Common Stock [Text Block] | 13. Common Stock The Company was authorized to issue a total of 510,000,000 500,000,000 0.0001 10,000,000 0.0001 750,000,000 The Company filed the Restated Charter with the Secretary of State of the State of Delaware on April 25, 2017 to increase the Company’s authorized shares to 760,000,000 750,000,000 0.0001 10,000,000 0.0001 Proxy On January 31, 2017, at a special meeting of the Board of Directors, our Board of Directors approved by unanimous vote to seek shareholder approval of certain proposals by written consent that, to adopt and effectuate, will require the majority consent of our stockholders. As of the date of this filing on Form 10-K, we have submitted these proposals to our stockholders pursuant to our definitive proxy statement on Schedule 14A, filed on March 2, 2017 with the Securities and Exchange Commission ("SEC"). Under the proposals we are soliciting our stockholders written consent to approve the filing of an amended and restated certificate of incorporation in Delaware (“Restated Charter”), to increase the number of authorizes shares of our Common Stock, $ 0.0001 500,000,000 750,000,000 Included within our definitive proxy statement on Schedule 14A, filed as of March 2, 2017 with the SEC, we submitted a proposal to our stockholders for written consent to approve the filing of an amended and restated certificate of incorporation in Delaware (the “Restated Charter”) or in a subsequent amendment to the Restated Charter, provisions to effect a reverse split of our issued and outstanding Common Stock, within a range of not less than one-for-fifteen (1:15) and not more than one-for-fifty (1:50), with such ratio to be determined by the Board of Directors, in its sole discretion (the “Reverse Split”), and with such Reverse Split to be effective at such time and date within one year after the date such action is approved by the stockholders, if at all, as determined by the Board of Directors in its sole discretion (the “Reverse Split Proposal”). The Reverse Split proposal, including the final reduced number of shares of Common Stock into which our currently outstanding shares will be converted (within the stockholder-approved range referred to above), if approved by the consent of a majority of our stockholders, will be determined by our Board of Directors in order to list our Common Stock on the Nasdaq Capital Market which, in any event, shall become effective only (a) upon the approved filing of the Restated Charter to consummate the Reverse Split with the Secretary of State of the State of Delaware, including the final reduced number of shares of Common Stock into which our currently outstanding shares will be converted; and (b) upon announcement of the Reverse Split by FINRA. In the event that we receive written consent from a majority of our stockholders entitled to vote thereunder approving the Reverse Split and, subsequently, our Board of Directors elects to consummate the Reverse Split on or prior to March 31, 2017, the Board of Directors will not If implemented, the Reverse Stock Split will only effect our outstanding Common Stock and shares of Common Stock issuable upon conversion of convertible securities and exercise of warrants and options. It will not effect the number of shares of Common Stock we are authorized to issue under our Restated Charter. The purpose of the Reverse Split is to enable us to qualify our Common Stock for listing on a national stock exchange such as The Nasdaq Capital Market or the NYSE AMEX. Our Common Stock is currently traded on the OTC Markets OTCQB marketplace. Such trading market is considered to be less efficient than that provided by a stock exchange such as The Nasdaq Stock Market or NYSE AMEX. In order for us to list our Common Stock on The Nasdaq Stock Market or NYSE MKT, we must fulfill certain listing requirements, including minimum bid price requirements for our Common Stock. On April 4, 2017, the Company’s board of directors approved the Company’s decision to exercise such discretionary right by extending the deadline to receive written consents under the Consent Solicitation from the original date of March 30, 2017 to April 28, 2017. As of April 24, 2017, the Company has received the written consent of more than a majority of the voting power of its Common Stock outstanding as of the Record Date in favor of the Proposals and terminated the Consent Solicitation period. See Note 18 Evaluations of Subsequent Events for additional information related to the proxy. Conversion of Obligations to Stockholder In March 2017, related parties converted $ 2,516,719 92,319 34,787,162 0.075 34,787,162 0.09 34,787,162 0.1125 Sale of Common Stock In January through March 2017 (the “Closing”), the Company received an aggregate of $ 688,000 68.80 Pursuant to its private placement memorandum, dated as of October 31, 2016 (the “Memorandum”), the Company is offering, through a placement agent, a maximum of 500 Units of securities at a price of $10,000 per Unit for up to $5,000,000 in gross proceeds (the “Offering”). Each Unit consists of up to (a) 133,333.33 shares of Common Stock, par value $0.0001 (the “Common Stock”), (b) 18 month warrants to purchase 133,333.33 shares of Common Stock at an exercise price of $0.09 per share (the “Class A Warrants”), and (c) five year warrants to purchase 133,333.33 shares of Common Stock at an exercise price of $0.1125 per share (the “Class B Warrants” and together with the Class A Warrants, the “Investor Warrants”). If all 500 Units are sold, the Company will issue an aggregate of 66,666,667 shares of its Common Stock and Investor Warrants to purchase up to 133,333,334 shares of Common Stock. The Offering terminated on March 31, 2017. In connection with the Closing, the Company issued an aggregate of 9,173,331 0.075 9,173,331 0.09 9,173,331 0.1125 The Company intends to consummate a 1-for-50 reverse stock split of its outstanding Common Stock following the termination date of the Offering, which reverse split has previously been authorized by the Company’s stockholders. Consummation of the Reverse Stock Split will require (a) the filing of an amendment to the Company’s Certificate of Incorporation with the Delaware Secretary of State, and (b) obtaining the approval of FINRA. In connection with the Closing, the Company paid to the placement agent an aggregate of $ 88,040 2,222,000 0.075 In connection with the Closing, the Company also entered into a Registration Rights Agreement (the “Registration Rights Agreement”) with each of the Purchasers, which requires the Company to file a registration statement (the “Registration Statement”) with the Securities and Exchange Commission (the “Commission”) registering for resale (i) all Common Stock issued to the Purchasers as part of the Units, (ii) all shares of Common Stock issuable upon exercise of the Investor Warrants and the warrants issued to the placement agent, and (iii) all shares of Common Stock issued to legal counsel for services rendered in connection with the Closing. If the Registration Statement is not declared effective by the SEC within the specified deadlines set forth in the Registration Rights Agreement, the Company will be required to pay to each Purchaser an amount in cash, as partial liquidated damages, equal to 1.0 6 18 The sale of Common Stock from November through March 2017 (see above) was completed at a unit price of $ 0.075 85,724,996 25,244,336 49,459,532 Consultant Agreements On January 31, 2017, the Board of Directors approved payment of $ 50,000 666,667 0.075 666,667 0.09 666,667 0.1125 On January 31, 2017, the Board of Directors approved payment of 2,000,000 In February 2017, the Company has issued an aggregate of 750,000 500,000 250,000 250,000 250,000 250,000 In March 2017, the Company entered into a consulting agreement with a firm for professional financial advisory and introductory services for a period is from March 8, 2017 through December 31, 2017. Besides a one-time $ 10,000 1,200,000 Anti-Dilution Triggering Event The sale of Common Stock in the 2016/17 Offering was completed at a unit price of $ 0.075 85,724,996 25,244,336 49,459,532 Shares Price Estimated issued and per Gross fair value at Par Additional outstanding share proceeds issuance value paid-in capital Balance as of December 31, 2016 162,471,373 Various $ 59,801,216 $ 2,951,293 $ 16,247 $ 62,440,674 Issuance (a) 9,173,330 $ 0.075 688,000 917 563,508 Issuance (b) 3,416,667 $ various 230,000 342 229,658 Issuance (c) 34,787,162 $ 0.075 2,609,037 3,479 2,605,558 Balance as of March 31, 2017 209,848,532 (d) $ 60,489,216 $ 5,790,330 $ 20,985 $ 65,839,398 (a) Shares issued in conjunction with the 2016/17 Offering and contains no anti-dilution provisions (b) Shares issued in conjunction with certain Consultant Agreements (c) Shares issued for conversion of debt and interests. Shares do not contain anti-dilution provisions (d) Includes 21,214,642 |