Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Mar. 26, 2018 | Jun. 30, 2017 | |
Document And Entity Information [Abstract] | |||
Entity Registrant Name | Ascent Solar Technologies, Inc. | ||
Entity Central Index Key | 1,350,102 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Smaller Reporting Company | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2017 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Common Stock, Shares Outstanding | 12,738,084,718 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 2.9 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Current Assets: | ||
Cash and cash equivalents | $ 89,618 | $ 130,946 |
Trade receivables, net of allowance of $48,201 and $106,205, respectively | 6,658 | 549,204 |
Inventories | 1,037,854 | 2,569,816 |
Prepaid expenses and other current assets | 494,425 | 983,796 |
Total current assets | 1,628,555 | 4,233,762 |
Property, Plant and Equipment: | 36,645,862 | 36,639,460 |
Less accumulated depreciation and amortization | (32,013,686) | (30,983,448) |
Net property, plant and equipment | 4,632,176 | 5,656,012 |
Other Assets: | ||
Patents, net of accumulated amortization of $430,071 and $279,143, respectively | 1,470,796 | 1,647,505 |
Other non-current assets | 49,813 | 77,562 |
Total other assets | 1,520,609 | 1,725,067 |
Total Assets | 7,781,340 | 11,614,841 |
Current Liabilities: | ||
Accounts payable | 1,600,455 | 4,902,471 |
Related party payables | 202,827 | 214,903 |
Accrued expenses | 1,623,748 | 1,469,684 |
Notes payable | 1,570,231 | 0 |
Current portion of long-term debt | 343,395 | 243,113 |
Current portion of secured promissory notes, net of discount of $1,934,304 and zero, respectively | 253,590 | 1,010,000 |
Litigation settlement | 0 | 339,481 |
Promissory notes, net of discount of $20,626 and zero, respectively | 948,811 | 420,000 |
Embedded derivative liabilities | 6,406,833 | 6,578,154 |
Make-whole dividend liability | 0 | 500,176 |
Total current liabilities | 14,312,482 | 18,097,684 |
Long-term debt, net of current portion | 5,118,424 | 5,281,776 |
Secured promissory notes, net of current portion and discount of $1,684,267 and zero, respectively | 685,066 | 0 |
Accrued Warranty Liability | 57,703 | 176,457 |
Commitments and Contingencies | 0 | 0 |
Stockholders’ Deficit: | ||
Common stock, $0.0001 par value, 20,000,000,000 and 2,000,000,000 shares authorized as of December 31, 2017 and December 31, 2016, respectively; 9,606,597,777 and 554,223,320 shares issued and outstanding as of December 31, 2017 and December 31, 2016, respectively | 960,660 | 55,422 |
Additional paid in capital | 386,332,475 | 369,886,065 |
Accumulated deficit | (402,495,476) | (383,932,576) |
Total stockholders’ equity (deficit) | (15,202,335) | (13,991,076) |
Total Liabilities and Stockholders’ Equity | 7,781,340 | 11,614,841 |
July 2016 Convertible Notes [Member] | ||
Current Liabilities: | ||
Convertible notes | 0 | 1,159,610 |
October 2016 Convertible Notes [Member] | ||
Current Liabilities: | ||
Convertible notes | 330,000 | 66,000 |
Series E Preferred Stock [Member] | ||
Current Liabilities: | ||
Series preferred stock, net of discount | 0 | 56,360 |
Series F Preferred Stock [Member] | ||
Current Liabilities: | ||
Series preferred stock, net of discount | 0 | 160,001 |
Series G Preferred Stock [Member] | ||
Current Liabilities: | ||
Series preferred stock, net of discount | 0 | 408,326 |
Series I Exchange Notes [Member] | ||
Current Liabilities: | ||
Convertible notes | 0 | 26,597 |
Series J Preferred Stock [Member] | ||
Current Liabilities: | ||
Redeemable preferred stock | 0 | 1,350,000 |
Series J-1 Preferred Stock [Member] | ||
Current Liabilities: | ||
Redeemable preferred stock | 0 | 700,000 |
Series K Preferred Stock [Member] | ||
Current Liabilities: | ||
Redeemable preferred stock | 2,810,000 | 0 |
Stockholders’ Deficit: | ||
Series A preferred stock, $.0001 par value; 750,000 shares authorized and issued; 60,756 and 125,044 shares outstanding as of December 31, 2017 and December 31, 2016, respectively ($761,864 and $1,500,528 Liquidation Preference) | 2,810,000 | |
Series A Preferred Stock [Member] | ||
Stockholders’ Deficit: | ||
Series A preferred stock, $.0001 par value; 750,000 shares authorized and issued; 60,756 and 125,044 shares outstanding as of December 31, 2017 and December 31, 2016, respectively ($761,864 and $1,500,528 Liquidation Preference) | 6 | 13 |
TFG Promissory Notes [Member] | ||
Current Liabilities: | ||
Notes payable | 0 | 542,808 |
St. George Convertible Note [Member] | ||
Current Liabilities: | ||
Convertible notes | 1,032,592 | 0 |
Baybridge Convertible Note [Member] | ||
Current Liabilities: | ||
Convertible notes | $ 0 | $ 0 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Allowance for doubtful accounts | $ 48,201 | $ 106,205 |
Patents, amortization | $ 430,071 | $ 279,143 |
Preferred stock, par value (in dollars per share) | $ 0.0001 | |
Preferred stock, shares authorized (in shares) | 25,000,000 | |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 20,000,000,000 | 2,000,000,000 |
Common stock, shares issued (in shares) | 9,606,597,777 | 554,223,320 |
Common stock, shares outstanding (in shares) | 9,606,597,777 | 554,223,320 |
Series E Preferred Stock [Member] | ||
Debt instrument, unamortized discount | $ 0 | $ 63,640 |
Preferred stock, shares authorized (in shares) | 2,800 | |
Preferred stock, shares outstanding (in shares) | 0 | |
Series G Preferred Stock [Member] | ||
Debt instrument, unamortized discount | $ 0 | 699,674 |
Preferred stock, shares authorized (in shares) | 2,000 | |
Preferred stock, shares outstanding (in shares) | 0 | |
July 2016 Convertible Notes [Member] | ||
Debt instrument, unamortized discount | $ 0 | 1,634,357 |
Series I Exchange Notes [Member] | ||
Debt instrument, unamortized discount | 0 | 199,474 |
October 2016 Convertible Notes [Member] | ||
Debt instrument, unamortized discount | $ 0 | $ 264,000 |
Series J Preferred Stock [Member] | ||
Preferred stock, shares authorized (in shares) | 1,350 | 1,350 |
Preferred stock, shares issued (in shares) | 0 | 1,350 |
Preferred stock, shares outstanding (in shares) | 0 | 1,350 |
Series J-1 Preferred Stock [Member] | ||
Preferred stock, shares authorized (in shares) | 1,000 | 1,000 |
Preferred stock, shares issued (in shares) | 0 | 700 |
Preferred stock, shares outstanding (in shares) | 0 | 700 |
Series A Preferred Stock [Member] | ||
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 750,000 | 750,000 |
Preferred stock, shares issued (in shares) | 750,000 | 750,000 |
Preferred stock, shares outstanding (in shares) | 60,756 | 125,044 |
Preferred stock, liquidation preference | $ 761,864 | $ 1,500,528 |
Series K Preferred Stock [Member] | ||
Preferred stock, shares authorized (in shares) | 20,000 | 0 |
Preferred stock, shares issued (in shares) | 2,810 | 0 |
Preferred stock, shares outstanding (in shares) | 2,810 | 0 |
TFG Promissory Notes [Member] | ||
Debt instrument, unamortized discount | $ 0 | $ 59,658 |
St. George Convertible Note [Member] | ||
Debt instrument, unamortized discount | 673,241 | 0 |
Promissory Notes [Member] | ||
Debt instrument, unamortized discount | 20,626 | 0 |
Baybridge Convertible Note [Member] | ||
Debt instrument, unamortized discount | 565,000 | 0 |
Secured Promissory Note, Current [Member] | ||
Debt instrument, unamortized discount | 1,934,304 | 0 |
Secured Promissory Note, Noncurrent [Member] | ||
Debt instrument, unamortized discount | $ 1,684,267 | $ 0 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Income Statement [Abstract] | ||
Revenues | $ 642,179 | $ 1,747,356 |
Costs and Expenses | ||
Cost of revenues (exclusive of depreciation shown below) | 2,814,782 | 5,843,872 |
Research, development and manufacturing operations (exclusive of depreciation shown below) | 4,820,536 | 6,627,249 |
Selling, general and administrative (exclusive of depreciation shown below) | 5,598,004 | 10,304,779 |
Depreciation and amortization | 1,193,535 | 3,600,007 |
Inventory impairment loss | 363,377 | 0 |
Total Costs and Expenses | 14,790,234 | 26,375,907 |
Loss from Operations | (14,148,055) | (24,628,551) |
Other Income/(Expense) | ||
Other Income/(Expense), net | 574,817 | 82,772 |
Interest Expense | (6,518,747) | (7,902,926) |
Deemed interest expense on warrant liability | (345,774) | 0 |
Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net | 1,877,629 | (6,402,077) |
Total Other Income/(Expense) | (4,412,075) | (14,222,231) |
Net Loss | $ (18,560,130) | $ (38,850,782) |
Net Loss Per Share (Basic and diluted) (in dollars per share) | $ 0.003 | $ (0.418) |
Weighted Average Common Shares Outstanding (Basic and diluted) (in shares) | 5,883,374,222 | 93,005,062 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Deficit) - USD ($) | Total | Rights [Member] | Committed Equity Line [Member] | Common stock [Member] | Common stock [Member]Rights [Member] | Common stock [Member]Committed Equity Line [Member] | Additional Paid-in Capital [Member] | Additional Paid-in Capital [Member]Rights [Member] | Additional Paid-in Capital [Member]Committed Equity Line [Member] | Accumulated Deficit [Member] | Series A Preferred Stock [Member] | Series A Preferred Stock [Member]Common stock [Member] | Series A Preferred Stock [Member]Preferred Stock [Member] | Series A Preferred Stock [Member]Additional Paid-in Capital [Member] | Series E Preferred Stock [Member] | Series E Preferred Stock [Member]Common stock [Member] | Series E Preferred Stock [Member]Additional Paid-in Capital [Member] | Series F Preferred Stock [Member] | Series F Preferred Stock [Member]Common stock [Member] | Series F Preferred Stock [Member]Additional Paid-in Capital [Member] | Series G Preferred Stock [Member] | Series G Preferred Stock [Member]Common stock [Member] | Series G Preferred Stock [Member]Additional Paid-in Capital [Member] | Series I Preferred Stock [Member] | Series I Preferred Stock [Member]Common stock [Member] | Series I Preferred Stock [Member]Additional Paid-in Capital [Member] | Series J Preferred Stock [Member] | Series J Preferred Stock [Member]Common stock [Member] | Series J Preferred Stock [Member]Additional Paid-in Capital [Member] | Series J-1 Preferred Stock [Member] | Series J-1 Preferred Stock [Member]Common stock [Member] | Series J-1 Preferred Stock [Member]Additional Paid-in Capital [Member] | Series K Preferred Stock [Member] | Series K Preferred Stock [Member]Common stock [Member] | Series K Preferred Stock [Member]Additional Paid-in Capital [Member] | Series I Exchange Notes [Member] | Series I Exchange Notes [Member]Common stock [Member] | Series I Exchange Notes [Member]Additional Paid-in Capital [Member] | Four Percent Original Issue Discount Senior Secured Convertible Promissory Notes [Member] | Four Percent Original Issue Discount Senior Secured Convertible Promissory Notes [Member]Common stock [Member] | Four Percent Original Issue Discount Senior Secured Convertible Promissory Notes [Member]Additional Paid-in Capital [Member] | October 2016 Convertible Notes [Member] | October 2016 Convertible Notes [Member]Common stock [Member] | October 2016 Convertible Notes [Member]Preferred Stock [Member] | October 2016 Convertible Notes [Member]Additional Paid-in Capital [Member] | TFG Promissory Notes [Member] | TFG Promissory Notes [Member]Common stock [Member] | TFG Promissory Notes [Member]Additional Paid-in Capital [Member] | BayBridge Promissory Notes [Member] | BayBridge Promissory Notes [Member]Common stock [Member] | BayBridge Promissory Notes [Member]Additional Paid-in Capital [Member] | Global Ichiban Convertible Notes [Member] | Global Ichiban Convertible Notes [Member]Common stock [Member] | Global Ichiban Convertible Notes [Member]Additional Paid-in Capital [Member] |
Beginning balance (in shares) at Dec. 31, 2015 | 7,759,844 | 212,390 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Beginning balance at Dec. 31, 2015 | $ 2,578,694 | $ 777 | $ 347,659,690 | $ (345,081,794) | $ 21 | |||||||||||||||||||||||||||||||||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Conversion of shares (in shares) | 48,993 | 6,942,936 | (46,849) | 41,895,161 | 113,059,991 | 234,409,413 | 6,988,353 | 14,816,862 | 64,000,000 | 42,857,508 | (40,497) | |||||||||||||||||||||||||||||||||||||||||||
Conversion of shares | 58,823 | $ 5 | 58,818 | $ 222,789 | $ 694 | $ (4) | $ 222,099 | $ 3,418,221 | $ 4,189 | $ 3,414,032 | $ 9,931,454 | $ 11,306 | $ 9,920,148 | $ 1,496,396 | $ 23,441 | $ 1,472,955 | $ 2,533,417 | $ 699 | $ 2,532,718 | $ 160,826 | $ 1,481 | $ 159,345 | $ 251,680 | $ 6,400 | $ 245,280 | $ 177,570 | $ 4,286 | $ (4) | $ 173,288 | |||||||||||||||||||||||||
Issuance of stock (in shares) | 2,052,865 | 525,454 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of common stock | $ 1,347,000 | $ 1,056,147 | $ 205 | $ 52 | $ 1,346,795 | $ 1,056,095 | ||||||||||||||||||||||||||||||||||||||||||||||||
Interest and Dividend Expense paid with Common Stock (in shares) | 18,575,710 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest and Dividend Expense paid with Common Stock | 256,780 | $ 1,858 | 254,922 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of Restricted Stock (in shares) | 183,230 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of Restricted Stock | 0 | $ 18 | (18) | |||||||||||||||||||||||||||||||||||||||||||||||||||
Commitment Shares (in shares) | 107,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitment Shares | 0 | $ 11 | (11) | |||||||||||||||||||||||||||||||||||||||||||||||||||
Stock based compensation | 888,348 | 888,348 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Beneficial Conversion Feature related to Series G and Series I Preferred Stock | 481,561 | 481,561 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | (38,850,782) | (38,850,782) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Ending balance (in shares) at Dec. 31, 2016 | 554,223,320 | 125,044 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Ending balance at Dec. 31, 2016 | (13,991,076) | $ 55,422 | 369,886,065 | (383,932,576) | $ 13 | |||||||||||||||||||||||||||||||||||||||||||||||||
Beginning balance (in shares) at Dec. 31, 2015 | 7,759,844 | 212,390 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Beginning balance at Dec. 31, 2015 | 2,578,694 | $ 777 | 347,659,690 | (345,081,794) | $ 21 | |||||||||||||||||||||||||||||||||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Conversion of shares (in shares) | 308,761,277 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Ending balance (in shares) at Dec. 31, 2017 | 9,606,597,777 | 60,756 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Ending balance at Dec. 31, 2017 | (15,202,335) | $ 960,660 | 386,332,475 | (402,495,476) | $ 6 | |||||||||||||||||||||||||||||||||||||||||||||||||
Beginning balance (in shares) at Dec. 31, 2016 | 554,223,320 | 125,044 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Beginning balance at Dec. 31, 2016 | (13,991,076) | $ 55,422 | 369,886,065 | (383,932,576) | $ 13 | |||||||||||||||||||||||||||||||||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Conversion of shares (in shares) | 131,088,740 | (64,288) | 247,371,677 | 189,780,458 | 1,529,316,391 | 419,719,614 | 365,646,259 | 466,666,667 | 1,550,000,000 | 2,808,248,547 | 333,333,333 | 473,404,630 | 168,251,234 | |||||||||||||||||||||||||||||||||||||||||
Conversion of shares | $ 257,152 | $ 13,109 | $ (7) | $ 244,050 | $ 120,000 | $ 24,737 | $ 95,263 | $ 127,000 | $ 18,978 | $ 108,022 | $ 898,000 | $ 152,932 | $ 745,068 | $ 226,071 | $ 41,972 | $ 184,099 | $ 275,000 | $ 36,565 | $ 238,435 | $ 700,000 | $ 46,667 | $ 653,333 | $ 6,200,000 | $ 155,000 | $ 6,045,000 | $ 1,699,967 | $ 280,825 | $ 1,419,142 | $ 544,681 | $ 33,333 | $ 511,348 | $ 377,999 | $ 47,340 | $ 330,659 | $ 163,508 | $ 16,825 | $ 146,683 | |||||||||||||||||
Interest and Dividend Expense paid with Common Stock (in shares) | 332,006,907 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest and Dividend Expense paid with Common Stock | 246,584 | $ 33,201 | 213,383 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of Restricted Stock (in shares) | 40,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of Restricted Stock | 0 | $ 4 | (4) | |||||||||||||||||||||||||||||||||||||||||||||||||||
Commitment Shares (in shares) | 37,500,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitment Shares | 63,750 | $ 3,750 | 60,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Loss on Extinguishment of Liabilities | 4,481,939 | 4,481,939 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Induced Conversion Costs | 500,948 | 500,948 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Warrant Expense | 345,774 | 345,774 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock based compensation | 123,268 | 123,268 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Prior period adjustment - subsidiary | (2,770) | (2,770) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | (18,560,130) | (18,560,130) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Ending balance (in shares) at Dec. 31, 2017 | 9,606,597,777 | 60,756 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Ending balance at Dec. 31, 2017 | $ (15,202,335) | $ 960,660 | $ 386,332,475 | $ (402,495,476) | $ 6 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Operating Activities: | ||
Net loss | $ (18,560,130) | $ (38,850,782) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 1,197,285 | 3,600,007 |
Stock based compensation | 123,268 | 888,348 |
Realized loss (gain) on sale of assets | (1,210,331) | (82,772) |
Amortization of financing costs | 76,351 | 137,111 |
Non-cash interest expense | 643,263 | 948,901 |
Amortization of debt discount | 4,427,086 | 6,214,060 |
Bad debt expense | 514 | 122,416 |
Accrued litigation settlement | (339,481) | (541,279) |
Warrant expense | 345,774 | 0 |
Impairment of inventory | 363,377 | 0 |
Warranty reserve | (118,754) | (87,543) |
Change in fair value of derivatives and loss on extinguishment of liabilities, net | (1,877,629) | 6,402,077 |
Induced conversion expense | 635,514 | 0 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 569,632 | 1,321,265 |
Inventories | 1,168,585 | 1,702,564 |
Prepaid expenses and other current assets | 389,910 | 379,374 |
Accounts payable | (592,403) | 1,492,053 |
Related party payable | (12,076) | |
Accrued expenses | 172,316 | (501,284) |
Net cash used in operating activities | (12,597,929) | (16,855,484) |
Investing Activities: | ||
Purchase of property, plant and equipment | (6,402) | (51,724) |
Proceeds from sale of assets | 150,000 | 82,772 |
Patent activity costs | (62,652) | (189,455) |
Net cash used in investing activities | 80,946 | (158,407) |
Financing Activities: | ||
Proceeds from debt | 5,542,500 | 1,930,000 |
Repayment of debt | (2,056,845) | (266,027) |
Payment of debt financing costs | (20,000) | (81,500) |
Proceeds from Committed Equity Line | 0 | 1,056,147 |
Proceeds from issuance of stock and warrants | 9,010,000 | 14,180,000 |
Net cash provided by financing activities | 12,475,655 | 16,818,620 |
Net change in cash and cash equivalents | (41,328) | (195,271) |
Cash and cash equivalents at beginning of period | 130,946 | 326,217 |
Cash and cash equivalents at end of period | 89,618 | 130,946 |
Supplemental Cash Flow Information: | ||
Cash paid for interest | 1,221,843 | 417,876 |
Cash paid for income taxes | 0 | 0 |
Non-Cash Transactions: | ||
Non-cash conversions of preferred stock and convertible notes to equity | 11,835,962 | 10,617,764 |
Non-cash conversions of preferred stock to notes payable | 1,075,000 | 0 |
Make-whole provision on convertible preferred stock | 257,152 | 161,988 |
Non-cash financing costs | 2,500 | 0 |
Debt converted to accounts payable | 55,067 | 0 |
Accounts payable converted to notes payable | 1,587,760 | 0 |
Accounts payable forgiven related to sale of EnerPlex | 1,031,726 | 0 |
Interest converted to principal | 431,195 | 0 |
Common shares issued for commitment fee | 63,750 | 0 |
Initial embedded derivative liabilities | $ 5,878,345 | $ 5,444,362 |
Organization
Organization | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | ORGANIZATION Ascent Solar Technologies, Inc. (“Ascent”) was incorporated on October 18, 2005 from the separation by ITN Energy Systems, Inc. (“ITN”) of its Advanced Photovoltaic Division and all of that division’s key personnel and core technologies. ITN, a private company incorporated in 1994, is an incubator dedicated to the development of thin film, photovoltaic (“PV”), battery, fuel cell and nano technologies. Through its work on research and development contracts for private and governmental entities, ITN developed proprietary processing and manufacturing know how applicable to PV products generally, and to Copper-Indium-Gallium-diSelenide (“CIGS”) PV products in particular. ITN formed Ascent to commercialize its investment in CIGS PV technologies. In January 2006, in exchange for 102,800 shares of common stock of Ascent, ITN assigned to Ascent certain CIGS PV technologies and trade secrets and granted to Ascent a perpetual, exclusive, royalty free worldwide license to use, in connection with the manufacture, development, marketing and commercialization of CIGS PV to produce solar power, certain of ITN’s existing and future proprietary and control technologies that, although non-specific to CIGS PV, Ascent believes will be useful in its production of PV modules for its target markets. Upon receipt of the necessary government approvals and pursuant to novation in early 2007, ITN assigned government funded research and development contracts to Ascent and also transferred the key personnel working on the contracts to Ascent. Currently, the Company is focusing on integrating its PV products into high value markets such as aerospace, satellites, near earth orbiting vehicles, and fixed-wing unmanned aerial vehicles (UAV). The value proposition of Ascent’s proprietary solar technology not only aligns with the needs of customers in these industries, but also overcomes many of the obstacles other solar technologies face in these unique markets. Ascent has the capability to design and develop finished products for end users in these areas as well as collaborate with strategic partners to design and develop custom integrated solutions for products like fixed-wing UAVs. Ascent sees significant overlap of the needs of end users across some of these industries and can achieve economies of scale in sourcing, development, and production in commercializing products for these customers. Reverse Stock Split On May 26, 2016, the Company, a Delaware corporation, filed a Certificate of Amendment to the Amended and Restated Certificate of Incorporation of the Company (the “Certificate of Amendment”) with the Secretary of State of the State of Delaware to effect a reverse stock split of the Company’s common stock, par value $0.0001 per share, at a ratio of one-for- twenty (the “Reverse Stock Split”). The Certificate of Amendment did not change the number of authorized shares, or the par value, of the Company’s common stock. The Certificate of Amendment provides that every twenty shares of the Company’s issued and outstanding common stock were automatically combined into one issued and outstanding share of the Company’s common stock. All shares and per share amounts in the consolidated financial statements and accompanying notes have been retroactively adjusted to give effect to the Reverse Stock Split. |
Basis of Presentation
Basis of Presentation | 12 Months Ended |
Dec. 31, 2017 | |
Basis Of Presentation [Abstract] | |
Basis of Presentation | BASIS OF PRESENTATION The accompanying consolidated financial statements have been derived from the accounting records of Ascent Solar Technologies, Inc., Ascent Solar (Asia) Pte. Ltd., and Ascent Solar (Shenzhen) Co., Ltd. (collectively, "the Company") as of December 31, 2017 and December 31, 2016 , and the results of operations for the years ended December 31, 2017 and 2016 . Ascent Solar (Shenzhen) Co., Ltd. is wholly owned by Ascent Solar (Asia) Pte. Ltd., which is wholly owned by Ascent Solar Technologies, Inc. All significant inter-company balances and transactions have been eliminated in the accompanying consolidated financial statements. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Cash Equivalents: The Company classifies all short-term investments in interest bearing bank accounts and highly liquid debt securities purchased with an original maturity of three months or less to be cash equivalents. The Company maintains cash balances which may exceed federally insured limits. The Company does not believe this results in significant credit risk. Foreign Currencies: Bank account balances held in foreign currencies are translated to U.S. dollars utilizing the period end exchange rate. Gains or losses incurred in connection with the Company’s accounts held in foreign currency were not material for the years ended December 31, 2017 and 2016 and were recorded in “Other Income/(Expense)” in the Consolidated Statements of Operations. Receivables and Allowance for Doubtful Accounts: Trade accounts receivable are recorded at the invoiced amount as the result of transactions with customers. The Company maintains allowances for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments. The Company estimates the collectability of accounts receivable using analysis of historical bad debts, customer credit-worthiness and current economic trends. Reserves are established on an account-by-account basis. Account balances are written off against the allowance in the period in which the Company determines that is it probable that the receivable will not be recovered. As of December 31, 2017 and 2016 , the Company had an allowance for doubtful accounts of $48,201 and $106,205 , respectively. Inventories: All inventories are stated at the lower of cost or net realizable value, with cost determined using the weighted average method. Inventory balances are frequently evaluated to ensure they do not exceed net realizable value. The computation for net realizable value takes into account many factors, including expected demand, product life cycle and development plans, module efficiency, quality issues, obsolescence and others. Management's judgment is required to determine reserves for obsolete or excess inventory. As of December 31, 2017 and 2016 , the Company had inventory reserve balances of $562,140 and $736,663 , respectively. If actual demand and market conditions are less favorable than those estimated by management, additional inventory write downs may be required. Due to the sale of the EnerPlex brand and the re-purposing of our work-in-process inventory, we are unable to estimate the recoverability of all of our work-in process inventory values, resulting in a lower-cost-to-market analysis and reserve for impairment. An expense of $363,377 was recorded to inventory impairment costs for the year ended December 31, 2017 . There were no lower of cost or market adjustments during the year ended December 31, 2016 . Property, Plant and Equipment: Property, plant and equipment are recorded at the original cost to the Company. Assets are being depreciated over estimated useful lives of three to forty years using the straight-line method, as presented in the table below, commencing when the asset is placed in service. Leasehold improvements are depreciated over the shorter of the remainder of the lease term or the life of the improvements. Upon retirement or disposal, the cost of the asset disposed of and the related accumulated depreciation are removed from the accounts and any gain or loss is reflected in income. Expenditures for repairs and maintenance are expensed as incurred. Useful Lives in Years Buildings 40 Manufacturing machinery and equipment 5 - 10 Furniture, fixtures, computer hardware/software 3 - 7 Leasehold improvements life of lease Patents: At such time as the Company is awarded patents, patent costs are amortized on a straight-line basis over the legal life on the patents, or over their estimated useful lives, whichever is shorter. As of December 31, 2017 and 2016 , the Company had $1,470,796 and $1,647,505 of net patent costs, respectively. Of these amounts $640,167 and $619,241 represents costs net of amortization incurred for awarded patents, and the remaining $830,629 and $1,028,264 represents costs incurred for patent applications to be filed as of December 31, 2017 and 2016 , respectively. During the years ended December 31, 2017 and 2016 , the Company capitalized $62,652 and $189,455 in patent costs, respectively, as it worked to secure design rights and trademarks for newly developed products. Amortization expense was $150,928 and $109,517 for the years ended December 31, 2017 and 2016 , respectively. As of December 31, 2017 , future amortization of patents is expected as follows: 2018 $ 173,439 2019 $ 153,717 2020 $ 130,885 2021 $ 85,760 2022 $ 56,099 Thereafter $ 40,267 $ 640,167 Impairment of Long-lived Assets: The Company analyzes its long-lived assets (property, plant and equipment) and definitive-lived intangible assets (patents) for impairment, both individually and as a group, whenever events or changes in circumstances indicate the carrying amount of the assets may not be recoverable. Events that might cause impairment would include significant current period operating or cash flow losses associated with the use of a long-lived asset or group of assets combined with a history of such losses, significant changes in the manner of use of assets and significant negative industry or economic trends. An undiscounted cash flow analysis is calculated to determine if impairment exists. If impairment is determined to exist, any related loss is calculated using the difference between the fair value and the carrying value of the assets. During the years ended December 31, 2017 and 2016 , the Company did not incur impairments of its manufacturing facilities and equipment. Interest Capitalization : Historically the Company has capitalized interest cost as part of the cost of acquiring or constructing certain assets during the period of time required to get the asset ready for its intended use. The Company capitalized interest to the extent that expenditures to acquire or construct an asset have occurred and interest cost has been incurred. Convertible Notes : The Company issues, from time to time, convertible notes. Refer to Notes 12, 13, 14, and 15 for further information. Convertible Preferred Stock: The Company evaluates its preferred stock instruments under FASB ASC 480, "Distinguishing Liabilities from Equity" to determine the classification, and thereby the accounting treatment, of the instruments. Refer to Notes 12, 16, 17, 18, 19, 20, 21, and 22 for further discussion on the classification of each instrument. Derivatives: The Company evaluates its financial instruments under FASB ASC 815, "Derivatives and Hedging" to determine whether the instruments contain an embedded derivative. When an embedded derivative is present, the instrument is evaluated for a fair value adjustment upon issuance and at the end of every reporting period. Any adjustments to fair value are treated as gains and losses in fair values of derivatives and are recorded in the Consolidated Statements of Operations. Refer to Notes 12, 13, 14, 15, 17, 18, 19, and 20 for further discussion on the embedded derivatives of each instrument. Product Warranties: The Company provides a limited warranty to the original purchaser of products against defective materials and workmanship. The Company also guarantees that standalone modules and PV integrated consumer electronics will achieve and maintain the stated conversion efficiency rating for certain products. Warranty accruals are recorded at the time of sale and are estimated based upon product warranty terms, historical experience and analysis of peer company product returns. The Company assesses the adequacy of its liabilities and makes adjustments as necessary based on known or anticipated warranty claims, or as new information becomes available. Warrant Liability: Warrants to purchase the Company's common stock with nonstandard anti-dilution provisions, regardless of the probability or likelihood that may conditionally obligate the issuer to ultimately transfer assets, are classified as liabilities and are recorded at their estimated fair value at each reporting period. Any change in fair value of these warrants is recorded at each reporting period in Other income/(expense) on the Company's statement of operations. Revenue Recognition: Product revenue - The Company generated product revenues of $642,179 and $1,699,802 for the years ended December 31, 2017 and 2016 , respectively. Product revenue is generated from commercial sales of flexible PV modules and PV integrated consumer electronics, non-PV integrated power banks and associated accessories. Products are sold through the Company's own e-commerce website, online retailers, direct to retailers and indirectly to retailers through distributors. Revenue is recognized as products are shipped or delivered and title has transferred to the customer. In certain instances, the Company has agreed to refund a portion of the purchase price to customers if the Company decreases its standard retail price. The Company estimates the effect of this price protection and records the difference as a reduction of revenue at the time of sale. We also, in certain instances have provided customers with a right of return provision. In these instances, we defer the recognition of revenues until the provision period has expired. Estimated costs of returns and allowances, other than those specifically pertaining to a right of return provision, and discounts are accrued as a reduction to sales when revenue is recognized. See Marketing and Advertising Costs below for accounting treatment related to cooperative advertising programs. Government contracts revenue - Revenue from governmental research and development contracts is generated under terms that are cost plus fee or firm fixed price. Revenue from cost plus fee contracts is recognized as costs are incurred on the basis of direct costs plus allowable indirect costs and an allocable portion of the fixed fee. Revenue from firm fixed price contracts is recognized under the percentage-of-completion method of accounting, with costs and estimated profits included in contract revenue as work is performed. If actual and estimated costs to complete a contract indicate a loss, provision is made currently for the loss anticipated on the contract. Shipping and Handling Costs: The Company classifies shipping and handling costs for products shipped to customers as a component of “Cost of revenues” on the Company’s Consolidated Statements of Operations. Customer payments of shipping and handling costs are recorded as a component of Revenues. Research, Development and Manufacturing Operations Costs: Research, development and manufacturing operations expenses were approximately $4.8 million and $6.6 million for the years ended December 31, 2017 and 2016 , respectively. Research, development and manufacturing operations expenses include: 1) technology development costs, which include expenses incurred in researching new technology, improving existing technology and performing federal government research and development contracts, 2) product development costs, which include expenses incurred in developing new products and lowering product design costs, and 3) pre-production and production costs, which include engineering efforts to improve production processes, material yields and equipment utilization, and manufacturing efforts to produce saleable product. Research, development and manufacturing operations costs are expensed as incurred, with the exception of costs related to inventoried raw materials, work-in-process and finished goods, which are expensed as Cost of revenue as products are sold. Marketing and Advertising Costs: The Company advertises in print, television, online and through social media. The Company will also authorize customers to run advertising campaigns on its behalf through various media outlets. Marketing and advertising costs are expensed as incurred. Marketing and advertising expenses were $189,382 and $2,164,693 for the years ended December 31, 2017 and 2016 , respectively. Share-Based Compensation: The Company measures and recognizes compensation expense for all share-based payment awards made to employees, officers, directors, and consultants based on estimated fair values. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service period in the Company’s Statements of Operations. Share-based compensation is based on awards ultimately expected to vest and is reduced for estimated forfeitures. Forfeitures are estimated at the time of grant and revised, as necessary, in subsequent periods if actual forfeitures differ from those estimates. For purposes of determining estimated fair value of share-based payment awards on the date of grant the Company uses the Black-Scholes option-pricing model (“Black-Scholes Model”) for option awards. The Black-Scholes Model requires the input of highly subjective assumptions. Because the Company’s employee stock options may have characteristics significantly different from those of traded options, and because changes in the subjective input assumptions can materially affect the fair value estimate, in management’s opinion, the existing models may not provide a reliable single measure of the fair value of the Company’s employee stock options. Management will continue to assess the assumptions and methodologies used to calculate estimated fair value of share-based compensation. Circumstances may change and additional data may become available over time, which result in changes to these assumptions and methodologies, which could materially impact the Company’s fair value determination. The Company estimates the fair value of its restricted stock awards as its stock price on the grant date. The accounting guidance for share-based compensation may be subject to further interpretation and refinement over time. There are significant differences among option valuation models, and this may result in a lack of comparability with other companies that use different models, methods and assumptions. If factors change and the Company employs different assumptions in the accounting for share-based compensation in future periods, or if the Company decides to use a different valuation model, the compensation expense the Company records in the future may differ significantly from the amount recorded in the current period and could materially affect its loss from operations, net loss and net loss per share. Income Taxes: Deferred income taxes are provided using the liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carry forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of the changes in tax laws and rates as of the date of enactment. Interest and penalties, if applicable, would be recorded in operations. The Company has analyzed filing positions in all of the federal and state jurisdictions where it is required to file income tax returns, as well as all open tax years (2014-2017) in these jurisdictions. The Company believes its income tax filing positions and deductions will be sustained on audit and does not anticipate any adjustments that will result in a material adverse effect on the Company’s financial condition, results of operations, or cash flows. Therefore, no reserves for uncertain income tax positions have been recorded. Net Loss per Common Share: Basic loss per share does not include dilution and is computed by dividing income available to common stockholders by the weighted average number of shares outstanding during the period. Diluted earnings per share reflect the potential securities that could share in the earnings of the Company, similar to fully diluted earnings per share. Common stock equivalents outstanding as of December 31, 2017 and 2016 of approximately 3.0 billion and 301.1 million shares have been omitted from loss per share because they are anti-dilutive. Common stock equivalents consist of stock options, unvested restricted stock, warrants, preferred stock, preferred stock make-whole dividend liability amounts (assuming the make-whole dividend liability is paid in common stock in lieu of cash), and convertible notes (assuming the amortization payments are paid in common stock in lieu of cash). Net loss per common share was the same for both basic and diluted methods for the periods ended December 31, 2017 and 2016 . Fair Value Estimates: Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The Company uses fair value hierarchy based on three levels of inputs, of which, the first two are considered observable and the last unobservable, to measure fair value: • Level 1 - Quoted prices in active markets for identical assets or liabilities. • Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. • Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Certain long-lived assets and current liabilities have been measured at fair value on a recurring and non-recurring basis. See Note 6. Property, Plant and Equipment, Note 10. Secured Promissory Note, Note 12. July 2016 Convertible Notes and Series H Preferred Stock, Note 13. October 2016 Convertible Notes and Exchange of Series A Preferred Stock, Note 13. St. George Convertible Note, Note 15. BayBridge Convertible Note, Note 17. Series E Preferred Stock, Note 18. Series F Preferred Stock, Note 19. Series G Preferred Stock, Note 20. Series I Preferred Stock and Series I Convertible Notes, Note 21. Series J Preferred Stock and Series J-1 Preferred Stock, and Note 23. Make-whole Dividend Liability. The carrying amount of our long term debt outstanding approximates fair value because our current borrowing rate does not materially differ from market rates for similar bank borrowings. The carrying value for cash and cash equivalents, restricted cash, accounts receivable, accounts payable, accrued expenses and other assets and liabilities approximate their fair values due to their short maturities. Related Party Transactions: One of the Company's named shareholders is Tertius Financial Group Pte Ltd, of which Mr. Victor Lee, President and Chief Executive Officer of the Company, is Managing Director and 50% shareholder. Accounting for transactions under these agreements is consistent with those defined in our Significant Accounting Policies. See Notes 11 and 27 for further information. Use of Estimates: The preparation of financial statements in conformity with U.S. generally accepted accounting principles ("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Recently Issued Accounting Standards In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) . The update will establish a comprehensive revenue recognition standard for virtually all industries in GAAP. ASU 2014-09 will change the amount and timing of revenue and cost recognition, implementation, disclosures and documentation. In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of Effective Date. The amendments in ASU 2015-14 defer the effective date of ASU 2014-09 for all entities by one year. ASU 2014-09 is now effective for the Company in fiscal year 2018. The Company has evaluated ASU 2014-09, and it will not have a material effect on the Company’s consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) . ASU 2016-02 requires lessees to recognize all leases, including operating leases, on the balance sheet as a lease asset or lease liability, unless the lease is a short-term lease. ASU 2016-02 also requires additional disclosures regarding leasing arrangements. ASU 2016-02 is effective for interim periods and fiscal years beginning after December 15, 2018, and early application is permitted. The Company continues to evaluate the impact, that the adoption of this guidance will have on its consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting , which simplifies several aspects of the accounting for share-based payment transactions, including 1) accounting for income taxes, 2) classification of excess tax benefits in the statement of cash flows, 3) forfeitures, 4) minimum statutory tax withholding requirements, 5) cash flow classification of employee taxes withheld in the form of shares, 6) the practical expedient for estimating the expected term, and 7) intrinsic value. The guidance is effective for annual reporting periods beginning after December 15, 2016, and interim periods within those annual periods. The implementation of ASU 2016-09 did not have a material effect on the Company's consolidated financial statements. In May 2017, the FASB issued ASU No. 2017-09, Compensation - Stock Compensation (Topic 718) . ASU 2017-09 provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. ASU 2017-09 is effective for interim periods and fiscal years beginning after December 15, 2017, and early application is permitted. The Company continues to evaluate the impact, if any, that the adoption of this guidance will have on its consolidated financial statements, but does not expect the effect, if any, will be material. In July 2017, the FASB issued ASU No. 2017-11 Part I, Earnings Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480), Derivatives and Hedging (Topic 815) . ASU 2017-11 Part I changes the classification analysis of certain equity linked financial instruments with down round features. ASU 2017-11 Part I is effective, for public business entities, for interim periods and fiscal years beginning after December 15, 2018, and early application is permitted. The Company is currently evaluating the impact, if any, that the adoption of this guidance will have on its consolidated financial statements. |
Liquidity, Continued Operations
Liquidity, Continued Operations, and Going Concern | 12 Months Ended |
Dec. 31, 2017 | |
LIQUIDITY AND CONTINUED OPERATIONS [Abstract] | |
Liquidity, Continued Operations, and Going Concern | LIQUIDITY, CONTINUED OPERATIONS, AND GOING CONCERN During the years ended December 31, 2017 and 2016 , the Company entered into multiple financing agreements to fund operations. Further discussion of these transactions can be found in Notes 8, 10, 11, 12, 13, 14, 15, 17, 18, 19, 20, 21, and 22. The Company has continued PV production at its manufacturing facility. The Company does not expect that sales revenue and cash flows will be sufficient to support operations and cash requirements until it has fully implemented its product strategy. During the year ended December 31, 2017 the Company used approximately $12.6 million in cash for operations. The Company's primary significant long term cash obligation consists of a note payable of approximately $5.5 million to a financial institution secured by a mortgage on its headquarters and manufacturing building in Thornton, Colorado. Total payments of approximately $0.7 million , including principal and interest, will come due in the remainder of 2017 . The Company’s consolidated financial statements have been prepared assuming that it will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business. As of December 31, 2017 , the Company has negative working capital. As such, cash liquidity sufficient for the year ending December 31, 2018 will require additional financing. The Company continues to accelerate sales and marketing efforts related to its consumer and military solar products and specialty PV application strategies through expansion of its sales and distribution channels. The Company has begun activities related to securing additional financing through strategic or financial investors, but there is no assurance the Company will be able to raise additional capital on acceptable terms or at all. If the Company's revenues do not increase rapidly, and/or additional financing is not obtained, the Company will be required to significantly curtail operations to reduce costs and/or sell assets. Such actions would likely have an adverse impact on the Company's future operations. As a result of the Company’s recurring losses from operations, and the need for additional financing to fund its operating and capital requirements, there is uncertainty regarding the Company’s ability to maintain liquidity sufficient to operate its business effectively, which raises substantial doubt as to the Company’s ability to continue as a going concern. Management cannot provide any assurances that the Company will be successful in accomplishing any of its plans. These consolidated financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern. |
Trade Receivables
Trade Receivables | 12 Months Ended |
Dec. 31, 2017 | |
Receivables [Abstract] | |
Trade Receivables | TRADE RECEIVABLES Trade receivables, net consist of amounts generated from product sales and government contracts. Accounts receivable totaled $6,658 and $549,204 as of December 31, 2017 and 2016 , respectively. Provisional Indirect Cost Rates - The Company bills the government under cost-based research and development contracts at provisional billing rates which permit the recovery of indirect costs. These rates are subject to audit on an annual basis by the government agencies’ cognizant audit agency. The cost audit may result in the negotiation and determination of the final indirect cost rates. In the opinion of management, re-determination of any cost-based contracts will not have a material effect on the Company’s financial position or results of operations. |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | PROPERTY, PLANT AND EQUIPMENT The following table summarizes property, plant and equipment as of December 31, 2017 and December 31, 2016 : As of December 31, 2017 2016 Building $ 5,828,960 $ 5,828,960 Furniture, fixtures, computer hardware and computer software 489,421 489,421 Manufacturing machinery and equipment 30,327,481 30,321,079 Depreciable property, plant and equipment 36,645,862 36,639,460 Less: Accumulated depreciation and amortization (32,013,686 ) (30,983,448 ) Net property, plant and equipment $ 4,632,176 $ 5,656,012 The Company analyzes its long-lived assets for impairment, both individually and as a group, whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. Depreciation expense for the years ended December 31, 2017 and 2016 was $1,030,237 and $3,486,741 , respectively. Depreciation expense is recorded under “Depreciation and amortization expense” in the Consolidated Statements of Operations. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2017 | |
Inventory Disclosure [Abstract] | |
Inventories | INVENTORIES Inventories consisted of the following at December 31, 2017 and December 31, 2016 : As of December 31, 2017 2016 Raw materials $ 689,000 $ 833,000 Work in process 12,000 635,000 Finished goods 337,000 1,102,000 Total $ 1,038,000 $ 2,570,000 |
Notes Payable
Notes Payable | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Notes Payable | NOTES PAYABLE On February 24, 2017 , the Company entered into an agreement with a vendor to convert the balance of their account into three notes payable in the aggregate amount of $765,784 . The notes bear interest of 6% per annum and matures on February 24, 2018 ; all outstanding principal and accrued interest is due and payable upon maturity. As of December 31, 2017 , the Company had not made any payments on these notes and the accrued interest was $39,565 . As of the date of this filing, this note has matured and is due and payable on demand. On February 27, 2017 , the Company entered into an agreement with a vendor to convert the balance of their account into a note payable in the amount of $49,500 . The note bears interest of 6% per annum and matures on September 27, 2017 ; all outstanding principal and accrued interest is due and payable upon maturity. On September 27, 2017 , the Company paid the note, plus $1,725 in accrued interest, in full. On March 23, 2017 , the Company entered into an agreement with a vendor to convert the balance of their account into a note payable in the amount of $356,742 . The note bears interest of 5% per annum and matures on October 23, 2017 ; all outstanding principal and accrued interest is due and payable upon maturity. On October 23, 2017 , the Company amended its promissory note with this vendor. The amendment extended the note's maturity to November 6, 2017 . Again on December 12, 2017 , the Company amended its promissory note with this vendor. The amendment extended the note's maturity to March 31, 2018 . As of December 31, 2017 , the Company had not made any payments on the note and the accrued interest was $13,830 . On June 30, 2017 , the Company entered into an agreement with a vendor to convert the balance of their account into a note payable in the amount of $250,000 . The note bears interest of 5% per annum and matures on February 28, 2018 ; all outstanding principal and accrued interest is due and payable upon maturity. As of December 31, 2017 , the Company had not made any payments on these notes and the accrued interest was $6,301 . As of the date of this filing, this note has matured and is due and payable on demand. On September 30, 2017 , the Company entered into a settlement agreement with a customer to convert the credit balance of their account into a note payable in the amount of $215,234 . The note bears interest of 5% per annum and matures on September 30, 2018 . Per the settlement agreement, monthly payments of $18,426 were to commence on October 30, 2017 . As of December 31, 2017 , one of the monthly payments had been made and the remaining principal and interest balances were $197,705 and $2,540 , respectively. SECURED PROMISSORY NOTE On November 30, 2017 , the Company, entered into a note purchase and exchange agreement (the “Note SPA”) with Global Ichiban Ltd (“Investor”), for the private placement of up to $2,000,000 of the Company’s Secured Convertible Promissory Notes (“Notes”) in exchange for $2,000,000 of gross proceeds in several tranches through June 2018, The closing of each tranche is conditioned upon the Company having an average daily trading volume for its Common Stock of at least $50,000 for the 20 trading day period preceding such future tranche closing dates. Pursuant to the terms of the Note SPA, the Company and the Investor also agreed to exchange certain outstanding securities held by the Investor for additional Notes. As of November 30, 2017 , the Investor surrendered for cancellation (i) its outstanding promissory note dated September 13, 2017 ( $3,359,539 principal and accrued interest), (ii) its outstanding promissory note dated October 31, 2017 ( $252,466 principal and accrued interest), and (iii) its 400 shares of outstanding Series J Preferred Stock ( $445,222 of capital and accrued dividends). In exchange, the Company issued to the Investor $4,057,227 aggregate principal amount of additional Notes. Please refer to Note 11 for further discussion on the canceled promissory notes and Note 21 on the canceled Series J Preferred Stock shares. Of the Notes issued on November 30, 2017 , $3,359,539 aggregate principal amount will mature on December 15, 2020 . Principal and interest will be payable in 36 equal monthly installments beginning January 15, 2018 . Of the Notes issued on November 30, 2017 , $697,688 aggregate principal amount will mature on November 30, 2018 . Principal and interest will be payable upon maturity. The $2,000,000 aggregate principal amount of Notes to be issued in the future in tranches pursuant to the Note SPA will mature on the first anniversary of the respective issuance date. Principal and interest will be payable upon maturity. As of December 31, 2017 , the closing dates, closing amounts, and maturity dates on completed Note SPA tranches are as follows: Closing Date Closing Amount Maturity Date 11/30/2017 $ 250,000 11/30/2018 12/28/2017 $ 250,000 12/28/2018 The Notes will be secured by a security interest on substantially all of the Company’s assets, bear interest at a rate of 12% per annum and contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the Notes, and (ii) bankruptcy or insolvency of the Company. There are no registration rights applicable to the Notes. All principal and accrued interest on the Notes are convertible at any time, in whole or in part, at the option of the Investor into shares of Common Stock at a variable conversion price equal to the lowest of (i) 85% of the average VWAP for the shares over the prior 5 trading days, (ii) the closing bid price for the shares on the prior trading day, or (iii) $0.002 per share The Notes may not be converted and shares of Common Stock may not be issued pursuant to the Notes if, after giving effect to the conversion or issuance, the holder together with its affiliates would beneficially own in excess of 9.99% of the outstanding shares of Common Stock. As of December 31, 2017 , the principal and interest balance of the Notes were $4,557,227 and $44,134 , respectively Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Notes were deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The derivative associated with the Notes approximates management’s estimate of the fair value of the embedded derivative liability based on using a Monte Carlo simulation following a Geometric Brownian Motion with the following assumptions identified below. Due to the varying terms and varying issue dates, the tranches of this instrument were broken into three separate instruments for valuation purposes. 1) The first valuation was done on the November 30, 2017 Note with term of three years. Management's analysis, using the following assumptions: annual volatility of 63% present value discount rate of 12% and a dividend yield of 0% , resulted in a fair value of the embedded derivative associated with this Note of $2,756,074 as of November 30, 2017. The value of the embedded derivative associated with the Note was recorded as a debt discount. 2) The second valuation was done on the group of Notes dated November 30, 2017 , that had a term of one year. Management's analysis, using the following assumptions: annual volatility of 67% present value discount rate of 12% and a dividend yield of 0% , resulted in a fair value of the embedded derivative associated with these Notes of $943,735 as of November 30, 2017. The value of the embedded derivative associated with the Note was recorded as a debt discount. 3) The third valuation was done on the Note dated December 28, 2017 , which had a term of one year. Management's analysis, using the following assumptions: annual volatility of 65% present value discount rate of 12% and a dividend yield of 0% , resulted in a fair value of the embedded derivative associated with this Note of $267,008 as of December 28, 2017. Since the value of the derivative was more than the liability, the entire liability of $250,000 was recorded as a debt discount to be amortized with the liability. The remaining balance of $17,008 was charged to interest expense. The derivative liability associated with the Notes is subject to revaluation on a quarterly basis to reflect the market value change of the embedded conversion option. At December 31, 2017 , the Company conducted a fair value assessment of the embedded derivative associated with the three valuation groups discussed above. 1) For the November 30, 2017 3yr Note: Management conducted a fair value assessment with the following assumptions: annual volatility of 63% present value discount rate of 12% and a dividend yield of 0% as of December 31, 2017 . As a result of the fair value assessment, the Company recorded a loss of $985,928 as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Consolidated Statements of Operations to properly reflect the fair value of the embedded derivative of $3,742,002 as of December 31, 2017 . 2) For the November 30, 2017 1yr Notes: Management conducted a fair value assessment with the following assumptions: annual volatility of 60% present value discount rate of 12% and a dividend yield of 0% as of December 31, 2017 . As a result of the fair value assessment, the Company recorded a gain of $55,567 as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Consolidated Statements of Operations to properly reflect the fair value of the embedded derivative of $888,168 as of December 31, 2017 . 3) There were no changes to the December 28, 2017 1yr note, as there was only one trading day for the year following the issuance. During the fourth quarter of 2017, a net loss of $930,361 had been recorded to reflect the total derivative liability of $4,897,178 as of December 31, 2017 . PROMISSORY NOTES Tertius Financial Group Notes and Exchange On August 29, 2016 , the Company entered into a note purchase agreement with Tertius Financial Group Pte. Ltd. ("TFG”) for the private placement of $330,000 of the Company’s original issue discount notes with an original maturity date of November 29, 2016 . The notes bear interest of 6% per annum and principal and interest on the notes are payable upon maturity. The notes are unsecured and not convertible into equity shares of the Company. On December 6, 2016 , the Company issued a new $600,000 original issue discount note to TFG in exchange for (i) $200,000 of additional gross proceeds and (ii) cancellation of the existing outstanding $330,000 note. The new TFG note bears interest at a rate of 6% per annum and matures on December 31, 2017 . Principal and interest on the new TFG note is payable at maturity. Following the transaction, the outstanding balance of the new note was $602,000 (including accrued and unpaid interest) with a discount of $60,000 . On January 19, 2017 , the Company issued 333,333,333 shares of unregistered common stock in a private placement to TFG pursuant to a Securities Purchase Agreement (the “SPA”). Pursuant to the SPA, the Company issued the 333,333,333 shares to TFG in exchange for cancellation of its $600,000 promissory note (including accrued interest of $4,340 ) that was issued by the Company on December 6, 2016 . The SPA does not provide any registration rights for the shares issued to TFG. TFG is a Singapore based entity controlled and 50% owned by Ascent’s President & CEO, Victor Lee, and owns approximately 3% of the Company's outstanding shares at December 31, 2017 . Offering of Unsecured Promissory Notes Between December 2016 and April 2017, the Company initiated eleven non-convertible, unsecured promissory notes with a private investor with varying principal amounts aggregating to $3,400,000 . The promissory notes bear interest of 12% per annum and mature six months from the respective dates of issuance, ranging from June 2, 2017 to October 21, 2017. Unless paid in advance, the principal and interest of these promissory notes are payable upon maturity. The notes are not convertible into equity shares of the Company and are unsecured. Between June and August, 2017, eight of the promissory notes described above matured. The Company and the private investor agreed to pay the interest accrued on these notes, as of the maturity dates, and extend the notes another three months without the Company being in default. Through August 30, 2017, $143,148 interest was paid. On September 13, 2017 , the Company and the investor entered into a Promissory Note Exchange Agreement. Pursuant to the agreement, the Investor exchanged and canceled the eleven outstanding promissory notes (with an aggregate principal and accrued interest of $3,504,199 ) for one new promissory note having a principal amount of approximately $3,504,199 . The new note has a term of three years, bears interest at a rate of 12% per annum, and calls for monthly installment payments of $116,390 commencing on October 13, 2017. The Company has the option to pay monthly installment amounts in the form of shares of common stock. Payments in the form of shares would be calculated using a variable conversion price equal to the lowest of (i) 85% of the average VWAP for the shares over the prior five trading days, (ii) the closing bid price for the shares on the prior trading day, or (iii) $0.004 per share. The Company may not make payments in the form of shares of Common Stock if, after giving effect to the issuance, the holder together with its affiliates would beneficially own in excess of 9.99% of the outstanding shares of Common Stock. On November 30, 2017 , the terms of this note were canceled and the remaining principal and accrued interest balance of $3,359,539 was combined with other instruments into a new Securities Purchase Agreement and secured note with the same investor. Please see Note. 10 for more information. Offering of Unsecured, Non-Convertible Notes During October 2016, the Company received $420,000 from a separate private investor. These funds, along with $250,000 of additional funding, were rolled into a promissory note, executed on January 17, 2017 , in the amount of $700,000 issued with a discount of $30,000 which will be charged to interest expense ratably over the term of the note. The note bears interest at 12% per annum and matures on July 17, 2017 . Principal and interest on this note are payable at maturity. This note is not convertible into equity shares of the Company and is unsecured. On June 30, 2017 , the Company and the private investor agreed to a twelve month payment plan on the balance of this promissory note. Interest will continue to accrue on this note at 12% per annum and payments of approximately $62,000 will be made monthly beginning in July 2017. Four monthly payments were made between July and October of 2017. As of December 31, 2017 , $205,563 of principal and $45,414 of interest had been paid on this note. The outstanding principal and accrued interest balances on the note as of December 31, 2017 were $494,437 and $27,126 , respectively. On April 6, 2017 , the Company initiated a non-convertible, unsecured promissory note with a private investor for $103,000 in exchange for proceeds of $100,000 . The discount of $3,000 will be charged to interest expense ratably over the term of the note. The promissory note bears interest of 10% per annum and matures on October 6, 2017 . On October 6, 2017 , the Company and its investor entered into a Promissory Note Exchange Agreement to convert a promissory note with a principal balance of $103,000 and accrued interest of $5,233 in to common shares. Per the terms of the agreement, the promissory note was canceled and 72,500,000 shares were issued. On May 8, 2017 , the Company initiated a non-convertible, unsecured promissory note with a private investor for $125,000 . The promissory note bears interest of 12% per annum and matures on September 8, 2017 . On September 8, 2017 , the Company redeemed this note, in full, for cash. On October 31, 2017 , the Company initiated a non-convertible, unsecured promissory note with a private investor for $250,000 . The promissory note bears interest of 12% per annum and matures on January 31, 2018 . On November 30, 2017 , the terms of this note were canceled and the remaining principal and accrued interest balance of $252,466 was combined with other instruments into a new Securities Purchase Agreement and secured note with the same investor. Please see Note. 10 for more information. On November 16, 2017 , the Company initiated a non-convertible, unsecured promissory note with a private investor for $275,000 . The promissory note was issued with an original issue discount of $25,000 , resulting in proceeds to the company of $250,000 . The note does not have a stated interest rate and matures on December 18, 2017 . As of December 31, 2017 , no payments had been made on this note and the discount had been recorded as interest expense. During December 2017, the Company received aggregate proceeds of $177,500 , from a private investor. These proceeds were incorporated into a promissory note on January 31, 2018 . Please refer to Note 30 for further information on this note. ST. GEORGE CONVERTIBLE NOTE On September 8, 2017 , the Company entered into a securities purchase agreement with St. George Investments, LLC (“Investor”), for the private placement of $1,725,000 principal amount of the Company’s Original Issue Discount Convertible Promissory Notes. On September 11, 2017 , the Company sold and issued $1,725,000 principal amount of the convertible notes to the Investor in exchange for $1,500,000 of gross proceeds, and paid $20,000 in financing costs. The original issue discount of $225,000 , and the financing fee, will be charged to interest expense, ratably, over the life of the note. Unless earlier converted or prepaid, the convertible notes will mature on March 11, 2019 . The notes do not bear interest in the absence of an event of default. For the first six months after the issuance of the notes, the Company will make a monthly cash repayment on the notes of approximately $96,000 . Thereafter, the Investor may request that the Company make monthly partial redemptions of the note up to $150,000 per month. If the Investor does not request the full $150,000 redemption amount in any one month, the unused portion of such monthly redemption amount can be added to future monthly redemption amounts. But in no event can the amount requested by the Investor for any one month exceed $275,000 . Redemption amounts are payable by the Company in cash. Beginning ten months after the issuance of the convertible notes, cash redemption payments by the Company will be subject to a 15% redemption premium. Beginning six months after the issuance of the convertible notes, the Company also has the option (subject to customary equity conditions) to pay redemption amounts in the form of shares of common stock. Payments in the form of shares would be calculated using a variable conversion price equal to the lower of (i) 85% of the average VWAP for the shares over the prior 5 trading days or (ii) the closing bid price for the shares on the prior trading day. All principal and accrued interest on the Notes are convertible at any time, in whole or in part, at the option of the Investor into shares of Common Stock at a fixed conversion price of $0.004 per share. The Notes contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the Notes; and (ii) bankruptcy or insolvency of the Company. Upon the occurrence of an event of default, the Notes will begin to bear interest at the rate of 22% per annum. In addition, upon the occurrence of an event of default, the Investor has the option to increase the outstanding balance of the Notes by 25% . In connection with the closing under the Note SPA, the Company issued $37,500,000 unregistered shares of common stock to the Investor as an origination fee. The closing stock price on the date of close was $0.0017 resulting in an interest expense of $63,750 being recorded as of the date of close. The Notes may not be converted and shares of Common Stock may not be issued pursuant to the Notes if, after giving effect to the conversion or issuance, the holder together with its affiliates would beneficially own in excess of 4.99% of the outstanding shares of Common Stock. Per the conditions of the SPA, a reserve of 1.88 billion shares was set up out of our authorized and unissued shares. During the fourth quarter of 2017, we made cash payments of $191,667 on this note, and as of December 31, 2017 , the principal balance on this note was $1,705,833 . In lieu of making the December 2017 payment, the share reserve was increased by 3 billion shares. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Notes were deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At closing, a derivative liability and a corresponding debt discount in the amount of $468,095 was recorded. The derivative liability associated with the Notes is subject to revaluation on a quarterly basis to reflect the market value change of the embedded conversion option. At December 31, 2017 , the Company conducted a fair value assessment of the embedded derivative associated with the Notes. As a result of the fair value assessment, the Company recorded a $151,504 loss as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations for the three months ended December 31, 2017 . The net gain recorded for the year ended December 31, 2017 was $73,815 , to properly reflect the fair value of the embedded derivative of $394,280 as of December 31, 2017 . The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The derivative associated with the Notes approximates management’s estimate of the fair value of the embedded derivative liability at December 31, 2017 based on using a Monte Carlo simulation following a Geometric Brownian Motion with the following assumptions: annual volatility of 62% present value discount rate of 12% and dividend yield of 0% . BAYBRIDGE CONVERTIBLE NOTE On December 6, 2017 , the Company entered into a securities exchange agreement (the “Exchange Agreement”) with BayBridge Capital Fund LP (“BayBridge”). Pursuant to the terms of the Exchange Agreement, the Investor agreed to surrender and exchange 675 shares of outstanding Series J Preferred Stock ( $755,417 of capital and accrued dividends). In exchange, the Company issued to the Investor an unsecured promissory note with an aggregate principal amount of $840,000 (the “Exchange Note”), with an original issue discount of $84,583 . Please refer to Note 21 for further discussion on the Series J Preferred Stock. The Exchange Note is unsecured, has no applicable registration rights, bears interest at a rate of 12% per annum, matures on December 6, 2018 , and contains standard and customary events of default including but not limited to: (i) failure to make payments when due under the Exchange Note, and (ii) bankruptcy or insolvency of the Company. Principal and interest are payable upon maturity. Payments of principal and accrued interest on the Exchange Note are payable in cash or, at the option of the Company, in shares of Common Stock at a variable conversion price equal to the lowest of (i) 85% of the average VWAP for the shares over the prior 5 trading days, (ii) the closing bid price for the shares on the prior trading day, or (iii) $0.003 per share. Payments in shares of Common Stock may not be issued pursuant to the Exchange Note if, after giving effect to the conversion or issuance, the holder together with its affiliates would beneficially own in excess of 9.99% of the outstanding shares of Common Stock. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Exchange Note was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. December 6, 2017 , the derivative liability associated with the promissory note was $1,048,311 . Since the value of the derivative was more than the liability and the original issue discount, the entire undiscounted liability of $755,417 was recorded as a debt discount to be amortized over the life of the liability. The remaining $292,894 was charged to interest expense. The derivative liability associated with the Exchange Note is subject to revaluation on a quarterly basis to reflect the market value change of the embedded conversion option. At December 31, 2017 , the Company conducted a fair value assessment of the embedded derivative associated with the Exchange Note. As a result of the fair value assessment, the Company recorded a $505,578 gain as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations, for the year ended December 31, 2017 , to properly reflect the fair value of the embedded derivative of $542,733 as of December 31, 2017 . The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The derivative associated with the Exchange Note approximates management’s estimate of the fair value of the embedded derivative liability at December 31, 2017 based on using a Monte Carlo simulation following a Geometric Brownian Motion with the following assumptions: annual volatility of 61% , present value discount rate of 12% and dividend yield of 0% . As of December 31, 2017 , principal of $275,000 had been converted into 404,411,765 shares of common stock and no cash payments of principal or interest had been made. The principal and accrued interest balances as of December 31, 2017 were $565,000 and $4,825 , respectively. |
Debt
Debt | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Debt | DEBT On February 8, 2008, the Company acquired a manufacturing and office facility in Thornton, Colorado, for approximately $5.5 million . The purchase was financed by a promissory note, deed of trust and construction loan agreement (the “Construction Loan”) with the Colorado Housing and Finance Authority (“CHFA”), which provided the Company borrowing availability of up to $7.5 million for the building and building improvements. In 2009, the Construction Loan was converted to a permanent loan pursuant to a Loan Modification Agreement between the Company and CHFA (the “Permanent Loan”). The Permanent Loan, collateralized by the building, has an interest rate of 6.6% and the principal will be amortized through its term to January 2028. Further, pursuant to certain covenants in the Permanent Loan, the Company may not, among other things, without CHFA’s prior written consent (which by the terms of the deed of trust is subject to a reasonableness requirement): create or incur additional indebtedness (other than obligations created or incurred in the ordinary course of business); merge or consolidate with any other entity; or make loans or advances to the Company’s officers, shareholders, directors or employees. On November 1, 2016, the Company and the CFHA agreed to modify the original agreement described above with the addition of a forbearance period. Per the modification agreement, no payments of principal and interest shall be due under the note during the forbearance period commencing on November 1, 2016 and continuing through April 1, 2017. The amount of interest that should have been paid by the Company during the forbearance period in the total amount of $180,043 shall be added to the outstanding principal balance of the note. As a result, on May 1, 2017, the principal balance of the note was $5,704,932 . Commencing on May 1, 2017, the monthly payments of principal and interest due under the note resumed at $57,801 , and the Company shall continue to make such monthly payments over the remaining term of the note ending on February 1, 2028. As of December 31, 2017 , future principal payments on long-term debt are due as follows: 2018 $ 343,395 2019 366,757 2020 391,709 2021 418,358 2022 446,821 Thereafter 3,494,779 $ 5,461,819 |
Secured Promissory Note
Secured Promissory Note | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Promissory Note | NOTES PAYABLE On February 24, 2017 , the Company entered into an agreement with a vendor to convert the balance of their account into three notes payable in the aggregate amount of $765,784 . The notes bear interest of 6% per annum and matures on February 24, 2018 ; all outstanding principal and accrued interest is due and payable upon maturity. As of December 31, 2017 , the Company had not made any payments on these notes and the accrued interest was $39,565 . As of the date of this filing, this note has matured and is due and payable on demand. On February 27, 2017 , the Company entered into an agreement with a vendor to convert the balance of their account into a note payable in the amount of $49,500 . The note bears interest of 6% per annum and matures on September 27, 2017 ; all outstanding principal and accrued interest is due and payable upon maturity. On September 27, 2017 , the Company paid the note, plus $1,725 in accrued interest, in full. On March 23, 2017 , the Company entered into an agreement with a vendor to convert the balance of their account into a note payable in the amount of $356,742 . The note bears interest of 5% per annum and matures on October 23, 2017 ; all outstanding principal and accrued interest is due and payable upon maturity. On October 23, 2017 , the Company amended its promissory note with this vendor. The amendment extended the note's maturity to November 6, 2017 . Again on December 12, 2017 , the Company amended its promissory note with this vendor. The amendment extended the note's maturity to March 31, 2018 . As of December 31, 2017 , the Company had not made any payments on the note and the accrued interest was $13,830 . On June 30, 2017 , the Company entered into an agreement with a vendor to convert the balance of their account into a note payable in the amount of $250,000 . The note bears interest of 5% per annum and matures on February 28, 2018 ; all outstanding principal and accrued interest is due and payable upon maturity. As of December 31, 2017 , the Company had not made any payments on these notes and the accrued interest was $6,301 . As of the date of this filing, this note has matured and is due and payable on demand. On September 30, 2017 , the Company entered into a settlement agreement with a customer to convert the credit balance of their account into a note payable in the amount of $215,234 . The note bears interest of 5% per annum and matures on September 30, 2018 . Per the settlement agreement, monthly payments of $18,426 were to commence on October 30, 2017 . As of December 31, 2017 , one of the monthly payments had been made and the remaining principal and interest balances were $197,705 and $2,540 , respectively. SECURED PROMISSORY NOTE On November 30, 2017 , the Company, entered into a note purchase and exchange agreement (the “Note SPA”) with Global Ichiban Ltd (“Investor”), for the private placement of up to $2,000,000 of the Company’s Secured Convertible Promissory Notes (“Notes”) in exchange for $2,000,000 of gross proceeds in several tranches through June 2018, The closing of each tranche is conditioned upon the Company having an average daily trading volume for its Common Stock of at least $50,000 for the 20 trading day period preceding such future tranche closing dates. Pursuant to the terms of the Note SPA, the Company and the Investor also agreed to exchange certain outstanding securities held by the Investor for additional Notes. As of November 30, 2017 , the Investor surrendered for cancellation (i) its outstanding promissory note dated September 13, 2017 ( $3,359,539 principal and accrued interest), (ii) its outstanding promissory note dated October 31, 2017 ( $252,466 principal and accrued interest), and (iii) its 400 shares of outstanding Series J Preferred Stock ( $445,222 of capital and accrued dividends). In exchange, the Company issued to the Investor $4,057,227 aggregate principal amount of additional Notes. Please refer to Note 11 for further discussion on the canceled promissory notes and Note 21 on the canceled Series J Preferred Stock shares. Of the Notes issued on November 30, 2017 , $3,359,539 aggregate principal amount will mature on December 15, 2020 . Principal and interest will be payable in 36 equal monthly installments beginning January 15, 2018 . Of the Notes issued on November 30, 2017 , $697,688 aggregate principal amount will mature on November 30, 2018 . Principal and interest will be payable upon maturity. The $2,000,000 aggregate principal amount of Notes to be issued in the future in tranches pursuant to the Note SPA will mature on the first anniversary of the respective issuance date. Principal and interest will be payable upon maturity. As of December 31, 2017 , the closing dates, closing amounts, and maturity dates on completed Note SPA tranches are as follows: Closing Date Closing Amount Maturity Date 11/30/2017 $ 250,000 11/30/2018 12/28/2017 $ 250,000 12/28/2018 The Notes will be secured by a security interest on substantially all of the Company’s assets, bear interest at a rate of 12% per annum and contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the Notes, and (ii) bankruptcy or insolvency of the Company. There are no registration rights applicable to the Notes. All principal and accrued interest on the Notes are convertible at any time, in whole or in part, at the option of the Investor into shares of Common Stock at a variable conversion price equal to the lowest of (i) 85% of the average VWAP for the shares over the prior 5 trading days, (ii) the closing bid price for the shares on the prior trading day, or (iii) $0.002 per share The Notes may not be converted and shares of Common Stock may not be issued pursuant to the Notes if, after giving effect to the conversion or issuance, the holder together with its affiliates would beneficially own in excess of 9.99% of the outstanding shares of Common Stock. As of December 31, 2017 , the principal and interest balance of the Notes were $4,557,227 and $44,134 , respectively Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Notes were deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The derivative associated with the Notes approximates management’s estimate of the fair value of the embedded derivative liability based on using a Monte Carlo simulation following a Geometric Brownian Motion with the following assumptions identified below. Due to the varying terms and varying issue dates, the tranches of this instrument were broken into three separate instruments for valuation purposes. 1) The first valuation was done on the November 30, 2017 Note with term of three years. Management's analysis, using the following assumptions: annual volatility of 63% present value discount rate of 12% and a dividend yield of 0% , resulted in a fair value of the embedded derivative associated with this Note of $2,756,074 as of November 30, 2017. The value of the embedded derivative associated with the Note was recorded as a debt discount. 2) The second valuation was done on the group of Notes dated November 30, 2017 , that had a term of one year. Management's analysis, using the following assumptions: annual volatility of 67% present value discount rate of 12% and a dividend yield of 0% , resulted in a fair value of the embedded derivative associated with these Notes of $943,735 as of November 30, 2017. The value of the embedded derivative associated with the Note was recorded as a debt discount. 3) The third valuation was done on the Note dated December 28, 2017 , which had a term of one year. Management's analysis, using the following assumptions: annual volatility of 65% present value discount rate of 12% and a dividend yield of 0% , resulted in a fair value of the embedded derivative associated with this Note of $267,008 as of December 28, 2017. Since the value of the derivative was more than the liability, the entire liability of $250,000 was recorded as a debt discount to be amortized with the liability. The remaining balance of $17,008 was charged to interest expense. The derivative liability associated with the Notes is subject to revaluation on a quarterly basis to reflect the market value change of the embedded conversion option. At December 31, 2017 , the Company conducted a fair value assessment of the embedded derivative associated with the three valuation groups discussed above. 1) For the November 30, 2017 3yr Note: Management conducted a fair value assessment with the following assumptions: annual volatility of 63% present value discount rate of 12% and a dividend yield of 0% as of December 31, 2017 . As a result of the fair value assessment, the Company recorded a loss of $985,928 as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Consolidated Statements of Operations to properly reflect the fair value of the embedded derivative of $3,742,002 as of December 31, 2017 . 2) For the November 30, 2017 1yr Notes: Management conducted a fair value assessment with the following assumptions: annual volatility of 60% present value discount rate of 12% and a dividend yield of 0% as of December 31, 2017 . As a result of the fair value assessment, the Company recorded a gain of $55,567 as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Consolidated Statements of Operations to properly reflect the fair value of the embedded derivative of $888,168 as of December 31, 2017 . 3) There were no changes to the December 28, 2017 1yr note, as there was only one trading day for the year following the issuance. During the fourth quarter of 2017, a net loss of $930,361 had been recorded to reflect the total derivative liability of $4,897,178 as of December 31, 2017 . PROMISSORY NOTES Tertius Financial Group Notes and Exchange On August 29, 2016 , the Company entered into a note purchase agreement with Tertius Financial Group Pte. Ltd. ("TFG”) for the private placement of $330,000 of the Company’s original issue discount notes with an original maturity date of November 29, 2016 . The notes bear interest of 6% per annum and principal and interest on the notes are payable upon maturity. The notes are unsecured and not convertible into equity shares of the Company. On December 6, 2016 , the Company issued a new $600,000 original issue discount note to TFG in exchange for (i) $200,000 of additional gross proceeds and (ii) cancellation of the existing outstanding $330,000 note. The new TFG note bears interest at a rate of 6% per annum and matures on December 31, 2017 . Principal and interest on the new TFG note is payable at maturity. Following the transaction, the outstanding balance of the new note was $602,000 (including accrued and unpaid interest) with a discount of $60,000 . On January 19, 2017 , the Company issued 333,333,333 shares of unregistered common stock in a private placement to TFG pursuant to a Securities Purchase Agreement (the “SPA”). Pursuant to the SPA, the Company issued the 333,333,333 shares to TFG in exchange for cancellation of its $600,000 promissory note (including accrued interest of $4,340 ) that was issued by the Company on December 6, 2016 . The SPA does not provide any registration rights for the shares issued to TFG. TFG is a Singapore based entity controlled and 50% owned by Ascent’s President & CEO, Victor Lee, and owns approximately 3% of the Company's outstanding shares at December 31, 2017 . Offering of Unsecured Promissory Notes Between December 2016 and April 2017, the Company initiated eleven non-convertible, unsecured promissory notes with a private investor with varying principal amounts aggregating to $3,400,000 . The promissory notes bear interest of 12% per annum and mature six months from the respective dates of issuance, ranging from June 2, 2017 to October 21, 2017. Unless paid in advance, the principal and interest of these promissory notes are payable upon maturity. The notes are not convertible into equity shares of the Company and are unsecured. Between June and August, 2017, eight of the promissory notes described above matured. The Company and the private investor agreed to pay the interest accrued on these notes, as of the maturity dates, and extend the notes another three months without the Company being in default. Through August 30, 2017, $143,148 interest was paid. On September 13, 2017 , the Company and the investor entered into a Promissory Note Exchange Agreement. Pursuant to the agreement, the Investor exchanged and canceled the eleven outstanding promissory notes (with an aggregate principal and accrued interest of $3,504,199 ) for one new promissory note having a principal amount of approximately $3,504,199 . The new note has a term of three years, bears interest at a rate of 12% per annum, and calls for monthly installment payments of $116,390 commencing on October 13, 2017. The Company has the option to pay monthly installment amounts in the form of shares of common stock. Payments in the form of shares would be calculated using a variable conversion price equal to the lowest of (i) 85% of the average VWAP for the shares over the prior five trading days, (ii) the closing bid price for the shares on the prior trading day, or (iii) $0.004 per share. The Company may not make payments in the form of shares of Common Stock if, after giving effect to the issuance, the holder together with its affiliates would beneficially own in excess of 9.99% of the outstanding shares of Common Stock. On November 30, 2017 , the terms of this note were canceled and the remaining principal and accrued interest balance of $3,359,539 was combined with other instruments into a new Securities Purchase Agreement and secured note with the same investor. Please see Note. 10 for more information. Offering of Unsecured, Non-Convertible Notes During October 2016, the Company received $420,000 from a separate private investor. These funds, along with $250,000 of additional funding, were rolled into a promissory note, executed on January 17, 2017 , in the amount of $700,000 issued with a discount of $30,000 which will be charged to interest expense ratably over the term of the note. The note bears interest at 12% per annum and matures on July 17, 2017 . Principal and interest on this note are payable at maturity. This note is not convertible into equity shares of the Company and is unsecured. On June 30, 2017 , the Company and the private investor agreed to a twelve month payment plan on the balance of this promissory note. Interest will continue to accrue on this note at 12% per annum and payments of approximately $62,000 will be made monthly beginning in July 2017. Four monthly payments were made between July and October of 2017. As of December 31, 2017 , $205,563 of principal and $45,414 of interest had been paid on this note. The outstanding principal and accrued interest balances on the note as of December 31, 2017 were $494,437 and $27,126 , respectively. On April 6, 2017 , the Company initiated a non-convertible, unsecured promissory note with a private investor for $103,000 in exchange for proceeds of $100,000 . The discount of $3,000 will be charged to interest expense ratably over the term of the note. The promissory note bears interest of 10% per annum and matures on October 6, 2017 . On October 6, 2017 , the Company and its investor entered into a Promissory Note Exchange Agreement to convert a promissory note with a principal balance of $103,000 and accrued interest of $5,233 in to common shares. Per the terms of the agreement, the promissory note was canceled and 72,500,000 shares were issued. On May 8, 2017 , the Company initiated a non-convertible, unsecured promissory note with a private investor for $125,000 . The promissory note bears interest of 12% per annum and matures on September 8, 2017 . On September 8, 2017 , the Company redeemed this note, in full, for cash. On October 31, 2017 , the Company initiated a non-convertible, unsecured promissory note with a private investor for $250,000 . The promissory note bears interest of 12% per annum and matures on January 31, 2018 . On November 30, 2017 , the terms of this note were canceled and the remaining principal and accrued interest balance of $252,466 was combined with other instruments into a new Securities Purchase Agreement and secured note with the same investor. Please see Note. 10 for more information. On November 16, 2017 , the Company initiated a non-convertible, unsecured promissory note with a private investor for $275,000 . The promissory note was issued with an original issue discount of $25,000 , resulting in proceeds to the company of $250,000 . The note does not have a stated interest rate and matures on December 18, 2017 . As of December 31, 2017 , no payments had been made on this note and the discount had been recorded as interest expense. During December 2017, the Company received aggregate proceeds of $177,500 , from a private investor. These proceeds were incorporated into a promissory note on January 31, 2018 . Please refer to Note 30 for further information on this note. ST. GEORGE CONVERTIBLE NOTE On September 8, 2017 , the Company entered into a securities purchase agreement with St. George Investments, LLC (“Investor”), for the private placement of $1,725,000 principal amount of the Company’s Original Issue Discount Convertible Promissory Notes. On September 11, 2017 , the Company sold and issued $1,725,000 principal amount of the convertible notes to the Investor in exchange for $1,500,000 of gross proceeds, and paid $20,000 in financing costs. The original issue discount of $225,000 , and the financing fee, will be charged to interest expense, ratably, over the life of the note. Unless earlier converted or prepaid, the convertible notes will mature on March 11, 2019 . The notes do not bear interest in the absence of an event of default. For the first six months after the issuance of the notes, the Company will make a monthly cash repayment on the notes of approximately $96,000 . Thereafter, the Investor may request that the Company make monthly partial redemptions of the note up to $150,000 per month. If the Investor does not request the full $150,000 redemption amount in any one month, the unused portion of such monthly redemption amount can be added to future monthly redemption amounts. But in no event can the amount requested by the Investor for any one month exceed $275,000 . Redemption amounts are payable by the Company in cash. Beginning ten months after the issuance of the convertible notes, cash redemption payments by the Company will be subject to a 15% redemption premium. Beginning six months after the issuance of the convertible notes, the Company also has the option (subject to customary equity conditions) to pay redemption amounts in the form of shares of common stock. Payments in the form of shares would be calculated using a variable conversion price equal to the lower of (i) 85% of the average VWAP for the shares over the prior 5 trading days or (ii) the closing bid price for the shares on the prior trading day. All principal and accrued interest on the Notes are convertible at any time, in whole or in part, at the option of the Investor into shares of Common Stock at a fixed conversion price of $0.004 per share. The Notes contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the Notes; and (ii) bankruptcy or insolvency of the Company. Upon the occurrence of an event of default, the Notes will begin to bear interest at the rate of 22% per annum. In addition, upon the occurrence of an event of default, the Investor has the option to increase the outstanding balance of the Notes by 25% . In connection with the closing under the Note SPA, the Company issued $37,500,000 unregistered shares of common stock to the Investor as an origination fee. The closing stock price on the date of close was $0.0017 resulting in an interest expense of $63,750 being recorded as of the date of close. The Notes may not be converted and shares of Common Stock may not be issued pursuant to the Notes if, after giving effect to the conversion or issuance, the holder together with its affiliates would beneficially own in excess of 4.99% of the outstanding shares of Common Stock. Per the conditions of the SPA, a reserve of 1.88 billion shares was set up out of our authorized and unissued shares. During the fourth quarter of 2017, we made cash payments of $191,667 on this note, and as of December 31, 2017 , the principal balance on this note was $1,705,833 . In lieu of making the December 2017 payment, the share reserve was increased by 3 billion shares. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Notes were deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At closing, a derivative liability and a corresponding debt discount in the amount of $468,095 was recorded. The derivative liability associated with the Notes is subject to revaluation on a quarterly basis to reflect the market value change of the embedded conversion option. At December 31, 2017 , the Company conducted a fair value assessment of the embedded derivative associated with the Notes. As a result of the fair value assessment, the Company recorded a $151,504 loss as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations for the three months ended December 31, 2017 . The net gain recorded for the year ended December 31, 2017 was $73,815 , to properly reflect the fair value of the embedded derivative of $394,280 as of December 31, 2017 . The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The derivative associated with the Notes approximates management’s estimate of the fair value of the embedded derivative liability at December 31, 2017 based on using a Monte Carlo simulation following a Geometric Brownian Motion with the following assumptions: annual volatility of 62% present value discount rate of 12% and dividend yield of 0% . BAYBRIDGE CONVERTIBLE NOTE On December 6, 2017 , the Company entered into a securities exchange agreement (the “Exchange Agreement”) with BayBridge Capital Fund LP (“BayBridge”). Pursuant to the terms of the Exchange Agreement, the Investor agreed to surrender and exchange 675 shares of outstanding Series J Preferred Stock ( $755,417 of capital and accrued dividends). In exchange, the Company issued to the Investor an unsecured promissory note with an aggregate principal amount of $840,000 (the “Exchange Note”), with an original issue discount of $84,583 . Please refer to Note 21 for further discussion on the Series J Preferred Stock. The Exchange Note is unsecured, has no applicable registration rights, bears interest at a rate of 12% per annum, matures on December 6, 2018 , and contains standard and customary events of default including but not limited to: (i) failure to make payments when due under the Exchange Note, and (ii) bankruptcy or insolvency of the Company. Principal and interest are payable upon maturity. Payments of principal and accrued interest on the Exchange Note are payable in cash or, at the option of the Company, in shares of Common Stock at a variable conversion price equal to the lowest of (i) 85% of the average VWAP for the shares over the prior 5 trading days, (ii) the closing bid price for the shares on the prior trading day, or (iii) $0.003 per share. Payments in shares of Common Stock may not be issued pursuant to the Exchange Note if, after giving effect to the conversion or issuance, the holder together with its affiliates would beneficially own in excess of 9.99% of the outstanding shares of Common Stock. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Exchange Note was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. December 6, 2017 , the derivative liability associated with the promissory note was $1,048,311 . Since the value of the derivative was more than the liability and the original issue discount, the entire undiscounted liability of $755,417 was recorded as a debt discount to be amortized over the life of the liability. The remaining $292,894 was charged to interest expense. The derivative liability associated with the Exchange Note is subject to revaluation on a quarterly basis to reflect the market value change of the embedded conversion option. At December 31, 2017 , the Company conducted a fair value assessment of the embedded derivative associated with the Exchange Note. As a result of the fair value assessment, the Company recorded a $505,578 gain as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations, for the year ended December 31, 2017 , to properly reflect the fair value of the embedded derivative of $542,733 as of December 31, 2017 . The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The derivative associated with the Exchange Note approximates management’s estimate of the fair value of the embedded derivative liability at December 31, 2017 based on using a Monte Carlo simulation following a Geometric Brownian Motion with the following assumptions: annual volatility of 61% , present value discount rate of 12% and dividend yield of 0% . As of December 31, 2017 , principal of $275,000 had been converted into 404,411,765 shares of common stock and no cash payments of principal or interest had been made. The principal and accrued interest balances as of December 31, 2017 were $565,000 and $4,825 , respectively. |
Promissory Notes
Promissory Notes | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Promissory Note | NOTES PAYABLE On February 24, 2017 , the Company entered into an agreement with a vendor to convert the balance of their account into three notes payable in the aggregate amount of $765,784 . The notes bear interest of 6% per annum and matures on February 24, 2018 ; all outstanding principal and accrued interest is due and payable upon maturity. As of December 31, 2017 , the Company had not made any payments on these notes and the accrued interest was $39,565 . As of the date of this filing, this note has matured and is due and payable on demand. On February 27, 2017 , the Company entered into an agreement with a vendor to convert the balance of their account into a note payable in the amount of $49,500 . The note bears interest of 6% per annum and matures on September 27, 2017 ; all outstanding principal and accrued interest is due and payable upon maturity. On September 27, 2017 , the Company paid the note, plus $1,725 in accrued interest, in full. On March 23, 2017 , the Company entered into an agreement with a vendor to convert the balance of their account into a note payable in the amount of $356,742 . The note bears interest of 5% per annum and matures on October 23, 2017 ; all outstanding principal and accrued interest is due and payable upon maturity. On October 23, 2017 , the Company amended its promissory note with this vendor. The amendment extended the note's maturity to November 6, 2017 . Again on December 12, 2017 , the Company amended its promissory note with this vendor. The amendment extended the note's maturity to March 31, 2018 . As of December 31, 2017 , the Company had not made any payments on the note and the accrued interest was $13,830 . On June 30, 2017 , the Company entered into an agreement with a vendor to convert the balance of their account into a note payable in the amount of $250,000 . The note bears interest of 5% per annum and matures on February 28, 2018 ; all outstanding principal and accrued interest is due and payable upon maturity. As of December 31, 2017 , the Company had not made any payments on these notes and the accrued interest was $6,301 . As of the date of this filing, this note has matured and is due and payable on demand. On September 30, 2017 , the Company entered into a settlement agreement with a customer to convert the credit balance of their account into a note payable in the amount of $215,234 . The note bears interest of 5% per annum and matures on September 30, 2018 . Per the settlement agreement, monthly payments of $18,426 were to commence on October 30, 2017 . As of December 31, 2017 , one of the monthly payments had been made and the remaining principal and interest balances were $197,705 and $2,540 , respectively. SECURED PROMISSORY NOTE On November 30, 2017 , the Company, entered into a note purchase and exchange agreement (the “Note SPA”) with Global Ichiban Ltd (“Investor”), for the private placement of up to $2,000,000 of the Company’s Secured Convertible Promissory Notes (“Notes”) in exchange for $2,000,000 of gross proceeds in several tranches through June 2018, The closing of each tranche is conditioned upon the Company having an average daily trading volume for its Common Stock of at least $50,000 for the 20 trading day period preceding such future tranche closing dates. Pursuant to the terms of the Note SPA, the Company and the Investor also agreed to exchange certain outstanding securities held by the Investor for additional Notes. As of November 30, 2017 , the Investor surrendered for cancellation (i) its outstanding promissory note dated September 13, 2017 ( $3,359,539 principal and accrued interest), (ii) its outstanding promissory note dated October 31, 2017 ( $252,466 principal and accrued interest), and (iii) its 400 shares of outstanding Series J Preferred Stock ( $445,222 of capital and accrued dividends). In exchange, the Company issued to the Investor $4,057,227 aggregate principal amount of additional Notes. Please refer to Note 11 for further discussion on the canceled promissory notes and Note 21 on the canceled Series J Preferred Stock shares. Of the Notes issued on November 30, 2017 , $3,359,539 aggregate principal amount will mature on December 15, 2020 . Principal and interest will be payable in 36 equal monthly installments beginning January 15, 2018 . Of the Notes issued on November 30, 2017 , $697,688 aggregate principal amount will mature on November 30, 2018 . Principal and interest will be payable upon maturity. The $2,000,000 aggregate principal amount of Notes to be issued in the future in tranches pursuant to the Note SPA will mature on the first anniversary of the respective issuance date. Principal and interest will be payable upon maturity. As of December 31, 2017 , the closing dates, closing amounts, and maturity dates on completed Note SPA tranches are as follows: Closing Date Closing Amount Maturity Date 11/30/2017 $ 250,000 11/30/2018 12/28/2017 $ 250,000 12/28/2018 The Notes will be secured by a security interest on substantially all of the Company’s assets, bear interest at a rate of 12% per annum and contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the Notes, and (ii) bankruptcy or insolvency of the Company. There are no registration rights applicable to the Notes. All principal and accrued interest on the Notes are convertible at any time, in whole or in part, at the option of the Investor into shares of Common Stock at a variable conversion price equal to the lowest of (i) 85% of the average VWAP for the shares over the prior 5 trading days, (ii) the closing bid price for the shares on the prior trading day, or (iii) $0.002 per share The Notes may not be converted and shares of Common Stock may not be issued pursuant to the Notes if, after giving effect to the conversion or issuance, the holder together with its affiliates would beneficially own in excess of 9.99% of the outstanding shares of Common Stock. As of December 31, 2017 , the principal and interest balance of the Notes were $4,557,227 and $44,134 , respectively Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Notes were deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The derivative associated with the Notes approximates management’s estimate of the fair value of the embedded derivative liability based on using a Monte Carlo simulation following a Geometric Brownian Motion with the following assumptions identified below. Due to the varying terms and varying issue dates, the tranches of this instrument were broken into three separate instruments for valuation purposes. 1) The first valuation was done on the November 30, 2017 Note with term of three years. Management's analysis, using the following assumptions: annual volatility of 63% present value discount rate of 12% and a dividend yield of 0% , resulted in a fair value of the embedded derivative associated with this Note of $2,756,074 as of November 30, 2017. The value of the embedded derivative associated with the Note was recorded as a debt discount. 2) The second valuation was done on the group of Notes dated November 30, 2017 , that had a term of one year. Management's analysis, using the following assumptions: annual volatility of 67% present value discount rate of 12% and a dividend yield of 0% , resulted in a fair value of the embedded derivative associated with these Notes of $943,735 as of November 30, 2017. The value of the embedded derivative associated with the Note was recorded as a debt discount. 3) The third valuation was done on the Note dated December 28, 2017 , which had a term of one year. Management's analysis, using the following assumptions: annual volatility of 65% present value discount rate of 12% and a dividend yield of 0% , resulted in a fair value of the embedded derivative associated with this Note of $267,008 as of December 28, 2017. Since the value of the derivative was more than the liability, the entire liability of $250,000 was recorded as a debt discount to be amortized with the liability. The remaining balance of $17,008 was charged to interest expense. The derivative liability associated with the Notes is subject to revaluation on a quarterly basis to reflect the market value change of the embedded conversion option. At December 31, 2017 , the Company conducted a fair value assessment of the embedded derivative associated with the three valuation groups discussed above. 1) For the November 30, 2017 3yr Note: Management conducted a fair value assessment with the following assumptions: annual volatility of 63% present value discount rate of 12% and a dividend yield of 0% as of December 31, 2017 . As a result of the fair value assessment, the Company recorded a loss of $985,928 as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Consolidated Statements of Operations to properly reflect the fair value of the embedded derivative of $3,742,002 as of December 31, 2017 . 2) For the November 30, 2017 1yr Notes: Management conducted a fair value assessment with the following assumptions: annual volatility of 60% present value discount rate of 12% and a dividend yield of 0% as of December 31, 2017 . As a result of the fair value assessment, the Company recorded a gain of $55,567 as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Consolidated Statements of Operations to properly reflect the fair value of the embedded derivative of $888,168 as of December 31, 2017 . 3) There were no changes to the December 28, 2017 1yr note, as there was only one trading day for the year following the issuance. During the fourth quarter of 2017, a net loss of $930,361 had been recorded to reflect the total derivative liability of $4,897,178 as of December 31, 2017 . PROMISSORY NOTES Tertius Financial Group Notes and Exchange On August 29, 2016 , the Company entered into a note purchase agreement with Tertius Financial Group Pte. Ltd. ("TFG”) for the private placement of $330,000 of the Company’s original issue discount notes with an original maturity date of November 29, 2016 . The notes bear interest of 6% per annum and principal and interest on the notes are payable upon maturity. The notes are unsecured and not convertible into equity shares of the Company. On December 6, 2016 , the Company issued a new $600,000 original issue discount note to TFG in exchange for (i) $200,000 of additional gross proceeds and (ii) cancellation of the existing outstanding $330,000 note. The new TFG note bears interest at a rate of 6% per annum and matures on December 31, 2017 . Principal and interest on the new TFG note is payable at maturity. Following the transaction, the outstanding balance of the new note was $602,000 (including accrued and unpaid interest) with a discount of $60,000 . On January 19, 2017 , the Company issued 333,333,333 shares of unregistered common stock in a private placement to TFG pursuant to a Securities Purchase Agreement (the “SPA”). Pursuant to the SPA, the Company issued the 333,333,333 shares to TFG in exchange for cancellation of its $600,000 promissory note (including accrued interest of $4,340 ) that was issued by the Company on December 6, 2016 . The SPA does not provide any registration rights for the shares issued to TFG. TFG is a Singapore based entity controlled and 50% owned by Ascent’s President & CEO, Victor Lee, and owns approximately 3% of the Company's outstanding shares at December 31, 2017 . Offering of Unsecured Promissory Notes Between December 2016 and April 2017, the Company initiated eleven non-convertible, unsecured promissory notes with a private investor with varying principal amounts aggregating to $3,400,000 . The promissory notes bear interest of 12% per annum and mature six months from the respective dates of issuance, ranging from June 2, 2017 to October 21, 2017. Unless paid in advance, the principal and interest of these promissory notes are payable upon maturity. The notes are not convertible into equity shares of the Company and are unsecured. Between June and August, 2017, eight of the promissory notes described above matured. The Company and the private investor agreed to pay the interest accrued on these notes, as of the maturity dates, and extend the notes another three months without the Company being in default. Through August 30, 2017, $143,148 interest was paid. On September 13, 2017 , the Company and the investor entered into a Promissory Note Exchange Agreement. Pursuant to the agreement, the Investor exchanged and canceled the eleven outstanding promissory notes (with an aggregate principal and accrued interest of $3,504,199 ) for one new promissory note having a principal amount of approximately $3,504,199 . The new note has a term of three years, bears interest at a rate of 12% per annum, and calls for monthly installment payments of $116,390 commencing on October 13, 2017. The Company has the option to pay monthly installment amounts in the form of shares of common stock. Payments in the form of shares would be calculated using a variable conversion price equal to the lowest of (i) 85% of the average VWAP for the shares over the prior five trading days, (ii) the closing bid price for the shares on the prior trading day, or (iii) $0.004 per share. The Company may not make payments in the form of shares of Common Stock if, after giving effect to the issuance, the holder together with its affiliates would beneficially own in excess of 9.99% of the outstanding shares of Common Stock. On November 30, 2017 , the terms of this note were canceled and the remaining principal and accrued interest balance of $3,359,539 was combined with other instruments into a new Securities Purchase Agreement and secured note with the same investor. Please see Note. 10 for more information. Offering of Unsecured, Non-Convertible Notes During October 2016, the Company received $420,000 from a separate private investor. These funds, along with $250,000 of additional funding, were rolled into a promissory note, executed on January 17, 2017 , in the amount of $700,000 issued with a discount of $30,000 which will be charged to interest expense ratably over the term of the note. The note bears interest at 12% per annum and matures on July 17, 2017 . Principal and interest on this note are payable at maturity. This note is not convertible into equity shares of the Company and is unsecured. On June 30, 2017 , the Company and the private investor agreed to a twelve month payment plan on the balance of this promissory note. Interest will continue to accrue on this note at 12% per annum and payments of approximately $62,000 will be made monthly beginning in July 2017. Four monthly payments were made between July and October of 2017. As of December 31, 2017 , $205,563 of principal and $45,414 of interest had been paid on this note. The outstanding principal and accrued interest balances on the note as of December 31, 2017 were $494,437 and $27,126 , respectively. On April 6, 2017 , the Company initiated a non-convertible, unsecured promissory note with a private investor for $103,000 in exchange for proceeds of $100,000 . The discount of $3,000 will be charged to interest expense ratably over the term of the note. The promissory note bears interest of 10% per annum and matures on October 6, 2017 . On October 6, 2017 , the Company and its investor entered into a Promissory Note Exchange Agreement to convert a promissory note with a principal balance of $103,000 and accrued interest of $5,233 in to common shares. Per the terms of the agreement, the promissory note was canceled and 72,500,000 shares were issued. On May 8, 2017 , the Company initiated a non-convertible, unsecured promissory note with a private investor for $125,000 . The promissory note bears interest of 12% per annum and matures on September 8, 2017 . On September 8, 2017 , the Company redeemed this note, in full, for cash. On October 31, 2017 , the Company initiated a non-convertible, unsecured promissory note with a private investor for $250,000 . The promissory note bears interest of 12% per annum and matures on January 31, 2018 . On November 30, 2017 , the terms of this note were canceled and the remaining principal and accrued interest balance of $252,466 was combined with other instruments into a new Securities Purchase Agreement and secured note with the same investor. Please see Note. 10 for more information. On November 16, 2017 , the Company initiated a non-convertible, unsecured promissory note with a private investor for $275,000 . The promissory note was issued with an original issue discount of $25,000 , resulting in proceeds to the company of $250,000 . The note does not have a stated interest rate and matures on December 18, 2017 . As of December 31, 2017 , no payments had been made on this note and the discount had been recorded as interest expense. During December 2017, the Company received aggregate proceeds of $177,500 , from a private investor. These proceeds were incorporated into a promissory note on January 31, 2018 . Please refer to Note 30 for further information on this note. ST. GEORGE CONVERTIBLE NOTE On September 8, 2017 , the Company entered into a securities purchase agreement with St. George Investments, LLC (“Investor”), for the private placement of $1,725,000 principal amount of the Company’s Original Issue Discount Convertible Promissory Notes. On September 11, 2017 , the Company sold and issued $1,725,000 principal amount of the convertible notes to the Investor in exchange for $1,500,000 of gross proceeds, and paid $20,000 in financing costs. The original issue discount of $225,000 , and the financing fee, will be charged to interest expense, ratably, over the life of the note. Unless earlier converted or prepaid, the convertible notes will mature on March 11, 2019 . The notes do not bear interest in the absence of an event of default. For the first six months after the issuance of the notes, the Company will make a monthly cash repayment on the notes of approximately $96,000 . Thereafter, the Investor may request that the Company make monthly partial redemptions of the note up to $150,000 per month. If the Investor does not request the full $150,000 redemption amount in any one month, the unused portion of such monthly redemption amount can be added to future monthly redemption amounts. But in no event can the amount requested by the Investor for any one month exceed $275,000 . Redemption amounts are payable by the Company in cash. Beginning ten months after the issuance of the convertible notes, cash redemption payments by the Company will be subject to a 15% redemption premium. Beginning six months after the issuance of the convertible notes, the Company also has the option (subject to customary equity conditions) to pay redemption amounts in the form of shares of common stock. Payments in the form of shares would be calculated using a variable conversion price equal to the lower of (i) 85% of the average VWAP for the shares over the prior 5 trading days or (ii) the closing bid price for the shares on the prior trading day. All principal and accrued interest on the Notes are convertible at any time, in whole or in part, at the option of the Investor into shares of Common Stock at a fixed conversion price of $0.004 per share. The Notes contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the Notes; and (ii) bankruptcy or insolvency of the Company. Upon the occurrence of an event of default, the Notes will begin to bear interest at the rate of 22% per annum. In addition, upon the occurrence of an event of default, the Investor has the option to increase the outstanding balance of the Notes by 25% . In connection with the closing under the Note SPA, the Company issued $37,500,000 unregistered shares of common stock to the Investor as an origination fee. The closing stock price on the date of close was $0.0017 resulting in an interest expense of $63,750 being recorded as of the date of close. The Notes may not be converted and shares of Common Stock may not be issued pursuant to the Notes if, after giving effect to the conversion or issuance, the holder together with its affiliates would beneficially own in excess of 4.99% of the outstanding shares of Common Stock. Per the conditions of the SPA, a reserve of 1.88 billion shares was set up out of our authorized and unissued shares. During the fourth quarter of 2017, we made cash payments of $191,667 on this note, and as of December 31, 2017 , the principal balance on this note was $1,705,833 . In lieu of making the December 2017 payment, the share reserve was increased by 3 billion shares. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Notes were deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At closing, a derivative liability and a corresponding debt discount in the amount of $468,095 was recorded. The derivative liability associated with the Notes is subject to revaluation on a quarterly basis to reflect the market value change of the embedded conversion option. At December 31, 2017 , the Company conducted a fair value assessment of the embedded derivative associated with the Notes. As a result of the fair value assessment, the Company recorded a $151,504 loss as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations for the three months ended December 31, 2017 . The net gain recorded for the year ended December 31, 2017 was $73,815 , to properly reflect the fair value of the embedded derivative of $394,280 as of December 31, 2017 . The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The derivative associated with the Notes approximates management’s estimate of the fair value of the embedded derivative liability at December 31, 2017 based on using a Monte Carlo simulation following a Geometric Brownian Motion with the following assumptions: annual volatility of 62% present value discount rate of 12% and dividend yield of 0% . BAYBRIDGE CONVERTIBLE NOTE On December 6, 2017 , the Company entered into a securities exchange agreement (the “Exchange Agreement”) with BayBridge Capital Fund LP (“BayBridge”). Pursuant to the terms of the Exchange Agreement, the Investor agreed to surrender and exchange 675 shares of outstanding Series J Preferred Stock ( $755,417 of capital and accrued dividends). In exchange, the Company issued to the Investor an unsecured promissory note with an aggregate principal amount of $840,000 (the “Exchange Note”), with an original issue discount of $84,583 . Please refer to Note 21 for further discussion on the Series J Preferred Stock. The Exchange Note is unsecured, has no applicable registration rights, bears interest at a rate of 12% per annum, matures on December 6, 2018 , and contains standard and customary events of default including but not limited to: (i) failure to make payments when due under the Exchange Note, and (ii) bankruptcy or insolvency of the Company. Principal and interest are payable upon maturity. Payments of principal and accrued interest on the Exchange Note are payable in cash or, at the option of the Company, in shares of Common Stock at a variable conversion price equal to the lowest of (i) 85% of the average VWAP for the shares over the prior 5 trading days, (ii) the closing bid price for the shares on the prior trading day, or (iii) $0.003 per share. Payments in shares of Common Stock may not be issued pursuant to the Exchange Note if, after giving effect to the conversion or issuance, the holder together with its affiliates would beneficially own in excess of 9.99% of the outstanding shares of Common Stock. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Exchange Note was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. December 6, 2017 , the derivative liability associated with the promissory note was $1,048,311 . Since the value of the derivative was more than the liability and the original issue discount, the entire undiscounted liability of $755,417 was recorded as a debt discount to be amortized over the life of the liability. The remaining $292,894 was charged to interest expense. The derivative liability associated with the Exchange Note is subject to revaluation on a quarterly basis to reflect the market value change of the embedded conversion option. At December 31, 2017 , the Company conducted a fair value assessment of the embedded derivative associated with the Exchange Note. As a result of the fair value assessment, the Company recorded a $505,578 gain as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations, for the year ended December 31, 2017 , to properly reflect the fair value of the embedded derivative of $542,733 as of December 31, 2017 . The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The derivative associated with the Exchange Note approximates management’s estimate of the fair value of the embedded derivative liability at December 31, 2017 based on using a Monte Carlo simulation following a Geometric Brownian Motion with the following assumptions: annual volatility of 61% , present value discount rate of 12% and dividend yield of 0% . As of December 31, 2017 , principal of $275,000 had been converted into 404,411,765 shares of common stock and no cash payments of principal or interest had been made. The principal and accrued interest balances as of December 31, 2017 were $565,000 and $4,825 , respectively. |
Series H Preferred Stock and Ju
Series H Preferred Stock and July 2016 Convertible Notes | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Preferred Stock | SERIES H PREFERRED STOCK AND JULY 2016 CONVERTIBLE NOTES Series H Preferred Stock On June 9, 2016 , the Company entered into a securities purchase agreement with a private investor to issue 2,500 shares of Series H Preferred Stock for $2,500,000 . The Company received gross proceeds of $250,000 at Closing. Additional gross proceeds of $580,000 were received by the Company through July 7, 2016. The Company agreed to exchange outstanding Series H Preferred Stock for Senior Secured Convertible Notes (“July 2016 Notes”) on July 13, 2016 . At the date of the exchange, the Company had sold and issued 830 shares of Series H Preferred Stock to the private investor in exchange for $830,000 of gross proceeds. Please see the section below for details of the exchange. July 2016 Convertible Notes On July 13, 2016 , the Company entered into a securities purchase agreement (the “Note SPA”) with the private investor for the private placement of $2,082,600 of the Company’s 4% Original Issue Discount Senior Secured Convertible Promissory Notes (the “July 2016 Convertible Notes”). On July 13, 2016 , the Company sold and issued $364,000 principal amount of notes to the investor in exchange for $350,000 of gross proceeds. The Company sold and issued the remaining $1,718,600 principal amount of July 2016 Convertible Notes to the investor in exchange for $1,650,000 of gross proceeds in weekly tranches between July and September 2016. The Company and the private investor also entered into an Exchange Agreement dated July 13, 2016 (the “Exchange Agreement”). Under the terms of the Exchange Agreement, the outstanding shares of Series H Preferred Stock (approximately $833,000 of capital and accrued dividends) were canceled. In exchange, the Company issued to the private investor approximately $866,000 of July 2016 Convertible Notes. There were 830 shares of Series H Preferred Stock outstanding as of the date of the Exchange Agreement. Unless earlier converted or prepaid, all of the July 2016 Convertible Notes will mature July 13, 2017 . The July 2016 Convertible Notes bear interest at a rate of 10% per annum, subject to increase to 24% per annum upon the occurrence and continuance of an event of default. Principal on the July 2016 Convertible Notes is payable on the Maturity Date. Interest on the July 2016 Convertible Notes is payable quarterly. Principal and interest are payable in cash or, if specified equity conditions are met, shares of Common Stock. The July 2016 Convertible Notes are secured by a security interest in substantially all of the Company’s assets. The subsidiaries of the Company have guaranteed the Company’s obligations under the July 2016 Convertible Notes. The July 2016 Convertible Notes contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the July 2016 Convertible Notes; (ii) bankruptcy or insolvency of the Company; and (iii) failure to file a registration statement by October 9, 2016. On October 10, 2016 the Company had not been successful in filing the registration statement triggering an event of default per the July 2016 Note Agreement. Upon default the interest rate increases to 24% per annum and the holder of the July 2016 Notes has the option to accelerate the Note and demand cash payment of the Mandatory Default Amount consisting of a 25% premium of the principal balance plus any accrued and unpaid interest. The Company began accruing interest at the rate of 24% on October 10, 2016. Forbearance and Settlement Agreement on July 2016 Convertible Notes On May 5, 2017 , the Company entered into a Forbearance and Settlement Agreement ("Forbearance Agreement") with a holder of certain secured convertible notes that are in default due to various triggering events. The holder and the Company agreed to forbear from taking any action provided for under the secured convertible notes in exchange for the following terms provided in this agreement: • The Company agreed to redeem for cash all secured convertible notes of the Company held by the holder no later than September 1, 2017 . • The Company affirmed that the current balance of owed principal and accrued and unpaid interest to the holder is $1,790,214 as of May 2, 2017 . • The redemption price for such secured convertible notes shall be 120% (if redeemed on or prior to August 15, 2017 ) or 125% (if redeemed after August 15, 2017 ) of the then outstanding principal, plus any accrued and unpaid interest. • During the month of May 2017, the Holder agreed to limit its conversions of outstanding Company secured convertible notes to $50,000 per calendar week of principal/interest. • During the months of June, July and August 2017, the holder agreed to limit its conversions of outstanding Company secured convertible notes to $75,000 per calendar week of principal/interest. • During the months of May, June, July and August 2017, the holder agreed that all outstanding Company secured convertible notes shall bear interest at the normal stated rate of 10% , rather than default rate of 24% . • All conversions during the months of May, June, July and August 2017 will be at the “triggering event” discount conversion price as stated in the secured convertible notes, and will continue at the “triggering event” discount price until, if and when the notes are redeemed. • Should the Company fail to redeem for cash all secured convertible notes on or before September 1, 2017 , default interest and normal stated interest will accrue from the date of execution of this agreement. All principal and accrued interest on the July 2016 Convertible Notes are convertible at any time, in whole or in part, at the option of the private investor, into shares of Common Stock at a variable conversion price equal to the lowest of (i) $0.045 (the “Fixed Conversion Price”), (ii) 70% of the lowest volume weighted average price (“VWAP”) of the Company's common stock for the ten consecutive trading day period prior to the conversion date or (iii) 70% of the lowest closing bid price of the Company's common stock for the ten consecutive trading day period prior to the conversion date. If certain defined triggering events occur, the conversion price would thereafter be reduced (and only reduced), to equal 60% of the lower of (i) the lowest closing bid price of the Company's common stock for the thirty consecutive trading day period prior to the conversion date or (ii) the lowest VWAP of the the Company's common stock for the thirty consecutive trading day period prior to the conversion date. In addition, on the 90th day and also on the 180th day from the date of the Note SPA, the private investor may reset the Fixed Conversion Price to thereafter be equal to the VWAP of the Common Stock for such day or if such 90th or 180th day is not a trading day, then the VWAP for the immediately preceding trading day. The following table summarizes the conversion activity on the principal of the July 2106 Convertible Notes: Conversion Period Principal Converted Common Shares Issued Q4 2016 $ 152,460 64,000,000 Q1 2017 1,017,732 959,704,543 Q2 2017 682,235 1,865,043,998 $ 1,852,427 2,888,748,541 In addition to the $1,852,427 in principal conversions, $3,960 of interest was converted during 2017. As of December 31, 2017 , with $1,096,600 of principal payments, $400,017 of interest payments, and $219,320 of redemption penalty payments, the July 2016 Convertible notes had been redeemed in full. The difference in the accrued interest and the paid interest, due to the terms of the settlement agreement, was $22,661 which was credited to interest expense upon full redemption of the instrument. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the July 2016 Convertible Notes was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At December 31, 2016 the fair value of the derivative liability was $3,733,348 . Throughout 2017, the Company recorded the fair value changes of the embedded derivative associated with the July 2016 Convertible Notes as a gain or loss in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $3,733,348 , to properly reflect the elimination of the embedded derivative upon the extinguishment of the liability. OCTOBER 2016 CONVERTIBLE NOTES AND EXCHANGE OF SERIES A PREFERRED STOCK October 2016 Convertible Notes On October 5, 2016 , the Company entered into a securities purchase agreement with a private investor (“Adar Bays”) for the private placement of $330,000 principal amount of October 2016 Convertible Notes. At Closing, the Company sold and issued $330,000 principal amount of October 2016 Convertible Notes to Adar Bays in exchange for $300,000 of gross proceeds. Unless earlier converted or prepaid, the October 2016 Convertible Notes will mature December 31, 2017 (the “Maturity Date”). The October 2016 Convertible Notes bear interest at a rate of 6% per annum, subject to increase to 24% per annum upon the occurrence and continuance of an event of default (as described below). Principal and accrued interest on the October 2016 Convertible Notes is payable on the Maturity Date. All principal and accrued interest on the October 2016 Convertible Notes are convertible at any time, in whole or in part, at the option of Adar Bays, into shares of common stock at a variable conversion price equal to 80% of the lowest closing bid price of the Company’s common stock for the 15 consecutive trading day period prior to the conversion date. After the six month anniversary of the issuance of any October 2016 Convertible Note, the conversion price for such note shall thereafter be equal to 50% of the lowest closing bid price of the Company’s common stock for the 15 consecutive trading day period prior to the conversion date. The October 2016 Convertible Notes contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the October 2016 Convertible Notes; and (ii) bankruptcy or insolvency of the Company. Outstanding principal and accrued interest on the October 2016 Convertible Notes were $330,000 and $24,860 , respectively as of December 31, 2017 . Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the October 2016 Convertible Notes were deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At closing, a derivative liability and a corresponding debt discount in the amount of $330,000 was recorded. The fair value of the derivative was greater than the face value at issuance and the difference of $341,114 was charged to interest expense at issuance. The remaining debt discount will be charged to interest expense ratably over the life of the October 2016 Convertible Notes. As of December 31, 2016 , the fair value of the derivative liability was $544,746 . The derivative liability associated with the October 2016 Convertible Notes is subject to revaluation on a quarterly basis to reflect the market value change of the embedded conversion option. At December 31, 2017 , the Company conducted a fair value assessment of the embedded derivative associated with the October 2016 Convertible Notes. As a result of the fair value assessment, the Company recorded a $279,442 loss as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations for the three months ended December 31, 2017 . The net loss recorded for the year ended December 31, 2017 was $27,897 , to properly reflect the fair value of the embedded derivative of $572,643 as of December 31, 2017 . The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The derivative associated with the October 2016 Convertible Notes approximates management’s estimate of the fair value of the embedded derivative liability at December 31, 2017 based on using a Monte Carlo simulation following a Geometric Brownian Motion with the following assumptions: annual volatility of 65% present value discount rate of 12% and dividend yield of 0% . Exchange of Outstanding Series A Preferred Stock for Convertible Notes In 2013, the Company completed private placement to one accredited investor (the “Series A Holder”) of its Series A Convertible Preferred Stock. Prior to the exchange agreement described below the Company had $165,541 shares of Series A Preferred Stock that remained outstanding as of October 6, 2016 . On October 6, 2016 , the Series A Holder entered into an exchange agreement (the “Exchange Agreement”) with Adar Bays. Pursuant to the exchange agreement, beginning December 5, 2016, Adar Bays has the option to exchange, from time to time, all or any portion of the October 2016 Convertible Notes for outstanding shares of Series A Preferred Stock from the Series A Holder. As of March 31, 2017, Adar Bays had elected to exchange all outstanding October 2016 Convertible Notes, in accordance with the exchange agreement, and the Series A Holder held $330,000 of the October 2016 Convertible Notes. SERIES A PREFERRED STOCK In June 2013, the Company entered into a Securities Purchase Agreement with an investor to sell an aggregate of 750,000 shares of Series A Preferred Stock at a price of $8 per share, resulting in gross proceeds of $6,000,000 . This purchase agreement included warrants to purchase up to 13,125 shares of common stock of the Company. The transfer of cash and securities took place incrementally, the first closing occurring on June 17, 2013 with the transfer of 125,000 shares of Series A Preferred Stock and a warrant to purchase 2,187 shares of common stock for $1,000,000 . The final closings took place in August 2013, with the transfer of 625,000 shares of Series A Preferred Stock and a warrant to purchase 10,938 shares of common stock for $5,000,000 . Holders of Series A Preferred Stock are entitled to cumulative dividends at a rate of 8% per annum when and if declared by the Board of Directors in its sole discretion. The dividends may be paid in cash or in the form of common stock (valued at 10% below market price, but not to exceed the lowest closing price during the applicable measurement period), at the discretion of the Board of Directors. The dividend rate on the Series A Preferred Stock is indexed to the Company's stock price and subject to adjustment. In addition, the Series A Preferred Stock contains a make-whole provision whereby, conversion or redemption of the preferred stock within 4 years of issuance will require dividends for the full four year period to be paid by the Company in cash or common stock (valued at 10% below market price, but not to exceed the lowest closing price during the applicable measurement period). This make-whole provision expired in June 2017 and future conversions and redemptions will be paid out with accrued dividends per the holding period of the shares of Series A Preferred stock. Please see Note 23 for more information. The Series A Preferred Stock may be converted into shares of common stock at the option of the Company if the closing price of the common stock exceeds $232 , as adjusted, for 20 consecutive trading days, or by the holder at any time. The Company has the right to redeem the Series A Preferred Stock at a price of $8 per share, plus any accrued and unpaid dividends, plus the make-whole amount (if applicable). At December 31, 2017 , the preferred shares were not eligible for conversion to common shares at the option of the Company. The holder of the preferred shares may convert to common shares at any time, at no cost, at a ratio of 1 preferred share into 1 common share (subject to standard ratable anti-dilution adjustments). Upon any conversion (whether at the option of the Company or the holder), the holder is entitled to receive any accrued but unpaid dividends. On October 6, 2016, the Series A Holder entered into an exchange agreement (the “Exchange Agreement”) with Adar Bays. Pursuant to the exchange agreement, beginning December 5, 2016, Adar Bays has the option to exchange, from time to time, all or any portion of the October 2016 Convertible Notes (see Note 13) for outstanding shares of Series A Preferred Stock from the Series A Holder. As of December 31, 2017 , Adar Bays had elected to exchange all outstanding October 2016 Convertible Notes, in accordance with the exchange agreement, resulting in the exchange of 104,785 shares of Series A Preferred Stock. As of December 31, 2017 , Adar Bays had also converted their 104,785 shares of Series A Preferred Stock, and the related make whole dividend, which resulted in the issuance of 173,946,250 shares of common stock. Except as otherwise required by law (or with respect to approval of certain actions), the Series A Preferred Stock shall have no voting rights. Upon any liquidation, dissolution or winding up of the Company, after payment or provision for payment of debts and other liabilities of the Company, the holders of Series A Preferred Stock shall be entitled to receive, pari passu with any distribution to the holders of common stock of the Company, an amount equal to $8 per share of Series A Preferred Stock plus any accrued and unpaid dividends. As of December 31, 2017 , there were 60,756 shares of Series A Preferred Stock outstanding and accrued and unpaid dividends of $279,815 . SERIES E PREFERRED STOCK AND THE COMMITTED EQUITY LINE Series E Preferred Stock On November 4, 2015 , the Company entered into a securities purchase agreement with a private investor to issue 2,800 shares of Series E Preferred Stock in exchange for $2,800,000 . Shares of the Series E Preferred Stock (including the amount of any accrued and unpaid dividends thereon) are convertible, at the option of the holder, into common stock at a variable conversion price equal to 80% of the average of the two lowest VWAPs of the Company's common stock for the ten consecutive trading day period prior to the conversion date. If certain defined default events occur, the conversion price would thereafter be reduced (and only reduced), to equal 70% of the average of the two lowest VWAPs of the Company's common stock for the twenty consecutive trading day period prior to the conversion date. The private investor had available to them a new conversion price beginning on June 9, 2016 as a result of the Series H Preferred Stock transaction further described in Note 12. Shares of the Series E Preferred Stock are now convertible, at the option of the private investor, into common stock at a variable conversion price equal to 70% of (i) the lowest VWAP of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. The following table summarizes the conversion activity of the Series E Preferred Stock: Conversion Period Preferred Series E Shares Converted Value of Series E Preferred Shares (inclusive of accrued dividends) Common Shares Issued Q4 2015 478 $ 481,500 250,000 Q1 2016 1,220 1,239,436 1,132,000 Q2 2016 365 381,414 7,979,568 Q3 2016 523 548,896 21,973,747 Q4 2016 94 101,018 13,089,675 Q1 2017 15 16,248 8,289,962 Q2 2017 35 38,886 134,927,207 Q3 2017 70 76,814 129,314,677 2,800 $ 2,884,212 316,956,836 Holders of the Series E Preferred Stock will be entitled to dividends in the amount of 7% per annum. During the year ended December 31, 2017 , the holder converted dividends in the amount of $11,948 on the Series E Preferred Stock, resulting in the issuance of 25,160,171 shares of common stock. On September 30, 2017, the Company paid $2,013 in cash for the remaining accrued dividends. The Company has issued 18,000 shares of common stock to the private investor as a commitment fee relating to the Series E Preferred Stock. Costs associated with the Series E Preferred Stock, such as legal fees and commitment shares are capitalized and reported as deferred financing costs on the Condensed Consolidated Balance Sheets. The total gross debt issuance cost incurred by the Company related to the Series E Preferred Stock was $104,000 . These debt issuance costs will be recognized as additional interest expense over the life of the Series E Preferred Stock. As of December 31, 2017 , all outstanding shares of Series E Preferred Stock, along with all accrued dividends, had either been converted or redeemed. The Company classified the Series E Preferred Stock as a liability pursuant to ASC 480 on the closing date due to the structure of the financing agreement, whereby the Company has an unconditional obligation that the Company may settle by issuing a variable number of common shares with a monetary value that is fixed and known at inception. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Series E Preferred Stock was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At December 31, 2016 the fair value of the derivative liability was $140,748 . At September 30, 2017, the Company recorded the reduction of the remaining embedded derivative associated with the Series E Preferred Stock of $121,390 as a gain in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $140,748 , to properly reflect the elimination of the embedded derivative as of December 31, 2017 . The Committed Equity Line On November 10, 2015, the Company and the private investor entered into a committed equity line purchase agreement (the "CEL"). Under the terms and subject to the conditions of the CEL purchase agreement, at its option the Company has the right to sell to the private investor, and the private investor is obligated to purchase from the Company, up to $32.2 million of the Company’s common stock, subject to certain limitations, from time to time, over the 36 -month period commencing on December 18, 2015, the date that the registration statement was declared effective by the SEC. From time to time, the Company may direct the private investor, at its sole discretion and subject to certain conditions, to purchase an amount of shares of common stock up to the lesser of (i) $1,000,000 or (ii) 300% of the average daily trading volume of the Company’s common stock over the preceding ten trading day period. The per share purchase price for shares of common stock to be sold by the Company under the CEL purchase agreement shall be equal to 80% of the average of the two lowest VWAPs of the common stock for the ten consecutive trading day period prior to the purchase date. In total, the Company directed the private investor to purchase $3,056,147 of common stock which resulted in the issuance of 1,368,000 shares of common stock. The Company may not direct the private investor to purchase shares of common stock more frequently than once each ten business days. The Company’s sales of shares of common stock to the private investor under the CEL purchase agreement are limited to no more than the number of shares that would result in the beneficial ownership by the private investor and its affiliates, at any single point in time, of more than 9.99% of the Company’s then outstanding shares of common stock. As consideration for entering into the CEL purchase agreement, the Company agreed to issue to the private investor 132,000 shares of common stock (the “Commitment Shares”). The Commitment Shares were issued to the private investor commencing upon the date that the registration statement was declared effective by the SEC. While not officially terminated, the CEL is no longer active and the Company does not consider this a viable source of capital. SERIES F PREFERRED STOCK On January 19, 2016 , the Company entered into a securities purchase agreement with a private investor for the sale of $7,000,000 of the Company’s newly designated Series F Preferred Stock. On January 20, 2016 , the Company sold and issued 7,000 shares of Series F Preferred Stock to the private investor. The aggregate purchase price of the Series F Preferred shares was $7,000,000 . On January 20, 2016 , the private investor paid $500,000 to the Company. The remaining $6,500,000 was paid by the private investor to the Company in 14 weekly increments of $500,000 or $250,000 beginning January 25, 2016 and ending April 28, 2016 . Shares of the Series F Preferred Stock (including the amount of any accrued and unpaid dividends thereon) are convertible, at the option of the holder, into common stock at a fixed conversion price equal to $5 per share. If certain defined default events occur, the conversion price would thereafter be reduced (and only reduced), to equal 70% of the average of the two lowest VWAPs of our common stock for the twenty consecutive trading day period prior to the conversion date. If requested by the private investor, the Company will make weekly redemptions of shares of Series F Preferred Stock (including any accrued and unpaid dividends thereon). If the redemption price is paid by the Company in cash, the number of shares to be redeemed in each weekly increment is 250 shares of Series F Preferred Stock, and the redemption price is a price per share equal to $1,250 plus any accrued but unpaid dividends thereon. The Company has the option to make such redemption payments in shares of common stock provided certain specified equity conditions are satisfied at the time of payment. The number of shares of common stock to be issued would be calculated using a per share price equal to 80% of the one lowest VWAP of our common stock for the ten consecutive trading day period prior to the payment date. For redemption payments made in shares of common stock, the Company will redeem either (i) 250 shares of Series F Preferred Stock or (ii) such greater number of shares of Series F Preferred Stock (and also including any accrued and unpaid dividends) that would result upon redemption in the issuance of a number of shares of common stock equal to 12% of the aggregate composite trading volume for the Company’s common stock during the preceding calendar week. The private investor had available to them a new conversion price beginning on June 9, 2016 as a result of the Series H Preferred Stock transaction further described in Note 12. Shares of the Series F Preferred Stock are now convertible, at the option of the private investor, into common stock at a variable conversion price equal to 70% of (i) the lowest VWAP of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. Amendment of Outstanding Series F Preferred Stock Conversion Price On October 5, 2016 , the Company filed a Certificate of Amendment to the Certificate of Designations of Preferences, Rights and Limitations of Series F Preferred Stock with the Secretary of State of the State of Delaware. The Certificate of Amendment amends the conversion price at which the Series F Preferred Stock can be converted into shares of common stock. The Company had approximately $336,000 of Series F Preferred Stock remaining outstanding as of October 5, 2016 . As amended, the conversion price will now be equal to the lowest of (i) 50% of the lowest weighted average price (“VWAP”) of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) 50% of the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. If certain “Triggering Events” specified in the terms of the Series F Preferred Stock occur, then the conversion price of the Series F Preferred Stock shall be thereafter reduced, and only reduced, to equal 50% of the average of the lowest traded price of the common stock for the twenty consecutive trading day period prior to the conversion date. The following table summarizes the conversion activity of the Series F Preferred Stock: Conversion Period Principal Converted Dividends Converted Common Shares Issued Q1 2016 $ 2,168,402 $ 19,896 2,183,991 Q2 2016 $ 3,234,000 $ 66,931 6,649,741 Q3 2016 $ 1,261,648 $ 54,096 81,917,367 Q4 2016 $ 175,949 $ 9,168 27,276,006 Q3 2017 $ 20,000 $ — 18,181,818 Q4 2017 $ 107,000 $ 467 172,552,354 $ 6,966,999 $ 150,558 308,761,277 Holders of the Series F Preferred Stock are entitled to dividends in the amount of 7% per annum. As of December 31, 2017 , all shares and accrued dividends had been converted and no balance remained. The Company classified the Series F Preferred Stock as a liability pursuant to ASC 480 on the closing date due to the structure of the financing agreement, whereby the Company has an unconditional obligation that the Company may settle by issuing a variable number of common shares with a monetary value that is fixed and known at inception. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Series F Preferred Stock was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At closing, a derivative liability and a corresponding debt discount in the amount of $1,666,000 were recorded. The debt discount will be charged to interest expense ratably over the life of the Series F Preferred Stock. The derivative balance was $255,324 , as of December 31, 2016 . At December 31, 2017 , the Company recorded the reduction of the remaining embedded derivative associated with the Series F Preferred Stock of $42,347 as a gain in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $255,324 , to properly reflect the elimination of the embedded derivative as of December 31, 2017 . SERIES G PREFERRED STOCK On April 29, 2016 , the Company entered into a securities purchase agreement with private investors to issue 2,000 shares of Series G Preferred Stock for $2,000,000 . The Company issued 2,000 shares of Series G Preferred Stock to the private investors, in various tranches between April and June 2016, resulting in gross proceeds to the Company of $2,000,000 . Holders of the Series G Preferred Stock are entitled to dividends in the amount of 10% per annum. One year after issuance, the Company is required to redeem for cash all or any portion of the outstanding shares of the Series G Preferred Stock at a price per share equal to $1,000 plus any accrued but unpaid dividends thereon. Assignment of Series G Preferred Stock Beginning September 19, 2016 , the two private investors (the “Series G Sellers”) entered into assignment agreements with accredited investors (the “Series G Purchasers”). Under the terms of the assignment agreements, the Series G Sellers may sell all 2,000 outstanding shares of Series G Preferred Stock to the Series G Purchasers for a purchase price of $1,000 per share of Series G Preferred Stock (plus the amount of any accrued and unpaid dividends thereon). During 2016 and 2017, the Series G Sellers had sold 1,795 shares of Series G Preferred Stock, representing a value of $1,795,000 , to the Series G Purchasers. On September 21, 2016 , the Company filed a Certificate of Amendment to the Certificate of Designations of Prefe |
October 2016 Convertible Notes
October 2016 Convertible Notes and Exchange of Series A Preferred Stock | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Preferred Stock | SERIES H PREFERRED STOCK AND JULY 2016 CONVERTIBLE NOTES Series H Preferred Stock On June 9, 2016 , the Company entered into a securities purchase agreement with a private investor to issue 2,500 shares of Series H Preferred Stock for $2,500,000 . The Company received gross proceeds of $250,000 at Closing. Additional gross proceeds of $580,000 were received by the Company through July 7, 2016. The Company agreed to exchange outstanding Series H Preferred Stock for Senior Secured Convertible Notes (“July 2016 Notes”) on July 13, 2016 . At the date of the exchange, the Company had sold and issued 830 shares of Series H Preferred Stock to the private investor in exchange for $830,000 of gross proceeds. Please see the section below for details of the exchange. July 2016 Convertible Notes On July 13, 2016 , the Company entered into a securities purchase agreement (the “Note SPA”) with the private investor for the private placement of $2,082,600 of the Company’s 4% Original Issue Discount Senior Secured Convertible Promissory Notes (the “July 2016 Convertible Notes”). On July 13, 2016 , the Company sold and issued $364,000 principal amount of notes to the investor in exchange for $350,000 of gross proceeds. The Company sold and issued the remaining $1,718,600 principal amount of July 2016 Convertible Notes to the investor in exchange for $1,650,000 of gross proceeds in weekly tranches between July and September 2016. The Company and the private investor also entered into an Exchange Agreement dated July 13, 2016 (the “Exchange Agreement”). Under the terms of the Exchange Agreement, the outstanding shares of Series H Preferred Stock (approximately $833,000 of capital and accrued dividends) were canceled. In exchange, the Company issued to the private investor approximately $866,000 of July 2016 Convertible Notes. There were 830 shares of Series H Preferred Stock outstanding as of the date of the Exchange Agreement. Unless earlier converted or prepaid, all of the July 2016 Convertible Notes will mature July 13, 2017 . The July 2016 Convertible Notes bear interest at a rate of 10% per annum, subject to increase to 24% per annum upon the occurrence and continuance of an event of default. Principal on the July 2016 Convertible Notes is payable on the Maturity Date. Interest on the July 2016 Convertible Notes is payable quarterly. Principal and interest are payable in cash or, if specified equity conditions are met, shares of Common Stock. The July 2016 Convertible Notes are secured by a security interest in substantially all of the Company’s assets. The subsidiaries of the Company have guaranteed the Company’s obligations under the July 2016 Convertible Notes. The July 2016 Convertible Notes contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the July 2016 Convertible Notes; (ii) bankruptcy or insolvency of the Company; and (iii) failure to file a registration statement by October 9, 2016. On October 10, 2016 the Company had not been successful in filing the registration statement triggering an event of default per the July 2016 Note Agreement. Upon default the interest rate increases to 24% per annum and the holder of the July 2016 Notes has the option to accelerate the Note and demand cash payment of the Mandatory Default Amount consisting of a 25% premium of the principal balance plus any accrued and unpaid interest. The Company began accruing interest at the rate of 24% on October 10, 2016. Forbearance and Settlement Agreement on July 2016 Convertible Notes On May 5, 2017 , the Company entered into a Forbearance and Settlement Agreement ("Forbearance Agreement") with a holder of certain secured convertible notes that are in default due to various triggering events. The holder and the Company agreed to forbear from taking any action provided for under the secured convertible notes in exchange for the following terms provided in this agreement: • The Company agreed to redeem for cash all secured convertible notes of the Company held by the holder no later than September 1, 2017 . • The Company affirmed that the current balance of owed principal and accrued and unpaid interest to the holder is $1,790,214 as of May 2, 2017 . • The redemption price for such secured convertible notes shall be 120% (if redeemed on or prior to August 15, 2017 ) or 125% (if redeemed after August 15, 2017 ) of the then outstanding principal, plus any accrued and unpaid interest. • During the month of May 2017, the Holder agreed to limit its conversions of outstanding Company secured convertible notes to $50,000 per calendar week of principal/interest. • During the months of June, July and August 2017, the holder agreed to limit its conversions of outstanding Company secured convertible notes to $75,000 per calendar week of principal/interest. • During the months of May, June, July and August 2017, the holder agreed that all outstanding Company secured convertible notes shall bear interest at the normal stated rate of 10% , rather than default rate of 24% . • All conversions during the months of May, June, July and August 2017 will be at the “triggering event” discount conversion price as stated in the secured convertible notes, and will continue at the “triggering event” discount price until, if and when the notes are redeemed. • Should the Company fail to redeem for cash all secured convertible notes on or before September 1, 2017 , default interest and normal stated interest will accrue from the date of execution of this agreement. All principal and accrued interest on the July 2016 Convertible Notes are convertible at any time, in whole or in part, at the option of the private investor, into shares of Common Stock at a variable conversion price equal to the lowest of (i) $0.045 (the “Fixed Conversion Price”), (ii) 70% of the lowest volume weighted average price (“VWAP”) of the Company's common stock for the ten consecutive trading day period prior to the conversion date or (iii) 70% of the lowest closing bid price of the Company's common stock for the ten consecutive trading day period prior to the conversion date. If certain defined triggering events occur, the conversion price would thereafter be reduced (and only reduced), to equal 60% of the lower of (i) the lowest closing bid price of the Company's common stock for the thirty consecutive trading day period prior to the conversion date or (ii) the lowest VWAP of the the Company's common stock for the thirty consecutive trading day period prior to the conversion date. In addition, on the 90th day and also on the 180th day from the date of the Note SPA, the private investor may reset the Fixed Conversion Price to thereafter be equal to the VWAP of the Common Stock for such day or if such 90th or 180th day is not a trading day, then the VWAP for the immediately preceding trading day. The following table summarizes the conversion activity on the principal of the July 2106 Convertible Notes: Conversion Period Principal Converted Common Shares Issued Q4 2016 $ 152,460 64,000,000 Q1 2017 1,017,732 959,704,543 Q2 2017 682,235 1,865,043,998 $ 1,852,427 2,888,748,541 In addition to the $1,852,427 in principal conversions, $3,960 of interest was converted during 2017. As of December 31, 2017 , with $1,096,600 of principal payments, $400,017 of interest payments, and $219,320 of redemption penalty payments, the July 2016 Convertible notes had been redeemed in full. The difference in the accrued interest and the paid interest, due to the terms of the settlement agreement, was $22,661 which was credited to interest expense upon full redemption of the instrument. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the July 2016 Convertible Notes was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At December 31, 2016 the fair value of the derivative liability was $3,733,348 . Throughout 2017, the Company recorded the fair value changes of the embedded derivative associated with the July 2016 Convertible Notes as a gain or loss in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $3,733,348 , to properly reflect the elimination of the embedded derivative upon the extinguishment of the liability. OCTOBER 2016 CONVERTIBLE NOTES AND EXCHANGE OF SERIES A PREFERRED STOCK October 2016 Convertible Notes On October 5, 2016 , the Company entered into a securities purchase agreement with a private investor (“Adar Bays”) for the private placement of $330,000 principal amount of October 2016 Convertible Notes. At Closing, the Company sold and issued $330,000 principal amount of October 2016 Convertible Notes to Adar Bays in exchange for $300,000 of gross proceeds. Unless earlier converted or prepaid, the October 2016 Convertible Notes will mature December 31, 2017 (the “Maturity Date”). The October 2016 Convertible Notes bear interest at a rate of 6% per annum, subject to increase to 24% per annum upon the occurrence and continuance of an event of default (as described below). Principal and accrued interest on the October 2016 Convertible Notes is payable on the Maturity Date. All principal and accrued interest on the October 2016 Convertible Notes are convertible at any time, in whole or in part, at the option of Adar Bays, into shares of common stock at a variable conversion price equal to 80% of the lowest closing bid price of the Company’s common stock for the 15 consecutive trading day period prior to the conversion date. After the six month anniversary of the issuance of any October 2016 Convertible Note, the conversion price for such note shall thereafter be equal to 50% of the lowest closing bid price of the Company’s common stock for the 15 consecutive trading day period prior to the conversion date. The October 2016 Convertible Notes contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the October 2016 Convertible Notes; and (ii) bankruptcy or insolvency of the Company. Outstanding principal and accrued interest on the October 2016 Convertible Notes were $330,000 and $24,860 , respectively as of December 31, 2017 . Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the October 2016 Convertible Notes were deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At closing, a derivative liability and a corresponding debt discount in the amount of $330,000 was recorded. The fair value of the derivative was greater than the face value at issuance and the difference of $341,114 was charged to interest expense at issuance. The remaining debt discount will be charged to interest expense ratably over the life of the October 2016 Convertible Notes. As of December 31, 2016 , the fair value of the derivative liability was $544,746 . The derivative liability associated with the October 2016 Convertible Notes is subject to revaluation on a quarterly basis to reflect the market value change of the embedded conversion option. At December 31, 2017 , the Company conducted a fair value assessment of the embedded derivative associated with the October 2016 Convertible Notes. As a result of the fair value assessment, the Company recorded a $279,442 loss as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations for the three months ended December 31, 2017 . The net loss recorded for the year ended December 31, 2017 was $27,897 , to properly reflect the fair value of the embedded derivative of $572,643 as of December 31, 2017 . The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The derivative associated with the October 2016 Convertible Notes approximates management’s estimate of the fair value of the embedded derivative liability at December 31, 2017 based on using a Monte Carlo simulation following a Geometric Brownian Motion with the following assumptions: annual volatility of 65% present value discount rate of 12% and dividend yield of 0% . Exchange of Outstanding Series A Preferred Stock for Convertible Notes In 2013, the Company completed private placement to one accredited investor (the “Series A Holder”) of its Series A Convertible Preferred Stock. Prior to the exchange agreement described below the Company had $165,541 shares of Series A Preferred Stock that remained outstanding as of October 6, 2016 . On October 6, 2016 , the Series A Holder entered into an exchange agreement (the “Exchange Agreement”) with Adar Bays. Pursuant to the exchange agreement, beginning December 5, 2016, Adar Bays has the option to exchange, from time to time, all or any portion of the October 2016 Convertible Notes for outstanding shares of Series A Preferred Stock from the Series A Holder. As of March 31, 2017, Adar Bays had elected to exchange all outstanding October 2016 Convertible Notes, in accordance with the exchange agreement, and the Series A Holder held $330,000 of the October 2016 Convertible Notes. SERIES A PREFERRED STOCK In June 2013, the Company entered into a Securities Purchase Agreement with an investor to sell an aggregate of 750,000 shares of Series A Preferred Stock at a price of $8 per share, resulting in gross proceeds of $6,000,000 . This purchase agreement included warrants to purchase up to 13,125 shares of common stock of the Company. The transfer of cash and securities took place incrementally, the first closing occurring on June 17, 2013 with the transfer of 125,000 shares of Series A Preferred Stock and a warrant to purchase 2,187 shares of common stock for $1,000,000 . The final closings took place in August 2013, with the transfer of 625,000 shares of Series A Preferred Stock and a warrant to purchase 10,938 shares of common stock for $5,000,000 . Holders of Series A Preferred Stock are entitled to cumulative dividends at a rate of 8% per annum when and if declared by the Board of Directors in its sole discretion. The dividends may be paid in cash or in the form of common stock (valued at 10% below market price, but not to exceed the lowest closing price during the applicable measurement period), at the discretion of the Board of Directors. The dividend rate on the Series A Preferred Stock is indexed to the Company's stock price and subject to adjustment. In addition, the Series A Preferred Stock contains a make-whole provision whereby, conversion or redemption of the preferred stock within 4 years of issuance will require dividends for the full four year period to be paid by the Company in cash or common stock (valued at 10% below market price, but not to exceed the lowest closing price during the applicable measurement period). This make-whole provision expired in June 2017 and future conversions and redemptions will be paid out with accrued dividends per the holding period of the shares of Series A Preferred stock. Please see Note 23 for more information. The Series A Preferred Stock may be converted into shares of common stock at the option of the Company if the closing price of the common stock exceeds $232 , as adjusted, for 20 consecutive trading days, or by the holder at any time. The Company has the right to redeem the Series A Preferred Stock at a price of $8 per share, plus any accrued and unpaid dividends, plus the make-whole amount (if applicable). At December 31, 2017 , the preferred shares were not eligible for conversion to common shares at the option of the Company. The holder of the preferred shares may convert to common shares at any time, at no cost, at a ratio of 1 preferred share into 1 common share (subject to standard ratable anti-dilution adjustments). Upon any conversion (whether at the option of the Company or the holder), the holder is entitled to receive any accrued but unpaid dividends. On October 6, 2016, the Series A Holder entered into an exchange agreement (the “Exchange Agreement”) with Adar Bays. Pursuant to the exchange agreement, beginning December 5, 2016, Adar Bays has the option to exchange, from time to time, all or any portion of the October 2016 Convertible Notes (see Note 13) for outstanding shares of Series A Preferred Stock from the Series A Holder. As of December 31, 2017 , Adar Bays had elected to exchange all outstanding October 2016 Convertible Notes, in accordance with the exchange agreement, resulting in the exchange of 104,785 shares of Series A Preferred Stock. As of December 31, 2017 , Adar Bays had also converted their 104,785 shares of Series A Preferred Stock, and the related make whole dividend, which resulted in the issuance of 173,946,250 shares of common stock. Except as otherwise required by law (or with respect to approval of certain actions), the Series A Preferred Stock shall have no voting rights. Upon any liquidation, dissolution or winding up of the Company, after payment or provision for payment of debts and other liabilities of the Company, the holders of Series A Preferred Stock shall be entitled to receive, pari passu with any distribution to the holders of common stock of the Company, an amount equal to $8 per share of Series A Preferred Stock plus any accrued and unpaid dividends. As of December 31, 2017 , there were 60,756 shares of Series A Preferred Stock outstanding and accrued and unpaid dividends of $279,815 . SERIES E PREFERRED STOCK AND THE COMMITTED EQUITY LINE Series E Preferred Stock On November 4, 2015 , the Company entered into a securities purchase agreement with a private investor to issue 2,800 shares of Series E Preferred Stock in exchange for $2,800,000 . Shares of the Series E Preferred Stock (including the amount of any accrued and unpaid dividends thereon) are convertible, at the option of the holder, into common stock at a variable conversion price equal to 80% of the average of the two lowest VWAPs of the Company's common stock for the ten consecutive trading day period prior to the conversion date. If certain defined default events occur, the conversion price would thereafter be reduced (and only reduced), to equal 70% of the average of the two lowest VWAPs of the Company's common stock for the twenty consecutive trading day period prior to the conversion date. The private investor had available to them a new conversion price beginning on June 9, 2016 as a result of the Series H Preferred Stock transaction further described in Note 12. Shares of the Series E Preferred Stock are now convertible, at the option of the private investor, into common stock at a variable conversion price equal to 70% of (i) the lowest VWAP of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. The following table summarizes the conversion activity of the Series E Preferred Stock: Conversion Period Preferred Series E Shares Converted Value of Series E Preferred Shares (inclusive of accrued dividends) Common Shares Issued Q4 2015 478 $ 481,500 250,000 Q1 2016 1,220 1,239,436 1,132,000 Q2 2016 365 381,414 7,979,568 Q3 2016 523 548,896 21,973,747 Q4 2016 94 101,018 13,089,675 Q1 2017 15 16,248 8,289,962 Q2 2017 35 38,886 134,927,207 Q3 2017 70 76,814 129,314,677 2,800 $ 2,884,212 316,956,836 Holders of the Series E Preferred Stock will be entitled to dividends in the amount of 7% per annum. During the year ended December 31, 2017 , the holder converted dividends in the amount of $11,948 on the Series E Preferred Stock, resulting in the issuance of 25,160,171 shares of common stock. On September 30, 2017, the Company paid $2,013 in cash for the remaining accrued dividends. The Company has issued 18,000 shares of common stock to the private investor as a commitment fee relating to the Series E Preferred Stock. Costs associated with the Series E Preferred Stock, such as legal fees and commitment shares are capitalized and reported as deferred financing costs on the Condensed Consolidated Balance Sheets. The total gross debt issuance cost incurred by the Company related to the Series E Preferred Stock was $104,000 . These debt issuance costs will be recognized as additional interest expense over the life of the Series E Preferred Stock. As of December 31, 2017 , all outstanding shares of Series E Preferred Stock, along with all accrued dividends, had either been converted or redeemed. The Company classified the Series E Preferred Stock as a liability pursuant to ASC 480 on the closing date due to the structure of the financing agreement, whereby the Company has an unconditional obligation that the Company may settle by issuing a variable number of common shares with a monetary value that is fixed and known at inception. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Series E Preferred Stock was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At December 31, 2016 the fair value of the derivative liability was $140,748 . At September 30, 2017, the Company recorded the reduction of the remaining embedded derivative associated with the Series E Preferred Stock of $121,390 as a gain in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $140,748 , to properly reflect the elimination of the embedded derivative as of December 31, 2017 . The Committed Equity Line On November 10, 2015, the Company and the private investor entered into a committed equity line purchase agreement (the "CEL"). Under the terms and subject to the conditions of the CEL purchase agreement, at its option the Company has the right to sell to the private investor, and the private investor is obligated to purchase from the Company, up to $32.2 million of the Company’s common stock, subject to certain limitations, from time to time, over the 36 -month period commencing on December 18, 2015, the date that the registration statement was declared effective by the SEC. From time to time, the Company may direct the private investor, at its sole discretion and subject to certain conditions, to purchase an amount of shares of common stock up to the lesser of (i) $1,000,000 or (ii) 300% of the average daily trading volume of the Company’s common stock over the preceding ten trading day period. The per share purchase price for shares of common stock to be sold by the Company under the CEL purchase agreement shall be equal to 80% of the average of the two lowest VWAPs of the common stock for the ten consecutive trading day period prior to the purchase date. In total, the Company directed the private investor to purchase $3,056,147 of common stock which resulted in the issuance of 1,368,000 shares of common stock. The Company may not direct the private investor to purchase shares of common stock more frequently than once each ten business days. The Company’s sales of shares of common stock to the private investor under the CEL purchase agreement are limited to no more than the number of shares that would result in the beneficial ownership by the private investor and its affiliates, at any single point in time, of more than 9.99% of the Company’s then outstanding shares of common stock. As consideration for entering into the CEL purchase agreement, the Company agreed to issue to the private investor 132,000 shares of common stock (the “Commitment Shares”). The Commitment Shares were issued to the private investor commencing upon the date that the registration statement was declared effective by the SEC. While not officially terminated, the CEL is no longer active and the Company does not consider this a viable source of capital. SERIES F PREFERRED STOCK On January 19, 2016 , the Company entered into a securities purchase agreement with a private investor for the sale of $7,000,000 of the Company’s newly designated Series F Preferred Stock. On January 20, 2016 , the Company sold and issued 7,000 shares of Series F Preferred Stock to the private investor. The aggregate purchase price of the Series F Preferred shares was $7,000,000 . On January 20, 2016 , the private investor paid $500,000 to the Company. The remaining $6,500,000 was paid by the private investor to the Company in 14 weekly increments of $500,000 or $250,000 beginning January 25, 2016 and ending April 28, 2016 . Shares of the Series F Preferred Stock (including the amount of any accrued and unpaid dividends thereon) are convertible, at the option of the holder, into common stock at a fixed conversion price equal to $5 per share. If certain defined default events occur, the conversion price would thereafter be reduced (and only reduced), to equal 70% of the average of the two lowest VWAPs of our common stock for the twenty consecutive trading day period prior to the conversion date. If requested by the private investor, the Company will make weekly redemptions of shares of Series F Preferred Stock (including any accrued and unpaid dividends thereon). If the redemption price is paid by the Company in cash, the number of shares to be redeemed in each weekly increment is 250 shares of Series F Preferred Stock, and the redemption price is a price per share equal to $1,250 plus any accrued but unpaid dividends thereon. The Company has the option to make such redemption payments in shares of common stock provided certain specified equity conditions are satisfied at the time of payment. The number of shares of common stock to be issued would be calculated using a per share price equal to 80% of the one lowest VWAP of our common stock for the ten consecutive trading day period prior to the payment date. For redemption payments made in shares of common stock, the Company will redeem either (i) 250 shares of Series F Preferred Stock or (ii) such greater number of shares of Series F Preferred Stock (and also including any accrued and unpaid dividends) that would result upon redemption in the issuance of a number of shares of common stock equal to 12% of the aggregate composite trading volume for the Company’s common stock during the preceding calendar week. The private investor had available to them a new conversion price beginning on June 9, 2016 as a result of the Series H Preferred Stock transaction further described in Note 12. Shares of the Series F Preferred Stock are now convertible, at the option of the private investor, into common stock at a variable conversion price equal to 70% of (i) the lowest VWAP of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. Amendment of Outstanding Series F Preferred Stock Conversion Price On October 5, 2016 , the Company filed a Certificate of Amendment to the Certificate of Designations of Preferences, Rights and Limitations of Series F Preferred Stock with the Secretary of State of the State of Delaware. The Certificate of Amendment amends the conversion price at which the Series F Preferred Stock can be converted into shares of common stock. The Company had approximately $336,000 of Series F Preferred Stock remaining outstanding as of October 5, 2016 . As amended, the conversion price will now be equal to the lowest of (i) 50% of the lowest weighted average price (“VWAP”) of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) 50% of the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. If certain “Triggering Events” specified in the terms of the Series F Preferred Stock occur, then the conversion price of the Series F Preferred Stock shall be thereafter reduced, and only reduced, to equal 50% of the average of the lowest traded price of the common stock for the twenty consecutive trading day period prior to the conversion date. The following table summarizes the conversion activity of the Series F Preferred Stock: Conversion Period Principal Converted Dividends Converted Common Shares Issued Q1 2016 $ 2,168,402 $ 19,896 2,183,991 Q2 2016 $ 3,234,000 $ 66,931 6,649,741 Q3 2016 $ 1,261,648 $ 54,096 81,917,367 Q4 2016 $ 175,949 $ 9,168 27,276,006 Q3 2017 $ 20,000 $ — 18,181,818 Q4 2017 $ 107,000 $ 467 172,552,354 $ 6,966,999 $ 150,558 308,761,277 Holders of the Series F Preferred Stock are entitled to dividends in the amount of 7% per annum. As of December 31, 2017 , all shares and accrued dividends had been converted and no balance remained. The Company classified the Series F Preferred Stock as a liability pursuant to ASC 480 on the closing date due to the structure of the financing agreement, whereby the Company has an unconditional obligation that the Company may settle by issuing a variable number of common shares with a monetary value that is fixed and known at inception. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Series F Preferred Stock was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At closing, a derivative liability and a corresponding debt discount in the amount of $1,666,000 were recorded. The debt discount will be charged to interest expense ratably over the life of the Series F Preferred Stock. The derivative balance was $255,324 , as of December 31, 2016 . At December 31, 2017 , the Company recorded the reduction of the remaining embedded derivative associated with the Series F Preferred Stock of $42,347 as a gain in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $255,324 , to properly reflect the elimination of the embedded derivative as of December 31, 2017 . SERIES G PREFERRED STOCK On April 29, 2016 , the Company entered into a securities purchase agreement with private investors to issue 2,000 shares of Series G Preferred Stock for $2,000,000 . The Company issued 2,000 shares of Series G Preferred Stock to the private investors, in various tranches between April and June 2016, resulting in gross proceeds to the Company of $2,000,000 . Holders of the Series G Preferred Stock are entitled to dividends in the amount of 10% per annum. One year after issuance, the Company is required to redeem for cash all or any portion of the outstanding shares of the Series G Preferred Stock at a price per share equal to $1,000 plus any accrued but unpaid dividends thereon. Assignment of Series G Preferred Stock Beginning September 19, 2016 , the two private investors (the “Series G Sellers”) entered into assignment agreements with accredited investors (the “Series G Purchasers”). Under the terms of the assignment agreements, the Series G Sellers may sell all 2,000 outstanding shares of Series G Preferred Stock to the Series G Purchasers for a purchase price of $1,000 per share of Series G Preferred Stock (plus the amount of any accrued and unpaid dividends thereon). During 2016 and 2017, the Series G Sellers had sold 1,795 shares of Series G Preferred Stock, representing a value of $1,795,000 , to the Series G Purchasers. On September 21, 2016 , the Company filed a Certificate of Amendment to the Certificate of Designations of Prefe |
St. George Convertible Note
St. George Convertible Note | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Convertible Note | NOTES PAYABLE On February 24, 2017 , the Company entered into an agreement with a vendor to convert the balance of their account into three notes payable in the aggregate amount of $765,784 . The notes bear interest of 6% per annum and matures on February 24, 2018 ; all outstanding principal and accrued interest is due and payable upon maturity. As of December 31, 2017 , the Company had not made any payments on these notes and the accrued interest was $39,565 . As of the date of this filing, this note has matured and is due and payable on demand. On February 27, 2017 , the Company entered into an agreement with a vendor to convert the balance of their account into a note payable in the amount of $49,500 . The note bears interest of 6% per annum and matures on September 27, 2017 ; all outstanding principal and accrued interest is due and payable upon maturity. On September 27, 2017 , the Company paid the note, plus $1,725 in accrued interest, in full. On March 23, 2017 , the Company entered into an agreement with a vendor to convert the balance of their account into a note payable in the amount of $356,742 . The note bears interest of 5% per annum and matures on October 23, 2017 ; all outstanding principal and accrued interest is due and payable upon maturity. On October 23, 2017 , the Company amended its promissory note with this vendor. The amendment extended the note's maturity to November 6, 2017 . Again on December 12, 2017 , the Company amended its promissory note with this vendor. The amendment extended the note's maturity to March 31, 2018 . As of December 31, 2017 , the Company had not made any payments on the note and the accrued interest was $13,830 . On June 30, 2017 , the Company entered into an agreement with a vendor to convert the balance of their account into a note payable in the amount of $250,000 . The note bears interest of 5% per annum and matures on February 28, 2018 ; all outstanding principal and accrued interest is due and payable upon maturity. As of December 31, 2017 , the Company had not made any payments on these notes and the accrued interest was $6,301 . As of the date of this filing, this note has matured and is due and payable on demand. On September 30, 2017 , the Company entered into a settlement agreement with a customer to convert the credit balance of their account into a note payable in the amount of $215,234 . The note bears interest of 5% per annum and matures on September 30, 2018 . Per the settlement agreement, monthly payments of $18,426 were to commence on October 30, 2017 . As of December 31, 2017 , one of the monthly payments had been made and the remaining principal and interest balances were $197,705 and $2,540 , respectively. SECURED PROMISSORY NOTE On November 30, 2017 , the Company, entered into a note purchase and exchange agreement (the “Note SPA”) with Global Ichiban Ltd (“Investor”), for the private placement of up to $2,000,000 of the Company’s Secured Convertible Promissory Notes (“Notes”) in exchange for $2,000,000 of gross proceeds in several tranches through June 2018, The closing of each tranche is conditioned upon the Company having an average daily trading volume for its Common Stock of at least $50,000 for the 20 trading day period preceding such future tranche closing dates. Pursuant to the terms of the Note SPA, the Company and the Investor also agreed to exchange certain outstanding securities held by the Investor for additional Notes. As of November 30, 2017 , the Investor surrendered for cancellation (i) its outstanding promissory note dated September 13, 2017 ( $3,359,539 principal and accrued interest), (ii) its outstanding promissory note dated October 31, 2017 ( $252,466 principal and accrued interest), and (iii) its 400 shares of outstanding Series J Preferred Stock ( $445,222 of capital and accrued dividends). In exchange, the Company issued to the Investor $4,057,227 aggregate principal amount of additional Notes. Please refer to Note 11 for further discussion on the canceled promissory notes and Note 21 on the canceled Series J Preferred Stock shares. Of the Notes issued on November 30, 2017 , $3,359,539 aggregate principal amount will mature on December 15, 2020 . Principal and interest will be payable in 36 equal monthly installments beginning January 15, 2018 . Of the Notes issued on November 30, 2017 , $697,688 aggregate principal amount will mature on November 30, 2018 . Principal and interest will be payable upon maturity. The $2,000,000 aggregate principal amount of Notes to be issued in the future in tranches pursuant to the Note SPA will mature on the first anniversary of the respective issuance date. Principal and interest will be payable upon maturity. As of December 31, 2017 , the closing dates, closing amounts, and maturity dates on completed Note SPA tranches are as follows: Closing Date Closing Amount Maturity Date 11/30/2017 $ 250,000 11/30/2018 12/28/2017 $ 250,000 12/28/2018 The Notes will be secured by a security interest on substantially all of the Company’s assets, bear interest at a rate of 12% per annum and contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the Notes, and (ii) bankruptcy or insolvency of the Company. There are no registration rights applicable to the Notes. All principal and accrued interest on the Notes are convertible at any time, in whole or in part, at the option of the Investor into shares of Common Stock at a variable conversion price equal to the lowest of (i) 85% of the average VWAP for the shares over the prior 5 trading days, (ii) the closing bid price for the shares on the prior trading day, or (iii) $0.002 per share The Notes may not be converted and shares of Common Stock may not be issued pursuant to the Notes if, after giving effect to the conversion or issuance, the holder together with its affiliates would beneficially own in excess of 9.99% of the outstanding shares of Common Stock. As of December 31, 2017 , the principal and interest balance of the Notes were $4,557,227 and $44,134 , respectively Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Notes were deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The derivative associated with the Notes approximates management’s estimate of the fair value of the embedded derivative liability based on using a Monte Carlo simulation following a Geometric Brownian Motion with the following assumptions identified below. Due to the varying terms and varying issue dates, the tranches of this instrument were broken into three separate instruments for valuation purposes. 1) The first valuation was done on the November 30, 2017 Note with term of three years. Management's analysis, using the following assumptions: annual volatility of 63% present value discount rate of 12% and a dividend yield of 0% , resulted in a fair value of the embedded derivative associated with this Note of $2,756,074 as of November 30, 2017. The value of the embedded derivative associated with the Note was recorded as a debt discount. 2) The second valuation was done on the group of Notes dated November 30, 2017 , that had a term of one year. Management's analysis, using the following assumptions: annual volatility of 67% present value discount rate of 12% and a dividend yield of 0% , resulted in a fair value of the embedded derivative associated with these Notes of $943,735 as of November 30, 2017. The value of the embedded derivative associated with the Note was recorded as a debt discount. 3) The third valuation was done on the Note dated December 28, 2017 , which had a term of one year. Management's analysis, using the following assumptions: annual volatility of 65% present value discount rate of 12% and a dividend yield of 0% , resulted in a fair value of the embedded derivative associated with this Note of $267,008 as of December 28, 2017. Since the value of the derivative was more than the liability, the entire liability of $250,000 was recorded as a debt discount to be amortized with the liability. The remaining balance of $17,008 was charged to interest expense. The derivative liability associated with the Notes is subject to revaluation on a quarterly basis to reflect the market value change of the embedded conversion option. At December 31, 2017 , the Company conducted a fair value assessment of the embedded derivative associated with the three valuation groups discussed above. 1) For the November 30, 2017 3yr Note: Management conducted a fair value assessment with the following assumptions: annual volatility of 63% present value discount rate of 12% and a dividend yield of 0% as of December 31, 2017 . As a result of the fair value assessment, the Company recorded a loss of $985,928 as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Consolidated Statements of Operations to properly reflect the fair value of the embedded derivative of $3,742,002 as of December 31, 2017 . 2) For the November 30, 2017 1yr Notes: Management conducted a fair value assessment with the following assumptions: annual volatility of 60% present value discount rate of 12% and a dividend yield of 0% as of December 31, 2017 . As a result of the fair value assessment, the Company recorded a gain of $55,567 as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Consolidated Statements of Operations to properly reflect the fair value of the embedded derivative of $888,168 as of December 31, 2017 . 3) There were no changes to the December 28, 2017 1yr note, as there was only one trading day for the year following the issuance. During the fourth quarter of 2017, a net loss of $930,361 had been recorded to reflect the total derivative liability of $4,897,178 as of December 31, 2017 . PROMISSORY NOTES Tertius Financial Group Notes and Exchange On August 29, 2016 , the Company entered into a note purchase agreement with Tertius Financial Group Pte. Ltd. ("TFG”) for the private placement of $330,000 of the Company’s original issue discount notes with an original maturity date of November 29, 2016 . The notes bear interest of 6% per annum and principal and interest on the notes are payable upon maturity. The notes are unsecured and not convertible into equity shares of the Company. On December 6, 2016 , the Company issued a new $600,000 original issue discount note to TFG in exchange for (i) $200,000 of additional gross proceeds and (ii) cancellation of the existing outstanding $330,000 note. The new TFG note bears interest at a rate of 6% per annum and matures on December 31, 2017 . Principal and interest on the new TFG note is payable at maturity. Following the transaction, the outstanding balance of the new note was $602,000 (including accrued and unpaid interest) with a discount of $60,000 . On January 19, 2017 , the Company issued 333,333,333 shares of unregistered common stock in a private placement to TFG pursuant to a Securities Purchase Agreement (the “SPA”). Pursuant to the SPA, the Company issued the 333,333,333 shares to TFG in exchange for cancellation of its $600,000 promissory note (including accrued interest of $4,340 ) that was issued by the Company on December 6, 2016 . The SPA does not provide any registration rights for the shares issued to TFG. TFG is a Singapore based entity controlled and 50% owned by Ascent’s President & CEO, Victor Lee, and owns approximately 3% of the Company's outstanding shares at December 31, 2017 . Offering of Unsecured Promissory Notes Between December 2016 and April 2017, the Company initiated eleven non-convertible, unsecured promissory notes with a private investor with varying principal amounts aggregating to $3,400,000 . The promissory notes bear interest of 12% per annum and mature six months from the respective dates of issuance, ranging from June 2, 2017 to October 21, 2017. Unless paid in advance, the principal and interest of these promissory notes are payable upon maturity. The notes are not convertible into equity shares of the Company and are unsecured. Between June and August, 2017, eight of the promissory notes described above matured. The Company and the private investor agreed to pay the interest accrued on these notes, as of the maturity dates, and extend the notes another three months without the Company being in default. Through August 30, 2017, $143,148 interest was paid. On September 13, 2017 , the Company and the investor entered into a Promissory Note Exchange Agreement. Pursuant to the agreement, the Investor exchanged and canceled the eleven outstanding promissory notes (with an aggregate principal and accrued interest of $3,504,199 ) for one new promissory note having a principal amount of approximately $3,504,199 . The new note has a term of three years, bears interest at a rate of 12% per annum, and calls for monthly installment payments of $116,390 commencing on October 13, 2017. The Company has the option to pay monthly installment amounts in the form of shares of common stock. Payments in the form of shares would be calculated using a variable conversion price equal to the lowest of (i) 85% of the average VWAP for the shares over the prior five trading days, (ii) the closing bid price for the shares on the prior trading day, or (iii) $0.004 per share. The Company may not make payments in the form of shares of Common Stock if, after giving effect to the issuance, the holder together with its affiliates would beneficially own in excess of 9.99% of the outstanding shares of Common Stock. On November 30, 2017 , the terms of this note were canceled and the remaining principal and accrued interest balance of $3,359,539 was combined with other instruments into a new Securities Purchase Agreement and secured note with the same investor. Please see Note. 10 for more information. Offering of Unsecured, Non-Convertible Notes During October 2016, the Company received $420,000 from a separate private investor. These funds, along with $250,000 of additional funding, were rolled into a promissory note, executed on January 17, 2017 , in the amount of $700,000 issued with a discount of $30,000 which will be charged to interest expense ratably over the term of the note. The note bears interest at 12% per annum and matures on July 17, 2017 . Principal and interest on this note are payable at maturity. This note is not convertible into equity shares of the Company and is unsecured. On June 30, 2017 , the Company and the private investor agreed to a twelve month payment plan on the balance of this promissory note. Interest will continue to accrue on this note at 12% per annum and payments of approximately $62,000 will be made monthly beginning in July 2017. Four monthly payments were made between July and October of 2017. As of December 31, 2017 , $205,563 of principal and $45,414 of interest had been paid on this note. The outstanding principal and accrued interest balances on the note as of December 31, 2017 were $494,437 and $27,126 , respectively. On April 6, 2017 , the Company initiated a non-convertible, unsecured promissory note with a private investor for $103,000 in exchange for proceeds of $100,000 . The discount of $3,000 will be charged to interest expense ratably over the term of the note. The promissory note bears interest of 10% per annum and matures on October 6, 2017 . On October 6, 2017 , the Company and its investor entered into a Promissory Note Exchange Agreement to convert a promissory note with a principal balance of $103,000 and accrued interest of $5,233 in to common shares. Per the terms of the agreement, the promissory note was canceled and 72,500,000 shares were issued. On May 8, 2017 , the Company initiated a non-convertible, unsecured promissory note with a private investor for $125,000 . The promissory note bears interest of 12% per annum and matures on September 8, 2017 . On September 8, 2017 , the Company redeemed this note, in full, for cash. On October 31, 2017 , the Company initiated a non-convertible, unsecured promissory note with a private investor for $250,000 . The promissory note bears interest of 12% per annum and matures on January 31, 2018 . On November 30, 2017 , the terms of this note were canceled and the remaining principal and accrued interest balance of $252,466 was combined with other instruments into a new Securities Purchase Agreement and secured note with the same investor. Please see Note. 10 for more information. On November 16, 2017 , the Company initiated a non-convertible, unsecured promissory note with a private investor for $275,000 . The promissory note was issued with an original issue discount of $25,000 , resulting in proceeds to the company of $250,000 . The note does not have a stated interest rate and matures on December 18, 2017 . As of December 31, 2017 , no payments had been made on this note and the discount had been recorded as interest expense. During December 2017, the Company received aggregate proceeds of $177,500 , from a private investor. These proceeds were incorporated into a promissory note on January 31, 2018 . Please refer to Note 30 for further information on this note. ST. GEORGE CONVERTIBLE NOTE On September 8, 2017 , the Company entered into a securities purchase agreement with St. George Investments, LLC (“Investor”), for the private placement of $1,725,000 principal amount of the Company’s Original Issue Discount Convertible Promissory Notes. On September 11, 2017 , the Company sold and issued $1,725,000 principal amount of the convertible notes to the Investor in exchange for $1,500,000 of gross proceeds, and paid $20,000 in financing costs. The original issue discount of $225,000 , and the financing fee, will be charged to interest expense, ratably, over the life of the note. Unless earlier converted or prepaid, the convertible notes will mature on March 11, 2019 . The notes do not bear interest in the absence of an event of default. For the first six months after the issuance of the notes, the Company will make a monthly cash repayment on the notes of approximately $96,000 . Thereafter, the Investor may request that the Company make monthly partial redemptions of the note up to $150,000 per month. If the Investor does not request the full $150,000 redemption amount in any one month, the unused portion of such monthly redemption amount can be added to future monthly redemption amounts. But in no event can the amount requested by the Investor for any one month exceed $275,000 . Redemption amounts are payable by the Company in cash. Beginning ten months after the issuance of the convertible notes, cash redemption payments by the Company will be subject to a 15% redemption premium. Beginning six months after the issuance of the convertible notes, the Company also has the option (subject to customary equity conditions) to pay redemption amounts in the form of shares of common stock. Payments in the form of shares would be calculated using a variable conversion price equal to the lower of (i) 85% of the average VWAP for the shares over the prior 5 trading days or (ii) the closing bid price for the shares on the prior trading day. All principal and accrued interest on the Notes are convertible at any time, in whole or in part, at the option of the Investor into shares of Common Stock at a fixed conversion price of $0.004 per share. The Notes contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the Notes; and (ii) bankruptcy or insolvency of the Company. Upon the occurrence of an event of default, the Notes will begin to bear interest at the rate of 22% per annum. In addition, upon the occurrence of an event of default, the Investor has the option to increase the outstanding balance of the Notes by 25% . In connection with the closing under the Note SPA, the Company issued $37,500,000 unregistered shares of common stock to the Investor as an origination fee. The closing stock price on the date of close was $0.0017 resulting in an interest expense of $63,750 being recorded as of the date of close. The Notes may not be converted and shares of Common Stock may not be issued pursuant to the Notes if, after giving effect to the conversion or issuance, the holder together with its affiliates would beneficially own in excess of 4.99% of the outstanding shares of Common Stock. Per the conditions of the SPA, a reserve of 1.88 billion shares was set up out of our authorized and unissued shares. During the fourth quarter of 2017, we made cash payments of $191,667 on this note, and as of December 31, 2017 , the principal balance on this note was $1,705,833 . In lieu of making the December 2017 payment, the share reserve was increased by 3 billion shares. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Notes were deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At closing, a derivative liability and a corresponding debt discount in the amount of $468,095 was recorded. The derivative liability associated with the Notes is subject to revaluation on a quarterly basis to reflect the market value change of the embedded conversion option. At December 31, 2017 , the Company conducted a fair value assessment of the embedded derivative associated with the Notes. As a result of the fair value assessment, the Company recorded a $151,504 loss as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations for the three months ended December 31, 2017 . The net gain recorded for the year ended December 31, 2017 was $73,815 , to properly reflect the fair value of the embedded derivative of $394,280 as of December 31, 2017 . The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The derivative associated with the Notes approximates management’s estimate of the fair value of the embedded derivative liability at December 31, 2017 based on using a Monte Carlo simulation following a Geometric Brownian Motion with the following assumptions: annual volatility of 62% present value discount rate of 12% and dividend yield of 0% . BAYBRIDGE CONVERTIBLE NOTE On December 6, 2017 , the Company entered into a securities exchange agreement (the “Exchange Agreement”) with BayBridge Capital Fund LP (“BayBridge”). Pursuant to the terms of the Exchange Agreement, the Investor agreed to surrender and exchange 675 shares of outstanding Series J Preferred Stock ( $755,417 of capital and accrued dividends). In exchange, the Company issued to the Investor an unsecured promissory note with an aggregate principal amount of $840,000 (the “Exchange Note”), with an original issue discount of $84,583 . Please refer to Note 21 for further discussion on the Series J Preferred Stock. The Exchange Note is unsecured, has no applicable registration rights, bears interest at a rate of 12% per annum, matures on December 6, 2018 , and contains standard and customary events of default including but not limited to: (i) failure to make payments when due under the Exchange Note, and (ii) bankruptcy or insolvency of the Company. Principal and interest are payable upon maturity. Payments of principal and accrued interest on the Exchange Note are payable in cash or, at the option of the Company, in shares of Common Stock at a variable conversion price equal to the lowest of (i) 85% of the average VWAP for the shares over the prior 5 trading days, (ii) the closing bid price for the shares on the prior trading day, or (iii) $0.003 per share. Payments in shares of Common Stock may not be issued pursuant to the Exchange Note if, after giving effect to the conversion or issuance, the holder together with its affiliates would beneficially own in excess of 9.99% of the outstanding shares of Common Stock. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Exchange Note was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. December 6, 2017 , the derivative liability associated with the promissory note was $1,048,311 . Since the value of the derivative was more than the liability and the original issue discount, the entire undiscounted liability of $755,417 was recorded as a debt discount to be amortized over the life of the liability. The remaining $292,894 was charged to interest expense. The derivative liability associated with the Exchange Note is subject to revaluation on a quarterly basis to reflect the market value change of the embedded conversion option. At December 31, 2017 , the Company conducted a fair value assessment of the embedded derivative associated with the Exchange Note. As a result of the fair value assessment, the Company recorded a $505,578 gain as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations, for the year ended December 31, 2017 , to properly reflect the fair value of the embedded derivative of $542,733 as of December 31, 2017 . The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The derivative associated with the Exchange Note approximates management’s estimate of the fair value of the embedded derivative liability at December 31, 2017 based on using a Monte Carlo simulation following a Geometric Brownian Motion with the following assumptions: annual volatility of 61% , present value discount rate of 12% and dividend yield of 0% . As of December 31, 2017 , principal of $275,000 had been converted into 404,411,765 shares of common stock and no cash payments of principal or interest had been made. The principal and accrued interest balances as of December 31, 2017 were $565,000 and $4,825 , respectively. |
Baybridge Convertible Note
Baybridge Convertible Note | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Convertible Note | NOTES PAYABLE On February 24, 2017 , the Company entered into an agreement with a vendor to convert the balance of their account into three notes payable in the aggregate amount of $765,784 . The notes bear interest of 6% per annum and matures on February 24, 2018 ; all outstanding principal and accrued interest is due and payable upon maturity. As of December 31, 2017 , the Company had not made any payments on these notes and the accrued interest was $39,565 . As of the date of this filing, this note has matured and is due and payable on demand. On February 27, 2017 , the Company entered into an agreement with a vendor to convert the balance of their account into a note payable in the amount of $49,500 . The note bears interest of 6% per annum and matures on September 27, 2017 ; all outstanding principal and accrued interest is due and payable upon maturity. On September 27, 2017 , the Company paid the note, plus $1,725 in accrued interest, in full. On March 23, 2017 , the Company entered into an agreement with a vendor to convert the balance of their account into a note payable in the amount of $356,742 . The note bears interest of 5% per annum and matures on October 23, 2017 ; all outstanding principal and accrued interest is due and payable upon maturity. On October 23, 2017 , the Company amended its promissory note with this vendor. The amendment extended the note's maturity to November 6, 2017 . Again on December 12, 2017 , the Company amended its promissory note with this vendor. The amendment extended the note's maturity to March 31, 2018 . As of December 31, 2017 , the Company had not made any payments on the note and the accrued interest was $13,830 . On June 30, 2017 , the Company entered into an agreement with a vendor to convert the balance of their account into a note payable in the amount of $250,000 . The note bears interest of 5% per annum and matures on February 28, 2018 ; all outstanding principal and accrued interest is due and payable upon maturity. As of December 31, 2017 , the Company had not made any payments on these notes and the accrued interest was $6,301 . As of the date of this filing, this note has matured and is due and payable on demand. On September 30, 2017 , the Company entered into a settlement agreement with a customer to convert the credit balance of their account into a note payable in the amount of $215,234 . The note bears interest of 5% per annum and matures on September 30, 2018 . Per the settlement agreement, monthly payments of $18,426 were to commence on October 30, 2017 . As of December 31, 2017 , one of the monthly payments had been made and the remaining principal and interest balances were $197,705 and $2,540 , respectively. SECURED PROMISSORY NOTE On November 30, 2017 , the Company, entered into a note purchase and exchange agreement (the “Note SPA”) with Global Ichiban Ltd (“Investor”), for the private placement of up to $2,000,000 of the Company’s Secured Convertible Promissory Notes (“Notes”) in exchange for $2,000,000 of gross proceeds in several tranches through June 2018, The closing of each tranche is conditioned upon the Company having an average daily trading volume for its Common Stock of at least $50,000 for the 20 trading day period preceding such future tranche closing dates. Pursuant to the terms of the Note SPA, the Company and the Investor also agreed to exchange certain outstanding securities held by the Investor for additional Notes. As of November 30, 2017 , the Investor surrendered for cancellation (i) its outstanding promissory note dated September 13, 2017 ( $3,359,539 principal and accrued interest), (ii) its outstanding promissory note dated October 31, 2017 ( $252,466 principal and accrued interest), and (iii) its 400 shares of outstanding Series J Preferred Stock ( $445,222 of capital and accrued dividends). In exchange, the Company issued to the Investor $4,057,227 aggregate principal amount of additional Notes. Please refer to Note 11 for further discussion on the canceled promissory notes and Note 21 on the canceled Series J Preferred Stock shares. Of the Notes issued on November 30, 2017 , $3,359,539 aggregate principal amount will mature on December 15, 2020 . Principal and interest will be payable in 36 equal monthly installments beginning January 15, 2018 . Of the Notes issued on November 30, 2017 , $697,688 aggregate principal amount will mature on November 30, 2018 . Principal and interest will be payable upon maturity. The $2,000,000 aggregate principal amount of Notes to be issued in the future in tranches pursuant to the Note SPA will mature on the first anniversary of the respective issuance date. Principal and interest will be payable upon maturity. As of December 31, 2017 , the closing dates, closing amounts, and maturity dates on completed Note SPA tranches are as follows: Closing Date Closing Amount Maturity Date 11/30/2017 $ 250,000 11/30/2018 12/28/2017 $ 250,000 12/28/2018 The Notes will be secured by a security interest on substantially all of the Company’s assets, bear interest at a rate of 12% per annum and contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the Notes, and (ii) bankruptcy or insolvency of the Company. There are no registration rights applicable to the Notes. All principal and accrued interest on the Notes are convertible at any time, in whole or in part, at the option of the Investor into shares of Common Stock at a variable conversion price equal to the lowest of (i) 85% of the average VWAP for the shares over the prior 5 trading days, (ii) the closing bid price for the shares on the prior trading day, or (iii) $0.002 per share The Notes may not be converted and shares of Common Stock may not be issued pursuant to the Notes if, after giving effect to the conversion or issuance, the holder together with its affiliates would beneficially own in excess of 9.99% of the outstanding shares of Common Stock. As of December 31, 2017 , the principal and interest balance of the Notes were $4,557,227 and $44,134 , respectively Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Notes were deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The derivative associated with the Notes approximates management’s estimate of the fair value of the embedded derivative liability based on using a Monte Carlo simulation following a Geometric Brownian Motion with the following assumptions identified below. Due to the varying terms and varying issue dates, the tranches of this instrument were broken into three separate instruments for valuation purposes. 1) The first valuation was done on the November 30, 2017 Note with term of three years. Management's analysis, using the following assumptions: annual volatility of 63% present value discount rate of 12% and a dividend yield of 0% , resulted in a fair value of the embedded derivative associated with this Note of $2,756,074 as of November 30, 2017. The value of the embedded derivative associated with the Note was recorded as a debt discount. 2) The second valuation was done on the group of Notes dated November 30, 2017 , that had a term of one year. Management's analysis, using the following assumptions: annual volatility of 67% present value discount rate of 12% and a dividend yield of 0% , resulted in a fair value of the embedded derivative associated with these Notes of $943,735 as of November 30, 2017. The value of the embedded derivative associated with the Note was recorded as a debt discount. 3) The third valuation was done on the Note dated December 28, 2017 , which had a term of one year. Management's analysis, using the following assumptions: annual volatility of 65% present value discount rate of 12% and a dividend yield of 0% , resulted in a fair value of the embedded derivative associated with this Note of $267,008 as of December 28, 2017. Since the value of the derivative was more than the liability, the entire liability of $250,000 was recorded as a debt discount to be amortized with the liability. The remaining balance of $17,008 was charged to interest expense. The derivative liability associated with the Notes is subject to revaluation on a quarterly basis to reflect the market value change of the embedded conversion option. At December 31, 2017 , the Company conducted a fair value assessment of the embedded derivative associated with the three valuation groups discussed above. 1) For the November 30, 2017 3yr Note: Management conducted a fair value assessment with the following assumptions: annual volatility of 63% present value discount rate of 12% and a dividend yield of 0% as of December 31, 2017 . As a result of the fair value assessment, the Company recorded a loss of $985,928 as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Consolidated Statements of Operations to properly reflect the fair value of the embedded derivative of $3,742,002 as of December 31, 2017 . 2) For the November 30, 2017 1yr Notes: Management conducted a fair value assessment with the following assumptions: annual volatility of 60% present value discount rate of 12% and a dividend yield of 0% as of December 31, 2017 . As a result of the fair value assessment, the Company recorded a gain of $55,567 as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Consolidated Statements of Operations to properly reflect the fair value of the embedded derivative of $888,168 as of December 31, 2017 . 3) There were no changes to the December 28, 2017 1yr note, as there was only one trading day for the year following the issuance. During the fourth quarter of 2017, a net loss of $930,361 had been recorded to reflect the total derivative liability of $4,897,178 as of December 31, 2017 . PROMISSORY NOTES Tertius Financial Group Notes and Exchange On August 29, 2016 , the Company entered into a note purchase agreement with Tertius Financial Group Pte. Ltd. ("TFG”) for the private placement of $330,000 of the Company’s original issue discount notes with an original maturity date of November 29, 2016 . The notes bear interest of 6% per annum and principal and interest on the notes are payable upon maturity. The notes are unsecured and not convertible into equity shares of the Company. On December 6, 2016 , the Company issued a new $600,000 original issue discount note to TFG in exchange for (i) $200,000 of additional gross proceeds and (ii) cancellation of the existing outstanding $330,000 note. The new TFG note bears interest at a rate of 6% per annum and matures on December 31, 2017 . Principal and interest on the new TFG note is payable at maturity. Following the transaction, the outstanding balance of the new note was $602,000 (including accrued and unpaid interest) with a discount of $60,000 . On January 19, 2017 , the Company issued 333,333,333 shares of unregistered common stock in a private placement to TFG pursuant to a Securities Purchase Agreement (the “SPA”). Pursuant to the SPA, the Company issued the 333,333,333 shares to TFG in exchange for cancellation of its $600,000 promissory note (including accrued interest of $4,340 ) that was issued by the Company on December 6, 2016 . The SPA does not provide any registration rights for the shares issued to TFG. TFG is a Singapore based entity controlled and 50% owned by Ascent’s President & CEO, Victor Lee, and owns approximately 3% of the Company's outstanding shares at December 31, 2017 . Offering of Unsecured Promissory Notes Between December 2016 and April 2017, the Company initiated eleven non-convertible, unsecured promissory notes with a private investor with varying principal amounts aggregating to $3,400,000 . The promissory notes bear interest of 12% per annum and mature six months from the respective dates of issuance, ranging from June 2, 2017 to October 21, 2017. Unless paid in advance, the principal and interest of these promissory notes are payable upon maturity. The notes are not convertible into equity shares of the Company and are unsecured. Between June and August, 2017, eight of the promissory notes described above matured. The Company and the private investor agreed to pay the interest accrued on these notes, as of the maturity dates, and extend the notes another three months without the Company being in default. Through August 30, 2017, $143,148 interest was paid. On September 13, 2017 , the Company and the investor entered into a Promissory Note Exchange Agreement. Pursuant to the agreement, the Investor exchanged and canceled the eleven outstanding promissory notes (with an aggregate principal and accrued interest of $3,504,199 ) for one new promissory note having a principal amount of approximately $3,504,199 . The new note has a term of three years, bears interest at a rate of 12% per annum, and calls for monthly installment payments of $116,390 commencing on October 13, 2017. The Company has the option to pay monthly installment amounts in the form of shares of common stock. Payments in the form of shares would be calculated using a variable conversion price equal to the lowest of (i) 85% of the average VWAP for the shares over the prior five trading days, (ii) the closing bid price for the shares on the prior trading day, or (iii) $0.004 per share. The Company may not make payments in the form of shares of Common Stock if, after giving effect to the issuance, the holder together with its affiliates would beneficially own in excess of 9.99% of the outstanding shares of Common Stock. On November 30, 2017 , the terms of this note were canceled and the remaining principal and accrued interest balance of $3,359,539 was combined with other instruments into a new Securities Purchase Agreement and secured note with the same investor. Please see Note. 10 for more information. Offering of Unsecured, Non-Convertible Notes During October 2016, the Company received $420,000 from a separate private investor. These funds, along with $250,000 of additional funding, were rolled into a promissory note, executed on January 17, 2017 , in the amount of $700,000 issued with a discount of $30,000 which will be charged to interest expense ratably over the term of the note. The note bears interest at 12% per annum and matures on July 17, 2017 . Principal and interest on this note are payable at maturity. This note is not convertible into equity shares of the Company and is unsecured. On June 30, 2017 , the Company and the private investor agreed to a twelve month payment plan on the balance of this promissory note. Interest will continue to accrue on this note at 12% per annum and payments of approximately $62,000 will be made monthly beginning in July 2017. Four monthly payments were made between July and October of 2017. As of December 31, 2017 , $205,563 of principal and $45,414 of interest had been paid on this note. The outstanding principal and accrued interest balances on the note as of December 31, 2017 were $494,437 and $27,126 , respectively. On April 6, 2017 , the Company initiated a non-convertible, unsecured promissory note with a private investor for $103,000 in exchange for proceeds of $100,000 . The discount of $3,000 will be charged to interest expense ratably over the term of the note. The promissory note bears interest of 10% per annum and matures on October 6, 2017 . On October 6, 2017 , the Company and its investor entered into a Promissory Note Exchange Agreement to convert a promissory note with a principal balance of $103,000 and accrued interest of $5,233 in to common shares. Per the terms of the agreement, the promissory note was canceled and 72,500,000 shares were issued. On May 8, 2017 , the Company initiated a non-convertible, unsecured promissory note with a private investor for $125,000 . The promissory note bears interest of 12% per annum and matures on September 8, 2017 . On September 8, 2017 , the Company redeemed this note, in full, for cash. On October 31, 2017 , the Company initiated a non-convertible, unsecured promissory note with a private investor for $250,000 . The promissory note bears interest of 12% per annum and matures on January 31, 2018 . On November 30, 2017 , the terms of this note were canceled and the remaining principal and accrued interest balance of $252,466 was combined with other instruments into a new Securities Purchase Agreement and secured note with the same investor. Please see Note. 10 for more information. On November 16, 2017 , the Company initiated a non-convertible, unsecured promissory note with a private investor for $275,000 . The promissory note was issued with an original issue discount of $25,000 , resulting in proceeds to the company of $250,000 . The note does not have a stated interest rate and matures on December 18, 2017 . As of December 31, 2017 , no payments had been made on this note and the discount had been recorded as interest expense. During December 2017, the Company received aggregate proceeds of $177,500 , from a private investor. These proceeds were incorporated into a promissory note on January 31, 2018 . Please refer to Note 30 for further information on this note. ST. GEORGE CONVERTIBLE NOTE On September 8, 2017 , the Company entered into a securities purchase agreement with St. George Investments, LLC (“Investor”), for the private placement of $1,725,000 principal amount of the Company’s Original Issue Discount Convertible Promissory Notes. On September 11, 2017 , the Company sold and issued $1,725,000 principal amount of the convertible notes to the Investor in exchange for $1,500,000 of gross proceeds, and paid $20,000 in financing costs. The original issue discount of $225,000 , and the financing fee, will be charged to interest expense, ratably, over the life of the note. Unless earlier converted or prepaid, the convertible notes will mature on March 11, 2019 . The notes do not bear interest in the absence of an event of default. For the first six months after the issuance of the notes, the Company will make a monthly cash repayment on the notes of approximately $96,000 . Thereafter, the Investor may request that the Company make monthly partial redemptions of the note up to $150,000 per month. If the Investor does not request the full $150,000 redemption amount in any one month, the unused portion of such monthly redemption amount can be added to future monthly redemption amounts. But in no event can the amount requested by the Investor for any one month exceed $275,000 . Redemption amounts are payable by the Company in cash. Beginning ten months after the issuance of the convertible notes, cash redemption payments by the Company will be subject to a 15% redemption premium. Beginning six months after the issuance of the convertible notes, the Company also has the option (subject to customary equity conditions) to pay redemption amounts in the form of shares of common stock. Payments in the form of shares would be calculated using a variable conversion price equal to the lower of (i) 85% of the average VWAP for the shares over the prior 5 trading days or (ii) the closing bid price for the shares on the prior trading day. All principal and accrued interest on the Notes are convertible at any time, in whole or in part, at the option of the Investor into shares of Common Stock at a fixed conversion price of $0.004 per share. The Notes contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the Notes; and (ii) bankruptcy or insolvency of the Company. Upon the occurrence of an event of default, the Notes will begin to bear interest at the rate of 22% per annum. In addition, upon the occurrence of an event of default, the Investor has the option to increase the outstanding balance of the Notes by 25% . In connection with the closing under the Note SPA, the Company issued $37,500,000 unregistered shares of common stock to the Investor as an origination fee. The closing stock price on the date of close was $0.0017 resulting in an interest expense of $63,750 being recorded as of the date of close. The Notes may not be converted and shares of Common Stock may not be issued pursuant to the Notes if, after giving effect to the conversion or issuance, the holder together with its affiliates would beneficially own in excess of 4.99% of the outstanding shares of Common Stock. Per the conditions of the SPA, a reserve of 1.88 billion shares was set up out of our authorized and unissued shares. During the fourth quarter of 2017, we made cash payments of $191,667 on this note, and as of December 31, 2017 , the principal balance on this note was $1,705,833 . In lieu of making the December 2017 payment, the share reserve was increased by 3 billion shares. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Notes were deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At closing, a derivative liability and a corresponding debt discount in the amount of $468,095 was recorded. The derivative liability associated with the Notes is subject to revaluation on a quarterly basis to reflect the market value change of the embedded conversion option. At December 31, 2017 , the Company conducted a fair value assessment of the embedded derivative associated with the Notes. As a result of the fair value assessment, the Company recorded a $151,504 loss as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations for the three months ended December 31, 2017 . The net gain recorded for the year ended December 31, 2017 was $73,815 , to properly reflect the fair value of the embedded derivative of $394,280 as of December 31, 2017 . The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The derivative associated with the Notes approximates management’s estimate of the fair value of the embedded derivative liability at December 31, 2017 based on using a Monte Carlo simulation following a Geometric Brownian Motion with the following assumptions: annual volatility of 62% present value discount rate of 12% and dividend yield of 0% . BAYBRIDGE CONVERTIBLE NOTE On December 6, 2017 , the Company entered into a securities exchange agreement (the “Exchange Agreement”) with BayBridge Capital Fund LP (“BayBridge”). Pursuant to the terms of the Exchange Agreement, the Investor agreed to surrender and exchange 675 shares of outstanding Series J Preferred Stock ( $755,417 of capital and accrued dividends). In exchange, the Company issued to the Investor an unsecured promissory note with an aggregate principal amount of $840,000 (the “Exchange Note”), with an original issue discount of $84,583 . Please refer to Note 21 for further discussion on the Series J Preferred Stock. The Exchange Note is unsecured, has no applicable registration rights, bears interest at a rate of 12% per annum, matures on December 6, 2018 , and contains standard and customary events of default including but not limited to: (i) failure to make payments when due under the Exchange Note, and (ii) bankruptcy or insolvency of the Company. Principal and interest are payable upon maturity. Payments of principal and accrued interest on the Exchange Note are payable in cash or, at the option of the Company, in shares of Common Stock at a variable conversion price equal to the lowest of (i) 85% of the average VWAP for the shares over the prior 5 trading days, (ii) the closing bid price for the shares on the prior trading day, or (iii) $0.003 per share. Payments in shares of Common Stock may not be issued pursuant to the Exchange Note if, after giving effect to the conversion or issuance, the holder together with its affiliates would beneficially own in excess of 9.99% of the outstanding shares of Common Stock. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Exchange Note was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. December 6, 2017 , the derivative liability associated with the promissory note was $1,048,311 . Since the value of the derivative was more than the liability and the original issue discount, the entire undiscounted liability of $755,417 was recorded as a debt discount to be amortized over the life of the liability. The remaining $292,894 was charged to interest expense. The derivative liability associated with the Exchange Note is subject to revaluation on a quarterly basis to reflect the market value change of the embedded conversion option. At December 31, 2017 , the Company conducted a fair value assessment of the embedded derivative associated with the Exchange Note. As a result of the fair value assessment, the Company recorded a $505,578 gain as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations, for the year ended December 31, 2017 , to properly reflect the fair value of the embedded derivative of $542,733 as of December 31, 2017 . The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The derivative associated with the Exchange Note approximates management’s estimate of the fair value of the embedded derivative liability at December 31, 2017 based on using a Monte Carlo simulation following a Geometric Brownian Motion with the following assumptions: annual volatility of 61% , present value discount rate of 12% and dividend yield of 0% . As of December 31, 2017 , principal of $275,000 had been converted into 404,411,765 shares of common stock and no cash payments of principal or interest had been made. The principal and accrued interest balances as of December 31, 2017 were $565,000 and $4,825 , respectively. |
Series A Preferred Stock
Series A Preferred Stock | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Preferred Stock | SERIES H PREFERRED STOCK AND JULY 2016 CONVERTIBLE NOTES Series H Preferred Stock On June 9, 2016 , the Company entered into a securities purchase agreement with a private investor to issue 2,500 shares of Series H Preferred Stock for $2,500,000 . The Company received gross proceeds of $250,000 at Closing. Additional gross proceeds of $580,000 were received by the Company through July 7, 2016. The Company agreed to exchange outstanding Series H Preferred Stock for Senior Secured Convertible Notes (“July 2016 Notes”) on July 13, 2016 . At the date of the exchange, the Company had sold and issued 830 shares of Series H Preferred Stock to the private investor in exchange for $830,000 of gross proceeds. Please see the section below for details of the exchange. July 2016 Convertible Notes On July 13, 2016 , the Company entered into a securities purchase agreement (the “Note SPA”) with the private investor for the private placement of $2,082,600 of the Company’s 4% Original Issue Discount Senior Secured Convertible Promissory Notes (the “July 2016 Convertible Notes”). On July 13, 2016 , the Company sold and issued $364,000 principal amount of notes to the investor in exchange for $350,000 of gross proceeds. The Company sold and issued the remaining $1,718,600 principal amount of July 2016 Convertible Notes to the investor in exchange for $1,650,000 of gross proceeds in weekly tranches between July and September 2016. The Company and the private investor also entered into an Exchange Agreement dated July 13, 2016 (the “Exchange Agreement”). Under the terms of the Exchange Agreement, the outstanding shares of Series H Preferred Stock (approximately $833,000 of capital and accrued dividends) were canceled. In exchange, the Company issued to the private investor approximately $866,000 of July 2016 Convertible Notes. There were 830 shares of Series H Preferred Stock outstanding as of the date of the Exchange Agreement. Unless earlier converted or prepaid, all of the July 2016 Convertible Notes will mature July 13, 2017 . The July 2016 Convertible Notes bear interest at a rate of 10% per annum, subject to increase to 24% per annum upon the occurrence and continuance of an event of default. Principal on the July 2016 Convertible Notes is payable on the Maturity Date. Interest on the July 2016 Convertible Notes is payable quarterly. Principal and interest are payable in cash or, if specified equity conditions are met, shares of Common Stock. The July 2016 Convertible Notes are secured by a security interest in substantially all of the Company’s assets. The subsidiaries of the Company have guaranteed the Company’s obligations under the July 2016 Convertible Notes. The July 2016 Convertible Notes contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the July 2016 Convertible Notes; (ii) bankruptcy or insolvency of the Company; and (iii) failure to file a registration statement by October 9, 2016. On October 10, 2016 the Company had not been successful in filing the registration statement triggering an event of default per the July 2016 Note Agreement. Upon default the interest rate increases to 24% per annum and the holder of the July 2016 Notes has the option to accelerate the Note and demand cash payment of the Mandatory Default Amount consisting of a 25% premium of the principal balance plus any accrued and unpaid interest. The Company began accruing interest at the rate of 24% on October 10, 2016. Forbearance and Settlement Agreement on July 2016 Convertible Notes On May 5, 2017 , the Company entered into a Forbearance and Settlement Agreement ("Forbearance Agreement") with a holder of certain secured convertible notes that are in default due to various triggering events. The holder and the Company agreed to forbear from taking any action provided for under the secured convertible notes in exchange for the following terms provided in this agreement: • The Company agreed to redeem for cash all secured convertible notes of the Company held by the holder no later than September 1, 2017 . • The Company affirmed that the current balance of owed principal and accrued and unpaid interest to the holder is $1,790,214 as of May 2, 2017 . • The redemption price for such secured convertible notes shall be 120% (if redeemed on or prior to August 15, 2017 ) or 125% (if redeemed after August 15, 2017 ) of the then outstanding principal, plus any accrued and unpaid interest. • During the month of May 2017, the Holder agreed to limit its conversions of outstanding Company secured convertible notes to $50,000 per calendar week of principal/interest. • During the months of June, July and August 2017, the holder agreed to limit its conversions of outstanding Company secured convertible notes to $75,000 per calendar week of principal/interest. • During the months of May, June, July and August 2017, the holder agreed that all outstanding Company secured convertible notes shall bear interest at the normal stated rate of 10% , rather than default rate of 24% . • All conversions during the months of May, June, July and August 2017 will be at the “triggering event” discount conversion price as stated in the secured convertible notes, and will continue at the “triggering event” discount price until, if and when the notes are redeemed. • Should the Company fail to redeem for cash all secured convertible notes on or before September 1, 2017 , default interest and normal stated interest will accrue from the date of execution of this agreement. All principal and accrued interest on the July 2016 Convertible Notes are convertible at any time, in whole or in part, at the option of the private investor, into shares of Common Stock at a variable conversion price equal to the lowest of (i) $0.045 (the “Fixed Conversion Price”), (ii) 70% of the lowest volume weighted average price (“VWAP”) of the Company's common stock for the ten consecutive trading day period prior to the conversion date or (iii) 70% of the lowest closing bid price of the Company's common stock for the ten consecutive trading day period prior to the conversion date. If certain defined triggering events occur, the conversion price would thereafter be reduced (and only reduced), to equal 60% of the lower of (i) the lowest closing bid price of the Company's common stock for the thirty consecutive trading day period prior to the conversion date or (ii) the lowest VWAP of the the Company's common stock for the thirty consecutive trading day period prior to the conversion date. In addition, on the 90th day and also on the 180th day from the date of the Note SPA, the private investor may reset the Fixed Conversion Price to thereafter be equal to the VWAP of the Common Stock for such day or if such 90th or 180th day is not a trading day, then the VWAP for the immediately preceding trading day. The following table summarizes the conversion activity on the principal of the July 2106 Convertible Notes: Conversion Period Principal Converted Common Shares Issued Q4 2016 $ 152,460 64,000,000 Q1 2017 1,017,732 959,704,543 Q2 2017 682,235 1,865,043,998 $ 1,852,427 2,888,748,541 In addition to the $1,852,427 in principal conversions, $3,960 of interest was converted during 2017. As of December 31, 2017 , with $1,096,600 of principal payments, $400,017 of interest payments, and $219,320 of redemption penalty payments, the July 2016 Convertible notes had been redeemed in full. The difference in the accrued interest and the paid interest, due to the terms of the settlement agreement, was $22,661 which was credited to interest expense upon full redemption of the instrument. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the July 2016 Convertible Notes was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At December 31, 2016 the fair value of the derivative liability was $3,733,348 . Throughout 2017, the Company recorded the fair value changes of the embedded derivative associated with the July 2016 Convertible Notes as a gain or loss in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $3,733,348 , to properly reflect the elimination of the embedded derivative upon the extinguishment of the liability. OCTOBER 2016 CONVERTIBLE NOTES AND EXCHANGE OF SERIES A PREFERRED STOCK October 2016 Convertible Notes On October 5, 2016 , the Company entered into a securities purchase agreement with a private investor (“Adar Bays”) for the private placement of $330,000 principal amount of October 2016 Convertible Notes. At Closing, the Company sold and issued $330,000 principal amount of October 2016 Convertible Notes to Adar Bays in exchange for $300,000 of gross proceeds. Unless earlier converted or prepaid, the October 2016 Convertible Notes will mature December 31, 2017 (the “Maturity Date”). The October 2016 Convertible Notes bear interest at a rate of 6% per annum, subject to increase to 24% per annum upon the occurrence and continuance of an event of default (as described below). Principal and accrued interest on the October 2016 Convertible Notes is payable on the Maturity Date. All principal and accrued interest on the October 2016 Convertible Notes are convertible at any time, in whole or in part, at the option of Adar Bays, into shares of common stock at a variable conversion price equal to 80% of the lowest closing bid price of the Company’s common stock for the 15 consecutive trading day period prior to the conversion date. After the six month anniversary of the issuance of any October 2016 Convertible Note, the conversion price for such note shall thereafter be equal to 50% of the lowest closing bid price of the Company’s common stock for the 15 consecutive trading day period prior to the conversion date. The October 2016 Convertible Notes contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the October 2016 Convertible Notes; and (ii) bankruptcy or insolvency of the Company. Outstanding principal and accrued interest on the October 2016 Convertible Notes were $330,000 and $24,860 , respectively as of December 31, 2017 . Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the October 2016 Convertible Notes were deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At closing, a derivative liability and a corresponding debt discount in the amount of $330,000 was recorded. The fair value of the derivative was greater than the face value at issuance and the difference of $341,114 was charged to interest expense at issuance. The remaining debt discount will be charged to interest expense ratably over the life of the October 2016 Convertible Notes. As of December 31, 2016 , the fair value of the derivative liability was $544,746 . The derivative liability associated with the October 2016 Convertible Notes is subject to revaluation on a quarterly basis to reflect the market value change of the embedded conversion option. At December 31, 2017 , the Company conducted a fair value assessment of the embedded derivative associated with the October 2016 Convertible Notes. As a result of the fair value assessment, the Company recorded a $279,442 loss as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations for the three months ended December 31, 2017 . The net loss recorded for the year ended December 31, 2017 was $27,897 , to properly reflect the fair value of the embedded derivative of $572,643 as of December 31, 2017 . The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The derivative associated with the October 2016 Convertible Notes approximates management’s estimate of the fair value of the embedded derivative liability at December 31, 2017 based on using a Monte Carlo simulation following a Geometric Brownian Motion with the following assumptions: annual volatility of 65% present value discount rate of 12% and dividend yield of 0% . Exchange of Outstanding Series A Preferred Stock for Convertible Notes In 2013, the Company completed private placement to one accredited investor (the “Series A Holder”) of its Series A Convertible Preferred Stock. Prior to the exchange agreement described below the Company had $165,541 shares of Series A Preferred Stock that remained outstanding as of October 6, 2016 . On October 6, 2016 , the Series A Holder entered into an exchange agreement (the “Exchange Agreement”) with Adar Bays. Pursuant to the exchange agreement, beginning December 5, 2016, Adar Bays has the option to exchange, from time to time, all or any portion of the October 2016 Convertible Notes for outstanding shares of Series A Preferred Stock from the Series A Holder. As of March 31, 2017, Adar Bays had elected to exchange all outstanding October 2016 Convertible Notes, in accordance with the exchange agreement, and the Series A Holder held $330,000 of the October 2016 Convertible Notes. SERIES A PREFERRED STOCK In June 2013, the Company entered into a Securities Purchase Agreement with an investor to sell an aggregate of 750,000 shares of Series A Preferred Stock at a price of $8 per share, resulting in gross proceeds of $6,000,000 . This purchase agreement included warrants to purchase up to 13,125 shares of common stock of the Company. The transfer of cash and securities took place incrementally, the first closing occurring on June 17, 2013 with the transfer of 125,000 shares of Series A Preferred Stock and a warrant to purchase 2,187 shares of common stock for $1,000,000 . The final closings took place in August 2013, with the transfer of 625,000 shares of Series A Preferred Stock and a warrant to purchase 10,938 shares of common stock for $5,000,000 . Holders of Series A Preferred Stock are entitled to cumulative dividends at a rate of 8% per annum when and if declared by the Board of Directors in its sole discretion. The dividends may be paid in cash or in the form of common stock (valued at 10% below market price, but not to exceed the lowest closing price during the applicable measurement period), at the discretion of the Board of Directors. The dividend rate on the Series A Preferred Stock is indexed to the Company's stock price and subject to adjustment. In addition, the Series A Preferred Stock contains a make-whole provision whereby, conversion or redemption of the preferred stock within 4 years of issuance will require dividends for the full four year period to be paid by the Company in cash or common stock (valued at 10% below market price, but not to exceed the lowest closing price during the applicable measurement period). This make-whole provision expired in June 2017 and future conversions and redemptions will be paid out with accrued dividends per the holding period of the shares of Series A Preferred stock. Please see Note 23 for more information. The Series A Preferred Stock may be converted into shares of common stock at the option of the Company if the closing price of the common stock exceeds $232 , as adjusted, for 20 consecutive trading days, or by the holder at any time. The Company has the right to redeem the Series A Preferred Stock at a price of $8 per share, plus any accrued and unpaid dividends, plus the make-whole amount (if applicable). At December 31, 2017 , the preferred shares were not eligible for conversion to common shares at the option of the Company. The holder of the preferred shares may convert to common shares at any time, at no cost, at a ratio of 1 preferred share into 1 common share (subject to standard ratable anti-dilution adjustments). Upon any conversion (whether at the option of the Company or the holder), the holder is entitled to receive any accrued but unpaid dividends. On October 6, 2016, the Series A Holder entered into an exchange agreement (the “Exchange Agreement”) with Adar Bays. Pursuant to the exchange agreement, beginning December 5, 2016, Adar Bays has the option to exchange, from time to time, all or any portion of the October 2016 Convertible Notes (see Note 13) for outstanding shares of Series A Preferred Stock from the Series A Holder. As of December 31, 2017 , Adar Bays had elected to exchange all outstanding October 2016 Convertible Notes, in accordance with the exchange agreement, resulting in the exchange of 104,785 shares of Series A Preferred Stock. As of December 31, 2017 , Adar Bays had also converted their 104,785 shares of Series A Preferred Stock, and the related make whole dividend, which resulted in the issuance of 173,946,250 shares of common stock. Except as otherwise required by law (or with respect to approval of certain actions), the Series A Preferred Stock shall have no voting rights. Upon any liquidation, dissolution or winding up of the Company, after payment or provision for payment of debts and other liabilities of the Company, the holders of Series A Preferred Stock shall be entitled to receive, pari passu with any distribution to the holders of common stock of the Company, an amount equal to $8 per share of Series A Preferred Stock plus any accrued and unpaid dividends. As of December 31, 2017 , there were 60,756 shares of Series A Preferred Stock outstanding and accrued and unpaid dividends of $279,815 . SERIES E PREFERRED STOCK AND THE COMMITTED EQUITY LINE Series E Preferred Stock On November 4, 2015 , the Company entered into a securities purchase agreement with a private investor to issue 2,800 shares of Series E Preferred Stock in exchange for $2,800,000 . Shares of the Series E Preferred Stock (including the amount of any accrued and unpaid dividends thereon) are convertible, at the option of the holder, into common stock at a variable conversion price equal to 80% of the average of the two lowest VWAPs of the Company's common stock for the ten consecutive trading day period prior to the conversion date. If certain defined default events occur, the conversion price would thereafter be reduced (and only reduced), to equal 70% of the average of the two lowest VWAPs of the Company's common stock for the twenty consecutive trading day period prior to the conversion date. The private investor had available to them a new conversion price beginning on June 9, 2016 as a result of the Series H Preferred Stock transaction further described in Note 12. Shares of the Series E Preferred Stock are now convertible, at the option of the private investor, into common stock at a variable conversion price equal to 70% of (i) the lowest VWAP of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. The following table summarizes the conversion activity of the Series E Preferred Stock: Conversion Period Preferred Series E Shares Converted Value of Series E Preferred Shares (inclusive of accrued dividends) Common Shares Issued Q4 2015 478 $ 481,500 250,000 Q1 2016 1,220 1,239,436 1,132,000 Q2 2016 365 381,414 7,979,568 Q3 2016 523 548,896 21,973,747 Q4 2016 94 101,018 13,089,675 Q1 2017 15 16,248 8,289,962 Q2 2017 35 38,886 134,927,207 Q3 2017 70 76,814 129,314,677 2,800 $ 2,884,212 316,956,836 Holders of the Series E Preferred Stock will be entitled to dividends in the amount of 7% per annum. During the year ended December 31, 2017 , the holder converted dividends in the amount of $11,948 on the Series E Preferred Stock, resulting in the issuance of 25,160,171 shares of common stock. On September 30, 2017, the Company paid $2,013 in cash for the remaining accrued dividends. The Company has issued 18,000 shares of common stock to the private investor as a commitment fee relating to the Series E Preferred Stock. Costs associated with the Series E Preferred Stock, such as legal fees and commitment shares are capitalized and reported as deferred financing costs on the Condensed Consolidated Balance Sheets. The total gross debt issuance cost incurred by the Company related to the Series E Preferred Stock was $104,000 . These debt issuance costs will be recognized as additional interest expense over the life of the Series E Preferred Stock. As of December 31, 2017 , all outstanding shares of Series E Preferred Stock, along with all accrued dividends, had either been converted or redeemed. The Company classified the Series E Preferred Stock as a liability pursuant to ASC 480 on the closing date due to the structure of the financing agreement, whereby the Company has an unconditional obligation that the Company may settle by issuing a variable number of common shares with a monetary value that is fixed and known at inception. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Series E Preferred Stock was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At December 31, 2016 the fair value of the derivative liability was $140,748 . At September 30, 2017, the Company recorded the reduction of the remaining embedded derivative associated with the Series E Preferred Stock of $121,390 as a gain in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $140,748 , to properly reflect the elimination of the embedded derivative as of December 31, 2017 . The Committed Equity Line On November 10, 2015, the Company and the private investor entered into a committed equity line purchase agreement (the "CEL"). Under the terms and subject to the conditions of the CEL purchase agreement, at its option the Company has the right to sell to the private investor, and the private investor is obligated to purchase from the Company, up to $32.2 million of the Company’s common stock, subject to certain limitations, from time to time, over the 36 -month period commencing on December 18, 2015, the date that the registration statement was declared effective by the SEC. From time to time, the Company may direct the private investor, at its sole discretion and subject to certain conditions, to purchase an amount of shares of common stock up to the lesser of (i) $1,000,000 or (ii) 300% of the average daily trading volume of the Company’s common stock over the preceding ten trading day period. The per share purchase price for shares of common stock to be sold by the Company under the CEL purchase agreement shall be equal to 80% of the average of the two lowest VWAPs of the common stock for the ten consecutive trading day period prior to the purchase date. In total, the Company directed the private investor to purchase $3,056,147 of common stock which resulted in the issuance of 1,368,000 shares of common stock. The Company may not direct the private investor to purchase shares of common stock more frequently than once each ten business days. The Company’s sales of shares of common stock to the private investor under the CEL purchase agreement are limited to no more than the number of shares that would result in the beneficial ownership by the private investor and its affiliates, at any single point in time, of more than 9.99% of the Company’s then outstanding shares of common stock. As consideration for entering into the CEL purchase agreement, the Company agreed to issue to the private investor 132,000 shares of common stock (the “Commitment Shares”). The Commitment Shares were issued to the private investor commencing upon the date that the registration statement was declared effective by the SEC. While not officially terminated, the CEL is no longer active and the Company does not consider this a viable source of capital. SERIES F PREFERRED STOCK On January 19, 2016 , the Company entered into a securities purchase agreement with a private investor for the sale of $7,000,000 of the Company’s newly designated Series F Preferred Stock. On January 20, 2016 , the Company sold and issued 7,000 shares of Series F Preferred Stock to the private investor. The aggregate purchase price of the Series F Preferred shares was $7,000,000 . On January 20, 2016 , the private investor paid $500,000 to the Company. The remaining $6,500,000 was paid by the private investor to the Company in 14 weekly increments of $500,000 or $250,000 beginning January 25, 2016 and ending April 28, 2016 . Shares of the Series F Preferred Stock (including the amount of any accrued and unpaid dividends thereon) are convertible, at the option of the holder, into common stock at a fixed conversion price equal to $5 per share. If certain defined default events occur, the conversion price would thereafter be reduced (and only reduced), to equal 70% of the average of the two lowest VWAPs of our common stock for the twenty consecutive trading day period prior to the conversion date. If requested by the private investor, the Company will make weekly redemptions of shares of Series F Preferred Stock (including any accrued and unpaid dividends thereon). If the redemption price is paid by the Company in cash, the number of shares to be redeemed in each weekly increment is 250 shares of Series F Preferred Stock, and the redemption price is a price per share equal to $1,250 plus any accrued but unpaid dividends thereon. The Company has the option to make such redemption payments in shares of common stock provided certain specified equity conditions are satisfied at the time of payment. The number of shares of common stock to be issued would be calculated using a per share price equal to 80% of the one lowest VWAP of our common stock for the ten consecutive trading day period prior to the payment date. For redemption payments made in shares of common stock, the Company will redeem either (i) 250 shares of Series F Preferred Stock or (ii) such greater number of shares of Series F Preferred Stock (and also including any accrued and unpaid dividends) that would result upon redemption in the issuance of a number of shares of common stock equal to 12% of the aggregate composite trading volume for the Company’s common stock during the preceding calendar week. The private investor had available to them a new conversion price beginning on June 9, 2016 as a result of the Series H Preferred Stock transaction further described in Note 12. Shares of the Series F Preferred Stock are now convertible, at the option of the private investor, into common stock at a variable conversion price equal to 70% of (i) the lowest VWAP of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. Amendment of Outstanding Series F Preferred Stock Conversion Price On October 5, 2016 , the Company filed a Certificate of Amendment to the Certificate of Designations of Preferences, Rights and Limitations of Series F Preferred Stock with the Secretary of State of the State of Delaware. The Certificate of Amendment amends the conversion price at which the Series F Preferred Stock can be converted into shares of common stock. The Company had approximately $336,000 of Series F Preferred Stock remaining outstanding as of October 5, 2016 . As amended, the conversion price will now be equal to the lowest of (i) 50% of the lowest weighted average price (“VWAP”) of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) 50% of the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. If certain “Triggering Events” specified in the terms of the Series F Preferred Stock occur, then the conversion price of the Series F Preferred Stock shall be thereafter reduced, and only reduced, to equal 50% of the average of the lowest traded price of the common stock for the twenty consecutive trading day period prior to the conversion date. The following table summarizes the conversion activity of the Series F Preferred Stock: Conversion Period Principal Converted Dividends Converted Common Shares Issued Q1 2016 $ 2,168,402 $ 19,896 2,183,991 Q2 2016 $ 3,234,000 $ 66,931 6,649,741 Q3 2016 $ 1,261,648 $ 54,096 81,917,367 Q4 2016 $ 175,949 $ 9,168 27,276,006 Q3 2017 $ 20,000 $ — 18,181,818 Q4 2017 $ 107,000 $ 467 172,552,354 $ 6,966,999 $ 150,558 308,761,277 Holders of the Series F Preferred Stock are entitled to dividends in the amount of 7% per annum. As of December 31, 2017 , all shares and accrued dividends had been converted and no balance remained. The Company classified the Series F Preferred Stock as a liability pursuant to ASC 480 on the closing date due to the structure of the financing agreement, whereby the Company has an unconditional obligation that the Company may settle by issuing a variable number of common shares with a monetary value that is fixed and known at inception. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Series F Preferred Stock was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At closing, a derivative liability and a corresponding debt discount in the amount of $1,666,000 were recorded. The debt discount will be charged to interest expense ratably over the life of the Series F Preferred Stock. The derivative balance was $255,324 , as of December 31, 2016 . At December 31, 2017 , the Company recorded the reduction of the remaining embedded derivative associated with the Series F Preferred Stock of $42,347 as a gain in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $255,324 , to properly reflect the elimination of the embedded derivative as of December 31, 2017 . SERIES G PREFERRED STOCK On April 29, 2016 , the Company entered into a securities purchase agreement with private investors to issue 2,000 shares of Series G Preferred Stock for $2,000,000 . The Company issued 2,000 shares of Series G Preferred Stock to the private investors, in various tranches between April and June 2016, resulting in gross proceeds to the Company of $2,000,000 . Holders of the Series G Preferred Stock are entitled to dividends in the amount of 10% per annum. One year after issuance, the Company is required to redeem for cash all or any portion of the outstanding shares of the Series G Preferred Stock at a price per share equal to $1,000 plus any accrued but unpaid dividends thereon. Assignment of Series G Preferred Stock Beginning September 19, 2016 , the two private investors (the “Series G Sellers”) entered into assignment agreements with accredited investors (the “Series G Purchasers”). Under the terms of the assignment agreements, the Series G Sellers may sell all 2,000 outstanding shares of Series G Preferred Stock to the Series G Purchasers for a purchase price of $1,000 per share of Series G Preferred Stock (plus the amount of any accrued and unpaid dividends thereon). During 2016 and 2017, the Series G Sellers had sold 1,795 shares of Series G Preferred Stock, representing a value of $1,795,000 , to the Series G Purchasers. On September 21, 2016 , the Company filed a Certificate of Amendment to the Certificate of Designations of Prefe |
Series E Preferred Stock and th
Series E Preferred Stock and the Committed Equity Line | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Preferred Stock | SERIES H PREFERRED STOCK AND JULY 2016 CONVERTIBLE NOTES Series H Preferred Stock On June 9, 2016 , the Company entered into a securities purchase agreement with a private investor to issue 2,500 shares of Series H Preferred Stock for $2,500,000 . The Company received gross proceeds of $250,000 at Closing. Additional gross proceeds of $580,000 were received by the Company through July 7, 2016. The Company agreed to exchange outstanding Series H Preferred Stock for Senior Secured Convertible Notes (“July 2016 Notes”) on July 13, 2016 . At the date of the exchange, the Company had sold and issued 830 shares of Series H Preferred Stock to the private investor in exchange for $830,000 of gross proceeds. Please see the section below for details of the exchange. July 2016 Convertible Notes On July 13, 2016 , the Company entered into a securities purchase agreement (the “Note SPA”) with the private investor for the private placement of $2,082,600 of the Company’s 4% Original Issue Discount Senior Secured Convertible Promissory Notes (the “July 2016 Convertible Notes”). On July 13, 2016 , the Company sold and issued $364,000 principal amount of notes to the investor in exchange for $350,000 of gross proceeds. The Company sold and issued the remaining $1,718,600 principal amount of July 2016 Convertible Notes to the investor in exchange for $1,650,000 of gross proceeds in weekly tranches between July and September 2016. The Company and the private investor also entered into an Exchange Agreement dated July 13, 2016 (the “Exchange Agreement”). Under the terms of the Exchange Agreement, the outstanding shares of Series H Preferred Stock (approximately $833,000 of capital and accrued dividends) were canceled. In exchange, the Company issued to the private investor approximately $866,000 of July 2016 Convertible Notes. There were 830 shares of Series H Preferred Stock outstanding as of the date of the Exchange Agreement. Unless earlier converted or prepaid, all of the July 2016 Convertible Notes will mature July 13, 2017 . The July 2016 Convertible Notes bear interest at a rate of 10% per annum, subject to increase to 24% per annum upon the occurrence and continuance of an event of default. Principal on the July 2016 Convertible Notes is payable on the Maturity Date. Interest on the July 2016 Convertible Notes is payable quarterly. Principal and interest are payable in cash or, if specified equity conditions are met, shares of Common Stock. The July 2016 Convertible Notes are secured by a security interest in substantially all of the Company’s assets. The subsidiaries of the Company have guaranteed the Company’s obligations under the July 2016 Convertible Notes. The July 2016 Convertible Notes contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the July 2016 Convertible Notes; (ii) bankruptcy or insolvency of the Company; and (iii) failure to file a registration statement by October 9, 2016. On October 10, 2016 the Company had not been successful in filing the registration statement triggering an event of default per the July 2016 Note Agreement. Upon default the interest rate increases to 24% per annum and the holder of the July 2016 Notes has the option to accelerate the Note and demand cash payment of the Mandatory Default Amount consisting of a 25% premium of the principal balance plus any accrued and unpaid interest. The Company began accruing interest at the rate of 24% on October 10, 2016. Forbearance and Settlement Agreement on July 2016 Convertible Notes On May 5, 2017 , the Company entered into a Forbearance and Settlement Agreement ("Forbearance Agreement") with a holder of certain secured convertible notes that are in default due to various triggering events. The holder and the Company agreed to forbear from taking any action provided for under the secured convertible notes in exchange for the following terms provided in this agreement: • The Company agreed to redeem for cash all secured convertible notes of the Company held by the holder no later than September 1, 2017 . • The Company affirmed that the current balance of owed principal and accrued and unpaid interest to the holder is $1,790,214 as of May 2, 2017 . • The redemption price for such secured convertible notes shall be 120% (if redeemed on or prior to August 15, 2017 ) or 125% (if redeemed after August 15, 2017 ) of the then outstanding principal, plus any accrued and unpaid interest. • During the month of May 2017, the Holder agreed to limit its conversions of outstanding Company secured convertible notes to $50,000 per calendar week of principal/interest. • During the months of June, July and August 2017, the holder agreed to limit its conversions of outstanding Company secured convertible notes to $75,000 per calendar week of principal/interest. • During the months of May, June, July and August 2017, the holder agreed that all outstanding Company secured convertible notes shall bear interest at the normal stated rate of 10% , rather than default rate of 24% . • All conversions during the months of May, June, July and August 2017 will be at the “triggering event” discount conversion price as stated in the secured convertible notes, and will continue at the “triggering event” discount price until, if and when the notes are redeemed. • Should the Company fail to redeem for cash all secured convertible notes on or before September 1, 2017 , default interest and normal stated interest will accrue from the date of execution of this agreement. All principal and accrued interest on the July 2016 Convertible Notes are convertible at any time, in whole or in part, at the option of the private investor, into shares of Common Stock at a variable conversion price equal to the lowest of (i) $0.045 (the “Fixed Conversion Price”), (ii) 70% of the lowest volume weighted average price (“VWAP”) of the Company's common stock for the ten consecutive trading day period prior to the conversion date or (iii) 70% of the lowest closing bid price of the Company's common stock for the ten consecutive trading day period prior to the conversion date. If certain defined triggering events occur, the conversion price would thereafter be reduced (and only reduced), to equal 60% of the lower of (i) the lowest closing bid price of the Company's common stock for the thirty consecutive trading day period prior to the conversion date or (ii) the lowest VWAP of the the Company's common stock for the thirty consecutive trading day period prior to the conversion date. In addition, on the 90th day and also on the 180th day from the date of the Note SPA, the private investor may reset the Fixed Conversion Price to thereafter be equal to the VWAP of the Common Stock for such day or if such 90th or 180th day is not a trading day, then the VWAP for the immediately preceding trading day. The following table summarizes the conversion activity on the principal of the July 2106 Convertible Notes: Conversion Period Principal Converted Common Shares Issued Q4 2016 $ 152,460 64,000,000 Q1 2017 1,017,732 959,704,543 Q2 2017 682,235 1,865,043,998 $ 1,852,427 2,888,748,541 In addition to the $1,852,427 in principal conversions, $3,960 of interest was converted during 2017. As of December 31, 2017 , with $1,096,600 of principal payments, $400,017 of interest payments, and $219,320 of redemption penalty payments, the July 2016 Convertible notes had been redeemed in full. The difference in the accrued interest and the paid interest, due to the terms of the settlement agreement, was $22,661 which was credited to interest expense upon full redemption of the instrument. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the July 2016 Convertible Notes was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At December 31, 2016 the fair value of the derivative liability was $3,733,348 . Throughout 2017, the Company recorded the fair value changes of the embedded derivative associated with the July 2016 Convertible Notes as a gain or loss in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $3,733,348 , to properly reflect the elimination of the embedded derivative upon the extinguishment of the liability. OCTOBER 2016 CONVERTIBLE NOTES AND EXCHANGE OF SERIES A PREFERRED STOCK October 2016 Convertible Notes On October 5, 2016 , the Company entered into a securities purchase agreement with a private investor (“Adar Bays”) for the private placement of $330,000 principal amount of October 2016 Convertible Notes. At Closing, the Company sold and issued $330,000 principal amount of October 2016 Convertible Notes to Adar Bays in exchange for $300,000 of gross proceeds. Unless earlier converted or prepaid, the October 2016 Convertible Notes will mature December 31, 2017 (the “Maturity Date”). The October 2016 Convertible Notes bear interest at a rate of 6% per annum, subject to increase to 24% per annum upon the occurrence and continuance of an event of default (as described below). Principal and accrued interest on the October 2016 Convertible Notes is payable on the Maturity Date. All principal and accrued interest on the October 2016 Convertible Notes are convertible at any time, in whole or in part, at the option of Adar Bays, into shares of common stock at a variable conversion price equal to 80% of the lowest closing bid price of the Company’s common stock for the 15 consecutive trading day period prior to the conversion date. After the six month anniversary of the issuance of any October 2016 Convertible Note, the conversion price for such note shall thereafter be equal to 50% of the lowest closing bid price of the Company’s common stock for the 15 consecutive trading day period prior to the conversion date. The October 2016 Convertible Notes contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the October 2016 Convertible Notes; and (ii) bankruptcy or insolvency of the Company. Outstanding principal and accrued interest on the October 2016 Convertible Notes were $330,000 and $24,860 , respectively as of December 31, 2017 . Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the October 2016 Convertible Notes were deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At closing, a derivative liability and a corresponding debt discount in the amount of $330,000 was recorded. The fair value of the derivative was greater than the face value at issuance and the difference of $341,114 was charged to interest expense at issuance. The remaining debt discount will be charged to interest expense ratably over the life of the October 2016 Convertible Notes. As of December 31, 2016 , the fair value of the derivative liability was $544,746 . The derivative liability associated with the October 2016 Convertible Notes is subject to revaluation on a quarterly basis to reflect the market value change of the embedded conversion option. At December 31, 2017 , the Company conducted a fair value assessment of the embedded derivative associated with the October 2016 Convertible Notes. As a result of the fair value assessment, the Company recorded a $279,442 loss as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations for the three months ended December 31, 2017 . The net loss recorded for the year ended December 31, 2017 was $27,897 , to properly reflect the fair value of the embedded derivative of $572,643 as of December 31, 2017 . The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The derivative associated with the October 2016 Convertible Notes approximates management’s estimate of the fair value of the embedded derivative liability at December 31, 2017 based on using a Monte Carlo simulation following a Geometric Brownian Motion with the following assumptions: annual volatility of 65% present value discount rate of 12% and dividend yield of 0% . Exchange of Outstanding Series A Preferred Stock for Convertible Notes In 2013, the Company completed private placement to one accredited investor (the “Series A Holder”) of its Series A Convertible Preferred Stock. Prior to the exchange agreement described below the Company had $165,541 shares of Series A Preferred Stock that remained outstanding as of October 6, 2016 . On October 6, 2016 , the Series A Holder entered into an exchange agreement (the “Exchange Agreement”) with Adar Bays. Pursuant to the exchange agreement, beginning December 5, 2016, Adar Bays has the option to exchange, from time to time, all or any portion of the October 2016 Convertible Notes for outstanding shares of Series A Preferred Stock from the Series A Holder. As of March 31, 2017, Adar Bays had elected to exchange all outstanding October 2016 Convertible Notes, in accordance with the exchange agreement, and the Series A Holder held $330,000 of the October 2016 Convertible Notes. SERIES A PREFERRED STOCK In June 2013, the Company entered into a Securities Purchase Agreement with an investor to sell an aggregate of 750,000 shares of Series A Preferred Stock at a price of $8 per share, resulting in gross proceeds of $6,000,000 . This purchase agreement included warrants to purchase up to 13,125 shares of common stock of the Company. The transfer of cash and securities took place incrementally, the first closing occurring on June 17, 2013 with the transfer of 125,000 shares of Series A Preferred Stock and a warrant to purchase 2,187 shares of common stock for $1,000,000 . The final closings took place in August 2013, with the transfer of 625,000 shares of Series A Preferred Stock and a warrant to purchase 10,938 shares of common stock for $5,000,000 . Holders of Series A Preferred Stock are entitled to cumulative dividends at a rate of 8% per annum when and if declared by the Board of Directors in its sole discretion. The dividends may be paid in cash or in the form of common stock (valued at 10% below market price, but not to exceed the lowest closing price during the applicable measurement period), at the discretion of the Board of Directors. The dividend rate on the Series A Preferred Stock is indexed to the Company's stock price and subject to adjustment. In addition, the Series A Preferred Stock contains a make-whole provision whereby, conversion or redemption of the preferred stock within 4 years of issuance will require dividends for the full four year period to be paid by the Company in cash or common stock (valued at 10% below market price, but not to exceed the lowest closing price during the applicable measurement period). This make-whole provision expired in June 2017 and future conversions and redemptions will be paid out with accrued dividends per the holding period of the shares of Series A Preferred stock. Please see Note 23 for more information. The Series A Preferred Stock may be converted into shares of common stock at the option of the Company if the closing price of the common stock exceeds $232 , as adjusted, for 20 consecutive trading days, or by the holder at any time. The Company has the right to redeem the Series A Preferred Stock at a price of $8 per share, plus any accrued and unpaid dividends, plus the make-whole amount (if applicable). At December 31, 2017 , the preferred shares were not eligible for conversion to common shares at the option of the Company. The holder of the preferred shares may convert to common shares at any time, at no cost, at a ratio of 1 preferred share into 1 common share (subject to standard ratable anti-dilution adjustments). Upon any conversion (whether at the option of the Company or the holder), the holder is entitled to receive any accrued but unpaid dividends. On October 6, 2016, the Series A Holder entered into an exchange agreement (the “Exchange Agreement”) with Adar Bays. Pursuant to the exchange agreement, beginning December 5, 2016, Adar Bays has the option to exchange, from time to time, all or any portion of the October 2016 Convertible Notes (see Note 13) for outstanding shares of Series A Preferred Stock from the Series A Holder. As of December 31, 2017 , Adar Bays had elected to exchange all outstanding October 2016 Convertible Notes, in accordance with the exchange agreement, resulting in the exchange of 104,785 shares of Series A Preferred Stock. As of December 31, 2017 , Adar Bays had also converted their 104,785 shares of Series A Preferred Stock, and the related make whole dividend, which resulted in the issuance of 173,946,250 shares of common stock. Except as otherwise required by law (or with respect to approval of certain actions), the Series A Preferred Stock shall have no voting rights. Upon any liquidation, dissolution or winding up of the Company, after payment or provision for payment of debts and other liabilities of the Company, the holders of Series A Preferred Stock shall be entitled to receive, pari passu with any distribution to the holders of common stock of the Company, an amount equal to $8 per share of Series A Preferred Stock plus any accrued and unpaid dividends. As of December 31, 2017 , there were 60,756 shares of Series A Preferred Stock outstanding and accrued and unpaid dividends of $279,815 . SERIES E PREFERRED STOCK AND THE COMMITTED EQUITY LINE Series E Preferred Stock On November 4, 2015 , the Company entered into a securities purchase agreement with a private investor to issue 2,800 shares of Series E Preferred Stock in exchange for $2,800,000 . Shares of the Series E Preferred Stock (including the amount of any accrued and unpaid dividends thereon) are convertible, at the option of the holder, into common stock at a variable conversion price equal to 80% of the average of the two lowest VWAPs of the Company's common stock for the ten consecutive trading day period prior to the conversion date. If certain defined default events occur, the conversion price would thereafter be reduced (and only reduced), to equal 70% of the average of the two lowest VWAPs of the Company's common stock for the twenty consecutive trading day period prior to the conversion date. The private investor had available to them a new conversion price beginning on June 9, 2016 as a result of the Series H Preferred Stock transaction further described in Note 12. Shares of the Series E Preferred Stock are now convertible, at the option of the private investor, into common stock at a variable conversion price equal to 70% of (i) the lowest VWAP of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. The following table summarizes the conversion activity of the Series E Preferred Stock: Conversion Period Preferred Series E Shares Converted Value of Series E Preferred Shares (inclusive of accrued dividends) Common Shares Issued Q4 2015 478 $ 481,500 250,000 Q1 2016 1,220 1,239,436 1,132,000 Q2 2016 365 381,414 7,979,568 Q3 2016 523 548,896 21,973,747 Q4 2016 94 101,018 13,089,675 Q1 2017 15 16,248 8,289,962 Q2 2017 35 38,886 134,927,207 Q3 2017 70 76,814 129,314,677 2,800 $ 2,884,212 316,956,836 Holders of the Series E Preferred Stock will be entitled to dividends in the amount of 7% per annum. During the year ended December 31, 2017 , the holder converted dividends in the amount of $11,948 on the Series E Preferred Stock, resulting in the issuance of 25,160,171 shares of common stock. On September 30, 2017, the Company paid $2,013 in cash for the remaining accrued dividends. The Company has issued 18,000 shares of common stock to the private investor as a commitment fee relating to the Series E Preferred Stock. Costs associated with the Series E Preferred Stock, such as legal fees and commitment shares are capitalized and reported as deferred financing costs on the Condensed Consolidated Balance Sheets. The total gross debt issuance cost incurred by the Company related to the Series E Preferred Stock was $104,000 . These debt issuance costs will be recognized as additional interest expense over the life of the Series E Preferred Stock. As of December 31, 2017 , all outstanding shares of Series E Preferred Stock, along with all accrued dividends, had either been converted or redeemed. The Company classified the Series E Preferred Stock as a liability pursuant to ASC 480 on the closing date due to the structure of the financing agreement, whereby the Company has an unconditional obligation that the Company may settle by issuing a variable number of common shares with a monetary value that is fixed and known at inception. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Series E Preferred Stock was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At December 31, 2016 the fair value of the derivative liability was $140,748 . At September 30, 2017, the Company recorded the reduction of the remaining embedded derivative associated with the Series E Preferred Stock of $121,390 as a gain in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $140,748 , to properly reflect the elimination of the embedded derivative as of December 31, 2017 . The Committed Equity Line On November 10, 2015, the Company and the private investor entered into a committed equity line purchase agreement (the "CEL"). Under the terms and subject to the conditions of the CEL purchase agreement, at its option the Company has the right to sell to the private investor, and the private investor is obligated to purchase from the Company, up to $32.2 million of the Company’s common stock, subject to certain limitations, from time to time, over the 36 -month period commencing on December 18, 2015, the date that the registration statement was declared effective by the SEC. From time to time, the Company may direct the private investor, at its sole discretion and subject to certain conditions, to purchase an amount of shares of common stock up to the lesser of (i) $1,000,000 or (ii) 300% of the average daily trading volume of the Company’s common stock over the preceding ten trading day period. The per share purchase price for shares of common stock to be sold by the Company under the CEL purchase agreement shall be equal to 80% of the average of the two lowest VWAPs of the common stock for the ten consecutive trading day period prior to the purchase date. In total, the Company directed the private investor to purchase $3,056,147 of common stock which resulted in the issuance of 1,368,000 shares of common stock. The Company may not direct the private investor to purchase shares of common stock more frequently than once each ten business days. The Company’s sales of shares of common stock to the private investor under the CEL purchase agreement are limited to no more than the number of shares that would result in the beneficial ownership by the private investor and its affiliates, at any single point in time, of more than 9.99% of the Company’s then outstanding shares of common stock. As consideration for entering into the CEL purchase agreement, the Company agreed to issue to the private investor 132,000 shares of common stock (the “Commitment Shares”). The Commitment Shares were issued to the private investor commencing upon the date that the registration statement was declared effective by the SEC. While not officially terminated, the CEL is no longer active and the Company does not consider this a viable source of capital. SERIES F PREFERRED STOCK On January 19, 2016 , the Company entered into a securities purchase agreement with a private investor for the sale of $7,000,000 of the Company’s newly designated Series F Preferred Stock. On January 20, 2016 , the Company sold and issued 7,000 shares of Series F Preferred Stock to the private investor. The aggregate purchase price of the Series F Preferred shares was $7,000,000 . On January 20, 2016 , the private investor paid $500,000 to the Company. The remaining $6,500,000 was paid by the private investor to the Company in 14 weekly increments of $500,000 or $250,000 beginning January 25, 2016 and ending April 28, 2016 . Shares of the Series F Preferred Stock (including the amount of any accrued and unpaid dividends thereon) are convertible, at the option of the holder, into common stock at a fixed conversion price equal to $5 per share. If certain defined default events occur, the conversion price would thereafter be reduced (and only reduced), to equal 70% of the average of the two lowest VWAPs of our common stock for the twenty consecutive trading day period prior to the conversion date. If requested by the private investor, the Company will make weekly redemptions of shares of Series F Preferred Stock (including any accrued and unpaid dividends thereon). If the redemption price is paid by the Company in cash, the number of shares to be redeemed in each weekly increment is 250 shares of Series F Preferred Stock, and the redemption price is a price per share equal to $1,250 plus any accrued but unpaid dividends thereon. The Company has the option to make such redemption payments in shares of common stock provided certain specified equity conditions are satisfied at the time of payment. The number of shares of common stock to be issued would be calculated using a per share price equal to 80% of the one lowest VWAP of our common stock for the ten consecutive trading day period prior to the payment date. For redemption payments made in shares of common stock, the Company will redeem either (i) 250 shares of Series F Preferred Stock or (ii) such greater number of shares of Series F Preferred Stock (and also including any accrued and unpaid dividends) that would result upon redemption in the issuance of a number of shares of common stock equal to 12% of the aggregate composite trading volume for the Company’s common stock during the preceding calendar week. The private investor had available to them a new conversion price beginning on June 9, 2016 as a result of the Series H Preferred Stock transaction further described in Note 12. Shares of the Series F Preferred Stock are now convertible, at the option of the private investor, into common stock at a variable conversion price equal to 70% of (i) the lowest VWAP of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. Amendment of Outstanding Series F Preferred Stock Conversion Price On October 5, 2016 , the Company filed a Certificate of Amendment to the Certificate of Designations of Preferences, Rights and Limitations of Series F Preferred Stock with the Secretary of State of the State of Delaware. The Certificate of Amendment amends the conversion price at which the Series F Preferred Stock can be converted into shares of common stock. The Company had approximately $336,000 of Series F Preferred Stock remaining outstanding as of October 5, 2016 . As amended, the conversion price will now be equal to the lowest of (i) 50% of the lowest weighted average price (“VWAP”) of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) 50% of the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. If certain “Triggering Events” specified in the terms of the Series F Preferred Stock occur, then the conversion price of the Series F Preferred Stock shall be thereafter reduced, and only reduced, to equal 50% of the average of the lowest traded price of the common stock for the twenty consecutive trading day period prior to the conversion date. The following table summarizes the conversion activity of the Series F Preferred Stock: Conversion Period Principal Converted Dividends Converted Common Shares Issued Q1 2016 $ 2,168,402 $ 19,896 2,183,991 Q2 2016 $ 3,234,000 $ 66,931 6,649,741 Q3 2016 $ 1,261,648 $ 54,096 81,917,367 Q4 2016 $ 175,949 $ 9,168 27,276,006 Q3 2017 $ 20,000 $ — 18,181,818 Q4 2017 $ 107,000 $ 467 172,552,354 $ 6,966,999 $ 150,558 308,761,277 Holders of the Series F Preferred Stock are entitled to dividends in the amount of 7% per annum. As of December 31, 2017 , all shares and accrued dividends had been converted and no balance remained. The Company classified the Series F Preferred Stock as a liability pursuant to ASC 480 on the closing date due to the structure of the financing agreement, whereby the Company has an unconditional obligation that the Company may settle by issuing a variable number of common shares with a monetary value that is fixed and known at inception. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Series F Preferred Stock was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At closing, a derivative liability and a corresponding debt discount in the amount of $1,666,000 were recorded. The debt discount will be charged to interest expense ratably over the life of the Series F Preferred Stock. The derivative balance was $255,324 , as of December 31, 2016 . At December 31, 2017 , the Company recorded the reduction of the remaining embedded derivative associated with the Series F Preferred Stock of $42,347 as a gain in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $255,324 , to properly reflect the elimination of the embedded derivative as of December 31, 2017 . SERIES G PREFERRED STOCK On April 29, 2016 , the Company entered into a securities purchase agreement with private investors to issue 2,000 shares of Series G Preferred Stock for $2,000,000 . The Company issued 2,000 shares of Series G Preferred Stock to the private investors, in various tranches between April and June 2016, resulting in gross proceeds to the Company of $2,000,000 . Holders of the Series G Preferred Stock are entitled to dividends in the amount of 10% per annum. One year after issuance, the Company is required to redeem for cash all or any portion of the outstanding shares of the Series G Preferred Stock at a price per share equal to $1,000 plus any accrued but unpaid dividends thereon. Assignment of Series G Preferred Stock Beginning September 19, 2016 , the two private investors (the “Series G Sellers”) entered into assignment agreements with accredited investors (the “Series G Purchasers”). Under the terms of the assignment agreements, the Series G Sellers may sell all 2,000 outstanding shares of Series G Preferred Stock to the Series G Purchasers for a purchase price of $1,000 per share of Series G Preferred Stock (plus the amount of any accrued and unpaid dividends thereon). During 2016 and 2017, the Series G Sellers had sold 1,795 shares of Series G Preferred Stock, representing a value of $1,795,000 , to the Series G Purchasers. On September 21, 2016 , the Company filed a Certificate of Amendment to the Certificate of Designations of Prefe |
Series F Preferred Stock
Series F Preferred Stock | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Preferred Stock | SERIES H PREFERRED STOCK AND JULY 2016 CONVERTIBLE NOTES Series H Preferred Stock On June 9, 2016 , the Company entered into a securities purchase agreement with a private investor to issue 2,500 shares of Series H Preferred Stock for $2,500,000 . The Company received gross proceeds of $250,000 at Closing. Additional gross proceeds of $580,000 were received by the Company through July 7, 2016. The Company agreed to exchange outstanding Series H Preferred Stock for Senior Secured Convertible Notes (“July 2016 Notes”) on July 13, 2016 . At the date of the exchange, the Company had sold and issued 830 shares of Series H Preferred Stock to the private investor in exchange for $830,000 of gross proceeds. Please see the section below for details of the exchange. July 2016 Convertible Notes On July 13, 2016 , the Company entered into a securities purchase agreement (the “Note SPA”) with the private investor for the private placement of $2,082,600 of the Company’s 4% Original Issue Discount Senior Secured Convertible Promissory Notes (the “July 2016 Convertible Notes”). On July 13, 2016 , the Company sold and issued $364,000 principal amount of notes to the investor in exchange for $350,000 of gross proceeds. The Company sold and issued the remaining $1,718,600 principal amount of July 2016 Convertible Notes to the investor in exchange for $1,650,000 of gross proceeds in weekly tranches between July and September 2016. The Company and the private investor also entered into an Exchange Agreement dated July 13, 2016 (the “Exchange Agreement”). Under the terms of the Exchange Agreement, the outstanding shares of Series H Preferred Stock (approximately $833,000 of capital and accrued dividends) were canceled. In exchange, the Company issued to the private investor approximately $866,000 of July 2016 Convertible Notes. There were 830 shares of Series H Preferred Stock outstanding as of the date of the Exchange Agreement. Unless earlier converted or prepaid, all of the July 2016 Convertible Notes will mature July 13, 2017 . The July 2016 Convertible Notes bear interest at a rate of 10% per annum, subject to increase to 24% per annum upon the occurrence and continuance of an event of default. Principal on the July 2016 Convertible Notes is payable on the Maturity Date. Interest on the July 2016 Convertible Notes is payable quarterly. Principal and interest are payable in cash or, if specified equity conditions are met, shares of Common Stock. The July 2016 Convertible Notes are secured by a security interest in substantially all of the Company’s assets. The subsidiaries of the Company have guaranteed the Company’s obligations under the July 2016 Convertible Notes. The July 2016 Convertible Notes contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the July 2016 Convertible Notes; (ii) bankruptcy or insolvency of the Company; and (iii) failure to file a registration statement by October 9, 2016. On October 10, 2016 the Company had not been successful in filing the registration statement triggering an event of default per the July 2016 Note Agreement. Upon default the interest rate increases to 24% per annum and the holder of the July 2016 Notes has the option to accelerate the Note and demand cash payment of the Mandatory Default Amount consisting of a 25% premium of the principal balance plus any accrued and unpaid interest. The Company began accruing interest at the rate of 24% on October 10, 2016. Forbearance and Settlement Agreement on July 2016 Convertible Notes On May 5, 2017 , the Company entered into a Forbearance and Settlement Agreement ("Forbearance Agreement") with a holder of certain secured convertible notes that are in default due to various triggering events. The holder and the Company agreed to forbear from taking any action provided for under the secured convertible notes in exchange for the following terms provided in this agreement: • The Company agreed to redeem for cash all secured convertible notes of the Company held by the holder no later than September 1, 2017 . • The Company affirmed that the current balance of owed principal and accrued and unpaid interest to the holder is $1,790,214 as of May 2, 2017 . • The redemption price for such secured convertible notes shall be 120% (if redeemed on or prior to August 15, 2017 ) or 125% (if redeemed after August 15, 2017 ) of the then outstanding principal, plus any accrued and unpaid interest. • During the month of May 2017, the Holder agreed to limit its conversions of outstanding Company secured convertible notes to $50,000 per calendar week of principal/interest. • During the months of June, July and August 2017, the holder agreed to limit its conversions of outstanding Company secured convertible notes to $75,000 per calendar week of principal/interest. • During the months of May, June, July and August 2017, the holder agreed that all outstanding Company secured convertible notes shall bear interest at the normal stated rate of 10% , rather than default rate of 24% . • All conversions during the months of May, June, July and August 2017 will be at the “triggering event” discount conversion price as stated in the secured convertible notes, and will continue at the “triggering event” discount price until, if and when the notes are redeemed. • Should the Company fail to redeem for cash all secured convertible notes on or before September 1, 2017 , default interest and normal stated interest will accrue from the date of execution of this agreement. All principal and accrued interest on the July 2016 Convertible Notes are convertible at any time, in whole or in part, at the option of the private investor, into shares of Common Stock at a variable conversion price equal to the lowest of (i) $0.045 (the “Fixed Conversion Price”), (ii) 70% of the lowest volume weighted average price (“VWAP”) of the Company's common stock for the ten consecutive trading day period prior to the conversion date or (iii) 70% of the lowest closing bid price of the Company's common stock for the ten consecutive trading day period prior to the conversion date. If certain defined triggering events occur, the conversion price would thereafter be reduced (and only reduced), to equal 60% of the lower of (i) the lowest closing bid price of the Company's common stock for the thirty consecutive trading day period prior to the conversion date or (ii) the lowest VWAP of the the Company's common stock for the thirty consecutive trading day period prior to the conversion date. In addition, on the 90th day and also on the 180th day from the date of the Note SPA, the private investor may reset the Fixed Conversion Price to thereafter be equal to the VWAP of the Common Stock for such day or if such 90th or 180th day is not a trading day, then the VWAP for the immediately preceding trading day. The following table summarizes the conversion activity on the principal of the July 2106 Convertible Notes: Conversion Period Principal Converted Common Shares Issued Q4 2016 $ 152,460 64,000,000 Q1 2017 1,017,732 959,704,543 Q2 2017 682,235 1,865,043,998 $ 1,852,427 2,888,748,541 In addition to the $1,852,427 in principal conversions, $3,960 of interest was converted during 2017. As of December 31, 2017 , with $1,096,600 of principal payments, $400,017 of interest payments, and $219,320 of redemption penalty payments, the July 2016 Convertible notes had been redeemed in full. The difference in the accrued interest and the paid interest, due to the terms of the settlement agreement, was $22,661 which was credited to interest expense upon full redemption of the instrument. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the July 2016 Convertible Notes was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At December 31, 2016 the fair value of the derivative liability was $3,733,348 . Throughout 2017, the Company recorded the fair value changes of the embedded derivative associated with the July 2016 Convertible Notes as a gain or loss in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $3,733,348 , to properly reflect the elimination of the embedded derivative upon the extinguishment of the liability. OCTOBER 2016 CONVERTIBLE NOTES AND EXCHANGE OF SERIES A PREFERRED STOCK October 2016 Convertible Notes On October 5, 2016 , the Company entered into a securities purchase agreement with a private investor (“Adar Bays”) for the private placement of $330,000 principal amount of October 2016 Convertible Notes. At Closing, the Company sold and issued $330,000 principal amount of October 2016 Convertible Notes to Adar Bays in exchange for $300,000 of gross proceeds. Unless earlier converted or prepaid, the October 2016 Convertible Notes will mature December 31, 2017 (the “Maturity Date”). The October 2016 Convertible Notes bear interest at a rate of 6% per annum, subject to increase to 24% per annum upon the occurrence and continuance of an event of default (as described below). Principal and accrued interest on the October 2016 Convertible Notes is payable on the Maturity Date. All principal and accrued interest on the October 2016 Convertible Notes are convertible at any time, in whole or in part, at the option of Adar Bays, into shares of common stock at a variable conversion price equal to 80% of the lowest closing bid price of the Company’s common stock for the 15 consecutive trading day period prior to the conversion date. After the six month anniversary of the issuance of any October 2016 Convertible Note, the conversion price for such note shall thereafter be equal to 50% of the lowest closing bid price of the Company’s common stock for the 15 consecutive trading day period prior to the conversion date. The October 2016 Convertible Notes contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the October 2016 Convertible Notes; and (ii) bankruptcy or insolvency of the Company. Outstanding principal and accrued interest on the October 2016 Convertible Notes were $330,000 and $24,860 , respectively as of December 31, 2017 . Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the October 2016 Convertible Notes were deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At closing, a derivative liability and a corresponding debt discount in the amount of $330,000 was recorded. The fair value of the derivative was greater than the face value at issuance and the difference of $341,114 was charged to interest expense at issuance. The remaining debt discount will be charged to interest expense ratably over the life of the October 2016 Convertible Notes. As of December 31, 2016 , the fair value of the derivative liability was $544,746 . The derivative liability associated with the October 2016 Convertible Notes is subject to revaluation on a quarterly basis to reflect the market value change of the embedded conversion option. At December 31, 2017 , the Company conducted a fair value assessment of the embedded derivative associated with the October 2016 Convertible Notes. As a result of the fair value assessment, the Company recorded a $279,442 loss as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations for the three months ended December 31, 2017 . The net loss recorded for the year ended December 31, 2017 was $27,897 , to properly reflect the fair value of the embedded derivative of $572,643 as of December 31, 2017 . The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The derivative associated with the October 2016 Convertible Notes approximates management’s estimate of the fair value of the embedded derivative liability at December 31, 2017 based on using a Monte Carlo simulation following a Geometric Brownian Motion with the following assumptions: annual volatility of 65% present value discount rate of 12% and dividend yield of 0% . Exchange of Outstanding Series A Preferred Stock for Convertible Notes In 2013, the Company completed private placement to one accredited investor (the “Series A Holder”) of its Series A Convertible Preferred Stock. Prior to the exchange agreement described below the Company had $165,541 shares of Series A Preferred Stock that remained outstanding as of October 6, 2016 . On October 6, 2016 , the Series A Holder entered into an exchange agreement (the “Exchange Agreement”) with Adar Bays. Pursuant to the exchange agreement, beginning December 5, 2016, Adar Bays has the option to exchange, from time to time, all or any portion of the October 2016 Convertible Notes for outstanding shares of Series A Preferred Stock from the Series A Holder. As of March 31, 2017, Adar Bays had elected to exchange all outstanding October 2016 Convertible Notes, in accordance with the exchange agreement, and the Series A Holder held $330,000 of the October 2016 Convertible Notes. SERIES A PREFERRED STOCK In June 2013, the Company entered into a Securities Purchase Agreement with an investor to sell an aggregate of 750,000 shares of Series A Preferred Stock at a price of $8 per share, resulting in gross proceeds of $6,000,000 . This purchase agreement included warrants to purchase up to 13,125 shares of common stock of the Company. The transfer of cash and securities took place incrementally, the first closing occurring on June 17, 2013 with the transfer of 125,000 shares of Series A Preferred Stock and a warrant to purchase 2,187 shares of common stock for $1,000,000 . The final closings took place in August 2013, with the transfer of 625,000 shares of Series A Preferred Stock and a warrant to purchase 10,938 shares of common stock for $5,000,000 . Holders of Series A Preferred Stock are entitled to cumulative dividends at a rate of 8% per annum when and if declared by the Board of Directors in its sole discretion. The dividends may be paid in cash or in the form of common stock (valued at 10% below market price, but not to exceed the lowest closing price during the applicable measurement period), at the discretion of the Board of Directors. The dividend rate on the Series A Preferred Stock is indexed to the Company's stock price and subject to adjustment. In addition, the Series A Preferred Stock contains a make-whole provision whereby, conversion or redemption of the preferred stock within 4 years of issuance will require dividends for the full four year period to be paid by the Company in cash or common stock (valued at 10% below market price, but not to exceed the lowest closing price during the applicable measurement period). This make-whole provision expired in June 2017 and future conversions and redemptions will be paid out with accrued dividends per the holding period of the shares of Series A Preferred stock. Please see Note 23 for more information. The Series A Preferred Stock may be converted into shares of common stock at the option of the Company if the closing price of the common stock exceeds $232 , as adjusted, for 20 consecutive trading days, or by the holder at any time. The Company has the right to redeem the Series A Preferred Stock at a price of $8 per share, plus any accrued and unpaid dividends, plus the make-whole amount (if applicable). At December 31, 2017 , the preferred shares were not eligible for conversion to common shares at the option of the Company. The holder of the preferred shares may convert to common shares at any time, at no cost, at a ratio of 1 preferred share into 1 common share (subject to standard ratable anti-dilution adjustments). Upon any conversion (whether at the option of the Company or the holder), the holder is entitled to receive any accrued but unpaid dividends. On October 6, 2016, the Series A Holder entered into an exchange agreement (the “Exchange Agreement”) with Adar Bays. Pursuant to the exchange agreement, beginning December 5, 2016, Adar Bays has the option to exchange, from time to time, all or any portion of the October 2016 Convertible Notes (see Note 13) for outstanding shares of Series A Preferred Stock from the Series A Holder. As of December 31, 2017 , Adar Bays had elected to exchange all outstanding October 2016 Convertible Notes, in accordance with the exchange agreement, resulting in the exchange of 104,785 shares of Series A Preferred Stock. As of December 31, 2017 , Adar Bays had also converted their 104,785 shares of Series A Preferred Stock, and the related make whole dividend, which resulted in the issuance of 173,946,250 shares of common stock. Except as otherwise required by law (or with respect to approval of certain actions), the Series A Preferred Stock shall have no voting rights. Upon any liquidation, dissolution or winding up of the Company, after payment or provision for payment of debts and other liabilities of the Company, the holders of Series A Preferred Stock shall be entitled to receive, pari passu with any distribution to the holders of common stock of the Company, an amount equal to $8 per share of Series A Preferred Stock plus any accrued and unpaid dividends. As of December 31, 2017 , there were 60,756 shares of Series A Preferred Stock outstanding and accrued and unpaid dividends of $279,815 . SERIES E PREFERRED STOCK AND THE COMMITTED EQUITY LINE Series E Preferred Stock On November 4, 2015 , the Company entered into a securities purchase agreement with a private investor to issue 2,800 shares of Series E Preferred Stock in exchange for $2,800,000 . Shares of the Series E Preferred Stock (including the amount of any accrued and unpaid dividends thereon) are convertible, at the option of the holder, into common stock at a variable conversion price equal to 80% of the average of the two lowest VWAPs of the Company's common stock for the ten consecutive trading day period prior to the conversion date. If certain defined default events occur, the conversion price would thereafter be reduced (and only reduced), to equal 70% of the average of the two lowest VWAPs of the Company's common stock for the twenty consecutive trading day period prior to the conversion date. The private investor had available to them a new conversion price beginning on June 9, 2016 as a result of the Series H Preferred Stock transaction further described in Note 12. Shares of the Series E Preferred Stock are now convertible, at the option of the private investor, into common stock at a variable conversion price equal to 70% of (i) the lowest VWAP of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. The following table summarizes the conversion activity of the Series E Preferred Stock: Conversion Period Preferred Series E Shares Converted Value of Series E Preferred Shares (inclusive of accrued dividends) Common Shares Issued Q4 2015 478 $ 481,500 250,000 Q1 2016 1,220 1,239,436 1,132,000 Q2 2016 365 381,414 7,979,568 Q3 2016 523 548,896 21,973,747 Q4 2016 94 101,018 13,089,675 Q1 2017 15 16,248 8,289,962 Q2 2017 35 38,886 134,927,207 Q3 2017 70 76,814 129,314,677 2,800 $ 2,884,212 316,956,836 Holders of the Series E Preferred Stock will be entitled to dividends in the amount of 7% per annum. During the year ended December 31, 2017 , the holder converted dividends in the amount of $11,948 on the Series E Preferred Stock, resulting in the issuance of 25,160,171 shares of common stock. On September 30, 2017, the Company paid $2,013 in cash for the remaining accrued dividends. The Company has issued 18,000 shares of common stock to the private investor as a commitment fee relating to the Series E Preferred Stock. Costs associated with the Series E Preferred Stock, such as legal fees and commitment shares are capitalized and reported as deferred financing costs on the Condensed Consolidated Balance Sheets. The total gross debt issuance cost incurred by the Company related to the Series E Preferred Stock was $104,000 . These debt issuance costs will be recognized as additional interest expense over the life of the Series E Preferred Stock. As of December 31, 2017 , all outstanding shares of Series E Preferred Stock, along with all accrued dividends, had either been converted or redeemed. The Company classified the Series E Preferred Stock as a liability pursuant to ASC 480 on the closing date due to the structure of the financing agreement, whereby the Company has an unconditional obligation that the Company may settle by issuing a variable number of common shares with a monetary value that is fixed and known at inception. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Series E Preferred Stock was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At December 31, 2016 the fair value of the derivative liability was $140,748 . At September 30, 2017, the Company recorded the reduction of the remaining embedded derivative associated with the Series E Preferred Stock of $121,390 as a gain in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $140,748 , to properly reflect the elimination of the embedded derivative as of December 31, 2017 . The Committed Equity Line On November 10, 2015, the Company and the private investor entered into a committed equity line purchase agreement (the "CEL"). Under the terms and subject to the conditions of the CEL purchase agreement, at its option the Company has the right to sell to the private investor, and the private investor is obligated to purchase from the Company, up to $32.2 million of the Company’s common stock, subject to certain limitations, from time to time, over the 36 -month period commencing on December 18, 2015, the date that the registration statement was declared effective by the SEC. From time to time, the Company may direct the private investor, at its sole discretion and subject to certain conditions, to purchase an amount of shares of common stock up to the lesser of (i) $1,000,000 or (ii) 300% of the average daily trading volume of the Company’s common stock over the preceding ten trading day period. The per share purchase price for shares of common stock to be sold by the Company under the CEL purchase agreement shall be equal to 80% of the average of the two lowest VWAPs of the common stock for the ten consecutive trading day period prior to the purchase date. In total, the Company directed the private investor to purchase $3,056,147 of common stock which resulted in the issuance of 1,368,000 shares of common stock. The Company may not direct the private investor to purchase shares of common stock more frequently than once each ten business days. The Company’s sales of shares of common stock to the private investor under the CEL purchase agreement are limited to no more than the number of shares that would result in the beneficial ownership by the private investor and its affiliates, at any single point in time, of more than 9.99% of the Company’s then outstanding shares of common stock. As consideration for entering into the CEL purchase agreement, the Company agreed to issue to the private investor 132,000 shares of common stock (the “Commitment Shares”). The Commitment Shares were issued to the private investor commencing upon the date that the registration statement was declared effective by the SEC. While not officially terminated, the CEL is no longer active and the Company does not consider this a viable source of capital. SERIES F PREFERRED STOCK On January 19, 2016 , the Company entered into a securities purchase agreement with a private investor for the sale of $7,000,000 of the Company’s newly designated Series F Preferred Stock. On January 20, 2016 , the Company sold and issued 7,000 shares of Series F Preferred Stock to the private investor. The aggregate purchase price of the Series F Preferred shares was $7,000,000 . On January 20, 2016 , the private investor paid $500,000 to the Company. The remaining $6,500,000 was paid by the private investor to the Company in 14 weekly increments of $500,000 or $250,000 beginning January 25, 2016 and ending April 28, 2016 . Shares of the Series F Preferred Stock (including the amount of any accrued and unpaid dividends thereon) are convertible, at the option of the holder, into common stock at a fixed conversion price equal to $5 per share. If certain defined default events occur, the conversion price would thereafter be reduced (and only reduced), to equal 70% of the average of the two lowest VWAPs of our common stock for the twenty consecutive trading day period prior to the conversion date. If requested by the private investor, the Company will make weekly redemptions of shares of Series F Preferred Stock (including any accrued and unpaid dividends thereon). If the redemption price is paid by the Company in cash, the number of shares to be redeemed in each weekly increment is 250 shares of Series F Preferred Stock, and the redemption price is a price per share equal to $1,250 plus any accrued but unpaid dividends thereon. The Company has the option to make such redemption payments in shares of common stock provided certain specified equity conditions are satisfied at the time of payment. The number of shares of common stock to be issued would be calculated using a per share price equal to 80% of the one lowest VWAP of our common stock for the ten consecutive trading day period prior to the payment date. For redemption payments made in shares of common stock, the Company will redeem either (i) 250 shares of Series F Preferred Stock or (ii) such greater number of shares of Series F Preferred Stock (and also including any accrued and unpaid dividends) that would result upon redemption in the issuance of a number of shares of common stock equal to 12% of the aggregate composite trading volume for the Company’s common stock during the preceding calendar week. The private investor had available to them a new conversion price beginning on June 9, 2016 as a result of the Series H Preferred Stock transaction further described in Note 12. Shares of the Series F Preferred Stock are now convertible, at the option of the private investor, into common stock at a variable conversion price equal to 70% of (i) the lowest VWAP of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. Amendment of Outstanding Series F Preferred Stock Conversion Price On October 5, 2016 , the Company filed a Certificate of Amendment to the Certificate of Designations of Preferences, Rights and Limitations of Series F Preferred Stock with the Secretary of State of the State of Delaware. The Certificate of Amendment amends the conversion price at which the Series F Preferred Stock can be converted into shares of common stock. The Company had approximately $336,000 of Series F Preferred Stock remaining outstanding as of October 5, 2016 . As amended, the conversion price will now be equal to the lowest of (i) 50% of the lowest weighted average price (“VWAP”) of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) 50% of the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. If certain “Triggering Events” specified in the terms of the Series F Preferred Stock occur, then the conversion price of the Series F Preferred Stock shall be thereafter reduced, and only reduced, to equal 50% of the average of the lowest traded price of the common stock for the twenty consecutive trading day period prior to the conversion date. The following table summarizes the conversion activity of the Series F Preferred Stock: Conversion Period Principal Converted Dividends Converted Common Shares Issued Q1 2016 $ 2,168,402 $ 19,896 2,183,991 Q2 2016 $ 3,234,000 $ 66,931 6,649,741 Q3 2016 $ 1,261,648 $ 54,096 81,917,367 Q4 2016 $ 175,949 $ 9,168 27,276,006 Q3 2017 $ 20,000 $ — 18,181,818 Q4 2017 $ 107,000 $ 467 172,552,354 $ 6,966,999 $ 150,558 308,761,277 Holders of the Series F Preferred Stock are entitled to dividends in the amount of 7% per annum. As of December 31, 2017 , all shares and accrued dividends had been converted and no balance remained. The Company classified the Series F Preferred Stock as a liability pursuant to ASC 480 on the closing date due to the structure of the financing agreement, whereby the Company has an unconditional obligation that the Company may settle by issuing a variable number of common shares with a monetary value that is fixed and known at inception. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Series F Preferred Stock was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At closing, a derivative liability and a corresponding debt discount in the amount of $1,666,000 were recorded. The debt discount will be charged to interest expense ratably over the life of the Series F Preferred Stock. The derivative balance was $255,324 , as of December 31, 2016 . At December 31, 2017 , the Company recorded the reduction of the remaining embedded derivative associated with the Series F Preferred Stock of $42,347 as a gain in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $255,324 , to properly reflect the elimination of the embedded derivative as of December 31, 2017 . SERIES G PREFERRED STOCK On April 29, 2016 , the Company entered into a securities purchase agreement with private investors to issue 2,000 shares of Series G Preferred Stock for $2,000,000 . The Company issued 2,000 shares of Series G Preferred Stock to the private investors, in various tranches between April and June 2016, resulting in gross proceeds to the Company of $2,000,000 . Holders of the Series G Preferred Stock are entitled to dividends in the amount of 10% per annum. One year after issuance, the Company is required to redeem for cash all or any portion of the outstanding shares of the Series G Preferred Stock at a price per share equal to $1,000 plus any accrued but unpaid dividends thereon. Assignment of Series G Preferred Stock Beginning September 19, 2016 , the two private investors (the “Series G Sellers”) entered into assignment agreements with accredited investors (the “Series G Purchasers”). Under the terms of the assignment agreements, the Series G Sellers may sell all 2,000 outstanding shares of Series G Preferred Stock to the Series G Purchasers for a purchase price of $1,000 per share of Series G Preferred Stock (plus the amount of any accrued and unpaid dividends thereon). During 2016 and 2017, the Series G Sellers had sold 1,795 shares of Series G Preferred Stock, representing a value of $1,795,000 , to the Series G Purchasers. On September 21, 2016 , the Company filed a Certificate of Amendment to the Certificate of Designations of Prefe |
Series G Preferred Stock
Series G Preferred Stock | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Preferred Stock | SERIES H PREFERRED STOCK AND JULY 2016 CONVERTIBLE NOTES Series H Preferred Stock On June 9, 2016 , the Company entered into a securities purchase agreement with a private investor to issue 2,500 shares of Series H Preferred Stock for $2,500,000 . The Company received gross proceeds of $250,000 at Closing. Additional gross proceeds of $580,000 were received by the Company through July 7, 2016. The Company agreed to exchange outstanding Series H Preferred Stock for Senior Secured Convertible Notes (“July 2016 Notes”) on July 13, 2016 . At the date of the exchange, the Company had sold and issued 830 shares of Series H Preferred Stock to the private investor in exchange for $830,000 of gross proceeds. Please see the section below for details of the exchange. July 2016 Convertible Notes On July 13, 2016 , the Company entered into a securities purchase agreement (the “Note SPA”) with the private investor for the private placement of $2,082,600 of the Company’s 4% Original Issue Discount Senior Secured Convertible Promissory Notes (the “July 2016 Convertible Notes”). On July 13, 2016 , the Company sold and issued $364,000 principal amount of notes to the investor in exchange for $350,000 of gross proceeds. The Company sold and issued the remaining $1,718,600 principal amount of July 2016 Convertible Notes to the investor in exchange for $1,650,000 of gross proceeds in weekly tranches between July and September 2016. The Company and the private investor also entered into an Exchange Agreement dated July 13, 2016 (the “Exchange Agreement”). Under the terms of the Exchange Agreement, the outstanding shares of Series H Preferred Stock (approximately $833,000 of capital and accrued dividends) were canceled. In exchange, the Company issued to the private investor approximately $866,000 of July 2016 Convertible Notes. There were 830 shares of Series H Preferred Stock outstanding as of the date of the Exchange Agreement. Unless earlier converted or prepaid, all of the July 2016 Convertible Notes will mature July 13, 2017 . The July 2016 Convertible Notes bear interest at a rate of 10% per annum, subject to increase to 24% per annum upon the occurrence and continuance of an event of default. Principal on the July 2016 Convertible Notes is payable on the Maturity Date. Interest on the July 2016 Convertible Notes is payable quarterly. Principal and interest are payable in cash or, if specified equity conditions are met, shares of Common Stock. The July 2016 Convertible Notes are secured by a security interest in substantially all of the Company’s assets. The subsidiaries of the Company have guaranteed the Company’s obligations under the July 2016 Convertible Notes. The July 2016 Convertible Notes contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the July 2016 Convertible Notes; (ii) bankruptcy or insolvency of the Company; and (iii) failure to file a registration statement by October 9, 2016. On October 10, 2016 the Company had not been successful in filing the registration statement triggering an event of default per the July 2016 Note Agreement. Upon default the interest rate increases to 24% per annum and the holder of the July 2016 Notes has the option to accelerate the Note and demand cash payment of the Mandatory Default Amount consisting of a 25% premium of the principal balance plus any accrued and unpaid interest. The Company began accruing interest at the rate of 24% on October 10, 2016. Forbearance and Settlement Agreement on July 2016 Convertible Notes On May 5, 2017 , the Company entered into a Forbearance and Settlement Agreement ("Forbearance Agreement") with a holder of certain secured convertible notes that are in default due to various triggering events. The holder and the Company agreed to forbear from taking any action provided for under the secured convertible notes in exchange for the following terms provided in this agreement: • The Company agreed to redeem for cash all secured convertible notes of the Company held by the holder no later than September 1, 2017 . • The Company affirmed that the current balance of owed principal and accrued and unpaid interest to the holder is $1,790,214 as of May 2, 2017 . • The redemption price for such secured convertible notes shall be 120% (if redeemed on or prior to August 15, 2017 ) or 125% (if redeemed after August 15, 2017 ) of the then outstanding principal, plus any accrued and unpaid interest. • During the month of May 2017, the Holder agreed to limit its conversions of outstanding Company secured convertible notes to $50,000 per calendar week of principal/interest. • During the months of June, July and August 2017, the holder agreed to limit its conversions of outstanding Company secured convertible notes to $75,000 per calendar week of principal/interest. • During the months of May, June, July and August 2017, the holder agreed that all outstanding Company secured convertible notes shall bear interest at the normal stated rate of 10% , rather than default rate of 24% . • All conversions during the months of May, June, July and August 2017 will be at the “triggering event” discount conversion price as stated in the secured convertible notes, and will continue at the “triggering event” discount price until, if and when the notes are redeemed. • Should the Company fail to redeem for cash all secured convertible notes on or before September 1, 2017 , default interest and normal stated interest will accrue from the date of execution of this agreement. All principal and accrued interest on the July 2016 Convertible Notes are convertible at any time, in whole or in part, at the option of the private investor, into shares of Common Stock at a variable conversion price equal to the lowest of (i) $0.045 (the “Fixed Conversion Price”), (ii) 70% of the lowest volume weighted average price (“VWAP”) of the Company's common stock for the ten consecutive trading day period prior to the conversion date or (iii) 70% of the lowest closing bid price of the Company's common stock for the ten consecutive trading day period prior to the conversion date. If certain defined triggering events occur, the conversion price would thereafter be reduced (and only reduced), to equal 60% of the lower of (i) the lowest closing bid price of the Company's common stock for the thirty consecutive trading day period prior to the conversion date or (ii) the lowest VWAP of the the Company's common stock for the thirty consecutive trading day period prior to the conversion date. In addition, on the 90th day and also on the 180th day from the date of the Note SPA, the private investor may reset the Fixed Conversion Price to thereafter be equal to the VWAP of the Common Stock for such day or if such 90th or 180th day is not a trading day, then the VWAP for the immediately preceding trading day. The following table summarizes the conversion activity on the principal of the July 2106 Convertible Notes: Conversion Period Principal Converted Common Shares Issued Q4 2016 $ 152,460 64,000,000 Q1 2017 1,017,732 959,704,543 Q2 2017 682,235 1,865,043,998 $ 1,852,427 2,888,748,541 In addition to the $1,852,427 in principal conversions, $3,960 of interest was converted during 2017. As of December 31, 2017 , with $1,096,600 of principal payments, $400,017 of interest payments, and $219,320 of redemption penalty payments, the July 2016 Convertible notes had been redeemed in full. The difference in the accrued interest and the paid interest, due to the terms of the settlement agreement, was $22,661 which was credited to interest expense upon full redemption of the instrument. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the July 2016 Convertible Notes was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At December 31, 2016 the fair value of the derivative liability was $3,733,348 . Throughout 2017, the Company recorded the fair value changes of the embedded derivative associated with the July 2016 Convertible Notes as a gain or loss in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $3,733,348 , to properly reflect the elimination of the embedded derivative upon the extinguishment of the liability. OCTOBER 2016 CONVERTIBLE NOTES AND EXCHANGE OF SERIES A PREFERRED STOCK October 2016 Convertible Notes On October 5, 2016 , the Company entered into a securities purchase agreement with a private investor (“Adar Bays”) for the private placement of $330,000 principal amount of October 2016 Convertible Notes. At Closing, the Company sold and issued $330,000 principal amount of October 2016 Convertible Notes to Adar Bays in exchange for $300,000 of gross proceeds. Unless earlier converted or prepaid, the October 2016 Convertible Notes will mature December 31, 2017 (the “Maturity Date”). The October 2016 Convertible Notes bear interest at a rate of 6% per annum, subject to increase to 24% per annum upon the occurrence and continuance of an event of default (as described below). Principal and accrued interest on the October 2016 Convertible Notes is payable on the Maturity Date. All principal and accrued interest on the October 2016 Convertible Notes are convertible at any time, in whole or in part, at the option of Adar Bays, into shares of common stock at a variable conversion price equal to 80% of the lowest closing bid price of the Company’s common stock for the 15 consecutive trading day period prior to the conversion date. After the six month anniversary of the issuance of any October 2016 Convertible Note, the conversion price for such note shall thereafter be equal to 50% of the lowest closing bid price of the Company’s common stock for the 15 consecutive trading day period prior to the conversion date. The October 2016 Convertible Notes contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the October 2016 Convertible Notes; and (ii) bankruptcy or insolvency of the Company. Outstanding principal and accrued interest on the October 2016 Convertible Notes were $330,000 and $24,860 , respectively as of December 31, 2017 . Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the October 2016 Convertible Notes were deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At closing, a derivative liability and a corresponding debt discount in the amount of $330,000 was recorded. The fair value of the derivative was greater than the face value at issuance and the difference of $341,114 was charged to interest expense at issuance. The remaining debt discount will be charged to interest expense ratably over the life of the October 2016 Convertible Notes. As of December 31, 2016 , the fair value of the derivative liability was $544,746 . The derivative liability associated with the October 2016 Convertible Notes is subject to revaluation on a quarterly basis to reflect the market value change of the embedded conversion option. At December 31, 2017 , the Company conducted a fair value assessment of the embedded derivative associated with the October 2016 Convertible Notes. As a result of the fair value assessment, the Company recorded a $279,442 loss as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations for the three months ended December 31, 2017 . The net loss recorded for the year ended December 31, 2017 was $27,897 , to properly reflect the fair value of the embedded derivative of $572,643 as of December 31, 2017 . The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The derivative associated with the October 2016 Convertible Notes approximates management’s estimate of the fair value of the embedded derivative liability at December 31, 2017 based on using a Monte Carlo simulation following a Geometric Brownian Motion with the following assumptions: annual volatility of 65% present value discount rate of 12% and dividend yield of 0% . Exchange of Outstanding Series A Preferred Stock for Convertible Notes In 2013, the Company completed private placement to one accredited investor (the “Series A Holder”) of its Series A Convertible Preferred Stock. Prior to the exchange agreement described below the Company had $165,541 shares of Series A Preferred Stock that remained outstanding as of October 6, 2016 . On October 6, 2016 , the Series A Holder entered into an exchange agreement (the “Exchange Agreement”) with Adar Bays. Pursuant to the exchange agreement, beginning December 5, 2016, Adar Bays has the option to exchange, from time to time, all or any portion of the October 2016 Convertible Notes for outstanding shares of Series A Preferred Stock from the Series A Holder. As of March 31, 2017, Adar Bays had elected to exchange all outstanding October 2016 Convertible Notes, in accordance with the exchange agreement, and the Series A Holder held $330,000 of the October 2016 Convertible Notes. SERIES A PREFERRED STOCK In June 2013, the Company entered into a Securities Purchase Agreement with an investor to sell an aggregate of 750,000 shares of Series A Preferred Stock at a price of $8 per share, resulting in gross proceeds of $6,000,000 . This purchase agreement included warrants to purchase up to 13,125 shares of common stock of the Company. The transfer of cash and securities took place incrementally, the first closing occurring on June 17, 2013 with the transfer of 125,000 shares of Series A Preferred Stock and a warrant to purchase 2,187 shares of common stock for $1,000,000 . The final closings took place in August 2013, with the transfer of 625,000 shares of Series A Preferred Stock and a warrant to purchase 10,938 shares of common stock for $5,000,000 . Holders of Series A Preferred Stock are entitled to cumulative dividends at a rate of 8% per annum when and if declared by the Board of Directors in its sole discretion. The dividends may be paid in cash or in the form of common stock (valued at 10% below market price, but not to exceed the lowest closing price during the applicable measurement period), at the discretion of the Board of Directors. The dividend rate on the Series A Preferred Stock is indexed to the Company's stock price and subject to adjustment. In addition, the Series A Preferred Stock contains a make-whole provision whereby, conversion or redemption of the preferred stock within 4 years of issuance will require dividends for the full four year period to be paid by the Company in cash or common stock (valued at 10% below market price, but not to exceed the lowest closing price during the applicable measurement period). This make-whole provision expired in June 2017 and future conversions and redemptions will be paid out with accrued dividends per the holding period of the shares of Series A Preferred stock. Please see Note 23 for more information. The Series A Preferred Stock may be converted into shares of common stock at the option of the Company if the closing price of the common stock exceeds $232 , as adjusted, for 20 consecutive trading days, or by the holder at any time. The Company has the right to redeem the Series A Preferred Stock at a price of $8 per share, plus any accrued and unpaid dividends, plus the make-whole amount (if applicable). At December 31, 2017 , the preferred shares were not eligible for conversion to common shares at the option of the Company. The holder of the preferred shares may convert to common shares at any time, at no cost, at a ratio of 1 preferred share into 1 common share (subject to standard ratable anti-dilution adjustments). Upon any conversion (whether at the option of the Company or the holder), the holder is entitled to receive any accrued but unpaid dividends. On October 6, 2016, the Series A Holder entered into an exchange agreement (the “Exchange Agreement”) with Adar Bays. Pursuant to the exchange agreement, beginning December 5, 2016, Adar Bays has the option to exchange, from time to time, all or any portion of the October 2016 Convertible Notes (see Note 13) for outstanding shares of Series A Preferred Stock from the Series A Holder. As of December 31, 2017 , Adar Bays had elected to exchange all outstanding October 2016 Convertible Notes, in accordance with the exchange agreement, resulting in the exchange of 104,785 shares of Series A Preferred Stock. As of December 31, 2017 , Adar Bays had also converted their 104,785 shares of Series A Preferred Stock, and the related make whole dividend, which resulted in the issuance of 173,946,250 shares of common stock. Except as otherwise required by law (or with respect to approval of certain actions), the Series A Preferred Stock shall have no voting rights. Upon any liquidation, dissolution or winding up of the Company, after payment or provision for payment of debts and other liabilities of the Company, the holders of Series A Preferred Stock shall be entitled to receive, pari passu with any distribution to the holders of common stock of the Company, an amount equal to $8 per share of Series A Preferred Stock plus any accrued and unpaid dividends. As of December 31, 2017 , there were 60,756 shares of Series A Preferred Stock outstanding and accrued and unpaid dividends of $279,815 . SERIES E PREFERRED STOCK AND THE COMMITTED EQUITY LINE Series E Preferred Stock On November 4, 2015 , the Company entered into a securities purchase agreement with a private investor to issue 2,800 shares of Series E Preferred Stock in exchange for $2,800,000 . Shares of the Series E Preferred Stock (including the amount of any accrued and unpaid dividends thereon) are convertible, at the option of the holder, into common stock at a variable conversion price equal to 80% of the average of the two lowest VWAPs of the Company's common stock for the ten consecutive trading day period prior to the conversion date. If certain defined default events occur, the conversion price would thereafter be reduced (and only reduced), to equal 70% of the average of the two lowest VWAPs of the Company's common stock for the twenty consecutive trading day period prior to the conversion date. The private investor had available to them a new conversion price beginning on June 9, 2016 as a result of the Series H Preferred Stock transaction further described in Note 12. Shares of the Series E Preferred Stock are now convertible, at the option of the private investor, into common stock at a variable conversion price equal to 70% of (i) the lowest VWAP of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. The following table summarizes the conversion activity of the Series E Preferred Stock: Conversion Period Preferred Series E Shares Converted Value of Series E Preferred Shares (inclusive of accrued dividends) Common Shares Issued Q4 2015 478 $ 481,500 250,000 Q1 2016 1,220 1,239,436 1,132,000 Q2 2016 365 381,414 7,979,568 Q3 2016 523 548,896 21,973,747 Q4 2016 94 101,018 13,089,675 Q1 2017 15 16,248 8,289,962 Q2 2017 35 38,886 134,927,207 Q3 2017 70 76,814 129,314,677 2,800 $ 2,884,212 316,956,836 Holders of the Series E Preferred Stock will be entitled to dividends in the amount of 7% per annum. During the year ended December 31, 2017 , the holder converted dividends in the amount of $11,948 on the Series E Preferred Stock, resulting in the issuance of 25,160,171 shares of common stock. On September 30, 2017, the Company paid $2,013 in cash for the remaining accrued dividends. The Company has issued 18,000 shares of common stock to the private investor as a commitment fee relating to the Series E Preferred Stock. Costs associated with the Series E Preferred Stock, such as legal fees and commitment shares are capitalized and reported as deferred financing costs on the Condensed Consolidated Balance Sheets. The total gross debt issuance cost incurred by the Company related to the Series E Preferred Stock was $104,000 . These debt issuance costs will be recognized as additional interest expense over the life of the Series E Preferred Stock. As of December 31, 2017 , all outstanding shares of Series E Preferred Stock, along with all accrued dividends, had either been converted or redeemed. The Company classified the Series E Preferred Stock as a liability pursuant to ASC 480 on the closing date due to the structure of the financing agreement, whereby the Company has an unconditional obligation that the Company may settle by issuing a variable number of common shares with a monetary value that is fixed and known at inception. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Series E Preferred Stock was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At December 31, 2016 the fair value of the derivative liability was $140,748 . At September 30, 2017, the Company recorded the reduction of the remaining embedded derivative associated with the Series E Preferred Stock of $121,390 as a gain in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $140,748 , to properly reflect the elimination of the embedded derivative as of December 31, 2017 . The Committed Equity Line On November 10, 2015, the Company and the private investor entered into a committed equity line purchase agreement (the "CEL"). Under the terms and subject to the conditions of the CEL purchase agreement, at its option the Company has the right to sell to the private investor, and the private investor is obligated to purchase from the Company, up to $32.2 million of the Company’s common stock, subject to certain limitations, from time to time, over the 36 -month period commencing on December 18, 2015, the date that the registration statement was declared effective by the SEC. From time to time, the Company may direct the private investor, at its sole discretion and subject to certain conditions, to purchase an amount of shares of common stock up to the lesser of (i) $1,000,000 or (ii) 300% of the average daily trading volume of the Company’s common stock over the preceding ten trading day period. The per share purchase price for shares of common stock to be sold by the Company under the CEL purchase agreement shall be equal to 80% of the average of the two lowest VWAPs of the common stock for the ten consecutive trading day period prior to the purchase date. In total, the Company directed the private investor to purchase $3,056,147 of common stock which resulted in the issuance of 1,368,000 shares of common stock. The Company may not direct the private investor to purchase shares of common stock more frequently than once each ten business days. The Company’s sales of shares of common stock to the private investor under the CEL purchase agreement are limited to no more than the number of shares that would result in the beneficial ownership by the private investor and its affiliates, at any single point in time, of more than 9.99% of the Company’s then outstanding shares of common stock. As consideration for entering into the CEL purchase agreement, the Company agreed to issue to the private investor 132,000 shares of common stock (the “Commitment Shares”). The Commitment Shares were issued to the private investor commencing upon the date that the registration statement was declared effective by the SEC. While not officially terminated, the CEL is no longer active and the Company does not consider this a viable source of capital. SERIES F PREFERRED STOCK On January 19, 2016 , the Company entered into a securities purchase agreement with a private investor for the sale of $7,000,000 of the Company’s newly designated Series F Preferred Stock. On January 20, 2016 , the Company sold and issued 7,000 shares of Series F Preferred Stock to the private investor. The aggregate purchase price of the Series F Preferred shares was $7,000,000 . On January 20, 2016 , the private investor paid $500,000 to the Company. The remaining $6,500,000 was paid by the private investor to the Company in 14 weekly increments of $500,000 or $250,000 beginning January 25, 2016 and ending April 28, 2016 . Shares of the Series F Preferred Stock (including the amount of any accrued and unpaid dividends thereon) are convertible, at the option of the holder, into common stock at a fixed conversion price equal to $5 per share. If certain defined default events occur, the conversion price would thereafter be reduced (and only reduced), to equal 70% of the average of the two lowest VWAPs of our common stock for the twenty consecutive trading day period prior to the conversion date. If requested by the private investor, the Company will make weekly redemptions of shares of Series F Preferred Stock (including any accrued and unpaid dividends thereon). If the redemption price is paid by the Company in cash, the number of shares to be redeemed in each weekly increment is 250 shares of Series F Preferred Stock, and the redemption price is a price per share equal to $1,250 plus any accrued but unpaid dividends thereon. The Company has the option to make such redemption payments in shares of common stock provided certain specified equity conditions are satisfied at the time of payment. The number of shares of common stock to be issued would be calculated using a per share price equal to 80% of the one lowest VWAP of our common stock for the ten consecutive trading day period prior to the payment date. For redemption payments made in shares of common stock, the Company will redeem either (i) 250 shares of Series F Preferred Stock or (ii) such greater number of shares of Series F Preferred Stock (and also including any accrued and unpaid dividends) that would result upon redemption in the issuance of a number of shares of common stock equal to 12% of the aggregate composite trading volume for the Company’s common stock during the preceding calendar week. The private investor had available to them a new conversion price beginning on June 9, 2016 as a result of the Series H Preferred Stock transaction further described in Note 12. Shares of the Series F Preferred Stock are now convertible, at the option of the private investor, into common stock at a variable conversion price equal to 70% of (i) the lowest VWAP of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. Amendment of Outstanding Series F Preferred Stock Conversion Price On October 5, 2016 , the Company filed a Certificate of Amendment to the Certificate of Designations of Preferences, Rights and Limitations of Series F Preferred Stock with the Secretary of State of the State of Delaware. The Certificate of Amendment amends the conversion price at which the Series F Preferred Stock can be converted into shares of common stock. The Company had approximately $336,000 of Series F Preferred Stock remaining outstanding as of October 5, 2016 . As amended, the conversion price will now be equal to the lowest of (i) 50% of the lowest weighted average price (“VWAP”) of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) 50% of the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. If certain “Triggering Events” specified in the terms of the Series F Preferred Stock occur, then the conversion price of the Series F Preferred Stock shall be thereafter reduced, and only reduced, to equal 50% of the average of the lowest traded price of the common stock for the twenty consecutive trading day period prior to the conversion date. The following table summarizes the conversion activity of the Series F Preferred Stock: Conversion Period Principal Converted Dividends Converted Common Shares Issued Q1 2016 $ 2,168,402 $ 19,896 2,183,991 Q2 2016 $ 3,234,000 $ 66,931 6,649,741 Q3 2016 $ 1,261,648 $ 54,096 81,917,367 Q4 2016 $ 175,949 $ 9,168 27,276,006 Q3 2017 $ 20,000 $ — 18,181,818 Q4 2017 $ 107,000 $ 467 172,552,354 $ 6,966,999 $ 150,558 308,761,277 Holders of the Series F Preferred Stock are entitled to dividends in the amount of 7% per annum. As of December 31, 2017 , all shares and accrued dividends had been converted and no balance remained. The Company classified the Series F Preferred Stock as a liability pursuant to ASC 480 on the closing date due to the structure of the financing agreement, whereby the Company has an unconditional obligation that the Company may settle by issuing a variable number of common shares with a monetary value that is fixed and known at inception. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Series F Preferred Stock was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At closing, a derivative liability and a corresponding debt discount in the amount of $1,666,000 were recorded. The debt discount will be charged to interest expense ratably over the life of the Series F Preferred Stock. The derivative balance was $255,324 , as of December 31, 2016 . At December 31, 2017 , the Company recorded the reduction of the remaining embedded derivative associated with the Series F Preferred Stock of $42,347 as a gain in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $255,324 , to properly reflect the elimination of the embedded derivative as of December 31, 2017 . SERIES G PREFERRED STOCK On April 29, 2016 , the Company entered into a securities purchase agreement with private investors to issue 2,000 shares of Series G Preferred Stock for $2,000,000 . The Company issued 2,000 shares of Series G Preferred Stock to the private investors, in various tranches between April and June 2016, resulting in gross proceeds to the Company of $2,000,000 . Holders of the Series G Preferred Stock are entitled to dividends in the amount of 10% per annum. One year after issuance, the Company is required to redeem for cash all or any portion of the outstanding shares of the Series G Preferred Stock at a price per share equal to $1,000 plus any accrued but unpaid dividends thereon. Assignment of Series G Preferred Stock Beginning September 19, 2016 , the two private investors (the “Series G Sellers”) entered into assignment agreements with accredited investors (the “Series G Purchasers”). Under the terms of the assignment agreements, the Series G Sellers may sell all 2,000 outstanding shares of Series G Preferred Stock to the Series G Purchasers for a purchase price of $1,000 per share of Series G Preferred Stock (plus the amount of any accrued and unpaid dividends thereon). During 2016 and 2017, the Series G Sellers had sold 1,795 shares of Series G Preferred Stock, representing a value of $1,795,000 , to the Series G Purchasers. On September 21, 2016 , the Company filed a Certificate of Amendment to the Certificate of Designations of Prefe |
Series I Preferred Stock and Se
Series I Preferred Stock and Series I Convertible Notes | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Preferred Stock | SERIES H PREFERRED STOCK AND JULY 2016 CONVERTIBLE NOTES Series H Preferred Stock On June 9, 2016 , the Company entered into a securities purchase agreement with a private investor to issue 2,500 shares of Series H Preferred Stock for $2,500,000 . The Company received gross proceeds of $250,000 at Closing. Additional gross proceeds of $580,000 were received by the Company through July 7, 2016. The Company agreed to exchange outstanding Series H Preferred Stock for Senior Secured Convertible Notes (“July 2016 Notes”) on July 13, 2016 . At the date of the exchange, the Company had sold and issued 830 shares of Series H Preferred Stock to the private investor in exchange for $830,000 of gross proceeds. Please see the section below for details of the exchange. July 2016 Convertible Notes On July 13, 2016 , the Company entered into a securities purchase agreement (the “Note SPA”) with the private investor for the private placement of $2,082,600 of the Company’s 4% Original Issue Discount Senior Secured Convertible Promissory Notes (the “July 2016 Convertible Notes”). On July 13, 2016 , the Company sold and issued $364,000 principal amount of notes to the investor in exchange for $350,000 of gross proceeds. The Company sold and issued the remaining $1,718,600 principal amount of July 2016 Convertible Notes to the investor in exchange for $1,650,000 of gross proceeds in weekly tranches between July and September 2016. The Company and the private investor also entered into an Exchange Agreement dated July 13, 2016 (the “Exchange Agreement”). Under the terms of the Exchange Agreement, the outstanding shares of Series H Preferred Stock (approximately $833,000 of capital and accrued dividends) were canceled. In exchange, the Company issued to the private investor approximately $866,000 of July 2016 Convertible Notes. There were 830 shares of Series H Preferred Stock outstanding as of the date of the Exchange Agreement. Unless earlier converted or prepaid, all of the July 2016 Convertible Notes will mature July 13, 2017 . The July 2016 Convertible Notes bear interest at a rate of 10% per annum, subject to increase to 24% per annum upon the occurrence and continuance of an event of default. Principal on the July 2016 Convertible Notes is payable on the Maturity Date. Interest on the July 2016 Convertible Notes is payable quarterly. Principal and interest are payable in cash or, if specified equity conditions are met, shares of Common Stock. The July 2016 Convertible Notes are secured by a security interest in substantially all of the Company’s assets. The subsidiaries of the Company have guaranteed the Company’s obligations under the July 2016 Convertible Notes. The July 2016 Convertible Notes contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the July 2016 Convertible Notes; (ii) bankruptcy or insolvency of the Company; and (iii) failure to file a registration statement by October 9, 2016. On October 10, 2016 the Company had not been successful in filing the registration statement triggering an event of default per the July 2016 Note Agreement. Upon default the interest rate increases to 24% per annum and the holder of the July 2016 Notes has the option to accelerate the Note and demand cash payment of the Mandatory Default Amount consisting of a 25% premium of the principal balance plus any accrued and unpaid interest. The Company began accruing interest at the rate of 24% on October 10, 2016. Forbearance and Settlement Agreement on July 2016 Convertible Notes On May 5, 2017 , the Company entered into a Forbearance and Settlement Agreement ("Forbearance Agreement") with a holder of certain secured convertible notes that are in default due to various triggering events. The holder and the Company agreed to forbear from taking any action provided for under the secured convertible notes in exchange for the following terms provided in this agreement: • The Company agreed to redeem for cash all secured convertible notes of the Company held by the holder no later than September 1, 2017 . • The Company affirmed that the current balance of owed principal and accrued and unpaid interest to the holder is $1,790,214 as of May 2, 2017 . • The redemption price for such secured convertible notes shall be 120% (if redeemed on or prior to August 15, 2017 ) or 125% (if redeemed after August 15, 2017 ) of the then outstanding principal, plus any accrued and unpaid interest. • During the month of May 2017, the Holder agreed to limit its conversions of outstanding Company secured convertible notes to $50,000 per calendar week of principal/interest. • During the months of June, July and August 2017, the holder agreed to limit its conversions of outstanding Company secured convertible notes to $75,000 per calendar week of principal/interest. • During the months of May, June, July and August 2017, the holder agreed that all outstanding Company secured convertible notes shall bear interest at the normal stated rate of 10% , rather than default rate of 24% . • All conversions during the months of May, June, July and August 2017 will be at the “triggering event” discount conversion price as stated in the secured convertible notes, and will continue at the “triggering event” discount price until, if and when the notes are redeemed. • Should the Company fail to redeem for cash all secured convertible notes on or before September 1, 2017 , default interest and normal stated interest will accrue from the date of execution of this agreement. All principal and accrued interest on the July 2016 Convertible Notes are convertible at any time, in whole or in part, at the option of the private investor, into shares of Common Stock at a variable conversion price equal to the lowest of (i) $0.045 (the “Fixed Conversion Price”), (ii) 70% of the lowest volume weighted average price (“VWAP”) of the Company's common stock for the ten consecutive trading day period prior to the conversion date or (iii) 70% of the lowest closing bid price of the Company's common stock for the ten consecutive trading day period prior to the conversion date. If certain defined triggering events occur, the conversion price would thereafter be reduced (and only reduced), to equal 60% of the lower of (i) the lowest closing bid price of the Company's common stock for the thirty consecutive trading day period prior to the conversion date or (ii) the lowest VWAP of the the Company's common stock for the thirty consecutive trading day period prior to the conversion date. In addition, on the 90th day and also on the 180th day from the date of the Note SPA, the private investor may reset the Fixed Conversion Price to thereafter be equal to the VWAP of the Common Stock for such day or if such 90th or 180th day is not a trading day, then the VWAP for the immediately preceding trading day. The following table summarizes the conversion activity on the principal of the July 2106 Convertible Notes: Conversion Period Principal Converted Common Shares Issued Q4 2016 $ 152,460 64,000,000 Q1 2017 1,017,732 959,704,543 Q2 2017 682,235 1,865,043,998 $ 1,852,427 2,888,748,541 In addition to the $1,852,427 in principal conversions, $3,960 of interest was converted during 2017. As of December 31, 2017 , with $1,096,600 of principal payments, $400,017 of interest payments, and $219,320 of redemption penalty payments, the July 2016 Convertible notes had been redeemed in full. The difference in the accrued interest and the paid interest, due to the terms of the settlement agreement, was $22,661 which was credited to interest expense upon full redemption of the instrument. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the July 2016 Convertible Notes was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At December 31, 2016 the fair value of the derivative liability was $3,733,348 . Throughout 2017, the Company recorded the fair value changes of the embedded derivative associated with the July 2016 Convertible Notes as a gain or loss in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $3,733,348 , to properly reflect the elimination of the embedded derivative upon the extinguishment of the liability. OCTOBER 2016 CONVERTIBLE NOTES AND EXCHANGE OF SERIES A PREFERRED STOCK October 2016 Convertible Notes On October 5, 2016 , the Company entered into a securities purchase agreement with a private investor (“Adar Bays”) for the private placement of $330,000 principal amount of October 2016 Convertible Notes. At Closing, the Company sold and issued $330,000 principal amount of October 2016 Convertible Notes to Adar Bays in exchange for $300,000 of gross proceeds. Unless earlier converted or prepaid, the October 2016 Convertible Notes will mature December 31, 2017 (the “Maturity Date”). The October 2016 Convertible Notes bear interest at a rate of 6% per annum, subject to increase to 24% per annum upon the occurrence and continuance of an event of default (as described below). Principal and accrued interest on the October 2016 Convertible Notes is payable on the Maturity Date. All principal and accrued interest on the October 2016 Convertible Notes are convertible at any time, in whole or in part, at the option of Adar Bays, into shares of common stock at a variable conversion price equal to 80% of the lowest closing bid price of the Company’s common stock for the 15 consecutive trading day period prior to the conversion date. After the six month anniversary of the issuance of any October 2016 Convertible Note, the conversion price for such note shall thereafter be equal to 50% of the lowest closing bid price of the Company’s common stock for the 15 consecutive trading day period prior to the conversion date. The October 2016 Convertible Notes contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the October 2016 Convertible Notes; and (ii) bankruptcy or insolvency of the Company. Outstanding principal and accrued interest on the October 2016 Convertible Notes were $330,000 and $24,860 , respectively as of December 31, 2017 . Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the October 2016 Convertible Notes were deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At closing, a derivative liability and a corresponding debt discount in the amount of $330,000 was recorded. The fair value of the derivative was greater than the face value at issuance and the difference of $341,114 was charged to interest expense at issuance. The remaining debt discount will be charged to interest expense ratably over the life of the October 2016 Convertible Notes. As of December 31, 2016 , the fair value of the derivative liability was $544,746 . The derivative liability associated with the October 2016 Convertible Notes is subject to revaluation on a quarterly basis to reflect the market value change of the embedded conversion option. At December 31, 2017 , the Company conducted a fair value assessment of the embedded derivative associated with the October 2016 Convertible Notes. As a result of the fair value assessment, the Company recorded a $279,442 loss as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations for the three months ended December 31, 2017 . The net loss recorded for the year ended December 31, 2017 was $27,897 , to properly reflect the fair value of the embedded derivative of $572,643 as of December 31, 2017 . The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The derivative associated with the October 2016 Convertible Notes approximates management’s estimate of the fair value of the embedded derivative liability at December 31, 2017 based on using a Monte Carlo simulation following a Geometric Brownian Motion with the following assumptions: annual volatility of 65% present value discount rate of 12% and dividend yield of 0% . Exchange of Outstanding Series A Preferred Stock for Convertible Notes In 2013, the Company completed private placement to one accredited investor (the “Series A Holder”) of its Series A Convertible Preferred Stock. Prior to the exchange agreement described below the Company had $165,541 shares of Series A Preferred Stock that remained outstanding as of October 6, 2016 . On October 6, 2016 , the Series A Holder entered into an exchange agreement (the “Exchange Agreement”) with Adar Bays. Pursuant to the exchange agreement, beginning December 5, 2016, Adar Bays has the option to exchange, from time to time, all or any portion of the October 2016 Convertible Notes for outstanding shares of Series A Preferred Stock from the Series A Holder. As of March 31, 2017, Adar Bays had elected to exchange all outstanding October 2016 Convertible Notes, in accordance with the exchange agreement, and the Series A Holder held $330,000 of the October 2016 Convertible Notes. SERIES A PREFERRED STOCK In June 2013, the Company entered into a Securities Purchase Agreement with an investor to sell an aggregate of 750,000 shares of Series A Preferred Stock at a price of $8 per share, resulting in gross proceeds of $6,000,000 . This purchase agreement included warrants to purchase up to 13,125 shares of common stock of the Company. The transfer of cash and securities took place incrementally, the first closing occurring on June 17, 2013 with the transfer of 125,000 shares of Series A Preferred Stock and a warrant to purchase 2,187 shares of common stock for $1,000,000 . The final closings took place in August 2013, with the transfer of 625,000 shares of Series A Preferred Stock and a warrant to purchase 10,938 shares of common stock for $5,000,000 . Holders of Series A Preferred Stock are entitled to cumulative dividends at a rate of 8% per annum when and if declared by the Board of Directors in its sole discretion. The dividends may be paid in cash or in the form of common stock (valued at 10% below market price, but not to exceed the lowest closing price during the applicable measurement period), at the discretion of the Board of Directors. The dividend rate on the Series A Preferred Stock is indexed to the Company's stock price and subject to adjustment. In addition, the Series A Preferred Stock contains a make-whole provision whereby, conversion or redemption of the preferred stock within 4 years of issuance will require dividends for the full four year period to be paid by the Company in cash or common stock (valued at 10% below market price, but not to exceed the lowest closing price during the applicable measurement period). This make-whole provision expired in June 2017 and future conversions and redemptions will be paid out with accrued dividends per the holding period of the shares of Series A Preferred stock. Please see Note 23 for more information. The Series A Preferred Stock may be converted into shares of common stock at the option of the Company if the closing price of the common stock exceeds $232 , as adjusted, for 20 consecutive trading days, or by the holder at any time. The Company has the right to redeem the Series A Preferred Stock at a price of $8 per share, plus any accrued and unpaid dividends, plus the make-whole amount (if applicable). At December 31, 2017 , the preferred shares were not eligible for conversion to common shares at the option of the Company. The holder of the preferred shares may convert to common shares at any time, at no cost, at a ratio of 1 preferred share into 1 common share (subject to standard ratable anti-dilution adjustments). Upon any conversion (whether at the option of the Company or the holder), the holder is entitled to receive any accrued but unpaid dividends. On October 6, 2016, the Series A Holder entered into an exchange agreement (the “Exchange Agreement”) with Adar Bays. Pursuant to the exchange agreement, beginning December 5, 2016, Adar Bays has the option to exchange, from time to time, all or any portion of the October 2016 Convertible Notes (see Note 13) for outstanding shares of Series A Preferred Stock from the Series A Holder. As of December 31, 2017 , Adar Bays had elected to exchange all outstanding October 2016 Convertible Notes, in accordance with the exchange agreement, resulting in the exchange of 104,785 shares of Series A Preferred Stock. As of December 31, 2017 , Adar Bays had also converted their 104,785 shares of Series A Preferred Stock, and the related make whole dividend, which resulted in the issuance of 173,946,250 shares of common stock. Except as otherwise required by law (or with respect to approval of certain actions), the Series A Preferred Stock shall have no voting rights. Upon any liquidation, dissolution or winding up of the Company, after payment or provision for payment of debts and other liabilities of the Company, the holders of Series A Preferred Stock shall be entitled to receive, pari passu with any distribution to the holders of common stock of the Company, an amount equal to $8 per share of Series A Preferred Stock plus any accrued and unpaid dividends. As of December 31, 2017 , there were 60,756 shares of Series A Preferred Stock outstanding and accrued and unpaid dividends of $279,815 . SERIES E PREFERRED STOCK AND THE COMMITTED EQUITY LINE Series E Preferred Stock On November 4, 2015 , the Company entered into a securities purchase agreement with a private investor to issue 2,800 shares of Series E Preferred Stock in exchange for $2,800,000 . Shares of the Series E Preferred Stock (including the amount of any accrued and unpaid dividends thereon) are convertible, at the option of the holder, into common stock at a variable conversion price equal to 80% of the average of the two lowest VWAPs of the Company's common stock for the ten consecutive trading day period prior to the conversion date. If certain defined default events occur, the conversion price would thereafter be reduced (and only reduced), to equal 70% of the average of the two lowest VWAPs of the Company's common stock for the twenty consecutive trading day period prior to the conversion date. The private investor had available to them a new conversion price beginning on June 9, 2016 as a result of the Series H Preferred Stock transaction further described in Note 12. Shares of the Series E Preferred Stock are now convertible, at the option of the private investor, into common stock at a variable conversion price equal to 70% of (i) the lowest VWAP of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. The following table summarizes the conversion activity of the Series E Preferred Stock: Conversion Period Preferred Series E Shares Converted Value of Series E Preferred Shares (inclusive of accrued dividends) Common Shares Issued Q4 2015 478 $ 481,500 250,000 Q1 2016 1,220 1,239,436 1,132,000 Q2 2016 365 381,414 7,979,568 Q3 2016 523 548,896 21,973,747 Q4 2016 94 101,018 13,089,675 Q1 2017 15 16,248 8,289,962 Q2 2017 35 38,886 134,927,207 Q3 2017 70 76,814 129,314,677 2,800 $ 2,884,212 316,956,836 Holders of the Series E Preferred Stock will be entitled to dividends in the amount of 7% per annum. During the year ended December 31, 2017 , the holder converted dividends in the amount of $11,948 on the Series E Preferred Stock, resulting in the issuance of 25,160,171 shares of common stock. On September 30, 2017, the Company paid $2,013 in cash for the remaining accrued dividends. The Company has issued 18,000 shares of common stock to the private investor as a commitment fee relating to the Series E Preferred Stock. Costs associated with the Series E Preferred Stock, such as legal fees and commitment shares are capitalized and reported as deferred financing costs on the Condensed Consolidated Balance Sheets. The total gross debt issuance cost incurred by the Company related to the Series E Preferred Stock was $104,000 . These debt issuance costs will be recognized as additional interest expense over the life of the Series E Preferred Stock. As of December 31, 2017 , all outstanding shares of Series E Preferred Stock, along with all accrued dividends, had either been converted or redeemed. The Company classified the Series E Preferred Stock as a liability pursuant to ASC 480 on the closing date due to the structure of the financing agreement, whereby the Company has an unconditional obligation that the Company may settle by issuing a variable number of common shares with a monetary value that is fixed and known at inception. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Series E Preferred Stock was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At December 31, 2016 the fair value of the derivative liability was $140,748 . At September 30, 2017, the Company recorded the reduction of the remaining embedded derivative associated with the Series E Preferred Stock of $121,390 as a gain in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $140,748 , to properly reflect the elimination of the embedded derivative as of December 31, 2017 . The Committed Equity Line On November 10, 2015, the Company and the private investor entered into a committed equity line purchase agreement (the "CEL"). Under the terms and subject to the conditions of the CEL purchase agreement, at its option the Company has the right to sell to the private investor, and the private investor is obligated to purchase from the Company, up to $32.2 million of the Company’s common stock, subject to certain limitations, from time to time, over the 36 -month period commencing on December 18, 2015, the date that the registration statement was declared effective by the SEC. From time to time, the Company may direct the private investor, at its sole discretion and subject to certain conditions, to purchase an amount of shares of common stock up to the lesser of (i) $1,000,000 or (ii) 300% of the average daily trading volume of the Company’s common stock over the preceding ten trading day period. The per share purchase price for shares of common stock to be sold by the Company under the CEL purchase agreement shall be equal to 80% of the average of the two lowest VWAPs of the common stock for the ten consecutive trading day period prior to the purchase date. In total, the Company directed the private investor to purchase $3,056,147 of common stock which resulted in the issuance of 1,368,000 shares of common stock. The Company may not direct the private investor to purchase shares of common stock more frequently than once each ten business days. The Company’s sales of shares of common stock to the private investor under the CEL purchase agreement are limited to no more than the number of shares that would result in the beneficial ownership by the private investor and its affiliates, at any single point in time, of more than 9.99% of the Company’s then outstanding shares of common stock. As consideration for entering into the CEL purchase agreement, the Company agreed to issue to the private investor 132,000 shares of common stock (the “Commitment Shares”). The Commitment Shares were issued to the private investor commencing upon the date that the registration statement was declared effective by the SEC. While not officially terminated, the CEL is no longer active and the Company does not consider this a viable source of capital. SERIES F PREFERRED STOCK On January 19, 2016 , the Company entered into a securities purchase agreement with a private investor for the sale of $7,000,000 of the Company’s newly designated Series F Preferred Stock. On January 20, 2016 , the Company sold and issued 7,000 shares of Series F Preferred Stock to the private investor. The aggregate purchase price of the Series F Preferred shares was $7,000,000 . On January 20, 2016 , the private investor paid $500,000 to the Company. The remaining $6,500,000 was paid by the private investor to the Company in 14 weekly increments of $500,000 or $250,000 beginning January 25, 2016 and ending April 28, 2016 . Shares of the Series F Preferred Stock (including the amount of any accrued and unpaid dividends thereon) are convertible, at the option of the holder, into common stock at a fixed conversion price equal to $5 per share. If certain defined default events occur, the conversion price would thereafter be reduced (and only reduced), to equal 70% of the average of the two lowest VWAPs of our common stock for the twenty consecutive trading day period prior to the conversion date. If requested by the private investor, the Company will make weekly redemptions of shares of Series F Preferred Stock (including any accrued and unpaid dividends thereon). If the redemption price is paid by the Company in cash, the number of shares to be redeemed in each weekly increment is 250 shares of Series F Preferred Stock, and the redemption price is a price per share equal to $1,250 plus any accrued but unpaid dividends thereon. The Company has the option to make such redemption payments in shares of common stock provided certain specified equity conditions are satisfied at the time of payment. The number of shares of common stock to be issued would be calculated using a per share price equal to 80% of the one lowest VWAP of our common stock for the ten consecutive trading day period prior to the payment date. For redemption payments made in shares of common stock, the Company will redeem either (i) 250 shares of Series F Preferred Stock or (ii) such greater number of shares of Series F Preferred Stock (and also including any accrued and unpaid dividends) that would result upon redemption in the issuance of a number of shares of common stock equal to 12% of the aggregate composite trading volume for the Company’s common stock during the preceding calendar week. The private investor had available to them a new conversion price beginning on June 9, 2016 as a result of the Series H Preferred Stock transaction further described in Note 12. Shares of the Series F Preferred Stock are now convertible, at the option of the private investor, into common stock at a variable conversion price equal to 70% of (i) the lowest VWAP of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. Amendment of Outstanding Series F Preferred Stock Conversion Price On October 5, 2016 , the Company filed a Certificate of Amendment to the Certificate of Designations of Preferences, Rights and Limitations of Series F Preferred Stock with the Secretary of State of the State of Delaware. The Certificate of Amendment amends the conversion price at which the Series F Preferred Stock can be converted into shares of common stock. The Company had approximately $336,000 of Series F Preferred Stock remaining outstanding as of October 5, 2016 . As amended, the conversion price will now be equal to the lowest of (i) 50% of the lowest weighted average price (“VWAP”) of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) 50% of the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. If certain “Triggering Events” specified in the terms of the Series F Preferred Stock occur, then the conversion price of the Series F Preferred Stock shall be thereafter reduced, and only reduced, to equal 50% of the average of the lowest traded price of the common stock for the twenty consecutive trading day period prior to the conversion date. The following table summarizes the conversion activity of the Series F Preferred Stock: Conversion Period Principal Converted Dividends Converted Common Shares Issued Q1 2016 $ 2,168,402 $ 19,896 2,183,991 Q2 2016 $ 3,234,000 $ 66,931 6,649,741 Q3 2016 $ 1,261,648 $ 54,096 81,917,367 Q4 2016 $ 175,949 $ 9,168 27,276,006 Q3 2017 $ 20,000 $ — 18,181,818 Q4 2017 $ 107,000 $ 467 172,552,354 $ 6,966,999 $ 150,558 308,761,277 Holders of the Series F Preferred Stock are entitled to dividends in the amount of 7% per annum. As of December 31, 2017 , all shares and accrued dividends had been converted and no balance remained. The Company classified the Series F Preferred Stock as a liability pursuant to ASC 480 on the closing date due to the structure of the financing agreement, whereby the Company has an unconditional obligation that the Company may settle by issuing a variable number of common shares with a monetary value that is fixed and known at inception. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Series F Preferred Stock was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At closing, a derivative liability and a corresponding debt discount in the amount of $1,666,000 were recorded. The debt discount will be charged to interest expense ratably over the life of the Series F Preferred Stock. The derivative balance was $255,324 , as of December 31, 2016 . At December 31, 2017 , the Company recorded the reduction of the remaining embedded derivative associated with the Series F Preferred Stock of $42,347 as a gain in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $255,324 , to properly reflect the elimination of the embedded derivative as of December 31, 2017 . SERIES G PREFERRED STOCK On April 29, 2016 , the Company entered into a securities purchase agreement with private investors to issue 2,000 shares of Series G Preferred Stock for $2,000,000 . The Company issued 2,000 shares of Series G Preferred Stock to the private investors, in various tranches between April and June 2016, resulting in gross proceeds to the Company of $2,000,000 . Holders of the Series G Preferred Stock are entitled to dividends in the amount of 10% per annum. One year after issuance, the Company is required to redeem for cash all or any portion of the outstanding shares of the Series G Preferred Stock at a price per share equal to $1,000 plus any accrued but unpaid dividends thereon. Assignment of Series G Preferred Stock Beginning September 19, 2016 , the two private investors (the “Series G Sellers”) entered into assignment agreements with accredited investors (the “Series G Purchasers”). Under the terms of the assignment agreements, the Series G Sellers may sell all 2,000 outstanding shares of Series G Preferred Stock to the Series G Purchasers for a purchase price of $1,000 per share of Series G Preferred Stock (plus the amount of any accrued and unpaid dividends thereon). During 2016 and 2017, the Series G Sellers had sold 1,795 shares of Series G Preferred Stock, representing a value of $1,795,000 , to the Series G Purchasers. On September 21, 2016 , the Company filed a Certificate of Amendment to the Certificate of Designations of Prefe |
Series J Preferred Stock and Se
Series J Preferred Stock and Series J-1 Preferred Stock | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Preferred Stock | SERIES H PREFERRED STOCK AND JULY 2016 CONVERTIBLE NOTES Series H Preferred Stock On June 9, 2016 , the Company entered into a securities purchase agreement with a private investor to issue 2,500 shares of Series H Preferred Stock for $2,500,000 . The Company received gross proceeds of $250,000 at Closing. Additional gross proceeds of $580,000 were received by the Company through July 7, 2016. The Company agreed to exchange outstanding Series H Preferred Stock for Senior Secured Convertible Notes (“July 2016 Notes”) on July 13, 2016 . At the date of the exchange, the Company had sold and issued 830 shares of Series H Preferred Stock to the private investor in exchange for $830,000 of gross proceeds. Please see the section below for details of the exchange. July 2016 Convertible Notes On July 13, 2016 , the Company entered into a securities purchase agreement (the “Note SPA”) with the private investor for the private placement of $2,082,600 of the Company’s 4% Original Issue Discount Senior Secured Convertible Promissory Notes (the “July 2016 Convertible Notes”). On July 13, 2016 , the Company sold and issued $364,000 principal amount of notes to the investor in exchange for $350,000 of gross proceeds. The Company sold and issued the remaining $1,718,600 principal amount of July 2016 Convertible Notes to the investor in exchange for $1,650,000 of gross proceeds in weekly tranches between July and September 2016. The Company and the private investor also entered into an Exchange Agreement dated July 13, 2016 (the “Exchange Agreement”). Under the terms of the Exchange Agreement, the outstanding shares of Series H Preferred Stock (approximately $833,000 of capital and accrued dividends) were canceled. In exchange, the Company issued to the private investor approximately $866,000 of July 2016 Convertible Notes. There were 830 shares of Series H Preferred Stock outstanding as of the date of the Exchange Agreement. Unless earlier converted or prepaid, all of the July 2016 Convertible Notes will mature July 13, 2017 . The July 2016 Convertible Notes bear interest at a rate of 10% per annum, subject to increase to 24% per annum upon the occurrence and continuance of an event of default. Principal on the July 2016 Convertible Notes is payable on the Maturity Date. Interest on the July 2016 Convertible Notes is payable quarterly. Principal and interest are payable in cash or, if specified equity conditions are met, shares of Common Stock. The July 2016 Convertible Notes are secured by a security interest in substantially all of the Company’s assets. The subsidiaries of the Company have guaranteed the Company’s obligations under the July 2016 Convertible Notes. The July 2016 Convertible Notes contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the July 2016 Convertible Notes; (ii) bankruptcy or insolvency of the Company; and (iii) failure to file a registration statement by October 9, 2016. On October 10, 2016 the Company had not been successful in filing the registration statement triggering an event of default per the July 2016 Note Agreement. Upon default the interest rate increases to 24% per annum and the holder of the July 2016 Notes has the option to accelerate the Note and demand cash payment of the Mandatory Default Amount consisting of a 25% premium of the principal balance plus any accrued and unpaid interest. The Company began accruing interest at the rate of 24% on October 10, 2016. Forbearance and Settlement Agreement on July 2016 Convertible Notes On May 5, 2017 , the Company entered into a Forbearance and Settlement Agreement ("Forbearance Agreement") with a holder of certain secured convertible notes that are in default due to various triggering events. The holder and the Company agreed to forbear from taking any action provided for under the secured convertible notes in exchange for the following terms provided in this agreement: • The Company agreed to redeem for cash all secured convertible notes of the Company held by the holder no later than September 1, 2017 . • The Company affirmed that the current balance of owed principal and accrued and unpaid interest to the holder is $1,790,214 as of May 2, 2017 . • The redemption price for such secured convertible notes shall be 120% (if redeemed on or prior to August 15, 2017 ) or 125% (if redeemed after August 15, 2017 ) of the then outstanding principal, plus any accrued and unpaid interest. • During the month of May 2017, the Holder agreed to limit its conversions of outstanding Company secured convertible notes to $50,000 per calendar week of principal/interest. • During the months of June, July and August 2017, the holder agreed to limit its conversions of outstanding Company secured convertible notes to $75,000 per calendar week of principal/interest. • During the months of May, June, July and August 2017, the holder agreed that all outstanding Company secured convertible notes shall bear interest at the normal stated rate of 10% , rather than default rate of 24% . • All conversions during the months of May, June, July and August 2017 will be at the “triggering event” discount conversion price as stated in the secured convertible notes, and will continue at the “triggering event” discount price until, if and when the notes are redeemed. • Should the Company fail to redeem for cash all secured convertible notes on or before September 1, 2017 , default interest and normal stated interest will accrue from the date of execution of this agreement. All principal and accrued interest on the July 2016 Convertible Notes are convertible at any time, in whole or in part, at the option of the private investor, into shares of Common Stock at a variable conversion price equal to the lowest of (i) $0.045 (the “Fixed Conversion Price”), (ii) 70% of the lowest volume weighted average price (“VWAP”) of the Company's common stock for the ten consecutive trading day period prior to the conversion date or (iii) 70% of the lowest closing bid price of the Company's common stock for the ten consecutive trading day period prior to the conversion date. If certain defined triggering events occur, the conversion price would thereafter be reduced (and only reduced), to equal 60% of the lower of (i) the lowest closing bid price of the Company's common stock for the thirty consecutive trading day period prior to the conversion date or (ii) the lowest VWAP of the the Company's common stock for the thirty consecutive trading day period prior to the conversion date. In addition, on the 90th day and also on the 180th day from the date of the Note SPA, the private investor may reset the Fixed Conversion Price to thereafter be equal to the VWAP of the Common Stock for such day or if such 90th or 180th day is not a trading day, then the VWAP for the immediately preceding trading day. The following table summarizes the conversion activity on the principal of the July 2106 Convertible Notes: Conversion Period Principal Converted Common Shares Issued Q4 2016 $ 152,460 64,000,000 Q1 2017 1,017,732 959,704,543 Q2 2017 682,235 1,865,043,998 $ 1,852,427 2,888,748,541 In addition to the $1,852,427 in principal conversions, $3,960 of interest was converted during 2017. As of December 31, 2017 , with $1,096,600 of principal payments, $400,017 of interest payments, and $219,320 of redemption penalty payments, the July 2016 Convertible notes had been redeemed in full. The difference in the accrued interest and the paid interest, due to the terms of the settlement agreement, was $22,661 which was credited to interest expense upon full redemption of the instrument. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the July 2016 Convertible Notes was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At December 31, 2016 the fair value of the derivative liability was $3,733,348 . Throughout 2017, the Company recorded the fair value changes of the embedded derivative associated with the July 2016 Convertible Notes as a gain or loss in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $3,733,348 , to properly reflect the elimination of the embedded derivative upon the extinguishment of the liability. OCTOBER 2016 CONVERTIBLE NOTES AND EXCHANGE OF SERIES A PREFERRED STOCK October 2016 Convertible Notes On October 5, 2016 , the Company entered into a securities purchase agreement with a private investor (“Adar Bays”) for the private placement of $330,000 principal amount of October 2016 Convertible Notes. At Closing, the Company sold and issued $330,000 principal amount of October 2016 Convertible Notes to Adar Bays in exchange for $300,000 of gross proceeds. Unless earlier converted or prepaid, the October 2016 Convertible Notes will mature December 31, 2017 (the “Maturity Date”). The October 2016 Convertible Notes bear interest at a rate of 6% per annum, subject to increase to 24% per annum upon the occurrence and continuance of an event of default (as described below). Principal and accrued interest on the October 2016 Convertible Notes is payable on the Maturity Date. All principal and accrued interest on the October 2016 Convertible Notes are convertible at any time, in whole or in part, at the option of Adar Bays, into shares of common stock at a variable conversion price equal to 80% of the lowest closing bid price of the Company’s common stock for the 15 consecutive trading day period prior to the conversion date. After the six month anniversary of the issuance of any October 2016 Convertible Note, the conversion price for such note shall thereafter be equal to 50% of the lowest closing bid price of the Company’s common stock for the 15 consecutive trading day period prior to the conversion date. The October 2016 Convertible Notes contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the October 2016 Convertible Notes; and (ii) bankruptcy or insolvency of the Company. Outstanding principal and accrued interest on the October 2016 Convertible Notes were $330,000 and $24,860 , respectively as of December 31, 2017 . Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the October 2016 Convertible Notes were deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At closing, a derivative liability and a corresponding debt discount in the amount of $330,000 was recorded. The fair value of the derivative was greater than the face value at issuance and the difference of $341,114 was charged to interest expense at issuance. The remaining debt discount will be charged to interest expense ratably over the life of the October 2016 Convertible Notes. As of December 31, 2016 , the fair value of the derivative liability was $544,746 . The derivative liability associated with the October 2016 Convertible Notes is subject to revaluation on a quarterly basis to reflect the market value change of the embedded conversion option. At December 31, 2017 , the Company conducted a fair value assessment of the embedded derivative associated with the October 2016 Convertible Notes. As a result of the fair value assessment, the Company recorded a $279,442 loss as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations for the three months ended December 31, 2017 . The net loss recorded for the year ended December 31, 2017 was $27,897 , to properly reflect the fair value of the embedded derivative of $572,643 as of December 31, 2017 . The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The derivative associated with the October 2016 Convertible Notes approximates management’s estimate of the fair value of the embedded derivative liability at December 31, 2017 based on using a Monte Carlo simulation following a Geometric Brownian Motion with the following assumptions: annual volatility of 65% present value discount rate of 12% and dividend yield of 0% . Exchange of Outstanding Series A Preferred Stock for Convertible Notes In 2013, the Company completed private placement to one accredited investor (the “Series A Holder”) of its Series A Convertible Preferred Stock. Prior to the exchange agreement described below the Company had $165,541 shares of Series A Preferred Stock that remained outstanding as of October 6, 2016 . On October 6, 2016 , the Series A Holder entered into an exchange agreement (the “Exchange Agreement”) with Adar Bays. Pursuant to the exchange agreement, beginning December 5, 2016, Adar Bays has the option to exchange, from time to time, all or any portion of the October 2016 Convertible Notes for outstanding shares of Series A Preferred Stock from the Series A Holder. As of March 31, 2017, Adar Bays had elected to exchange all outstanding October 2016 Convertible Notes, in accordance with the exchange agreement, and the Series A Holder held $330,000 of the October 2016 Convertible Notes. SERIES A PREFERRED STOCK In June 2013, the Company entered into a Securities Purchase Agreement with an investor to sell an aggregate of 750,000 shares of Series A Preferred Stock at a price of $8 per share, resulting in gross proceeds of $6,000,000 . This purchase agreement included warrants to purchase up to 13,125 shares of common stock of the Company. The transfer of cash and securities took place incrementally, the first closing occurring on June 17, 2013 with the transfer of 125,000 shares of Series A Preferred Stock and a warrant to purchase 2,187 shares of common stock for $1,000,000 . The final closings took place in August 2013, with the transfer of 625,000 shares of Series A Preferred Stock and a warrant to purchase 10,938 shares of common stock for $5,000,000 . Holders of Series A Preferred Stock are entitled to cumulative dividends at a rate of 8% per annum when and if declared by the Board of Directors in its sole discretion. The dividends may be paid in cash or in the form of common stock (valued at 10% below market price, but not to exceed the lowest closing price during the applicable measurement period), at the discretion of the Board of Directors. The dividend rate on the Series A Preferred Stock is indexed to the Company's stock price and subject to adjustment. In addition, the Series A Preferred Stock contains a make-whole provision whereby, conversion or redemption of the preferred stock within 4 years of issuance will require dividends for the full four year period to be paid by the Company in cash or common stock (valued at 10% below market price, but not to exceed the lowest closing price during the applicable measurement period). This make-whole provision expired in June 2017 and future conversions and redemptions will be paid out with accrued dividends per the holding period of the shares of Series A Preferred stock. Please see Note 23 for more information. The Series A Preferred Stock may be converted into shares of common stock at the option of the Company if the closing price of the common stock exceeds $232 , as adjusted, for 20 consecutive trading days, or by the holder at any time. The Company has the right to redeem the Series A Preferred Stock at a price of $8 per share, plus any accrued and unpaid dividends, plus the make-whole amount (if applicable). At December 31, 2017 , the preferred shares were not eligible for conversion to common shares at the option of the Company. The holder of the preferred shares may convert to common shares at any time, at no cost, at a ratio of 1 preferred share into 1 common share (subject to standard ratable anti-dilution adjustments). Upon any conversion (whether at the option of the Company or the holder), the holder is entitled to receive any accrued but unpaid dividends. On October 6, 2016, the Series A Holder entered into an exchange agreement (the “Exchange Agreement”) with Adar Bays. Pursuant to the exchange agreement, beginning December 5, 2016, Adar Bays has the option to exchange, from time to time, all or any portion of the October 2016 Convertible Notes (see Note 13) for outstanding shares of Series A Preferred Stock from the Series A Holder. As of December 31, 2017 , Adar Bays had elected to exchange all outstanding October 2016 Convertible Notes, in accordance with the exchange agreement, resulting in the exchange of 104,785 shares of Series A Preferred Stock. As of December 31, 2017 , Adar Bays had also converted their 104,785 shares of Series A Preferred Stock, and the related make whole dividend, which resulted in the issuance of 173,946,250 shares of common stock. Except as otherwise required by law (or with respect to approval of certain actions), the Series A Preferred Stock shall have no voting rights. Upon any liquidation, dissolution or winding up of the Company, after payment or provision for payment of debts and other liabilities of the Company, the holders of Series A Preferred Stock shall be entitled to receive, pari passu with any distribution to the holders of common stock of the Company, an amount equal to $8 per share of Series A Preferred Stock plus any accrued and unpaid dividends. As of December 31, 2017 , there were 60,756 shares of Series A Preferred Stock outstanding and accrued and unpaid dividends of $279,815 . SERIES E PREFERRED STOCK AND THE COMMITTED EQUITY LINE Series E Preferred Stock On November 4, 2015 , the Company entered into a securities purchase agreement with a private investor to issue 2,800 shares of Series E Preferred Stock in exchange for $2,800,000 . Shares of the Series E Preferred Stock (including the amount of any accrued and unpaid dividends thereon) are convertible, at the option of the holder, into common stock at a variable conversion price equal to 80% of the average of the two lowest VWAPs of the Company's common stock for the ten consecutive trading day period prior to the conversion date. If certain defined default events occur, the conversion price would thereafter be reduced (and only reduced), to equal 70% of the average of the two lowest VWAPs of the Company's common stock for the twenty consecutive trading day period prior to the conversion date. The private investor had available to them a new conversion price beginning on June 9, 2016 as a result of the Series H Preferred Stock transaction further described in Note 12. Shares of the Series E Preferred Stock are now convertible, at the option of the private investor, into common stock at a variable conversion price equal to 70% of (i) the lowest VWAP of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. The following table summarizes the conversion activity of the Series E Preferred Stock: Conversion Period Preferred Series E Shares Converted Value of Series E Preferred Shares (inclusive of accrued dividends) Common Shares Issued Q4 2015 478 $ 481,500 250,000 Q1 2016 1,220 1,239,436 1,132,000 Q2 2016 365 381,414 7,979,568 Q3 2016 523 548,896 21,973,747 Q4 2016 94 101,018 13,089,675 Q1 2017 15 16,248 8,289,962 Q2 2017 35 38,886 134,927,207 Q3 2017 70 76,814 129,314,677 2,800 $ 2,884,212 316,956,836 Holders of the Series E Preferred Stock will be entitled to dividends in the amount of 7% per annum. During the year ended December 31, 2017 , the holder converted dividends in the amount of $11,948 on the Series E Preferred Stock, resulting in the issuance of 25,160,171 shares of common stock. On September 30, 2017, the Company paid $2,013 in cash for the remaining accrued dividends. The Company has issued 18,000 shares of common stock to the private investor as a commitment fee relating to the Series E Preferred Stock. Costs associated with the Series E Preferred Stock, such as legal fees and commitment shares are capitalized and reported as deferred financing costs on the Condensed Consolidated Balance Sheets. The total gross debt issuance cost incurred by the Company related to the Series E Preferred Stock was $104,000 . These debt issuance costs will be recognized as additional interest expense over the life of the Series E Preferred Stock. As of December 31, 2017 , all outstanding shares of Series E Preferred Stock, along with all accrued dividends, had either been converted or redeemed. The Company classified the Series E Preferred Stock as a liability pursuant to ASC 480 on the closing date due to the structure of the financing agreement, whereby the Company has an unconditional obligation that the Company may settle by issuing a variable number of common shares with a monetary value that is fixed and known at inception. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Series E Preferred Stock was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At December 31, 2016 the fair value of the derivative liability was $140,748 . At September 30, 2017, the Company recorded the reduction of the remaining embedded derivative associated with the Series E Preferred Stock of $121,390 as a gain in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $140,748 , to properly reflect the elimination of the embedded derivative as of December 31, 2017 . The Committed Equity Line On November 10, 2015, the Company and the private investor entered into a committed equity line purchase agreement (the "CEL"). Under the terms and subject to the conditions of the CEL purchase agreement, at its option the Company has the right to sell to the private investor, and the private investor is obligated to purchase from the Company, up to $32.2 million of the Company’s common stock, subject to certain limitations, from time to time, over the 36 -month period commencing on December 18, 2015, the date that the registration statement was declared effective by the SEC. From time to time, the Company may direct the private investor, at its sole discretion and subject to certain conditions, to purchase an amount of shares of common stock up to the lesser of (i) $1,000,000 or (ii) 300% of the average daily trading volume of the Company’s common stock over the preceding ten trading day period. The per share purchase price for shares of common stock to be sold by the Company under the CEL purchase agreement shall be equal to 80% of the average of the two lowest VWAPs of the common stock for the ten consecutive trading day period prior to the purchase date. In total, the Company directed the private investor to purchase $3,056,147 of common stock which resulted in the issuance of 1,368,000 shares of common stock. The Company may not direct the private investor to purchase shares of common stock more frequently than once each ten business days. The Company’s sales of shares of common stock to the private investor under the CEL purchase agreement are limited to no more than the number of shares that would result in the beneficial ownership by the private investor and its affiliates, at any single point in time, of more than 9.99% of the Company’s then outstanding shares of common stock. As consideration for entering into the CEL purchase agreement, the Company agreed to issue to the private investor 132,000 shares of common stock (the “Commitment Shares”). The Commitment Shares were issued to the private investor commencing upon the date that the registration statement was declared effective by the SEC. While not officially terminated, the CEL is no longer active and the Company does not consider this a viable source of capital. SERIES F PREFERRED STOCK On January 19, 2016 , the Company entered into a securities purchase agreement with a private investor for the sale of $7,000,000 of the Company’s newly designated Series F Preferred Stock. On January 20, 2016 , the Company sold and issued 7,000 shares of Series F Preferred Stock to the private investor. The aggregate purchase price of the Series F Preferred shares was $7,000,000 . On January 20, 2016 , the private investor paid $500,000 to the Company. The remaining $6,500,000 was paid by the private investor to the Company in 14 weekly increments of $500,000 or $250,000 beginning January 25, 2016 and ending April 28, 2016 . Shares of the Series F Preferred Stock (including the amount of any accrued and unpaid dividends thereon) are convertible, at the option of the holder, into common stock at a fixed conversion price equal to $5 per share. If certain defined default events occur, the conversion price would thereafter be reduced (and only reduced), to equal 70% of the average of the two lowest VWAPs of our common stock for the twenty consecutive trading day period prior to the conversion date. If requested by the private investor, the Company will make weekly redemptions of shares of Series F Preferred Stock (including any accrued and unpaid dividends thereon). If the redemption price is paid by the Company in cash, the number of shares to be redeemed in each weekly increment is 250 shares of Series F Preferred Stock, and the redemption price is a price per share equal to $1,250 plus any accrued but unpaid dividends thereon. The Company has the option to make such redemption payments in shares of common stock provided certain specified equity conditions are satisfied at the time of payment. The number of shares of common stock to be issued would be calculated using a per share price equal to 80% of the one lowest VWAP of our common stock for the ten consecutive trading day period prior to the payment date. For redemption payments made in shares of common stock, the Company will redeem either (i) 250 shares of Series F Preferred Stock or (ii) such greater number of shares of Series F Preferred Stock (and also including any accrued and unpaid dividends) that would result upon redemption in the issuance of a number of shares of common stock equal to 12% of the aggregate composite trading volume for the Company’s common stock during the preceding calendar week. The private investor had available to them a new conversion price beginning on June 9, 2016 as a result of the Series H Preferred Stock transaction further described in Note 12. Shares of the Series F Preferred Stock are now convertible, at the option of the private investor, into common stock at a variable conversion price equal to 70% of (i) the lowest VWAP of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. Amendment of Outstanding Series F Preferred Stock Conversion Price On October 5, 2016 , the Company filed a Certificate of Amendment to the Certificate of Designations of Preferences, Rights and Limitations of Series F Preferred Stock with the Secretary of State of the State of Delaware. The Certificate of Amendment amends the conversion price at which the Series F Preferred Stock can be converted into shares of common stock. The Company had approximately $336,000 of Series F Preferred Stock remaining outstanding as of October 5, 2016 . As amended, the conversion price will now be equal to the lowest of (i) 50% of the lowest weighted average price (“VWAP”) of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) 50% of the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. If certain “Triggering Events” specified in the terms of the Series F Preferred Stock occur, then the conversion price of the Series F Preferred Stock shall be thereafter reduced, and only reduced, to equal 50% of the average of the lowest traded price of the common stock for the twenty consecutive trading day period prior to the conversion date. The following table summarizes the conversion activity of the Series F Preferred Stock: Conversion Period Principal Converted Dividends Converted Common Shares Issued Q1 2016 $ 2,168,402 $ 19,896 2,183,991 Q2 2016 $ 3,234,000 $ 66,931 6,649,741 Q3 2016 $ 1,261,648 $ 54,096 81,917,367 Q4 2016 $ 175,949 $ 9,168 27,276,006 Q3 2017 $ 20,000 $ — 18,181,818 Q4 2017 $ 107,000 $ 467 172,552,354 $ 6,966,999 $ 150,558 308,761,277 Holders of the Series F Preferred Stock are entitled to dividends in the amount of 7% per annum. As of December 31, 2017 , all shares and accrued dividends had been converted and no balance remained. The Company classified the Series F Preferred Stock as a liability pursuant to ASC 480 on the closing date due to the structure of the financing agreement, whereby the Company has an unconditional obligation that the Company may settle by issuing a variable number of common shares with a monetary value that is fixed and known at inception. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Series F Preferred Stock was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At closing, a derivative liability and a corresponding debt discount in the amount of $1,666,000 were recorded. The debt discount will be charged to interest expense ratably over the life of the Series F Preferred Stock. The derivative balance was $255,324 , as of December 31, 2016 . At December 31, 2017 , the Company recorded the reduction of the remaining embedded derivative associated with the Series F Preferred Stock of $42,347 as a gain in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $255,324 , to properly reflect the elimination of the embedded derivative as of December 31, 2017 . SERIES G PREFERRED STOCK On April 29, 2016 , the Company entered into a securities purchase agreement with private investors to issue 2,000 shares of Series G Preferred Stock for $2,000,000 . The Company issued 2,000 shares of Series G Preferred Stock to the private investors, in various tranches between April and June 2016, resulting in gross proceeds to the Company of $2,000,000 . Holders of the Series G Preferred Stock are entitled to dividends in the amount of 10% per annum. One year after issuance, the Company is required to redeem for cash all or any portion of the outstanding shares of the Series G Preferred Stock at a price per share equal to $1,000 plus any accrued but unpaid dividends thereon. Assignment of Series G Preferred Stock Beginning September 19, 2016 , the two private investors (the “Series G Sellers”) entered into assignment agreements with accredited investors (the “Series G Purchasers”). Under the terms of the assignment agreements, the Series G Sellers may sell all 2,000 outstanding shares of Series G Preferred Stock to the Series G Purchasers for a purchase price of $1,000 per share of Series G Preferred Stock (plus the amount of any accrued and unpaid dividends thereon). During 2016 and 2017, the Series G Sellers had sold 1,795 shares of Series G Preferred Stock, representing a value of $1,795,000 , to the Series G Purchasers. On September 21, 2016 , the Company filed a Certificate of Amendment to the Certificate of Designations of Prefe |
Series K Preferred Stock
Series K Preferred Stock | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Preferred Stock | SERIES H PREFERRED STOCK AND JULY 2016 CONVERTIBLE NOTES Series H Preferred Stock On June 9, 2016 , the Company entered into a securities purchase agreement with a private investor to issue 2,500 shares of Series H Preferred Stock for $2,500,000 . The Company received gross proceeds of $250,000 at Closing. Additional gross proceeds of $580,000 were received by the Company through July 7, 2016. The Company agreed to exchange outstanding Series H Preferred Stock for Senior Secured Convertible Notes (“July 2016 Notes”) on July 13, 2016 . At the date of the exchange, the Company had sold and issued 830 shares of Series H Preferred Stock to the private investor in exchange for $830,000 of gross proceeds. Please see the section below for details of the exchange. July 2016 Convertible Notes On July 13, 2016 , the Company entered into a securities purchase agreement (the “Note SPA”) with the private investor for the private placement of $2,082,600 of the Company’s 4% Original Issue Discount Senior Secured Convertible Promissory Notes (the “July 2016 Convertible Notes”). On July 13, 2016 , the Company sold and issued $364,000 principal amount of notes to the investor in exchange for $350,000 of gross proceeds. The Company sold and issued the remaining $1,718,600 principal amount of July 2016 Convertible Notes to the investor in exchange for $1,650,000 of gross proceeds in weekly tranches between July and September 2016. The Company and the private investor also entered into an Exchange Agreement dated July 13, 2016 (the “Exchange Agreement”). Under the terms of the Exchange Agreement, the outstanding shares of Series H Preferred Stock (approximately $833,000 of capital and accrued dividends) were canceled. In exchange, the Company issued to the private investor approximately $866,000 of July 2016 Convertible Notes. There were 830 shares of Series H Preferred Stock outstanding as of the date of the Exchange Agreement. Unless earlier converted or prepaid, all of the July 2016 Convertible Notes will mature July 13, 2017 . The July 2016 Convertible Notes bear interest at a rate of 10% per annum, subject to increase to 24% per annum upon the occurrence and continuance of an event of default. Principal on the July 2016 Convertible Notes is payable on the Maturity Date. Interest on the July 2016 Convertible Notes is payable quarterly. Principal and interest are payable in cash or, if specified equity conditions are met, shares of Common Stock. The July 2016 Convertible Notes are secured by a security interest in substantially all of the Company’s assets. The subsidiaries of the Company have guaranteed the Company’s obligations under the July 2016 Convertible Notes. The July 2016 Convertible Notes contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the July 2016 Convertible Notes; (ii) bankruptcy or insolvency of the Company; and (iii) failure to file a registration statement by October 9, 2016. On October 10, 2016 the Company had not been successful in filing the registration statement triggering an event of default per the July 2016 Note Agreement. Upon default the interest rate increases to 24% per annum and the holder of the July 2016 Notes has the option to accelerate the Note and demand cash payment of the Mandatory Default Amount consisting of a 25% premium of the principal balance plus any accrued and unpaid interest. The Company began accruing interest at the rate of 24% on October 10, 2016. Forbearance and Settlement Agreement on July 2016 Convertible Notes On May 5, 2017 , the Company entered into a Forbearance and Settlement Agreement ("Forbearance Agreement") with a holder of certain secured convertible notes that are in default due to various triggering events. The holder and the Company agreed to forbear from taking any action provided for under the secured convertible notes in exchange for the following terms provided in this agreement: • The Company agreed to redeem for cash all secured convertible notes of the Company held by the holder no later than September 1, 2017 . • The Company affirmed that the current balance of owed principal and accrued and unpaid interest to the holder is $1,790,214 as of May 2, 2017 . • The redemption price for such secured convertible notes shall be 120% (if redeemed on or prior to August 15, 2017 ) or 125% (if redeemed after August 15, 2017 ) of the then outstanding principal, plus any accrued and unpaid interest. • During the month of May 2017, the Holder agreed to limit its conversions of outstanding Company secured convertible notes to $50,000 per calendar week of principal/interest. • During the months of June, July and August 2017, the holder agreed to limit its conversions of outstanding Company secured convertible notes to $75,000 per calendar week of principal/interest. • During the months of May, June, July and August 2017, the holder agreed that all outstanding Company secured convertible notes shall bear interest at the normal stated rate of 10% , rather than default rate of 24% . • All conversions during the months of May, June, July and August 2017 will be at the “triggering event” discount conversion price as stated in the secured convertible notes, and will continue at the “triggering event” discount price until, if and when the notes are redeemed. • Should the Company fail to redeem for cash all secured convertible notes on or before September 1, 2017 , default interest and normal stated interest will accrue from the date of execution of this agreement. All principal and accrued interest on the July 2016 Convertible Notes are convertible at any time, in whole or in part, at the option of the private investor, into shares of Common Stock at a variable conversion price equal to the lowest of (i) $0.045 (the “Fixed Conversion Price”), (ii) 70% of the lowest volume weighted average price (“VWAP”) of the Company's common stock for the ten consecutive trading day period prior to the conversion date or (iii) 70% of the lowest closing bid price of the Company's common stock for the ten consecutive trading day period prior to the conversion date. If certain defined triggering events occur, the conversion price would thereafter be reduced (and only reduced), to equal 60% of the lower of (i) the lowest closing bid price of the Company's common stock for the thirty consecutive trading day period prior to the conversion date or (ii) the lowest VWAP of the the Company's common stock for the thirty consecutive trading day period prior to the conversion date. In addition, on the 90th day and also on the 180th day from the date of the Note SPA, the private investor may reset the Fixed Conversion Price to thereafter be equal to the VWAP of the Common Stock for such day or if such 90th or 180th day is not a trading day, then the VWAP for the immediately preceding trading day. The following table summarizes the conversion activity on the principal of the July 2106 Convertible Notes: Conversion Period Principal Converted Common Shares Issued Q4 2016 $ 152,460 64,000,000 Q1 2017 1,017,732 959,704,543 Q2 2017 682,235 1,865,043,998 $ 1,852,427 2,888,748,541 In addition to the $1,852,427 in principal conversions, $3,960 of interest was converted during 2017. As of December 31, 2017 , with $1,096,600 of principal payments, $400,017 of interest payments, and $219,320 of redemption penalty payments, the July 2016 Convertible notes had been redeemed in full. The difference in the accrued interest and the paid interest, due to the terms of the settlement agreement, was $22,661 which was credited to interest expense upon full redemption of the instrument. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the July 2016 Convertible Notes was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At December 31, 2016 the fair value of the derivative liability was $3,733,348 . Throughout 2017, the Company recorded the fair value changes of the embedded derivative associated with the July 2016 Convertible Notes as a gain or loss in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $3,733,348 , to properly reflect the elimination of the embedded derivative upon the extinguishment of the liability. OCTOBER 2016 CONVERTIBLE NOTES AND EXCHANGE OF SERIES A PREFERRED STOCK October 2016 Convertible Notes On October 5, 2016 , the Company entered into a securities purchase agreement with a private investor (“Adar Bays”) for the private placement of $330,000 principal amount of October 2016 Convertible Notes. At Closing, the Company sold and issued $330,000 principal amount of October 2016 Convertible Notes to Adar Bays in exchange for $300,000 of gross proceeds. Unless earlier converted or prepaid, the October 2016 Convertible Notes will mature December 31, 2017 (the “Maturity Date”). The October 2016 Convertible Notes bear interest at a rate of 6% per annum, subject to increase to 24% per annum upon the occurrence and continuance of an event of default (as described below). Principal and accrued interest on the October 2016 Convertible Notes is payable on the Maturity Date. All principal and accrued interest on the October 2016 Convertible Notes are convertible at any time, in whole or in part, at the option of Adar Bays, into shares of common stock at a variable conversion price equal to 80% of the lowest closing bid price of the Company’s common stock for the 15 consecutive trading day period prior to the conversion date. After the six month anniversary of the issuance of any October 2016 Convertible Note, the conversion price for such note shall thereafter be equal to 50% of the lowest closing bid price of the Company’s common stock for the 15 consecutive trading day period prior to the conversion date. The October 2016 Convertible Notes contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the October 2016 Convertible Notes; and (ii) bankruptcy or insolvency of the Company. Outstanding principal and accrued interest on the October 2016 Convertible Notes were $330,000 and $24,860 , respectively as of December 31, 2017 . Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the October 2016 Convertible Notes were deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At closing, a derivative liability and a corresponding debt discount in the amount of $330,000 was recorded. The fair value of the derivative was greater than the face value at issuance and the difference of $341,114 was charged to interest expense at issuance. The remaining debt discount will be charged to interest expense ratably over the life of the October 2016 Convertible Notes. As of December 31, 2016 , the fair value of the derivative liability was $544,746 . The derivative liability associated with the October 2016 Convertible Notes is subject to revaluation on a quarterly basis to reflect the market value change of the embedded conversion option. At December 31, 2017 , the Company conducted a fair value assessment of the embedded derivative associated with the October 2016 Convertible Notes. As a result of the fair value assessment, the Company recorded a $279,442 loss as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations for the three months ended December 31, 2017 . The net loss recorded for the year ended December 31, 2017 was $27,897 , to properly reflect the fair value of the embedded derivative of $572,643 as of December 31, 2017 . The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The derivative associated with the October 2016 Convertible Notes approximates management’s estimate of the fair value of the embedded derivative liability at December 31, 2017 based on using a Monte Carlo simulation following a Geometric Brownian Motion with the following assumptions: annual volatility of 65% present value discount rate of 12% and dividend yield of 0% . Exchange of Outstanding Series A Preferred Stock for Convertible Notes In 2013, the Company completed private placement to one accredited investor (the “Series A Holder”) of its Series A Convertible Preferred Stock. Prior to the exchange agreement described below the Company had $165,541 shares of Series A Preferred Stock that remained outstanding as of October 6, 2016 . On October 6, 2016 , the Series A Holder entered into an exchange agreement (the “Exchange Agreement”) with Adar Bays. Pursuant to the exchange agreement, beginning December 5, 2016, Adar Bays has the option to exchange, from time to time, all or any portion of the October 2016 Convertible Notes for outstanding shares of Series A Preferred Stock from the Series A Holder. As of March 31, 2017, Adar Bays had elected to exchange all outstanding October 2016 Convertible Notes, in accordance with the exchange agreement, and the Series A Holder held $330,000 of the October 2016 Convertible Notes. SERIES A PREFERRED STOCK In June 2013, the Company entered into a Securities Purchase Agreement with an investor to sell an aggregate of 750,000 shares of Series A Preferred Stock at a price of $8 per share, resulting in gross proceeds of $6,000,000 . This purchase agreement included warrants to purchase up to 13,125 shares of common stock of the Company. The transfer of cash and securities took place incrementally, the first closing occurring on June 17, 2013 with the transfer of 125,000 shares of Series A Preferred Stock and a warrant to purchase 2,187 shares of common stock for $1,000,000 . The final closings took place in August 2013, with the transfer of 625,000 shares of Series A Preferred Stock and a warrant to purchase 10,938 shares of common stock for $5,000,000 . Holders of Series A Preferred Stock are entitled to cumulative dividends at a rate of 8% per annum when and if declared by the Board of Directors in its sole discretion. The dividends may be paid in cash or in the form of common stock (valued at 10% below market price, but not to exceed the lowest closing price during the applicable measurement period), at the discretion of the Board of Directors. The dividend rate on the Series A Preferred Stock is indexed to the Company's stock price and subject to adjustment. In addition, the Series A Preferred Stock contains a make-whole provision whereby, conversion or redemption of the preferred stock within 4 years of issuance will require dividends for the full four year period to be paid by the Company in cash or common stock (valued at 10% below market price, but not to exceed the lowest closing price during the applicable measurement period). This make-whole provision expired in June 2017 and future conversions and redemptions will be paid out with accrued dividends per the holding period of the shares of Series A Preferred stock. Please see Note 23 for more information. The Series A Preferred Stock may be converted into shares of common stock at the option of the Company if the closing price of the common stock exceeds $232 , as adjusted, for 20 consecutive trading days, or by the holder at any time. The Company has the right to redeem the Series A Preferred Stock at a price of $8 per share, plus any accrued and unpaid dividends, plus the make-whole amount (if applicable). At December 31, 2017 , the preferred shares were not eligible for conversion to common shares at the option of the Company. The holder of the preferred shares may convert to common shares at any time, at no cost, at a ratio of 1 preferred share into 1 common share (subject to standard ratable anti-dilution adjustments). Upon any conversion (whether at the option of the Company or the holder), the holder is entitled to receive any accrued but unpaid dividends. On October 6, 2016, the Series A Holder entered into an exchange agreement (the “Exchange Agreement”) with Adar Bays. Pursuant to the exchange agreement, beginning December 5, 2016, Adar Bays has the option to exchange, from time to time, all or any portion of the October 2016 Convertible Notes (see Note 13) for outstanding shares of Series A Preferred Stock from the Series A Holder. As of December 31, 2017 , Adar Bays had elected to exchange all outstanding October 2016 Convertible Notes, in accordance with the exchange agreement, resulting in the exchange of 104,785 shares of Series A Preferred Stock. As of December 31, 2017 , Adar Bays had also converted their 104,785 shares of Series A Preferred Stock, and the related make whole dividend, which resulted in the issuance of 173,946,250 shares of common stock. Except as otherwise required by law (or with respect to approval of certain actions), the Series A Preferred Stock shall have no voting rights. Upon any liquidation, dissolution or winding up of the Company, after payment or provision for payment of debts and other liabilities of the Company, the holders of Series A Preferred Stock shall be entitled to receive, pari passu with any distribution to the holders of common stock of the Company, an amount equal to $8 per share of Series A Preferred Stock plus any accrued and unpaid dividends. As of December 31, 2017 , there were 60,756 shares of Series A Preferred Stock outstanding and accrued and unpaid dividends of $279,815 . SERIES E PREFERRED STOCK AND THE COMMITTED EQUITY LINE Series E Preferred Stock On November 4, 2015 , the Company entered into a securities purchase agreement with a private investor to issue 2,800 shares of Series E Preferred Stock in exchange for $2,800,000 . Shares of the Series E Preferred Stock (including the amount of any accrued and unpaid dividends thereon) are convertible, at the option of the holder, into common stock at a variable conversion price equal to 80% of the average of the two lowest VWAPs of the Company's common stock for the ten consecutive trading day period prior to the conversion date. If certain defined default events occur, the conversion price would thereafter be reduced (and only reduced), to equal 70% of the average of the two lowest VWAPs of the Company's common stock for the twenty consecutive trading day period prior to the conversion date. The private investor had available to them a new conversion price beginning on June 9, 2016 as a result of the Series H Preferred Stock transaction further described in Note 12. Shares of the Series E Preferred Stock are now convertible, at the option of the private investor, into common stock at a variable conversion price equal to 70% of (i) the lowest VWAP of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. The following table summarizes the conversion activity of the Series E Preferred Stock: Conversion Period Preferred Series E Shares Converted Value of Series E Preferred Shares (inclusive of accrued dividends) Common Shares Issued Q4 2015 478 $ 481,500 250,000 Q1 2016 1,220 1,239,436 1,132,000 Q2 2016 365 381,414 7,979,568 Q3 2016 523 548,896 21,973,747 Q4 2016 94 101,018 13,089,675 Q1 2017 15 16,248 8,289,962 Q2 2017 35 38,886 134,927,207 Q3 2017 70 76,814 129,314,677 2,800 $ 2,884,212 316,956,836 Holders of the Series E Preferred Stock will be entitled to dividends in the amount of 7% per annum. During the year ended December 31, 2017 , the holder converted dividends in the amount of $11,948 on the Series E Preferred Stock, resulting in the issuance of 25,160,171 shares of common stock. On September 30, 2017, the Company paid $2,013 in cash for the remaining accrued dividends. The Company has issued 18,000 shares of common stock to the private investor as a commitment fee relating to the Series E Preferred Stock. Costs associated with the Series E Preferred Stock, such as legal fees and commitment shares are capitalized and reported as deferred financing costs on the Condensed Consolidated Balance Sheets. The total gross debt issuance cost incurred by the Company related to the Series E Preferred Stock was $104,000 . These debt issuance costs will be recognized as additional interest expense over the life of the Series E Preferred Stock. As of December 31, 2017 , all outstanding shares of Series E Preferred Stock, along with all accrued dividends, had either been converted or redeemed. The Company classified the Series E Preferred Stock as a liability pursuant to ASC 480 on the closing date due to the structure of the financing agreement, whereby the Company has an unconditional obligation that the Company may settle by issuing a variable number of common shares with a monetary value that is fixed and known at inception. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Series E Preferred Stock was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At December 31, 2016 the fair value of the derivative liability was $140,748 . At September 30, 2017, the Company recorded the reduction of the remaining embedded derivative associated with the Series E Preferred Stock of $121,390 as a gain in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $140,748 , to properly reflect the elimination of the embedded derivative as of December 31, 2017 . The Committed Equity Line On November 10, 2015, the Company and the private investor entered into a committed equity line purchase agreement (the "CEL"). Under the terms and subject to the conditions of the CEL purchase agreement, at its option the Company has the right to sell to the private investor, and the private investor is obligated to purchase from the Company, up to $32.2 million of the Company’s common stock, subject to certain limitations, from time to time, over the 36 -month period commencing on December 18, 2015, the date that the registration statement was declared effective by the SEC. From time to time, the Company may direct the private investor, at its sole discretion and subject to certain conditions, to purchase an amount of shares of common stock up to the lesser of (i) $1,000,000 or (ii) 300% of the average daily trading volume of the Company’s common stock over the preceding ten trading day period. The per share purchase price for shares of common stock to be sold by the Company under the CEL purchase agreement shall be equal to 80% of the average of the two lowest VWAPs of the common stock for the ten consecutive trading day period prior to the purchase date. In total, the Company directed the private investor to purchase $3,056,147 of common stock which resulted in the issuance of 1,368,000 shares of common stock. The Company may not direct the private investor to purchase shares of common stock more frequently than once each ten business days. The Company’s sales of shares of common stock to the private investor under the CEL purchase agreement are limited to no more than the number of shares that would result in the beneficial ownership by the private investor and its affiliates, at any single point in time, of more than 9.99% of the Company’s then outstanding shares of common stock. As consideration for entering into the CEL purchase agreement, the Company agreed to issue to the private investor 132,000 shares of common stock (the “Commitment Shares”). The Commitment Shares were issued to the private investor commencing upon the date that the registration statement was declared effective by the SEC. While not officially terminated, the CEL is no longer active and the Company does not consider this a viable source of capital. SERIES F PREFERRED STOCK On January 19, 2016 , the Company entered into a securities purchase agreement with a private investor for the sale of $7,000,000 of the Company’s newly designated Series F Preferred Stock. On January 20, 2016 , the Company sold and issued 7,000 shares of Series F Preferred Stock to the private investor. The aggregate purchase price of the Series F Preferred shares was $7,000,000 . On January 20, 2016 , the private investor paid $500,000 to the Company. The remaining $6,500,000 was paid by the private investor to the Company in 14 weekly increments of $500,000 or $250,000 beginning January 25, 2016 and ending April 28, 2016 . Shares of the Series F Preferred Stock (including the amount of any accrued and unpaid dividends thereon) are convertible, at the option of the holder, into common stock at a fixed conversion price equal to $5 per share. If certain defined default events occur, the conversion price would thereafter be reduced (and only reduced), to equal 70% of the average of the two lowest VWAPs of our common stock for the twenty consecutive trading day period prior to the conversion date. If requested by the private investor, the Company will make weekly redemptions of shares of Series F Preferred Stock (including any accrued and unpaid dividends thereon). If the redemption price is paid by the Company in cash, the number of shares to be redeemed in each weekly increment is 250 shares of Series F Preferred Stock, and the redemption price is a price per share equal to $1,250 plus any accrued but unpaid dividends thereon. The Company has the option to make such redemption payments in shares of common stock provided certain specified equity conditions are satisfied at the time of payment. The number of shares of common stock to be issued would be calculated using a per share price equal to 80% of the one lowest VWAP of our common stock for the ten consecutive trading day period prior to the payment date. For redemption payments made in shares of common stock, the Company will redeem either (i) 250 shares of Series F Preferred Stock or (ii) such greater number of shares of Series F Preferred Stock (and also including any accrued and unpaid dividends) that would result upon redemption in the issuance of a number of shares of common stock equal to 12% of the aggregate composite trading volume for the Company’s common stock during the preceding calendar week. The private investor had available to them a new conversion price beginning on June 9, 2016 as a result of the Series H Preferred Stock transaction further described in Note 12. Shares of the Series F Preferred Stock are now convertible, at the option of the private investor, into common stock at a variable conversion price equal to 70% of (i) the lowest VWAP of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. Amendment of Outstanding Series F Preferred Stock Conversion Price On October 5, 2016 , the Company filed a Certificate of Amendment to the Certificate of Designations of Preferences, Rights and Limitations of Series F Preferred Stock with the Secretary of State of the State of Delaware. The Certificate of Amendment amends the conversion price at which the Series F Preferred Stock can be converted into shares of common stock. The Company had approximately $336,000 of Series F Preferred Stock remaining outstanding as of October 5, 2016 . As amended, the conversion price will now be equal to the lowest of (i) 50% of the lowest weighted average price (“VWAP”) of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) 50% of the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. If certain “Triggering Events” specified in the terms of the Series F Preferred Stock occur, then the conversion price of the Series F Preferred Stock shall be thereafter reduced, and only reduced, to equal 50% of the average of the lowest traded price of the common stock for the twenty consecutive trading day period prior to the conversion date. The following table summarizes the conversion activity of the Series F Preferred Stock: Conversion Period Principal Converted Dividends Converted Common Shares Issued Q1 2016 $ 2,168,402 $ 19,896 2,183,991 Q2 2016 $ 3,234,000 $ 66,931 6,649,741 Q3 2016 $ 1,261,648 $ 54,096 81,917,367 Q4 2016 $ 175,949 $ 9,168 27,276,006 Q3 2017 $ 20,000 $ — 18,181,818 Q4 2017 $ 107,000 $ 467 172,552,354 $ 6,966,999 $ 150,558 308,761,277 Holders of the Series F Preferred Stock are entitled to dividends in the amount of 7% per annum. As of December 31, 2017 , all shares and accrued dividends had been converted and no balance remained. The Company classified the Series F Preferred Stock as a liability pursuant to ASC 480 on the closing date due to the structure of the financing agreement, whereby the Company has an unconditional obligation that the Company may settle by issuing a variable number of common shares with a monetary value that is fixed and known at inception. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Series F Preferred Stock was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At closing, a derivative liability and a corresponding debt discount in the amount of $1,666,000 were recorded. The debt discount will be charged to interest expense ratably over the life of the Series F Preferred Stock. The derivative balance was $255,324 , as of December 31, 2016 . At December 31, 2017 , the Company recorded the reduction of the remaining embedded derivative associated with the Series F Preferred Stock of $42,347 as a gain in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $255,324 , to properly reflect the elimination of the embedded derivative as of December 31, 2017 . SERIES G PREFERRED STOCK On April 29, 2016 , the Company entered into a securities purchase agreement with private investors to issue 2,000 shares of Series G Preferred Stock for $2,000,000 . The Company issued 2,000 shares of Series G Preferred Stock to the private investors, in various tranches between April and June 2016, resulting in gross proceeds to the Company of $2,000,000 . Holders of the Series G Preferred Stock are entitled to dividends in the amount of 10% per annum. One year after issuance, the Company is required to redeem for cash all or any portion of the outstanding shares of the Series G Preferred Stock at a price per share equal to $1,000 plus any accrued but unpaid dividends thereon. Assignment of Series G Preferred Stock Beginning September 19, 2016 , the two private investors (the “Series G Sellers”) entered into assignment agreements with accredited investors (the “Series G Purchasers”). Under the terms of the assignment agreements, the Series G Sellers may sell all 2,000 outstanding shares of Series G Preferred Stock to the Series G Purchasers for a purchase price of $1,000 per share of Series G Preferred Stock (plus the amount of any accrued and unpaid dividends thereon). During 2016 and 2017, the Series G Sellers had sold 1,795 shares of Series G Preferred Stock, representing a value of $1,795,000 , to the Series G Purchasers. On September 21, 2016 , the Company filed a Certificate of Amendment to the Certificate of Designations of Prefe |
Make-Whole Dividend Liability
Make-Whole Dividend Liability | 12 Months Ended |
Dec. 31, 2017 | |
Make-whole dividend liability [Abstract] | |
Make-Whole Dividend Liability | MAKE-WHOLE DIVIDEND LIABILITY In June 2013, the Company entered into a Series A Preferred Stock Purchase Agreement. Holders of Series A Preferred Stock are entitled to cumulative dividends at a rate of 8% per annum, with the dividend rate being indexed to the Company's stock price and subject to adjustment. Conversion or redemption of the Series A Preferred Stock within four years of issuance requires the Company pay a make-whole dividend to the holders, whereby dividends for the full four year period are to be paid in cash or common stock (valued at 10% below market price). The Company concluded the make-whole dividends should be characterized as embedded derivatives under ASC 815. The make-whole dividends were expensed at the time of issuance and recorded as "Make-whole dividend liability" in the Condensed Consolidated Balance Sheets. The fair value of these dividend liabilities, which are indexed to the Company's common stock, must be evaluated at each period end. The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The fair value determination required forecasting stock price volatility, expected average annual return and conversion date. Between December 2016 and March 2017, a Preferred Series A holder converted 104,785 shares of Series A Preferred Stock, and the related make whole dividend of $419,140 , which resulted in the issuance of 173,946,250 shares of common stock. On June 17, 2017 , the make-whole dividend reached maturity. As such, the Company eliminated the Make-Whole derivative liability, moving the remaining balance of $274,583 to accrued interest and dividends, and began accruing additional dividends on the Series A Preferred Stock as they occur. Please refer to Note 16 for further information on the Series A Preferred Stock and the associated accrued and unpaid dividends. |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Stockholders' Equity (Deficit) | SERIES H PREFERRED STOCK AND JULY 2016 CONVERTIBLE NOTES Series H Preferred Stock On June 9, 2016 , the Company entered into a securities purchase agreement with a private investor to issue 2,500 shares of Series H Preferred Stock for $2,500,000 . The Company received gross proceeds of $250,000 at Closing. Additional gross proceeds of $580,000 were received by the Company through July 7, 2016. The Company agreed to exchange outstanding Series H Preferred Stock for Senior Secured Convertible Notes (“July 2016 Notes”) on July 13, 2016 . At the date of the exchange, the Company had sold and issued 830 shares of Series H Preferred Stock to the private investor in exchange for $830,000 of gross proceeds. Please see the section below for details of the exchange. July 2016 Convertible Notes On July 13, 2016 , the Company entered into a securities purchase agreement (the “Note SPA”) with the private investor for the private placement of $2,082,600 of the Company’s 4% Original Issue Discount Senior Secured Convertible Promissory Notes (the “July 2016 Convertible Notes”). On July 13, 2016 , the Company sold and issued $364,000 principal amount of notes to the investor in exchange for $350,000 of gross proceeds. The Company sold and issued the remaining $1,718,600 principal amount of July 2016 Convertible Notes to the investor in exchange for $1,650,000 of gross proceeds in weekly tranches between July and September 2016. The Company and the private investor also entered into an Exchange Agreement dated July 13, 2016 (the “Exchange Agreement”). Under the terms of the Exchange Agreement, the outstanding shares of Series H Preferred Stock (approximately $833,000 of capital and accrued dividends) were canceled. In exchange, the Company issued to the private investor approximately $866,000 of July 2016 Convertible Notes. There were 830 shares of Series H Preferred Stock outstanding as of the date of the Exchange Agreement. Unless earlier converted or prepaid, all of the July 2016 Convertible Notes will mature July 13, 2017 . The July 2016 Convertible Notes bear interest at a rate of 10% per annum, subject to increase to 24% per annum upon the occurrence and continuance of an event of default. Principal on the July 2016 Convertible Notes is payable on the Maturity Date. Interest on the July 2016 Convertible Notes is payable quarterly. Principal and interest are payable in cash or, if specified equity conditions are met, shares of Common Stock. The July 2016 Convertible Notes are secured by a security interest in substantially all of the Company’s assets. The subsidiaries of the Company have guaranteed the Company’s obligations under the July 2016 Convertible Notes. The July 2016 Convertible Notes contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the July 2016 Convertible Notes; (ii) bankruptcy or insolvency of the Company; and (iii) failure to file a registration statement by October 9, 2016. On October 10, 2016 the Company had not been successful in filing the registration statement triggering an event of default per the July 2016 Note Agreement. Upon default the interest rate increases to 24% per annum and the holder of the July 2016 Notes has the option to accelerate the Note and demand cash payment of the Mandatory Default Amount consisting of a 25% premium of the principal balance plus any accrued and unpaid interest. The Company began accruing interest at the rate of 24% on October 10, 2016. Forbearance and Settlement Agreement on July 2016 Convertible Notes On May 5, 2017 , the Company entered into a Forbearance and Settlement Agreement ("Forbearance Agreement") with a holder of certain secured convertible notes that are in default due to various triggering events. The holder and the Company agreed to forbear from taking any action provided for under the secured convertible notes in exchange for the following terms provided in this agreement: • The Company agreed to redeem for cash all secured convertible notes of the Company held by the holder no later than September 1, 2017 . • The Company affirmed that the current balance of owed principal and accrued and unpaid interest to the holder is $1,790,214 as of May 2, 2017 . • The redemption price for such secured convertible notes shall be 120% (if redeemed on or prior to August 15, 2017 ) or 125% (if redeemed after August 15, 2017 ) of the then outstanding principal, plus any accrued and unpaid interest. • During the month of May 2017, the Holder agreed to limit its conversions of outstanding Company secured convertible notes to $50,000 per calendar week of principal/interest. • During the months of June, July and August 2017, the holder agreed to limit its conversions of outstanding Company secured convertible notes to $75,000 per calendar week of principal/interest. • During the months of May, June, July and August 2017, the holder agreed that all outstanding Company secured convertible notes shall bear interest at the normal stated rate of 10% , rather than default rate of 24% . • All conversions during the months of May, June, July and August 2017 will be at the “triggering event” discount conversion price as stated in the secured convertible notes, and will continue at the “triggering event” discount price until, if and when the notes are redeemed. • Should the Company fail to redeem for cash all secured convertible notes on or before September 1, 2017 , default interest and normal stated interest will accrue from the date of execution of this agreement. All principal and accrued interest on the July 2016 Convertible Notes are convertible at any time, in whole or in part, at the option of the private investor, into shares of Common Stock at a variable conversion price equal to the lowest of (i) $0.045 (the “Fixed Conversion Price”), (ii) 70% of the lowest volume weighted average price (“VWAP”) of the Company's common stock for the ten consecutive trading day period prior to the conversion date or (iii) 70% of the lowest closing bid price of the Company's common stock for the ten consecutive trading day period prior to the conversion date. If certain defined triggering events occur, the conversion price would thereafter be reduced (and only reduced), to equal 60% of the lower of (i) the lowest closing bid price of the Company's common stock for the thirty consecutive trading day period prior to the conversion date or (ii) the lowest VWAP of the the Company's common stock for the thirty consecutive trading day period prior to the conversion date. In addition, on the 90th day and also on the 180th day from the date of the Note SPA, the private investor may reset the Fixed Conversion Price to thereafter be equal to the VWAP of the Common Stock for such day or if such 90th or 180th day is not a trading day, then the VWAP for the immediately preceding trading day. The following table summarizes the conversion activity on the principal of the July 2106 Convertible Notes: Conversion Period Principal Converted Common Shares Issued Q4 2016 $ 152,460 64,000,000 Q1 2017 1,017,732 959,704,543 Q2 2017 682,235 1,865,043,998 $ 1,852,427 2,888,748,541 In addition to the $1,852,427 in principal conversions, $3,960 of interest was converted during 2017. As of December 31, 2017 , with $1,096,600 of principal payments, $400,017 of interest payments, and $219,320 of redemption penalty payments, the July 2016 Convertible notes had been redeemed in full. The difference in the accrued interest and the paid interest, due to the terms of the settlement agreement, was $22,661 which was credited to interest expense upon full redemption of the instrument. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the July 2016 Convertible Notes was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At December 31, 2016 the fair value of the derivative liability was $3,733,348 . Throughout 2017, the Company recorded the fair value changes of the embedded derivative associated with the July 2016 Convertible Notes as a gain or loss in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $3,733,348 , to properly reflect the elimination of the embedded derivative upon the extinguishment of the liability. OCTOBER 2016 CONVERTIBLE NOTES AND EXCHANGE OF SERIES A PREFERRED STOCK October 2016 Convertible Notes On October 5, 2016 , the Company entered into a securities purchase agreement with a private investor (“Adar Bays”) for the private placement of $330,000 principal amount of October 2016 Convertible Notes. At Closing, the Company sold and issued $330,000 principal amount of October 2016 Convertible Notes to Adar Bays in exchange for $300,000 of gross proceeds. Unless earlier converted or prepaid, the October 2016 Convertible Notes will mature December 31, 2017 (the “Maturity Date”). The October 2016 Convertible Notes bear interest at a rate of 6% per annum, subject to increase to 24% per annum upon the occurrence and continuance of an event of default (as described below). Principal and accrued interest on the October 2016 Convertible Notes is payable on the Maturity Date. All principal and accrued interest on the October 2016 Convertible Notes are convertible at any time, in whole or in part, at the option of Adar Bays, into shares of common stock at a variable conversion price equal to 80% of the lowest closing bid price of the Company’s common stock for the 15 consecutive trading day period prior to the conversion date. After the six month anniversary of the issuance of any October 2016 Convertible Note, the conversion price for such note shall thereafter be equal to 50% of the lowest closing bid price of the Company’s common stock for the 15 consecutive trading day period prior to the conversion date. The October 2016 Convertible Notes contain standard and customary events of default including but not limited to: (i) failure to make payments when due under the October 2016 Convertible Notes; and (ii) bankruptcy or insolvency of the Company. Outstanding principal and accrued interest on the October 2016 Convertible Notes were $330,000 and $24,860 , respectively as of December 31, 2017 . Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the October 2016 Convertible Notes were deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At closing, a derivative liability and a corresponding debt discount in the amount of $330,000 was recorded. The fair value of the derivative was greater than the face value at issuance and the difference of $341,114 was charged to interest expense at issuance. The remaining debt discount will be charged to interest expense ratably over the life of the October 2016 Convertible Notes. As of December 31, 2016 , the fair value of the derivative liability was $544,746 . The derivative liability associated with the October 2016 Convertible Notes is subject to revaluation on a quarterly basis to reflect the market value change of the embedded conversion option. At December 31, 2017 , the Company conducted a fair value assessment of the embedded derivative associated with the October 2016 Convertible Notes. As a result of the fair value assessment, the Company recorded a $279,442 loss as "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations for the three months ended December 31, 2017 . The net loss recorded for the year ended December 31, 2017 was $27,897 , to properly reflect the fair value of the embedded derivative of $572,643 as of December 31, 2017 . The fair value measurements rely primarily on Company-specific inputs and the Company’s own assumptions. With the absence of observable inputs, the Company determined these recurring fair value measurements reside primarily within Level 3 of the fair value hierarchy. The derivative associated with the October 2016 Convertible Notes approximates management’s estimate of the fair value of the embedded derivative liability at December 31, 2017 based on using a Monte Carlo simulation following a Geometric Brownian Motion with the following assumptions: annual volatility of 65% present value discount rate of 12% and dividend yield of 0% . Exchange of Outstanding Series A Preferred Stock for Convertible Notes In 2013, the Company completed private placement to one accredited investor (the “Series A Holder”) of its Series A Convertible Preferred Stock. Prior to the exchange agreement described below the Company had $165,541 shares of Series A Preferred Stock that remained outstanding as of October 6, 2016 . On October 6, 2016 , the Series A Holder entered into an exchange agreement (the “Exchange Agreement”) with Adar Bays. Pursuant to the exchange agreement, beginning December 5, 2016, Adar Bays has the option to exchange, from time to time, all or any portion of the October 2016 Convertible Notes for outstanding shares of Series A Preferred Stock from the Series A Holder. As of March 31, 2017, Adar Bays had elected to exchange all outstanding October 2016 Convertible Notes, in accordance with the exchange agreement, and the Series A Holder held $330,000 of the October 2016 Convertible Notes. SERIES A PREFERRED STOCK In June 2013, the Company entered into a Securities Purchase Agreement with an investor to sell an aggregate of 750,000 shares of Series A Preferred Stock at a price of $8 per share, resulting in gross proceeds of $6,000,000 . This purchase agreement included warrants to purchase up to 13,125 shares of common stock of the Company. The transfer of cash and securities took place incrementally, the first closing occurring on June 17, 2013 with the transfer of 125,000 shares of Series A Preferred Stock and a warrant to purchase 2,187 shares of common stock for $1,000,000 . The final closings took place in August 2013, with the transfer of 625,000 shares of Series A Preferred Stock and a warrant to purchase 10,938 shares of common stock for $5,000,000 . Holders of Series A Preferred Stock are entitled to cumulative dividends at a rate of 8% per annum when and if declared by the Board of Directors in its sole discretion. The dividends may be paid in cash or in the form of common stock (valued at 10% below market price, but not to exceed the lowest closing price during the applicable measurement period), at the discretion of the Board of Directors. The dividend rate on the Series A Preferred Stock is indexed to the Company's stock price and subject to adjustment. In addition, the Series A Preferred Stock contains a make-whole provision whereby, conversion or redemption of the preferred stock within 4 years of issuance will require dividends for the full four year period to be paid by the Company in cash or common stock (valued at 10% below market price, but not to exceed the lowest closing price during the applicable measurement period). This make-whole provision expired in June 2017 and future conversions and redemptions will be paid out with accrued dividends per the holding period of the shares of Series A Preferred stock. Please see Note 23 for more information. The Series A Preferred Stock may be converted into shares of common stock at the option of the Company if the closing price of the common stock exceeds $232 , as adjusted, for 20 consecutive trading days, or by the holder at any time. The Company has the right to redeem the Series A Preferred Stock at a price of $8 per share, plus any accrued and unpaid dividends, plus the make-whole amount (if applicable). At December 31, 2017 , the preferred shares were not eligible for conversion to common shares at the option of the Company. The holder of the preferred shares may convert to common shares at any time, at no cost, at a ratio of 1 preferred share into 1 common share (subject to standard ratable anti-dilution adjustments). Upon any conversion (whether at the option of the Company or the holder), the holder is entitled to receive any accrued but unpaid dividends. On October 6, 2016, the Series A Holder entered into an exchange agreement (the “Exchange Agreement”) with Adar Bays. Pursuant to the exchange agreement, beginning December 5, 2016, Adar Bays has the option to exchange, from time to time, all or any portion of the October 2016 Convertible Notes (see Note 13) for outstanding shares of Series A Preferred Stock from the Series A Holder. As of December 31, 2017 , Adar Bays had elected to exchange all outstanding October 2016 Convertible Notes, in accordance with the exchange agreement, resulting in the exchange of 104,785 shares of Series A Preferred Stock. As of December 31, 2017 , Adar Bays had also converted their 104,785 shares of Series A Preferred Stock, and the related make whole dividend, which resulted in the issuance of 173,946,250 shares of common stock. Except as otherwise required by law (or with respect to approval of certain actions), the Series A Preferred Stock shall have no voting rights. Upon any liquidation, dissolution or winding up of the Company, after payment or provision for payment of debts and other liabilities of the Company, the holders of Series A Preferred Stock shall be entitled to receive, pari passu with any distribution to the holders of common stock of the Company, an amount equal to $8 per share of Series A Preferred Stock plus any accrued and unpaid dividends. As of December 31, 2017 , there were 60,756 shares of Series A Preferred Stock outstanding and accrued and unpaid dividends of $279,815 . SERIES E PREFERRED STOCK AND THE COMMITTED EQUITY LINE Series E Preferred Stock On November 4, 2015 , the Company entered into a securities purchase agreement with a private investor to issue 2,800 shares of Series E Preferred Stock in exchange for $2,800,000 . Shares of the Series E Preferred Stock (including the amount of any accrued and unpaid dividends thereon) are convertible, at the option of the holder, into common stock at a variable conversion price equal to 80% of the average of the two lowest VWAPs of the Company's common stock for the ten consecutive trading day period prior to the conversion date. If certain defined default events occur, the conversion price would thereafter be reduced (and only reduced), to equal 70% of the average of the two lowest VWAPs of the Company's common stock for the twenty consecutive trading day period prior to the conversion date. The private investor had available to them a new conversion price beginning on June 9, 2016 as a result of the Series H Preferred Stock transaction further described in Note 12. Shares of the Series E Preferred Stock are now convertible, at the option of the private investor, into common stock at a variable conversion price equal to 70% of (i) the lowest VWAP of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. The following table summarizes the conversion activity of the Series E Preferred Stock: Conversion Period Preferred Series E Shares Converted Value of Series E Preferred Shares (inclusive of accrued dividends) Common Shares Issued Q4 2015 478 $ 481,500 250,000 Q1 2016 1,220 1,239,436 1,132,000 Q2 2016 365 381,414 7,979,568 Q3 2016 523 548,896 21,973,747 Q4 2016 94 101,018 13,089,675 Q1 2017 15 16,248 8,289,962 Q2 2017 35 38,886 134,927,207 Q3 2017 70 76,814 129,314,677 2,800 $ 2,884,212 316,956,836 Holders of the Series E Preferred Stock will be entitled to dividends in the amount of 7% per annum. During the year ended December 31, 2017 , the holder converted dividends in the amount of $11,948 on the Series E Preferred Stock, resulting in the issuance of 25,160,171 shares of common stock. On September 30, 2017, the Company paid $2,013 in cash for the remaining accrued dividends. The Company has issued 18,000 shares of common stock to the private investor as a commitment fee relating to the Series E Preferred Stock. Costs associated with the Series E Preferred Stock, such as legal fees and commitment shares are capitalized and reported as deferred financing costs on the Condensed Consolidated Balance Sheets. The total gross debt issuance cost incurred by the Company related to the Series E Preferred Stock was $104,000 . These debt issuance costs will be recognized as additional interest expense over the life of the Series E Preferred Stock. As of December 31, 2017 , all outstanding shares of Series E Preferred Stock, along with all accrued dividends, had either been converted or redeemed. The Company classified the Series E Preferred Stock as a liability pursuant to ASC 480 on the closing date due to the structure of the financing agreement, whereby the Company has an unconditional obligation that the Company may settle by issuing a variable number of common shares with a monetary value that is fixed and known at inception. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Series E Preferred Stock was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At December 31, 2016 the fair value of the derivative liability was $140,748 . At September 30, 2017, the Company recorded the reduction of the remaining embedded derivative associated with the Series E Preferred Stock of $121,390 as a gain in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $140,748 , to properly reflect the elimination of the embedded derivative as of December 31, 2017 . The Committed Equity Line On November 10, 2015, the Company and the private investor entered into a committed equity line purchase agreement (the "CEL"). Under the terms and subject to the conditions of the CEL purchase agreement, at its option the Company has the right to sell to the private investor, and the private investor is obligated to purchase from the Company, up to $32.2 million of the Company’s common stock, subject to certain limitations, from time to time, over the 36 -month period commencing on December 18, 2015, the date that the registration statement was declared effective by the SEC. From time to time, the Company may direct the private investor, at its sole discretion and subject to certain conditions, to purchase an amount of shares of common stock up to the lesser of (i) $1,000,000 or (ii) 300% of the average daily trading volume of the Company’s common stock over the preceding ten trading day period. The per share purchase price for shares of common stock to be sold by the Company under the CEL purchase agreement shall be equal to 80% of the average of the two lowest VWAPs of the common stock for the ten consecutive trading day period prior to the purchase date. In total, the Company directed the private investor to purchase $3,056,147 of common stock which resulted in the issuance of 1,368,000 shares of common stock. The Company may not direct the private investor to purchase shares of common stock more frequently than once each ten business days. The Company’s sales of shares of common stock to the private investor under the CEL purchase agreement are limited to no more than the number of shares that would result in the beneficial ownership by the private investor and its affiliates, at any single point in time, of more than 9.99% of the Company’s then outstanding shares of common stock. As consideration for entering into the CEL purchase agreement, the Company agreed to issue to the private investor 132,000 shares of common stock (the “Commitment Shares”). The Commitment Shares were issued to the private investor commencing upon the date that the registration statement was declared effective by the SEC. While not officially terminated, the CEL is no longer active and the Company does not consider this a viable source of capital. SERIES F PREFERRED STOCK On January 19, 2016 , the Company entered into a securities purchase agreement with a private investor for the sale of $7,000,000 of the Company’s newly designated Series F Preferred Stock. On January 20, 2016 , the Company sold and issued 7,000 shares of Series F Preferred Stock to the private investor. The aggregate purchase price of the Series F Preferred shares was $7,000,000 . On January 20, 2016 , the private investor paid $500,000 to the Company. The remaining $6,500,000 was paid by the private investor to the Company in 14 weekly increments of $500,000 or $250,000 beginning January 25, 2016 and ending April 28, 2016 . Shares of the Series F Preferred Stock (including the amount of any accrued and unpaid dividends thereon) are convertible, at the option of the holder, into common stock at a fixed conversion price equal to $5 per share. If certain defined default events occur, the conversion price would thereafter be reduced (and only reduced), to equal 70% of the average of the two lowest VWAPs of our common stock for the twenty consecutive trading day period prior to the conversion date. If requested by the private investor, the Company will make weekly redemptions of shares of Series F Preferred Stock (including any accrued and unpaid dividends thereon). If the redemption price is paid by the Company in cash, the number of shares to be redeemed in each weekly increment is 250 shares of Series F Preferred Stock, and the redemption price is a price per share equal to $1,250 plus any accrued but unpaid dividends thereon. The Company has the option to make such redemption payments in shares of common stock provided certain specified equity conditions are satisfied at the time of payment. The number of shares of common stock to be issued would be calculated using a per share price equal to 80% of the one lowest VWAP of our common stock for the ten consecutive trading day period prior to the payment date. For redemption payments made in shares of common stock, the Company will redeem either (i) 250 shares of Series F Preferred Stock or (ii) such greater number of shares of Series F Preferred Stock (and also including any accrued and unpaid dividends) that would result upon redemption in the issuance of a number of shares of common stock equal to 12% of the aggregate composite trading volume for the Company’s common stock during the preceding calendar week. The private investor had available to them a new conversion price beginning on June 9, 2016 as a result of the Series H Preferred Stock transaction further described in Note 12. Shares of the Series F Preferred Stock are now convertible, at the option of the private investor, into common stock at a variable conversion price equal to 70% of (i) the lowest VWAP of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. Amendment of Outstanding Series F Preferred Stock Conversion Price On October 5, 2016 , the Company filed a Certificate of Amendment to the Certificate of Designations of Preferences, Rights and Limitations of Series F Preferred Stock with the Secretary of State of the State of Delaware. The Certificate of Amendment amends the conversion price at which the Series F Preferred Stock can be converted into shares of common stock. The Company had approximately $336,000 of Series F Preferred Stock remaining outstanding as of October 5, 2016 . As amended, the conversion price will now be equal to the lowest of (i) 50% of the lowest weighted average price (“VWAP”) of our common stock for the ten consecutive trading day period prior to the conversion date or (ii) 50% of the lowest closing bid price of our common stock for the ten consecutive trading day period prior to the conversion date. If certain “Triggering Events” specified in the terms of the Series F Preferred Stock occur, then the conversion price of the Series F Preferred Stock shall be thereafter reduced, and only reduced, to equal 50% of the average of the lowest traded price of the common stock for the twenty consecutive trading day period prior to the conversion date. The following table summarizes the conversion activity of the Series F Preferred Stock: Conversion Period Principal Converted Dividends Converted Common Shares Issued Q1 2016 $ 2,168,402 $ 19,896 2,183,991 Q2 2016 $ 3,234,000 $ 66,931 6,649,741 Q3 2016 $ 1,261,648 $ 54,096 81,917,367 Q4 2016 $ 175,949 $ 9,168 27,276,006 Q3 2017 $ 20,000 $ — 18,181,818 Q4 2017 $ 107,000 $ 467 172,552,354 $ 6,966,999 $ 150,558 308,761,277 Holders of the Series F Preferred Stock are entitled to dividends in the amount of 7% per annum. As of December 31, 2017 , all shares and accrued dividends had been converted and no balance remained. The Company classified the Series F Preferred Stock as a liability pursuant to ASC 480 on the closing date due to the structure of the financing agreement, whereby the Company has an unconditional obligation that the Company may settle by issuing a variable number of common shares with a monetary value that is fixed and known at inception. Pursuant to a number of factors outlined in ASC Topic 815, Derivatives and Hedging , the conversion option in the Series F Preferred Stock was deemed to include an embedded derivative that required bifurcation and separate accounting. As such, the Company ascertained the value of the conversion option as if separate from the convertible issuance and appropriately recorded that value as a derivative liability. At closing, a derivative liability and a corresponding debt discount in the amount of $1,666,000 were recorded. The debt discount will be charged to interest expense ratably over the life of the Series F Preferred Stock. The derivative balance was $255,324 , as of December 31, 2016 . At December 31, 2017 , the Company recorded the reduction of the remaining embedded derivative associated with the Series F Preferred Stock of $42,347 as a gain in the "Change in fair value of derivatives and gain/(loss) on extinguishment of liabilities, net" in the Condensed Consolidated Statements of Operations. The net gain recorded for the year ended December 31, 2017 was $255,324 , to properly reflect the elimination of the embedded derivative as of December 31, 2017 . SERIES G PREFERRED STOCK On April 29, 2016 , the Company entered into a securities purchase agreement with private investors to issue 2,000 shares of Series G Preferred Stock for $2,000,000 . The Company issued 2,000 shares of Series G Preferred Stock to the private investors, in various tranches between April and June 2016, resulting in gross proceeds to the Company of $2,000,000 . Holders of the Series G Preferred Stock are entitled to dividends in the amount of 10% per annum. One year after issuance, the Company is required to redeem for cash all or any portion of the outstanding shares of the Series G Preferred Stock at a price per share equal to $1,000 plus any accrued but unpaid dividends thereon. Assignment of Series G Preferred Stock Beginning September 19, 2016 , the two private investors (the “Series G Sellers”) entered into assignment agreements with accredited investors (the “Series G Purchasers”). Under the terms of the assignment agreements, the Series G Sellers may sell all 2,000 outstanding shares of Series G Preferred Stock to the Series G Purchasers for a purchase price of $1,000 per share of Series G Preferred Stock (plus the amount of any accrued and unpaid dividends thereon). During 2016 and 2017, the Series G Sellers had sold 1,795 shares of Series G Preferred Stock, representing a value of $1,795,000 , to the Series G Purchasers. On September 21, 2016 , the Company filed a Certificate of Amendment to the Certificate of Designations of Prefe |
Equity Plans and Share-Based Co
Equity Plans and Share-Based Compensation | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Equity Plans and Share-Based Compensation | EQUITY PLANS AND SHARE-BASED COMPENSATION Stock Option Plan: The Company’s 2005 Stock Option Plan, as amended (the “Stock Option Plan”) provides for the grant of incentive or non-statutory stock options to the Company’s employees, directors and consultants. The stock Option Plan initially reserved 170,000 shares (as adjusted for the Reverse Stock Split) of the Company's common stock for option awards to eligible employees. Upon recommendation of the Board of Directors, the stockholders approved an increase in the total shares of common stock reserved for issuance under the Stock Option Plan to 270,000 during 2015. Restricted Stock Plan: The Company’s 2008 Restricted Stock Plan, as amended (the “Restricted Stock Plan”) was adopted by the Board of Directors and was approved by the stockholders on July 1, 2008. The Restricted Stock Plan initially reserved up to 75,000 shares (as adjusted for the Reverse Stock Split) of the Company’s common stock for restricted stock awards and restricted stock units to eligible employees, directors and consultants of the Company. Upon recommendation of the Board of Directors, the stockholders approved an increase in the total shares of common stock reserved for issuance under the Restricted Stock Plan to 125,000 and 750,000 shares during 2015 and 2016, respectively. There were no changes to the plan in 2017. The Stock Option Plan and the Restricted Stock Plan are administered by the Compensation Committee of the Board of Directors, which determines the terms of the option and share awards, including the exercise price, expiration date, vesting schedule and number of shares. The term of any incentive stock option granted under the Stock Option Plan may not exceed ten years, or five years for options granted to an optionee owning more than 10% of the Company’s voting stock. The exercise price of an incentive stock option granted under the Option Plan must be equal to or greater than the fair market value of the shares of the Company’s common stock on the date the option is granted. An incentive stock option granted to an optionee owning more than 10% of the Company’s voting stock must have an exercise price equal to or greater than 110% of the fair market value of the Company’s common stock on the date the option is granted. The exercise price of a non-statutory option granted under the Option Plan must be equal to or greater than 85% of the fair market value of the shares of the Company’s common stock on the date the option is granted. Share-Based Compensation: The Company measures share-based compensation cost at the grant date based on the fair value of the award and recognizes this cost as an expense over the grant recipients’ requisite service periods for all awards made to employees, officers, directors and consultants. The share-based compensation expense recognized in the Consolidated Statements of Operations was as follows: For the years ended December 31, 2017 2016 Share-based compensation cost included in: Research and development $ 18,231 $ 181,985 Selling, general and administrative 105,037 706,363 Total share-based compensation cost $ 123,268 $ 888,348 The following table presents share-based compensation expense by type: For the years ended December 31, 2017 2016 Type of Award: Stock Options $ 96,939 $ 377,653 Restricted Stock Units and Awards 26,329 510,695 Total share-based compensation cost $ 123,268 $ 888,348 Stock Options: The Company recognized share-based compensation expense for stock options of $97,000 to officers, directors and employees for the year ended December 31, 2017 related to stock option awards, reduced for estimated forfeitures. There were no option grants during the year ended December 31, 2017 , and the weighted average estimated fair value of employee stock options granted for the years ended December 31, 2016 was $1.35 per share. Fair value was calculated using the Black-Scholes Option Pricing Model with the following assumptions: For the years ended December 31, 2017 2016 Expected volatility — % 114.6 % Risk free interest rate — % 1.5 % Expected dividends — — Expected life (in years) 0 5.8 years Expected volatility is based on the historical volatility of the Company’s stock. The risk-free rate of return is based on the yield of U.S. Treasury bonds with a maturity equal to the expected term of the award. Historical data is used to estimate forfeitures within the Company’s valuation model. The Company’s expected life of stock option awards is derived from historical experience and represents the period of time that awards are expected to be outstanding. As of December 31, 2017 , total compensation cost related to non-vested stock options not yet recognized was $36,000 which is expected to be recognized over a weighted average period of approximately 1.2 years . As of December 31, 2017 , 67,000 shares were vested or expected to vest in the future at a weighted average exercise price of $30.71 . As of December 31, 2017 , 189,475 shares remained available for future grants under the Option Plan. The following table summarizes stock option activity within the Stock Option Plan: Stock Stock Options Weighted Aggregate Outstanding at December 31, 2015 73,870 $ 56.43 8.84 Granted 33,250 $ 1.35 $ 1,540 Exercised — — Canceled (30,206 ) 41.15 Outstanding at December 31, 2016 76,914 $ 37.67 8.28 Granted — $ — $ — Exercised — — Canceled (6,283 ) 31.23 Outstanding at December 31, 2017 70,631 $ 29.61 7.32 Exercisable at December 31, 2017 52,364 $ 37.75 Restricted Stock: The Company recognized share-based compensation expense related to restricted stock grants of approximately $26,000 for the year ended December 31, 2017 . There were no restricted stock grants during the year ended December 31, 2017 , and the weighted average estimated fair value of restricted stock grants for the year ended December 31, 2016 was $1.97 . There are no unvested shares of restricted stock as of December 31, 2017 , and there is no unrecognized share-based compensation expense from restricted stock. As of December 31, 2017 , approximately 496,000 shares remained available for future grants under the Restricted Stock Plan. The following table summarizes stock option activity within the Restricted Stock Plan: Shares Weighted Average Grant Date Fair Value Non-vested at December 31, 2015 20,487 5.59 Granted 245,414 1.97 Vested (176,693 ) Forfeited (28,618 ) Non-vested at December 31, 2016 60,590 1.84 Granted — — Vested (59,390 ) Forfeited (1,200 ) Non-vested at December 31, 2017 — — |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES The Company records income taxes using the liability method. Under this method, deferred tax assets and liabilities are computed for the expected future impact of temporary differences between the financial statement and income tax bases of assets and liabilities using current income tax rates and for the expected future tax benefit to be derived from tax loss and tax credit carryforwards. ASC 740 provides detailed guidance for the financial statement recognition, measurement and disclosure of uncertain tax positions recognized in the financial statements. Tax positions must meet a “more-likely-than-not” recognition threshold before a benefit is recognized in the financial statements. At December 31, 2017 , the Company had $321,066,413 of cumulative net operating loss carryforwards for federal income tax purposes that were available to offset future taxable income through the year 2037 . Under the Internal Revenue Code, the future utilization of net operating losses may be limited in certain circumstances where there is a significant ownership change. The Company prepared an analysis for the year ended December 31, 2012 and determined that a significant change in ownership has occurred as a result of the cumulative effect of the sales of common stock through its offerings. Such change limited the Company's utilizable net operating loss carryforwards to $234,024,680 for the year ended December 31, 2017 . Available net operating loss carryforwards may be further limited in the event of another significant ownership change. Deferred income taxes reflect an estimate of the cumulative temporary differences recognized for financial reporting purposes from that recognized for income tax reporting purposes. At December 31, 2017 and 2016 , the components of these temporary differences and the deferred tax asset were as follows: As of December 31 2017 2016 Deferred Tax Asset Current: Accrued Expenses $ — $ 192,000 Inventory Allowance 141,000 234,000 Other 13,000 43,000 Total Current 154,000 469,000 Non-current: Stock Based Compensation-Stock Options and Restricted Stock 1,058,000 1,919,000 Tax effect of NOL carryforward 67,852,000 79,384,000 Depreciation 8,748,000 17,406,000 Amortization (368,000 ) (637,000 ) Warranty reserve 14,000 68,000 Total Non-current 77,304,000 98,140,000 Net deferred tax asset 77,458,000 98,609,000 Less valuation allowance (77,458,000 ) (98,609,000 ) Net deferred tax asset $ — $ — In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. Based upon the level of historical losses and projections of future taxable income over the periods in which the deferred tax assets are deductible, management believes it is not "more-likely-than-not" that the Company will realize the benefits of these deductible differences at December 31, 2017 . The Company’s deferred tax valuation allowance of $77,458,000 reflected above is a decrease of $21,151,000 from the valuation allowance reflected as of December 31, 2016 of $98,609,000 . As of December 31, 2017 , the Company has not recorded a liability for uncertain tax positions. The Company recognizes interest and penalties related to uncertain tax positions in income tax (benefit)/expense. No interest and penalties related to uncertain tax positions were accrued at December 31, 2017 . The Company’s effective tax rate for the years ended December 31, 2017 and 2016 differs from the statutory rate due to the following (expressed as a percentage of pre-tax income): 2017 2016 Federal statutory rate 35.0 % 35.0 % State statutory rate 2.8 % 2.6 % Change in rate — % (0.4 )% Permanent tax differences (2.3 )% (0.1 )% Change in fair value of derivatives 8.4 % 0.9 % Deemed interest expense on debt discount (5.5 )% (5.1 )% Loss on extinguishment of liabilities (4.9 )% (5.9 )% Other (0.9 )% (1.8 )% Increase in valuation allowance (32.6 )% (25.6 )% — % — % |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | RELATED PARTY TRANSACTIONS On August 29, 2016 , the Company entered into a note purchase agreement with Tertius Financial Group Pte. Ltd. ("TFG”) for the private placement of $330,000 of the Company’s original issue discount notes with an original maturity date of November 29, 2016 . The notes bear interest of 6% per annum and principal and interest on the notes are payable upon maturity. The notes are unsecured and not convertible into equity shares of the Company. On December 6, 2016 , the Company issued a new $600,000 original issue discount note to TFG in exchange for (i) $200,000 of additional gross proceeds and (ii) cancellation of the existing outstanding $330,000 note. The new TFG note bears interest at a rate of 6% per annum and matures on December 31, 2017 . Principal and interest on the new TFG note is payable at maturity. Following the transaction, the outstanding balance of the new note was $602,000 (including accrued and unpaid interest) with a discount of $60,000 . On January 19, 2017 , the Company issued 333,333,333 shares of unregistered common stock in a private placement to TFG pursuant to a Securities Purchase Agreement (the “SPA”). Pursuant to the SPA, the Company issued the 333,333,333 shares to TFG in exchange for cancellation of its $600,000 promissory note (including accrued interest of approximately $4,340 ) that was issued by the Company on December 6, 2016 . The SPA does not provide any registration rights for the shares issued to TFG. TFG is a Singapore based entity controlled and 50% owned by Ascent’s President & CEO, Victor Lee, and owns approximately 3% of the Company's outstanding shares at December 31, 2017 . All related party transactions were approved by our independent board of directors. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES The Company is subject to various legal proceedings, both asserted and unasserted, that arise in the ordinary course of business. The Company cannot predict the ultimate outcome of such legal proceedings or in certain instances provide reasonable ranges of potential losses. However, as of the date of this report, the Company believes that none of these claims will have a material adverse effect on its consolidated financial position or results of operations. In the event of unexpected subsequent developments and given the inherent unpredictability of these legal proceedings, there can be no assurance that the Company’s assessment of any claim will reflect the ultimate outcome, and an adverse outcome in certain matters could, from time to time, have a material adverse effect on the Company’s consolidated financial position or results of operations in particular quarterly or annual periods. On October 21, 2011, the Company was notified that a complaint claiming $3.0 million for an investment banking fee (the “Lawsuit”) was filed by Jefferies & Company, Inc. (“Jefferies”) against the Company in New York State Supreme Court in the County of New York. In December 2010, Ascent and Jefferies entered into an engagement agreement (the “Fee Agreement”) pursuant to which Jefferies was hired to act as the Company's financial advisor in relation to certain potential transactions. In addition, Jefferies claimed an award for attorney's fees and prejudgment interest in the approximate amount of $1.2 million . On April 16, 2014, the parties settled the lawsuit where the Company agreed to pay Jefferies a total of $2.0 million in equal installments over 40 months. The Company paid $339,481 during the year ended December 31, 2017 . The Company records a liability in its financial statements for costs related to claims, including settlements and judgments, where the Company has assessed that a loss is probable and an amount can be reasonably estimated. The Company accrued $1.7 million , the net present value of the $2.0 million settlement, as of December 31, 2013. As of December 31, 2017 , the settlement had been redeemed in full and there was no remaining accrued litigation settlement, recorded as a current liability on the Consolidated Balance Sheets. |
Retirement Plan
Retirement Plan | 12 Months Ended |
Dec. 31, 2017 | |
Retirement Benefits [Abstract] | |
Retirement Plan | RETIREMENT PLAN On July 1, 2006, the Company adopted a qualified 401(k) plan which provides retirement benefits for all of its eligible employees. Under the plan, employees become eligible to participate at the first entry date, provided they are at least 21 years of age. The participants may elect through salary reduction to contribute up to ceilings established in the Internal Revenue Code. The Company will match 100% of the first six percent of employee contributions. In addition, the Company may make discretionary contributions to the Plan as determined by the Board of Directors. Employees are immediately vested in all salary reduction contributions. Rights to benefits provided by the Company’s discretionary and matching contributions vest 100% after the first year of service for all employees hired before January 1, 2010. For employees hired after December 31, 2009, matching contributions vest over a three -year period, one-third per year. Payments for 401(k) matching totaled $199,669 and $338,230 for the years ended December 31, 2017 and 2016 , respectively. Payments for 401(k) matching are recorded under “Research, development and manufacturing operations" expense and “Selling, general and administrative" expense in the Consolidated Statements of Operations. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | SUBSEQUENT EVENTS Secured Promissory Notes Between January 11, 2018 and March 21, 2018 , the Company received the remaining $1,500,000 in proceeds per the Securities Purchase Agreement dated November 30, 2017 (Note 10). The funding occurred in six tranches as follows: Date Received Amount Received Maturity Date 1/11/2018 $ 250,000 1/11/2019 1/25/2018 $ 250,000 1/25/2019 2/8/2018 $ 250,000 2/8/2019 2/22/2018 $ 250,000 2/22/2019 3/7/2018 $ 250,000 3/7/2019 3/21/2018 $ 250,000 3/21/2019 Between January 4, 2018 and March 26, 2018 , the Company made five payments of $250,000 in stock. The aggregate payments of $1,250,000 resulted in the issuance of 2,450,980,392 shares of the Company's common stock. As of the date of this report, the total principal balance of the notes under the aforementioned Securities Purchase Agreement was $4,665,675 . Promissory Notes On January 31, 2018 , the Company and a private investor entered into a promissory note agreement for the $177,500 of aggregate proceeds received in December 2017 (Note11). This $200,000 original issue discount note is unsecured, was issued with a discount of $22,500 , bears interest at 12% per annum, and matures on December 29, 2018 . As of the date of this filing, the principal balance on this note is $200,000 . On February 16, 2018 , the Company received $30,000 in proceeds from a private investor. As of the date of this filing, the Company is expecting more funding from this investor and has not yet finalized the note. St. George Convertible Note In lieu of the cash payments for January and February 2018, we increased the reserve for the St. George Convertible Note by 2 billion shares, to a total of 6.88 billion shares. On March 12, 2018 , the investor, pursuant to the terms of the Convertible Promissory Note dated September 11, 2017 (Note 14), elected to redeem a portion of the note in conversion shares. On this date, the investor redeemed $75,000 of the note, resulting n the issuance of 187,500,000 shares of the Company's common stock. These shares were drawn out of the reserve created for this note the remaining reserves are 6.69 billion . As of the date of this report, the remaining principal balance on the St. George Convertible Note is $1,630,833 . BayBridge Convertible Note On March 26, 2018, pursuant to the terms of the Convertible Promissory Note dated November 30, 2017, the investor converted $105,000 in principal and $20,717 in interest into shares of the Company's common stock, resulting in the issuance of 493,006,549 shares. As of the date of this report, the remaining principal balance on the BayBridge Convertible Note is $460,000 . |
Summary of Significant Accoun37
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Cash Equivalents | The Company classifies all short-term investments in interest bearing bank accounts and highly liquid debt securities purchased with an original maturity of three months or less to be cash equivalents. The Company maintains cash balances which may exceed federally insured limits. The Company does not believe this results in significant credit risk. |
Foreign Currencies | Bank account balances held in foreign currencies are translated to U.S. dollars utilizing the period end exchange rate. Gains or losses incurred in connection with the Company’s accounts held in foreign currency were not material for the years ended December 31, 2017 and 2016 and were recorded in “Other Income/(Expense)” in the Consolidated Statements of Operations. |
Receivables and Allowance for Doubtful Accounts | Trade accounts receivable are recorded at the invoiced amount as the result of transactions with customers. The Company maintains allowances for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments. The Company estimates the collectability of accounts receivable using analysis of historical bad debts, customer credit-worthiness and current economic trends. Reserves are established on an account-by-account basis. Account balances are written off against the allowance in the period in which the Company determines that is it probable that the receivable will not be recovered. |
Inventories | All inventories are stated at the lower of cost or net realizable value, with cost determined using the weighted average method. Inventory balances are frequently evaluated to ensure they do not exceed net realizable value. The computation for net realizable value takes into account many factors, including expected demand, product life cycle and development plans, module efficiency, quality issues, obsolescence and others. Management's judgment is required to determine reserves for obsolete or excess inventory. |
Property, Plant and Equipment | Property, plant and equipment are recorded at the original cost to the Company. Assets are being depreciated over estimated useful lives of three to forty years using the straight-line method, as presented in the table below, commencing when the asset is placed in service. Leasehold improvements are depreciated over the shorter of the remainder of the lease term or the life of the improvements. Upon retirement or disposal, the cost of the asset disposed of and the related accumulated depreciation are removed from the accounts and any gain or loss is reflected in income. Expenditures for repairs and maintenance are expensed as incurred. Useful Lives in Years Buildings 40 Manufacturing machinery and equipment 5 - 10 Furniture, fixtures, computer hardware/software 3 - 7 Leasehold improvements life of lease |
Patents | At such time as the Company is awarded patents, patent costs are amortized on a straight-line basis over the legal life on the patents, or over their estimated useful lives, whichever is shorter. |
Impairment of Long-lived Assets | The Company analyzes its long-lived assets (property, plant and equipment) and definitive-lived intangible assets (patents) for impairment, both individually and as a group, whenever events or changes in circumstances indicate the carrying amount of the assets may not be recoverable. Events that might cause impairment would include significant current period operating or cash flow losses associated with the use of a long-lived asset or group of assets combined with a history of such losses, significant changes in the manner of use of assets and significant negative industry or economic trends. An undiscounted cash flow analysis is calculated to determine if impairment exists. If impairment is determined to exist, any related loss is calculated using the difference between the fair value and the carrying value of the assets. |
Interest Capitalization | Historically the Company has capitalized interest cost as part of the cost of acquiring or constructing certain assets during the period of time required to get the asset ready for its intended use. The Company capitalized interest to the extent that expenditures to acquire or construct an asset have occurred and interest cost has been incurred. |
Convertible Preferred Stock | The Company evaluates its preferred stock instruments under FASB ASC 480, "Distinguishing Liabilities from Equity" to determine the classification, and thereby the accounting treatment, of the instruments. |
Derivatives | The Company evaluates its financial instruments under FASB ASC 815, "Derivatives and Hedging" to determine whether the instruments contain an embedded derivative. When an embedded derivative is present, the instrument is evaluated for a fair value adjustment upon issuance and at the end of every reporting period. Any adjustments to fair value are treated as gains and losses in fair values of derivatives and are recorded in the Consolidated Statements of Operations. |
Product Warranties | The Company provides a limited warranty to the original purchaser of products against defective materials and workmanship. The Company also guarantees that standalone modules and PV integrated consumer electronics will achieve and maintain the stated conversion efficiency rating for certain products. Warranty accruals are recorded at the time of sale and are estimated based upon product warranty terms, historical experience and analysis of peer company product returns. The Company assesses the adequacy of its liabilities and makes adjustments as necessary based on known or anticipated warranty claims, or as new information becomes available. |
Warrant liability | Warrants to purchase the Company's common stock with nonstandard anti-dilution provisions, regardless of the probability or likelihood that may conditionally obligate the issuer to ultimately transfer assets, are classified as liabilities and are recorded at their estimated fair value at each reporting period. Any change in fair value of these warrants is recorded at each reporting period in Other income/(expense) on the Company's statement of operations. |
Product revenue | The Company generated product revenues of $642,179 and $1,699,802 for the years ended December 31, 2017 and 2016 , respectively. Product revenue is generated from commercial sales of flexible PV modules and PV integrated consumer electronics, non-PV integrated power banks and associated accessories. Products are sold through the Company's own e-commerce website, online retailers, direct to retailers and indirectly to retailers through distributors. Revenue is recognized as products are shipped or delivered and title has transferred to the customer. In certain instances, the Company has agreed to refund a portion of the purchase price to customers if the Company decreases its standard retail price. The Company estimates the effect of this price protection and records the difference as a reduction of revenue at the time of sale. We also, in certain instances have provided customers with a right of return provision. In these instances, we defer the recognition of revenues until the provision period has expired. Estimated costs of returns and allowances, other than those specifically pertaining to a right of return provision, and discounts are accrued as a reduction to sales when revenue is recognized. |
Government contracts revenue | Revenue from governmental research and development contracts is generated under terms that are cost plus fee or firm fixed price. Revenue from cost plus fee contracts is recognized as costs are incurred on the basis of direct costs plus allowable indirect costs and an allocable portion of the fixed fee. Revenue from firm fixed price contracts is recognized under the percentage-of-completion method of accounting, with costs and estimated profits included in contract revenue as work is performed. If actual and estimated costs to complete a contract indicate a loss, provision is made currently for the loss anticipated on the contract. |
Shipping and Handling Costs | The Company classifies shipping and handling costs for products shipped to customers as a component of “Cost of revenues” on the Company’s Consolidated Statements of Operations. Customer payments of shipping and handling costs are recorded as a component of Revenues. |
Research, Development and Manufacturing Operations Costs | Research, development and manufacturing operations expenses were approximately $4.8 million and $6.6 million for the years ended December 31, 2017 and 2016 , respectively. Research, development and manufacturing operations expenses include: 1) technology development costs, which include expenses incurred in researching new technology, improving existing technology and performing federal government research and development contracts, 2) product development costs, which include expenses incurred in developing new products and lowering product design costs, and 3) pre-production and production costs, which include engineering efforts to improve production processes, material yields and equipment utilization, and manufacturing efforts to produce saleable product. Research, development and manufacturing operations costs are expensed as incurred, with the exception of costs related to inventoried raw materials, work-in-process and finished goods, which are expensed as Cost of revenue as products are sold. |
Marketing and Advertising Costs | The Company advertises in print, television, online and through social media. The Company will also authorize customers to run advertising campaigns on its behalf through various media outlets. Marketing and advertising costs are expensed as incurred. |
Share-Based Compensation | The Company measures and recognizes compensation expense for all share-based payment awards made to employees, officers, directors, and consultants based on estimated fair values. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service period in the Company’s Statements of Operations. Share-based compensation is based on awards ultimately expected to vest and is reduced for estimated forfeitures. Forfeitures are estimated at the time of grant and revised, as necessary, in subsequent periods if actual forfeitures differ from those estimates. For purposes of determining estimated fair value of share-based payment awards on the date of grant the Company uses the Black-Scholes option-pricing model (“Black-Scholes Model”) for option awards. The Black-Scholes Model requires the input of highly subjective assumptions. Because the Company’s employee stock options may have characteristics significantly different from those of traded options, and because changes in the subjective input assumptions can materially affect the fair value estimate, in management’s opinion, the existing models may not provide a reliable single measure of the fair value of the Company’s employee stock options. Management will continue to assess the assumptions and methodologies used to calculate estimated fair value of share-based compensation. Circumstances may change and additional data may become available over time, which result in changes to these assumptions and methodologies, which could materially impact the Company’s fair value determination. The Company estimates the fair value of its restricted stock awards as its stock price on the grant date. The accounting guidance for share-based compensation may be subject to further interpretation and refinement over time. There are significant differences among option valuation models, and this may result in a lack of comparability with other companies that use different models, methods and assumptions. If factors change and the Company employs different assumptions in the accounting for share-based compensation in future periods, or if the Company decides to use a different valuation model, the compensation expense the Company records in the future may differ significantly from the amount recorded in the current period and could materially affect its loss from operations, net loss and net loss per share. |
Income Taxes | Deferred income taxes are provided using the liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carry forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of the changes in tax laws and rates as of the date of enactment. Interest and penalties, if applicable, would be recorded in operations. The Company has analyzed filing positions in all of the federal and state jurisdictions where it is required to file income tax returns, as well as all open tax years (2014-2017) in these jurisdictions. The Company believes its income tax filing positions and deductions will be sustained on audit and does not anticipate any adjustments that will result in a material adverse effect on the Company’s financial condition, results of operations, or cash flows. Therefore, no reserves for uncertain income tax positions have been recorded. |
Net Loss per Common Share | Basic loss per share does not include dilution and is computed by dividing income available to common stockholders by the weighted average number of shares outstanding during the period. Diluted earnings per share reflect the potential securities that could share in the earnings of the Company, similar to fully diluted earnings per share. Common stock equivalents outstanding as of December 31, 2017 and 2016 of approximately 3.0 billion and 301.1 million shares have been omitted from loss per share because they are anti-dilutive. Common stock equivalents consist of stock options, unvested restricted stock, warrants, preferred stock, preferred stock make-whole dividend liability amounts (assuming the make-whole dividend liability is paid in common stock in lieu of cash), and convertible notes (assuming the amortization payments are paid in common stock in lieu of cash). |
Fair Value Estimates | Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The Company uses fair value hierarchy based on three levels of inputs, of which, the first two are considered observable and the last unobservable, to measure fair value: • Level 1 - Quoted prices in active markets for identical assets or liabilities. • Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. • Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Certain long-lived assets and current liabilities have been measured at fair value on a recurring and non-recurring basis. See Note 6. Property, Plant and Equipment, Note 10. Secured Promissory Note, Note 12. July 2016 Convertible Notes and Series H Preferred Stock, Note 13. October 2016 Convertible Notes and Exchange of Series A Preferred Stock, Note 13. St. George Convertible Note, Note 15. BayBridge Convertible Note, Note 17. Series E Preferred Stock, Note 18. Series F Preferred Stock, Note 19. Series G Preferred Stock, Note 20. Series I Preferred Stock and Series I Convertible Notes, Note 21. Series J Preferred Stock and Series J-1 Preferred Stock, and Note 23. Make-whole Dividend Liability. The carrying amount of our long term debt outstanding approximates fair value because our current borrowing rate does not materially differ from market rates for similar bank borrowings. The carrying value for cash and cash equivalents, restricted cash, accounts receivable, accounts payable, accrued expenses and other assets and liabilities approximate their fair values due to their short maturities. |
Related Party Transactions | One of the Company's named shareholders is Tertius Financial Group Pte Ltd, of which Mr. Victor Lee, President and Chief Executive Officer of the Company, is Managing Director and 50% shareholder. Accounting for transactions under these agreements is consistent with those defined in our Significant Accounting Policies. |
Use of Estimates | The preparation of financial statements in conformity with U.S. generally accepted accounting principles ("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Recently Issued Accounting Standards | In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) . The update will establish a comprehensive revenue recognition standard for virtually all industries in GAAP. ASU 2014-09 will change the amount and timing of revenue and cost recognition, implementation, disclosures and documentation. In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of Effective Date. The amendments in ASU 2015-14 defer the effective date of ASU 2014-09 for all entities by one year. ASU 2014-09 is now effective for the Company in fiscal year 2018. The Company has evaluated ASU 2014-09, and it will not have a material effect on the Company’s consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) . ASU 2016-02 requires lessees to recognize all leases, including operating leases, on the balance sheet as a lease asset or lease liability, unless the lease is a short-term lease. ASU 2016-02 also requires additional disclosures regarding leasing arrangements. ASU 2016-02 is effective for interim periods and fiscal years beginning after December 15, 2018, and early application is permitted. The Company continues to evaluate the impact, that the adoption of this guidance will have on its consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting , which simplifies several aspects of the accounting for share-based payment transactions, including 1) accounting for income taxes, 2) classification of excess tax benefits in the statement of cash flows, 3) forfeitures, 4) minimum statutory tax withholding requirements, 5) cash flow classification of employee taxes withheld in the form of shares, 6) the practical expedient for estimating the expected term, and 7) intrinsic value. The guidance is effective for annual reporting periods beginning after December 15, 2016, and interim periods within those annual periods. The implementation of ASU 2016-09 did not have a material effect on the Company's consolidated financial statements. In May 2017, the FASB issued ASU No. 2017-09, Compensation - Stock Compensation (Topic 718) . ASU 2017-09 provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. ASU 2017-09 is effective for interim periods and fiscal years beginning after December 15, 2017, and early application is permitted. The Company continues to evaluate the impact, if any, that the adoption of this guidance will have on its consolidated financial statements, but does not expect the effect, if any, will be material. In July 2017, the FASB issued ASU No. 2017-11 Part I, Earnings Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480), Derivatives and Hedging (Topic 815) . ASU 2017-11 Part I changes the classification analysis of certain equity linked financial instruments with down round features. ASU 2017-11 Part I is effective, for public business entities, for interim periods and fiscal years beginning after December 15, 2018, and early application is permitted. The Company is currently evaluating the impact, if any, that the adoption of this guidance will have on its consolidated financial statements. |
Summary of Significant Accoun38
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Property, Plant and Equipment | Useful Lives in Years Buildings 40 Manufacturing machinery and equipment 5 - 10 Furniture, fixtures, computer hardware/software 3 - 7 Leasehold improvements life of lease The following table summarizes property, plant and equipment as of December 31, 2017 and December 31, 2016 : As of December 31, 2017 2016 Building $ 5,828,960 $ 5,828,960 Furniture, fixtures, computer hardware and computer software 489,421 489,421 Manufacturing machinery and equipment 30,327,481 30,321,079 Depreciable property, plant and equipment 36,645,862 36,639,460 Less: Accumulated depreciation and amortization (32,013,686 ) (30,983,448 ) Net property, plant and equipment $ 4,632,176 $ 5,656,012 |
Future Amortization of Patents | As of December 31, 2017 , future amortization of patents is expected as follows: 2018 $ 173,439 2019 $ 153,717 2020 $ 130,885 2021 $ 85,760 2022 $ 56,099 Thereafter $ 40,267 $ 640,167 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Useful Lives in Years Buildings 40 Manufacturing machinery and equipment 5 - 10 Furniture, fixtures, computer hardware/software 3 - 7 Leasehold improvements life of lease The following table summarizes property, plant and equipment as of December 31, 2017 and December 31, 2016 : As of December 31, 2017 2016 Building $ 5,828,960 $ 5,828,960 Furniture, fixtures, computer hardware and computer software 489,421 489,421 Manufacturing machinery and equipment 30,327,481 30,321,079 Depreciable property, plant and equipment 36,645,862 36,639,460 Less: Accumulated depreciation and amortization (32,013,686 ) (30,983,448 ) Net property, plant and equipment $ 4,632,176 $ 5,656,012 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Inventory Disclosure [Abstract] | |
Schedule of inventory, current | Inventories consisted of the following at December 31, 2017 and December 31, 2016 : As of December 31, 2017 2016 Raw materials $ 689,000 $ 833,000 Work in process 12,000 635,000 Finished goods 337,000 1,102,000 Total $ 1,038,000 $ 2,570,000 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of Maturities of Long-term Debt | As of December 31, 2017 , future principal payments on long-term debt are due as follows: 2018 $ 343,395 2019 366,757 2020 391,709 2021 418,358 2022 446,821 Thereafter 3,494,779 $ 5,461,819 |
Secured Promissory Note (Tables
Secured Promissory Note (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | As of December 31, 2017 , the closing dates, closing amounts, and maturity dates on completed Note SPA tranches are as follows: Closing Date Closing Amount Maturity Date 11/30/2017 $ 250,000 11/30/2018 12/28/2017 $ 250,000 12/28/2018 |
Series H Preferred Stock and 43
Series H Preferred Stock and July 2016 Convertible Notes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Schedule of Debt Conversions | The following table summarizes the conversion activity on the principal of the July 2106 Convertible Notes: Conversion Period Principal Converted Common Shares Issued Q4 2016 $ 152,460 64,000,000 Q1 2017 1,017,732 959,704,543 Q2 2017 682,235 1,865,043,998 $ 1,852,427 2,888,748,541 The following table summarizes the conversion activity of the Exchange Convertible Notes, which were converted in full as of December 31, 2017 : Conversion Period Principal Converted Interest Converted Common Shares Issued Q3 2016 $ 15,000 $ — 1,470,588 Q4 2016 $ 91,563 $ — 13,346,274 Q1 2017 $ 70,000 $ — 50,503,662 Q2 2017 $ 37,535 $ — 86,987,428 Q3 2017 $ 118,535 $ 10,268 306,675,548 $ 332,633 $ 10,268 458,983,500 |
Series E Preferred Stock and 44
Series E Preferred Stock and the Committed Equity Line (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Schedule of Conversions of Stock | The following table summarizes the conversion activity of the Series E Preferred Stock: Conversion Period Preferred Series E Shares Converted Value of Series E Preferred Shares (inclusive of accrued dividends) Common Shares Issued Q4 2015 478 $ 481,500 250,000 Q1 2016 1,220 1,239,436 1,132,000 Q2 2016 365 381,414 7,979,568 Q3 2016 523 548,896 21,973,747 Q4 2016 94 101,018 13,089,675 Q1 2017 15 16,248 8,289,962 Q2 2017 35 38,886 134,927,207 Q3 2017 70 76,814 129,314,677 2,800 $ 2,884,212 316,956,836 The following table summarizes the conversion activity of the Series F Preferred Stock: Conversion Period Principal Converted Dividends Converted Common Shares Issued Q1 2016 $ 2,168,402 $ 19,896 2,183,991 Q2 2016 $ 3,234,000 $ 66,931 6,649,741 Q3 2016 $ 1,261,648 $ 54,096 81,917,367 Q4 2016 $ 175,949 $ 9,168 27,276,006 Q3 2017 $ 20,000 $ — 18,181,818 Q4 2017 $ 107,000 $ 467 172,552,354 $ 6,966,999 $ 150,558 308,761,277 The following table summarizes the conversion activity of the Series G Preferred Stock: Conversion Period Principal Converted Dividends Converted Common Shares Issued Q4 2016 $ 892,000 $ 37,895 245,726,283 Q1 2017 $ 372,000 $ 25,970 327,718,386 Q2 2017 $ 526,000 $ 49,096 1,337,776,821 $ 1,790,000 $ 112,961 1,911,221,490 The following table summarizes the conversion activity of Series K Preferred Stock: Conversion Period Preferred Series K Shares Converted Value of Series K Preferred Shares Common Shares Issued Q2 2017 3,200 $ 3,200,000 800,000,000 Q3 2017 3,000 $ 3,000,000 750,000,000 6,200 $ 6,200,000 1,550,000,000 |
Series F Preferred Stock (Table
Series F Preferred Stock (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Schedule of Conversions of Stock | The following table summarizes the conversion activity of the Series E Preferred Stock: Conversion Period Preferred Series E Shares Converted Value of Series E Preferred Shares (inclusive of accrued dividends) Common Shares Issued Q4 2015 478 $ 481,500 250,000 Q1 2016 1,220 1,239,436 1,132,000 Q2 2016 365 381,414 7,979,568 Q3 2016 523 548,896 21,973,747 Q4 2016 94 101,018 13,089,675 Q1 2017 15 16,248 8,289,962 Q2 2017 35 38,886 134,927,207 Q3 2017 70 76,814 129,314,677 2,800 $ 2,884,212 316,956,836 The following table summarizes the conversion activity of the Series F Preferred Stock: Conversion Period Principal Converted Dividends Converted Common Shares Issued Q1 2016 $ 2,168,402 $ 19,896 2,183,991 Q2 2016 $ 3,234,000 $ 66,931 6,649,741 Q3 2016 $ 1,261,648 $ 54,096 81,917,367 Q4 2016 $ 175,949 $ 9,168 27,276,006 Q3 2017 $ 20,000 $ — 18,181,818 Q4 2017 $ 107,000 $ 467 172,552,354 $ 6,966,999 $ 150,558 308,761,277 The following table summarizes the conversion activity of the Series G Preferred Stock: Conversion Period Principal Converted Dividends Converted Common Shares Issued Q4 2016 $ 892,000 $ 37,895 245,726,283 Q1 2017 $ 372,000 $ 25,970 327,718,386 Q2 2017 $ 526,000 $ 49,096 1,337,776,821 $ 1,790,000 $ 112,961 1,911,221,490 The following table summarizes the conversion activity of Series K Preferred Stock: Conversion Period Preferred Series K Shares Converted Value of Series K Preferred Shares Common Shares Issued Q2 2017 3,200 $ 3,200,000 800,000,000 Q3 2017 3,000 $ 3,000,000 750,000,000 6,200 $ 6,200,000 1,550,000,000 |
Series G Preferred Stock (Table
Series G Preferred Stock (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Schedule of Conversions of Stock | The following table summarizes the conversion activity of the Series E Preferred Stock: Conversion Period Preferred Series E Shares Converted Value of Series E Preferred Shares (inclusive of accrued dividends) Common Shares Issued Q4 2015 478 $ 481,500 250,000 Q1 2016 1,220 1,239,436 1,132,000 Q2 2016 365 381,414 7,979,568 Q3 2016 523 548,896 21,973,747 Q4 2016 94 101,018 13,089,675 Q1 2017 15 16,248 8,289,962 Q2 2017 35 38,886 134,927,207 Q3 2017 70 76,814 129,314,677 2,800 $ 2,884,212 316,956,836 The following table summarizes the conversion activity of the Series F Preferred Stock: Conversion Period Principal Converted Dividends Converted Common Shares Issued Q1 2016 $ 2,168,402 $ 19,896 2,183,991 Q2 2016 $ 3,234,000 $ 66,931 6,649,741 Q3 2016 $ 1,261,648 $ 54,096 81,917,367 Q4 2016 $ 175,949 $ 9,168 27,276,006 Q3 2017 $ 20,000 $ — 18,181,818 Q4 2017 $ 107,000 $ 467 172,552,354 $ 6,966,999 $ 150,558 308,761,277 The following table summarizes the conversion activity of the Series G Preferred Stock: Conversion Period Principal Converted Dividends Converted Common Shares Issued Q4 2016 $ 892,000 $ 37,895 245,726,283 Q1 2017 $ 372,000 $ 25,970 327,718,386 Q2 2017 $ 526,000 $ 49,096 1,337,776,821 $ 1,790,000 $ 112,961 1,911,221,490 The following table summarizes the conversion activity of Series K Preferred Stock: Conversion Period Preferred Series K Shares Converted Value of Series K Preferred Shares Common Shares Issued Q2 2017 3,200 $ 3,200,000 800,000,000 Q3 2017 3,000 $ 3,000,000 750,000,000 6,200 $ 6,200,000 1,550,000,000 |
Series I Preferred Stock and 47
Series I Preferred Stock and Series I Convertible Notes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Schedule of Debt Conversions | The following table summarizes the conversion activity on the principal of the July 2106 Convertible Notes: Conversion Period Principal Converted Common Shares Issued Q4 2016 $ 152,460 64,000,000 Q1 2017 1,017,732 959,704,543 Q2 2017 682,235 1,865,043,998 $ 1,852,427 2,888,748,541 The following table summarizes the conversion activity of the Exchange Convertible Notes, which were converted in full as of December 31, 2017 : Conversion Period Principal Converted Interest Converted Common Shares Issued Q3 2016 $ 15,000 $ — 1,470,588 Q4 2016 $ 91,563 $ — 13,346,274 Q1 2017 $ 70,000 $ — 50,503,662 Q2 2017 $ 37,535 $ — 86,987,428 Q3 2017 $ 118,535 $ 10,268 306,675,548 $ 332,633 $ 10,268 458,983,500 |
Series K Preferred Stock (Table
Series K Preferred Stock (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Schedule of Stock by Class | The following summarizes the closings and proceeds received as of December 31, 2017 : Closing Period Preferred Series K Shares Purchased Closing Amount Q1 2017 150 $ 150,000 Q2 2017 4,100 $ 4,100,000 Q3 2017 4,760 $ 4,760,000 9,010 $ 9,010,000 The following table summarizes the designations, shares authorized, and shares outstanding for the Company's Preferred Stock: Preferred Stock Series Designation Shares Authorized Shares Outstanding Series A 750,000 60,756 Series B-1 2,000 — Series B-2 1,000 — Series C 1,000 — Series D 3,000 — Series D-1 2,500 — Series E 2,800 — Series F 7,000 — Series G 2,000 — Series H 2,500 — Series I 1,000 — Series J 1,350 — Series J-1 1,000 — Series K 20,000 2,810 |
Schedule of Conversions of Stock | The following table summarizes the conversion activity of the Series E Preferred Stock: Conversion Period Preferred Series E Shares Converted Value of Series E Preferred Shares (inclusive of accrued dividends) Common Shares Issued Q4 2015 478 $ 481,500 250,000 Q1 2016 1,220 1,239,436 1,132,000 Q2 2016 365 381,414 7,979,568 Q3 2016 523 548,896 21,973,747 Q4 2016 94 101,018 13,089,675 Q1 2017 15 16,248 8,289,962 Q2 2017 35 38,886 134,927,207 Q3 2017 70 76,814 129,314,677 2,800 $ 2,884,212 316,956,836 The following table summarizes the conversion activity of the Series F Preferred Stock: Conversion Period Principal Converted Dividends Converted Common Shares Issued Q1 2016 $ 2,168,402 $ 19,896 2,183,991 Q2 2016 $ 3,234,000 $ 66,931 6,649,741 Q3 2016 $ 1,261,648 $ 54,096 81,917,367 Q4 2016 $ 175,949 $ 9,168 27,276,006 Q3 2017 $ 20,000 $ — 18,181,818 Q4 2017 $ 107,000 $ 467 172,552,354 $ 6,966,999 $ 150,558 308,761,277 The following table summarizes the conversion activity of the Series G Preferred Stock: Conversion Period Principal Converted Dividends Converted Common Shares Issued Q4 2016 $ 892,000 $ 37,895 245,726,283 Q1 2017 $ 372,000 $ 25,970 327,718,386 Q2 2017 $ 526,000 $ 49,096 1,337,776,821 $ 1,790,000 $ 112,961 1,911,221,490 The following table summarizes the conversion activity of Series K Preferred Stock: Conversion Period Preferred Series K Shares Converted Value of Series K Preferred Shares Common Shares Issued Q2 2017 3,200 $ 3,200,000 800,000,000 Q3 2017 3,000 $ 3,000,000 750,000,000 6,200 $ 6,200,000 1,550,000,000 |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Summary of Warrant Activity | The following table summarizes warrant activity: Warrant Warrant Outstanding at December 31, 2016 — $ — Granted 700,000,000 $ 0.003 Exercised — $ — Canceled — $ — Outstanding at December 31, 2017 700,000,000 $ 0.003 Exercisable at December 31, 2017 700,000,000 $ 0.003 |
Schedule of Stock by Class | The following summarizes the closings and proceeds received as of December 31, 2017 : Closing Period Preferred Series K Shares Purchased Closing Amount Q1 2017 150 $ 150,000 Q2 2017 4,100 $ 4,100,000 Q3 2017 4,760 $ 4,760,000 9,010 $ 9,010,000 The following table summarizes the designations, shares authorized, and shares outstanding for the Company's Preferred Stock: Preferred Stock Series Designation Shares Authorized Shares Outstanding Series A 750,000 60,756 Series B-1 2,000 — Series B-2 1,000 — Series C 1,000 — Series D 3,000 — Series D-1 2,500 — Series E 2,800 — Series F 7,000 — Series G 2,000 — Series H 2,500 — Series I 1,000 — Series J 1,350 — Series J-1 1,000 — Series K 20,000 2,810 |
Equity Plans and Share-Based 50
Equity Plans and Share-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-based compensation cost by line item | The share-based compensation expense recognized in the Consolidated Statements of Operations was as follows: For the years ended December 31, 2017 2016 Share-based compensation cost included in: Research and development $ 18,231 $ 181,985 Selling, general and administrative 105,037 706,363 Total share-based compensation cost $ 123,268 $ 888,348 |
Share-based compensation cost by award type | The following table presents share-based compensation expense by type: For the years ended December 31, 2017 2016 Type of Award: Stock Options $ 96,939 $ 377,653 Restricted Stock Units and Awards 26,329 510,695 Total share-based compensation cost $ 123,268 $ 888,348 |
Share-based compensation fair value assumptions | Fair value was calculated using the Black-Scholes Option Pricing Model with the following assumptions: For the years ended December 31, 2017 2016 Expected volatility — % 114.6 % Risk free interest rate — % 1.5 % Expected dividends — — Expected life (in years) 0 5.8 years |
Stock option activity | The following table summarizes stock option activity within the Stock Option Plan: Stock Stock Options Weighted Aggregate Outstanding at December 31, 2015 73,870 $ 56.43 8.84 Granted 33,250 $ 1.35 $ 1,540 Exercised — — Canceled (30,206 ) 41.15 Outstanding at December 31, 2016 76,914 $ 37.67 8.28 Granted — $ — $ — Exercised — — Canceled (6,283 ) 31.23 Outstanding at December 31, 2017 70,631 $ 29.61 7.32 Exercisable at December 31, 2017 52,364 $ 37.75 |
Restricted stock activity | The following table summarizes stock option activity within the Restricted Stock Plan: Shares Weighted Average Grant Date Fair Value Non-vested at December 31, 2015 20,487 5.59 Granted 245,414 1.97 Vested (176,693 ) Forfeited (28,618 ) Non-vested at December 31, 2016 60,590 1.84 Granted — — Vested (59,390 ) Forfeited (1,200 ) Non-vested at December 31, 2017 — — |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Schedule of deferred tax assets and liabilities | At December 31, 2017 and 2016 , the components of these temporary differences and the deferred tax asset were as follows: As of December 31 2017 2016 Deferred Tax Asset Current: Accrued Expenses $ — $ 192,000 Inventory Allowance 141,000 234,000 Other 13,000 43,000 Total Current 154,000 469,000 Non-current: Stock Based Compensation-Stock Options and Restricted Stock 1,058,000 1,919,000 Tax effect of NOL carryforward 67,852,000 79,384,000 Depreciation 8,748,000 17,406,000 Amortization (368,000 ) (637,000 ) Warranty reserve 14,000 68,000 Total Non-current 77,304,000 98,140,000 Net deferred tax asset 77,458,000 98,609,000 Less valuation allowance (77,458,000 ) (98,609,000 ) Net deferred tax asset $ — $ — |
Schedule of effective income tax rate reconciliation | The Company’s effective tax rate for the years ended December 31, 2017 and 2016 differs from the statutory rate due to the following (expressed as a percentage of pre-tax income): 2017 2016 Federal statutory rate 35.0 % 35.0 % State statutory rate 2.8 % 2.6 % Change in rate — % (0.4 )% Permanent tax differences (2.3 )% (0.1 )% Change in fair value of derivatives 8.4 % 0.9 % Deemed interest expense on debt discount (5.5 )% (5.1 )% Loss on extinguishment of liabilities (4.9 )% (5.9 )% Other (0.9 )% (1.8 )% Increase in valuation allowance (32.6 )% (25.6 )% — % — % |
Subsequent Events (Tables)
Subsequent Events (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Subsequent Events [Abstract] | |
Schedule of Short-term Debt Instruments | The funding occurred in six tranches as follows: Date Received Amount Received Maturity Date 1/11/2018 $ 250,000 1/11/2019 1/25/2018 $ 250,000 1/25/2019 2/8/2018 $ 250,000 2/8/2019 2/22/2018 $ 250,000 2/22/2019 3/7/2018 $ 250,000 3/7/2019 3/21/2018 $ 250,000 3/21/2019 |
Organization (Details)
Organization (Details) | May 26, 2016$ / shares | Jan. 31, 2006shares | Dec. 31, 2017$ / shares | Dec. 31, 2016$ / shares |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Common stock issued (in shares) | shares | 102,800 | |||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | |
Stock split, conversion ratio | 0.05 |
Summary of Significant Accoun54
Summary of Significant Accounting Policies (Narrative) (Details) - USD ($) shares in Millions | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Finite-Lived Intangible Assets [Line Items] | ||
Allowance for doubtful accounts | $ 48,201 | $ 106,205 |
Inventory reserve balance | 562,140 | 736,663 |
Impairment of inventory | 363,377 | 0 |
Patents, net of amortization | 1,470,796 | 1,647,505 |
Patent activity costs | 62,652 | 189,455 |
Product revenue | 642,179 | 1,699,802 |
Research, development and manufacturing operations | 4,820,536 | 6,627,249 |
Advertising expense | $ 189,382 | $ 2,164,693 |
Antidilutive securities excluded from computation of earnings per share (in shares) | 3,000 | 301.1 |
Patents [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Patents, net of amortization | $ 1,470,796 | $ 1,647,505 |
Amortization expense | 150,928 | 109,517 |
Patents [Member] | Awarded patents [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Patents, net of amortization | 640,167 | 619,241 |
Patents [Member] | Patent applications to be filed [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Patents, net of amortization | $ 830,629 | $ 1,028,264 |
Tertius Financial Group Pte. Ltd. [Member] | Chief Executive Officer [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Ownership percentage, related party | 50.00% |
Summary of Significant Accoun55
Summary of Significant Accounting Policies (Property, Plant and Equipment) (Details) | 12 Months Ended |
Dec. 31, 2017 | |
Buildings [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 40 years |
Manufacturing machinery and equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 5 years |
Manufacturing machinery and equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 10 years |
Furniture, fixtures, computer hardware/software [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 3 years |
Furniture, fixtures, computer hardware/software [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 7 years |
Summary of Significant Accoun56
Summary of Significant Accounting Policies (Future Amortization Expense of Patents) (Details) - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Finite-Lived Intangible Assets [Line Items] | ||
Total patent amortization expense | $ 1,470,796 | $ 1,647,505 |
Patents [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total patent amortization expense | 1,470,796 | 1,647,505 |
Awarded patents [Member] | Patents [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
2,018 | 173,439 | |
2,020 | 153,717 | |
2,021 | 130,885 | |
2,019 | 85,760 | |
2,022 | 56,099 | |
Thereafter | 40,267 | |
Total patent amortization expense | $ 640,167 | $ 619,241 |
Liquidity, Continued Operatio57
Liquidity, Continued Operations, and Going Concern (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
LIQUIDITY AND CONTINUED OPERATIONS [Abstract] | ||
Net cash used in operating activities | $ 12,597,929 | $ 16,855,484 |
Debt, principal | 5,461,819 | |
Notes payable, repayments of principal and interest | $ 700,000 |
Trade Receivables (Details)
Trade Receivables (Details) - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Receivables [Abstract] | ||
Accounts receivable | $ 6,658 | $ 549,204 |
Property, Plant and Equipment59
Property, Plant and Equipment (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Property, Plant and Equipment [Line Items] | ||
Depreciable property, plant and equipment | $ 36,645,862 | $ 36,639,460 |
Less: Accumulated depreciation and amortization | (32,013,686) | (30,983,448) |
Net property, plant and equipment | 4,632,176 | 5,656,012 |
Depreciation expense | 1,030,237 | 3,486,741 |
Building [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Depreciable property, plant and equipment | 5,828,960 | 5,828,960 |
Furniture, fixtures, computer hardware and computer software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Depreciable property, plant and equipment | 489,421 | 489,421 |
Manufacturing machinery and equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Depreciable property, plant and equipment | $ 30,327,481 | $ 30,321,079 |
Inventories (Details)
Inventories (Details) - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 689,000 | $ 833,000 |
Work in process | 12,000 | 635,000 |
Finished goods | 337,000 | 1,102,000 |
Total | $ 1,037,854 | $ 2,569,816 |
Notes Payable (Details)
Notes Payable (Details) | Sep. 30, 2017USD ($) | Sep. 27, 2017USD ($) | Feb. 24, 2017USD ($)note | Dec. 31, 2017USD ($)payment | Dec. 31, 2016USD ($) | Jun. 30, 2017USD ($) | Mar. 23, 2017USD ($) | Feb. 27, 2017USD ($) |
Debt Instrument [Line Items] | ||||||||
Interest paid | $ 1,221,843 | $ 417,876 | ||||||
Unsecured debt [Member] | Note Payable Conversion One [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Number of notes payable | note | 3 | |||||||
Notes payable | $ 765,784 | |||||||
Stated interest rate | 6.00% | |||||||
Interest accrued on convertible debt | 39,565 | |||||||
Unsecured debt [Member] | Note Payable Conversion Two [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Notes payable | $ 49,500 | |||||||
Stated interest rate | 6.00% | |||||||
Interest paid | $ 1,725 | |||||||
Unsecured debt [Member] | Note Payable Conversion Three [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Notes payable | $ 356,742 | |||||||
Stated interest rate | 5.00% | |||||||
Interest accrued on convertible debt | 13,830 | |||||||
Unsecured debt [Member] | Note Payable Conversion Four [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Notes payable | $ 250,000 | |||||||
Stated interest rate | 5.00% | |||||||
Interest accrued on convertible debt | 6,301 | |||||||
Unsecured debt [Member] | Note Payable Conversion Five [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Notes payable | $ 215,234 | 197,705 | ||||||
Stated interest rate | 5.00% | |||||||
Interest accrued on convertible debt | $ 2,540 | |||||||
Debt instrument, periodic payment | $ 18,426 | |||||||
Notes payable, monthly payments made | payment | 1 |
Debt (Narrative) (Details)
Debt (Narrative) (Details) - USD ($) | May 01, 2017 | Feb. 08, 2008 | Mar. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2009 |
Debt Instrument [Line Items] | |||||
Debt, principal | $ 5,461,819 | ||||
Construction Loan [Member] | |||||
Debt Instrument [Line Items] | |||||
Construction loan borrowing capacity | $ 7,500,000 | ||||
Permanent Loan [Member] | |||||
Debt Instrument [Line Items] | |||||
Stated interest rate | 6.60% | ||||
Interest accrued on convertible debt | $ 180,043 | ||||
Debt, principal | $ 5,704,932 | ||||
Debt instrument, periodic payment | $ 57,801 | ||||
Manufacturing and Office Facility [Member] | |||||
Debt Instrument [Line Items] | |||||
Cost of acquisition | $ 5,500,000 |
Debt (Schedule of Maturities of
Debt (Schedule of Maturities of Long-term Debt) (Details) | Dec. 31, 2017USD ($) |
Debt Disclosure [Abstract] | |
2,018 | $ 343,395 |
2,019 | 366,757 |
2,020 | 391,709 |
2,021 | 418,358 |
2,022 | 446,821 |
Thereafter | 3,494,779 |
Future principal payments on long-term debt, total | $ 5,461,819 |
Secured Promissory Note (Narrat
Secured Promissory Note (Narrative) (Details) | Dec. 28, 2017USD ($) | Dec. 15, 2017 | Dec. 06, 2017USD ($)shares | Nov. 30, 2017USD ($)installmentshares | Sep. 13, 2017USD ($)$ / shares | Aug. 10, 2017 | Jul. 24, 2017 | Dec. 31, 2017USD ($)$ / shares | Dec. 31, 2017USD ($)$ / shares | Oct. 31, 2017 |
Debt Instrument [Line Items] | ||||||||||
Note purchase and exchange agreement, amount authorized to be issued | $ 2,000,000 | |||||||||
Common stock, averaged daily trading volume | $ 50,000 | |||||||||
Trading day period preceding future tranche closing dates | 20 days | |||||||||
Ownership of outstanding stock, percentage | 3.00% | |||||||||
Derivative - expected annual volatility | 99.00% | 230.00% | 234.00% | |||||||
Secured Debt [Member] | Note Secured Promissory Agreement [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Aggregate principal amount of notes outstanding | $ 4,057,227 | $ 4,557,227 | $ 4,557,227 | |||||||
Stated interest rate | 12.00% | 12.00% | ||||||||
Debt instrument, convertible, conversion price, percentage of volume weighted average price (in dollars per share) | 85.00% | |||||||||
Measurement period after conversion date | 5 days | |||||||||
Conversion price (in dollars per share) | $ / shares | $ 0.002 | $ 0.002 | ||||||||
Ownership of outstanding stock, percentage | 9.99% | |||||||||
Accrued interest expense | $ 44,134 | $ 44,134 | ||||||||
Secured Debt [Member] | Note Secured Promissory Agreement, Maturing December 15, 2020 [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Aggregate principal amount of notes outstanding | $ 3,359,539 | |||||||||
Number of monthly installments | installment | 36 | |||||||||
Debt instrument, term | 3 years | |||||||||
Derivative - expected annual volatility | 63.00% | 63.00% | ||||||||
Derivative - present value of discount rate | 12.00% | 12.00% | ||||||||
Derivative - expected dividend rate | 0.00% | 0.00% | ||||||||
Derivative liability | $ 2,756,074 | |||||||||
Secured Debt [Member] | Note Secured Promissory Agreement, Maturing November 30, 2018 [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Aggregate principal amount of notes outstanding | $ 697,688 | 250,000 | $ 250,000 | |||||||
Debt instrument, term | 1 year | |||||||||
Derivative - expected annual volatility | 67.00% | 60.00% | ||||||||
Derivative - present value of discount rate | 12.00% | 12.00% | ||||||||
Derivative - expected dividend rate | 0.00% | 0.00% | ||||||||
Derivative liability | $ 943,735 | |||||||||
Secured Debt [Member] | Note Secured Promissory Agreement, Maturing December 28, 2018 [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Aggregate principal amount of notes outstanding | 250,000 | $ 250,000 | ||||||||
Debt instrument, term | 1 year | |||||||||
Derivative - expected annual volatility | 65.00% | |||||||||
Derivative - present value of discount rate | 12.00% | |||||||||
Derivative - expected dividend rate | 0.00% | |||||||||
Derivative liability | $ 267,008 | |||||||||
Debt instrument, unamortized discount | 250,000 | |||||||||
Interest expense | $ 17,008 | |||||||||
Unsecured debt [Member] | Promissory Note Three [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument, repurchase amount | 252,466 | |||||||||
Stated interest rate | 12.00% | |||||||||
Embedded Derivative Financial Instruments [Member] | Secured Debt [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Gain (loss) on embedded derivative, net | (930,361) | |||||||||
Embedded Derivative Financial Instruments [Member] | Secured Debt [Member] | Note Secured Promissory Agreement [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Derivative liability | 4,897,178 | 4,897,178 | ||||||||
Embedded Derivative Financial Instruments [Member] | Secured Debt [Member] | Note Secured Promissory Agreement, Maturing December 15, 2020 [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Derivative liability | 3,742,002 | 3,742,002 | ||||||||
Gain (loss) on embedded derivative, net | (985,928) | |||||||||
Embedded Derivative Financial Instruments [Member] | Secured Debt [Member] | Note Secured Promissory Agreement, Maturing November 30, 2018 [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Derivative liability | $ 888,168 | 888,168 | ||||||||
Gain (loss) on embedded derivative, net | $ 55,567 | |||||||||
Promissory note [Member] | Promissory Note Exchange Agreement [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument, repurchase amount | $ 3,359,539 | |||||||||
Aggregate principal amount of notes outstanding | $ 3,504,199 | |||||||||
Stated interest rate | 12.00% | |||||||||
Measurement period after conversion date | 5 days | |||||||||
Conversion price (in dollars per share) | $ / shares | $ 0.004 | |||||||||
Ownership of outstanding stock, percentage | 9.99% | |||||||||
Debt instrument, term | 3 years | |||||||||
Series J Preferred Stock [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Number of shares exchanged (in shares) | shares | 675 | 400 | ||||||||
Capital and accrued dividends | $ 755,417 | $ 445,222 |
Secured Promissory Note (Summar
Secured Promissory Note (Summary of Secured Promissory Note) (Details) - Secured Debt [Member] - USD ($) | Dec. 31, 2017 | Nov. 30, 2017 |
Note Secured Promissory Agreement, Maturing November 30, 2018 [Member] | ||
Debt Instrument [Line Items] | ||
Aggregate principal amount of notes outstanding | $ 250,000 | $ 697,688 |
Note Secured Promissory Agreement, Maturing December 28, 2018 [Member] | ||
Debt Instrument [Line Items] | ||
Aggregate principal amount of notes outstanding | $ 250,000 |
Promissory Notes (Details)
Promissory Notes (Details) | Nov. 16, 2017USD ($) | Oct. 06, 2017USD ($)shares | Sep. 13, 2017USD ($)note$ / shares | Jun. 30, 2017USD ($) | Apr. 06, 2017USD ($) | Jan. 19, 2017USD ($)shares | Dec. 06, 2016USD ($) | Dec. 31, 2017USD ($) | Oct. 31, 2016USD ($) | Aug. 31, 2017note | Apr. 30, 2017USD ($)note | Aug. 30, 2017USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Nov. 30, 2017USD ($) | Oct. 31, 2017USD ($) | May 08, 2017USD ($) | Aug. 29, 2016USD ($) |
Short-term Debt [Line Items] | ||||||||||||||||||
Interest paid | $ 1,221,843 | $ 417,876 | ||||||||||||||||
Ownership of outstanding stock, percentage | 3.00% | |||||||||||||||||
Amortization of debt discount | $ 4,427,086 | 6,214,060 | ||||||||||||||||
Promissory note [Member] | Promissory note [Member] | ||||||||||||||||||
Short-term Debt [Line Items] | ||||||||||||||||||
Stated interest rate | 12.00% | 12.00% | ||||||||||||||||
Number of promissory notes | note | 11 | |||||||||||||||||
Aggregate principal amount of notes outstanding | $ 3,400,000 | |||||||||||||||||
Number of promissory notes matured | note | 8 | |||||||||||||||||
Interest paid | $ 143,148 | |||||||||||||||||
Number of notes canceled | note | 11 | |||||||||||||||||
Promissory note [Member] | Promissory Note Exchange Agreement [Member] | ||||||||||||||||||
Short-term Debt [Line Items] | ||||||||||||||||||
Stated interest rate | 12.00% | |||||||||||||||||
Number of promissory notes | note | 1 | |||||||||||||||||
Aggregate principal amount of notes outstanding | $ 3,504,199 | |||||||||||||||||
Debt instrument, term | 3 years | |||||||||||||||||
Debt instrument, periodic payment, principal | $ 116,390 | |||||||||||||||||
Debt instrument, convertible, conversion price, milestone percentage one | 85.00% | |||||||||||||||||
Measurement period after conversion date | 5 days | |||||||||||||||||
Conversion price (in dollars per share) | $ / shares | $ 0.004 | |||||||||||||||||
Ownership of outstanding stock, percentage | 9.99% | |||||||||||||||||
Debt instrument, repurchase amount | $ 3,359,539 | |||||||||||||||||
Unsecured debt [Member] | Twelve Percent Unsecured Promissory Note From Private Investor [Member] | ||||||||||||||||||
Short-term Debt [Line Items] | ||||||||||||||||||
Stated interest rate | 12.00% | |||||||||||||||||
Debt, principal | $ 494,437 | $ 700,000 | $ 494,437 | |||||||||||||||
Interest paid | 45,414 | |||||||||||||||||
Proceeds from issuance of debt | 420,000 | |||||||||||||||||
Additional proceeds from issuance of debt | 250,000 | |||||||||||||||||
Amortization of debt discount | $ 30,000 | |||||||||||||||||
Debt instrument, payment plan, duration | 12 months | |||||||||||||||||
Debt instrument, periodic payment | $ 62,000 | |||||||||||||||||
Debt instrument, repurchased face amount | 205,563 | 205,563 | ||||||||||||||||
Interest payable, current | 27,126 | $ 27,126 | ||||||||||||||||
Common stock [Member] | Tertius Financial Group Pte. Ltd. [Member] | ||||||||||||||||||
Short-term Debt [Line Items] | ||||||||||||||||||
Issuance of common stock (in shares) | shares | 333,333,333 | |||||||||||||||||
Promissory note, accrued interest, current, retired for shares | $ 4,340 | |||||||||||||||||
Discount notes [Member] | Tertius Financial Group Pte. Ltd. [Member] | ||||||||||||||||||
Short-term Debt [Line Items] | ||||||||||||||||||
Proceeds from issuance of stock | $ 330,000 | |||||||||||||||||
Proceeds from promissory note | $ 200,000 | |||||||||||||||||
Debt, principal | 602,000 | |||||||||||||||||
Debt instrument, unamortized discount (premium), net | $ 60,000 | |||||||||||||||||
Discount notes [Member] | Common stock [Member] | Tertius Financial Group Pte. Ltd. [Member] | ||||||||||||||||||
Short-term Debt [Line Items] | ||||||||||||||||||
Stated interest rate | 6.00% | 6.00% | ||||||||||||||||
Promissory note, current, retired for shares | $ 600,000 | |||||||||||||||||
Unsecured debt [Member] | Promissory Note One [Member] | ||||||||||||||||||
Short-term Debt [Line Items] | ||||||||||||||||||
Stated interest rate | 10.00% | |||||||||||||||||
Debt, principal | $ 103,000 | |||||||||||||||||
Amortization of debt discount | 3,000 | |||||||||||||||||
Proceeds from issuance of unsecured debt | $ 100,000 | |||||||||||||||||
Short-term debt, accrued interest | $ 5,233 | |||||||||||||||||
Conversion of shares (in shares) | shares | 72,500,000 | |||||||||||||||||
Unsecured debt [Member] | Promissory Note Two [Member] | ||||||||||||||||||
Short-term Debt [Line Items] | ||||||||||||||||||
Stated interest rate | 12.00% | |||||||||||||||||
Debt, principal | $ 125,000 | |||||||||||||||||
Unsecured debt [Member] | Promissory Note Three [Member] | ||||||||||||||||||
Short-term Debt [Line Items] | ||||||||||||||||||
Stated interest rate | 12.00% | |||||||||||||||||
Debt, principal | $ 250,000 | |||||||||||||||||
Debt instrument, repurchase amount | $ 252,466 | |||||||||||||||||
Unsecured debt [Member] | Promissory Note Four [Member] | ||||||||||||||||||
Short-term Debt [Line Items] | ||||||||||||||||||
Proceeds from promissory note | $ 250,000 | |||||||||||||||||
Debt, principal | 275,000 | |||||||||||||||||
Debt instrument, unamortized discount (premium), net | $ 25,000 | |||||||||||||||||
Unsecured debt [Member] | Promissory Note Five [Member] | ||||||||||||||||||
Short-term Debt [Line Items] | ||||||||||||||||||
Proceeds from promissory note | $ 177,500 | |||||||||||||||||
Private Investor [Member] | ||||||||||||||||||
Short-term Debt [Line Items] | ||||||||||||||||||
Ownership percentage | 3.00% | 3.00% | ||||||||||||||||
Chief Executive Officer [Member] | Private Investor [Member] | ||||||||||||||||||
Short-term Debt [Line Items] | ||||||||||||||||||
Ownership percentage | 50.00% | 50.00% |
Series H Preferred Stock and 67
Series H Preferred Stock and July 2016 Convertible Notes (Series H Preferred Stock) (Details) - Series H Preferred Stock [Member] - USD ($) | Jul. 13, 2016 | Jun. 09, 2016 | Jul. 07, 2016 | Dec. 31, 2017 |
Class of Stock [Line Items] | ||||
Preferred stock, shares outstanding (in shares) | 830 | 0 | ||
Private placement [Member] | ||||
Class of Stock [Line Items] | ||||
Issuance of stock (in shares) | 2,500 | |||
Proceeds from issuance of stock | $ 2,500,000 | |||
Proceeds from issuance of preferred stock | $ 830,000 | $ 250,000 | $ 580,000 | |
Preferred stock, shares outstanding (in shares) | 830 |
Series H Preferred Stock and 68
Series H Preferred Stock and July 2016 Convertible Notes (July 2016 Convertible Notes) (Details) | Aug. 16, 2017 | Jul. 13, 2016USD ($)$ / sharesshares | May 31, 2017$ / wk | Aug. 30, 2017$ / wk | Aug. 15, 2017 | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Sep. 30, 2016USD ($) | Jun. 30, 2017USD ($) | Dec. 31, 2017USD ($)shares | Dec. 31, 2016USD ($) | Aug. 31, 2017 | May 02, 2017USD ($) | Oct. 10, 2016 |
Class of Stock [Line Items] | |||||||||||||||
Proceeds from issuance of private placement | $ 0 | $ 1,056,147 | |||||||||||||
Series H Preferred Stock [Member] | |||||||||||||||
Class of Stock [Line Items] | |||||||||||||||
Preferred stock, shares outstanding (in shares) | shares | 830 | 0 | |||||||||||||
Private placement [Member] | Series H Preferred Stock [Member] | |||||||||||||||
Class of Stock [Line Items] | |||||||||||||||
Preferred stock, shares outstanding (in shares) | shares | 830 | ||||||||||||||
Four Percent Original Issue Discount Senior Secured Convertible Promissory Notes [Member] | Private placement [Member] | |||||||||||||||
Class of Stock [Line Items] | |||||||||||||||
Aggregate principal amount of notes outstanding | $ 2,082,600 | ||||||||||||||
Stated interest rate | 4.00% | ||||||||||||||
Proceeds from issuance of stock | $ 364,000 | ||||||||||||||
Proceeds from convertible notes | 350,000 | ||||||||||||||
Debt instrument face amount, to be issued | 1,718,600 | ||||||||||||||
Proceeds from issuance of private placement | $ 1,650,000 | ||||||||||||||
April 2016 Rights Shares [Member] | Convertible Debt [Member] | |||||||||||||||
Class of Stock [Line Items] | |||||||||||||||
Capital and accrued dividends | 833,000 | ||||||||||||||
Convertible Notes, July 2016 [Member] | Convertible Debt [Member] | |||||||||||||||
Class of Stock [Line Items] | |||||||||||||||
Aggregate principal amount of notes outstanding | $ 866,000 | ||||||||||||||
Stated interest rate | 10.00% | 24.00% | |||||||||||||
Debt default, due upon default, percent | 25.00% | ||||||||||||||
Conversion price (in dollars per share) | $ / shares | $ 0.045 | ||||||||||||||
Debt instrument, convertible, conversion price, milestone percentage one | 70.00% | ||||||||||||||
Convertible debt, period prior to conversion date | 10 days | ||||||||||||||
Debt instrument, convertible, conversion price, milestone percentage two | 60.00% | ||||||||||||||
Convertible preferred stock, threshold consecutive trading days | 30 days | ||||||||||||||
Debt conversion, original debt, amount | $ 682,235 | $ 1,017,732 | $ 152,460 | $ 1,852,427 | $ 1,852,427 | ||||||||||
Debt conversion, interest, amount | 3,960 | ||||||||||||||
Debt instrument, periodic payment, principal | 1,096,600 | ||||||||||||||
Debt instrument, periodic payment, interest | 400,017 | ||||||||||||||
Convertible note, redemption penalty | 219,320 | ||||||||||||||
Convertible notes, credit to interest expense | 22,661 | ||||||||||||||
Convertible Notes Payable [Member] | Convertible Notes, July 2016 [Member] | |||||||||||||||
Class of Stock [Line Items] | |||||||||||||||
Stated interest rate | 10.00% | ||||||||||||||
Debt default, due upon default, percent | 24.00% | ||||||||||||||
Long-term debt, gross | $ 1,790,214 | ||||||||||||||
Debt instrument, redemption price, percentage | 125.00% | 120.00% | |||||||||||||
Debt instrument, convertible, conversion limitations | $ / wk | 50,000 | 75,000 | |||||||||||||
Embedded Derivative Financial Instruments [Member] | Private placement [Member] | Series H Preferred Stock [Member] | |||||||||||||||
Class of Stock [Line Items] | |||||||||||||||
Derivative liability | $ 3,733,348 | $ 3,733,348 | |||||||||||||
Gain (loss) on embedded derivative, net | $ 3,733,348 |
Series H Preferred Stock and 69
Series H Preferred Stock and July 2016 Convertible Notes (Summary of Conversions of July 2016 Convertible Notes) (Details) - Convertible Notes, July 2016 [Member] - Convertible Debt [Member] - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2017 | Dec. 31, 2017 | |
Class of Stock [Line Items] | |||||
Debt conversion, original debt, amount | $ 682,235 | $ 1,017,732 | $ 152,460 | $ 1,852,427 | $ 1,852,427 |
Debt conversion, converted instrument, shares issued (in shares) | 1,865,043,998 | 959,704,543 | 64,000,000 | 2,888,748,541 |
October 2016 Convertible Note70
October 2016 Convertible Notes and Exchange of Series A Preferred Stock (Details) - USD ($) | Dec. 15, 2017 | Aug. 10, 2017 | Jul. 24, 2017 | Oct. 05, 2016 | Dec. 31, 2017 | Dec. 31, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Oct. 06, 2016 |
Class of Stock [Line Items] | |||||||||
Derivative - expected annual volatility | 99.00% | 230.00% | 234.00% | ||||||
Series A Preferred Stock [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Preferred stock, shares outstanding (in shares) | 60,756 | 60,756 | 125,044 | 165,541 | |||||
October 2016 Convertible Notes [Member] | Convertible Debt [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Proceeds from issuance of stock | $ 330,000 | $ 330,000 | $ 330,000 | $ 330,000 | |||||
Proceeds from issuance of debt | $ 300,000 | ||||||||
Stated interest rate | 6.00% | ||||||||
Percent of average of two lowest volume weighted average prices | 80.00% | ||||||||
Convertible debt, trading days | 15 days | ||||||||
Interest accrued on convertible debt | $ 24,860 | ||||||||
Debt instrument, convertible, conversion price, milestone percentage one | 50.00% | ||||||||
Derivative liability | $ 330,000 | $ 544,746 | |||||||
Interest expense | $ 341,114 | ||||||||
Derivative - expected annual volatility | 65.00% | ||||||||
Derivative - present value of discount rate | 12.00% | ||||||||
Derivative - expected dividend rate | 0.00% | ||||||||
October 2016 Convertible Notes [Member] | Maximum [Member] | Convertible Debt [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Stated interest rate | 24.00% | ||||||||
Embedded Derivative Financial Instruments [Member] | October 2016 Convertible Notes [Member] | Convertible Debt [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Derivative liability | 572,643 | $ 572,643 | |||||||
Embedded Derivative Financial Instruments [Member] | Convertible Preferred Stock Subject to Mandatory Redemption [Member] | October 2016 Convertible Notes [Member] | Convertible Debt [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Gain (loss) on embedded derivative, net | $ 279,442 | $ 27,897 |
St. George Convertible Note (De
St. George Convertible Note (Details) - USD ($) | Dec. 15, 2017 | Sep. 11, 2017 | Aug. 10, 2017 | Jul. 24, 2017 | Jul. 13, 2016 | Dec. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Sep. 08, 2017 |
Debt Instrument [Line Items] | ||||||||||
Payments of financing costs | $ 20,000 | $ 81,500 | ||||||||
Ownership of outstanding stock, percentage | 3.00% | |||||||||
Derivative - expected annual volatility | 99.00% | 230.00% | 234.00% | |||||||
Convertible Debt [Member] | 2017 St. George Convertible Note [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Aggregate principal amount of notes outstanding | $ 1,725,000 | $ 1,705,833 | $ 1,705,833 | $ 1,705,833 | $ 1,725,000 | |||||
Proceeds from issuance of debt | 1,500,000 | |||||||||
Payments of financing costs | 20,000 | |||||||||
Debt instrument, unamortized discount | 225,000 | |||||||||
Debt instrument, maximum periodic payment allowable | $ 275,000 | |||||||||
Debt instrument, redemption price, premium | 15.00% | |||||||||
Debt instrument, convertible, conversion price, percentage of volume weighted average price (in dollars per share) | 85.00% | |||||||||
Measurement period after conversion date | 5 days | |||||||||
Conversion price (in dollars per share) | $ 0.004 | |||||||||
Stated interest rate | 22.00% | |||||||||
Debt instrument, event of default, increase in principal balance, percentage | 25.00% | |||||||||
Stock issued during the period, shares, debt origination fee (in shares) | 37,500,000 | |||||||||
Share price (in dollars per share) | $ 0.0017 | |||||||||
Interest expense | $ 63,750 | |||||||||
Ownership of outstanding stock, percentage | 4.99% | |||||||||
Shares of stock reserved for future issuance (in shares) | 1,880,000,000 | |||||||||
Repayments of Short-term Debt | 191,667 | |||||||||
Increase in shares reserved for future issuance (in shares) | 3,000,000,000 | |||||||||
Derivative liability | $ 468,095 | |||||||||
Derivative - expected annual volatility | 62.00% | |||||||||
Derivative - present value of discount rate | 12.00% | |||||||||
Derivative - expected dividend rate | 0.00% | |||||||||
Convertible Debt [Member] | 2017 St. George Convertible Note [Member] | Debt Instrument, Redemption, Period One [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument, periodic payment, principal | 96,000 | |||||||||
Convertible Debt [Member] | 2017 St. George Convertible Note [Member] | Debt Instrument, Redemption, Period Two [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument, periodic payment, principal | $ 150,000 | |||||||||
Embedded Derivative Financial Instruments [Member] | Convertible Debt [Member] | 2017 St. George Convertible Note [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Derivative liability | $ 394,280 | 394,280 | $ 394,280 | |||||||
Gain (loss) on embedded derivative, net | $ (151,504) | $ 73,815 |
Baybridge Convertible Note (Det
Baybridge Convertible Note (Details) - USD ($) | Dec. 15, 2017 | Dec. 06, 2017 | Nov. 30, 2017 | Aug. 10, 2017 | Jul. 24, 2017 | Dec. 31, 2017 | Dec. 31, 2016 |
Debt Instrument [Line Items] | |||||||
Ownership of outstanding stock, percentage | 3.00% | ||||||
Derivative - expected annual volatility | 99.00% | 230.00% | 234.00% | ||||
Baybridge Convertible Note [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, unamortized discount | $ 565,000 | $ 0 | |||||
Convertible notes | 0 | $ 0 | |||||
Convertible Debt [Member] | Baybridge Convertible Note [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Aggregate principal amount of notes outstanding | $ 840,000 | $ 565,000 | |||||
Stated interest rate | 12.00% | ||||||
Debt instrument, unamortized discount | $ 84,583 | ||||||
Debt instrument, convertible, conversion price, percentage of volume weighted average price (in dollars per share) | 85.00% | ||||||
Measurement period after conversion date | 5 days | ||||||
Conversion price (in dollars per share) | $ 0.003 | ||||||
Ownership of outstanding stock, percentage | 9.99% | ||||||
Derivative liability | $ 1,048,311 | ||||||
Convertible notes | 755,417 | ||||||
Interest expense | $ 292,894 | ||||||
Derivative - expected annual volatility | 61.00% | ||||||
Derivative - present value of discount rate | 12.00% | ||||||
Derivative - expected dividend rate | 0.00% | ||||||
Debt instrument, repurchased face amount | $ 275,000 | ||||||
Debt conversion, converted instrument, shares issued (in shares) | 404,411,765 | ||||||
Short-term debt, accrued interest | $ 4,825 | ||||||
Embedded Derivative Financial Instruments [Member] | Convertible Debt [Member] | Baybridge Convertible Note [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Derivative liability | 542,733 | ||||||
Gain (loss) on embedded derivative, net | $ 505,578 | ||||||
Series J Preferred Stock [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Preferred stock, shares outstanding (in shares) | 675 | 400 | |||||
Capital and accrued dividends | $ 755,417 | $ 445,222 |
Series A Preferred Stock (Detai
Series A Preferred Stock (Details) - USD ($) | Jun. 17, 2017 | Aug. 31, 2016 | Jun. 30, 2013 | Mar. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Oct. 06, 2016 | Aug. 31, 2013 | Jun. 17, 2013 |
Series A Preferred Stock [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Preferred stock, shares issued (in shares) | 750,000 | 750,000 | 750,000 | 625,000 | 125,000 | ||||
Share price (in dollars per share) | $ 8 | ||||||||
Preferred stock, value, issued | $ 6,000,000 | $ 6 | $ 13 | ||||||
Preferred stock, dividend rate | 8.00% | ||||||||
Preferred stock, dividend, make-whole dividend rate to market value | 10.00% | ||||||||
Preferred stock, dividend issuance term | 4 years | ||||||||
Preferred stock, redemption, term, required make-whole dividend | 4 years | ||||||||
Preferred stock, conversion, required common share price (in dollars per share) | $ 232 | ||||||||
Preferred stock, conversion, required common share price, term | 20 days | ||||||||
Convertible preferred stock, shares issued upon conversion (in shares) | 1 | ||||||||
Preferred stock, shares outstanding (in shares) | 60,756 | 125,044 | 165,541 | ||||||
Shares converted (in shares) | 104,785 | ||||||||
Stock dividends (in shares) | 173,946,250 | ||||||||
Accrued and unpaid dividends | $ 279,815 | ||||||||
Common stock [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Number of securities called by warrants (in shares) | 13,125 | 10,938 | 2,187 | ||||||
Proceeds from issuance of preferred stock | $ 1,000,000 | $ 5,000,000 | |||||||
Series A, Buyer [Member] | Series A Preferred Stock [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Preferred stock, shares outstanding (in shares) | 104,785 |
Series E Preferred Stock and 74
Series E Preferred Stock and the Committed Equity Line (Series E Preferred Stock) (Details) - Series E Preferred Stock [Member] | Nov. 04, 2015USD ($)priceshares | Sep. 30, 2017USD ($) | Sep. 30, 2017USD ($) | Dec. 31, 2017USD ($)shares | Dec. 31, 2016USD ($) |
Class of Stock [Line Items] | |||||
Percent of two lowest volume weighted average prices | 80.00% | ||||
Component of purchase price calculation | price | 2 | ||||
Measurement period after conversion date | 10 days | ||||
Percent of two lowest volume weighted average prices - in default | 70.00% | ||||
Measurement period before conversion date - in default | 20 days | ||||
Preferred stock, dividend rate | 7.00% | ||||
Dividends, preferred stock, paid-in-kind | $ 11,948 | ||||
Preferred dividends, cash | $ 2,013 | ||||
Stock dividends (in shares) | shares | 25,160,171 | ||||
Private placement [Member] | |||||
Class of Stock [Line Items] | |||||
Proceeds from issuance of stock | $ 2,800,000 | ||||
Shares issued as commitment fee | shares | 18,000 | ||||
Gross debt issuance cost | $ 104,000 | ||||
Private placement [Member] | Embedded Derivative Financial Instruments [Member] | |||||
Class of Stock [Line Items] | |||||
Derivative liability | $ 140,748 | ||||
Gain (loss) on embedded derivative, net | $ 121,390 | $ 140,748 | |||
Convertible Debt [Member] | |||||
Class of Stock [Line Items] | |||||
Issuance of stock (in shares) | shares | 2,800 |
Series E Preferred Stock and 75
Series E Preferred Stock and the Committed Equity Line (Summary of the Conversion Activity of Series E Preferred Stock) (Details) - Series E Preferred Stock [Member] - USD ($) | 3 Months Ended | 24 Months Ended | |||||||
Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2017 | |
Class of Stock [Line Items] | |||||||||
Shares converted (in shares) | 70 | 35 | 15 | 94 | 523 | 365 | 1,220 | 478 | 2,800 |
Stock issued in lieu of cash, value | $ 76,814 | $ 38,886 | $ 16,248 | $ 101,018 | $ 548,896 | $ 381,414 | $ 1,239,436 | $ 481,500 | $ 2,884,212 |
Conversion of shares (in shares) | 129,314,677 | 134,927,207 | 8,289,962 | 13,089,675 | 21,973,747 | 7,979,568 | 1,132,000 | 250,000 | 316,956,836 |
Series E Preferred Stock and 76
Series E Preferred Stock and the Committed Equity Line (Committed Equity Line) (Details) - Committed Equity Line [Member] | Nov. 10, 2015USD ($)priceshares | Dec. 31, 2017USD ($)shares | Dec. 31, 2016USD ($) |
Class of Stock [Line Items] | |||
Proceeds from issuance of stock | $ 1,056,147 | ||
Common stock [Member] | |||
Class of Stock [Line Items] | |||
Common stock, subscriptions, period following registration date | 36 months | ||
Percent of average trading volume of common stock | 300.00% | ||
Threshold consecutive trading days | 10 days | ||
Purchase price calculation, percent | 80.00% | ||
Component of purchase price calculation | price | 2 | ||
Proceeds from issuance of stock | $ 3,056,147 | ||
Issuance of stock (in shares) | shares | 1,368,000 | ||
Percent of outstanding shares of stock | 9.99% | ||
Shares issued as commitment fee | shares | 132,000 | ||
Maximum [Member] | Common stock [Member] | |||
Class of Stock [Line Items] | |||
Common stock, value, subscriptions | $ 32,200,000 | ||
Obligatory purchased of common stock | $ 1,000,000 |
Series F Preferred Stock (Narra
Series F Preferred Stock (Narrative) (Details) - Series F Preferred Stock [Member] | Oct. 05, 2016USD ($) | Jun. 09, 2016 | Jan. 20, 2016USD ($)paymentshares | Jan. 19, 2016USD ($)price$ / sharesshares | Dec. 31, 2017USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) |
Class of Stock [Line Items] | |||||||
Measurement period before conversion date - in default | 20 days | ||||||
Preferred stock, outstanding | $ 336,000 | ||||||
Debt instrument, convertible, conversion price, milestone percentage one | 50.00% | ||||||
Convertible debt, period after conversion date | 10 days | ||||||
Private placement [Member] | |||||||
Class of Stock [Line Items] | |||||||
Proceeds from issuance of stock | $ 7,000,000 | ||||||
Issuance of stock (in shares) | shares | 7,000 | ||||||
Proceeds from issuance of preferred stock | $ 500,000 | ||||||
Preferred stock, value, subscriptions | $ 6,500,000 | ||||||
Preferred stock, subscriptions, number of payments | payment | 14 | ||||||
Preferred stock, value, subscription payments, tranche two | $ 500,000 | ||||||
Preferred stock, value, subscription payments, tranche one | $ 250,000 | ||||||
Convertible preferred stock, conversion price (in dollars per share) | $ / shares | $ 5 | ||||||
Percent of two lowest volume weighted average prices - in default | 70.00% | ||||||
Component of purchase price calculation | price | 2 | ||||||
Measurement period before conversion date - in default | 20 days | ||||||
Subscription, weekly redemption amount (in shares) | shares | 250 | ||||||
Preferred stock, redemption price per share (in dollars per share) | $ / shares | $ 1,250 | ||||||
Percent of average of 2 lowest volume weighted average prices | 80.00% | ||||||
Threshold consecutive trading days | 10 days | ||||||
Subscription terms, weekly redemption as a percent of common stock | 12.00% | ||||||
Convertible preferred stock, conversion price, milestone percentage one | 70.00% | ||||||
Convertible debt, period prior to conversion date | 10 days | ||||||
Preferred stock, dividend rate | 7.00% | ||||||
Embedded Derivative Financial Instruments [Member] | Private placement [Member] | |||||||
Class of Stock [Line Items] | |||||||
Derivative liability | $ 1,666,000 | $ 255,324 | |||||
Gain (loss) on embedded derivative, net | $ 42,347 | $ 255,324 |
Series F Preferred Stock (Summa
Series F Preferred Stock (Summary of Conversion Activity of Series F Preferred Stock) (Details) - Series F Preferred Stock [Member] - USD ($) | 3 Months Ended | 24 Months Ended | |||||
Dec. 31, 2017 | Sep. 30, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | |
Class of Stock [Line Items] | |||||||
Shares converted (in shares) | 107,000 | 20,000 | 175,949 | 1,261,648 | 3,234,000 | 2,168,402 | 6,966,999 |
Stock issued in lieu of cash, value | $ 467 | $ 0 | $ 9,168 | $ 54,096 | $ 66,931 | $ 19,896 | $ 150,558 |
Conversion of shares (in shares) | 172,552,354 | 18,181,818 | 27,276,006 | 81,917,367 | 6,649,741 | 2,183,991 | 308,761,277 |
Series G Preferred Stock (Narra
Series G Preferred Stock (Narrative) (Details) | Jun. 30, 2017USD ($)installment | Jun. 30, 2017USD ($)shares | Jan. 17, 2017USD ($)$ / sharesshares | Sep. 21, 2016$ / shares | Apr. 29, 2016$ / shares | Jun. 30, 2017USD ($)shares | Mar. 31, 2017shares | Dec. 31, 2016USD ($)shares | Jun. 30, 2016USD ($)shares | Jun. 30, 2017USD ($)shares | Dec. 31, 2017USD ($)$ / sharesshares | Mar. 17, 2017$ / shares | Sep. 19, 2016investor$ / shares |
Class of Stock [Line Items] | |||||||||||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.0001 | ||||||||||||
Series G Preferred Stock [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Sale of stock, price per share (in dollars per share) | $ / shares | $ 1,000 | ||||||||||||
Preferred stock, shares outstanding (in shares) | shares | 0 | ||||||||||||
Shares converted (in shares) | shares | 210 | 526,000 | 372,000 | 892,000 | 1,790,000 | ||||||||
Preferred stock, redemption amount | $ | $ 232,440 | $ 232,440 | $ 232,440 | $ 232,440 | |||||||||
Conversion of shares (in shares) | shares | 1,337,776,821 | 327,718,386 | 245,726,283 | 1,911,221,490 | |||||||||
Private placement [Member] | Series G Preferred Stock [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Issuance of stock (in shares) | shares | 2,000 | ||||||||||||
Proceeds from issuance of stock | $ | $ 2,000,000 | ||||||||||||
Preferred stock, dividend rate | 10.00% | ||||||||||||
Number of investors | investor | 2 | ||||||||||||
Preferred stock, outstanding | $ | $ 1,795,000 | ||||||||||||
Convertible preferred stock, conversion price (in dollars per share) | $ / shares | $ 0.045 | $ 1 | |||||||||||
Convertible preferred stock, conversion price, milestone percentage one | 70.00% | ||||||||||||
Threshold consecutive trading days | 10 days | ||||||||||||
Embedded Derivative Financial Instruments [Member] | Private placement [Member] | Series G Preferred Stock [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Derivative liability | $ | $ 361,831 | ||||||||||||
Gain (loss) on embedded derivative, net | $ | $ 361,831 | ||||||||||||
Series G Private Investor [Member] | Private placement [Member] | Series G Preferred Stock [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Issuance of stock (in shares) | shares | 2,000 | ||||||||||||
Preferred stock, shares outstanding (in shares) | shares | 1,795 | ||||||||||||
Series G Purchasers [Member] | Series G Preferred Stock [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Sale of stock, price per share (in dollars per share) | $ / shares | $ 1,000 | ||||||||||||
Holder A [Member] | Private placement [Member] | Series G Preferred Stock [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Convertible preferred stock, conversion price (in dollars per share) | $ / shares | $ 0.00112 | $ 0.00168 | |||||||||||
Shares converted (in shares) | shares | 100 | ||||||||||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 100,000 | ||||||||||||
Interest accrued on convertible debt | $ | $ 6,147 | ||||||||||||
Conversion of shares (in shares) | shares | 95,014,884 | ||||||||||||
Convertible preferred stock, conversion price, minimum disposal (in dollars per share) | $ / shares | $ 0.003 | ||||||||||||
Inducement conversion costs | $ | $ 79,179 | ||||||||||||
Convertible preferred stock, conversion expense, minimum disposal | $ | $ 134,566 | ||||||||||||
Number of monthly installments | installment | 3 |
Series G Preferred Stock (Summa
Series G Preferred Stock (Summary of Conversion of Series G Preferred Stock) (Details) - Series G Preferred Stock [Member] - USD ($) | Jun. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2017 |
Class of Stock [Line Items] | |||||
Shares converted (in shares) | 210 | 526,000 | 372,000 | 892,000 | 1,790,000 |
Stock issued in lieu of cash, value | $ 49,096 | $ 25,970 | $ 37,895 | $ 112,961 | |
Conversion of shares (in shares) | 1,337,776,821 | 327,718,386 | 245,726,283 | 1,911,221,490 |
Series I Preferred Stock and 81
Series I Preferred Stock and Series I Convertible Notes (Narrative) (Details) - USD ($) | Jul. 31, 2017 | Sep. 13, 2016 | Jul. 26, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Oct. 31, 2016 |
Class of Stock [Line Items] | ||||||
Cash paid for interest | $ 1,221,843 | $ 417,876 | ||||
Series I Preferred Stock [Member] | ||||||
Class of Stock [Line Items] | ||||||
Preferred stock, shares outstanding (in shares) | 0 | |||||
Private placement [Member] | Series I Preferred Stock [Member] | ||||||
Class of Stock [Line Items] | ||||||
Securities purchase agreement, number of shares authorized | 1,000 | |||||
Issuance of stock (in shares) | 536 | |||||
Proceeds from issuance of stock | $ 536,000 | |||||
Convertible Debt [Member] | Exchange Convertible Notes [Member] | ||||||
Class of Stock [Line Items] | ||||||
Exchange convertible notes | 332,633 | |||||
Stated interest rate | 10.00% | |||||
Convertible debt, period prior to conversion date | 10 days | |||||
Debt instrument, convertible, conversion price, milestone percentage one | 70.00% | |||||
Cash paid for interest | $ 5,255 | |||||
Maximum [Member] | Convertible Debt [Member] | Exchange Convertible Notes [Member] | ||||||
Class of Stock [Line Items] | ||||||
Stated interest rate | 24.00% | |||||
Embedded Derivative Financial Instruments [Member] | Convertible Debt [Member] | Exchange Convertible Notes [Member] | ||||||
Class of Stock [Line Items] | ||||||
Derivative liability | $ 196,617 | |||||
Gain (loss) on embedded derivative, net | $ 196,617 | |||||
Series I Seller [Member] | Private placement [Member] | Series I Preferred Stock [Member] | ||||||
Class of Stock [Line Items] | ||||||
Preferred stock, shares outstanding (in shares) | 326 | 326 | 326 | |||
Series I Purchaser [Member] | Private placement [Member] | Series I Preferred Stock [Member] | ||||||
Class of Stock [Line Items] | ||||||
Preferred stock, outstanding | $ 326,000 | $ 332,633 | ||||
Accrued dividends | $ 6,633 | |||||
Series I Purchaser [Member] | Convertible Debt [Member] | Exchange Convertible Notes [Member] | ||||||
Class of Stock [Line Items] | ||||||
Sale of stock, price per share (in dollars per share) | $ 1,000 |
Series I Preferred Stock and 82
Series I Preferred Stock and Series I Convertible Notes (Schedule of Conversion Activity of the Exchange Convertible Notes) (Details) - Convertible Debt [Member] - Exchange Convertible Notes [Member] - USD ($) | 3 Months Ended | 15 Months Ended | ||||
Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Sep. 30, 2017 | |
Class of Stock [Line Items] | ||||||
Debt conversion, original debt, amount | $ 118,535 | $ 37,535 | $ 70,000 | $ 91,563 | $ 15,000 | $ 332,633 |
Debt conversion, converted instrument, accrued interest | $ 10,268 | $ 0 | $ 0 | $ 0 | $ 0 | $ 10,268 |
Debt conversion, converted instrument, shares issued (in shares) | 306,675,548 | 86,987,428 | 50,503,662 | 13,346,274 | 1,470,588 | 458,983,500 |
Series J Preferred Stock and 83
Series J Preferred Stock and Series J-1 Preferred Stock (Details) - USD ($) | Dec. 06, 2017 | Nov. 30, 2017 | Aug. 10, 2017 | May 08, 2017 | Mar. 29, 2017 | Mar. 24, 2017 | Oct. 14, 2016 | Sep. 19, 2016 | Oct. 31, 2016 | Dec. 31, 2017 | Dec. 15, 2017 | Jul. 24, 2017 | Apr. 04, 2017 | Dec. 31, 2016 |
Class of Stock [Line Items] | ||||||||||||||
Common stock, value, issued | $ 960,660 | $ 55,422 | ||||||||||||
Warrants and rights outstanding | $ 246,803 | $ 10,035 | $ 88,937 | |||||||||||
Ownership of outstanding stock, percentage | 3.00% | |||||||||||||
Private placement [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Warrants and rights outstanding | $ 250,000,000 | |||||||||||||
Investment warrants, exercise price (in dollars per share) | $ 0.003 | |||||||||||||
Ownership of outstanding stock, percentage | 9.99% | |||||||||||||
Series J Preferred Stock [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Preferred stock, shares outstanding (in shares) | 0 | 1,350 | ||||||||||||
Preferred stock, dividend rate | 10.00% | |||||||||||||
Conversion of shares (in shares) | 189,484,143 | 125,429,895 | 71,636,432 | |||||||||||
Number of shares exchanged (in shares) | 675 | 400 | ||||||||||||
Amount exchanged | $ 675,000 | $ 400,000 | ||||||||||||
Accrued dividends | $ 80,417 | $ 45,222 | ||||||||||||
Series J Preferred Stock [Member] | Private placement [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Proceeds from issuance of stock | $ 1,350,000 | $ 1,350,000 | ||||||||||||
Issuance of stock (in shares) | 1,350 | |||||||||||||
Convertible preferred stock, conversion price (in dollars per share) | $ 0.00028 | $ 0.00105 | $ 0.00147 | $ 0.015 | ||||||||||
Shares converted (in shares) | 50 | 125 | 100 | 275 | ||||||||||
Share price, discount, percent | 30.00% | 30.00% | 30.00% | |||||||||||
Inducement conversion costs | $ 92,974 | $ 186,640 | $ 142,155 | |||||||||||
Convertible debt, period prior to conversion date | 10 days | 10 days | ||||||||||||
Series J-1 Preferred Stock [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Preferred stock, shares outstanding (in shares) | 0 | 700 | ||||||||||||
Preferred stock, dividend rate | 10.00% | |||||||||||||
Preferred stock, redemption price per share (in dollars per share) | $ 1,000 | |||||||||||||
Series J-1 Preferred Stock [Member] | Private placement [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Proceeds from issuance of stock | $ 1,000,000 | |||||||||||||
Issuance of stock (in shares) | 700 | |||||||||||||
Convertible preferred stock, conversion price (in dollars per share) | $ 0.0125 | |||||||||||||
Securities purchase agreement, number of shares authorized | 1,000 | |||||||||||||
Proceeds from issuance of preferred stock | $ 700,000 | $ 700,000 | ||||||||||||
Dividends payable | 55,305 | |||||||||||||
Common stock, value, issued | $ 500,000,000 | |||||||||||||
Series J Seller [Member] | Series J Preferred Stock [Member] | Private placement [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Preferred stock, shares outstanding (in shares) | 250 | 850 | 600 | |||||||||||
Sale of stock, price per share (in dollars per share) | $ 1,000 | $ 1,000 | $ 1,000 | |||||||||||
Series J Purchaser [Member] | Series J Preferred Stock [Member] | Private placement [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Preferred stock, outstanding | $ 850,000 | |||||||||||||
Embedded Derivative Financial Instruments [Member] | Series J Preferred Stock [Member] | Private placement [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Derivative liability | $ 705,024 | |||||||||||||
Gain (loss) on embedded derivative, net | $ 705,024 |
Series K Preferred Stock (Narra
Series K Preferred Stock (Narrative) (Details) - Series K Preferred Stock [Member] - USD ($) | Jun. 27, 2017 | Feb. 24, 2017 | Feb. 08, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Sep. 30, 2017 | Dec. 31, 2017 | Dec. 31, 2016 |
Class of Stock [Line Items] | |||||||||
Proceeds from issuance of preferred stock | $ 4,760,000 | $ 4,100,000 | $ 150,000 | $ 9,010,000 | |||||
Preferred stock, shares issued (in shares) | 4,760 | 4,100 | 150 | 4,760 | 2,810 | 0 | |||
Ownership percentage | 19.99% | 16.00% | |||||||
Preferred stock, shares outstanding (in shares) | 2,810 | 0 | |||||||
Preferred stock, value, issued | $ 2,810,000 | ||||||||
Private placement [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Issuance of common stock | $ 20,000,000 | ||||||||
Issuance of stock (in shares) | 15,000 | 1,000 | |||||||
Proceeds from issuance of preferred stock | $ 15,000,000 | $ 1,000,000 | $ 9,010,000 | ||||||
Preferred stock, shares issued (in shares) | 9,010 | 9,010 | 9,010 | ||||||
Convertible preferred stock, conversion price (in dollars per share) | $ 0.004 | ||||||||
Preferred stock, redemption price per share (in dollars per share) | $ 1,000 |
Series K Preferred Stock (Summa
Series K Preferred Stock (Summary of Closings and Proceeds Received) (Details) - Series K Preferred Stock [Member] - USD ($) | Jun. 27, 2017 | Feb. 24, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Sep. 30, 2017 | Dec. 31, 2017 | Dec. 31, 2016 |
Class of Stock [Line Items] | ||||||||
Preferred stock, shares issued (in shares) | 4,760 | 4,100 | 150 | 4,760 | 2,810 | 0 | ||
Proceeds from issuance of preferred stock | $ 4,760,000 | $ 4,100,000 | $ 150,000 | $ 9,010,000 | ||||
Private placement [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Preferred stock, shares issued (in shares) | 9,010 | 9,010 | 9,010 | |||||
Proceeds from issuance of preferred stock | $ 15,000,000 | $ 1,000,000 | $ 9,010,000 |
Series K Preferred Stock (Sum86
Series K Preferred Stock (Summary of Conversion Activity of Series K Preferred Stock) (Details) - Series K Preferred Stock [Member] - USD ($) | 3 Months Ended | 6 Months Ended | |
Sep. 30, 2017 | Jun. 30, 2017 | Sep. 30, 2017 | |
Class of Stock [Line Items] | |||
Shares converted (in shares) | 3,000 | 3,200 | 6,200 |
Stock issued in lieu of cash, value | $ 3,000,000 | $ 3,200,000 | $ 6,200,000 |
Conversion of shares (in shares) | 750,000,000 | 800,000,000 | 1,550,000,000 |
Make-Whole Dividend Liability (
Make-Whole Dividend Liability (Details) - Series A Preferred Stock [Member] - USD ($) | 1 Months Ended | 4 Months Ended | |
Jun. 30, 2013 | Mar. 31, 2017 | Jun. 17, 2017 | |
Class of Stock [Line Items] | |||
Preferred stock, dividend rate | 8.00% | ||
Preferred stock, redemption, term, required make-whole dividend | 4 years | ||
Preferred stock, dividend, make-whole dividend rate to market value | 10.00% | ||
Shares converted (in shares) | 104,785 | ||
Dividends, common stock, paid-in-kind | $ 419,140 | ||
Stock dividends (in shares) | 173,946,250 | ||
Accrued interest and dividends | $ 274,583 |
Stockholders' Equity (Deficit88
Stockholders' Equity (Deficit) (Common Stock) (Details) | 12 Months Ended | ||
Dec. 31, 2017vote$ / sharesshares | Dec. 31, 2016$ / sharesshares | May 26, 2016$ / shares | |
Equity [Abstract] | |||
Common stock, shares authorized (in shares) | 20,000,000,000 | 2,000,000,000 | |
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Common stock, number of votes per share | vote | 1 | ||
Common stock, shares outstanding (in shares) | 9,606,597,777 | 554,223,320 |
Stockholders' Equity (Deficit89
Stockholders' Equity (Deficit) (Preferred Stock) (Details) - $ / shares | Dec. 31, 2017 | Dec. 31, 2016 | Oct. 06, 2016 | Jul. 13, 2016 |
Class of Stock [Line Items] | ||||
Preferred stock, par value (in dollars per share) | $ 0.0001 | |||
Preferred stock, shares authorized (in shares) | 25,000,000 | |||
Series A Preferred Stock [Member] | ||||
Class of Stock [Line Items] | ||||
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | ||
Preferred stock, shares authorized (in shares) | 750,000 | 750,000 | ||
Preferred stock, shares outstanding (in shares) | 60,756 | 125,044 | 165,541 | |
Series B-1 Preferred Stock [Member] | ||||
Class of Stock [Line Items] | ||||
Preferred stock, shares authorized (in shares) | 2,000 | |||
Preferred stock, shares outstanding (in shares) | 0 | |||
Series B-2 Preferred Stock [Member] | ||||
Class of Stock [Line Items] | ||||
Preferred stock, shares authorized (in shares) | 1,000 | |||
Preferred stock, shares outstanding (in shares) | 0 | |||
Series C Preferred Stock [Member] | ||||
Class of Stock [Line Items] | ||||
Preferred stock, shares authorized (in shares) | 1,000 | |||
Preferred stock, shares outstanding (in shares) | 0 | |||
Series D Preferred Stock [Member] | ||||
Class of Stock [Line Items] | ||||
Preferred stock, shares authorized (in shares) | 3,000 | |||
Preferred stock, shares outstanding (in shares) | 0 | |||
Series D-1 Preferred Stock [Member] | ||||
Class of Stock [Line Items] | ||||
Preferred stock, shares authorized (in shares) | 2,500 | |||
Preferred stock, shares outstanding (in shares) | 0 | |||
Series E Preferred Stock [Member] | ||||
Class of Stock [Line Items] | ||||
Preferred stock, shares authorized (in shares) | 2,800 | |||
Preferred stock, shares outstanding (in shares) | 0 | |||
Series F Preferred Stock [Member] | ||||
Class of Stock [Line Items] | ||||
Preferred stock, shares authorized (in shares) | 7,000 | |||
Preferred stock, shares outstanding (in shares) | 0 | |||
Series G Preferred Stock [Member] | ||||
Class of Stock [Line Items] | ||||
Preferred stock, shares authorized (in shares) | 2,000 | |||
Preferred stock, shares outstanding (in shares) | 0 | |||
Series H Preferred Stock [Member] | ||||
Class of Stock [Line Items] | ||||
Preferred stock, shares authorized (in shares) | 2,500 | |||
Preferred stock, shares outstanding (in shares) | 0 | 830 | ||
Series I Preferred Stock [Member] | ||||
Class of Stock [Line Items] | ||||
Preferred stock, shares authorized (in shares) | 1,000 | |||
Preferred stock, shares outstanding (in shares) | 0 | |||
Series J Preferred Stock [Member] | ||||
Class of Stock [Line Items] | ||||
Preferred stock, shares authorized (in shares) | 1,350 | 1,350 | ||
Preferred stock, shares outstanding (in shares) | 0 | 1,350 | ||
Series J-1 Preferred Stock [Member] | ||||
Class of Stock [Line Items] | ||||
Preferred stock, shares authorized (in shares) | 1,000 | 1,000 | ||
Preferred stock, shares outstanding (in shares) | 0 | 700 | ||
Series K Preferred Stock [Member] | ||||
Class of Stock [Line Items] | ||||
Preferred stock, shares authorized (in shares) | 20,000 | 0 | ||
Preferred stock, shares outstanding (in shares) | 2,810 | 0 |
Stockholders' Equity (Deficit90
Stockholders' Equity (Deficit) (Warrants) (Details) - USD ($) | Dec. 15, 2017 | Aug. 10, 2017 | Jul. 24, 2017 | Dec. 31, 2017 | Dec. 31, 2016 |
Equity [Abstract] | |||||
Class of warrant or right, outstanding (in shares) | 200,000,000 | 250,000,000 | 250,000,000 | 700,000,000 | 0 |
Exercise price of warrants (in dollars per share) | $ 0.0018 | $ 0.003 | $ 0.004 | ||
Class Of warrants and rights, maximum ownership percentage threshold for conversion | 9.99% | 9.99% | 9.99% | ||
Fair value adjustments, stock price (in dollars per share) | $ 0.0008 | $ 0.0015 | $ 0.0007 | ||
Derivative - expected annual volatility | 99.00% | 230.00% | 234.00% | ||
Fair value assumptions, risk free interest rate | 1.48% | 1.22% | 1.23% | ||
Warrants and rights outstanding | $ 10,035 | $ 246,803 | $ 88,937 |
Stockholders' Equity (Deficit91
Stockholders' Equity (Deficit) (Summary of Warrant Activity) (Details) | 12 Months Ended |
Dec. 31, 2017$ / sharesshares | |
Warrant Shares [Abstract] | |
Outstanding at December 31, 2016 (in shares) | shares | 0 |
Granted (in shares) | shares | 700,000,000 |
Exercised (in shares) | shares | 0 |
Canceled (in shares) | shares | 0 |
Outstanding at December 31, 2017 (in shares) | shares | 700,000,000 |
Exercisable at December 31, 2017 (in shares) | shares | 700,000,000 |
Warrant Weighted Average Exercise Price | |
Outstanding at December 31, 2016 (in dollars per share) | $ / shares | $ 0 |
Granted (in dollars per share) | $ / shares | 0.003 |
Exercised (in dollars per share) | $ / shares | 0 |
Canceled (in dollars per share) | $ / shares | 0 |
Outstanding at December 31, 2017 (in dollars per share) | $ / shares | 0.003 |
Exercisable at December 31, 2017 (in dollars per share) | $ / shares | $ 0.003 |
Equity Plans and Share-Based 92
Equity Plans and Share-Based Compensation (Narrative) (Details) - USD ($) | 12 Months Ended | ||||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Jul. 01, 2008 | Dec. 31, 2005 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Option plan term | 10 years | ||||
Option plan term for options granted to an optionee owning more than 10% | 5 years | ||||
Optionee owner percentage | 10.00% | ||||
Exercise price to fair market value percentage | 110.00% | ||||
Non-statutory option granted exercise price to fair market value percentage | 85.00% | ||||
Share-based compensation cost | $ 123,268 | $ 888,348 | |||
Granted (in dollars per share) | $ 0 | ||||
Restricted Stock Units and Awards [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based compensation cost | $ 26,329 | $ 510,695 | |||
Number of shares available for grant (in shares) | 496,000 | ||||
Granted (in dollars per share) | $ 0 | $ 1.97 | |||
Stock Options [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based compensation cost | $ 96,939 | $ 377,653 | |||
Granted (in dollars per share) | $ 1.35 | ||||
Total compensation cost not yet recognized | $ 36,000 | ||||
Recognized over a weighted average period | 1 year 2 months 15 days | ||||
Vested and expected to vest shares (in shares) | 66,967 | ||||
Vested and expected to vest weighted average exercise price (in dollars per share) | $ 30.71 | ||||
Number of shares available for grant (in shares) | 189,475 | ||||
Stock Option Plan 2005 [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares authorized (in shares) | 270,000 | 170,000 | |||
Restricted Stock Plan 2008 [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares authorized (in shares) | 750,000 | 125,000 | 75,000 |
Equity Plans and Share-Based 93
Equity Plans and Share-Based Compensation (Share-based compensation cost by line item) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total share-based compensation cost | $ 123,268 | $ 888,348 |
Research and development [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total share-based compensation cost | 18,231 | 181,985 |
Selling, general, administrative [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total share-based compensation cost | $ 105,037 | $ 706,363 |
Equity Plans and Share-Based 94
Equity Plans and Share-Based Compensation (Share-based compensation cost by award type) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based compensation cost | $ 123,268 | $ 888,348 |
Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based compensation cost | 96,939 | 377,653 |
Restricted Stock Units and Awards [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based compensation cost | $ 26,329 | $ 510,695 |
Equity Plans and Share-Based 95
Equity Plans and Share-Based Compensation (Share-based compensation fair value assumptions) (Details) - Stock Options [Member] | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected volatility | 0.00% | 114.60% |
Risk free interest rate | 0.00% | 1.50% |
Expected dividends | 0.00% | 0.00% |
Expected life (in years) | 0 years | 5 years 10 months |
Equity Plans and Share-Based 96
Equity Plans and Share-Based Compensation (Schedule of stock option activity) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Stock Option Shares | |||
Outstanding, beginning balance (in shares) | 76,914 | 73,870 | |
Granted (in shares) | 0 | 33,250 | |
Exercised (in shares) | 0 | 0 | |
Canceled (in shares) | (6,283) | (30,206) | |
Outstanding, ending balance (in shares) | 70,631 | 76,914 | 73,870 |
Exercisable, ending balance (in shares) | 52,364 | ||
Stock Options Weighted Average Exercise Price | |||
Outstanding, beginning balance (in dollars per share) | $ 37.67 | $ 56.43 | |
Granted (in dollars per share) | 0 | ||
Exercised (in dollars per share) | 0 | 0 | |
Canceled (in dollars per share) | 31.23 | 41.15 | |
Outstanding, ending balance (in dollars per share) | 29.61 | $ 37.67 | $ 56.43 |
Exercisable, ending balance (in dollars per share) | $ 37.75 | ||
Stock Option, Additional Disclosures | |||
Outstanding, Weighted Average Remaining Contractual Life | 7 years 3 months 25 days | 8 years 3 months 11 days | 8 years 10 months 2 days |
Granted, Aggregate Intrinsic Value | $ 0 | $ 1,540 |
Equity Plans and Share-Based 97
Equity Plans and Share-Based Compensation (Schedule of restricted stock activity) (Details) - Restricted Stock Units and Awards [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Shares | ||
Non-vested, beginning balance (in shares) | 60,590 | 20,487 |
Granted (in shares) | 0 | 245,414 |
Vested (in shares) | (59,390) | (176,693) |
Forfeited (in shares) | (1,200) | (28,618) |
Non-vested, ending balance (in shares) | 0 | 60,590 |
Weighted Average Grant Date Fair Value | ||
Non-vested, beginning balance (in dollars per share) | $ 1.84 | $ 5.59 |
Granted (in dollars per share) | 0 | 1.97 |
Non-vested, ending balance (in dollars per share) | $ 0 | $ 1.84 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | Aug. 10, 2017 | Jan. 19, 2017 | Dec. 06, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Aug. 29, 2016 |
Related Party Transaction [Line Items] | ||||||
Ownership of outstanding stock, percentage | 3.00% | |||||
Private placement [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Ownership of outstanding stock, percentage | 9.99% | |||||
Discount notes [Member] | Tertius Financial Group Pte. Ltd. [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Proceeds from issuance of stock | $ 330,000 | |||||
Proceeds from promissory note | $ 200,000 | |||||
Debt, principal | $ 602,000 | |||||
Debt instrument, unamortized discount (premium), net | $ 60,000 | |||||
Discount notes [Member] | Private placement [Member] | Tertius Financial Group Pte. Ltd. [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Proceeds from issuance of stock | $ 330,000 | |||||
Common stock [Member] | Tertius Financial Group Pte. Ltd. [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Issuance of stock (in shares) | 333,333,333 | |||||
Promissory note, accrued interest, current, retired for shares | $ 4,340 | |||||
Common stock [Member] | Discount notes [Member] | Tertius Financial Group Pte. Ltd. [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Stated interest rate | 6.00% | 6.00% | ||||
Promissory note, current, retired for shares | $ 600,000 | |||||
Private Investor [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Ownership percentage | 3.00% | |||||
Private Investor [Member] | Chief Executive Officer [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Ownership percentage | 50.00% |
Income Taxes (Deferred Tax Asse
Income Taxes (Deferred Tax Assets) (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Current: | ||
Accrued Expenses | $ 0 | $ 192 |
Inventory Allowance | 141 | 234 |
Other | 13 | 43 |
Total Current | 154 | 469 |
Non-current: | ||
Stock Based Compensation-Stock Options and Restricted Stock | 1,058 | 1,919 |
Tax effect of NOL carryforward | 67,852 | 79,384 |
Depreciation | 8,748 | 17,406 |
Amortization | (368) | (637) |
Warranty reserve | 14 | 68 |
Total Non-current | 77,304 | 98,140 |
Net deferred tax asset | 77,458 | 98,609 |
Less valuation allowance | (77,458) | (98,609) |
Net deferred tax asset | $ 0 | $ 0 |
Income Taxes (Tax Rate Reconcil
Income Taxes (Tax Rate Reconciliation) (Details) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | ||
Federal statutory rate | 35.00% | 35.00% |
State statutory rate | 2.80% | 2.60% |
Change in rate | 0.00% | (0.40%) |
Permanent tax differences | (2.30%) | (0.10%) |
Change in fair value of derivatives | 8.40% | 0.90% |
Deemed interest expense on debt discount | (5.50%) | (5.10%) |
Loss on extinguishment of liabilities | (4.90%) | (5.90%) |
Other | (0.90%) | (1.80%) |
Increase in valuation allowance | (32.60%) | (25.60%) |
Effective tax rate | 0.00% | 0.00% |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | ||
Net operating loss carryforwards | $ 321,066,413 | |
Operating loss carryforwards, limitations on use | 234,024,680 | |
Increase (decrease) in valuation allowance | (21,151,000) | |
Valuation allowance | $ 77,458,000 | $ 98,609,000 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) | Apr. 16, 2014 | Oct. 21, 2011 | Dec. 31, 2010 | Dec. 31, 2017 | Dec. 31, 2013 |
Commitments and Contingencies Disclosure [Abstract] | |||||
Complaint claim amount | $ 3,000,000 | ||||
Attorney's fees and prejudgment interest | $ 1,200,000 | ||||
Litigation settlement, amount awarded to other party | $ 2,000,000 | $ 2,000,000 | |||
Litigation settlement, payment period | 40 months | ||||
Payments for legal settlements | $ 339,481 | ||||
Litigation accrual | $ 1,700,000 |
Retirement Plan (Details)
Retirement Plan (Details) - USD ($) | Jul. 01, 2006 | Dec. 31, 2017 | Dec. 31, 2016 |
Defined Contribution Plan [Line Items] | |||
Employee minimum age | 21 years | ||
Percent of employer contribution | 100.00% | ||
Percent of employee contribution that employer will match | 6.00% | ||
Employer discretionary contribution amount | $ 199,669 | $ 338,230 | |
Employees Hired Before January 1, 2010 [Member] | |||
Defined Contribution Plan [Line Items] | |||
Annual vesting percentage | 100.00% | ||
Employees Hired After January 1, 2010 [Member] | |||
Defined Contribution Plan [Line Items] | |||
Annual vesting percentage | 33.33% | ||
Vesting period | 3 years |
Subsequent Events (Narrative) (
Subsequent Events (Narrative) (Details) | Mar. 26, 2018USD ($)shares | Mar. 12, 2018USD ($)shares | Feb. 16, 2018USD ($) | Dec. 31, 2017USD ($)shares | Feb. 28, 2018shares | Mar. 26, 2018USD ($)paymentshares | Dec. 31, 2017USD ($)shares | Dec. 31, 2016USD ($) | Mar. 28, 2018USD ($) | Mar. 21, 2018USD ($) | Jan. 31, 2018USD ($) | Dec. 06, 2017USD ($) | Sep. 11, 2017USD ($) | Sep. 08, 2017USD ($)shares |
Subsequent Event [Line Items] | ||||||||||||||
Convertible debt, redeemed | $ 55,067 | $ 0 | ||||||||||||
Note Secured Promissory Agreement [Member] | Subsequent Event [Member] | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Issuance of common stock | $ 1,250,000 | |||||||||||||
Issuance of stock (in shares) | shares | 2,450,980,392 | |||||||||||||
Unsecured debt [Member] | Promissory Note Five [Member] | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Proceeds from promissory note | $ 177,500 | |||||||||||||
Unsecured debt [Member] | Promissory Note Five [Member] | Subsequent Event [Member] | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Aggregate principal amount of notes outstanding | $ 200,000 | $ 200,000 | ||||||||||||
Debt, principal | 177,500 | |||||||||||||
Debt instrument, unamortized discount (premium), net | $ 22,500 | |||||||||||||
Stated interest rate | 12.00% | |||||||||||||
Unsecured debt [Member] | Promissory Note Six [Member] | Subsequent Event [Member] | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Proceeds from promissory note | $ 30,000 | |||||||||||||
Secured Debt [Member] | Note Secured Promissory Agreement [Member] | Subsequent Event [Member] | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Number Of Payments | payment | 5 | |||||||||||||
Stock Issued During Period, Value, New Issues Per Payment | $ 250,000 | |||||||||||||
Aggregate principal amount of notes outstanding | 4,665,675 | $ 1,500,000 | ||||||||||||
Secured Debt [Member] | Note Secured Promissory Agreement, Maturing March 21, 2019 [Member] | Subsequent Event [Member] | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Aggregate principal amount of notes outstanding | $ 250,000 | |||||||||||||
Convertible Debt [Member] | 2017 St. George Convertible Note [Member] | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Aggregate principal amount of notes outstanding | $ 1,705,833 | 1,705,833 | $ 1,725,000 | $ 1,725,000 | ||||||||||
Stated interest rate | 22.00% | |||||||||||||
Increase in shares reserved for future issuance (in shares) | shares | 3,000,000,000 | |||||||||||||
Shares of stock reserved for future issuance (in shares) | shares | 1,880,000,000 | |||||||||||||
Convertible Debt [Member] | 2017 St. George Convertible Note [Member] | Subsequent Event [Member] | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Aggregate principal amount of notes outstanding | 1,630,833 | |||||||||||||
Increase in shares reserved for future issuance (in shares) | shares | 2,000,000,000 | |||||||||||||
Shares of stock reserved for future issuance (in shares) | shares | 6,690,000,000 | 6,880,000,000 | ||||||||||||
Convertible debt, redeemed | $ 75,000 | |||||||||||||
Debt conversion, converted instrument, shares issued (in shares) | shares | 187,500,000 | |||||||||||||
Convertible Debt [Member] | Baybridge Convertible Note [Member] | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Aggregate principal amount of notes outstanding | $ 565,000 | $ 565,000 | $ 840,000 | |||||||||||
Stated interest rate | 12.00% | |||||||||||||
Debt conversion, converted instrument, shares issued (in shares) | shares | 404,411,765 | |||||||||||||
Convertible Debt [Member] | Baybridge Convertible Note [Member] | Subsequent Event [Member] | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Aggregate principal amount of notes outstanding | $ 460,000 | |||||||||||||
Convertible debt, redeemed | $ 105,000 | |||||||||||||
Debt conversion, converted instrument, shares issued (in shares) | shares | 493,006,549 | |||||||||||||
Debt conversion, converted instrument, interest converted | $ 20,717 |
Subsequent Events (Summary of t
Subsequent Events (Summary of the Securities Purchase Agreement Funding) (Details) - Subsequent Event [Member] - Secured Debt [Member] | Mar. 21, 2018USD ($) |
Note Secured Promissory Agreement, Maturing January 11, 2019 [Member] | |
Subsequent Event [Line Items] | |
Aggregate principal amount of notes outstanding | $ 250,000 |
Note Secured Promissory Agreement, Maturing January 25, 2019 [Member] | |
Subsequent Event [Line Items] | |
Aggregate principal amount of notes outstanding | 250,000 |
Note Secured Promissory Agreement, Maturing February 8, 2019 [Member] | |
Subsequent Event [Line Items] | |
Aggregate principal amount of notes outstanding | 250,000 |
Note Secured Promissory Agreement, Maturing February 22, 2019 [Member] | |
Subsequent Event [Line Items] | |
Aggregate principal amount of notes outstanding | 250,000 |
Note Secured Promissory Agreement, Maturing March 7, 2019 [Member] | |
Subsequent Event [Line Items] | |
Aggregate principal amount of notes outstanding | 250,000 |
Note Secured Promissory Agreement, Maturing March 21, 2019 [Member] | |
Subsequent Event [Line Items] | |
Aggregate principal amount of notes outstanding | $ 250,000 |