706 shares at a conversion price of $3.00 per share, as adjusted by the Company’s 1:1,500 reverse stock split. The Company also received conversion notices from Asher to convert $24,000 of the May 4, 2012 note into 12,821 unrestricted shares of the Company's common stock. The conversions were processed on December 13, 2012 for $12,000 into 6,154 shares at a conversion price of $1.95 per share and on December 21, 2012 for $12,000 into 6,667 shares at a conversion price of $1.80 per share, as adjusted by the Company’s 1:1,500 reverse stock split (see Note 7). |
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For the year ended December 31, 2013 the Company received conversion notices from Auctus to convert the full balance of $27,750 of the note due August 30, 2013, including accrued interest of $1,291, the full balance of $27,750 of the note due November 19, 2013, including accrued interest of $1,308, and $15,750 of the note due February 28, 2014 into 147,667 unrestricted shares of the Company's common stock, at conversion prices ranging from $0.27 to $3.195 per share, as adjusted by the Company’s 1:1,500 reverse stock split (see Note 7). |
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For the year ended December 31, 2012, Auctus had no conversions. |
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For the year ended December 31, 2013 the Company received a conversion notice from Klei to convert the full balance of $25,000 of the note due April 23, 2014, including accrued interest of $1,112, into 58,028 unrestricted shares of the Company's common stock, at a conversion price of $0.45 per share, as adjusted by the Company’s 1:1,500 reverse stock split (see Note 7). |
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For the year ended December 31, 2013, the Company received conversion notices from Iconic to convert the full balance of $55,152 of one of the notes due June 4, 2014, the full balance of $50,000 of another of the notes due June 4, 2014, the full balance of $60,000 of the note due July 17, 2014, the full balance of $70,000 of one of the notes due October 4, 2014, $50,498 of the remaining note due June 4, 2014 into 712,079 unrestricted shares of the Company's common stock, at conversion prices ranging from $0.09 to $2.61 per share, as adjusted by the Company’s 1:1,500 reverse stock split (see Note 7). |
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For the year ended December 31, 2013, the Company received conversion notices from Southridge to convert the full balance of $25,000 of the note due July 16, 2014, and $375 in legal fees, the full balance of $25,000 of the note due August 4, 2014, and $275 in legal fees, and the full balance of $25,000 of the note due August 18, 2014, and $375 in legal fees, into 179,824 unrestricted shares of the Company's common stock, at conversion prices ranging from $0.33 to $0.5775 per share, as adjusted by the Company’s 1:1,500 reverse stock split (see Note 7). |
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For the year ended December 31, 2013, the Company received conversion notices from WHC to convert $41,057 of the note due November 13, 2014 into 181,307 unrestricted shares of the Company's common stock, at conversion prices ranging from $0.087 to $0.261 per share, as adjusted by the Company’s 1:1,500 reverse stock split (see Note 7). |
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For the year ended December 31, 2013 the Company received a conversion notice from Tarpon to convert $16,750 of the note due September 20, 2014 into 203,031 unrestricted shares of the Company's common stock, at a conversion price of $0.0405 per share, as adjusted by the Company’s 1:1,500 reverse stock split (see Note 7). |
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Sale of Common Shares |
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In January 2012, the Company sold subscriptions to one individual for certain units containing common stock and warrants. The Company issued 2,280 shares of its common stock at $25.50 per share and warrants to purchase a total of 1,140 shares of the Company’s common stock, exercisable at $45 per share that expire in January 2015, as adjusted by the Company’s 1:1,500 reverse stock split. |
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In February 2012, the Company sold subscriptions to one individual for certain units containing common stock and warrants. The Company issued 2,963 shares of its common stock at $24 per share and warrants to purchase a total of 1,482 shares of the Company’s common stock, exercisable at $45.00 per share that expire in February 2015, as adjusted by the Company’s 1:1,500 reverse stock split. |
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In March 2012, the Company sold subscriptions to one individual for certain units containing common stock and warrants. The Company issued 1,812 shares of its common stock at $22.50 per share and warrants to purchase a total of 906 shares of the Company’s common stock, exercisable at $45.00 per share that expire in February 2015, as adjusted by the Company’s 1:1,500 reverse stock split. |
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In April 2012, the Company sold to three individuals certain units which contained common stock and warrants. The Company issued 4,650 shares of its common stock at $15.00 per share for 1,646 shares and $16.50 per share for 3,004 shares. The Company also issued warrants to purchase a total of 2,325 shares of the Company’s common stock, exercisable at $30 per share that expire in April 2015, as adjusted by the Company’s 1:1,500 reverse stock split. |
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In June 2012, the Company sold subscriptions to one individual for certain units containing common stock and warrants. The Company issued 2,667 shares of its common stock at $10.50 per share and warrants to purchase a total of 1,334 shares of the Company’s common stock, exercisable at $30 per share that expire in June 2015, as adjusted by the Company’s 1:1,500 reverse stock split. |
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In July 2012, the Company sold to two individuals certain units which contained restricted common stock and warrants. The Company issued 9,662 shares of its common stock at 7.05 per share for 7,048 shares and $9.60 per share for 2,614 shares. The Company also issued warrants to purchase a total of 4,831 shares of its common stock, exercisable at $30 per share that expires in July 2015, as adjusted by the Company’s 1:1,500 reverse stock split. |
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In August 2012, the Company sold subscriptions to one individual for certain units containing restricted common stock and warrants. The Company issued 3,704 shares of its common stock at $6.75 per share and warrants to purchase a total of 1,852 shares of its common stock, exercisable at $30 per share that expire in August 2015, as adjusted by the Company’s 1:1,500 reverse stock split. |
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In September 2012, the Company sold to two individuals certain units which contained restricted common stock and warrants. The Company issued 5,303 shares of its common stock at $8.40 per share for 2,963 shares and $10.65 per share for 2,340 shares. The Company also issued warrants to purchase a total of 2,652 shares of its common stock, exercisable at $30 per share that expires in September 2015, as adjusted by the Company’s 1:1,500 reverse stock split. |
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In October 2012, the Company sold to an individual for certain units containing common stock and warrants. The Company issued 3,704 shares of its common stock at $6.75 per share and warrants to purchase a total of 1,852 shares of the Company’s common stock, exercisable at $30 per share that expire in October 2015, as adjusted by the Company’s 1:1,500 reverse stock split. |
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Issuance of Warrants for Financing and Acquiring Services |
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In connection with consulting agreements, the Company issued warrants for 10,044 shares to consultants, as adjusted by the Company’s 1:1,500 reverse stock split, all of which were deemed earned upon issuance, as of December 31, 2013 (see Note 14). The fair value of these warrants granted, estimated on the date of grant using the Black-Scholes option-pricing model, was $1,004,403, which has been recorded as consulting expenses. |
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The table below summarizes the Company’s non-derivative warrant activities through December 31, 2013, as adjusted by the Company’s 1:1,500 reverse stock split: |
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| | Number of | | Exercise Price Range Per Share | | Weighted Average Exercise Price | | Fair Value at Date of Issuance | | Aggregate | | | | |
Warrant Shares | Intrinsic | | | | |
| Value | | | | |
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Balance, December 31, 2011 | | 160,646 | | $ | 6.00-15,000.00 | | $ | 75 | | $ | 2,742,658 | | $ | - | | | | |
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Granted | | 20,081 | | | 30.00-60.00 | | | 45 | | | 88,850 | | | - | | | | |
Canceled for cashless exercise | | (-) | | | - | | | - | | | - | | | - | | | | |
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Exercised (Cashless) | | (-) | | | - | | | - | | | - | | | - | | | | |
Exercised | | (-) | | | - | | | - | | | - | | | - | | | | |
Expired | | -5,391 | | | 6.00-8,250.00 | | | 315 | | | -1,305,717 | | | - | | | | |
Balance, December 31, 2012 | | 175,336 | | $ | 2.25-15,000.00 | | $ | 73.5 | | $ | 1,525,791 | | $ | - | | | | |
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Granted | | 61,162 | | | 6.00-600.00 | | | 600 | | | 64,692 | | | - | | | | |
Canceled for cashless exercise | | (-) | | | - | | | - | | | - | | | - | | | | |
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Exercised (Cashless) | | (-) | | | - | | | - | | | - | | | - | | | | |
Exercised | | (-) | | | - | | | - | | | - | | | - | | | | |
Expired | | -24,253 | | | 22.50-15,000.00 | | | 49.5 | | | -482,177 | | | - | | | | |
Balance, December 31, 2013 | | 212,245 | | $ | 2.25-15,000.00 | | $ | 238.5 | | $ | 1,108,306 | | $ | - | | | | |
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Vested and exercisable, December 31, 2013 | | 212,245 | | $ | 2.25-15,000.00 | | $ | 238.5 | | $ | 1,108,306 | | $ | - | | | | |
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Unvested, December 31, 2013 | | - | | $ | - | | $ | - | | $ | - | | $ | - | | | | |
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The following table summarizes information concerning outstanding and exercisable warrants as of December 31, 2013, as adjusted by the Company’s 1:1,500 reverse stock split: |
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| | Warrants Outstanding | | Warrants Exercisable |
Range of Exercise Prices | | Number Outstanding | | Average Remaining Contractual Life (in years) | | Weighted Average Exercise Price | | Number Exercisable | | Average Remaining Contractual Life (in years) | | Weighted Average Exercise Price |
| | | | | | | | | | | | | | | | | | |
$15,000.00 | | | 3 | | | 0.71 | | $ | 15,000.00 | | | 3 | | | 0.71 | | $ | 15,000.00 |
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$22.50-1,200.00 | | | 212,242 | | | 1.3 | | $ | 75 | | | 212,242 | | | 1.3 | | $ | 75 |
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$22.50 - $15,000.00 | | | 212,245 | | | 1.3 | | $ | 75 | | | 212,245 | | | 1.3 | | $ | 75 |
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Issuance of Stock Options to Parties Other Than Employees for Acquiring Goods or Services |
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In January 2013, the Company granted an option to purchase 6,667 shares of its common stock, as adjusted by the Company’s 1:1,500 reverse stock split, to NetLabs, Inc. in exchange for the assignment of the entire right, title and interest in and to the “Out-of-Band Patent”. The Options were valued at $2.7 per share, as adjusted by the Company’s 1:1,500 reverse stock split, or $18,000, which was recorded as Patent. |
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The Company estimated the fair value of the options on the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions: |
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| | 30-Jan-13 | | | | | | | | | | | | | | | |
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Expected life (year) | | | 10 | | | | | | | | | | | | | | | |
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Expected volatility | | | 142.00% | | | | | | | | | | | | | | | |
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Risk-free interest rate | | | 2.03% | | | | | | | | | | | | | | | |
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Expected annual rate of quarterly dividends | | | 0.00% | | | | | | | | | | | | | | | |
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As of December 31, 2013, options to purchase an aggregate of 8,000 shares of its common stock, as adjusted by the Company’s 1:1,500 reverse stock split, for non-employees were outstanding. The exercise price of the options to purchase 1,333 and 6,667 shares its common stock is $9.00 and $2.7, respectively, yielding a weighted average exercise price of $4.50, as adjusted by the Company’s 1:1,500 reverse stock split. In January 2013, options to purchase an aggregate of 507 of the Company's common stock at $5,400 per share, as adjusted by the Company’s 1:1,500 reverse stock split, were cancelled per an agreement executed with NetLabs, Inc. Also in January 2013, options to purchase an aggregate of 2 shares of the Company's common stock, at $13,500 per share, as adjusted by the Company’s 1:1,500 reverse stock split, expired. |