Document And Entity Information
Document And Entity Information - shares | 6 Months Ended | |
Jun. 30, 2016 | Aug. 09, 2016 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 30, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q2 | |
Entity Registrant Name | 22nd Century Group, Inc. | |
Entity Central Index Key | 1,347,858 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Trading Symbol | XXII | |
Entity Common Stock, Shares Outstanding | 82,198,113 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Jun. 30, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash | $ 2,840,577 | $ 3,760,297 |
Accounts receivable, net | 105,729 | 51,230 |
Inventory, net | 3,146,933 | 2,706,330 |
Prepaid expenses and other assets | 717,478 | 635,998 |
Total current assets | 6,810,717 | 7,153,855 |
Machinery and equipment, net | 2,414,726 | 2,555,793 |
Other assets: | ||
Intangible assets, net | 7,385,456 | 7,364,120 |
Equity investment | 1,080,580 | 1,222,651 |
Total other assets | 8,466,036 | 8,586,771 |
Total assets | 17,691,479 | 18,296,419 |
Current liabilities: | ||
Current portion of note payable | 320,878 | 308,582 |
Accounts payable | 1,567,424 | 1,283,346 |
Accrued expenses | 1,191,219 | 1,349,438 |
Accrued severance | 225,117 | 220,661 |
Total current liabilities | 3,304,638 | 3,162,027 |
Long-term portion of note payable | 307,938 | 307,938 |
Long-term portion of accrued severance | 90,101 | 199,658 |
Warrant liability | 26,699 | 2,898,296 |
Total liabilities | 3,729,376 | 6,567,919 |
Commitments and contingencies (Note 11 ) | 0 | 0 |
Shareholders' equity | ||
Common shares value | 760 | 710 |
Capital in excess of par value | 86,673,174 | 78,284,815 |
Accumulated deficit | (72,711,831) | (66,557,025) |
Total shareholders’ equity | 13,962,103 | 11,728,500 |
Total liabilities and shareholders’ equity | $ 17,691,479 | $ 18,296,419 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Jun. 30, 2016 | Dec. 31, 2015 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, par value | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common stock, par value | $ 0.00001 | $ 0.00001 |
Common stock, shares issued | 76,025,273 | 71,066,844 |
Common stock, shares outstanding | 76,025,273 | 71,066,844 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Revenue: | ||||
Sale of products, net | $ 2,827,658 | $ 2,306,953 | $ 5,846,714 | $ 2,923,091 |
Cost of goods sold (exclusive of depreciation shown separately below): | ||||
Products | 2,968,571 | 2,600,446 | 5,863,981 | 3,233,026 |
Gross loss | (140,913) | (293,493) | (17,267) | (309,935) |
Operating expenses: | ||||
Research and development | 509,928 | 283,600 | 1,107,319 | 442,069 |
General and administrative | 1,721,775 | 1,297,064 | 3,568,382 | 4,948,785 |
Sales and marketing costs | 251,106 | 290,775 | 953,720 | 406,004 |
Depreciation | 81,067 | 78,630 | 161,664 | 157,440 |
Amortization | 126,041 | 109,702 | 250,882 | 216,289 |
Total operating expenses | 2,689,917 | 2,059,771 | 6,041,967 | 6,170,587 |
Operating loss | (2,830,830) | (2,353,264) | (6,059,234) | (6,480,522) |
Other income (expense): | ||||
Warrant liability (loss) gain - net | (9,468) | 112,620 | 61,597 | 171,833 |
Settlement proceeds | 0 | 1,000,000 | 0 | 1,000,000 |
Loss on equity investment | (54,839) | (40,834) | (142,071) | (91,815) |
Interest income | 2,105 | 6,528 | 4,598 | 14,323 |
Interest expense | (9,322) | (13,753) | (19,696) | (19,261) |
Total other income (expense) | (71,524) | 1,064,561 | (95,572) | 1,075,080 |
Loss before income taxes | (2,902,354) | (1,288,703) | (6,154,806) | (5,405,442) |
Income taxes | 0 | 0 | 0 | 0 |
Net loss | $ (2,902,354) | $ (1,288,703) | $ (6,154,806) | $ (5,405,442) |
Loss per common share - basic and diluted | $ (0.04) | $ (0.02) | $ (0.08) | $ (0.08) |
Common shares used in basic earnings per share calculation | 76,024,064 | 66,616,739 | 75,027,606 | 65,408,908 |
CONSOLIDATED STATEMENTS OF OPE5
CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Research and Development Expense [Member] | ||||
Allocated Share-based Compensation Expense | $ 38,225 | $ 31,913 | $ 83,281 | $ 77,476 |
General and Administrative Expense [Member] | ||||
Allocated Share-based Compensation Expense | 176,747 | 314,534 | 402,922 | 2,705,355 |
Sales and Marketing Costs Expense [Member] | ||||
Allocated Share-based Compensation Expense | $ 5,250 | $ 11,211 | $ 16,886 | $ 16,032 |
CONSOLIDATED STATEMENT OF SHARE
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY - 6 months ended Jun. 30, 2016 - USD ($) | Total | Common Stock [Member] | Contributed Capital [Member] | Accumulated Deficit [Member] |
Beginning balance at Dec. 31, 2015 | $ 11,728,500 | $ 710 | $ 78,284,815 | $ (66,557,025) |
Beginning balance, shares at Dec. 31, 2015 | 71,006,844 | |||
Common stock issued in February 2016 registered direct offering | 5,091,791 | $ 50 | 5,091,741 | 0 |
Common stock issued in February 2016 registered direct offering (in shares) | 5,000,000 | |||
Reclassification of warrant liability to capital in excess of par | 2,810,000 | $ 0 | 2,810,000 | 0 |
Stock based compensation | 486,422 | $ 0 | 486,422 | 0 |
Stock based compensation (in shares) | 15,811 | |||
Stock issued in connection with warrant exercise | 196 | $ 0 | 196 | 0 |
Stock issued in connection with warrant exercise (in shares) | 2,618 | |||
Net loss | (6,154,806) | $ 0 | 0 | (6,154,806) |
Ending balance at Jun. 30, 2016 | $ 13,962,103 | $ 760 | $ 86,673,174 | $ (72,711,831) |
Ending balance, shares at Jun. 30, 2016 | 76,025,273 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Cash flows from operating activities: | ||
Net loss | $ (6,154,806) | $ (5,405,442) |
Adjustments to reconcile net loss to cash used in operating activities: | ||
Amortization and depreciation | 363,535 | 324,718 |
Amortization of license fees | 49,011 | 49,011 |
Loss on equity investment | 142,071 | 91,815 |
Accretion of interest on note payable | 19,696 | 11,984 |
Warrant liability gain | (61,597) | (171,833) |
Equity based employee compensation expense | 472,216 | 685,860 |
Equity based payments for outside services | 30,873 | 2,113,003 |
Increase in inventory reserve | 0 | 60,000 |
Increase in assets: | ||
Accounts receivable | (54,499) | (449,461) |
Settlement proceeds receivable | 0 | (600,000) |
Inventory | (440,603) | (377,127) |
Prepaid expenses and other assets | (98,146) | (174,489) |
Increase (decrease) in liabilities: | ||
Accounts payable | 112,862 | (123,334) |
Accrued expenses | (158,219) | 392,123 |
Accrued severance | (112,501) | (30,857) |
Net cash used in operating activities | (5,890,107) | (3,604,029) |
Cash flows from investing activities: | ||
Acquisition of patents and trademarks | (101,004) | (138,871) |
Acquisition machinery and equipment | (20,596) | (4,631) |
Net cash used in investing activities | (121,600) | (143,502) |
Cash flows from financing activities: | ||
Proceeds from exercise of warrants | 196 | 0 |
Stock cancellation | 0 | (34,500) |
Net cash provided by financing activities | 5,091,987 | 5,541,583 |
Net (decrease) increase in cash | (919,720) | 1,794,052 |
Cash - beginning of period | 3,760,297 | 6,402,687 |
Cash - end of period | 2,840,577 | 8,196,739 |
Net cash paid for: | ||
Cash paid during the period for interest | 19,696 | 7,296 |
Cash paid during the period for income taxes | 0 | 0 |
Non-cash transactions: | ||
Patent and trademark additions included in accounts payable | 171,215 | 205,586 |
Machinery and equipment additions included in accounts payable | 0 | 18,000 |
Issuance of common stock in satisfaction of accrued expense | 0 | 325,000 |
June 2015 Registered Direct Offering [Member] | ||
Cash flows from financing activities: | ||
Net proceeds from registered direct offering | 0 | 5,576,083 |
February 2016 Registered Direct Offering [Member] | ||
Cash flows from financing activities: | ||
Net proceeds from registered direct offering | $ 5,091,791 | $ 0 |
NATURE OF BUSINESS AND SUMMARY
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1. - NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation - Operating results for the six months ended June 30, 2016 are not necessarily indicative of the results that may be expected for the year ending December 31, 2016. The balance sheet at December 31, 2015 has been derived from the audited consolidated financial statements at that date, but does not include all of the information and footnotes required by GAAP for complete financial statements. These interim consolidated financial statements should be read in conjunction with the December 31, 2015 audited consolidated financial statements and the notes thereto. Principles of Consolidation - Nature of Business - Reclassifications - Preferred stock authorized - Accounts receivable Inventory - June 30, December 31, Inventory - tobacco leaf $ 1,842,822 $ 1,816,857 Inventory - finished goods Cigarettes and filtered cigars 560,819 342,707 Inventory - raw materials Cigarette and filtered cigar components 853,915 657,389 3,257,556 2,816,953 Less: inventory reserve 110,623 110,623 $ 3,146,933 $ 2,706,330 Fixed assets - Intangible Assets June 30, December 31, Intangible assets, net Patent and trademark costs $ 5,418,778 $ 5,146,559 Less: accumulated amortization 1,805,765 1,603,893 Patent and trademark costs, net 3,613,013 3,542,666 License fees, net (see Note 11) 1,450,000 1,450,000 Less: accumulated amortization 179,557 130,546 License fees, net 1,270,443 1,319,454 MSA signatory costs 2,202,000 2,202,000 License fee for predicate cigarette brand 300,000 300,000 $ 7,385,456 $ 7,364,120 Amortization expense relating to the above intangible assets for the three and six months ended June 30, 2016 amounted to $126,041 and $250,882, respectively ($109,702 and $216,289 for the three and six months ended June 30, 2015, respectively). The estimated annual average amortization expense for the next five years is approximately $359,000 for patent costs and $98,000 for license fees. Impairment of Long-Lived Assets - Income Taxes In light of the Company’s history of cumulative net operating losses and the uncertainty of their future utilization, the Company has established a valuation allowance to fully offset its net deferred tax assets as of June 30, 2016 and December 31, 2015. The Company’s federal and state tax returns for the years ended December 31, 2012 to December 31, 2014 are currently open to audit under the statutes of limitations. There were no pending audits as of June 30, 2016. Stock Based Compensation - Revenue Recognition SPECTRUM MAGIC The Company was chosen to be a subcontractor for a 5-year government contract between RTI International (“RTI”) and the National Institute on Drug Abuse (“NIDA”) to supply NIDA with research cigarettes. These government research cigarettes are distributed under the Company’s mark SPECTRUM SPECTRUM Derivatives Research and Development Advertising Loss Per Common Share - Commitment and Contingency Accounting Use of Estimates Fair Value of Financial Instruments - Equity Investments - Accounting Pronouncements - In August 2014, the FASB issued ASU 2014-15, “Presentation of Financial Statements - Going Concern,” which provides guidance on determining when and how to disclose going-concern uncertainties in the financial statements. The new standard requires management to perform interim and annual assessments of an entity’s ability to continue as a going concern within one year of the date the financial statements are issued. An entity will be required to provide certain disclosures if conditions of events raise substantial doubt about the entity’s ability to continue as a going concern. The ASU applies to all entities and is effective for annual periods ending after December 15, 2016, and interim periods thereafter, with early adoption permitted. We are currently evaluating the impact of the adoption of ASU 2014-15 on our consolidated financial statements and have not yet determined when we will adopt the standard. In February 2016, the FASB issued ASU 2016-02, “Leases,” which supersedes existing lease guidance under GAAP. Under the new guidance, lessees will be required to recognize leases as right of use assets and liabilities for leases with lease terms of more than twelve months. The guidance will apply for both finance and operating leases. The effective date for the ASU is for annual periods beginning after December 15, 2018 and interim periods therein. The Company is currently evaluating the impact of the ASU on its consolidated financial statements. |
FEBRUARY 2016 REGISTERED DIRECT
FEBRUARY 2016 REGISTERED DIRECT OFFERING | 6 Months Ended |
Jun. 30, 2016 | |
FEBRUARY 2016 [Member] | |
Subsidiary, Sale of Stock [Line Items] | |
FEBRUARY 2016 REGISTERED DIRECT OFFERING | NOTE 2. - FEBRUARY 2016 REGISTERED DIRECT OFFERING On February 5, 2016, the Company closed a registered direct offering of common stock and warrants consisting of 5,000,000 2,500,000 1.21 1,940,000 1.10 5,091,791 |
JUNE 2015 REGISTERED DIRECT OFF
JUNE 2015 REGISTERED DIRECT OFFERING | 6 Months Ended |
Jun. 30, 2016 | |
JUNE 2015 [Member] | |
Subsidiary, Sale of Stock [Line Items] | |
JUNE 2015 REGISTERED DIRECT OFFERING | NOTE 3. - JUNE 2015 REGISTERED DIRECT OFFERING On June 2, 2015, the Company closed a registered direct offering of common stock and warrants consisting of 6,000,000 3,000,000 1.25 66 2,067,000 1.00 5,576,083 |
JOINT VENTURE, CONSULTING AGREE
JOINT VENTURE, CONSULTING AGREEMENT AND ASSOCIATED WARRANTS | 6 Months Ended |
Jun. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
JOINT VENTURE, CONSULTING AGREEMENT AND ASSOCIATED WARRANTS | NOTE 4. - JOINT VENTURE, CONSULTING AGREEMENT AND ASSOCIATED WARRANTS On June 22, 2015, the Company terminated its joint venture arrangement with Crede CG III, Ltd. (“Crede”) and a third-party due to non-performance and other breaches of the arrangement by Crede and its principals. The Company also notified Crede that the Company reserved and did not waive, any rights that the Company may have to assert any and all claims that it may have against Crede, its employees, agents, representatives or affiliates thereof, which are allowable by law or in equity, including claims for breach of the warrant agreements entered into with Crede. The six-month Consulting Agreement (the “Consulting Agreement”), entered into with Crede on September 29, 2014, expired on March 29, 2015. The value of the warrants issued in conjunction with the Consulting Agreement in the aggregate amount of $ 4,070,000 1,978,785 Four tranches of warrants were issued to Crede in conjunction with the Consulting Agreement as follows: Tranche 1A warrant to purchase 1,250,000 1,000,000 1,000,000 1,000,000 2,810,000 3.36 The Tranche 2 and Tranche 3 warrants were not exercisable unless and until certain revenue milestones were attained, as defined in the prior joint venture agreement between Crede and the Company. As stated above, the Company terminated the joint venture agreement on June 22, 2015. Accordingly, such revenue milestones will never be satisfied and the Tranche 2 and Tranche 3 warrants will never be exercisable. |
MANUFACTURING FACILITY
MANUFACTURING FACILITY | 6 Months Ended |
Jun. 30, 2016 | |
Manufacturing Facility [Member] | |
Other Operating Income And Expense [Line Items] | |
MANUFACTURING FACILITY | NOTE 5. - MANUFACTURING FACILITY The Company’s manufacturing operations at its North Carolina factory were not at full production capacity during the six months ended June 30, 2016, but the Company continued manufacturing a third-party MSA cigarette brand, filtered cigars on a contract basis, and the Company’s own proprietary cigarette brand, RED SUN 146,669 281,936 152,601 284,119 |
MACHINERY AND EQUIPMENT
MACHINERY AND EQUIPMENT | 6 Months Ended |
Jun. 30, 2016 | |
Property, Plant and Equipment [Abstract] | |
MACHINERY AND EQUIPMENT | NOTE 6. - MACHINERY AND EQUIPMENT June 30, December 31, 2016 2015 Cigarette manufacturing equipment $ 3,016,246 $ 3,016,246 Office furniture, fixtures and equipment 96,882 95,361 Laboratory equipment 19,076 - 3,132,204 3,111,607 Less: accumulated depreciation 717,478 555,814 Machinery and equipment, net $ 2,414,726 $ 2,555,793 Depreciation expense was $81,067 and $ 161,664 157,440 |
EQUITY INVESTMENT
EQUITY INVESTMENT | 6 Months Ended |
Jun. 30, 2016 | |
Equity Method Investments and Joint Ventures [Abstract] | |
EQUITY INVESTMENT | NOTE 7. - EQUITY INVESTMENT On April 11, 2014, the Company, through its wholly-owned subsidiary, Botanical Genetics, entered into an investment agreement (the “Agreement”) with Anandia Laboratories, Inc., a Canadian plant biotechnology company (“Anandia”). The Agreement provided for the Company to make an initial investment of $ 250,000 10 250,000 450,000 15 150,000 394,500 377,906 325,000 The Company uses the equity method of accounting to record its 25 1,080,580 1,222,651 1,199,000 14,412 28,824 25 54,839 142,071 40,834 91,815 |
NOTES PAYABLE AND PATENT ACQUIS
NOTES PAYABLE AND PATENT ACQUISITION | 6 Months Ended |
Jun. 30, 2016 | |
Notes Payable And Patent Acquisition [Abstract] | |
NOTES PAYABLE AND PATENT ACQUISITION | NOTE 8. - NOTES PAYABLE AND PATENT ACQUISITION On December 22, 2014, the Company entered into a Purchase Agreement (the “Purchase Agreement”) with the National Research Council of Canada (“NRC”) to acquire certain patent rights that the Company had previously licensed from NRC under a license agreement between the parties. The Purchase Agreement provided for payment by the Company to NRC for the NRC patent rights a total amount of $ 1,213,000 213,000 1,000,000 333,333 925,730 333,333 628,816 320,878 307,938 616,520 308,582 307,938 1,138,730 |
SEVERANCE LIABILITY
SEVERANCE LIABILITY | 6 Months Ended |
Jun. 30, 2016 | |
Severance Liability [Abstract] | |
SEVERANCE LIABILITY | NOTE 9. - SEVERANCE LIABILITY The Company recorded an accrual for severance during the fourth quarter of 2014 in the initial amount of $ 624,320 18,750 36 212,012 412,308 225,117 90,101 220,661 199,658 |
WARRANTS FOR COMMON STOCK
WARRANTS FOR COMMON STOCK | 6 Months Ended |
Jun. 30, 2016 | |
Warrants For Common Stock [Abstract] | |
WARRANTS FOR COMMON STOCK | NOTE 10. - WARRANTS FOR COMMON STOCK At June 30, 2016, the Company had outstanding warrants to purchase 10,236,621 92,632 10,236,621 On January 25, 2016 warrants to purchase 67,042 2,618 6,831,115 Pursuant to the registered direct offering that closed on February 5, 2016, and discussed in Note 2, the Company issued warrants to purchase 2,500,000 1.21 66 1,940,000 Pursuant to the registered direct offering that closed on June 2, 2015, and discussed in Note 3, the Company issued warrants to purchase 3,000,000 1.25 66 2,067,000 Number of Exercise Warrant Description Warrants Price Expiration December 2011 convertible NP warrants 172,730 $ 1.1984 February 8, 2017 December 2011 convertible NP warrants 802,215 $ 1.3816 February 6, 2018 May 2012 PPO warrants 401,700 $ 0.6000 May 15, 2017 November 2012 PPO warrants 925,100 $ 0.6000 November 9, 2017 August 2012 convertible NP warrants (1) 92,632 $ 0.9520 August 8, 2018 August 2012 convertible NP warrants 92,244 $ 0.9060 August 8, 2018 Crede Tranche 1A warrants 1,250,000 $ 3.3600 September 29, 2016 Crede Tranche 1B warrants 1,000,000 $ 2.5951 September 29, 2016 June 2015 registered direct offering warrants 3,000,000 $ 1.2500 December 2, 2020 (5) February 2016 registered direct offering warrants 2,500,000 $ 1.2100 August 5, 2021 (5) Total warrants outstanding (2),(3),(4) 10,236,621 (1) Includes anti-dilution features. (2) Includes warrants to purchase 533,000 5.2 (3) Includes warrants to purchase 312,730 3.1 (4) Excludes the Crede Tranche 2 and Tranche 3 warrants to purchase 2,000,000 (5) The warrants were terminated on July 27, 2016 (see Note 14 - Subsequent Events for additional information). The Company estimates the value of warrant liability upon issuance of the warrants and at each balance sheet date using the binomial lattice model to allocate total enterprise value to the warrants and other securities in the Company’s capital structure. Volatility was estimated based on historical observed equity volatilities and implied (forward) or expected volatilities for a sample group of guideline companies and consideration of recent market trends. As a result of the previously exercisable exchange rights contained in the Tranche 1A warrants, the financial instrument was previously considered a liability in accordance with FASB Accounting Standards Codification Topic 480 - “Distinguishing Liabilities from Equity” (“ASC 480”). More specifically, ASC 480 requires a financial instrument to be classified as a liability if such financial instrument contains a conditional obligation that the issuer must or may settle by issuing a variable number of its equity securities if, at inception, the monetary value of the obligation is based on a known fixed monetary amount. As a result of the actions by Crede that caused the exchange rights feature to be voided, the Company reclassified the Tranche 1A warrant liability to Capital in excess of par. Fair value at December 31, 2013 $ 3,779,522 Reclassification of warrant liability to equity resulting from Warrant Amendments - Q1 2014 (7,367,915) Cost of inducement from Warrant Amendments - Q1 2014 144,548 Fair value of warrant liability resulting from issuance of Crede Tranche 1A Warrants - Q3 2014 2,810,000 Loss as a result of change in fair value 3,676,691 Fair value at December 31, 2014 $ 3,042,846 Gain as a result of change in fair value (144,550) Fair value at December 31, 2015 $ 2,898,296 Reclassification of warrant liability to capital in excess of par (2,810,000) Gain as a result of change in fair value (61,597) Fair value at June 30, 2016 $ 26,699 The aggregate net (loss) gain as a result of the Company’s warrant liability for the three and six months ended June 30, 2016 amounted to ($9,468) and $ 61,597 112,620 171,833 FASB ASC 820 - “Fair Value Measurements and Disclosures” establishes a valuation hierarchy for disclosure of the inputs to valuation used to measure fair value. This hierarchy prioritizes the inputs into three broad levels as follows: · Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities; · Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument; and · Level 3 inputs are unobservable inputs based on the Company’s own assumptions used to measure assets and liabilities at fair value. A financial asset’s or a financial liability’s classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. The warrant liability is measured at fair value using certain estimated factors such as volatility and probability which are classified within Level 3 of the valuation hierarchy. Significant unobservable inputs that are used in the fair value measurement of the Company’s derivative warrant liabilities include volatility. Significant increases (decreases) in the volatility input would result in a significantly higher (lower) fair value measurement. Number of Warrants outstanding at December 31, 2013 10,653,469 Warrants issued in conjunction with consulting agreement 4,250,000 Warrants exercised during 2014 (1,247,443) Additional warrants due to anti-dilution provisions 18,383 Warrants outstanding at December 31, 2014 13,674,409 Warrants issued in conjunction with registered direct offering 3,000,000 Warrants exercised during 2015 (40,000) Additional warrants due to anti-dilution provisions 369 Warrants outstanding at December 31, 2015 16,634,778 Warrants issued in conjunction with registered direct offering 2,500,000 Unexercisable warrants (1) (2,000,000) Warrants exercised during January 2016 (67,042) Warrants expired during January 2016 (6,831,115) Warrants outstanding at June 30, 2016 10,236,621 Composition of outstanding warrants: Warrants containing anti-dilution feature 92,632 Warrants without anti-dilution feature 10,143,989 10,236,621 (1) Crede Tranche 2 Warrants and Tranche 3 Warrants are not exercisable (see Note 4 for additional discussion). |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 11. - COMMITMENTS AND CONTINGENCIES License Agreements - Under its exclusive worldwide license agreement with North Carolina State University (“NCSU”), the Company is required to pay minimum annual royalty payments, which are credited against running royalties on sales of licensed products. The minimum annual royalty for 2015 was $ 75,000 225,000 150,000 10,016 13,996 6,278 23,606 On December 8, 2015, the Company entered into an additional license agreement (the “License”) with NCSU. Under the terms of the License, the Company paid NCSU a non-refundable, non-creditable lump sum license fee of $ 150,000 10,000 15,000 25,000 50,000 0 6,075 0 On February 10, 2014, the Company entered into a sponsored research and development agreement (the “Agreement”) with NCSU. Under the terms of the Agreement, the Company paid NCSU $ 162,408 85,681 All payments made under the above referenced license agreements and the sponsored research and development agreement are initially recorded as a Prepaid expense on the Company’s Consolidated Balance Sheets and subsequently expensed on a straight-line basis over the applicable period and included in Research and development costs on the Company’s Consolidated Statements of Operations. The amounts expensed during the three and six months ended June 30, 2016 were $ 115,170 229,967 39,051 78,102 On August 22, 2014, the Company entered into a Commercial License Agreement with Precision PlantSciences, Inc. (the “Precision License”). The Precision License grants the Company a non-exclusive, but fully paid up right and license to use technology and materials owned by Precision PlantSciences for a license fee of $ 1,250,000 725,000 525,000 25,000 525,000 On August 27, 2014, the Company entered into an additional exclusive License Agreement (the “License Agreement”) with NCSU. Under the License Agreement, the Company paid NCSU a non-refundable, non-creditable lump sum license fee of $ 125,000 15,000 20,000 30,000 50,000 5,983 33,939 522 4,204 On September 15, 2014, the Company entered into a Sublicense Agreement with Anandia Laboratories, Inc. (the “Anandia Sublicense”). Under the terms of the Anandia Sublicense, the Company was granted an exclusive sublicense in the United States and a co-exclusive sublicense in the remainder of the world, excluding Canada, to the licensed Intellectual Property (more fully discussed in Note 7). The Anandia Sublicense calls for an up-front fee of $ 75,000 10,000 The Precision License, the License Agreement with NCSU and the Anandia Sublicense are included in Intangible assets, net in the Company’s Consolidated Balance Sheets and the applicable license fees will be amortized over the term of the agreements based on their last-to-expire patent date. Amortization during the three and six months ended June 30, 2016 amounted to $ 24,505 49,011 24,506 49,011 On September 28, 2015, the Company’s wholly-owned subsidiary, Botanical Genetics, entered into a Sponsored Research Agreement (the “Agreement”) with Anandia Laboratories Inc. (“Anandia”). Pursuant to the Agreement, Anandia will conduct research on behalf of the Company relating to the cannabis plant. The Agreement has an initial term of twelve (12) months from the date of the Agreement and can be extended at the sole option of the Company for two (2) additional periods of twelve (12) months each. The Company will pay Anandia $ 379,800 295,600 84,200 84,200 179,200 0 Lease Agreements - The Company leases a manufacturing facility and warehouse located in North Carolina on a triple net lease basis. The lease commenced on January 14, 2014, and had an initial term of twelve (12) months. The lease contains four (4) additional extensions; with one lease extension being for an additional one (1) year and with the other three (3) lease extensions each being for an additional two (2) years in duration, exercisable at the option of the Company. The Company is currently in the one-year lease extension term that will expire on October 31, 2016. The lease expense for the three and six months ended June 30, 2016 amounted to $ 36,131 72,262 30,750 61,500 Year ended December 31, 2016 - $ 74,000 Year ended December 31, 2017 - $ 156,000 Year ended December 31, 2018 - $ 169,000 Year ended December 31, 2019 - $ 169,000 Year ended December 31, 2020 - $ 169,000 Year ended December 31, 2021 - $ 141,000 The Company has a lease for its office space in Clarence, New York that expires on August 31, 2016, with the Company having the option to extend this lease for an additional one-year renewal period expiring on August 31, 2017. Future minimum lease payments for the years ended December 31, 2016 and 2017 are approximately $ 23,000 31,000 On November 1, 2015, the Company entered into a one-year lease for 25,000 3,750 22,500 45,000 45,000 37,500 On May 1, 2016, the Company entered into a sublease for laboratory space in Buffalo, New York. The sublease calls for a monthly payment of $ 1,471 8,800 18,000 6,000 Litigation - In accordance with applicable accounting guidance, the Company establishes an accrued liability for litigation and regulatory matters when those matters present loss contingencies that are both probable and estimable. In such cases, there may be an exposure to loss in excess of any amounts accrued. When a loss contingency is not both probable and estimable, the Company does not establish an accrued liability. As a litigation or regulatory matter develops, the Company, in conjunction with any outside counsel handling the matter, evaluates on an ongoing basis whether such matter presents a loss contingency that is probable and estimable. If, at the time of evaluation, the loss contingency related to a litigation or regulatory matter is not both probable and estimable, the matter will continue to be monitored for further developments that would make such loss contingency both probable and estimable. When a loss contingency related to a litigation or regulatory matter is deemed to be both probable and estimable, the Company will establish an accrued liability with respect to such loss contingency and record a corresponding amount of litigation-related expense. The Company will then continue to monitor the matter for further developments that could affect the amount of any such accrued liability. On April 26, 2016, Crede CG III, LTD. (“Crede”) filed a complaint against the Company in the United States District Court for the Southern District of New York (the “SDNY Court”) entitled Crede CG III, LTD. v. 22nd Century Group, Inc On May 19, 2016, Crede filed a motion for preliminary injunction, asking the SDNY Court to require the Company to issue 2,077,555 Following such ruling, the SDNY Court directed the parties to file briefs on the pending letter motion to transfer certain claims to the WDNY Court. On July 11, 2016, the Company filed its formal motion to sever the Crede lawsuit into two separate cases, with all claims relating to the Tranche 1A Warrant to stay in the SDNY Court, and with the claims relating to the China joint venture agreement and the securities purchase agreement to be transferred to WDNY Court, where the Company’s headquarters is located. On July 29, 2016, Crede filed its response to the Company’s motion and on August 5, 2016, the Company filed its reply to Crede’s response. We expect the SDNY Court to conduct a telephonic hearing on the motion in August 2016. |
EARNINGS PER COMMON SHARE
EARNINGS PER COMMON SHARE | 6 Months Ended |
Jun. 30, 2016 | |
Earnings Per Common Share [Abstract] | |
EARNINGS PER COMMON SHARE | NOTE 12. - EARNINGS PER COMMON SHARE June 30, June 30, 2016 2015 Net loss attributed to common shareholders $ (2,902,354) $ (1,288,703) Denominator for basic earnings per share-weighted average shares outstanding 76,024,064 66,616,739 Effect of dilutive securities: Warrants, restricted stock and options outstanding - - Denominator for diluted earnings per common share-weighted average shares adjusted for dilutive securities 76,024,064 66,616,739 Loss per common share - basic and diluted $ (0.04) $ (0.02) June 30, June 30, 2016 2015 Net loss attributed to common shareholders $ (6,154,806) $ (5,405,442) Denominator for basic earnings per share-weighted average shares outstanding 75,027,606 65,408,908 Effect of dilutive securities: Warrants, restricted stock and options outstanding - - Denominator for diluted earnings per common share-weighted average shares adjusted for dilutive securities 75,027,606 65,408,908 Loss per common share - basic and diluted $ (0.08) $ (0.08) June 30, June 30, 2016 2015 Warrants 10,236,621 16,674,778 Restricted stock - 100,000 Options 4,985,679 2,661,642 15,222,300 19,436,420 |
EQUITY BASED COMPENSATION
EQUITY BASED COMPENSATION | 6 Months Ended |
Jun. 30, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
STOCK BASED COMPENSATION | NOTE 13. - EQUITY BASED COMPENSATION On October 21, 2010, the Company established the 2010 Equity Incentive Plan (“EIP”) for officers, employees, directors, consultants and advisors to the Company and its affiliates, which consisted of 4,250,000 850,000 On April 12, 2014, the stockholders of the Company approved the 22nd Century Group, Inc. 2014 Omnibus Incentive Plan (the “OIP”). The OIP allows for the granting of equity and cash incentive awards to eligible individuals over the life of the OIP, including the issuance of up to 5,000,000 During the three and six months ended June 30, 2016, the Company issued stock option awards from the OIP for 90,000 1,724,037 61,643 20,000 1,559,999 For the three and six months ended June 30, 2016 the Company recorded compensation expense related to restricted stock and stock option awards granted under the EIP and OIP of $ 212,222 472,216 331,773 685,860 10,000 15,811 100,000 189,196 100,000 8,000 30,873 25,885 134,218 As of June 30, 2016, unrecognized compensation expense related to non-vested restricted shares and stock options amounted to approximately $ 1,327,000 371,000 362,000 272,000 48,000 274,000 2016 2015 Risk-free interest rate (weighted average) 1.38 % 1.50 % Expected dividend yield 0 % 0 % Expected stock price volatility 90 % 90 % Expected life of options (weighted average) 5.03 years 8.66 years The Company estimated the expected volatility based on data used by a peer group of public companies. The expected term was estimated using the contract life of the option. The risk-free interest rate assumption was determined using yield of the equivalent U.S. Treasury bonds over the expected term. The Company has never paid any cash dividends and does not anticipate paying any cash dividends in the foreseeable future. Therefore, the Company assumed an expected dividend yield of zero. A Number of Weighted Weighted Aggregate Outstanding at December 31, 2013 660,000 $ 0.74 Granted in 2014 300,000 $ 2.61 Exercised in 2014 (70,000) $ 0.69 Outstanding at December 31, 2014 890,000 $ 1.38 Reinstated in 2015 50,000 $ 0.69 Granted in 2015 2,221,642 $ 1.00 Outstanding at December 31, 2015 3,161,642 $ 1.10 Granted in 2016 1,824,037 $ 0.94 Outstanding at June 30, 2016 4,985,679 $ 1.04 7.7 years $ 92,450 Exercisable at June 30, 2016 2,511,642 $ 1.15 7.1 years $ 56,950 There were stock options granted during the six months ended June 30, 2016 and 2015, to purchase a total of 1,824,037 1,721,642 0.64 0.59 1,138,910 206,500 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2016 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 14. - SUBSEQUENT EVENTS On July 27, 2016, the Company closed a registered direct offering of units, with each unit consisting of one share of common stock and a warrant to purchase 1.141 0.81 5.0 6,172,840 7,043,211 1.00 1,543,210 858,000 5,500,001 3,058,000 5.5 4.99 st 9.99 1.15 5.5 1.21 1.25 |
NATURE OF BUSINESS AND SUMMAR22
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation - The accompanying unaudited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial information and with the instructions to Form 10-Q. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments consisting of normal recurring accruals considered necessary for a fair and non-misleading presentation of the financial statements have been included. Operating results for the six months ended June 30, 2016 are not necessarily indicative of the results that may be expected for the year ending December 31, 2016. The balance sheet at December 31, 2015 has been derived from the audited consolidated financial statements at that date, but does not include all of the information and footnotes required by GAAP for complete financial statements. These interim consolidated financial statements should be read in conjunction with the December 31, 2015 audited consolidated financial statements and the notes thereto. |
Principles of Consolidation | Principles of Consolidation - The accompanying consolidated financial statements include the accounts of 22nd Century Group, Inc. (“22nd Century Group”), its three wholly-owned subsidiaries, 22nd Century Limited, LLC (“22nd Century Ltd”), NASCO Products, LLC (“NASCO”), and Botanical Genetics, LLC (“Botanical Genetics”), and two wholly-owned subsidiaries of 22nd Century Ltd, Goodrich Tobacco Company, LLC (“Goodrich Tobacco”) and Hercules Pharmaceuticals, LLC (“Hercules Pharma”) (collectively, “the Company”). All intercompany accounts and transactions have been eliminated. |
Nature of Business | Nature of Business - 22nd Century Ltd is a plant biotechnology company specializing in technology that allows for the level of nicotine and other nicotinic alkaloids (e.g., nornicotine, anatabine and anabasine) in tobacco plants to be decreased or increased through genetic engineering and plant breeding. The Company currently owns or exclusively controls more than 200 issued patents and more than 50 pending patent applications around the world. Goodrich Tobacco and Hercules Pharma are business units for the Company’s (i) premium cigarettes and potential modified risk tobacco products and (ii) smoking cessation product, respectively. The Company acquired the membership interests of NASCO on August 29, 2014. NASCO is a federally licensed tobacco products manufacturer, a participating member of the tobacco Master Settlement Agreement (“MSA”) between the tobacco industry and the Settling States under the MSA, and operates the Company’s cigarette manufacturing business in North Carolina. Botanical Genetics is a wholly-owned subsidiary of 22nd Century Group, and was incorporated to facilitate an equity investment more fully described in Note 7. |
Reclassifications | Reclassifications - Certain items in the 2015 financial statements have been reclassified to conform to the 2016 classification. |
Preferred stock authorized | Preferred stock authorized - The Company is authorized to issue “blank check” preferred stock, which could be issued with voting, liquidation, dividend and other rights superior to our common stock. |
Accounts receivable | Accounts receivable |
Inventory | Inventory - Inventories are valued at the lower of cost or market. Cost is determined using an average cost method for tobacco leaf inventory and the first-in, first-out (FIFO) method on all other inventories. Inventories are evaluated to determine whether any amounts are not recoverable based on slow moving or obsolete condition and are written off or reserved as appropriate. June 30, December 31, Inventory - tobacco leaf $ 1,842,822 $ 1,816,857 Inventory - finished goods Cigarettes and filtered cigars 560,819 342,707 Inventory - raw materials Cigarette and filtered cigar components 853,915 657,389 3,257,556 2,816,953 Less: inventory reserve 110,623 110,623 $ 3,146,933 $ 2,706,330 |
Fixed assets | Fixed assets - |
Intangible Assets | Intangible Assets - Intangible assets are recorded at cost and consist primarily of (1) expenditures incurred with third parties related to the processing of patent claims and trademarks with government authorities, as well as costs to acquire patent rights from third parties, (2) license fees paid for third-party intellectual property, (3) costs to become a signatory under the tobacco MSA, and (4) license fees paid to acquire a predicate cigarette brand. The amounts capitalized relate to intellectual property that the Company owns or to which it has exclusive rights. The Company’s intellectual property capitalized costs are amortized using the straight-line method over the remaining statutory life of the primary patent in each of the Company’s two primary patent families, which expire in 2019 and 2028 (the assets’ estimated lives, respectively). Periodic maintenance or renewal fees are expensed as incurred. Annual minimum license fees are charged to expense. License fees paid for third-party intellectual property are amortized on a straight-line basis over the last to expire patents, which patent expiration dates range from 2028 through 2035. The Company believes costs associated with becoming a signatory to the MSA and acquiring the predicate cigarette brand have an indefinite life and as such, no amortization is taken. June 30, December 31, Intangible assets, net Patent and trademark costs $ 5,418,778 $ 5,146,559 Less: accumulated amortization 1,805,765 1,603,893 Patent and trademark costs, net 3,613,013 3,542,666 License fees, net (see Note 11) 1,450,000 1,450,000 Less: accumulated amortization 179,557 130,546 License fees, net 1,270,443 1,319,454 MSA signatory costs 2,202,000 2,202,000 License fee for predicate cigarette brand 300,000 300,000 $ 7,385,456 $ 7,364,120 Amortization expense relating to the above intangible assets for the three and six months ended June 30, 2016 amounted to $ 126,041 250,882 109,702 216,289 The estimated annual average amortization expense for the next five years is approximately $ 359,000 98,000 |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets - |
Income Taxes | Income Taxes - The Company recognizes deferred tax assets and liabilities for any basis differences in its assets and liabilities between tax and GAAP reporting, and for operating loss and credit carry-forwards. In light of the Company’s history of cumulative net operating losses and the uncertainty of their future utilization, the Company has established a valuation allowance to fully offset its net deferred tax assets as of June 30, 2016 and December 31, 2015. The Company’s federal and state tax returns for the years ended December 31, 2012 to December 31, 2014 are currently open to audit under the statutes of limitations. There were no pending audits as of June 30, 2016. |
Stock Based Compensation | Stock Based Compensation - The Company uses a fair-value based method to determine compensation for all arrangements under which Company employees and others receive shares or options to purchase common shares of the Company. Stock based compensation expense is recorded over the requisite service period based on estimates of probability and time of achieving milestones and vesting. For accounting purposes, the shares will be considered issued and outstanding upon vesting. |
Revenue Recognition | Revenue Recognition - The Company recognizes revenue from product sales at the point the product is shipped to a customer and title has transferred. Revenue from the sale of the Company’s products is recognized net of cash discounts, sales returns and allowances. Cigarette and filtered cigar federal excise taxes and other regulatory fees in the approximate amount of $ 1,842,000 3,577,000 1,603,000 1,928,000 SPECTRUM MAGIC The Company was chosen to be a subcontractor for a 5-year government contract between RTI International (“RTI”) and the National Institute on Drug Abuse (“NIDA”) to supply NIDA with research cigarettes. These government research cigarettes are distributed under the Company’s mark SPECTRUM 5.0 SPECTRUM 40 242,658 329,321 |
Derivatives | Derivatives - The Company does not use derivative instruments to hedge exposures to cash flow, market or foreign currency risks. The Company evaluates all of our financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair market value and then is revalued at each reporting date, with changes in fair value reported in the Consolidated Statements of Operations. The methodology for valuing our outstanding warrants classified as derivative instruments utilizes a lattice model approach which includes probability weighted estimates of future events, including volatility of our common stock. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or equity, is evaluated at the end of each reporting period. Derivative instrument liabilities are classified on the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within twelve months of the balance sheet date. |
Research and Development | Research and Development - Research and development costs are expensed as incurred. |
Advertising | Advertising 27,000 235,000 64,000 115,000 |
Loss Per Common Share | - Basic loss per common share is computed using the weighted-average number of common shares outstanding. Diluted loss per share is computed assuming conversion of all potentially dilutive securities. Potential common shares outstanding are excluded from the computation if their effect is anti-dilutive. |
Commitment and Contingency Accounting | Commitment and Contingency Accounting - The Company evaluates each commitment and/or contingency in accordance with the accounting standards, which state that if the item is more likely than not to become a direct liability, then the Company will record the liability in the financial statements. If not, the Company will disclose any material commitments or contingencies that may arise. |
Use of Estimates | Use of Estimates - The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. 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 income and expenses during the reporting period. Actual results could differ from those estimates. |
Fair value of financial instruments | Fair Value of Financial Instruments - Financial instruments include cash, receivables, accounts payable, accrued expenses, accrued severance, note payable and warrant liability. Other than warrant liability, fair value is assumed to approximate carrying values for these financial instruments, since they are short term in nature, they are receivable or payable on demand, or had stated interest rates that approximate the interest rates available to the Company as of the reporting date. The determination of the fair value of the warrant liability includes unobservable inputs and is therefore categorized as a Level 3 measurement, as further discussed in Note 10. |
Equity Investments | Equity Investments - The Company accounts for investments in equity securities of other entities under the equity method of accounting if the Company’s investment in the voting stock is greater than or equal to 20% and less than a majority, and the Company has the ability to have significant influence over the operating and financial policies of the investee. |
Accounting Pronouncements | Accounting Pronouncements In August 2014, the FASB issued ASU 2014-15, “Presentation of Financial Statements - Going Concern,” which provides guidance on determining when and how to disclose going-concern uncertainties in the financial statements. The new standard requires management to perform interim and annual assessments of an entity’s ability to continue as a going concern within one year of the date the financial statements are issued. An entity will be required to provide certain disclosures if conditions of events raise substantial doubt about the entity’s ability to continue as a going concern. The ASU applies to all entities and is effective for annual periods ending after December 15, 2016, and interim periods thereafter, with early adoption permitted. We are currently evaluating the impact of the adoption of ASU 2014-15 on our consolidated financial statements and have not yet determined when we will adopt the standard. In February 2016, the FASB issued ASU 2016-02, “Leases,” which supersedes existing lease guidance under GAAP. Under the new guidance, lessees will be required to recognize leases as right of use assets and liabilities for leases with lease terms of more than twelve months. The guidance will apply for both finance and operating leases. The effective date for the ASU is for annual periods beginning after December 15, 2018 and interim periods therein. The Company is currently evaluating the impact of the ASU on its consolidated financial statements. |
NATURE OF BUSINESS AND SUMMAR23
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Inventory, Current | Inventories at June 30, 2016 and December 31, 2015 consisted of the following: June 30, December 31, Inventory - tobacco leaf $ 1,842,822 $ 1,816,857 Inventory - finished goods Cigarettes and filtered cigars 560,819 342,707 Inventory - raw materials Cigarette and filtered cigar components 853,915 657,389 3,257,556 2,816,953 Less: inventory reserve 110,623 110,623 $ 3,146,933 $ 2,706,330 |
Schedule of Intangible Assets and Goodwill | Total intangible assets at June 30, 2016 and December 31, 2015 consisted of the following: June 30, December 31, Intangible assets, net Patent and trademark costs $ 5,418,778 $ 5,146,559 Less: accumulated amortization 1,805,765 1,603,893 Patent and trademark costs, net 3,613,013 3,542,666 License fees, net (see Note 11) 1,450,000 1,450,000 Less: accumulated amortization 179,557 130,546 License fees, net 1,270,443 1,319,454 MSA signatory costs 2,202,000 2,202,000 License fee for predicate cigarette brand 300,000 300,000 $ 7,385,456 $ 7,364,120 |
MACHINERY AND EQUIPMENT (Tables
MACHINERY AND EQUIPMENT (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Property, Plant and Equipment [Abstract] | |
MACHINERY AND EQUIPMENT | Machinery and equipment at June 30, 2016 and December 31, 2015 consisted of the following: June 30, December 31, 2016 2015 Cigarette manufacturing equipment $ 3,016,246 $ 3,016,246 Office furniture, fixtures and equipment 96,882 95,361 Laboratory equipment 19,076 - 3,132,204 3,111,607 Less: accumulated depreciation 717,478 555,814 Machinery and equipment, net $ 2,414,726 $ 2,555,793 |
WARRANTS FOR COMMON STOCK (Tabl
WARRANTS FOR COMMON STOCK (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Warrants For Common Stock [Abstract] | |
Schedule Of Warrants Outstanding | Outstanding warrants at June 30, 2016 consisted of the following: Number of Exercise Warrant Description Warrants Price Expiration December 2011 convertible NP warrants 172,730 $ 1.1984 February 8, 2017 December 2011 convertible NP warrants 802,215 $ 1.3816 February 6, 2018 May 2012 PPO warrants 401,700 $ 0.6000 May 15, 2017 November 2012 PPO warrants 925,100 $ 0.6000 November 9, 2017 August 2012 convertible NP warrants (1) 92,632 $ 0.9520 August 8, 2018 August 2012 convertible NP warrants 92,244 $ 0.9060 August 8, 2018 Crede Tranche 1A warrants 1,250,000 $ 3.3600 September 29, 2016 Crede Tranche 1B warrants 1,000,000 $ 2.5951 September 29, 2016 June 2015 registered direct offering warrants 3,000,000 $ 1.2500 December 2, 2020 (5) February 2016 registered direct offering warrants 2,500,000 $ 1.2100 August 5, 2021 (5) Total warrants outstanding (2),(3),(4) 10,236,621 (1) Includes anti-dilution features. (2) Includes warrants to purchase 533,000 5.2 (3) Includes warrants to purchase 312,730 3.1 (4) Excludes the Crede Tranche 2 and Tranche 3 warrants to purchase 2,000,000 (5) The warrants were terminated on July 27, 2016 (see Note 14 - Subsequent Events for additional information). |
Roll-Forward of Warrant Liability from Intitial Valuation | The following table is a roll-forward summary of the warrant liability: Fair value at December 31, 2013 $ 3,779,522 Reclassification of warrant liability to equity resulting from Warrant Amendments - Q1 2014 (7,367,915) Cost of inducement from Warrant Amendments - Q1 2014 144,548 Fair value of warrant liability resulting from issuance of Crede Tranche 1A Warrants - Q3 2014 2,810,000 Loss as a result of change in fair value 3,676,691 Fair value at December 31, 2014 $ 3,042,846 Gain as a result of change in fair value (144,550) Fair value at December 31, 2015 $ 2,898,296 Reclassification of warrant liability to capital in excess of par (2,810,000) Gain as a result of change in fair value (61,597) Fair value at June 30, 2016 $ 26,699 |
Warrant Activity | The following table summarizes the Company’s warrant activity since December 31, 2013: Number of Warrants outstanding at December 31, 2013 10,653,469 Warrants issued in conjunction with consulting agreement 4,250,000 Warrants exercised during 2014 (1,247,443) Additional warrants due to anti-dilution provisions 18,383 Warrants outstanding at December 31, 2014 13,674,409 Warrants issued in conjunction with registered direct offering 3,000,000 Warrants exercised during 2015 (40,000) Additional warrants due to anti-dilution provisions 369 Warrants outstanding at December 31, 2015 16,634,778 Warrants issued in conjunction with registered direct offering 2,500,000 Unexercisable warrants (1) (2,000,000) Warrants exercised during January 2016 (67,042) Warrants expired during January 2016 (6,831,115) Warrants outstanding at June 30, 2016 10,236,621 Composition of outstanding warrants: Warrants containing anti-dilution feature 92,632 Warrants without anti-dilution feature 10,143,989 10,236,621 (1) Crede Tranche 2 Warrants and Tranche 3 Warrants are not exercisable (see Note 4 for additional discussion). |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases | The future minimum lease payments if the Company exercises each of the additional extensions are approximately as follows: Year ended December 31, 2016 - $ 74,000 Year ended December 31, 2017 - $ 156,000 Year ended December 31, 2018 - $ 169,000 Year ended December 31, 2019 - $ 169,000 Year ended December 31, 2020 - $ 169,000 Year ended December 31, 2021 - $ 141,000 |
EARNINGS PER COMMON SHARE (Tabl
EARNINGS PER COMMON SHARE (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Earnings Per Common Share [Abstract] | |
Computation of Basic and Diluted Earnings Per Common Share | June 30, June 30, 2016 2015 Net loss attributed to common shareholders $ (2,902,354) $ (1,288,703) Denominator for basic earnings per share-weighted average shares outstanding 76,024,064 66,616,739 Effect of dilutive securities: Warrants, restricted stock and options outstanding - - Denominator for diluted earnings per common share-weighted average shares adjusted for dilutive securities 76,024,064 66,616,739 Loss per common share - basic and diluted $ (0.04) $ (0.02) June 30, June 30, 2016 2015 Net loss attributed to common shareholders $ (6,154,806) $ (5,405,442) Denominator for basic earnings per share-weighted average shares outstanding 75,027,606 65,408,908 Effect of dilutive securities: Warrants, restricted stock and options outstanding - - Denominator for diluted earnings per common share-weighted average shares adjusted for dilutive securities 75,027,606 65,408,908 Loss per common share - basic and diluted $ (0.08) $ (0.08) |
Schedule Outstanding Excluded from Computation Because they would have bee Anti-dilutive | Securities outstanding that were excluded from the computation because they would have been anti-dilutive are as follows: June 30, June 30, 2016 2015 Warrants 10,236,621 16,674,778 Restricted stock - 100,000 Options 4,985,679 2,661,642 15,222,300 19,436,420 |
EQUITY BASED COMPENSATION (Tabl
EQUITY BASED COMPENSATION (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Fair Value Assumptions | The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model. The following assumptions were used for the six months ended June 30, 2016 and 2015: 2016 2015 Risk-free interest rate (weighted average) 1.38 % 1.50 % Expected dividend yield 0 % 0 % Expected stock price volatility 90 % 90 % Expected life of options (weighted average) 5.03 years 8.66 years |
Summary of All Stock Option Activity | A Number of Weighted Weighted Aggregate Outstanding at December 31, 2013 660,000 $ 0.74 Granted in 2014 300,000 $ 2.61 Exercised in 2014 (70,000) $ 0.69 Outstanding at December 31, 2014 890,000 $ 1.38 Reinstated in 2015 50,000 $ 0.69 Granted in 2015 2,221,642 $ 1.00 Outstanding at December 31, 2015 3,161,642 $ 1.10 Granted in 2016 1,824,037 $ 0.94 Outstanding at June 30, 2016 4,985,679 $ 1.04 7.7 years $ 92,450 Exercisable at June 30, 2016 2,511,642 $ 1.15 7.1 years $ 56,950 |
NATURE OF BUSINESS AND SUMMAR29
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Narrative) (Details) Cigarettes in Millions | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Jan. 31, 2016USD ($) | Sep. 30, 2015Cigarettes | Jun. 30, 2016USD ($) | Dec. 31, 2015USD ($) | Jun. 30, 2015USD ($) | Jun. 30, 2016USD ($) | Jun. 30, 2015USD ($) | Dec. 31, 2015USD ($) | |
Condensed Financial Statements, Captions [Line Items] | ||||||||
Amortization of Intangible Assets | $ 126,041 | $ 109,702 | $ 250,882 | $ 216,289 | ||||
Sales Revenue, Goods, Net, Total | $ 329,321 | 2,827,658 | $ 242,658 | 2,306,953 | 5,846,714 | 2,923,091 | ||
Allowance for Doubtful Accounts Receivable | 10,000 | $ 10,000 | 10,000 | $ 10,000 | ||||
Advertising Expense | 27,000 | 64,000 | 235,000 | 115,000 | ||||
Excise and Sales Taxes | 1,842,000 | $ 1,603,000 | 3,577,000 | $ 1,928,000 | ||||
Percentage of Orders Shipped | 40.00% | |||||||
Patent and Trademarks [Member] | ||||||||
Condensed Financial Statements, Captions [Line Items] | ||||||||
Finite-Lived Intangible Assets, Amortization Expense, after Year Five | 359,000 | 359,000 | ||||||
Licensing Agreements [Member] | ||||||||
Condensed Financial Statements, Captions [Line Items] | ||||||||
Finite-Lived Intangible Assets, Amortization Expense, after Year Five | $ 98,000 | $ 98,000 | ||||||
Maximum [Member] | ||||||||
Condensed Financial Statements, Captions [Line Items] | ||||||||
Property, Plant and Equipment, Estimated Useful Lives | 10 | |||||||
Minimum [Member] | ||||||||
Condensed Financial Statements, Captions [Line Items] | ||||||||
Property, Plant and Equipment, Estimated Useful Lives | 3 | |||||||
SPECTRUM Order [Member] | ||||||||
Condensed Financial Statements, Captions [Line Items] | ||||||||
Purchase Order Received During Period | Cigarettes | 5 |
NATURE OF BUSINESS AND SUMMAR30
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) | Jun. 30, 2016 | Dec. 31, 2015 |
Inventory [Line Items] | ||
Inventory - tobacco leaf | $ 1,842,822 | $ 1,816,857 |
Inventory - finished goods | ||
Cigarettes and filtered cigars | 560,819 | 342,707 |
Inventory - raw materials | ||
Cigarette and filtered cigar components | 853,915 | 657,389 |
Inventory - tobacco leaf, net | 3,257,556 | 2,816,953 |
Less: inventory reserve | 110,623 | 110,623 |
Inventory, Net | $ 3,146,933 | $ 2,706,330 |
NATURE OF BUSINESS AND SUMMAR31
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) - USD ($) | Jun. 30, 2016 | Dec. 31, 2015 |
Intangible assets, net | ||
Intangible assets, net | $ 7,385,456 | $ 7,364,120 |
Patent and Trademark [Member] | ||
Intangible assets, net | ||
Patent and trademark costs, License fees | 5,418,778 | 5,146,559 |
Less: accumulated amortization | 1,805,765 | 1,603,893 |
Patent and trademark costs, License fees, net | 3,613,013 | 3,542,666 |
Licensing Agreements [Member] | ||
Intangible assets, net | ||
Patent and trademark costs, License fees | 1,450,000 | 1,450,000 |
Less: accumulated amortization | 179,557 | 130,546 |
Patent and trademark costs, License fees, net | 1,270,443 | 1,319,454 |
MSA Signatory Costs [Member] | ||
Intangible assets, net | ||
MSA signatory costs, License fee for predicate cigarette brand | 2,202,000 | 2,202,000 |
License Fees, Net [Member] | ||
Intangible assets, net | ||
MSA signatory costs, License fee for predicate cigarette brand | $ 300,000 | $ 300,000 |
FEBRUARY 2016 REGISTERED DIRE32
FEBRUARY 2016 REGISTERED DIRECT OFFERING (Narrative) (Details) - USD ($) | Feb. 05, 2016 | Jan. 25, 2016 | Jun. 30, 2016 |
Direct Offering [Line Items] | |||
Stock Issued During Period, Shares, New Issues | 2,618 | ||
Stock Issued During Period, Value, New Issues | $ 5,091,791 | ||
February Offering [Member] | |||
Direct Offering [Line Items] | |||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1.21 | ||
Stock Issued During Period, Value, New Issues | $ 5,091,791 | ||
Warrants Expiration Period | 66 months | ||
Shares Issued, Price Per Share | $ 1.10 | ||
Fair Value of Warrants | $ 1,940,000 | ||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 2,500,000 | ||
Common Stock [Member] | |||
Direct Offering [Line Items] | |||
Stock Issued During Period, Shares, New Issues | 5,000,000 | ||
Stock Issued During Period, Value, New Issues | $ 50 | ||
Common Stock [Member] | February Offering [Member] | |||
Direct Offering [Line Items] | |||
Stock Issued During Period, Shares, New Issues | 5,000,000 |
JUNE 2015 REGISTERED DIRECT O33
JUNE 2015 REGISTERED DIRECT OFFERING (Narrative) (Details) - USD ($) | 1 Months Ended | 6 Months Ended | |
Jan. 25, 2016 | Jun. 02, 2015 | Jun. 30, 2016 | |
Direct Offering [Line Items] | |||
Stock Issued During Period, Shares, New Issues | 2,618 | ||
Stock Issued During Period, Value, New Issues | $ 5,091,791 | ||
June Offering [Member] | |||
Direct Offering [Line Items] | |||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1.25 | ||
Stock Issued During Period, Value, New Issues | $ 5,576,083 | ||
Warrants Expiration Period | 66 months | ||
Shares Issued, Price Per Share | $ 1 | ||
Fair Value of Warrants | $ 2,067,000 | ||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 3,000,000 | ||
Common Stock [Member] | |||
Direct Offering [Line Items] | |||
Stock Issued During Period, Shares, New Issues | 5,000,000 | ||
Stock Issued During Period, Value, New Issues | $ 50 | ||
Common Stock [Member] | June Offering [Member] | |||
Direct Offering [Line Items] | |||
Stock Issued During Period, Shares, New Issues | 6,000,000 |
JOINT VENTURE, CONSULTING AGR34
JOINT VENTURE, CONSULTING AGREEMENT AND ASSOCIATED WARRANTS (Narrative) (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||
Issuance of Stock and Warrants for Services or Claims | $ 30,873 | $ 2,113,003 | ||
Warrant Exercisable Per Share | $ 3.36 | |||
Consulting Agreement [Member] | ||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||
Issuance of Stock and Warrants for Services or Claims | $ 4,070,000 | |||
Other Prepaid Expense, Current | $ 1,978,785 | |||
Consulting Agreement [Member] | Tranche 1A Warrants [Member] | ||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||
Issuance of Stock and Warrants for Services or Claims | $ 2,810,000 | |||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 1,250,000 | |||
Consulting Agreement [Member] | Tranche 1B Warrants [Member] | ||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 1,000,000 | |||
Consulting Agreement [Member] | Tranche 2 Warrants [Member] | ||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 1,000,000 | |||
Consulting Agreement [Member] | Tranche 3 Warrants [Member] | ||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 1,000,000 |
MANUFACTURING FACILITY (Narrati
MANUFACTURING FACILITY (Narrative) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Manufacturing Facility [Line Items] | ||||
General and Administrative Expense, Total | $ 1,721,775 | $ 1,297,064 | $ 3,568,382 | $ 4,948,785 |
North Carolina Manufacturing Facility [Member] | ||||
Manufacturing Facility [Line Items] | ||||
General and Administrative Expense, Total | $ 146,669 | $ 152,601 | $ 281,936 | $ 284,119 |
MACHINERY AND EQUIPMENT (Narrat
MACHINERY AND EQUIPMENT (Narrative) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Property, Plant and Equipment [Line Items] | ||||
Depreciation, Total | $ 81,067 | $ 78,630 | $ 161,664 | $ 157,440 |
MACHINERY AND EQUIPMENT (Detail
MACHINERY AND EQUIPMENT (Details) - USD ($) | Jun. 30, 2016 | Dec. 31, 2015 |
Property, Plant and Equipment [Line Items] | ||
Cigarette manufacturing equipment | $ 3,016,246 | $ 3,016,246 |
Office furniture, fixtures and equipment | 96,882 | 95,361 |
Laboratory equipment | 19,076 | 0 |
Property, Plant and Equipment, Gross, Total | 3,132,204 | 3,111,607 |
Less: accumulated depreciation | 717,478 | 555,814 |
Machinery and equipment, net | $ 2,414,726 | $ 2,555,793 |
EQUITY INVESTMENT (Narrative) (
EQUITY INVESTMENT (Narrative) (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||||||
Mar. 31, 2015 | Sep. 15, 2014 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Apr. 14, 2014 | Apr. 11, 2014 | |
Schedule of Equity Method Investments [Line Items] | ||||||||||
Equity Method Investments | $ 1,080,580 | $ 1,080,580 | $ 1,222,651 | $ 250,000 | ||||||
Equity Method Investment, Realized Gain (Loss) on Disposal | (54,839) | $ (40,834) | $ (142,071) | $ (91,815) | ||||||
Percentage of Net Loss | 25.00% | |||||||||
Amortization of Intangible Assets | $ 126,041 | 109,702 | $ 250,882 | 216,289 | ||||||
Anandia Laboratories, Inc [Member] | ||||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||||
Equity Method Investments | $ 450,000 | $ 1,199,000 | $ 250,000 | |||||||
Equity Method Investment, Ownership Percentage | 15.00% | 25.00% | 25.00% | 10.00% | ||||||
Sale of Stock, Number of Shares Issued in Transaction | 394,500 | |||||||||
Equity Method Investment, Realized Gain (Loss) on Disposal | $ (40,427) | (26,422) | $ (133,247) | (62,991) | ||||||
Amortization of Intangible Assets | $ 14,412 | $ 28,824 | $ 14,412 | $ 28,824 | ||||||
Common Stock [Member] | ||||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||||
Sale of Stock, Number of Shares Issued in Transaction | 150,000 | |||||||||
Common Stock [Member] | Anandia Laboratories, Inc [Member] | ||||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||||
Sale of Stock, Number of Shares Issued in Transaction | 377,906 | |||||||||
Equity Method Investment Summarized Financial Information, Equity | $ 325,000 |
NOTES PAYABLE AND PATENT ACQU39
NOTES PAYABLE AND PATENT ACQUISITION (Narrative) (Details) - USD ($) | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2016 | Dec. 31, 2014 | Dec. 31, 2015 | Dec. 22, 2015 | Dec. 23, 2014 | |
Notes Payable And Patent Acquisition [Line Items] | |||||
Other Commitment | $ 1,213,000 | ||||
Finite Lived Intangible Assets Acquired With Notes Payable | $ 925,730 | ||||
Notes Payable, Current | $ 320,878 | $ 308,582 | |||
Notes Payable, Noncurrent | 307,938 | 307,938 | |||
Notes and Loans, Noncurrent, Total | 628,816 | $ 616,520 | |||
Patents [Member] | |||||
Notes Payable And Patent Acquisition [Line Items] | |||||
Other Commitment | $ 333,333 | 1,000,000 | |||
Other Commitment, Due in Second Year | 213,000 | ||||
Other Commitment, Due in Third Year | 333,333 | ||||
Other Commitment, Due in Fourth Year | 333,333 | ||||
Other Commitment, Due in Fifth Year | $ 333,333 | ||||
Finite-lived Intangible Assets Acquired | $ 1,138,730 |
SEVERANCE LIABILITY (Narrative)
SEVERANCE LIABILITY (Narrative) (Details) - USD ($) | 3 Months Ended | ||
Dec. 31, 2014 | Jun. 30, 2016 | Dec. 31, 2015 | |
Severance Liability [Line Items] | |||
Severance Costs | $ 624,320 | ||
Severance Term | 36 months | ||
Accrued Severance Liabilities Current | $ 212,012 | $ 225,117 | $ 220,661 |
Accounts Payable and Accrued Liabilities, Noncurrent | 412,308 | $ 90,101 | $ 199,658 |
Employee Severance [Member] | |||
Severance Liability [Line Items] | |||
Monthly Severance Cost | $ 18,750 |
WARRANTS FOR COMMON STOCK (Narr
WARRANTS FOR COMMON STOCK (Narrative) (Details) - USD ($) | Feb. 05, 2016 | Jan. 25, 2016 | Jun. 02, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | ||
Class of Warrant or Right [Line Items] | ||||||||||||
Warrants outstanding | 10,236,621 | [1],[2],[3] | 10,236,621 | [1],[2],[3] | 16,634,778 | 13,674,409 | 10,653,469 | |||||
Derivative, Gain (Loss) on Derivative, Net, Total | $ (9,468) | $ 112,620 | $ 61,597 | $ 171,833 | ||||||||
Stock Issued During Period, Shares, New Issues | 2,618 | |||||||||||
Number Of Warrants Exercised | 67,042 | 67,042 | 40,000 | 1,247,443 | ||||||||
Warrants Expired And Unexercised | 6,831,115 | |||||||||||
Common Stock [Member] | ||||||||||||
Class of Warrant or Right [Line Items] | ||||||||||||
Warrants outstanding | 10,236,621 | 10,236,621 | ||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 10,236,621 | 10,236,621 | ||||||||||
Warrants Not Exercisable [Member] | ||||||||||||
Class of Warrant or Right [Line Items] | ||||||||||||
Warrants Expired And Unexercised | 2,000,000 | |||||||||||
February Offering [Member] | ||||||||||||
Class of Warrant or Right [Line Items] | ||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1.21 | |||||||||||
Warrants Expiration Period | 66 months | |||||||||||
Fair Value of Warrants | $ 1,940,000 | |||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 2,500,000 | |||||||||||
June Offering [Member] | ||||||||||||
Class of Warrant or Right [Line Items] | ||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1.25 | |||||||||||
Warrants Expiration Period | 66 months | |||||||||||
Fair Value of Warrants | $ 2,067,000 | |||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 3,000,000 | |||||||||||
Officers And Directors [Member] | ||||||||||||
Class of Warrant or Right [Line Items] | ||||||||||||
Percentage of Warrants Outstanding | 5.20% | |||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 533,000 | 533,000 | ||||||||||
Officers And Directors One [Member] | ||||||||||||
Class of Warrant or Right [Line Items] | ||||||||||||
Percentage of Warrants Outstanding | 3.10% | |||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 312,730 | 312,730 | ||||||||||
Warrants With Provision Of Anti Dilution [Member] | ||||||||||||
Class of Warrant or Right [Line Items] | ||||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 92,632 | 92,632 | ||||||||||
[1] | Excludes the Crede Tranche 2 and Tranche 3 warrants to purchase 2,000,000 shares of common stock because the warrants will never be exercisable (see Note 4 for additional discussion). | |||||||||||
[2] | Includes warrants to purchase 312,730 shares of common stock (3.1%) held by a former officer and director that have had the anti-dilution feature removed. | |||||||||||
[3] | Includes warrants to purchase 533,000 shares of common stock (5.2%) held by officers and directors that have had the anti-dilution feature removed. |
WARRANTS FOR COMMON STOCK (Outs
WARRANTS FOR COMMON STOCK (Outstanding Warrants) (Details) - $ / shares | 6 Months Ended | |||||
Jun. 30, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |||
Class of Warrant or Right [Line Items] | ||||||
Number of warrants | 10,236,621 | [1],[2],[3] | 16,634,778 | 13,674,409 | 10,653,469 | |
December 2011 Convertible Notes Payable Warrants One [Member] | ||||||
Class of Warrant or Right [Line Items] | ||||||
Number of warrants | 172,730 | |||||
Exercise Price | $ 1.1984 | |||||
Expiration | Feb. 8, 2017 | |||||
December 2011 Convertible Notes Payable Warrants Two [Member] | ||||||
Class of Warrant or Right [Line Items] | ||||||
Number of warrants | 802,215 | |||||
Exercise Price | $ 1.3816 | |||||
Expiration | Feb. 6, 2018 | |||||
May 2012 Private Placement Offering Warrants [Member] | ||||||
Class of Warrant or Right [Line Items] | ||||||
Number of warrants | 401,700 | |||||
Exercise Price | $ 0.6 | |||||
Expiration | May 15, 2017 | |||||
November 2012 Private Placement Offering Warrants [Member] | ||||||
Class of Warrant or Right [Line Items] | ||||||
Number of warrants | 925,100 | |||||
Exercise Price | $ 0.6 | |||||
Expiration | Nov. 9, 2017 | |||||
August 2012 Convertible Notes Payable Warrants One [Member] | ||||||
Class of Warrant or Right [Line Items] | ||||||
Number of warrants | [4] | 92,632 | ||||
Exercise Price | [4] | $ 0.952 | ||||
Expiration | [4] | Aug. 8, 2018 | ||||
August 2012 Convertible Notes Payable Warrants Two [Member] | ||||||
Class of Warrant or Right [Line Items] | ||||||
Number of warrants | 92,244 | |||||
Exercise Price | $ 0.906 | |||||
Expiration | Aug. 8, 2018 | |||||
Crede Tranche 1A warrants [Member] | ||||||
Class of Warrant or Right [Line Items] | ||||||
Number of warrants | 1,250,000 | |||||
Exercise Price | $ 3.36 | |||||
Expiration | Sep. 29, 2016 | |||||
Crede Tranche 1B warrants [Member] | ||||||
Class of Warrant or Right [Line Items] | ||||||
Number of warrants | 1,000,000 | |||||
Exercise Price | $ 2.5951 | |||||
Expiration | Sep. 29, 2016 | |||||
June 2015 registered direct offering warrants [Member] | ||||||
Class of Warrant or Right [Line Items] | ||||||
Number of warrants | 3,000,000 | |||||
Exercise Price | $ 1.25 | |||||
Expiration | [5] | Dec. 2, 2020 | ||||
February 2016 registered direct offering warrants [Member] | ||||||
Class of Warrant or Right [Line Items] | ||||||
Number of warrants | 2,500,000 | |||||
Exercise Price | $ 1.21 | |||||
Expiration | [5] | Aug. 5, 2021 | ||||
[1] | Excludes the Crede Tranche 2 and Tranche 3 warrants to purchase 2,000,000 shares of common stock because the warrants will never be exercisable (see Note 4 for additional discussion). | |||||
[2] | Includes warrants to purchase 312,730 shares of common stock (3.1%) held by a former officer and director that have had the anti-dilution feature removed. | |||||
[3] | Includes warrants to purchase 533,000 shares of common stock (5.2%) held by officers and directors that have had the anti-dilution feature removed. | |||||
[4] | Includes anti-dilution features. | |||||
[5] | The warrants were terminated on July 27, 2016 (see Note 14 - Subsequent Events for additional information). |
WARRANTS FOR COMMON STOCK (Roll
WARRANTS FOR COMMON STOCK (Roll-Forward of Warrant Liability from Initial Valuation) (Details) - USD ($) | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Class of Warrant or Right [Line Items] | ||||
Fair value of warrant liability upon Issuance / conversion | $ 26,699 | $ 2,898,296 | $ 3,042,846 | $ 3,779,522 |
Reclassification of warrant liability to equity resulting from Warrant Amendments - Q1 2014 | (7,367,915) | |||
Cost of inducement from Warrant Amendments - Q1 2014 | 144,548 | |||
Reclassification of warrant liability to capital in excess of par | (2,810,000) | |||
Gain as a result of change in fair value | $ (61,597) | $ (144,550) | ||
Loss as a result of change in fair value | 3,676,691 | |||
Crede Tranche 1A warrants [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Fair value of warrant liability upon Issuance / conversion | $ 2,810,000 |
WARRANTS FOR COMMON STOCK (Warr
WARRANTS FOR COMMON STOCK (Warrant Activity) (Details) - shares | 1 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jan. 25, 2016 | Jun. 30, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |||
Class of Warrant or Right [Line Items] | ||||||
Warrant outstanding beginning balance | 16,634,778 | 13,674,409 | 10,653,469 | |||
Warrants issued in conjunction with consulting agreement | 4,250,000 | |||||
Warrants issued in conjunction with registered direct offering | 2,500,000 | 3,000,000 | ||||
Unexercisable warrants | [1] | (2,000,000) | ||||
Warrants exercised | (67,042) | (67,042) | (40,000) | (1,247,443) | ||
Warrants expired | (6,831,115) | |||||
Additional warrants due to anti-dilution provisions | 369 | 18,383 | ||||
Warrant outstanding ending balance | 10,236,621 | [2],[3],[4] | 16,634,778 | 13,674,409 | ||
Composition of outstanding warrants: | ||||||
Warrants containing anti-dilution feature | 92,632 | |||||
Warrants without anti-dilution feature | 10,143,989 | |||||
Warrants Outstanding | 10,236,621 | |||||
[1] | Crede Tranche 2 Warrants and Tranche 3 Warrants are not exercisable (see Note 4 for additional discussion). | |||||
[2] | Excludes the Crede Tranche 2 and Tranche 3 warrants to purchase 2,000,000 shares of common stock because the warrants will never be exercisable (see Note 4 for additional discussion). | |||||
[3] | Includes warrants to purchase 312,730 shares of common stock (3.1%) held by a former officer and director that have had the anti-dilution feature removed. | |||||
[4] | Includes warrants to purchase 533,000 shares of common stock (5.2%) held by officers and directors that have had the anti-dilution feature removed. |
COMMITMENTS AND CONTINGENCIES45
COMMITMENTS AND CONTINGENCIES (Narrative) (Details) | Dec. 08, 2015USD ($) | Nov. 01, 2015USD ($)a | Feb. 10, 2014USD ($) | Sep. 30, 2016USD ($) | Jun. 30, 2016USD ($) | Sep. 15, 2014USD ($) | Aug. 27, 2014USD ($) | Aug. 22, 2014USD ($) | Jun. 30, 2016USD ($) | Jun. 30, 2015USD ($) | Jun. 30, 2016USD ($) | Jun. 30, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2016USD ($) | May 19, 2016shares | May 01, 2016USD ($) | Dec. 31, 2015USD ($) |
Other Commitments [Line Items] | |||||||||||||||||
Annual minimum royalty payments | $ 75,000 | ||||||||||||||||
Milestone payment upon approval of a product | $ 150,000 | ||||||||||||||||
Research and Development Expense, Total | $ 509,928 | $ 283,600 | 1,107,319 | $ 442,069 | |||||||||||||
License Costs | $ 150,000 | $ 85,681 | |||||||||||||||
Amortization of Other Deferred Charges | 126,041 | 109,702 | 250,882 | 216,289 | |||||||||||||
Lease Payments | 36,131 | 30,750 | 72,262 | 61,500 | |||||||||||||
Minimum Royalty Fee Payments Due In Year Four | $ 15,000 | 15,000 | 15,000 | ||||||||||||||
Operating Leases, Future Minimum Payments Due, Next Twelve Months | 74,000 | 74,000 | 74,000 | ||||||||||||||
Operating Leases, Future Minimum Payments, Due in Two Years | 156,000 | 156,000 | 156,000 | ||||||||||||||
Operating Leases, Future Minimum Payments, Due in Three Years | 169,000 | 169,000 | $ 169,000 | ||||||||||||||
Research and Development Arrangement, Contract to Perform for Others, Description and Terms | 12 months | ||||||||||||||||
Operating Leases, Future Minimum Payments, Due in Four Years | 169,000 | 169,000 | $ 169,000 | ||||||||||||||
Operating Leases, Rent Expense, Minimum Rentals | $ 3,750 | ||||||||||||||||
Land Subject to Ground Leases | a | 25,000 | ||||||||||||||||
Minimum Annual Royalties In Year Four | 15,000 | 15,000 | 15,000 | ||||||||||||||
Minimum Annual Royalties In Year Five | 25,000 | 25,000 | 25,000 | ||||||||||||||
Minimum Annual Royalties After Year Five | 50,000 | 50,000 | 50,000 | ||||||||||||||
Minimum Annual Royalties In Year Three | 10,000 | 10,000 | 10,000 | ||||||||||||||
Litigation Settlement Shares To Be Issued | shares | 2,077,555 | ||||||||||||||||
Payment One [Member] | |||||||||||||||||
Other Commitments [Line Items] | |||||||||||||||||
Research and Development Arrangement, Contract to Perform for Others, Costs Incurred, Gross | 295,600 | 379,800 | |||||||||||||||
Payment Two [Member] | |||||||||||||||||
Other Commitments [Line Items] | |||||||||||||||||
Research and Development Arrangement, Contract to Perform for Others, Costs Incurred, Gross | 84,200 | 0 | 179,200 | 0 | |||||||||||||
Office space in Clarence, New York [Member] | |||||||||||||||||
Other Commitments [Line Items] | |||||||||||||||||
Operating Leases, Future Minimum Payments, Due in Two Years | 23,000 | 23,000 | 23,000 | ||||||||||||||
Operating Leases, Future Minimum Payments, Due in Three Years | 31,000 | 31,000 | 31,000 | ||||||||||||||
Warehouse Space in North Carolina [Member] | |||||||||||||||||
Other Commitments [Line Items] | |||||||||||||||||
Operating Leases, Future Minimum Payments Due, Next Twelve Months | $ 22,500 | ||||||||||||||||
Operating Leases, Future Minimum Payments, Due in Two Years | 45,000 | ||||||||||||||||
Operating Leases, Future Minimum Payments, Due in Three Years | 45,000 | ||||||||||||||||
Operating Leases, Future Minimum Payments, Due in Four Years | $ 37,500 | ||||||||||||||||
Laboratory space in Buffalo [Member] | |||||||||||||||||
Other Commitments [Line Items] | |||||||||||||||||
Annual minimum royalty payments | $ 1,471 | ||||||||||||||||
Operating Leases, Future Minimum Payments Due, Next Twelve Months | 8,800 | ||||||||||||||||
Operating Leases, Future Minimum Payments, Due in Two Years | 18,000 | ||||||||||||||||
Operating Leases, Future Minimum Payments, Due in Three Years | $ 6,000 | ||||||||||||||||
Scenario, Forecast [Member] | |||||||||||||||||
Other Commitments [Line Items] | |||||||||||||||||
Annual minimum royalty payments | $ 225,000 | ||||||||||||||||
Scenario, Forecast [Member] | Payment One [Member] | |||||||||||||||||
Other Commitments [Line Items] | |||||||||||||||||
Research and Development Arrangement, Contract to Perform for Others, Costs Incurred, Gross | $ 84,200 | ||||||||||||||||
Licensing Agreements One [Member] | |||||||||||||||||
Other Commitments [Line Items] | |||||||||||||||||
Research and Development Expense, Total | $ 162,408 | 115,170 | 39,051 | 229,967 | 78,102 | ||||||||||||
License Costs | $ 125,000 | ||||||||||||||||
License Maintenance Fees Due Current | 15,000 | 15,000 | 15,000 | ||||||||||||||
License Maintenance Fees Due In Two Years | 15,000 | 15,000 | 15,000 | ||||||||||||||
License Maintenance Fees Due In Three Years | 15,000 | 15,000 | 15,000 | ||||||||||||||
Minimum Royalty Fee Payments Due In Year Five | 30,000 | 30,000 | 30,000 | ||||||||||||||
Minimum Royalty Fee Payments Due Thereafter | 50,000 | 50,000 | 50,000 | ||||||||||||||
Capitalized Patent Costs Gross | 5,983 | 522 | 33,939 | 4,204 | |||||||||||||
Minimum Royalty Fee Payments Due In Year Three | $ 20,000 | 20,000 | 20,000 | ||||||||||||||
Patents [Member] | |||||||||||||||||
Other Commitments [Line Items] | |||||||||||||||||
Capitalized Patent Costs Gross | 10,016 | 6,278 | 13,996 | 23,606 | |||||||||||||
Precision License [Member] | |||||||||||||||||
Other Commitments [Line Items] | |||||||||||||||||
License Costs | $ 1,250,000 | ||||||||||||||||
Finite-lived Intangible Assets Acquired | 725,000 | ||||||||||||||||
Obligation To Pay Remaining License Cost | 525,000 | $ 525,000 | |||||||||||||||
Amortization of Other Deferred Charges | 24,505 | 24,506 | 49,011 | 49,011 | |||||||||||||
Obligation To Pay Remaining License Cost In Increments | 25,000 | ||||||||||||||||
Anandia Sublicense [Member] | |||||||||||||||||
Other Commitments [Line Items] | |||||||||||||||||
License Costs | $ 10,000 | ||||||||||||||||
Upfront Fee | $ 75,000 | ||||||||||||||||
Licensing Agreements Two [Member] | |||||||||||||||||
Other Commitments [Line Items] | |||||||||||||||||
Capitalized Patent Costs Gross | $ 0 | $ 0 | $ 6,075 | $ 0 |
COMMITMENTS AND CONTINGENCIES46
COMMITMENTS AND CONTINGENCIES (Future Minimum Lease Payments) (Details) | Jun. 30, 2016USD ($) |
Other Commitments [Line Items] | |
Year ended December 31, 2016 - | $ 74,000 |
Year ended December 31, 2017 - | 156,000 |
Year ended December 31, 2018 - | 169,000 |
Year ended December 31, 2019 - | 169,000 |
Year ended December 31, 2020 - | 169,000 |
Year ended December 31, 2021 - | $ 141,000 |
EARNINGS PER COMMON SHARE (Comp
EARNINGS PER COMMON SHARE (Computation of Basic and Diluted Earnings Per Common Share) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Net loss attributed to common shareholders | $ (2,902,354) | $ (1,288,703) | $ (6,154,806) | $ (5,405,442) |
Denominator for basic earnings per share-weighted average shares outstanding | 76,024,064 | 66,616,739 | 75,027,606 | 65,408,908 |
Effect of dilutive securities: | ||||
Warrants, restricted stock and options outstanding | 0 | 0 | 0 | 0 |
Denominator for diluted earnings per common share-weighted average shares adjusted for dilutive securities | 76,024,064 | 66,616,739 | 75,027,606 | 65,408,908 |
Loss per common share - basic and diluted | $ (0.04) | $ (0.02) | $ (0.08) | $ (0.08) |
EARNINGS PER COMMON SHARE (Anti
EARNINGS PER COMMON SHARE (Anti-Dilutive Securities Outstanding Excluded from Computation) (Details) - shares | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Securities outstanding but excluded from computation of earnings per share | 15,222,300 | 19,436,420 |
Warrants [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Securities outstanding but excluded from computation of earnings per share | 10,236,621 | 16,674,778 |
Restricted Stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Securities outstanding but excluded from computation of earnings per share | 0 | 100,000 |
Options [ Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Securities outstanding but excluded from computation of earnings per share | 4,985,679 | 2,661,642 |
EQUITY BASED COMPENSATION (Narr
EQUITY BASED COMPENSATION (Narrative) (Details) - USD ($) | Apr. 12, 2014 | Jun. 30, 2016 | Jun. 30, 2015 | Mar. 31, 2015 | Mar. 31, 2014 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Oct. 21, 2010 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Equity based employee compensation expense | $ 212,222 | $ 331,773 | $ 472,216 | $ 685,860 | ||||||||
Unrecognized compensation expense related to non-vested restricted shares and stock option | $ 1,327,000 | $ 1,327,000 | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value | $ 0.64 | $ 0.59 | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 1,824,037 | 1,721,642 | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value | $ 1,138,910 | $ 206,500 | ||||||||||
Omnibus Incentive Plan [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 90,000 | 61,643 | 1,724,037 | |||||||||
Omnibus Incentive Plan [Member] | Common Stock [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 5,000,000 | |||||||||||
Scenario, Forecast [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Unrecognized compensation expense related to non-vested restricted shares and stock option | $ 48,000 | $ 272,000 | $ 362,000 | $ 371,000 | ||||||||
Third Party [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Equity based employee compensation expense | $ 8,000 | $ 25,885 | $ 30,873 | $ 134,218 | ||||||||
Restricted shares awarded vested immediately | 10,000 | 100,000 | 15,811 | |||||||||
Restricted Stock [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Restricted shares awarded vested immediately | 189,196 | |||||||||||
Restricted Stock [Member] | Omnibus Incentive Plan [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Stock Issued During Period, Shares, Restricted Stock Award, Gross | 20,000 | |||||||||||
Equity Incentive Plan 2010 [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Share-Based Compensation Arrangement By Share-Based Payment Award, Number Of Shares Authorized | 4,250,000 | |||||||||||
Stock Issued During Period, Shares, Restricted Stock Award, Gross | 850,000 | |||||||||||
Employee Stock Option [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Unrecognized compensation expense related to non-vested restricted shares and stock option | $ 274,000 | $ 274,000 | ||||||||||
Employee Stock Option [Member] | Omnibus Incentive Plan [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Stock Issued During Period, Shares, Restricted Stock Award, Gross | 1,559,999 | |||||||||||
Employee Stock Option [Member] | Third Party [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Restricted shares awarded vested immediately | 100,000 |
EQUITY BASED COMPENSATION (Sche
EQUITY BASED COMPENSATION (Schedule of Fair Value Assumptions) (Details) | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Risk-free interest rate | 1.38% | 1.50% |
Expected dividend yield | 0.00% | 0.00% |
Expected stock price volatility | 90.00% | 90.00% |
Expected life of options | 5 years 11 days | 8 years 7 months 28 days |
EQUITY BASED COMPENSATION (Summ
EQUITY BASED COMPENSATION (Summary of All Stock Option Activity) (Details) - USD ($) | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Number of Options | |||
Options Outstanding, Beginning of Period | 3,161,642 | 890,000 | 660,000 |
Reinstated | 50,000 | ||
Granted | 1,824,037 | 2,221,642 | 300,000 |
Exercised | (70,000) | ||
Options Outstanding, End of Period | 4,985,679 | 3,161,642 | 890,000 |
Exercisable, End of Period | 2,511,642 | ||
Weighted Average Exercise Price | |||
Options Outstanding, Beginning of Period | $ 1.1 | $ 1.38 | $ 0.74 |
Reinstated | 0.69 | ||
Granted | 0.94 | 1 | 2.61 |
Exercised | 0.69 | ||
Options Outstanding, End of Period | 1.04 | $ 1.1 | $ 1.38 |
Exercisable, End of Period | $ 1.15 | ||
Weighted Average Remaining Contractual Term | |||
Options Outstanding, End of Period | 7 years 8 months 12 days | ||
Exercisable, End of Period | 7 years 1 month 6 days | ||
Aggregate Intrinsic Value | |||
Options Outstanding, End of Period | $ 92,450 | ||
Exercisable, End of Period | $ 56,950 |
SUBSEQUENT EVENTS (Narrative) (
SUBSEQUENT EVENTS (Narrative) (Details) - USD ($) | 1 Months Ended | ||||||
Jul. 27, 2016 | Jan. 25, 2016 | Jun. 30, 2016 | [1],[2],[3] | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Subsequent Event [Line Items] | |||||||
Stock Issued During Period, Shares, New Issues | 2,618 | ||||||
Class of Warrant or Right, Outstanding | 10,236,621 | 16,634,778 | 13,674,409 | 10,653,469 | |||
Subsequent Event [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Fair Value of Warrants | $ 3,058,000 | ||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1 | ||||||
Warrants to Purchase of Common Stock | 1.141 | ||||||
Warrant Expiration Term | 5 years 6 months | ||||||
Warrant Exercise Rights, Maximum Beneficial Ownership Percentage On Common Stock | 4.99% | ||||||
Warrant Exercise Right, Maximum Limitation Percentage | 9.99% | ||||||
Class Of Warrants Or Right ,Terminated | 5,500,000 | ||||||
Share Price | $ 1.15 | ||||||
Subsequent Event [Member] | Minimum [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Class Of Warrant Or Right Terminated,Exercise Price | 1.21 | ||||||
Subsequent Event [Member] | Maximum [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Class Of Warrant Or Right Terminated,Exercise Price | 1.25 | ||||||
Subsequent Event [Member] | July Offering [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Shares Issued, Price Per Share | $ 0.81 | ||||||
Fair Value of Warrants | $ 858,000 | ||||||
Sale of Stock, Consideration Received on Transaction | $ 5,000,000 | ||||||
Subsequent Event [Member] | July Offering [Member] | Common Stock [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Stock Issued During Period, Shares, New Issues | 6,172,840 | ||||||
Subsequent Event [Member] | July Offering [Member] | Warrant [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Stock Issued During Period, Shares, New Issues | 7,043,211 | ||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 1,543,210 | ||||||
Class of Warrant or Right, Outstanding | 5,500,001 | ||||||
[1] | Excludes the Crede Tranche 2 and Tranche 3 warrants to purchase 2,000,000 shares of common stock because the warrants will never be exercisable (see Note 4 for additional discussion). | ||||||
[2] | Includes warrants to purchase 312,730 shares of common stock (3.1%) held by a former officer and director that have had the anti-dilution feature removed. | ||||||
[3] | Includes warrants to purchase 533,000 shares of common stock (5.2%) held by officers and directors that have had the anti-dilution feature removed. |