Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Jun. 30, 2016 | Aug. 31, 2016 | Dec. 31, 2015 | |
Document And Entity Information | |||
Entity Registrant Name | Cellceutix CORP | ||
Entity Central Index Key | 1,355,250 | ||
Trading Symbol | ctix | ||
Current Fiscal Year End Date | --06-30 | ||
Entity Filer Category | Accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | Jun. 30, 2016 | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Well-known Seasoned Issuer | No | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Entity Public Float | $ 123,251,018 | ||
Entity Common Stock, Shares Outstanding | 124,608,756 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Jun. 30, 2016 | Jun. 30, 2015 |
Current Assets: | ||
Cash | $ 6,310,000 | $ 8,410,000 |
Prepaid expenses and security deposits | 350,000 | 347,000 |
Subscription receivable | 26,000 | 12,000 |
Total Current Assets | 6,686,000 | 8,769,000 |
Other Assets: | ||
Patent costs - net | 4,311,000 | 5,018,000 |
Property, plant and equipment -net | 90,000 | 38,000 |
Deferred offering costs | 358,000 | 494,000 |
Total Other Assets | 4,759,000 | 5,550,000 |
Total Assets | 11,445,000 | 14,319,000 |
Current Liabilities: | ||
Accounts payable - (including related party payables of approx. $1,502,000 and $1,686,000, respectively) | 3,528,000 | 1,838,000 |
Accrued expenses - (including related party accruals of approx. $72,000 and $115,000, respectively) | 97,000 | 593,000 |
Accrued salaries and payroll taxes -(including related party accrued salaries of approx. $2,777,000 and $2,777,000, respectively) | 2,834,000 | 2,842,000 |
Note payable - related party | 2,022,000 | 2,022,000 |
Total Current Liabilities | 8,481,000 | 7,295,000 |
Total Liabilities | 8,481,000 | 7,295,000 |
Stockholders' Equity | ||
Preferred stock, $0.001 par value, 500,000 designated shares, no shares issued and outstanding | ||
Additional paid-in capital | 56,969,000 | 48,177,000 |
Accumulated deficit | (54,017,000) | (41,165,000) |
Total Stockholders' Equity | 2,964,000 | 7,024,000 |
Total Liabilities and Stockholders' Equity | 11,445,000 | 14,319,000 |
Common Class A | ||
Stockholders' Equity | ||
Common Stock, Value | 12,000 | 12,000 |
Common Class B | ||
Stockholders' Equity | ||
Common Stock, Value |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Jun. 30, 2016 | Jun. 30, 2015 |
Current Liabilities: | ||
Accounts payable, related party payables (in dollars) | $ 1,502,000 | $ 1,686,000 |
Accrued expenses, related party accruals (in dollars) | 72,000 | 115,000 |
Accrued salaries, due to related parties (in dollars) | $ 2,777,000 | $ 2,777,000 |
Stockholders' Equity | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares designated (in shares) | 500,000 | 500,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common Class A | ||
Stockholders' Equity | ||
Common Stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common Stock, shares authorized (in shares) | 300,000,000 | 300,000,000 |
Common Stock, shares issued (in shares) | 123,589,536 | 117,763,508 |
Common Stock, shares outstanding (in shares) | 123,589,536 | 117,763,508 |
Common Class B | ||
Stockholders' Equity | ||
Common Stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common Stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common Stock, shares issued (in shares) | 0 | 0 |
Common Stock, shares outstanding (in shares) | 0 | 0 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Consolidated Statements Of Operations | |||
Revenues | |||
Operating expenses: | |||
Research and development expenses | 8,952,000 | 10,531,000 | 6,344,000 |
General and administrative expenses | 1,946,000 | 1,177,000 | 872,000 |
Officers' payroll and payroll tax expenses | 528,000 | 801,000 | 505,000 |
Professional fees | 1,228,000 | 447,000 | 317,000 |
Total operating expenses | 12,654,000 | 12,956,000 | 8,038,000 |
Loss from operations | (12,654,000) | (12,956,000) | (8,038,000) |
Other expenses | |||
Interest income | 4,000 | 4,000 | 1,000 |
Sundry income | 9,000 | ||
Interest expense | (202,000) | (202,000) | (210,000) |
Total other expenses, net | (198,000) | (189,000) | (209,000) |
Loss before provision for income taxes | (12,852,000) | (13,145,000) | (8,247,000) |
Provision for income taxes | |||
Net loss | (12,852,000) | (13,145,000) | (8,247,000) |
Deemed dividends | (1,980,000) | ||
Net loss attributable to common stockholders | $ (12,852,000) | $ (13,145,000) | $ (10,227,000) |
Basic and diluted loss per share attributable to common stockholders | $ (0.11) | $ (0.11) | $ (0.10) |
Weighted average number of common shares | 119,908,145 | 115,087,368 | 105,044,985 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) | Preferred Stock | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Treasury Stock | Total |
Beginning Balance, Shares at Jun. 30, 2013 | 100,456,068 | 1,382,084 | ||||
Beginning Balance, Amount at Jun. 30, 2013 | $ 10,046 | $ 14,868,000 | $ (19,773,000) | $ (275,000) | $ (5,171,000) | |
Shares issued for assets of Polymedix at $1.93, net of $1.4 million Redeemable Common Stock liability, Shares | 1,400,000 | |||||
Shares issued for assets of Polymedix at $1.93, net of $1.4 million Redeemable Common Stock liability, Amount | $ 140 | 1,302,000 | 1,302,000 | |||
Issuance of stock options | 109,000 | 109,000 | ||||
Exercise of warrants, Shares | 3,148,084 | |||||
Exercise of warrants, Amount | $ 315 | 2,700,000 | 2,700,000 | |||
Shares sold to Aspire under December 2012 Agreement at $1.66-$1.94, Shares | 3,204,537 | |||||
Shares sold to Aspire under December 2012 Agreement at $1.66-$1.94, Amount | $ 320 | 5,617,000 | 5,618,000 | |||
Shares issued to employees for year ended bonus at $1.85 for 5,000 shares and $1.6 for 60,000 shares, Shares | 65,000 | |||||
Shares issued to employees for year ended bonus at $1.85 for 5,000 shares and $1.6 for 60,000 shares, Amount | $ 7 | 105,000 | 105,000 | |||
Shares sold to Aspire under October 2013 Agreement at $1.64-1.82, Shares | 2,500,000 | |||||
Shares sold to Aspire under October 2013 Agreement at $1.64-1.82, Amount | $ 250 | 4,154,000 | 4,155,000 | |||
Shares issued for offering cost at $1.77, Shares | 210,523 | |||||
Shares issued for offering cost at $1.77, Amount | $ 21 | 373,000 | 373,000 | |||
Offering cost | (77,000) | (77,000) | ||||
Shares issued to consultants at $1.64-$2.09, Shares | 160,000 | |||||
Shares issued to consultants at $1.64-$2.09, Amount | $ 16 | 305,000 | 305,000 | |||
Exercise of options, Shares | 25,000 | |||||
Exercise of options, Amount | $ 2 | 5,000 | 5,000 | |||
Issuance of stock warrants | 29,000 | 29,000 | ||||
Cancellation of treasury stock, Shares | (1,382,083) | (1,382,084) | ||||
Cancellation of treasury stock, Amount | $ (138) | (275,000) | $ 275,000 | |||
Deemed dividends of $1,979,706 | ||||||
Net loss | (8,247,000) | (8,247,000) | ||||
Ending Balance, Shares at Jun. 30, 2014 | 109,787,129 | |||||
Ending Balance, Amount at Jun. 30, 2014 | $ 10,979 | 29,215,000 | (28,020,000) | 1,206,000 | ||
Exercise of warrants, Shares | 941,000 | |||||
Exercise of warrants, Amount | $ 94 | 756,000 | 756,000 | |||
Offering cost | (299,000) | (299,000) | ||||
Exercise of options, Shares | 320,000 | |||||
Exercise of options, Amount | $ 32 | 111,000 | 111,000 | |||
Shares sold to Aspire under Oct 2014 Agreement at $1.62-$4.21, Shares | 6,390,379 | |||||
Shares sold to Aspire under Oct 2014 Agreement at $1.62-$4.21, Amount | $ 639 | 15,845,000 | 15,846,000 | |||
Shares sold to Aspire under March 2015 Agreement at $2.95, net of financing cost $44,000, Shares | 100,000 | |||||
Shares sold to Aspire under March 2015 Agreement at $2.95, net of financing cost $44,000, Amount | $ 10 | 251,000 | 251,000 | |||
Expiration from Redeemable Common Stock liability | 1,400,000 | 1,400,000 | ||||
Shares issued to officer for bonus at $2.93, Shares | 50,000 | |||||
Shares issued to officer for bonus at $2.93, Amount | $ 5 | 146,000 | 146,000 | |||
Stock options issued to employees for bonus at $2.93-$4.71 | 198,000 | 198,000 | ||||
Shares issued to consultant for services at $2.56, Shares | 15,000 | |||||
Shares issued to consultant for services at $2.56, Amount | $ 2 | 38,000 | 38,000 | |||
Stock options issued to consultant for services | 17,000 | 17,000 | ||||
Shares issued as commitment fee, 3/30/2015 at $3.12, Shares | 160,000 | |||||
Shares issued as commitment fee, 3/30/2015 at $3.12, Amount | $ 16 | 499,000 | 499,000 | |||
Net loss | (13,145,000) | (13,145,000) | ||||
Ending Balance, Shares at Jun. 30, 2015 | 117,763,508 | |||||
Ending Balance, Amount at Jun. 30, 2015 | $ 11,777 | 48,177,000 | (41,165,000) | 7,024,000 | ||
Offering cost | (135,000) | (135,000) | ||||
Exercise of options, Shares | 74,000 | |||||
Exercise of options, Amount | $ 7 | 40,000 | 40,000 | |||
Shares sold to Aspire under April 2015 Agreement at $1.01-$2.53 range Shares | 5,700,000 | |||||
Shares sold to Aspire under April 2015 Agreement at $1.01-$2.53 range Amount | $ 440 | 8,174,000 | 8,174,000 | |||
Shares issued to consultants for services at $1.12-$2.49, Shares | 52,028 | |||||
Shares issued to consultants for services at $1.12-$2.49, Amount | $ 4 | 86,000 | 86,000 | |||
Shares issued to officer as equity awards at $1.40 | 8,000 | 8,000 | ||||
Stock option issued to consultant for services | 555,000 | 555,000 | ||||
Stock option issued to directors as compensation at $1.58 | 60,000 | 60,000 | ||||
Stock option issued to officer as equity awards at $1.39 | 4,000 | 4,000 | ||||
Net loss | (12,852,000) | (12,852,000) | ||||
Ending Balance, Shares at Jun. 30, 2016 | 123,589,536 | |||||
Ending Balance, Amount at Jun. 30, 2016 | $ 12,228 | $ 56,969,000 | $ (54,017,000) | $ 2,964,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOW - USD ($) | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net loss | $ (12,852,000) | $ (13,145,000) | $ (8,247,000) |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Loss on disposal of fixed assets | 73,000 | ||
Common stock and stock options issued aspayment for services compensation, services rendered and financing costs | 713,000 | 400,000 | 548,000 |
Amortization of patent costs | 404,000 | 394,000 | 285,000 |
Impairment of patent costs | 648,000 | ||
Depreciation of equipment | 16,000 | 10,000 | 4,000 |
Changes in operating assets and liabilities: | |||
Prepaid expenses and security deposits | (3,000) | 221,000 | (563,000) |
Accounts payable | 1,690,000 | (826,000) | 815,000 |
Accrued expenses | (495,000) | 257,000 | (218,000) |
Accrued officers' salaries and payroll taxes | (9,000) | (382,000) | (207,000) |
Net cash used in operating activities | (9,887,000) | (13,071,000) | (7,510,000) |
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Proceeds from disposal of fixed assets | 24,000 | ||
Additions to property, plant and equipment | (68,000) | (9,000) | (43,000) |
Patent costs | (346,000) | (450,000) | (2,631,000) |
Net cash used in investing activities | (414,000) | (459,000) | (2,650,000) |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Sale of common stock, net of offering costs | 8,173,000 | 16,097,000 | 9,772,000 |
Payment of settlement liabilities | (284,000) | ||
Exercise of stock options and warrants | 28,000 | 855,000 | 2,705,000 |
Net cash provided by financing activities | 8,201,000 | 16,952,000 | 12,193,000 |
NET (DECREASE) INCREASE IN CASH | (2,100,000) | 3,422,000 | 2,033,000 |
CASH - BEGINNING OF YEAR | 8,410,000 | 4,988,000 | 2,955,000 |
CASH - END OF YEAR | 6,310,000 | 8,410,000 | 4,988,000 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | |||
Cash paid for interest | 235,000 | 366,000 | 259,000 |
SUPPLEMENTAL DISCLOSURE OF NON-CASH FLOW INVESTING AND FINANCING ACTIVITIES | |||
Cancellation of treasury stock | (275,000) | ||
Deemed dividend - warrants | 1,980,000 | ||
Shares issued as deferred offering costs | 499,000 | 373,000 | |
Shares issued for acquisition of patent and equipment | 2,702,000 | ||
Redeemable common stock | $ (1,400,000) | $ 1,400,000 |
Basis of Presentation and Natur
Basis of Presentation and Nature of Operations | 12 Months Ended |
Jun. 30, 2016 | |
Notes to Financial Statements | |
Note 1 - Basis of Presentation and Nature of Operations | Basis of Presentation Cellceutix Corporation (“Cellceutix” or the “Company”) was incorporated as Econoshare, Inc. on August 1, 2005, in the State of Nevada. On December 6, 2007, the Company acquired Cellceutix Pharma, Inc., a privately owned corporation formed under the laws of the State of Delaware on June 20, 2007. Following the acquisition, the Company changed its name to Cellceutix Corporation. Cellceutix Corporation has no subsidiary since Cellceutix Pharma, Inc. was dissolved in 2014. The Company is a clinical stage biopharmaceutical company and has no customers, products or revenues to date. The Company’s Common Stock is quoted on OTCQB, symbol “CTIX”. Nature of Operations -Overview We are in the business of developing innovative small molecule therapies to treat diseases with significant medical need, particularly in the areas of cancer, antibiotics and inflammatory disease. Our strategy is to use our business and scientific expertise to maximize the value of our pipeline. We will do this by focusing initially on our lead compounds, Brilacidin, Kevetrin and Prurisol and advancing them as quickly as possible along the regulatory pathway. We will develop the highest quality data and broadest intellectual property to support our compounds. We currently own all development and marketing rights to our products. In order to successfully develop and market our products, we may have to partner with other companies. Prospective partners may require that we grant them significant development and/or commercialization rights in return for agreeing to share the risk of development and/or commercialization. |
Liquidity
Liquidity | 12 Months Ended |
Jun. 30, 2016 | |
Notes to Financial Statements | |
Note 2 - Liquidity | At June 30, 2016, we had approximately $6.3 million in cash and cash equivalents. We have expended substantial funds on the research and development of our product candidates. Our net losses incurred during the three fiscal years ended June 30, 2016, 2015 and 2014, amounted to approximately $12.9 million, $13.2 million and $8.2 million, respectively, and a working capital (deficit) of approximately $(1.8) million and working capital of $1.5 million, respectively at June 30, 2016 and June 30, 2015. On March 30, 2015, the Company entered into a common stock purchase agreement with Aspire Capital Fund, LLC, an Illinois limited liability company ("Aspire Capital") which provides that, upon the terms and subject to the conditions and limitations set forth therein, Aspire Capital is committed to purchase up to an aggregate of $30.0 million of the Company's common stock over the 36-month term of the Purchase Agreement. As of June 30, 2016, the available balance is approximately $22 million. The Company plans to incur expenses of approximately $19 million over the next twelve months, including approximately $15 million for clinical trials. The Company has limited experience with pharmaceutical drug development. As such, the budget estimate may not be accurate. In addition, the actual work to be performed is not known at this time, other than a broad outline, as is normal with any scientific work. As further work is performed, additional work may become necessary or change in plans or workload may occur. Such changes may have an adverse impact on our estimated budget and on our projected timeline of drug development. Management believes that the amounts available from Aspire and under the CompanyÂ’s effective shelf registration statement will be sufficient to fund the CompanyÂ’s operations for the next 12 months. If we are unable to generate enough working capital from our current financing agreement with Aspire Capital when needed or secure additional sources of funding, it may be necessary to significantly reduce our current rate of spending through reductions in staff and delaying, scaling back or stopping certain research and development programs, including more costly Phase 2 and Phase 3 clinical trials on our wholly-owned development programs as these programs progress into later stage development. Insufficient liquidity may also require us to relinquish greater rights to product candidates at an earlier stage of development or on less favorable terms to us and our stockholders than we would otherwise choose in order to obtain up-front license fees needed to fund operations. These events could prevent us from successfully executing our operating plan. |
Significant Accounting Policies
Significant Accounting Policies and Recent Accounting Pronouncements | 12 Months Ended |
Jun. 30, 2016 | |
Notes to Financial Statements | |
Note 3 - Significant Accounting Policies and Recent Accounting Pronouncements | Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting periods. Significant items subject to such estimates and assumptions include contract research accruals, recoverability of long-lived assets, measurement of stock-based compensation, and the periods of performance under collaborative research and development agreements. The Company bases its estimates on historical experience and various other assumptions that management believes to be reasonable under the circumstances. Changes in estimates are recorded in the period in which they become known. Actual results could differ from those estimates. Cash and Cash Equivalents Cash and cash equivalents consist of cash and short-term highly liquid investments purchased with original maturities of three months or less. There were no cash equivalents at June 30, 2016 and 2015. Property, Plant and Equipment Property and equipment are stated at cost, net of accumulated depreciation. Expenditures that extend the life, increase the capacity, or improve the efficiency of property and equipment are capitalized, while expenditures for repairs and maintenance are expensed as incurred. Depreciation is recognized using the straight-line method over the following approximate useful lives: Machinery and equipment 5 Years Intangible Assets – Patents Costs incurred to file patent applications and acquired intangibles are capitalized when the Company believes that there is a high likelihood that the patent will be issued and there will be future economic benefit associated with the patent. These costs will be amortized on a straight-line basis over a 12 - 17 years life from the date of patent filing. All costs associated with abandoned patent applications are expensed. In addition, the Company will review the carrying value of patents for indicators of impairment on a periodic basis and if it determines that the carrying value is impaired, it values the patent at fair value. As of June 30, 2016 and 2015, carrying value of patent was approximately $4,311,000 and $5,018,000, respectively. Amortization expense for the fiscal years ended June 30, 2016, 2015 and 2014, was approximately $404,000, $394,000 and $285,000, respectively. As of June 30, 2016, the Company expensed the costs associated with obtaining patents that have not yet developed products nor which have gained market acceptance and the Company has or will let these patents go abandoned. For the fiscal years ended June 30, 2016, 2015 and 2014, the Company has charged to operations approximately $37,000, $102,000, and $136,000, respectively as patent expenses included in general and administrative expenses. In accordance with the provisions of the applicable authoritative guidance, the Company’s long-lived assets and amortizable intangible assets are tested for impairment whenever events or changes in circumstances indicate that their carrying value may not be recoverable. The Company assesses the recoverability of such assets by determining whether their carrying value can be recovered through undiscounted future operating cash flows, including its estimates of revenue driven by assumed market segment share and estimated costs. If impairment is indicated, the Company measures the amount of such impairment by comparing the fair value to the carrying value. During the fiscal years ended June 30, 2016, 2015 and 2014, the Company has recorded impairment on patent costs of Delparantag and various patents approximately $648,000, $0, and $0, respectively and included in general and administrative expenses. Financial Instruments The Company’s financial instruments include cash, accounts payable and accrued liabilities. The carrying amounts of these financial instruments approximate their fair value, due to the short-term nature of these items. The fair value hierarchy has the following three levels: Level 1—quoted prices in active markets for identical assets and liabilities. Level 2—observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. Level 3—unobservable inputs that reflect the Company's own assumptions about the assumptions market participants would use in pricing the asset or liability. Certain Risks and Uncertainties Product Development We devote significant resources to research and development programs in an effort to discover and develop potential future product candidates. The product candidates in our pipeline are at various stages of preclinical and clinical development. The path to regulatory approval includes three phases of clinical trials in which we collect data to support an application to regulatory authorities to allow us to market a product for treatment of a specified disease. There are many difficulties and uncertainties inherent in research and development of new products, resulting in a high rate of failure. To bring a drug from the discovery phase to regulatory approval, and ultimately to market, takes many years and significant cost. Failure can occur at any point in the process, including after the product is approved, based on post-market factors. New product candidates that appear promising in development may fail to reach the market or may have only limited commercial success because of efficacy or safety concerns, inability to obtain necessary regulatory approvals, limited scope of approved uses, reimbursement challenges, difficulty or excessive costs of manufacture, alternative therapies or infringement of the patents or intellectual property rights of others. Uncertainties in the FDA approval process and the approval processes in other countries can result in delays in product launches and lost market opportunities. Consequently, it is very difficult to predict which products will ultimately be submitted for approval, which have the highest likelihood of obtaining approval and which will be commercially viable and generate profits. Successful results in preclinical or clinical studies may not be an accurate predictor of the ultimate safety or effectiveness of a drug or product candidate. Expenditures for research, development, and engineering of products are expensed as incurred. For the fiscal years ended June 30, 2016, 2015 and 2014, the Company incurred approximately $8,952,000, $10,531,000 and $6,344,000 of research and development costs, respectively. Concentrations of Credit Risk The Company maintains its cash in bank deposit and checking accounts that at times exceed federally insured limits. Approximately $6 million is subject to credit risk at June 30, 2016. However, these cash balances are maintained at creditworthy financial institutions. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk. Accrued Outsourcing Costs Substantial portions of our preclinical studies and clinical trials are performed by third-party laboratories, medical centers, contract research organizations and other vendors, or collectively "CROs". These CROs generally bill monthly or quarterly for services performed, or bill based upon milestone achievement. For preclinical studies, we accrue expenses based upon estimated percentage of work completed and the contract milestones remaining. For clinical studies, expenses are accrued based upon the number of patients enrolled and the duration of the study. We monitor patient enrollment, the progress of clinical studies and related activities to the extent possible through internal reviews of data reported to us by the CROs, correspondence with the CROs and clinical site visits. Our estimates depend on the timeliness and accuracy of the data provided by the CROs regarding the status of each program and total program spending. We periodically evaluate the estimates to determine if adjustments are necessary or appropriate based on information we receive. Valuation of Equity Grants The Company accounts for all share-based payments to employees, including grants of employee stock options, to be recognized in the consolidated financial statements based on their fair values. The Company is required to measure the cost of employee services received in exchange for stock options and similar awards based on the grant-date fair value of the award and recognize this cost in the income statement over the period during which an employee is required to provide service in exchange for the award. The Company uses the Black-Scholes valuation model and has elected to use the ratable method to amortize compensation expense over the vesting period of the grant. The Company accounts for equity instruments issued to nonemployees by valuing them using the Black-Scholes valuation model. The measurement of stock-based compensation is subject to periodic adjustments as the underlying equity instruments vest. Income Taxes Deferred income tax assets and liabilities arise from temporary differences associated with differences between the consolidated financial statements and tax basis of assets and liabilities, as measured by the enacted tax rates, which are expected to be in effect when these differences reverse. Deferred tax assets and liabilities are classified as current or non-current, depending upon the classification of the asset or liabilities to which they relate. Deferred tax assets and liabilities not related to an asset or liability are classified as current or non-current depending on the periods in which the temporary differences are expected to reverse. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. The Company has generated net losses since inception and accordingly has not recorded a provision for income taxes. The deferred tax assets were primarily comprised of federal and state tax net operating loss, or NOL, carryforwards. Due to uncertainties surrounding the Company’s ability to generate future taxable income to realize these tax assets, a full valuation allowance has been established to offset the deferred tax assets. Additionally, the future utilization of the NOL carryforwards to offset future taxable income may be subject to an annual limitation as a result of ownership changes that could occur in the future. If necessary, the deferred tax assets will be reduced by any carryforwards that expire prior to utilization as a result of such limitations, with a corresponding reduction of the valuation allowance. The Company follows the provisions of FASB ASC 740-10 “ Uncertainty in Income Taxes The Company has identified its U.S. Federal income tax return and its State return in Massachusetts as its major tax jurisdictions. The fiscal 2013 and forward years are still open for examination. Basic Earnings (Loss) per Share Basic and diluted earnings per share are computed based on the weighted-average common shares and common share equivalents outstanding during the period. Common share equivalents consist of stock options, warrants and convertible notes payable. Common share equivalents were excluded from the computation of diluted earnings per share for the years ended June 30, 2016, 2015 and 2014, because their effect is anti-dilutive (See note 12 Weighted Average Shares Outstanding). Accounting for Stock Based Compensation The stock-based compensation expense incurred by Cellceutix for employees and directors in connection with its stock option plan is based on the employee model of ASC 718, and the fair market value of the options is measured at the grant date. Under ASC 718 employee is defined as “An individual over whom the grantor of a share-based compensation award exercises or has the right to exercise sufficient control to establish an employer-employee relationship based on common law as illustrated in case law and currently under U.S. “tax regulations”. Our consultants do not meet the employer-employee relationship as defined by the IRS and therefore are accounted for under ASC 505-50. ASC 505-50-30-11 (previously EITF 96-18) further provides that an issuer shall measure the fair value of the equity instruments in these transactions using the stock price and other measurement assumptions as of the earlier of the following dates, referred to as the measurement date: i. The date at which a commitment for performance by the counterparty to earn the equity instruments is reached (a performance commitment); and ii. The date at which the counterparty’s performance is complete. We have elected to use the Black-Scholes-Merton pricing model to determine the fair value of stock options on the dates of grant. Restricted stock units are measured based on the fair market values of the underlying stock on the dates of grant. We recognize stock-based compensation using the straight-line method. The components of stock based compensation related to stock options in the Company’s Statement of Operations for the fiscal years ended June 30, 2016, 2015 and 2014 are as follows (rounded to nearest thousand): June 30, 2016 June 30, 2015 June 30, 2014 Research and development expenses Consulting fees $ 188,000 $ 55,000 $ 389,000 Employees’ bonus - 103,000 - Officers’ bonus 33,000 230,000 - Professional expenses 432,000 - - General and administrative expenses Directors’ fees 60,000 - - Employees’ bonus - 12,000 105,000 Consulting fees - - 54,000 Total share-based compensation expense $ 713,000 $ 400,000 $ 548,000 Recent Accounting Pronouncements Standards Issued Not Yet Adopted In August 2014, the FASB issued ASU 2014-15, “Presentation of Financial Statements—Going Concern—Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern” (“ASU 2014-15”). The ASU 2014-15 requires management to assess an entity’s ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. ASU 2014-15 is effective for annual periods, and interim periods within those annual periods, starting after December 15, 2016; the Company’s first quarter of fiscal 2018. Management is currently evaluating the impact of this standard on our consolidated financial statements. In May 2014, the FASB issued authoritative guidance that defines how companies should report revenues from contracts with customers. The standard requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. It provides companies with a single comprehensive five-step principles based model to use in accounting for revenue and supersedes current revenue recognition requirements, including most industry-specific and transaction-specific revenue guidance. In August 2015, the FASB deferred the effective date of the new revenue standard by one year. As a result, the new standard would not be effective for the Company until 2019. In addition, the FASB is allowing companies to early adopt this guidance for non-public entities beginning in fiscal year 2017. The guidance permits an entity to apply the standard retrospectively to all prior periods presented, with certain practical expedients, or apply the requirements in the year of adoption, through a cumulative adjustment. The Company will apply this new guidance when it becomes effective and has not yet selected a transition method. The Company is currently evaluating the impact of adoption on its consolidated financial statements. In June 2014, the FASB issued ASU 2014-12, Compensation - Stock Compensation. The amendments in this ASU apply to reporting entities that grant their employees share-based payments in which the terms of the award provide that a performance target can be achieved after the requisite service period. This ASU is the final version of Proposed ASU EITF-13D--Compensation--Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period, which has been deleted. The amendments require that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. A reporting entity should apply existing guidance in Topic 718 as it relates to awards with performance conditions that affect vesting to account for such awards. As such, the performance target should not be reflected in estimating the grant-date fair value of the award. Compensation cost should be recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable to the period(s) for which the requisite service has already been rendered. If the performance target becomes probable of being achieved before the end of the requisite service period, the remaining unrecognized compensation cost should be recognized prospectively over the remaining requisite service period. The total amount of compensation cost recognized during and after the requisite service period should reflect the number of awards that are expected to vest and should be adjusted to reflect those awards that ultimately vest. The requisite service period ends when the employee can cease rendering service and still be eligible to vest in the award if the performance target is achieved. As indicated in the definition of vest, the stated vesting period (which includes the period in which the performance target could be achieved) may differ from the requisite service period. The amendments in this ASU are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015, and early adoption is permitted. Management believes that the adoption of this guidance will not have a material impact on our consolidated financial statements. In June 2015, FASB issued ASU No. 2015-10, Technical Corrections and Updates. ASU No. 2015-10 is intended to correct differences between original guidance and the Codification, clarify the guidance, correct references and make minor improvements affecting a variety of topics. ASU No. 2015-10 covers a wide range of topics in the Codification and is generally categorized as follows: Amendments Related to Differences between Original Guidance and the Codification; Guidance Clarification and Reference Corrections; Simplification; and Minor Improvements. The amendments are effective for fiscal years and interim periods within those fiscal years, beginning after December 15, 2015. Early adoption is permitted. Management believes that the adoption of this guidance will not have a material impact on our consolidated financial statements. In February 2016, FASB issued ASU No. 2016-02, Leases (Topic 842). The guidance requires that a lessee recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right of use asset representing its right to use the underlying asset for the lease term. For finance leases: the right-of-use asset and a lease liability will be initially measured at the present value of the lease payments, in the statement of financial position; interest on the lease liability will be recognized separately from amortization of the right-of-use asset in the statement of comprehensive income; and repayments of the principal portion of the lease liability will be classified within financing activities and payments of interest on the lease liability and variable lease payments within operating activities in the statement of cash flows. For operating leases: the right-of-use asset and a lease liability will be initially measured at the present value of the lease payments, in the statement of financial position; a single lease cost will be recognized, calculated so that the cost of the lease is allocated over the lease term on a generally straight-line basis; and all cash payments will be classified within operating activities in the statement of cash flows. Under Topic 842 the accounting applied by a lessor is largely unchanged from that applied under previous GAAP. The amendments in Topic 842 are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Management believes that the adoption of this guidance will not have a material impact on our consolidated financial statements. |
Polymedix Inc. Asset Acquisitio
Polymedix Inc. Asset Acquisition Patent Rights and Equipment | 12 Months Ended |
Jun. 30, 2016 | |
Notes to Financial Statements | |
Note 4 - Polymedix Inc. Asset Acquisition Patent Rights and Equipment | On September 4, 2013, the Company purchased substantially all of the assets (“Purchased Assets”) of Polymedix Inc, and Polymedix Pharmaceuticals, Inc. (“Seller”) from the U.S. Bankruptcy Court. The aggregate purchase price for the sale and transfer of the Purchased Assets was $2.1 million in cash, plus 1.4 million shares of the Company’s Class A common stock (the “Registrable Securities”), for a total aggregate purchase price of approximately $4.8 million. These common shares were valued at $1.93 per share, based on the September 4, 2013 opening stock price as quoted on the OTB Bulletin Board, resulting in approximately $2.7 million of stock issued to acquire the Purchased Assets. ASC 805, Business Combinations, provides guidance on determining whether an acquired set of assets meets the definition of a business for accounting purposes. Under the framework, the acquired set of activities and assets have to be capable of being operated as a business, from the viewpoint of a market participant as defined in ASC 820, Fair Value Measurements. Two essential elements required for an integrated set of activities are inputs and outputs. The Company evaluated the Asset Purchase Agreement and in accordance with the guidance, determined it did not meet the definition of a business acquisition as the acquisition consisted solely of the two primary compounds, Brilacidin and related compounds, and Delparantag and related compounds, and certain other tangible assets. The Company did not acquire the right to any employees previously involved with the technology, or research processes previously in place at Seller. The Company has therefore accounted for the transaction as an asset acquisition. The purchase price was allocated to the identified tangible and intangible assets acquired based on their relative fair values, which were derived from their individual estimated fair values of $96,000 and $4,706,000, respectively. The following table summarizes the purchase price allocation for the assets acquired: Intangible assets – patents rights – Brilacidin, Delparantag and other related compounds $ 4,706,000 Tangible assets - Laboratory equipment and computer systems $ 96,000 These acquired tangible assets of $96,000 were expensed to research and development costs in September 2013. During the year ended June 30, 2016, the Company wrote off $377,000 of the carrying value of Purchased Patents Rights – Delparantag and related compound (see Note 5). |
Patents, net
Patents, net | 12 Months Ended |
Jun. 30, 2016 | |
Notes to Financial Statements | |
Note 5 - Patents, net | Patents, net consisted of the following (rounded to nearest thousand): Useful life June 30, 2016 June 30, 2015 Purchased Patent Rights– Brilacidin, and related compounds (note 4) 14 $ 4,082,000 $ 4,082,000 Purchased Patent Rights–Delparantag and related compounds (note 4) 12 - 480,000 Purchased Patent Rights–Anti-microbial- surfactants and related compounds (note 4) 12 144,000 144,000 Patents – Kevetrin and related compounds 17 1,035,000 992,000 5,261,000 5,698,000 Less:Accumulated amortization for Brilacidin, Anti-microbial- surfactants and related compounds (855,000 ) (551,000 ) Accumulated amortization for Purchased Patent Rights–Delparantag - (73,000 ) Accumulated amortization for Patents-Kevetrin and related compounds (95,000 ) (56,000 ) $ 4,311,000 $ 5,018,000 The patents are amortized on a straight-line basis over the estimated remaining useful lives of the assets, determined 12-17 years from the date of acquisition. Amortization expense for the fiscal years ended June 30, 2016, 2015 and 2014, was approximately $404,000, $394,000 and $285,000, respectively. In 2016, $134,000 of accumulated amortization on patents was written off related to the impairment of patents recorded during the year Based on managements’ assessment of certain business factors, it was determined that certain particular patents held by the Company would not be used in the future and were therefore impaired. The Company recorded a full impairment of its patent rights to Delparantag and other patents in the latter part of April 2016. Delparantag was acquired by Cellceutix in the purchase of the patent assets from the Polymedix Estate. The Company believes that the Delparantag compound, which had clinical activity but also safety concerns in a prior clinical trial by Polymedix, is now a low priority compound for further development, among the compounds held in the Company’s patent portfolio and will not be placed into future clinical trials. The decision by management was also made after factoring in today’s potential regulatory and litigious climate in commercializing these compounds. During the fourth quarter of its fiscal year ended June 30, 2016, the Company recorded an impairment on the patent costs for Delparantag of approximately $377,000 (the patent cost of $480,000 less $103,000 of accumulated amortization) and recorded an impairment on the patent costs of various patents held (included in the above table under the heading Patents - Kevetrin and related compounds) of approximately $271,000 (the patent cost of $302,000 less $31,000 of accumulated amortization). As a result, a total impairment of $648,000 was recorded on the statement of operations for the year ended June 30, 2016. At June 30, 2016, the future amortization period for all patents was approximately 9.18 years to 16.40 years. Future estimated annual amortization expenses are approximately $361,000 for each year from 2017 to 2025, $351,000 for the year ending June 30, 2026, $349,000 for the year ending June 30, 2027, $111,000 for the year ending June 30, 2028, $57,000 for the year ending June 30, 2029 to year 2032 and $22,000 for year ending June 30, 2033. |
Property, plant and equipment,
Property, plant and equipment, net | 12 Months Ended |
Jun. 30, 2016 | |
Notes to Financial Statements | |
Note 6 - Property, plant and equipment, net | Property, plant and equipment, net consisted of the following (rounded to nearest thousand): June 30, 2016 June 30, 2015 Testing equipment $ 120,000 $ 52,000 Less: Accumulated depreciation (30,000 ) (14,000 ) $ 90,000 $ 38,000 Depreciation expense for the fiscal years ended June 30, 2016, 2015 and 2014 was approximately $16,000, $10,000 and $4,000, respectively. |
Accrued Expenses
Accrued Expenses | 12 Months Ended |
Jun. 30, 2016 | |
Notes to Financial Statements | |
Note 7 - Accrued Expenses | Accrued expenses consisted of the following (rounded to nearest thousand): June 30, 2016 June 30, 2015 Accrued research and development consulting fees $ 25,000 $ 478,000 Accrued rent (Note 10) – related parties 32,000 42,000 Accrued interest – related parties 40,000 73,000 Total $ 97,000 $ 593,000 |
Accrued Salaries and Payroll Ta
Accrued Salaries and Payroll Taxes - Related Parties And Other | 12 Months Ended |
Jun. 30, 2016 | |
Notes to Financial Statements | |
Note 8 - Accrued Salaries and Payroll Taxes - Related Parties And Other | Accrued salaries and payroll taxes consisted of the following (rounded to nearest thousand): June 30, 2016 June 30, 2015 Accrued salaries – related parties $ 2,647,000 $ 2,647,000 Accrued payroll taxes – related parties 130,000 130,000 Withholding tax 57,000 65,000 Total $ 2,834,000 $ 2,842,000 On December 29, 2010, the Company entered into employment agreements with its two executive officers, Leo Ehrlich, the Company’s Chief Executive Officer, and Krishna Menon, Chief Scientific Officer. Both agreements provide for a three year term with each executive receiving an annual base salary of $350,000 per year commencing January 1, 2011, with an annual increase of 10% for each year commencing January 2012. The Board, at its discretion, may increase the base salary based upon relevant circumstances. On January 1, 2014 the Board approved the extension of the employment agreements for a one year period with a 10% increase in salary from the calendar year 2013 annual salary of $423,500, to an annual salary of $465,850. Until new employment agreements are entered into, we will continue paying the officer’s salaries at this rate per annum. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Jun. 30, 2016 | |
Notes to Financial Statements | |
Note 9 - Commitments and Contingencies | Lease Commitments Operating Leases The Company signed a lease extension agreement with Cummings Properties which began on October 1, 2013. The lease is for a term of five years ending on September 30, 2018, and requires monthly payments of $18,000. Innovative Medical Research Inc., a company owned by Leo Ehrlich and Dr. Krishna Menon, officers of the Company, have co-signed the lease and will sublease 200 square feet of space previously used by the Company and pay the Company $900 per month. As of June 30, 2016, future minimum lease payments to Cummings Properties required under the non-cancelable operating lease are as follows (rounded to nearest thousand): Year ending June 30, 2017 $ 214,000 2018 214,000 2019 55,000 Total minimum payments $ 483,000 Rent expense, net of lease income, under this operating lease agreement was approximately $203,000, $207,000 and $162,000 for the years ended June 30, 2016, 2015 and 2014, respectively. Before September, 2013, the Company paid rent to KARD for share of office space and details are shown at Note 10. Related Party Transactions. Contractual Commitments The Company has no contractual minimum commitments to Contract Research Organizations as of June 30, 2016. Services are billed to Cellceutix, when performed by the vendors. Employment Agreement On June 27, 2016, the Company and Dr. Bertolino entered into an executive employment agreement as the Chief Medical Officer of Cellceutix Corporation, effective on June 27, 2016 (See Note 13). Litigation A complaint entitled OÂ’Connell v. Cellceutix Corp. et al. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Jun. 30, 2016 | |
Notes to Financial Statements | |
Note 10 - Related Party Transactions | Office Lease Dr. Menon, the Company’s principal shareholder, President, and Director, also serves as the Chief Operating Officer and Director of Kard Scientific (“KARD”). On December 7, 2007, the Company began renting office space from KARD, on a month to month basis for $900 per month. This continued through August 2013 and since September 1, 2013, the Company no longer leases space from Kard. For the years ended June 30, 2016, 2015 and 2014, the Company has included approximately $0, $0 and $1,800 of rent expense paid to KARD in general and administrative expenses, respectively. At June 30, 2016 and June 30, 2015, rent payables to KARD of approximately $32,000 and $42,000, respectively, were included in accrued expenses. In September 2013, the Company signed a lease extension agreement with Cummings Properties for the company’s offices and laboratories at 100 Cummings Center, Suite 151-B Beverly, MA 01915. The lease is for a term of five years from October 1, 2013 to September 30, 2018 and requires monthly payments of approximately $18,000. Cellceutix had taken over the space occupied by KARD. In addition, Innovative Medical Research Inc., (“Innovative Medical”) a company owned by Leo Ehrlich and Dr. Krishna Menon, officers of Cellecutix has co-signed the lease and will rent approximately 200 square feet of office space, the space previously used by Cellceutix and will pay Cellceutix $900 per month , the same amount Cellceutix previously paid KARD. Innovative Medical paid total rent of $31,000 to Cellceutix from September 1, 2013 to June 30, 2016 and the rental payment was offset with the accrued rent owed to KARD. Clinical Studies The Company previously engaged KARD to conduct specified pre-clinical studies. The Company did not have an exclusive arrangement with KARD. All work performed by KARD needed prior approval by the executive officers of the Company, and the Company retained all intellectual property resulting from the services by KARD. The Company now has its own research study capabilities and no longer uses KARD. At June 30, 2016 and June 30, 2015, the accrued research and development expenses to KARD was approximately $1,486,000 and $1,686,000, respectively and this amount was included in accounts payable. |
Note Payable-Related Party
Note Payable-Related Party | 12 Months Ended |
Jun. 30, 2016 | |
Notes to Financial Statements | |
Note 11 - Note Payable - Related Party | During the year ended June 30, 2010, Mr. Ehrlich loaned the Company a total of approximately $973,000. A condition for this note was that the Ehrlich Promissory Note A and Ehrlich Promissory Note B be replaced with a new note, Ehrlich Promissory Note C . On May 8, 2012, the Company did not have the ability to repay the Ehrlich Promissory Note C loan and agreed to change the interest rate on the outstanding balance of principal and interest of approximately $2,248,000, as of March 31, 2012, from 9% simple interest to 10% simple interest, and the Company issued 2,000,000 Equity Incentive Options exercisable at $0.51 per share equal to 110% of the closing bid price of $0.46 per share on May 7, 2012. Options are valid for ten (10) years from the date of issuance. At June 30, 2016 and June 30, 2015, approximately $40,000 and $73,000, respectively, was accrued as interest expense on this note. At June 30, 2016 and June 30, 2015, principal balances of the demand note was approximately $2,022,000. |
Weighted Average Shares Outstan
Weighted Average Shares Outstanding | 12 Months Ended |
Jun. 30, 2016 | |
Notes to Financial Statements | |
Note 12 - Weighted Average Shares Outstanding | Weighted average shares of common stock outstanding used in the calculation of basic and diluted earnings per share were as follows: Years Ended June 30, 2016 2015 2014 Weighted average shares outstanding-basic 119,908,145 115,087,368 105,044,985 Dilutive options and restricted stock - - - Weighted average shares outstanding-diluted 119,908,145 115,087,368 105,044,985 Antidilutive securities not included: Options 44,570,736 42,953,318 43,485,670 Warrants 25,000 1,507,000 2,448,000 44,595,736 44,460,318 45,933,670 |
Stock Options and Warrants
Stock Options and Warrants | 12 Months Ended |
Jun. 30, 2016 | |
Notes to Financial Statements | |
Note 13 - Stock Options and Warrants | Consulting Agreement On April 1, 2009, the Company entered into an agreement, subsequently amended, with a Consultant to assist the Company’s Chief Scientific Officer to organize, manage and display data from animal studies as well as information relating to Active Pharmaceutical Ingredients and formulations of the Company’s products through November 2010. The Consultant was compensated at the rate of $4,000 per month payable on the last day of each month. In addition, at the end of each month of services provided, the Consultant is granted options to purchase 10,000 shares of Company’s common stock. Effective September 1, 2010, the Company has extended the current agreement and beginning in August 2010, the monthly fee was increased to $5,000. The monthly fee was increased to $6,000 beginning in November 2012. The remainder of the agreement remains unchanged. Through June 30, 2013, the Consultant had been awarded a total of 480,000 options to purchase common stock valued at inception approximately $284,000 to be vested over one year from date of issuance. Effective April 1, 2013, the consulting agreement was terminated and the consultant was employed as an employee. For the fiscal years ended June 30, 2016, June 30, 2015 and 2014, the Company has expensed $0, $0, $54,000, respectively, to professional fees expense, related to these options and remeasurement. Stock Options The fair value of options granted for the years ended June 30, 2016, 2015 and 2014 was estimated on the date of grant using the Black Scholes model that uses assumptions noted in the following table. Year Ended June 30 2016 2015 2014 Expected term (in years) 3 - 10 3 3-5 Expected stock price volatility 56.52% to 112.71% 62.79% to 65.84% 91.25%-124.94% Risk-free interest rate 0.88% to 1.74% 0.76% to 1.19% 0.9% – 1.98% Expected dividend yield 0 0 0 On April 5, 2009 the Board of Directors of the Registrant adopted the 2009 Stock Option Plan (“the Plan”). The Plan permits the grant of 2,000,000 shares of both Incentive Stock Options (“ISOs”), intended to qualify under section 422 of the Code, and Non-Qualified Stock Options. 2010 Equity Incentive Plan Under the 2010 Equity Incentive Plan the total number of shares of Common Stock reserved and available for issuance under the Plan shall be 45,000,000 shares. Shares of Common Stock under the Plan (“Shares”) may consist, in whole or in part, of authorized and unissued shares or treasury shares. The term of each Stock Option shall be fixed by the Committee; provided, however, that an Incentive Stock Option may be granted only within the ten-year period commencing from the Effective Date and may only be exercised within ten years of the date of grant (or five years in the case of an Incentive Stock Option granted to an optionee who, at the time of grant, owns Common Stock possessing more than 10% of the total combined voting power of all classes of voting stock of the Company (10% Shareholder). 2016 Equity Incentive Plan On June 30, 2016, the Board adopted the Cellceutix Corporation 2016 Equity Incentive Plan (the "Plan"). The Plan became effective upon adoption by the Board on June 30, 2016. Up to 20,000,000 shares of the Company's common stock may be issued under the Plan (subject to adjustment as described in the Plan); provided that, no Outside Director (as defined in the Plan) may be granted awards covering more than 250,000 shares of common stock in any year and no participant shall be granted, during any one year period, options to purchase common stock and stock appreciation rights with respect to more than 4,000,000 shares of common stock in the aggregate or any other awards with respect to more than 2,500,000 shares of common stock in the aggregate. The Plan permits the grant of incentive stock options, non-qualified stock options, stock appreciation rights, restricted awards, performance share awards and performance compensation awards to employees, directors, and consultants of the Company and its affiliates. In connection with adoption of the Plan, the Board of Directors also approved the forms of Incentive Stock Option Agreement for Employees, Non-qualified Stock Option Agreement for Employees, Non-qualified Stock Option Agreement for Non-Employee Directors, Restricted Stock Award Agreement for Employees and Restricted Stock Award Agreement for Non-Employee Directors that will be utilized by the Company to grant options and restricted shares under the Plan. For the fiscal year ended June 30, 2016 On July 10, 2015, the Company issued 7,028 shares and 50,000 stock options to purchase shares of the Company’s common stock, par value $0.0001 per share to a consultant for his service rendered. The stock options valued at approximately $60,000, based on the closing bid price as quoted on the OTC on July 10, 2015 at $2.64 per share. These options were issued with an exercise price of $2.49 and vested immediately, with a three year option term. These options have piggyback registration rights. The Company recorded approximately $60,000 of stock option expenses during the year ended June 30, 2016. On September 30, 2015, the Company recorded approximately $20,000 of stock option expenses regarding the 50,000 stock options to purchase shares of the Company’s common stock, par value $0.0001 per share, at $2.93 per share to Dr. William James Alexander. On November 5, 2015, the Company issued one million stock options to purchase shares of the Company’s common stock, par value $0.0001 per share to a law firm for services, valued at approximately $432,000, based on the closing bid price as quoted on the OTC on November 5, 2015 at $1.36 per share. These options were issued with an exercise price of $1.70 and vested immediately, with a three year option term. These options have piggyback registration rights. The Company recorded approximately $432,000 of stock option expenses during the year ended June 30, 2016. On February 16, 2016, the Company issued 119,424 stock options to purchase shares of the Company’s common stock, par value $0.0001 per share to two consultants for services, valued at approximately $55,000, based on the closing bid price as quoted on the OTC on February 16, 2016 at $1.15 per share. These options were issued with an exercise price of $1.105. One third vested immediately, one third will be vested in six months (August 11, 2016), and the balance will be vested on February 11, 2017, and will be valid for a period of three years. These options have piggyback registration rights. The Company recorded approximately $39,000 of stock option expenses during the year ended June 30, 2016. On April 6, 2016, the Company issued 25,000 shares and 25,000 stock options to purchase shares of the Company’s common stock, par value $0.0001 per share to a consultant for service. The stock options valued at approximately $14,000, based on the closing bid price as quoted on the OTC on April 6, 2016 at $1.61 per share. These options were issued with an exercise price of $1.77 and shall vest on April 30, 2017, with a three year option term. These options have piggyback registration rights. The Company recorded approximately $3,000 of stock option expenses during the year ended June 30, 2016. On June 10, 2016, the Company issued 19,655 stock options to purchase shares of the Company’s common stock, par value $0.0001 per share each to three directors for service, valued at approximately $60,000, based on the closing bid price as quoted on the OTC on June 10, 2016 at $1.58 per share. These stock options were issued with an exercise price of $1.58 and vested immediately, with a five year option term. These options have piggyback registration rights. The Company recorded approximately $60,000 of stock option expenses during the year ended June 30, 2016. On June 27, 2016, the Company and Dr. Bertolino entered into an executive employment agreement as our Chief Medical Officer of Cellceutix Corporation, effective on June 27, 2016. Commencing on June 27, 2016, the Company agreed to pay Dr. Bertolino an annual salary of $440,000. In addition, the Company agreed to grant to Dr. Bertolino under the Cellceutix Corporation 2016 Equity Incentive Plan (i) 1,066,667 shares of restricted stock and (ii) a ten-year option to purchase 617,839 shares of the Company's Class A common stock at an exercise price of $1.39 per share. Both shares and options shall vest upon the earliest to occur of the following: (1) 50% upon the first anniversary of the Effective Date, and the remaining 50% upon the second anniversary of the Effective Date (2) completion of both a Phase 2b psoriasis study and a Phase 2 oral mucositis study; (3) the Company’s common stock closes above $3.00 per share (as may be adjusted for any stock splits or similar actions); (4) the commencement of trading of the Company’s common stock on a national securities exchange (e.g. Nasdaq or the NYSE); or (5) upon a Change in Control of the Company. The 1,066,667 shares were valued at approximately $1.5 million, which will be amortized over two years to June 27, 2018 (see Note 14). The 617,839 stock options valued at approximately $800,000 and will be exercisable for 10 years at an exercise price of $1.5 per share. It will be amortized over 2 years to June 27, 2018 and the Company recorded approximately $5,000 of stock option expenses for the year ended June 30, 2016. The Company recognized approximately $713,000, $400,000 and $548,000 of total stock based compensation costs for the years ended June 30, 2016, 2015 and 2014, respectively. The $713,000 of stock based compensation expense for the year ended June 30, 2016 included approximately $619,000 of stock options expenses and $94,000 of stock awards (see Note 14). For the fiscal years ended June 30, 2015 and 2014 On April 1, 2014 the Board of Directors approved a stock option grant, for services rendered from January 7, 2014 to July 6, 2014, to a consultant to purchase 40,000 shares of common stock exercisable at $1.64 per share. The option was vested on April 1, 2014, the option life is 5 years and will expire on March 31, 2019. In addition, the Company will pay the consultant $20,000 per month during the six month period from January 7, 2014 to July 6, 2014. The total value of this 40,000 shares of stock option was $55,396 and charged to additional paid-in capital on April 1, 2014. The assumptions we used in the Black Scholes option-pricing model were disclosed as above. On October 20, 2014 the Board of Directors approved the appointment of Dr. William James Alexander as the Chief Operations Officer of Cellceutix Corporation for the term of one year effective October 27, 2014 (“the Effective Date”). Pursuant to his employment agreement, Dr. Alexander received immediately 50,000 shares of the Company's common stock, par value $0.0001 per share ("Common Stock") as a sign on bonus and 50,000 stock options to purchase shares of the Company’s common stock, par value $0.0001 per share, at $2.93 per share. Such options vest in equal installments on July 27, 2015 and October 27, 2015 and the option life is 3 years and expires on July 27, 2018 and October 27, 2018, respectively. On December 26, 2014 the Board of Directors approved the cash and option bonus payments to officers and employees, including cash of $250,000 each to Mr. Leo Ehrlich, our CEO and Dr. Krishna Menon, our President, and 25,000 options exercisable for 3 years at $4.71 per share of common stock to Dr. William James Alexander, our COO and 65,000 options exercisable for 3 years at $4.29 per share of common stock, to our employees. On May 12, 2015, the Company issued 15,000 options to a consultant for his one year contract and exercisable for 3 years at $2.56 per share of common stock. The total value of these 15,000 shares of stock option was approximately $17,000 and we recognized approximately $17,000 of stock based compensation costs and charged to additional paid-in capital as of June 30, 2015. The assumptions we used in the Black Scholes option-pricing model were disclosed as above. The following table summarizes all stock option activity under the plans: Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Life (Years) Aggregate Intrinsic Value Outstanding at June 30, 2013 39,142,500 $ 0.14 7.47 $ 64,169,000 Granted 40,000 1.64 Exercised (25,000 ) 0.20 Forfeited/expired (150,000 ) 0.23 Outstanding at June 30, 2014 39,007,500 $ 0.14 6.50 $ 59,613,000 Granted 155,000 3.75 Exercised (320,000 ) 0.35 Forfeited/expired (80,000 ) 0.38 Outstanding at June 30, 2015 38,762,500 $ 0.15 5.54 $ 94,217,650 Granted 1,871,228 1.58 Exercised (74,000 ) 0.55 Forfeited/expired (115,000 ) 0.61 Outstanding at June 30, 2016 40,444,728 0.22 4.58 $ 48,185,911 Exercisable at June 30, 2016 39,722,303 $ 0.20 4.50 $ 48,163,220 Exercise of options During the year ended June 30, 2016, the Company received an aggregate of $28,000 in total, including the $12,400 of subscription receivable of 2015 and the $15,470 for the exercise of 14,000 Common Stock options at $1.105 per share. In addition, the Company recorded subscription receivable of $25,400 for the exercise of 60,000 options at a price from $0.17 to $0.64 per share (See Note 14). During the year ended June 30, 2015, the Company received an aggregate of $99,600 in total and recorded subscription receivable of $12,400 for the exercise of 320,000 options at a price from $0.20 to $0.47 per (See Note 14). During the year ended June 30, 2014, the Company received an aggregate of $5,000 in total of the exercise of 25,000 Common Stock options at $0.20 per share (See Note 14). Stock Warrants For the fiscal year ended June 30, 2016 During the year ended June 30, 2016, there were no warrants issued and there were 1,482,000 warrants expired. For the fiscal year ended June 30, 2015 On July 11, 2014, the Company issued 200,000 Class A common shares par value $.0001 to a warrant holder upon exercise of Common Stock Purchase Warrants exercisable at $1 per share. The Company received an aggregate of $200,000 in total for the exercise of 200,000 warrants. The issuance was exempt from registration under Section 4(2) of the Securities Act. On November 24, 2014, the Company issued 370,500 Class A common shares par value $.0001 to a warrant holder upon exercise of Common Stock Purchase Warrants exercisable at $1 per share and 370,500 Class A common shares par value $.0001 to a warrant holder upon exercise of Common Stock Purchase Warrants exercisable at $0.50 per share. The Company received an aggregate of $556,000 in total for the exercise of 741,000 warrants. The issuance was exempt from registration under Section 4(2) of the Securities Act. For the fiscal year ended June 30, 2014 From July 19, 2013 to June 30, 2014, the Company issued 2,300,000 Class A common shares par value $.0001 to a warrant holder upon exercise of Common Stock Purchase Warrants exercisable at $1 per share. The Company received an aggregate of $2,300,000. The issuance was exempt from registration under Section 4(2) of the Securities Act. In addition, on January 3, 2014, the Company issued 200,000 Class A common shares par value $.0001 to same warrant holder upon exercise of Common Stock Purchase Warrants exercisable at $1 per share and received an aggregate of $200,000 (See Note 14 Equity Transactions). On December 31, 2013, the Company issued 848,084 Class A common shares par value $.0001 to two warrant holders upon exercise of Common Stock Purchase Warrants exercisable at the range from $0.39 to $0.53 per share, with total of $400,000. The Company received $400,000 as a Subscription Receivable on April 1, 2014. The issuance was exempt from registration under Section 4(2) of the Securities Act. Extension of the expiration date of an aggregate of 2,223,000 Series B, Series C, and Series D common share purchase warrants On December 1, 2013, 2,223,000 Series B, Series C, and Series D common share purchase warrants issued by the Company were modified to extend their maturity date to December 31, 2015. As the Company is in an accumulated deficit position, the deemed dividend was charged against additional paid-in-capital for common shares, there being no retained earnings from which to declare a dividend. The net income (loss) attributable to common shareholders reflects both the net income (loss) and the deemed dividend. The deemed dividend of $1,980,000 was computed as the incremental value of the modified warrants over the unmodified warrants on the modification date using a per share price of the range from $0.50 to $1.50 per share which were the contemporaneous private placement offering price. Assumptions used in the Black Scholes option-pricing model for these warrants were as follows: Average risk-free interest rate 0.29 % Average expected life- years 2 Expected volatility 55.22 % Expected dividends 0 On January 23, 2014, the Company issued 25,000 shares of restricted common stock and 25,000 common share purchase warrants exercisable at $1.79 a share to one consultant. The shares will be vested on March 31, 2014, valued at approximately $45,000 and the option life is three years and valued at approximately $29,000. The following table summarizes stock warrants: Warrants Weighted Average Exercise Price Weighted Average Remaining Contractual Life (Years) Aggregate Intrinsic Value Outstanding at June 30, 2013 5,571,084 $ 0.92 1.43 $ 4,794,000 Extended 2,223,000 1.00 1.50 Granted 25,000 1.79 2.57 Exercised (3,148,084 ) 1.00 - Expired (2,223,000 ) 1.00 - Outstanding at June 30, 2014 2,448,000 $ 1.01 1.43 $ 1,623,000 Extended - - - Granted - - - Exercised (941,000 ) 0.80 - Expired - - - Outstanding at June 30, 2015 1,507,000 $ 1.14 0.52 $ 2,156,310 Extended - - - Granted - - - Exercised - - - Expired (1,482,000 ) 1.13 - Outstanding at June 30, 2016 25,000 $ 1.79 0.56 $ - Exercisable at June 30, 2016 25,000 $ 1.79 0.56 $ - |
Stock Transactions
Stock Transactions | 12 Months Ended |
Jun. 30, 2016 | |
Notes to Financial Statements | |
Note 14 - Stock Transactions | For the fiscal year ended June 30, 2016 Issuance of Common Stock for Cash $30 million Class A Common Stock Purchase Agreement with Aspire Capital Fund, LLC During the year ended June 30, 2016, the Company had completed sales to Aspire totaling 5,700,000 shares of common stock generating gross proceeds of approximately $8.2 million. The amortized amount of $136,000 and $5,000 were debited to additional paid-in capital during the year ended June 30, 2016 and 2015. The unamortized portion is carried on the balance sheet as deferred offering costs and was $358,000 and $494,000 at June 30, 2016 and 2015, respectively. Issuance of Common Stock by Exercise of Common Stock Options During the year ended June 30, 2016, the Company received cash of $15,000 in total and recorded subscription receivable of $25,400 for the exercise of 74,000 Common Stock options at a range of $0.42 to $1.11 per share. Issuance of Common Stock to Consultants For Services On July 10, 2015, the Company issued 7,028 shares of restricted Class A common shares, par value $.0001 and 50,000 stock options to purchase shares of the Company’s common stock to a consultant for services rendered. The shares were granted and vested on July 10, 2015. The shares were valued at $17,500. On February 9, 2016, the Company issued 10,000 shares of Class A common shares, par value $.0001 to a consultant for services rendered. The shares were granted and vested on February 9, 2016. The shares were valued at $11,200. On April 6, 2016, the Company issued 25,000 shares of Class A common shares, par value $.0001 and 25,000 stock options to purchase shares of the Company’s common stock, to a consultant for services rendered. The shares were granted and vested on April 6, 2016 and the options were exercisable for 3 years at $1.77 per share of common stock (see note 13). The shares were valued at $40,000. On May 22, 2016, the Company issued 5,000 shares of Class A common shares, par value $.0001 each to two consultants for services rendered. The shares were granted and vested on May 22, 2016. The shares were valued at $16,400. Issuance of Common Stock - Employment Agreement On June 27, 2016, the Company and Dr. Bertolino entered into an executive employment agreement as our Chief Medical Officer of Cellceutix Corporation, effective on June 27, 2016. Commencing on June 27, 2016, the Company agreed to pay Dr. Bertolino an annual salary of $440,000. In addition, the Company agreed to grant to Dr. Bertolino under the Cellceutix Corporation 2016 Equity Incentive Plan (i) 1,066,667 shares of restricted stock and (ii) a ten-year option to purchase 617,839 shares of the Company's Class A common stock at an exercise price of $1.39 per share. Both shares and options shall vest upon the earliest to occur of the following: (1) 50% upon the first anniversary of the Effective Date, and the remaining 50% upon the second anniversary of the Effective Date (2) completion of both a Phase 2b psoriasis study and a Phase 2 oral mucositis study; (3) the Company’s common stock closes above $3.00 per share (as may be adjusted for any stock splits or similar actions); (4) the commencement of trading of the Company’s common stock on a national securities exchange (e.g. Nasdaq or the NYSE); or (5) upon a Change in Control of the Company. The 1,066,667 shares were valued at approximately $1.5 million and it will be amortized over 2 years to June 27, 2018. The Company recorded approximately $8,000 of stock-based compensation for the year ended June 30, 2016. The Company may award Dr. Arthur P. Bertolino an annual bonus at the sole discretion of the Board of Directors of the Company. The Company may accelerate the amortization of the $1.5 million stock-based compensation expense if there are conditions which will accelerate the vesting, as mentioned above. The following summarizes our restricted stock unit activity for the above restricted stock issuance: Number of Units Weighted Average Grant Date Fair Value Total awards outstanding at June 30, 2015 - $ - Total units vested - Total units non-vested 1,066,667 $ 1.4 Total shares outstanding at June 30, 2016 1,066,667 $ 1.4 Scheduled vesting for outstanding restricted stock units at June 30, 2016 is as follows: Year Ending June 30, 2017 2018 2019 Total Scheduled vesting—restricted stock units 533,333 533,334 - 1,066,667 As of June 30, 2016, there was $1.49 million of net unrecognized compensation cost related to unvested restricted stock-based compensation arrangements. This compensation is recognized on a straight line basis resulting in approximately $0.75 million of the compensation expected to be expensed in the next twelve months, and the total unrecognized has a weighted average recognition period of 1.99 years. For the fiscal year ended June 30, 2015 Issuance of Common Stock for Cash $20 million Class A Common Stock Purchase Agreement with Aspire Capital Fund, LLC During the period from October 25, 2013 to March 5, 2015, the Company had completed sales to Aspire totaling 8,890,379 shares of common stock generating gross proceeds of approximately $20 million. The amortized amount of the commitment fee of $295,000 and $77,000 were debited to additional paid-in capital during the year ended June 30, 2015 and 2014, respectively. $30 million Class A Common Stock Purchase Agreement with Aspire Capital Fund, LLC On March 30, 2015, the Company entered into a common stock purchase agreement (the “March 2015 Agreement”) with Aspire Capital Fund, LLC, an Illinois limited liability company, which provides that, upon the terms and subject to the conditions and limitations set forth therein, Aspire Capital is committed to purchase up to an aggregate of $30.0 million of the Company's common stock over the 36-month term of the March 2015 Agreement. In consideration for entering into the March 2015 Agreement, the Company issued to Aspire Capital 160,000 shares of its Class A Common Stock as a commitment fee. The commitment fee of approximately $499,000 will be amortized as the funding is received. The amortized amount of $5,000 was debited to additional paid-in capital during the year ended June 30, 2015. The unamortized portion is carried on the balance sheet as deferred offering costs and was $494,000 at June 30, 2015. During the period from March 30, 2015 to June 30, 2015, the Company had completed sales to Aspire totaling 100,000 shares of common stock generating gross proceeds of approximately $0.3 million. Concurrently with entering into the March 2015 Agreement, the Company also entered into a registration rights agreement with Aspire Capital, in which the Company agreed to file one or more registration statements, as permissible and necessary to register, under the Securities Act of 1933, as amended, the sale of the shares of the Company's common stock that have been and may be issued to Aspire Capital under the March 2015 Agreement. The Company has filed with the Securities and Exchange Commission a prospectus supplement, dated March 31, 2015, to the Company's prospectus filed as part of the Company's effective $75,000,000 million shelf registration statement on Form S-3, File No. 333-199725, registering all of the shares of common stock that have been or may be offered and sold to Aspire Capital from time to time. Issuance of Common Stock by Exercise of Common Stock Purchase Warrants On July 11, 2014, the Company issued 200,000 Class A common shares par value $.0001 to a warrant holder upon exercise of Common Stock Purchase Warrants exercisable at $1 per share. The Company received an aggregate of $200,000 in total for the exercise of 200,000 warrants. The issuance was exempt from registration under Section 4(2) of the Securities Act. On November 24, 2014, the Company issued 370,500 Class A common shares par value $.0001 to a warrant holder upon exercise of Common Stock Purchase Warrants exercisable at $1 per share and 370,500 Class A common shares par value $.0001 to a warrant holder upon exercise of Common Stock Purchase Warrants exercisable at $0.50 per share. The Company received an aggregate of $556,000 in total for the exercise of 741,000 warrants. The issuance was exempt from registration under Section 4(2) of the Securities Act. Issuance of Common Stock by Exercise of Common Stock Options The Board of Directors approved the exercise of 320,000 Common Stock options at a range of $0.20 – $0.45 per share for $112,000 during the year ended June 30, 2015. Issuance of Common Stock to Consultants and Employees On October 20, 2014 the Board of Directors approved the appointment of Dr. William James Alexander as the Chief Operations Officer of Cellceutix Corporation for the term of one year effective October 27, 2014. Commencing on October 20, 2014 and ending on the six month anniversary of the effective date, the Company shall pay Dr. Alexander at the per annum rate of $350,000. Commencing on the Six Month Anniversary and ending on the one year anniversary of the effective date (the "One Year Anniversary"), the Company shall pay Dr. Alexander at the per annum rate of $400,000. Pursuant to his employment agreement, Dr. Alexander received immediately 50,000 shares of the Company's common stock, par value $0.0001 per share as a sign on bonus and 50,000 stock options vesting during the next 12 months. The Company may award Dr. Alexander an annual bonus at the sole discretion of the Board of Directors of the Company. On May 12, 2015, the Company issued 15,000 shares of restricted Class A common shares, par value $.0001 and 15,000 options, to a consultant for services rendered. The shares were granted on May 12, 2015 and vested on May 31, 2015. The shares were valued at $38,400 which were charged to additional paid-in capital as of June 30, 2015. The Company recognized approximately $55,000 of stock based compensation costs related to stock and the stock option issued to this consultant for the year ended June 30, 2015. For the fiscal year ended June 30, 2014 Polymedix Trustee On September 4, 2013, the Company purchased substantially all of the assets of Polymedix Inc, and Polymedix Pharmaceuticals, Inc. from the U.S. Bankruptcy Court. The purchase price included the issuance of 1,400,000 shares of the Company’s Class A common stock at $1.93 and recorded at $1,302,000, net of $1,400,000 of Redeemable Common Stock Liability under Current Liability. Issuance of Common Stock for Cash $20 million Class A Common Stock Purchase Agreement with Aspire Capital Fund, LLC – October 2013 Agreement On October 25, 2013, we terminated a previous agreement with Aspire Capital Fund, LLC, an Illinois limited liability company (Aspire Capital), and entered into a new Class A Common Stock Purchase Agreement (the “Purchase Agreement”) with Aspire Capital, which provides that upon meeting the terms of the agreement, Aspire Capital is committed to purchase up to an aggregate of $20,000,000 of our shares of Class A Common Stock over the approximately 36-month term of the Purchase Agreement. In consideration for entering into the Purchase Agreement, the Company issued to Aspire Capital 210,523 shares of our Class A Common Stock as a commitment fee. The commitment fee of $373,000 will be amortized as the funding is received. The amortized amount of $77,000 was debited to additional paid-in capital in 2014. The unamortized portion is carried on the balance sheet as deferred offering costs and was $295,000 at June 30, 2014. Concurrently with entering into the Purchase Agreement, the Company agreed to file one or more registration statements as permissible and necessary under the Securities Act of 1933, as amended, or the Securities Act, for the sale of shares of our Class A Common Stock that have been and may be issued to Aspire Capital under the Purchase Agreement. On November 4, 2013, the Company filed a Form S-3 registration statement and the registration statement was declared effective by the SEC on November 15, 2013. Under the Purchase Agreement, on any trading day selected by Cellceutix which the closing sale price of our Class A Common Stock exceeds $0.25 per share, we may direct Aspire Capital to purchase up to 200,000 shares of our Class A Common Stock per trading day. The Purchase Price of such shares is equal to the lesser of a) the lowest sale price of our Class A Common Stock on the purchase date; or b) the arithmetic average of the three lowest closing sale prices for our Class A Common Stock during the twelve consecutive trading days ending on the trading day immediately preceding the purchase date. In addition, on any date on which we submit a Purchase Notice to Aspire Capital for purchase of at least 100,000 Purchase Shares and the closing sale price of our stock is equal to or greater than $0.50 per share, we also have the right to direct Aspire Capital to purchase an amount of stock equal to up to 30% of the aggregate shares of the our Class A Common Stock traded on the OTC Bulletin Board on the next trading day, subject to the VWAP Purchase Share Volume Maximum and the VWAP Minimum Price Threshold, which is equal to the greater of (a) 90% of the closing price of our Class A Common Stock on the business day immediately preceding the VWAP Purchase Date or (b) such higher price as set forth by the Company in the VWAP Purchase Notice. The VWAP Purchase Price of such shares is the lower of (a) the Closing Sale Price on the VWAP Purchase Date; or 95% of the volume-weighted average price for our Class A Common Stock traded on the OTC Bulletin Board; and (b)on the VWAP Purchase Date, if the aggregate shares to be purchased on that date have not exceeded the VWAP Purchase Share Volume Maximum or during that portion of the VWAP Purchase Date until such time as the sooner to occur of (i) the time at which the aggregate shares traded on the OTC Bulletin Board exceed the VWAP Purchase Share Volume Maximum or (ii) the time at which the sale price of our Class A Common Stock falls below the VWAP Minimum Price Threshold. The purchase price will be adjusted for any reorganization, recapitalization, non-cash dividend, stock split, or other similar transaction occurring during the trading day(s) used to compute the purchase price. We may deliver multiple Purchase Notices and VWAP Purchase Notices to Aspire Capital from time to time during the term of the Purchase Agreement, so long as the most recent purchase has been completed. Under the Purchase Agreement, we and Aspire Capital may not affect any sales of shares of our Class A Common Stock under the Purchase Agreement on any trading day that the closing sale price of our Class A Common Stock is less than $0.25 per share. The Company is never under any obligation to sell shares to Aspire Capital Fund. Aspire Capital Fund has no rights to require the Company to sell shares. During the period from October 25, 2013 to June 30, 2014, the Company had completed sales to Aspire totaling 2,500,000 shares of common stock generating gross proceeds of approximately $4.2 million. As of June 30, 2014, a balance of $15.8 million remains and is available under the financing arrangement. From July 1, 2014 to September 10, 2014, the Company has generated additional proceeds of approximately $3,215,000 under the Common Stock Purchase Agreement with Aspire from the sale 1,900,000 shares of its common stock. Issuance of Common Stock by Exercise of Common Stock Purchase Warrants During the year ended June 30, 2014, the Company issued 2,300,000 Class A common shares par value $.0001 to a warrant holder upon exercise of Common Stock Purchase Warrants exercisable at $1 per share. The Company received an aggregate of $2,300,000 from the exercise of these warrants. The issuance was exempt from registration under Section 4(2) of the Securities Act. On December 31, 2013, the Company issued 848,084 Class A common shares par value $.0001 to two warrant holders upon exercise of Common Stock Purchase Warrants exercisable at the range from $0.39 to $0.53 per share, with a total exercise price of $400,000. The issuance was exempt from registration under Section 4(2) of the Securities Act. Issuance of Common Stock by Exercise of Common Stock Options On March 18, 2014, the Company issued 25,000 Class A common shares par value $.0001 upon exercise of 25,000 Common Stock options at $0.20 per share, for total proceeds of $5,000. Issuance of Common Stock to Consultants and Employees On December 17, 2013, the Company issued 5,000 shares of restricted Class A common shares par value $.0001 to one consultant valued at approximately $9,000 for prior services. On December 31, 2013, the Company issued 50,000 shares of restricted Class A common shares par value $.0001 to two consultants valued at approximately $105,000 for prior services. On December 31, 2013, the Company issued 60,000 shares of restricted Class A common shares par value $.0001 to six employees as a year-end bonus valued at approximately $96,000. On October 17, 2013, the Board of Directors approved the stock grant of 35,000 shares of restricted Class A common stock to be issued and vested on January 6, 2014 to a consultant valued at $70,000. On January 23, 2014, the Company issued 25,000 shares of restricted Class A common stock and 25,000 stock options exercisable at $1.79 per share to a consultant. The shares were granted on January 23, 2014 and vested on March 31, 2014 were valued at $44,750. The option life is three years and valued at approximately $29,000. On January 23, 2014, the Company further issued 25,000 shares of restricted Class A common shares par value $.0001 at $1.79 per share to a consultant. The shares were granted on January 23, 2014, vested on March 31, 2014, and were valued at approximately $45,000. On March 31, 2014, the Company issued 25,000 shares of restricted Class A common shares, par value $.0001, to a consultant for prior services rendered. The shares were granted and vested on March 31, 2014. The shares were valued at $41,000. |
Income Taxes
Income Taxes | 12 Months Ended |
Jun. 30, 2016 | |
Notes to Financial Statements | |
Note 15 - Income Taxes | Deferred income tax assets and liabilities are recognized for the expected future tax consequences of events that have been reflected in the consolidated financial statements. Deferred tax assets and liabilities are determined based on the differences between the book values and the tax bases of particular assets and liabilities and the tax effects of net operating loss and capital loss carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in the tax rate is recognized as income or expense in the period that included the enactment date. The Company has incurred operating losses since its inception and, therefore, no tax liabilities have been incurred for the periods presented. The amount of unused tax losses available to carry forward and apply against taxable income in future years totaled approximately $40,909,000 at June 30, 2016. The loss carryforwards expire beginning in 2028. Internal Revenue Code Sec. 382 places limitations on the utilization of net operating losses. Due to the potential limitation and the CompanyÂ’s historical losses, the Company has placed a full valuation allowance. The valuation allowance increased by approximately $5,383,000 at June 30, 2016, $5,709,000 at June 30, 2015 and $3,619,000 at June 30, 2014. The income tax provision benefit differs from the amount of tax determined by applying the Federal statutory rate as follows: June 30, 2016 June 30, 2015 June 30, 2014 Book income at federal statutory rate 34.00 % 34.00 % 34.00 % State income tax, net of federal tax benefit 5.24 % 5.31 % 5.33 % Change in valuation allowance (41.88 )% (43.43 )% (43.87 )% Research and development credit 6.97 % 8.01 % 7.69 % Permanent difference (3.16 )% (2.72 )% (2.62 )% Others - net (1.17 )% (1.17 )% (0.53 )% Total 0.00 % 0.00 % 0.00 % There was no current or deferred provision or benefit for income taxes for the years ended June 30, 2016 and 2015. The components of deferred tax assets as of June 30, 2016 and 2015 are as follows ( ) June 30, 2016 June 30, 2015 Deferred tax (liability) asset: Net operating loss carry forwards $ 16,272,000 $ 11,799,000 Accrued payroll 1,105,000 1,105,000 Stock compensation 1,653,000 1,633,000 Research and development credit 2,672,000 1,777,000 Other 162,000 166,000 $ 21,863,000 $ 16,480,000 Valuation allowance (21,863,000 ) (16,480,000 ) Total deferred taxes $ - $ - |
Subsequent Events
Subsequent Events | 12 Months Ended |
Jun. 30, 2016 | |
Notes to Financial Statements | |
Note 16 - Subsequent Events | Equity Transactions From July 1, 2016 to September 12, 2016, the Company has generated additional proceeds of approximately $1,506,000 under the Common Stock Purchase Agreement with Aspire from the sale 1,200,000 shares of its common stock. On July 18, 2016, the Company issued 7,500 shares and 7,500 stock options to purchase shares of the CompanyÂ’s common stock to a consultant for service rendered, exercisable for 3 years at $1.38 per share of common stock. The value of these 7,500 shares at $1.38 per share and 7,500 options was approximately $10,000 and $4,000, respectively, for a total expense of approximately $14,000. On August 1, 2016, the Company issued 11,720 restricted shares to a consultant for service. The value of these 11,720 shares at $1.28 per share was approximately $15,000. |
Selected Quarterly Results of O
Selected Quarterly Results of Operations (unaudited) | 12 Months Ended |
Jun. 30, 2016 | |
Notes to Financial Statements | |
Note 17 - Selected Quarterly Results of Operations (unaudited) | A summary of the CompanyÂ’s quarterly results of operations for the years ended June 30, 2016 and 2015 is as follows ( Years Ended June 30, 2016 Quarter 1 2016 Quarter 2 2016 Quarter 3 2016 Quarter 4 2016 Total 2016 Revenues $ - $ - $ - $ - $ - Gross profit $ - $ - $ - $ - $ - Net loss $ (2,577,000 ) $ (3,323,000 ) $ (3,709,000 ) $ (3,243,000 ) $ (12,852,000 ) Net loss attributable to common stockholders $ (2,577,000 ) $ (3,323,000 ) $ (3,709,000 ) $ (3,243,000 ) $ (12,852,000 ) Loss per share attributable to common stockholders -Basic $ (0.02 ) $ (0.03 ) $ (0.03 ) $ (0.03 ) $ (0.11 ) -Diluted $ (0.02 ) $ (0.03 ) $ (0.03 ) $ (0.03 ) $ (0.11 ) Weighted average number of common shares 118,140,424 118,673,362 120,204,272 122,647,514 119,908,145 Years Ended June 30, 2015 Quarter 1 2015 Quarter 2 2015 Quarter 3 2015 Quarter 4 2015 Total 2015 Revenues $ - $ - $ - $ - $ - Gross profit $ - $ - $ - $ - $ - Net loss $ (4,395,000 ) $ (2,754,000 ) $ (2,895,000 ) $ (3,101,000 ) $ (13,145,000 ) Net loss attributable to common stockholders $ (4,395,000 ) $ (2,754,000 ) $ (2,895,000 ) $ (3,101,000 ) $ (13,145,000 ) Loss per share attributable to common stockholders -Basic $ (0.04 ) $ (0.02 ) $ (0.02 ) $ (0.02 ) $ (0.11 ) -Diluted $ (0.04 ) $ (0.02 ) $ (0.02 ) $ (0.02 ) $ (0.11 ) Weighted average number of common shares 111,121,912 114,716,009 116,885,350 117,693,617 115,087,368 |
Significant Accounting Polici24
Significant Accounting Policies and Recent Accounting Pronouncements (Policies) | 12 Months Ended |
Jun. 30, 2016 | |
Significant Accounting Policies And Recent Accounting Pronouncements Policies | |
Use of Estimates | The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting periods. Significant items subject to such estimates and assumptions include contract research accruals, recoverability of long-lived assets, measurement of stock-based compensation, and the periods of performance under collaborative research and development agreements. The Company bases its estimates on historical experience and various other assumptions that management believes to be reasonable under the circumstances. Changes in estimates are recorded in the period in which they become known. Actual results could differ from those estimates. |
Cash and Cash Equivalents | Cash and cash equivalents consist of cash and short-term highly liquid investments purchased with original maturities of three months or less. There were no cash equivalents at June 30, 2016 and 2015. |
Property, plant and Equipment | Property and equipment are stated at cost, net of accumulated depreciation. Expenditures that extend the life, increase the capacity, or improve the efficiency of property and equipment are capitalized, while expenditures for repairs and maintenance are expensed as incurred. Depreciation is recognized using the straight-line method over the following approximate useful lives: Machinery and equipment 5 Years |
Intangible Assets - Patents | Costs incurred to file patent applications and acquired intangibles are capitalized when the Company believes that there is a high likelihood that the patent will be issued and there will be future economic benefit associated with the patent. These costs will be amortized on a straight-line basis over a 12 - 17 years life from the date of patent filing. All costs associated with abandoned patent applications are expensed. In addition, the Company will review the carrying value of patents for indicators of impairment on a periodic basis and if it determines that the carrying value is impaired, it values the patent at fair value. As of June 30, 2016 and 2015, carrying value of patent was approximately $4,311,000 and $5,018,000, respectively. Amortization expense for the fiscal years ended June 30, 2016, 2015 and 2014, was approximately $404,000, $394,000 and $285,000, respectively. As of June 30, 2016, the Company expensed the costs associated with obtaining patents that have not yet developed products nor which have gained market acceptance and the Company has or will let these patents go abandoned. For the fiscal years ended June 30, 2016, 2015 and 2014, the Company has charged to operations approximately $37,000, $102,000, and $136,000, respectively as patent expenses included in general and administrative expenses. In accordance with the provisions of the applicable authoritative guidance, the CompanyÂ’s long-lived assets and amortizable intangible assets are tested for impairment whenever events or changes in circumstances indicate that their carrying value may not be recoverable. The Company assesses the recoverability of such assets by determining whether their carrying value can be recovered through undiscounted future operating cash flows, including its estimates of revenue driven by assumed market segment share and estimated costs. If impairment is indicated, the Company measures the amount of such impairment by comparing the fair value to the carrying value. During the fiscal years ended June 30, 2016, 2015 and 2014, the Company has recorded impairment on patent costs of Delparantag and various patents approximately $648,000, $0, and $0, respectively and included in general and administrative expenses. |
Financial Instruments | The CompanyÂ’s financial instruments include cash, accounts payable and accrued liabilities. The carrying amounts of these financial instruments approximate their fair value, due to the short-term nature of these items. The fair value hierarchy has the following three levels: Level 1 - quoted prices in active markets for identical assets and liabilities. Level 2 - observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. Level 3 - unobservable inputs that reflect the Company's own assumptions about the assumptions market participants would use in pricing the asset or liability. |
Certain Risks and Uncertainties | Product Development We devote significant resources to research and development programs in an effort to discover and develop potential future product candidates. The product candidates in our pipeline are at various stages of preclinical and clinical development. The path to regulatory approval includes three phases of clinical trials in which we collect data to support an application to regulatory authorities to allow us to market a product for treatment of a specified disease. There are many difficulties and uncertainties inherent in research and development of new products, resulting in a high rate of failure. To bring a drug from the discovery phase to regulatory approval, and ultimately to market, takes many years and significant cost. Failure can occur at any point in the process, including after the product is approved, based on post-market factors. New product candidates that appear promising in development may fail to reach the market or may have only limited commercial success because of efficacy or safety concerns, inability to obtain necessary regulatory approvals, limited scope of approved uses, reimbursement challenges, difficulty or excessive costs of manufacture, alternative therapies or infringement of the patents or intellectual property rights of others. Uncertainties in the FDA approval process and the approval processes in other countries can result in delays in product launches and lost market opportunities. Consequently, it is very difficult to predict which products will ultimately be submitted for approval, which have the highest likelihood of obtaining approval and which will be commercially viable and generate profits. Successful results in preclinical or clinical studies may not be an accurate predictor of the ultimate safety or effectiveness of a drug or product candidate. Expenditures for research, development, and engineering of products are expensed as incurred. For the fiscal years ended June 30, 2016, 2015 and 2014, the Company incurred approximately $8,952,000, $10,531,000 and $6,344,000 of research and development costs, respectively. |
Concentrations of Credit Risk | The Company maintains its cash in bank deposit and checking accounts that at times exceed federally insured limits. Approximately $6 million is subject to credit risk at June 30, 2016. However, these cash balances are maintained at creditworthy financial institutions. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk. |
Accrued Outsourcing Costs | Substantial portions of our preclinical studies and clinical trials are performed by third-party laboratories, medical centers, contract research organizations and other vendors, or collectively "CROs". These CROs generally bill monthly or quarterly for services performed, or bill based upon milestone achievement. For preclinical studies, we accrue expenses based upon estimated percentage of work completed and the contract milestones remaining. For clinical studies, expenses are accrued based upon the number of patients enrolled and the duration of the study. We monitor patient enrollment, the progress of clinical studies and related activities to the extent possible through internal reviews of data reported to us by the CROs, correspondence with the CROs and clinical site visits. Our estimates depend on the timeliness and accuracy of the data provided by the CROs regarding the status of each program and total program spending. We periodically evaluate the estimates to determine if adjustments are necessary or appropriate based on information we receive. |
Valuation of Equity Grants | The Company accounts for all share-based payments to employees, including grants of employee stock options, to be recognized in the consolidated financial statements based on their fair values. The Company is required to measure the cost of employee services received in exchange for stock options and similar awards based on the grant-date fair value of the award and recognize this cost in the income statement over the period during which an employee is required to provide service in exchange for the award. The Company uses the Black-Scholes valuation model and has elected to use the ratable method to amortize compensation expense over the vesting period of the grant. The Company accounts for equity instruments issued to nonemployees by valuing them using the Black-Scholes valuation model. The measurement of stock-based compensation is subject to periodic adjustments as the underlying equity instruments vest. |
Income Taxes | Deferred income tax assets and liabilities arise from temporary differences associated with differences between the consolidated financial statements and tax basis of assets and liabilities, as measured by the enacted tax rates, which are expected to be in effect when these differences reverse. Deferred tax assets and liabilities are classified as current or non-current, depending upon the classification of the asset or liabilities to which they relate. Deferred tax assets and liabilities not related to an asset or liability are classified as current or non-current depending on the periods in which the temporary differences are expected to reverse. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. The Company has generated net losses since inception and accordingly has not recorded a provision for income taxes. The deferred tax assets were primarily comprised of federal and state tax net operating loss, or NOL, carryforwards. Due to uncertainties surrounding the Company’s ability to generate future taxable income to realize these tax assets, a full valuation allowance has been established to offset the deferred tax assets. Additionally, the future utilization of the NOL carryforwards to offset future taxable income may be subject to an annual limitation as a result of ownership changes that could occur in the future. If necessary, the deferred tax assets will be reduced by any carryforwards that expire prior to utilization as a result of such limitations, with a corresponding reduction of the valuation allowance. The Company follows the provisions of FASB ASC 740-10 “ Uncertainty in Income Taxes The Company has identified its U.S. Federal income tax return and its State return in Massachusetts as its major tax jurisdictions. The fiscal 2013 and forward years are still open for examination. |
Basic Earnings (Loss) per Share | Basic and diluted earnings per share are computed based on the weighted-average common shares and common share equivalents outstanding during the period. Common share equivalents consist of stock options, warrants and convertible notes payable. Common share equivalents were excluded from the computation of diluted earnings per share for the years ended June 30, 2016, 2015 and 2014, because their effect is anti-dilutive (See note 12 Weighted Average Shares Outstanding). |
Accounting for Stock Based Compensation | The stock-based compensation expense incurred by Cellceutix for employees and directors in connection with its stock option plan is based on the employee model of ASC 718, and the fair market value of the options is measured at the grant date. Under ASC 718 employee is defined as “An individual over whom the grantor of a share-based compensation award exercises or has the right to exercise sufficient control to establish an employer-employee relationship based on common law as illustrated in case law and currently under U.S. “tax regulations”. Our consultants do not meet the employer-employee relationship as defined by the IRS and therefore are accounted for under ASC 505-50. ASC 505-50-30-11 (previously EITF 96-18) further provides that an issuer shall measure the fair value of the equity instruments in these transactions using the stock price and other measurement assumptions as of the earlier of the following dates, referred to as the measurement date: i. The date at which a commitment for performance by the counterparty to earn the equity instruments is reached (a performance commitment); and ii. The date at which the counterparty’s performance is complete. We have elected to use the Black-Scholes-Merton pricing model to determine the fair value of stock options on the dates of grant. Restricted stock units are measured based on the fair market values of the underlying stock on the dates of grant. We recognize stock-based compensation using the straight-line method. The components of stock based compensation related to stock options in the Company’s Statement of Operations for the fiscal years ended June 30, 2016, 2015 and 2014 are as follows (rounded to nearest thousand): June 30, 2016 June 30, 2015 June 30, 2014 Research and development expenses Consulting fees $ 188,000 $ 55,000 $ 389,000 Employees’ bonus - 103,000 - Officers’ bonus 33,000 230,000 - Professional expenses 432,000 - - General and administrative expenses Directors’ fees 60,000 - - Employees’ bonus - 12,000 105,000 Consulting fees - - 54,000 Total share-based compensation expense $ 713,000 $ 400,000 $ 548,000 |
Recent Accounting Pronouncements | Standards Issued Not Yet Adopted In August 2014, the FASB issued ASU 2014-15, “Presentation of Financial Statements—Going Concern—Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern” (“ASU 2014-15”). The ASU 2014-15 requires management to assess an entity’s ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. ASU 2014-15 is effective for annual periods, and interim periods within those annual periods, starting after December 15, 2016; the Company’s first quarter of fiscal 2018. Management is currently evaluating the impact of this standard on our consolidated financial statements. In May 2014, the FASB issued authoritative guidance that defines how companies should report revenues from contracts with customers. The standard requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. It provides companies with a single comprehensive five-step principles based model to use in accounting for revenue and supersedes current revenue recognition requirements, including most industry-specific and transaction-specific revenue guidance. In August 2015, the FASB deferred the effective date of the new revenue standard by one year. As a result, the new standard would not be effective for the Company until 2019. In addition, the FASB is allowing companies to early adopt this guidance for non-public entities beginning in fiscal year 2017. The guidance permits an entity to apply the standard retrospectively to all prior periods presented, with certain practical expedients, or apply the requirements in the year of adoption, through a cumulative adjustment. The Company will apply this new guidance when it becomes effective and has not yet selected a transition method. The Company is currently evaluating the impact of adoption on its consolidated financial statements. In June 2014, the FASB issued ASU 2014-12, Compensation - Stock Compensation. The amendments in this ASU apply to reporting entities that grant their employees share-based payments in which the terms of the award provide that a performance target can be achieved after the requisite service period. This ASU is the final version of Proposed ASU EITF-13D--Compensation--Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period, which has been deleted. The amendments require that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. A reporting entity should apply existing guidance in Topic 718 as it relates to awards with performance conditions that affect vesting to account for such awards. As such, the performance target should not be reflected in estimating the grant-date fair value of the award. Compensation cost should be recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable to the period(s) for which the requisite service has already been rendered. If the performance target becomes probable of being achieved before the end of the requisite service period, the remaining unrecognized compensation cost should be recognized prospectively over the remaining requisite service period. The total amount of compensation cost recognized during and after the requisite service period should reflect the number of awards that are expected to vest and should be adjusted to reflect those awards that ultimately vest. The requisite service period ends when the employee can cease rendering service and still be eligible to vest in the award if the performance target is achieved. As indicated in the definition of vest, the stated vesting period (which includes the period in which the performance target could be achieved) may differ from the requisite service period. The amendments in this ASU are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015, and early adoption is permitted. Management believes that the adoption of this guidance will not have a material impact on our consolidated financial statements. In June 2015, FASB issued ASU No. 2015-10, Technical Corrections and Updates. ASU No. 2015-10 is intended to correct differences between original guidance and the Codification, clarify the guidance, correct references and make minor improvements affecting a variety of topics. ASU No. 2015-10 covers a wide range of topics in the Codification and is generally categorized as follows: Amendments Related to Differences between Original Guidance and the Codification; Guidance Clarification and Reference Corrections; Simplification; and Minor Improvements. The amendments are effective for fiscal years and interim periods within those fiscal years, beginning after December 15, 2015. Early adoption is permitted. Management believes that the adoption of this guidance will not have a material impact on our consolidated financial statements. In February 2016, FASB issued ASU No. 2016-02, Leases (Topic 842). The guidance requires that a lessee recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right of use asset representing its right to use the underlying asset for the lease term. For finance leases: the right-of-use asset and a lease liability will be initially measured at the present value of the lease payments, in the statement of financial position; interest on the lease liability will be recognized separately from amortization of the right-of-use asset in the statement of comprehensive income; and repayments of the principal portion of the lease liability will be classified within financing activities and payments of interest on the lease liability and variable lease payments within operating activities in the statement of cash flows. For operating leases: the right-of-use asset and a lease liability will be initially measured at the present value of the lease payments, in the statement of financial position; a single lease cost will be recognized, calculated so that the cost of the lease is allocated over the lease term on a generally straight-line basis; and all cash payments will be classified within operating activities in the statement of cash flows. Under Topic 842 the accounting applied by a lessor is largely unchanged from that applied under previous GAAP. The amendments in Topic 842 are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Management believes that the adoption of this guidance will not have a material impact on our consolidated financial statements. |
Significant Accounting Polici25
Significant Accounting Policies and Recent Accounting Pronouncements (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Significant Accounting Policies And Recent Accounting Pronouncements Tables | |
Schedule of components of stock based compensation related to stock options recognized in the company's statement of operations | June 30, 2016 June 30, 2015 June 30, 2014 Research and development expenses Consulting fees $ 188,000 $ 55,000 $ 389,000 EmployeesÂ’ bonus - 103,000 - OfficersÂ’ bonus 33,000 230,000 - Professional expenses 432,000 - - General and administrative expenses DirectorsÂ’ fees 60,000 - - EmployeesÂ’ bonus - 12,000 105,000 Consulting fees - - 54,000 Total share-based compensation expense $ 713,000 $ 400,000 $ 548,000 |
Polymedix Inc. Asset Acquisit26
Polymedix Inc. Asset Acquisition Patent Rights and Equipment (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Polymedix Inc. Asset Acquisition Patent Rights And Equipment Tables | |
Schedule of purchase price allocation for the assets acquired | The following table summarizes the purchase price allocation for the assets acquired: Intangible assets – patents rights – Brilacidin, Delparantag and other related compounds $ 4,706,000 Tangible assets - Laboratory equipment and computer systems $ 96,000 |
Patents, net (Tables)
Patents, net (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Patents Net Tables | |
Schedule of patents | Patents, net consisted of the following (rounded to nearest thousand): Useful life June 30, 2016 June 30, 2015 Purchased Patent Rights– Brilacidin, and related compounds (note 4) 14 $ 4,082,000 $ 4,082,000 Purchased Patent Rights–Delparantag and related compounds (note 4) 12 - 480,000 Purchased Patent Rights–Anti-microbial- surfactants and related compounds (note 4) 12 144,000 144,000 Patents – Kevetrin and related compounds 17 1,035,000 992,000 5,261,000 5,698,000 Less:Accumulated amortization for Brilacidin, Anti-microbial- surfactants and related compounds (855,000 ) (551,000 ) Accumulated amortization for Purchased Patent Rights–Delparantag - (73,000 ) Accumulated amortization for Patents-Kevetrin and related compounds (95,000 ) (56,000 ) $ 4,311,000 $ 5,018,000 |
Property, plant and equipment n
Property, plant and equipment net (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Property Plant And Equipment Net Tables | |
Summary of property, plant and equipment net | Property, plant and equipment, net consisted of the following (rounded to nearest thousand): June 30, 2016 June 30, 2015 Testing equipment $ 120,000 $ 52,000 Less: Accumulated depreciation (30,000 ) (14,000 ) $ 90,000 $ 38,000 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Accrued Expenses Tables | |
Schedule of accrued expenses | Accrued expenses consisted of the following (rounded to nearest thousand): June 30, 2016 June 30, 2015 Accrued research and development consulting fees $ 25,000 $ 478,000 Accrued rent (Note 10) – related parties 32,000 42,000 Accrued interest – related parties 40,000 73,000 Total $ 97,000 $ 593,000 |
Accrued Salaries and Payroll 30
Accrued Salaries and Payroll Taxes - Related Parties And Other (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Accrued Salaries And Payroll Taxes - Related Parties And Other Tables | |
Schedule of accrued salaries and payroll taxes | Accrued salaries and payroll taxes consisted of the following (rounded to nearest thousand): June 30, 2016 June 30, 2015 Accrued salaries – related parties $ 2,647,000 $ 2,647,000 Accrued payroll taxes – related parties 130,000 130,000 Withholding tax 57,000 65,000 Total $ 2,834,000 $ 2,842,000 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Commitments And Contingencies Tables | |
Future minimum lease payments required under the non-cancelable operating lease | As of June 30, 2016, future minimum lease payments to Cummings Properties required under the non-cancelable operating lease are as follows (rounded to nearest thousand): Year ending June 30, 2017 $ 214,000 2018 214,000 2019 55,000 Total minimum payments $ 483,000 |
Weighted Average Shares Outst32
Weighted Average Shares Outstanding (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Weighted Average Shares Outstanding Tables | |
Weighted average shares of common stock basic and diluted earnings per share | Weighted average shares of common stock outstanding used in the calculation of basic and diluted earnings per share were as follows: Years Ended June 30, 2016 2015 2014 Weighted average shares outstanding-basic 119,908,145 115,087,368 105,044,985 Dilutive options and restricted stock - - - Weighted average shares outstanding-diluted 119,908,145 115,087,368 105,044,985 Antidilutive securities not included: Options 44,570,736 42,953,318 43,485,670 Warrants 25,000 1,507,000 2,448,000 44,595,736 44,460,318 45,933,670 |
Stock Options and Warrants (Tab
Stock Options and Warrants (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Stock Warrants [Member] | |
Valuation assumptions for stock options/warrants and SARs | Average risk-free interest rate 0.29 % Average expected life- years 2 Expected volatility 55.22 % Expected dividends 0 |
Schedule of stock option activity | The following table summarizes stock warrants: Warrants Weighted Average Exercise Price Weighted Average Remaining Contractual Life (Years) Aggregate Intrinsic Value Outstanding at June 30, 2013 5,571,084 $ 0.92 1.43 $ 4,794,000 Extended 2,223,000 1.00 1.50 Granted 25,000 1.79 2.57 Exercised (3,148,084 ) 1.00 - Expired (2,223,000 ) 1.00 - Outstanding at June 30, 2014 2,448,000 $ 1.01 1.43 $ 1,623,000 Extended - - - Granted - - - Exercised (941,000 ) 0.80 - Expired - - - Outstanding at June 30, 2015 1,507,000 $ 1.14 0.52 $ 2,156,310 Extended - - - Granted - - - Exercised - - - Expired (1,482,000 ) 1.13 - Outstanding at June 30, 2016 25,000 $ 1.79 0.56 $ - Exercisable at June 30, 2016 25,000 $ 1.79 0.56 $ - |
Stock Options [Member] | |
Valuation assumptions for stock options/warrants and SARs | Year Ended June 30 2016 2015 2014 Expected term (in years) 3 - 10 3 3-5 Expected stock price volatility 56.52% to 112.71% 62.79% to 65.84% 91.25%-124.94% Risk-free interest rate 0.88% to 1.74% 0.76% to 1.19% 0.9% – 1.98% Expected dividend yield 0 0 0 |
Schedule of stock option activity | The following table summarizes all stock option activity under the plans: Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Life (Years) Aggregate Intrinsic Value Outstanding at June 30, 2013 39,142,500 $ 0.14 7.47 $ 64,169,000 Granted 40,000 1.64 Exercised (25,000 ) 0.20 Forfeited/expired (150,000 ) 0.23 Outstanding at June 30, 2014 39,007,500 $ 0.14 6.50 $ 59,613,000 Granted 155,000 3.75 Exercised (320,000 ) 0.35 Forfeited/expired (80,000 ) 0.38 Outstanding at June 30, 2015 38,762,500 $ 0.15 5.54 $ 94,217,650 Granted 1,871,228 1.58 Exercised (74,000 ) 0.55 Forfeited/expired (115,000 ) 0.61 Outstanding at June 30, 2016 40,444,728 0.22 4.58 $ 48,185,911 Exercisable at June 30, 2016 39,722,303 $ 0.20 4.50 $ 48,163,220 |
Stock Transactions (Tables)
Stock Transactions (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Notes to Financial Statements | |
Schedule of Restricted Stock Units Award Activity | The following summarizes our restricted stock unit activity for the above restricted stock issuance: Number of Units Weighted Average Grant Date Fair Value Total awards outstanding at June 30, 2015 - $ - Total units vested - Total units non-vested 1,066,667 $ 1.4 Total shares outstanding at June 30, 2016 1,066,667 $ 1.4 |
Schedule of vesting outstanding restricted stock units | Scheduled vesting for outstanding restricted stock units at June 30, 2016 is as follows: Year Ending June 30, 2017 2018 2019 Total Scheduled vesting—restricted stock units 533,333 533,334 - 1,066,667 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Income Taxes Tables | |
Income tax provision benefit | The income tax provision benefit differs from the amount of tax determined by applying the Federal statutory rate as follows: June 30, 2016 June 30, 2015 June 30, 2014 Book income at federal statutory rate 34.00 % 34.00 % 34.00 % State income tax, net of federal tax benefit 5.24 % 5.31 % 5.33 % Change in valuation allowance (41.88 )% (43.43 )% (43.87 )% Research and development credit 6.97 % 8.01 % 7.69 % Permanent difference (3.16 )% (2.72 )% (2.62 )% Others - net (1.17 )% (1.17 )% (0.53 )% Total 0.00 % 0.00 % 0.00 % |
Deferred tax assets | The components of deferred tax assets as of June 30, 2016 and 2015 are as follows ( ) June 30, 2016 June 30, 2015 Deferred tax (liability) asset: Net operating loss carry forwards $ 16,272,000 $ 11,799,000 Accrued payroll 1,105,000 1,105,000 Stock compensation 1,653,000 1,633,000 Research and development credit 2,672,000 1,777,000 Other 162,000 166,000 $ 21,863,000 $ 16,480,000 Valuation allowance (21,863,000 ) (16,480,000 ) Total deferred taxes $ - $ - |
Selected Quarterly Results of36
Selected Quarterly Results of Operations (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Selected Quarterly Results Of Operations Tables | |
Quarterly results of operations | A summary of the CompanyÂ’s quarterly results of operations for the years ended June 30, 2016 and 2015 is as follows ( Years Ended June 30, 2016 Quarter 1 2016 Quarter 2 2016 Quarter 3 2016 Quarter 4 2016 Total 2016 Revenues $ - $ - $ - $ - $ - Gross profit $ - $ - $ - $ - $ - Net loss $ (2,577,000 ) $ (3,323,000 ) $ (3,709,000 ) $ (3,243,000 ) $ (12,852,000 ) Net loss attributable to common stockholders $ (2,577,000 ) $ (3,323,000 ) $ (3,709,000 ) $ (3,243,000 ) $ (12,852,000 ) Loss per share attributable to common stockholders -Basic $ (0.02 ) $ (0.03 ) $ (0.03 ) $ (0.03 ) $ (0.11 ) -Diluted $ (0.02 ) $ (0.03 ) $ (0.03 ) $ (0.03 ) $ (0.11 ) Weighted average number of common shares 118,140,424 118,673,362 120,204,272 122,647,514 119,908,145 Years Ended June 30, 2015 Quarter 1 2015 Quarter 2 2015 Quarter 3 2015 Quarter 4 2015 Total 2015 Revenues $ - $ - $ - $ - $ - Gross profit $ - $ - $ - $ - $ - Net loss $ (4,395,000 ) $ (2,754,000 ) $ (2,895,000 ) $ (3,101,000 ) $ (13,145,000 ) Net loss attributable to common stockholders $ (4,395,000 ) $ (2,754,000 ) $ (2,895,000 ) $ (3,101,000 ) $ (13,145,000 ) Loss per share attributable to common stockholders -Basic $ (0.04 ) $ (0.02 ) $ (0.02 ) $ (0.02 ) $ (0.11 ) -Diluted $ (0.04 ) $ (0.02 ) $ (0.02 ) $ (0.02 ) $ (0.11 ) Weighted average number of common shares 111,121,912 114,716,009 116,885,350 117,693,617 115,087,368 |
Liquidity (Details Textual)
Liquidity (Details Textual) - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||||
Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Liquidity Details Textual | ||||||||||||
Cash and cash equivalents | $ 6,310,000 | $ 8,410,000 | $ 6,310,000 | $ 8,410,000 | $ 4,988,000 | $ 2,955,000 | ||||||
Net loss | (3,243,000) | $ (3,709,000) | $ (3,323,000) | $ (2,577,000) | (3,101,000) | $ (2,895,000) | $ (2,754,000) | $ (4,395,000) | (12,852,000) | (13,145,000) | $ (8,247,000) | |
Working capital (deficit) | (1,800,000) | $ 1,474,000 | (1,800,000) | $ 1,474,000 | ||||||||
Common stock purchase available balance | $ 22,000,000 | $ 22,000,000 |
Significant Accounting Polici38
Significant Accounting Policies and Recent Accounting Pronouncements (Details) - Stock Options [Member] - USD ($) | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Research and development expenses | |||
Consulting fees | $ 188,000 | $ 55,000 | $ 389,000 |
Employees' bonus | 103,000 | ||
Officers' bonus | 33,000 | 230,000 | |
Professional expenses | 432,000 | ||
General and administrative expenses | |||
Directors’ fees | 60,000 | ||
Employees' bonus | 12,000 | 105,000 | |
Consulting fees | 54,000 | ||
Total share-based compensation expense | $ 713,000 | $ 400,000 | $ 548,000 |
Significant Accounting Polici39
Significant Accounting Policies and Recent Accounting Pronouncements (Detail Textual) - USD ($) | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Cash Equivalents | $ 0 | $ 0 | $ 0 |
Property, plant and Equipment useful lives | 5 years | ||
Patent costs - net | $ 4,311,000 | 5,018,000 | |
Amortization expense | 404,000 | 394,000 | 285,000 |
Amount charged to operations | 37,000 | 102,000 | 136,000 |
Impairment expense | 648,000 | 0 | 0 |
Research and development costs | $ 8,952,000 | $ 10,531,000 | $ 6,344,000 |
Description of credit risk | Approximately $6 million is subject to credit risk. | ||
Minimum and Intangible Assets - Patent (Member) | |||
Amortization period | 12 years | ||
Maxiimum and Intangible Assets - Patent (Member) | |||
Amortization period | 17 years |
Polymedix Inc. Asset Acquisit40
Polymedix Inc. Asset Acquisition - Patent Rights and Equipment (Details) | Jun. 30, 2016USD ($) |
Polymedix Inc. Asset Acquisition - Patent Rights And Equipment Details | |
Intangible assets - patents rights - Brilacidin, Delparantag and other related compounds | $ 4,706,000 |
Tangible assets - Laboratory equipment and computer systems | $ 96,000 |
Polymedix Inc. Asset Acquisit41
Polymedix Inc. Asset Acquisition - Patent Rights and Equipment (Details Textuals) | Jun. 30, 2016USD ($) |
Polymedix Inc. Asset Acquisition - Patent Rights And Equipment Details Textuals | |
Carrying value of Purchased Patents Rights | $ 377,000 |
Patents, net (Details)
Patents, net (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Purchased Patent Rights | $ 5,261,000 | $ 5,698,000 |
Patent costs - net | $ 4,311,000 | 5,018,000 |
Patents [Member] | ||
Useful life | 14 years | |
Purchased Patent Rights | $ 4,082,000 | 4,082,000 |
Accumulated amortization | $ (855,000) | (551,000) |
Patents Two [Member] | ||
Useful life | 12 years | |
Purchased Patent Rights | 480,000 | |
Accumulated amortization | (73,000) | |
Patents Three [Member] | ||
Useful life | 12 years | |
Purchased Patent Rights | $ 144,000 | 144,000 |
Patents Four [Member] | ||
Useful life | 17 years | |
Purchased Patent Rights | $ 1,035,000 | 992,000 |
Accumulated amortization | $ (95,000) | $ (56,000) |
Patents, net (Details Textual)
Patents, net (Details Textual) - USD ($) | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Amortization expense | $ 404,000 | $ 394,000 | $ 285,000 |
Impairment of patent costs | 648,000 | ||
Year 2017-2025 [Member] | |||
Estimated annual amortization expense | 361,000 | ||
Year 2026 [Member] | |||
Estimated annual amortization expense | 351,000 | ||
Year 2027 [Member] | |||
Estimated annual amortization expense | 349,000 | ||
Year 2028 [Member] | |||
Estimated annual amortization expense | 111,000 | ||
Year 2029 and 2032 [Member] | |||
Estimated annual amortization expense | 57,000 | ||
Year 2033 [Member] | |||
Estimated annual amortization expense | $ 22,000 | ||
Minimum and Intangible Assets - Patent (Member) | |||
Estimated remaining useful lives of the assets | 12 years | ||
Amortization period | 9 years 2 months 5 days | ||
Maxiimum and Intangible Assets - Patent (Member) | |||
Estimated remaining useful lives of the assets | 17 years | ||
Amortization period | 16 years 4 months 24 days |
Property, plant and equipment44
Property, plant and equipment net (Details) - USD ($) | Jun. 30, 2016 | Jun. 30, 2015 |
Property Plant And Equipment Net Details | ||
Testing equipment | $ 120,000 | $ 52,000 |
Accumulated depreciation | (30,000) | (14,000) |
Property, plant and equipment, net | $ 90,000 | $ 38,000 |
Property, plant and equipment45
Property, plant and equipment net (Details Textual) - USD ($) | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Property Plant And Equipment Net Details Textual | |||
Depreciation expense | $ 16,000 | $ 10,000 | $ 4,000 |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) | Jun. 30, 2016 | Jun. 30, 2015 |
Accrued Expenses Details | ||
Accrued research and development consulting fees | $ 25,000 | $ 478,000 |
Accrued rent (Note 10) – related parties | 32,000 | 42,000 |
Accrued interest - related parties | 40,000 | 73,000 |
Total | $ 97,000 | $ 593,000 |
Accrued Salaries and Payroll 47
Accrued Salaries and Payroll Taxes - Related Parties And Other (Details) - USD ($) | Jun. 30, 2016 | Jun. 30, 2015 |
Accrued Salaries And Payroll Taxes - Related Parties And Other Details | ||
Accrued salaries - related parties | $ 2,647,000 | $ 2,647,000 |
Accrued payroll taxes - related parties | 130,000 | 130,000 |
Withholding tax | 57,000 | 65,000 |
Total | $ 2,834,000 | $ 2,842,000 |
Commitments and Contingencies48
Commitments and Contingencies (Details) | Jun. 30, 2016USD ($) |
Year ending June 30, | |
2,017 | $ 214,000 |
2,018 | 214,000 |
2,019 | 55,000 |
Total minimum payments | $ 483,000 |
Commitments and Contingencies49
Commitments and Contingencies (Details Textual) - USD ($) | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Commitments And Contingencies Details Textual | |||
Operating leases, rental expense | $ 203,000 | $ 207,000 | $ 162,000 |
Related Party Transactions (Det
Related Party Transactions (Details Textual) - USD ($) | 12 Months Ended | 34 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2016 | |
Kard Scientific [Member] | ||||
Rent expense | $ 0 | $ 0 | $ 10,800 | |
Rent payables included in accrued expenses | 32,000 | 42,000 | $ 32,000 | |
Clinical Studies [Member] | ||||
Accrued research and development expenses | $ 1,486,000 | $ 1,686,000 | 1,486,000 | |
Cellceutix [Member] | ||||
Rent expense | $ 31,000 |
Note Payable - Related Party (D
Note Payable - Related Party (Details Textual) - USD ($) | Jun. 30, 2016 | Jun. 30, 2015 |
Note Payable - Related Party Details Textual | ||
Interest accrued | $ 40,000 | $ 73,000 |
Principal balances of the demand note | $ 2,022,000 | $ 2,022,000 |
Weighted Average Shares Outst52
Weighted Average Shares Outstanding (Details) - shares | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Weighted Average Shares Outstanding Details | |||
Weighted average shares outstanding-basic | 119,908,145 | 115,087,368 | 105,044,985 |
Dilutive options and restricted stock | |||
Weighted average shares outstanding-diluted | 119,908,145 | 115,087,368 | 105,044,985 |
Antidilutive securities not included: | |||
Options | 44,570,736 | 42,953,318 | 43,485,670 |
Warrants | 25,000 | 1,507,000 | 2,448,000 |
Antidilutive securities excluded from computation of earnings per share | 44,595,736 | 44,460,318 | 45,933,670 |
Stock Options and Warrants (Det
Stock Options and Warrants (Details) - Stock Options [Member] | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Expected term (in years) | 3 years | ||
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Minimum [Member] | |||
Expected term (in years) | 3 years | 3 years | |
Expected stock price volatility | 56.52% | 62.79% | 91.25% |
Risk-free interest rate | 0.88% | 0.76% | 0.90% |
Maximum [Member] | |||
Expected term (in years) | 10 years | 5 years | |
Expected stock price volatility | 112.71% | 65.84% | 124.94% |
Risk-free interest rate | 1.74% | 1.19% | 1.98% |
Stock Options and Warrants (D54
Stock Options and Warrants (Details 1) - Stock Options [Member] - USD ($) | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Number of Outstanding, Beginning Balance | 38,762,500 | 39,007,500 | 39,142,500 |
Granted | 1,871,228 | 155,000 | 40,000 |
Exercised | (74,000) | (320,000) | (25,000) |
Forfeited/expired | (115,000) | (80,000) | (150,000) |
Number of Outstanding, Ending Balance | 40,444,728 | 38,762,500 | 39,007,500 |
Number of Outstanding, Exercisable | 39,722,303 | ||
Weighted Average Exercise Price, Beginning Balance | $ 0.15 | $ 0.14 | $ 0.14 |
Granted | 1.58 | 3.75 | 1.64 |
Exercised | 0.55 | 0.35 | 0.20 |
Forfeited/expired | 0.61 | 0.38 | 0.23 |
Weighted Average Exercise Price, Ending Balance | 0.22 | $ 0.15 | $ 0.14 |
Weighted Average Exercise Price, Exercisable | $ 0.20 | ||
Weighted average remaining contractual life (Years), Outstanding, Beginning Balance | 5 years 6 months 15 days | 6 years 6 months | 7 years 5 months 19 days |
Weighted average remaining contractual life (Years), Outstanding, Ending Balance | 4 years 6 months 29 days | 5 years 6 months 15 days | 6 years 6 months |
Weighted average remaining contractual life (Years), Exercisable | 4 years 6 months | ||
Aggregate intrinsic value, Beginning Balance | $ 94,217,650 | $ 59,613,000 | $ 64,169,000 |
Aggregate intrinsic value, Ending Balance | 48,185,911 | $ 94,217,650 | $ 59,613,000 |
Aggregate intrinsic value, Exercisable | $ 48,163,220 |
Stock Options and Warrants (D55
Stock Options and Warrants (Details 2) - Stock Warrants [Member] | 12 Months Ended |
Jun. 30, 2016 | |
Average risk-free interest rate | 0.29% |
Average expected life- years | 2 years |
Expected volatility | 55.22% |
Expected dividends | 0.00% |
Stock Options and Warrants (D56
Stock Options and Warrants (Details 3) - Stock Warrants [Member] - USD ($) | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Number of Outstanding, Beginning Balance | 1,507,000 | 2,448,000 | 5,571,084 |
Extended | 2,223,000 | ||
Granted | 25,000 | ||
Exercised | (941,000) | (3,148,084) | |
Forfeited/expired | (1,482,000) | (2,223,000) | |
Number of Outstanding, Ending Balance | 25,000 | 1,507,000 | 2,448,000 |
Number of Outstanding, Exercisable | 25,000 | ||
Weighted Average Exercise Price, Beginning Balance | $ 1.14 | $ 1.01 | $ 0.92 |
Extended | 1 | ||
Granted | 1.79 | ||
Exercised | 0.80 | 1 | |
Forfeited/expired | 1.13 | 1 | |
Weighted Average Exercise Price, Ending Balance | 1.79 | $ 1.14 | $ 1.01 |
Weighted Average Exercise Price, Exercisable | $ 1.79 | ||
Weighted average remaining contractual life (Years), Outstanding, Beginning Balance | 6 months 7 days | 1 year 5 months 5 days | 1 year 5 months 5 days |
Weighted average remaining contractual life (Years), Extended | 1 year 6 months | ||
Weighted average remaining contractual life (Years), Granted | 2 years 6 months 26 days | ||
Weighted average remaining contractual life (Years), Outstanding, Ending Balance | 6 months 22 days | 6 months 7 days | 1 year 5 months 5 days |
Weighted average remaining contractual life (Years), Exercisable | 6 months 22 days | ||
Aggregate intrinsic value, Beginning Balance | $ 2,156,310 | $ 1,623,000 | $ 4,794,000 |
Aggregate intrinsic value, Ending Balance | $ 2,156,310 | $ 1,623,000 | |
Aggregate intrinsic value, Exercisable |
Stock Options and Warrants (D57
Stock Options and Warrants (Details Textual) - USD ($) | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Professional fees expense | $ 1,228,000 | $ 447,000 | $ 317,000 |
Stock option expenses | 5,000 | ||
Proceed from stock option exercise | 28,000 | 855,000 | 2,705,000 |
Subscription receivable | $ 26,000 | 12,000 | |
Common stock issued during period, value | 5,618,000 | ||
Stock Warrants [Member] | |||
Exercised | |||
Warrants expired | 1,482,000 | ||
Common stock, shares issued during period | 0 | ||
Common stock issued during period, value | 2,300,000 | ||
Stock Options [Member] | |||
Professional fees expense | $ 55,000 | 389,000 | |
Stock based compensation | 713,000 | 400,000 | 548,000 |
Proceed from stock option exercise | 28,000 | 99,600 | $ 5,000 |
Subscription receivable | $ 12,400 | $ 12,400 | |
Exercised | 15,470 | 320,000 | 25,000 |
Exercise price | $ 0.20 | ||
Stock Options [Member] | Minimum [Member] | |||
Exercise price | $ 0.17 | $ 0.20 | |
Stock Options [Member] | Maximum [Member] | |||
Exercise price | $ 0.25 | $ 0.47 | |
On July 10, 2015 [Member] | |||
Stock option expenses | $ 60,000 | ||
On November 5, 2015 [Member] | |||
Stock option expenses | 432,000 | ||
On February 16, 2016 [Member] | |||
Stock option expenses | 39,000 | ||
On April 6, 2016 [Member] | |||
Stock option expenses | 3,000 | ||
On June 10, 2016 [Member] | |||
Stock option expenses | 60,000 | ||
Consulting Agreement [Member] | |||
Professional fees expense | $ 0 | $ 0 | $ 54,000 |
Stock Transactions (Details)
Stock Transactions (Details) - Restricted Stock [Member] | 12 Months Ended |
Jun. 30, 2016$ / sharesshares | |
Number of Outstanding, Beginning Balance | shares | |
Total units vested | shares | |
Total units non-vested | shares | 1,066,667 |
Number of Outstanding, Ending Balance | shares | 1,066,667 |
Weighted Average Exercise Price, Beginning Balance | $ / shares | |
Total units vested | $ / shares | |
Total units non-vested | $ / shares | 1.4 |
Weighted Average Exercise Price, Ending Balance | $ / shares | $ 1.4 |
Stock Transactions (Details 1)
Stock Transactions (Details 1) - shares | 12 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Restricted Stock [Member] | ||||
Scheduled vesting - restricted stock units | 533,334 | 533,333 | 1,066,667 |
Stock Transactions (Details Tex
Stock Transactions (Details Textual) - USD ($) | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Deferred offering costs | $ 358,000 | $ 494,000 | |
Proceed from stock option exercise | 28,000 | 855,000 | $ 2,705,000 |
Unrecognized compensation | 1,490,000 | ||
Exercise of Common Stock Options [Member] | |||
Cash received | 15,000 | ||
Proceed from stock option exercise | $ 25,400 | $ 112,000 | |
Options exercised | 74,000 | 320,000 | |
Exercise of Common Stock Options [Member] | Minimum [Member] | |||
Exercise price | $ 0.42 | $ 0.20 | |
Exercise of Common Stock Options [Member] | Maximum [Member] | |||
Exercise price | $ 1.11 | $ 0.45 | |
20 Million Common Stock Purchase Agreement [Member] | Aspire Capital Fund Llc [Member] | Common Class A | |||
Deferred offering costs | 295,000 | ||
Amount available under the financing arrangement | 15,800,000 | ||
Employment Agreement [Member] | |||
Stock based compensation | $ 8,000 | ||
Common Class A | |||
Common stock, shares issued | 123,589,536 | 117,763,508 | |
Common Stock, Value | $ 12,000 | $ 12,000 | |
Common stock, par value | $ 0.0001 | $ 0.0001 | |
Common Class A | 20 Million Common Stock Purchase Agreement [Member] | Aspire Capital Fund Llc [Member] | |||
Amortization amount | $ 295,000 | 77,000 | |
Commitment fee | $ 373,000 | ||
Common Class A | 30 Million Common Stock Purchase Agreement [Member] | Aspire Capital Fund Llc [Member] | |||
Number of common stock shares sold | 5,700,000 | ||
Value of common stock shares sold | $ 8,200,000 | ||
Amortization amount | 136,000 | 5,000 | |
Deferred offering costs | $ 358,000 | 494,000 | |
Common Class A | 10 Million Common Stock Purchase Agreement [Member] | Aspire Capital Fund Llc [Member] | |||
Number of common stock shares sold | 3,204,537 | ||
Value of common stock shares sold | $ 10,000,000 | ||
Common Class A | Common Stock Purchase Agreement Warrants [Member] | |||
Common stock, par value | $ 0.0001 | ||
Common stock, shares issued during period | 2,300,000 | ||
Common stock purchase warrant exercisable price | $ 1 | ||
Restricted Class A Common Stock [Member] | Consultant [Member] | |||
Stock based compensation | 55,000 | ||
Common Stock, Value | $ 38,400 |
Income Taxes (Details)
Income Taxes (Details) | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Income Taxes Details | |||
Book income at federal statutory rate | 34.00% | 34.00% | 34.00% |
State income tax, net of federal tax benefit | 5.24% | 5.31% | 5.33% |
Change in valuation allowance | (41.88%) | (43.43%) | (43.87%) |
Research and development credit | 6.97% | 8.01% | 7.69% |
Permanent difference | (3.16%) | (2.72%) | (2.62%) |
Others - net | (1.17%) | (1.17%) | (0.53%) |
Total | 0.00% | 0.00% | 0.00% |
Income Taxes (Details 1)
Income Taxes (Details 1) - USD ($) | Jun. 30, 2016 | Jun. 30, 2015 |
Deferred tax (liability) asset: | ||
Net operating loss carry forwards | $ 16,272,000 | $ 11,799,000 |
Accrued payroll | 1,105,000 | 1,105,000 |
Stock compensation | 1,653,000 | 1,633,000 |
Research and development credit | 2,672,000 | 1,777,000 |
Other | 162,000 | 166,000 |
Deferred tax assets, Total | 21,863,000 | 16,480,000 |
Valuation allowance | (21,863,000) | (16,480,000) |
Total deferred taxes |
Income Taxes (Detail Textuals)
Income Taxes (Detail Textuals) - USD ($) | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Income Taxes Detail Textuals | |||
Operating loss carryforward | $ 40,909,000 | ||
Operating loss carryforward expire beginning | 2,028 | ||
Amount of change in Valuation allowance | $ 5,383,000 | $ 5,709,000 | $ 3,619,000 |
Selected Quarterly Results of64
Selected Quarterly Results of Operations (unaudited) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Notes to Financial Statements | |||||||||||
Revenues | |||||||||||
Gross profit | |||||||||||
Net loss | (3,243,000) | (3,709,000) | (3,323,000) | (2,577,000) | (3,101,000) | (2,895,000) | (2,754,000) | (4,395,000) | (12,852,000) | (13,145,000) | (8,247,000) |
Net loss attributable to common stockholders | $ (3,243,000) | $ (3,709,000) | $ (3,323,000) | $ (2,577,000) | $ (3,101,000) | $ (2,895,000) | $ (2,754,000) | $ (4,395,000) | $ (12,852,000) | $ (13,145,000) | $ (10,227,000) |
Loss per share attributable to common stockholders -Basic | $ (0.03) | $ (0.03) | $ (0.03) | $ (0.02) | $ (0.02) | $ (0.02) | $ (0.02) | $ (0.04) | $ (0.11) | $ (0.11) | |
Loss per share attributable to common stockholders -Diluted | $ (0.03) | $ (0.03) | $ (0.03) | $ (0.02) | $ (0.02) | $ (0.02) | $ (0.02) | $ (0.04) | $ (0.11) | $ (0.11) | |
Weighted average number of common shares | 122,647,514 | 120,204,272 | 118,673,362 | 118,140,424 | 117,693,617 | 116,885,350 | 114,716,009 | 111,121,912 | 119,908,145 | 115,087,368 | 105,044,985 |