Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Dec. 31, 2016 | Jan. 27, 2017 | |
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-Q | |
Document Period End Date | Dec. 31, 2016 | |
Entity Current Reporting Status | Yes | |
Entity Voluntary Filers | No | |
Entity Well-known Seasoned Issuer | No | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q2 | |
Entity Common Stock, Shares Outstanding | 126,408,756 |
CONDENSED BALANCE SHEETS
CONDENSED BALANCE SHEETS - USD ($) | Dec. 31, 2016 | Jun. 30, 2016 |
Current Assets: | ||
Cash | $ 3,859,000 | $ 6,310,000 |
Prepaid expenses | 199,000 | 272,000 |
Subscription receivable | 26,000 | 26,000 |
Total Current Assets | 4,084,000 | 6,608,000 |
Other Assets: | ||
Patent costs - net | 4,181,000 | 4,311,000 |
Property, plant and equipment -net | 139,000 | 90,000 |
Deferred offering costs | 310,000 | 358,000 |
Security deposits | 78,000 | 78,000 |
Total Other Assets | 4,708,000 | 4,837,000 |
Total Assets | 8,792,000 | 11,445,000 |
Current Liabilities: | ||
Accounts payable - (including related party payables of approx. $1,504,000 and $1,502,000, respectively) | 3,223,000 | 3,528,000 |
Accrued expenses - (including related party accruals of approx. $139,000 and $72,000, respectively) | 549,000 | 97,000 |
Accrued salaries and payroll taxes -(including related party accrued salaries of approx. $2,777,000 and $2,777,000, respectively) | 2,862,000 | 2,834,000 |
Note payable - related party | 2,022,000 | 2,022,000 |
Total Current Liabilities | 8,656,000 | 8,481,000 |
Total Liabilities | 8,656,000 | 8,481,000 |
Commitments and contingencies (Note 8) | ||
Stockholders' Equity | ||
Preferred stock, $0.001 par value, 500,000 designated shares, no shares issued and outstanding | ||
Additional paid-in capital | 60,526,000 | 56,969,000 |
Accumulated deficit | (60,403,000) | (54,017,000) |
Total Stockholders' Equity | 136,000 | 2,964,000 |
Total Liabilities and Stockholders' Equity | 8,792,000 | 11,445,000 |
Common Class A | ||
Stockholders' Equity | ||
Common Stock, Value | 13,000 | 12,000 |
Common Class B | ||
Stockholders' Equity | ||
Common Stock, Value |
CONDENSED BALANCE SHEETS (Paren
CONDENSED BALANCE SHEETS (Parenthetical) - USD ($) | Dec. 31, 2016 | Jun. 30, 2016 |
Current Liabilities: | ||
Accounts payable, related party payables (in dollars) | $ 1,504,000 | $ 1,502,000 |
Accrued expenses, related party accruals (in dollars) | 139,000 | 72,000 |
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) | 126,008,756 | 123,589,536 |
Common Stock, shares outstanding (in shares) | 126,008,756 | 123,589,536 |
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 |
CONDENSED STATEMENTS OF OPERATI
CONDENSED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | |
Condensed Statements Of Operations | ||||
Revenues | ||||
Operating expenses: | ||||
Research and development expenses | 2,683,000 | 2,130,000 | 4,960,000 | 3,961,000 |
General and administrative expenses | 344,000 | 352,000 | 706,000 | 691,000 |
Officers' payroll and payroll tax expenses | 130,000 | 130,000 | 260,000 | 260,000 |
Professional fees | 152,000 | 662,000 | 361,000 | 889,000 |
Total operating expenses | 3,309,000 | 3,274,000 | 6,287,000 | 5,801,000 |
Loss from operations | (3,309,000) | (3,274,000) | (6,287,000) | (5,801,000) |
Other income (expenses) | ||||
Interest income | 1,000 | 1,000 | 2,000 | 2,000 |
Interest expense | (50,000) | (50,000) | (101,000) | (101,000) |
Total other income (expenses) | (49,000) | (49,000) | (99,000) | (99,000) |
Loss before provision for income taxes | (3,358,000) | (3,223,000) | (6,386,000) | (5,900,000) |
Provision for income taxes | ||||
Net loss | $ (3,358,000) | $ (3,223,000) | $ (6,386,000) | $ (5,900,000) |
Basic and diluted loss per share attributable to common stockholders | $ (0.03) | $ (0.03) | $ (0.05) | $ (0.05) |
Weighted average number of common shares outstanding | 125,275,060 | 118,673,362 | 124,782,071 | 118,406,893 |
CONDENSED STATEMENTS OF CASH FL
CONDENSED STATEMENTS OF CASH FLOW (Unaudited) - USD ($) | 6 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (6,386,000) | $ (5,900,000) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Common stock and stock options issued as payment for services | 690,000 | 530,000 |
Amortization of patent costs | 183,000 | 204,000 |
Depreciation of equipment | 15,000 | 5,000 |
Changes in operating assets and liabilities: | ||
Prepaid expenses and other current assets | 73,000 | 172,000 |
Accounts payable | (305,000) | 259,000 |
Accrued expenses | 452,000 | 93,000 |
Accrued officers' salaries and payroll taxes | 28,000 | (3,000) |
Net cash used in operating activities | (5,250,000) | (4,640,000) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Additions to property, plant and equipment | (64,000) | |
Patent costs | (53,000) | (217,000) |
Net cash used in investing activities | (117,000) | (217,000) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Sale of common stock | 2,916,000 | 2,618,000 |
Exercise of stock options and warrants | 12,000 | |
Net cash provided by financing activities | 2,916,000 | 2,630,000 |
NET DECREASE IN CASH | (2,451,000) | (2,227,000) |
CASH, BEGINNING OF PERIOD | 6,310,000 | 8,410,000 |
CASH, END OF PERIOD | 3,859,000 | 6,183,000 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | ||
Cash paid for interest | $ 29,000 | $ 29,000 |
Basis of Presentation and Natur
Basis of Presentation and Nature of Operations | 6 Months Ended |
Dec. 31, 2016 | |
Notes to Financial Statements | |
Note 1 - Basis of Presentation and Nature of Operations | Unaudited Interim Financial Information The accompanying unaudited condensed financial statements of Cellceutix Corporation have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission, or the SEC, including the instructions to Form 10-Q and Regulation S-X. Certain information and note disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America have been condensed or omitted from these statements pursuant to such rules and regulations and, accordingly, they do not include all the information and notes necessary for comprehensive financial statements and should be read in conjunction with our audited financial statements for the year ended June 30, 2016, included in our Annual Report on Form 10-K for the year ended June 30, 2016. In the opinion of the management of the Company, all adjustments, which are of a normal recurring nature, necessary for a fair statement of the results for the three month and six month periods have been made. Results for the interim period presented are not necessarily indicative of the results that might be expected for the entire fiscal year. When used in these notes, the terms "Company", "we", "us" or "our" mean Cellceutix Corporation. Basis of Presentation Cellceutix Corporation 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. The Companys 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 | 6 Months Ended |
Dec. 31, 2016 | |
Notes to Financial Statements | |
Note 2 - Liquidity | At December 31, 2016, we had $3.9 million in cash. We have expended substantial funds on the research and development of our product candidates. Our net losses incurred for the six months ended December 31, 2016 and 2015, amounted to $6.4 million and $5.9 million, respectively, and we had a working capital deficit of approximately $4.6 million and $1.9 million, respectively at December 31, 2016 and June 30, 2016. 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 December 31, 2016, the available balance is approximately $19 million under this stock purchase agreement. 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 Capital and under the Companys effective shelf registration statement will be sufficient to fund the Companys 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 | 6 Months Ended |
Dec. 31, 2016 | |
Notes to Financial Statements | |
Note 3 - Significant Accounting Policies and Recent Accounting Pronouncements | Reclassifications Certain prior year amounts have been reclassified to conform to current period presentation. Such reclassifications were limited to the Condensed Balance Sheets and did not impact the Condensed Statement of Operations and Condensed Statement of Cash Flows. Use of Estimates The preparation of 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 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. Basic Earnings (Loss) per Share Basic and diluted earnings (loss) 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 of 45.1 million shares and 44.0 million shares were excluded from the computation of diluted earnings (loss) per share for the three months and six months ended December 31, 2016 and 2015, respectively, because their effect is anti-dilutive. 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 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 counterpartys 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 is 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 vesting method over the requisite service period of the equity awards. The components of stock based compensation related to stock options and stock awards in the Companys Statement of Operations for the three months and six months ended December 31, 2016 and 2015 are as follows (rounded to nearest thousand): Three Months Ended Six Months Ended December 31, December 31, 2016 2015 2016 2015 General and administrative expenses Professional fees $ - $ 432,000 $ - $ 432,000 Research and development expenses Professional fees $ 8,000 $ - $ 50,000 $ 78,000 Employees bonus 50,000 - 62,000 - Officers bonus 289,000 - 578,000 20,000 Total share-based compensation expense $ 347,000 $ 432,000 $ 690,000 $ 530,000 Recent Accounting Pronouncements Standards Issued Not Yet Adopted In August 2014, the FASB issued ASU 2014-15, Presentation of Financial StatementsGoing ConcernDisclosure of Uncertainties about an Entitys Ability to Continue as a Going Concern (ASU 2014-15). ASU 2014-15 requires management to assess an entitys 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 Companys first quarter of fiscal 2018. Management believes that the adoption of this guidance will not have a material impact on our 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 fiscal year 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. Management believes that the adoption of this guidance will not have a material impact on our 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 has been continuously assessing the impact of this guidance. In March 2016, the FASB issued ASU 2016-09, Compensation-Stock Compensation (ASU 2016-09). Under ASU 2016-09, entities will be required to recognize the income tax effects of awards in the income statement when the awards vest or are settled. The guidance on employers accounting for an employees use of shares to satisfy the employers statutory income tax withholding obligation and for forfeitures is also changing. For public business entities, ASU 2016-09 is effective for fiscal years beginning after December 15, 2016, and interim periods within those years. Early adoption is permitted, but all of the guidance must be adopted in the same period. Management believes that the adoption of this guidance will not have a material impact on our financial statements. Standards Issued and Adopted 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 has adopted this guidance and it did not have a material impact on our condensed financial statements. |
Patents, net
Patents, net | 6 Months Ended |
Dec. 31, 2016 | |
Notes to Financial Statements | |
Note 4 - Patents, net | Patents, net consisted of the following (rounded to nearest thousand): Useful life (years) December 31, 2016 June 30, 2016 Purchased Patent Rights Brilacidin, and related compounds 14 $ 4,082,000 $ 4,082,000 Purchased Patent Rights Anti-microbial surfactants and related compounds 12 144,000 144,000 Patents Kevetrin and related compounds 17 1,088,000 1,035,000 5,314,000 5,261,000 Less: Accumulated amortization for Brilacidin, Anti-microbial- surfactants and related compounds (1,007,000 ) (855,000 ) Accumulated amortization for Patents Kevetrin and related compounds (126,000 ) (95,000 ) $ 4,181,000 $ 4,311,000 The patents are amortized on a straight-line basis over the estimated remaining useful lives of the assets, determined to be 12-17 years from the date of acquisition. Amortization expense was approximately $92,000 and $107,000, for the three months ended December 31, 2016 and 2015, respectively and was approximately $183,000, and $204,000 for the six months ended December 31, 2016 and 2015, respectively. As of December 31, 2016, the future amortization period for all patents was approximately 9 years to 16 years. Future estimated annual amortization expenses are approximately $181,000 for 2017, $364,000 for each year from 2018 to 2025, $354,000 for the year ending June 30, 2026, $352,000 for the year ending June 30, 2027, $114,000 for the year ending June 30, 2028, $61,000 for the years ending June 30, 2029 to 2032, $24,000 for year ending June 30, 2033 and $1,000 for year ending June 30, 2034. |
Accounts Payable
Accounts Payable | 6 Months Ended |
Dec. 31, 2016 | |
Notes to Financial Statements | |
Note 5 - Accounts Payable | Accounts payable consisted of the following (rounded to nearest thousand): December 31, 2016 June 30, 2016 Accounts payable $ 1,719,000 $ 2,026,000 Accounts payable (Note 9) related parties 1,504,000 1,502,000 Total $ 3,223,000 $ 3,528,000 During the second quarter of fiscal year 2017, the Company realized that it had improperly estimated that it owed research and development related expenses resulting from invoices under a specific research vendor contract for upfront start-up fees, amounting to $593,000. Changes in the estimated research and development expenses are accounted for in the current period. As a result, in the second quarter of fiscal 2017, the Company recorded $593,000 into income relating to the reversal of this accounts payable that was recorded as of June 30, 2016. The Company believes that the amounts recorded were not material to the Company's consolidated results of operations or consolidated financial position. |
Accrued Expenses
Accrued Expenses | 6 Months Ended |
Dec. 31, 2016 | |
Notes to Financial Statements | |
Note 6 - Accrued Expenses | Accrued expenses consisted of the following (rounded to nearest thousand): December 31, 2016 June 30, 2016 Accrued research and development consulting fees $ 411,000 $ 25,000 Accrued rent (Note 9) related party 26,000 32,000 Accrued interest (Note 10) related party 112,000 40,000 Total $ 549,000 $ 97,000 |
Accrued Salaries and Payroll Ta
Accrued Salaries and Payroll Taxes - Related Parties And Other | 6 Months Ended |
Dec. 31, 2016 | |
Notes to Financial Statements | |
Note 7 - Accrued Salaries and Payroll Taxes - Related Parties And Other | Accrued salaries and payroll taxes consisted of the following (rounded to nearest thousand): December 31, 2016 June 30, 2016 Accrued salaries related parties $ 2,647,000 $ 2,647,000 Accrued payroll taxes related parties 130,000 130,000 Withholding tax 85,000 57,000 Total $ 2,862,000 $ 2,834,000 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Dec. 31, 2016 | |
Notes to Financial Statements | |
Note 8 - 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 approximately $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 subleases 200 square feet of space previously used by the Company and pay the Company $900 per month. As of December 31, 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 109,000 2018 217,000 2019 54,000 Total minimum payments $ 380,000 Rent expense, net of lease income, under this operating lease agreement was approximately $51,000 and $50,000, for the three months ended December 31, 2016 and 2015, respectively and was approximately $102,000 and $101,000 for the six months ended December 31, 2016 and 2015, respectively. Contractual Commitments The Company has no contractual minimum commitments to contract research organizations as of December 31, 2016. Services are billed to Cellceutix when performed by the vendors. |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Dec. 31, 2016 | |
Notes to Financial Statements | |
Note 9 - Related Party Transactions | Office Lease Dr. Menon, one of the Companys principal shareholders, President of Research 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 or pays rent to KARD. In September 2013, the Company signed a lease extension agreement with Cummings Properties for the Companys 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 and directors of Cellecutix, has co-signed the lease and rents approximately 200 square feet of office space, the space previously used by Cellceutix and pays Cellceutix $900 per month, the same amount Cellceutix previously paid KARD. Innovative Medical paid total rent of approximately $3,000 and $6,000 to Cellceutix for both of the three months and six months ended December 31, 2016 and 2015, respectively, and the rental payment was offset with the accrued rent owed to KARD. At December 31, 2016 and June 30, 2016, rent payable to KARD of approximately $26,000 and $32,000, respectively, were included in accrued rent related party. Clinical Studies The Company previously engaged KARD to conduct specified pre-clinical studies. The Company did not have an exclusive arrangement with KARD. The Company no longer uses KARD. As of December 31, 2016 and June 30, 2016, the accrued research and development expenses to KARD was approximately $1,486,000 and this amount was included in accounts payable. |
Note Payable-Related Party
Note Payable-Related Party | 6 Months Ended |
Dec. 31, 2016 | |
Notes to Financial Statements | |
Note 10 - 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. The options are valid for ten years from the date of issuance. As of December 31, 2016 and June 30, 2016, approximately $112,000 and $40,000, respectively, was accrued as interest expense on this note. As of December 31, 2016 and June 30, 2016, principal balances of the demand note was approximately $2,022,000. |
Equity Incentive Plans, Stock-B
Equity Incentive Plans, Stock-Based Compensation and Warrants | 6 Months Ended |
Dec. 31, 2016 | |
Notes to Financial Statements | |
Note 11 - Equity Incentive Plans, Stock-Based Compensation and Warrants | Equity Incentive Plans 2009 Stock Option Plan On April 5, 2009 the Board of Directors of the Company adopted the 2009 Stock Option Plan (the 2009 Plan). The 2009 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 "2010 Plan") adopted by the Board of Directors in December 2010, the total number of shares of common stock reserved and available for issuance under the 2010 Plan is 45,000,000 shares. Shares of common stock under the 2010 Plan may consist, in whole or in part, of authorized and unissued shares or treasury shares. The term of each stock option shall be fixed as provided, however, an ISO may be granted only within the ten-year period commencing from the effective date of the 2010 Plan and may only be exercised within ten years of the date of grant (or five years in the case of an ISO 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). 2016 Equity Incentive Plan On June 30, 2016, the Board of Directors adopted the Cellceutix Corporation 2016 Equity Incentive Plan (the "2016 Plan"). The 2016 Plan became effective upon adoption by the Board of Directors on June 30, 2016. Up to 20,000,000 shares of the Company's common stock may be issued under the 2016 Plan (subject to adjustment as described in the 2016 Plan); provided that, no Outside Director (as defined in the 2016 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 2016 Plan permits the grant of ISOs, 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 2016 Plan, the Board of Directors also approved 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 2016 Plan. The following table summarizes all stock option activity under the above equity incentive plans: Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Life (Years) Aggregate Intrinsic Value Outstanding at June 30, 2016 40,444,728 $ 0.22 4.58 $ 48,185,911 Granted 368,779 1.31 9.55 - Exercised - - - - Forfeited/expired - - - - Outstanding at December 31, 2016 40,813,507 $ 0.23 4.13 $ 39,336,598 Exercisable at December 31, 2016 39,769,611 $ 0.20 4.00 $ 39,334,409 The fair value of options granted for the six months ended December 31, 2016 and 2015 was estimated on the date of grant using the Black Scholes model that uses assumptions noted in the following table. Six Months Ended December 31, 2016 2015 Expected term (in years) 3 - 10 3 Expected stock price volatility 57.63% to 111.62% 56.52% to 65.76% Risk-free interest rate 0.71% to 1.73% 1.04% to 1.16% Expected dividend yield 0 0 Stock-Based Compensation The Company recognized approximately $347,000 and $432,000 of total stock-based compensation costs related to stock and stock options awards for the three months ended December 31, 2016 and 2015, respectively. The Company recognized approximately $690,000 and $530,000 of total stock-based compensation costs related to stock and stock options awards for the six months ended December 31, 2016 and 2015, respectively. The $690,000 of total stock-based compensation expense for the six months ended December 31, 2016 included approximately $272,000 of stock options expense and $418,000 of stock awards (see Note 12). For the six months ended December 31, 2016 On February 16, 2016, the Company issued 119,424 stock options to purchase shares of the Companys 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 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 $5,000 and $14,000 of stock options expense during the three months and six months ended December 31, 2016, respectively. On April 6, 2016, the Company issued 25,000 shares and 25,000 stock options to purchase shares of the Companys common stock, par value $0.0001 per share to a consultant for service. The stock options were 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 and $6,000 of stock option expenses for the three months and six months ended December 31, 2016, respectively. The value of these 25,000 shares at $1.61 per share was approximately $40,250. On June 27, 2016, the Company and Dr. Bertolino entered into an executive employment agreement as our President and Chief Medical Officer, 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 Companys 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 Companys common stock on a national securities exchange (e.g. Nasdaq or the NYSE); or (5) upon a Change in Control (as defined in the employment agreement) of the Company. The Company could not conclude that it was probable that these awards will fully vest until the second anniversary of the effective date, because such events listed above are outside the Companys control. The Company will evaluate the probability of these events occurring for each reporting period. The 1,066,667 shares were valued at approximately $1.5 million, which will be amortized over two years to June 27, 2018. The 617,839 stock options were valued at approximately $800,000 and will be exercisable for 10 years at an exercise price of $1.39 per share. They will be amortized over 2 years to June 27, 2018 or sooner if the Company determines that it is probable that one of the events listed above will occur. During the three months and six months ended December 31, 2016, the Company recorded approximately $289,000 and $578,000 of total stock-based compensation, respectively. The $289,000 of stock based compensation expense for the three months ended December 31, 2016 included approximately $101,000 of stock option expense and $188,000 of stock awards. The $578,000 of stock based compensation expense for the six months ended December 31, 2016 included approximately $202,000 of stock option expense and $376,000 of stock awards. 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 $1.1 million stock-based compensation expense if there are conditions which will accelerate the vesting, as mentioned above. At December 31, 2016, it was determined by management that is was not probable that these accelerated vesting conditions would occur and therefore there was no accrual recorded for the contingent acceleration of this stock-based compensation expense. On July 18, 2016, the Company issued 7,500 stock options to purchase shares of the Companys 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 options was approximately $4,000. During the three months and six months ended December 31, 2016, the Company recorded approximately $0 and $4,000 of total stock option expense, respectively. On September 1, 2016, the Company and Jane Harness entered into an executive employment agreement as the Companys VP, Clinical Sciences and Project Management, effective on September 1, 2016. Commencing on September 1, 2016, the Company agreed to pay Ms. Harness an annual salary of $250,000. In addition, the Company agreed to grant to Ms. Harness under the Cellceutix Corporation 2016 Equity Incentive Plan (i) 58,394 shares of restricted stock, which shall vest upon the earliest to occur of the following: (1) one third (33 1/3 %) upon the first anniversary of the effective date, one third (33 1/3 %) upon the second anniversary of the effective date, and the remaining one third (33 1/3 %) upon the third anniversary of the effective date; or (2) upon a Change in Control (as defined in the employment agreement) of the Company. Ten-year options to purchase 172,987 shares of the Companys common stock were also granted at an exercise price of $1.37 per share, which shall vest upon the earliest to occur of the following: (1) one third (33 1/3 %) upon the first anniversary of the effective date, and the remaining balance vesting monthly in equal portions over the following 24 months; and (2) upon a Change in Control (as defined in the employment agreement) of the Company. The 58,394 shares were valued at approximately $80,000, which will be amortized over three years to September 1, 2019. The 172,987 stock options were valued at approximately $220,000 and will be exercisable for 10 years at an exercise price of $1.26 per share. They will be amortized over 3 years to September 1, 2019. During the three months and six months ended December 31, 2016, the Company recorded approximately $25,000 and $33,000 of total stock-based compensation, respectively. The $25,000 of stock based compensation expense for the three months ended December 31, 2016 included approximately $18,000 of stock option expense and $7,000 of stock awards. The $33,000 of stock based compensation expense for the six months ended December 31, 2016 included approximately $24,000 of stock option expense and $9,000 of stock awards. On September 15, 2016, the Company and LaVonne Lang entered into an executive employment agreement as the Companys VP, Regulatory Affairs, effective on September 15, 2016. Commencing on September 15, 2016, the Company agreed to pay Dr. Lang an annual salary of $250,000. In addition, the Company agreed to grant to Dr. Lang under the Cellceutix Corporation 2016 Equity Incentive Plan (i) 63,492 shares of restricted stock, which shall vest upon the earliest to occur of the following: (1) one third (33 1/3 %) upon the first anniversary of the effective date, one third (33 1/3 %) upon the second anniversary of the effective date, and the remaining one third (33 1/3 %) upon the third anniversary of the effective date; or (2) upon a Change in Control (as defined in the employment agreement) of the Company. Ten-year options to purchase 188,262 shares of the Companys common stock were also granted at an exercise price of $1.26 per share, which shall vest upon the earliest to occur of the following: (1) one third (33 1/3 %) upon the first anniversary of the effective date, and the remaining balance vesting monthly in equal portions over the following 24 months; and (2) upon a Change in Control (as defined in the employment agreement) of the Company. The 63,492 shares were valued at approximately $80,000, which will be amortized over three years to September 15, 2019. The 188,263 stock options were valued at approximately $220,000 and will be exercisable for 10 years at an exercise price of $1.26 per share. They will be amortized over 3 years to September 15, 2019. During the three months and six months ended December 31, 2016, the Company recorded approximately $25,000 and $29,000 of total stock-based compensation, respectively. The $25,000 of stock based compensation expense for the three months ended December 31, 2016 included approximately $18,000 of stock option expense and $7,000 of stock awards. The $29,000 of stock based compensation expense for the six months ended December 31, 2016 included approximately $21,000 of stock option expense and $8,000 of stock awards. For the six months ended December 31, 2015 On July 10, 2015, the Company issued 7,028 shares and 50,000 options to a consultant for his one year contract, which options are exercisable for 3 years at $2.49 per share of common stock. The total value of these 50,000 options was approximately $60,000 and we recognized approximately $60,000 of stock based compensation costs that was charged to Research and Development expense as of December 31, 2015. The assumptions we used in the Black Scholes option-pricing model were disclosed as above. Stock Warrants For the six months ended December 31, 2016 During the six months ended December 31, 2016, there were no warrants issued or exercised. The following table summarizes stock warrants: Warrants Weighted Average Exercise Price Weighted Average Remaining Contractual Life (Years) Aggregate Intrinsic Value Outstanding at June 30, 2016 25,000 $ 1.79 0.56 $ - Extended - - - Granted - - - Exercised - - - Expired - - - Outstanding at December 31, 2016 25,000 $ 1.79 0.06 $ - Exercisable at December 31, 2016 25,000 $ 1.79 0.06 $ - |
Equity Transactions
Equity Transactions | 6 Months Ended |
Dec. 31, 2016 | |
Notes to Financial Statements | |
Note 12 - Equity Transactions | Issuance of Common Stock for Cash $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 "Purchase Agreement") with 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. In consideration for entering into the Purchase 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 $48,000 and $44,000 were recorded to additional paid-in capital during the six months ended December 31, 2016 and 2015. The unamortized portion is carried on the balance sheet as deferred offering costs and was $310,000 and $358,000 at December 31, 2016 and June 30, 2016, respectively. During the period from March 30, 2015 to December 31, 2016, the Company had completed sales to Aspire totaling 8.2 million shares of common stock generating gross proceeds of approximately $11 million. Concurrently with entering into the Purchase 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 Purchase 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 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. During the six months ended December 31, 2016 and 2015, the Company had completed sales to Aspire totaling 2.4 million shares and 1.5 million shares of common stock generating gross proceeds of approximately $2.9 million and $2.6 million, respectively. Issuance of Common Stock by Exercise of Common Stock Options For the six months ended December 31, 2016 During the six months ended December 31, 2016, the Company has no issuance of common stock by exercise of common stock options. For the six months ended December 31, 2015 During the six months ended December 31, 2015, the Company recorded subscription receivable of $25,400 for the exercise of 60,000 Common Stock options at $0.42 per share. Issuance of Common Stock to Consultants For Services For the six months ended December 31, 2016 On July 18, 2016, the Company issued 7,500 shares to a consultant for service rendered. The value of these 7,500 shares at $1.38 per share was approximately $10,000. 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. For the six months ended December 31, 2015 On July 10, 2015, the Company issued 7,028 shares of restricted Class A common shares to a consultant for services rendered. The shares were granted and vested on July 10, 2015. The value of these 7,028 shares at $2.49 per share was approximately $17,500. Issuances of Common Stock and Stock Options Pursuant to Employment Agreements For the six months ended December 31, 2016 On September 1, 2016, the Company and Jane Harness entered into an executive employment agreement as the Companys VP, Clinical Sciences and Project Management, effective on September 1, 2016. Pursuant to the employment agreement, the Company issued 58,394 shares of restricted stock and options to purchase 172,987 shares of common stock to Ms. Harness under the Cellceutix Corporation 2016 Equity Incentive Plan. See Note 11 for additional information concerning the restricted stock and stock options granted to Ms. Harness. On September 15, 2016, the Company and LaVonne Lang entered into an executive employment agreement as the Companys VP, Regulatory Affairs, effective on September 15, 2016. Pursuant to the employment agreement, the Company issued 63,492 shares of restricted stock and options to purchase 188,263 shares of common stock to Dr. Lang under the Cellceutix Corporation 2016 Equity Incentive Plan. See Note 11 for additional information concerning the restricted stock and stock options granted to Dr. Lang. The following summarizes our restricted stock activity for the above restricted stock issuances: Weighted Average Grant Number of Date Fair Shares Value Total awards outstanding at June 30, 2016 1,066,667 $ 1.40 Total shares granted 121,886 1.31 Total shares outstanding at December 31, 2016 1,188,553 $ 1.39 Scheduled vesting for outstanding restricted stock at December 31, 2016 is as follows: Year Ending June 30, 2017 2018 2019 2020 Total Scheduled vestingrestricted stock 533,333 573,963 40,629 40,628 1,188,533 As of December 31, 2016, there was $1.3 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 $0.8 million of the compensation expected to be expensed in the next twelve months, and the total unrecognized compensation has a weighted average recognition period of 1.62 years. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Dec. 31, 2016 | |
Notes to Financial Statements | |
Note 13 - Subsequent Events | From January 4, 2017 to January 20, 2017, the Company has generated additional proceeds of approximately $455,000 under the Common Stock Purchase Agreement with Aspire Capital from the sale 400,000 shares of its common stock. |
Significant Accounting Polici19
Significant Accounting Policies and Recent Accounting Pronouncements (Policies) | 6 Months Ended |
Dec. 31, 2016 | |
Significant Accounting Policies And Recent Accounting Pronouncements Policies | |
Reclassifications | Certain prior year amounts have been reclassified to conform to current period presentation. Such reclassifications were limited to the Condensed Balance Sheets and did not impact the Condensed Statement of Operations and Condensed Statement of Cash Flows. |
Use of Estimates | The preparation of 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 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. |
Basic Earnings (Loss) per Share | Basic and diluted earnings (loss) 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 of 45.1 million shares and 44.0 million shares were excluded from the computation of diluted earnings (loss) per share for the three months and six months ended December 31, 2016 and 2015, respectively, because their effect is anti-dilutive. |
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 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 counterpartys 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 is 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 vesting method over the requisite service period of the equity awards. The components of stock based compensation related to stock options and stock awards in the Companys Statement of Operations for the three months and six months ended December 31, 2016 and 2015 are as follows (rounded to nearest thousand): Three Months Ended Six Months Ended December 31, December 31, 2016 2015 2016 2015 General and administrative expenses Professional fees $ - $ 432,000 $ - $ 432,000 Research and development expenses Professional fees $ 8,000 $ - $ 50,000 $ 78,000 Employees bonus 50,000 - 62,000 - Officers bonus 289,000 - 578,000 20,000 Total share-based compensation expense $ 347,000 $ 432,000 $ 690,000 $ 530,000 |
Recent Accounting Pronouncements | Standards Issued Not Yet Adopted In August 2014, the FASB issued ASU 2014-15, Presentation of Financial StatementsGoing ConcernDisclosure of Uncertainties about an Entitys Ability to Continue as a Going Concern (ASU 2014-15). ASU 2014-15 requires management to assess an entitys 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 Companys first quarter of fiscal 2018. Management believes that the adoption of this guidance will not have a material impact on our 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 fiscal year 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. Management believes that the adoption of this guidance will not have a material impact on our 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 has been continuously assessing the impact of this guidance. In March 2016, the FASB issued ASU 2016-09, Compensation-Stock Compensation (ASU 2016-09). Under ASU 2016-09, entities will be required to recognize the income tax effects of awards in the income statement when the awards vest or are settled. The guidance on employers accounting for an employees use of shares to satisfy the employers statutory income tax withholding obligation and for forfeitures is also changing. For public business entities, ASU 2016-09 is effective for fiscal years beginning after December 15, 2016, and interim periods within those years. Early adoption is permitted, but all of the guidance must be adopted in the same period. Management believes that the adoption of this guidance will not have a material impact on our financial statements. Standards Issued and Adopted 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 has adopted this guidance and it did not have a material impact on our condensed financial statements. |
Significant Accounting Polici20
Significant Accounting Policies and Recent Accounting Pronouncements (Tables) | 6 Months Ended |
Dec. 31, 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 | Three Months Ended Six Months Ended December 31, December 31, 2016 2015 2016 2015 General and administrative expenses Professional fees $ - $ 432,000 $ - $ 432,000 Research and development expenses Professional fees $ 8,000 $ - $ 50,000 $ 78,000 Employees bonus 50,000 - 62,000 - Officers bonus 289,000 - 578,000 20,000 Total share-based compensation expense $ 347,000 $ 432,000 $ 690,000 $ 530,000 |
Patents, net (Tables)
Patents, net (Tables) | 6 Months Ended |
Dec. 31, 2016 | |
Patents Net Tables | |
Schedule of patents | Useful life (years) December 31, 2016 June 30, 2016 Purchased Patent Rights Brilacidin, and related compounds 14 $ 4,082,000 $ 4,082,000 Purchased Patent Rights Anti-microbial surfactants and related compounds 12 144,000 144,000 Patents Kevetrin and related compounds 17 1,088,000 1,035,000 5,314,000 5,261,000 Less: Accumulated amortization for Brilacidin, Anti-microbial- surfactants and related compounds (1,007,000 ) (855,000 ) Accumulated amortization for Patents Kevetrin and related compounds (126,000 ) (95,000 ) $ 4,181,000 $ 4,311,000 |
Accounts Payable (Tables)
Accounts Payable (Tables) | 6 Months Ended |
Dec. 31, 2016 | |
Accounts Payable Tables | |
Schedule of Accounts payable | December 31, 2016 June 30, 2016 Accounts payable $ 1,719,000 $ 2,026,000 Accounts payable (Note 9) related parties 1,504,000 1,502,000 Total $ 3,223,000 $ 3,528,000 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 6 Months Ended |
Dec. 31, 2016 | |
Accrued Expenses Tables | |
Schedule of accrued expenses | December 31, 2016 June 30, 2016 Accrued research and development consulting fees $ 411,000 $ 25,000 Accrued rent (Note 9) related party 26,000 32,000 Accrued interest (Note 10) related party 112,000 40,000 Total $ 549,000 $ 97,000 |
Accrued Salaries and Payroll 24
Accrued Salaries and Payroll Taxes - Related Parties And Other (Tables) | 6 Months Ended |
Dec. 31, 2016 | |
Accrued Salaries And Payroll Taxes - Related Parties And Other Tables | |
Schedule of accrued salaries and payroll taxes | December 31, 2016 June 30, 2016 Accrued salaries related parties $ 2,647,000 $ 2,647,000 Accrued payroll taxes related parties 130,000 130,000 Withholding tax 85,000 57,000 Total $ 2,862,000 $ 2,834,000 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 6 Months Ended |
Dec. 31, 2016 | |
Commitments And Contingencies Tables | |
Future minimum lease payments required under the non-cancelable operating lease | Year ending June 30, 2017 109,000 2018 217,000 2019 54,000 Total minimum payments $ 380,000 |
Equity Incentive Plans, Stock26
Equity Incentive Plans, Stock-Based Compensation and Warrants (Tables) | 6 Months Ended |
Dec. 31, 2016 | |
Stock Warrants [Member] | |
Schedule of stock option activity | Warrants Weighted Average Exercise Price Weighted Average Remaining Contractual Life (Years) Aggregate Intrinsic Value Outstanding at June 30, 2016 25,000 $ 1.79 0.56 $ - Extended - - - Granted - - - Exercised - - - Expired - - - Outstanding at December 31, 2016 25,000 $ 1.79 0.06 $ - Exercisable at December 31, 2016 25,000 $ 1.79 0.06 $ - |
Stock Options [Member] | |
Valuation assumptions for stock options/warrants and SARs | Six Months Ended December 31, 2016 2015 Expected term (in years) 3 - 10 3 Expected stock price volatility 57.63% to 111.62% 56.52% to 65.76% Risk-free interest rate 0.71% to 1.73% 1.04% to 1.16% Expected dividend yield 0 0 |
Schedule of stock option activity | Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Life (Years) Aggregate Intrinsic Value Outstanding at June 30, 2016 40,444,728 $ 0.22 4.58 $ 48,185,911 Granted 368,779 1.31 9.55 - Exercised - - - - Forfeited/expired - - - - Outstanding at December 31, 2016 40,813,507 $ 0.23 4.13 $ 39,336,598 Exercisable at December 31, 2016 39,769,611 $ 0.20 4.00 $ 39,334,409 |
Equity Transactions (Tables)
Equity Transactions (Tables) | 6 Months Ended |
Dec. 31, 2016 | |
Equity Transactions Tables | |
Schedule of Restricted Stock Award Activity | Weighted Average Grant Number of Date Fair Shares Value Total awards outstanding at June 30, 2016 1,066,667 $ 1.40 Total shares granted 121,886 1.31 Total shares outstanding at December 31, 2016 1,188,553 $ 1.39 |
Schedule of vesting outstanding restricted stock | Year Ending June 30, 2017 2018 2019 2020 Total Scheduled vestingrestricted stock 533,333 573,963 40,629 40,628 1,188,533 |
Liquidity (Details Narrative)
Liquidity (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||||||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | Mar. 31, 2015 | |
Liquidity Details Narrative | ||||||||
Cash and cash equivalents | $ 3,859,000 | $ 6,183,000 | $ 3,859,000 | $ 6,183,000 | $ 6,310,000 | $ 8,410,000 | ||
Net loss | (3,358,000) | $ (3,223,000) | (6,386,000) | $ (5,900,000) | ||||
Working capital (deficit) | (4,600,000) | $ (4,600,000) | $ (1,900,000) | |||||
Purchase of common stock | $ 30,000,000 | |||||||
Purchase Agreement Term | 3 years | |||||||
Common stock purchase available balance | $ 19,000,000 | $ 19,000,000 | ||||||
Future expenses | $ 19,000,000 | |||||||
Clinical trials expenses | $ 15,000,000 |
Significant Accounting Polici29
Significant Accounting Policies and Recent Accounting Pronouncements (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | |
General and administrative expenses | ||||
Professional fees | $ 432,000 | $ 432,000 | ||
Research and development expenses | ||||
Professional fees | 8,000 | 50,000 | 78,000 | |
Employees' bonus | 50,000 | 62,000 | ||
Officers' bonus | 289,000 | 578,000 | 20,000 | |
Total share-based compensation expense | $ 347,000 | $ 432,000 | $ 690,000 | $ 530,000 |
Significant Accounting Polici30
Significant Accounting Policies and Recent Accounting Pronouncements (Detail Narrative) - shares | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | |
Significant Accounting Policies And Recent Accounting Pronouncements Detail Narrative | ||||
Diluted earnings (loss) per share | 45,100,000 | 45,100,000 | 44,000,000 | 44,000,000 |
Patents, net (Details)
Patents, net (Details) - USD ($) | 6 Months Ended | |
Dec. 31, 2016 | Jun. 30, 2016 | |
Purchased Patent Rights | $ 5,314,000 | $ 5,261,000 |
Patent costs - net | $ 4,181,000 | 4,311,000 |
Patents [Member] | ||
Useful life | 14 years | |
Purchased Patent Rights | $ 4,082,000 | 4,082,000 |
Accumulated amortization | $ (1,007,000) | (855,000) |
Patents Two [Member] | ||
Useful life | 12 years | |
Purchased Patent Rights | $ 144,000 | 144,000 |
Patents Three [Member] | ||
Useful life | 17 years | |
Purchased Patent Rights | $ 1,088,000 | 1,035,000 |
Accumulated amortization | $ (126,000) | $ (95,000) |
Patents, net (Details Narrative
Patents, net (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | |
Amortization expense | $ 92,000 | $ 107,000 | $ 183,000 | $ 204,000 |
Year 2017 [Member] | ||||
Estimated annual amortization expense | 181,000 | |||
Year 2018-2025 [Member] | ||||
Estimated annual amortization expense | 364,000 | |||
Year 2026 [Member] | ||||
Estimated annual amortization expense | 354,000 | |||
Year 2027 [Member] | ||||
Estimated annual amortization expense | 352,000 | |||
Year 2028 [Member] | ||||
Estimated annual amortization expense | 114,000 | |||
Year 2029 and 2032 [Member] | ||||
Estimated annual amortization expense | 61,000 | |||
Year 2033 [Member] | ||||
Estimated annual amortization expense | 24,000 | |||
Year 2034 [Member] | ||||
Estimated annual amortization expense | $ 1,000 | |||
Minimum and Intangible Assets - Patent (Member) | ||||
Estimated remaining useful lives of the assets | 12 years | |||
Amortization period | 9 years | |||
Maxiimum and Intangible Assets - Patent (Member) | ||||
Estimated remaining useful lives of the assets | 17 years | |||
Amortization period | 16 years |
Accounts Payable (Details)
Accounts Payable (Details) - USD ($) | Dec. 31, 2016 | Jun. 30, 2016 |
Accounts Payable Details | ||
Accounts payable | $ 1,719,000 | $ 2,026,000 |
Accounts payable (Note 9) – related parties | 1,504,000 | 1,502,000 |
Total | $ 3,223,000 | $ 3,528,000 |
Accounts Payable (Details Narra
Accounts Payable (Details Narrative) | 6 Months Ended |
Dec. 31, 2016USD ($) | |
Accounts Payable Details Narrative | |
Start-up fees | $ 593,000 |
Income from reversal of this accounts payable | $ 593,000 |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) | Dec. 31, 2016 | Jun. 30, 2016 |
Accrued Expenses Details | ||
Accrued research and development consulting fees | $ 411,000 | $ 25,000 |
Accrued rent (Note 9) – related parties | 26,000 | 32,000 |
Accrued interest (Note 10) related parties | 112,000 | 40,000 |
Total | $ 549,000 | $ 97,000 |
Accrued Salaries and Payroll 36
Accrued Salaries and Payroll Taxes - Related Parties And Other (Details) - USD ($) | Dec. 31, 2016 | Jun. 30, 2016 |
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 | 85,000 | 57,000 |
Total | $ 2,862,000 | $ 2,834,000 |
Commitments and Contingencies37
Commitments and Contingencies (Details) | Dec. 31, 2016USD ($) |
Year ending June 30, | |
2,017 | $ 109,000 |
2,018 | 217,000 |
2,019 | 54,000 |
Total minimum payments | $ 380,000 |
Commitments and Contingencies38
Commitments and Contingencies (Details Narrative) | 3 Months Ended | 6 Months Ended | |||
Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Oct. 01, 2013USD ($)ft² | |
Commitments And Contingencies Details Narrative | |||||
Operating leases, rental expense | $ 51,000 | $ 50,000 | $ 102,000 | $ 101,000 | |
Lease term | 5 years | ||||
Lease expiry date | Sep. 30, 2018 | ||||
Monthly payament on lease | $ 18,000 | ||||
Monthly payment on lease by officers | $ 900 | ||||
Area used by officers | ft² | 200 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | Dec. 07, 2007 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Jun. 30, 2016 |
Lease term | 5 years | |||||
Innovative Medical Research Inc [Member] | ||||||
Rent expense | $ 3,000 | $ 3,000 | $ 6,000 | $ 6,000 | ||
Kard Scientific [Member] | ||||||
Rental income | $ 900 | |||||
Rent payables | 26,000 | 26,000 | $ 32,000 | |||
Clinical Studies [Member] | ||||||
Accrued research and development expenses | $ 1,486,000 | $ 1,486,000 | $ 1,486,000 |
Note Payable - Related Party (D
Note Payable - Related Party (Details Narrative) - USD ($) | 12 Months Ended | |||||||||
Jun. 30, 2012 | Jun. 30, 2011 | Jun. 30, 2010 | Dec. 31, 2016 | Jun. 30, 2016 | May 08, 2012 | May 07, 2012 | Mar. 31, 2012 | Dec. 31, 2010 | Oct. 01, 2009 | |
Interest accrued | $ 112,000 | $ 40,000 | ||||||||
Principal balances of the demand note | $ 2,022,000 | $ 2,022,000 | ||||||||
Mr. Ehrlich [Member] | ||||||||||
Principal balances of the demand note | $ 2,022,000 | $ 2,002,000 | ||||||||
Additional loan balance | $ 20,000 | $ 997,000 | $ 973,000 | |||||||
Ehrlich Promissory Note C [Member] | ||||||||||
Interest accrued | $ 2,248,000 | $ 97,000 | ||||||||
Principal balances of the demand note | $ 2,248,000 | |||||||||
Bears interest rate | 9.00% | |||||||||
Common stock per share | $ 0.50 | |||||||||
Equity Incentive shares | 2,000,000 | |||||||||
Options exercisable | $ 0.51 | |||||||||
Closing bid price per share | $ 0.46 | |||||||||
Ehrlich Promissory Note C [Member] | Minimum [Member] | ||||||||||
Bears interest rate | 9.00% | |||||||||
Ehrlich Promissory Note C [Member] | Maximum [Member] | ||||||||||
Bears interest rate | 10.00% | |||||||||
Ehrlich Promissory Notes A and B [Member] | ||||||||||
Bears interest rate | 9.00% |
Equity Incentive Plans, Stock41
Equity Incentive Plans, Stock-Based Compensation and Warrants (Details) - Stock Options [Member] | 6 Months Ended |
Dec. 31, 2016USD ($)$ / sharesshares | |
Number of Outstanding, Beginning Balance | shares | 40,444,728 |
Granted | shares | 368,779 |
Exercised | shares | |
Forfeited/expired | shares | |
Number of Outstanding, Ending Balance | shares | 40,813,507 |
Number of Outstanding, Exercisable | shares | 39,769,611 |
Weighted Average Exercise Price, Beginning Balance | $ / shares | $ 0.22 |
Granted | $ / shares | 1.31 |
Exercised | $ / shares | |
Forfeited/expired | $ / shares | |
Weighted Average Exercise Price, Ending Balance | $ / shares | 0.23 |
Weighted Average Exercise Price, Exercisable | $ / shares | $ 0.20 |
Weighted average remaining contractual life (Years), Outstanding, Beginning Balance | 4 years 6 months 29 days |
Weighted average remaining contractual life (Years), Granted | 9 years 6 months 18 days |
Weighted average remaining contractual life (Years), Outstanding, Ending Balance | 4 years 1 month 17 days |
Weighted average remaining contractual life (Years), Exercisable | 4 years |
Aggregate intrinsic value, Beginning Balance | $ | $ 48,185,911 |
Aggregate intrinsic value, Ending Balance | $ | 39,336,598 |
Aggregate intrinsic value, Exercisable | $ | $ 39,334,409 |
Equity Incentive Plans, Stock42
Equity Incentive Plans, Stock-Based Compensation and Warrants (Details 1) - Stock Options [Member] | 6 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Expected term (in years) | 3 years | |
Expected dividend yield | 0.00% | 0.00% |
Minimum [Member] | ||
Expected term (in years) | 3 years | |
Expected stock price volatility | 57.63% | 56.52% |
Risk-free interest rate | 0.71% | 1.04% |
Maximum [Member] | ||
Expected term (in years) | 10 years | |
Expected stock price volatility | 111.62% | 65.76% |
Risk-free interest rate | 1.73% | 1.16% |
Equity Incentive Plans, Stock43
Equity Incentive Plans, Stock-Based Compensation and Warrants (Details 2) - Stock Warrants [Member] | 6 Months Ended |
Dec. 31, 2016USD ($)$ / sharesshares | |
Number of Outstanding, Beginning Balance | shares | 25,000 |
Extended | shares | |
Granted | shares | |
Exercised | shares | |
Expired | shares | |
Number of Outstanding, Ending Balance | shares | 25,000 |
Number of Outstanding, Exercisable | shares | 25,000 |
Weighted Average Exercise Price, Beginning Balance | $ / shares | $ 1.79 |
Extended | $ / shares | |
Granted | $ / shares | |
Exercised | $ / shares | |
Expired | $ / shares | |
Weighted Average Exercise Price, Ending Balance | $ / shares | 1.79 |
Weighted Average Exercise Price, Exercisable | $ / shares | $ 1.79 |
Weighted average remaining contractual life (Years), Outstanding, Beginning Balance | 6 months 22 days |
Weighted average remaining contractual life (Years), Outstanding, Ending Balance | 22 days |
Weighted average remaining contractual life (Years), Exercisable | 22 days |
Aggregate intrinsic value, Beginning Balance | $ | |
Aggregate intrinsic value, Ending Balance | $ | |
Aggregate intrinsic value, Exercisable | $ |
Equity Incentive Plans, Stock44
Equity Incentive Plans, Stock-Based Compensation and Warrants (Details Narrative) - USD ($) | Sep. 01, 2016 | Sep. 15, 2016 | Jul. 18, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2016 | Dec. 31, 2015 |
Exercise price | $ 0.42 | |||||||
Stock based compensation | $ 347,000 | $ 432,000 | $ 690,000 | $ 530,000 | ||||
Stock option expenses | 272,000 | |||||||
Stock awards | $ 418,000 | |||||||
Stock issued, Shares | 2,400,000 | 1,500,000 | ||||||
Stock issued, Value | $ 2,900,000 | $ 2,600,000 | ||||||
Consultant [Member] | ||||||||
Exercisable period | 3 years | |||||||
Stock based compensation | 0 | 4,000 | ||||||
Stock issued, Shares | 7,500 | |||||||
Stock issued, per share | $ 1.38 | |||||||
Stock issued, Value | $ 4,000 | |||||||
September 15, 2016 [Member] | ||||||||
Stock based compensation | $ 25,000 | $ 29,000 | ||||||
Stock based compensation description | The $25,000 of stock based compensation expense for the three months ended December 31, 2016 included approximately $18,000 of stock option expense and $7,000 of stock awards | The $29,000 of stock based compensation expense for the six months ended December 31, 2016 included approximately $21,000 of stock option expense and $8,000 of stock awards | ||||||
Stock Options [Member] | ||||||||
Exercise price | $ 1.39 | |||||||
Exercisable period | 10 years | 10 years | 10 years | |||||
Stock issued, Shares | 172,987 | 188,263 | 617,839 | |||||
Stock issued, per share | $ 1.26 | $ 1.26 | ||||||
Stock issued, Value | $ 220,000 | $ 220,000 | $ 800,000 | |||||
September 1, 2016 [Member] | ||||||||
Stock based compensation | $ 25,000 | $ 33,000 | ||||||
Stock based compensation description | The $25,000 of stock based compensation expense for the three months ended December 31, 2016 included approximately $18,000 of stock option expense and $7,000 of stock awards | The $33,000 of stock based compensation expense for the six months ended December 31, 2016 included approximately $24,000 of stock option expense and $9,000 of stock awards | ||||||
December 31, 2016 [Member] | ||||||||
Stock based compensation | $ 289,000 | $ 578,000 | ||||||
Stock based compensation description | The $289,000 of stock based compensation expense for the three months ended December 31, 2016 included approximately $101,000 of stock option expense and $188,000 of stock awards | The $578,000 of stock based compensation expense for the six months ended December 31, 2016 included approximately $202,000 of stock option expense and $376,000 of stock awards | ||||||
2010 Equity Incentive Plan [Member] | ||||||||
Common stock shares reserved and issuance | 45,000,000 | 45,000,000 | 45,000,000 | |||||
July 10, 2015 [Member] | Consultant [Member] | ||||||||
Exercisable period | 3 years | |||||||
Stock option expenses | $ 60,000 | |||||||
Stock issued, Shares | 7,028 | |||||||
Stock issued, per share | $ 2.49 | |||||||
Option issued | 50,000 | |||||||
Option issued value | $ 60,000 | |||||||
September 15, 2016 [Member] | ||||||||
Shares and options shall vest description | (i) 63,492 shares of restricted stock, which shall vest upon the earliest to occur of the following: (1) one third (33 1/3 %) upon the first anniversary of the effective date, one third (33 1/3 %) upon the second anniversary of the effective date, and the remaining one third (33 1/3 %) upon the third anniversary of the effective date; or (2) upon a Change in Control (as defined in the employment agreement) of the Company. | |||||||
Stock issued, Shares | 63,492 | |||||||
Stock issued, per share | $ 1.26 | |||||||
Stock issued, Value | $ 80,000 | |||||||
Annual salary | $ 250,000 | |||||||
On September 1, 2016 [Member] | ||||||||
Shares and options shall vest description | (i) 58,394 shares of restricted stock, which shall vest upon the earliest to occur of the following: (1) one third (33 1/3 %) upon the first anniversary of the effective date, one third (33 1/3 %) upon the second anniversary of the effective date, and the remaining one third (33 1/3 %) upon the third anniversary of the effective date; or (2) upon a Change in Control (as defined in the employment agreement) of the Company. | |||||||
Stock issued, Shares | 58,394 | |||||||
Stock issued, per share | $ 1.37 | |||||||
Stock issued, Value | $ 80,000 | |||||||
Annual salary | $ 250,000 | |||||||
On June 30, 2016 [Member] | Common Class A | ||||||||
Exercise price | $ 1.39 | |||||||
Exercisable period | 10 years | |||||||
Restricted stock | 617,839 | 617,839 | 617,839 | |||||
Shares and options shall vest description | (1) 50% upon the first anniversary of the effective date, and the remaining 50% upon the second anniversary of the effective date | |||||||
Common stock closing preice | $ 3 | $ 3 | $ 3 | |||||
Stock option exercise price | $ 1.39 | $ 1.39 | $ 1.39 | |||||
Stock issued, Shares | 1,066,667 | |||||||
Stock issued, Value | $ 1,500,000 | |||||||
On June 30, 2016 [Member] | 2016 Equity Incentive Plan [Member] | ||||||||
Shares and options shall vest description | Up to 20,000,000 shares of the Company's common stock may be issued under the 2016 Plan (subject to adjustment as described in the 2016 Plan); provided that, no Outside Director (as defined in the 2016 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. | |||||||
On December 31, 2010 [Member] | 2010 Equity Incentive Plan [Member] | ||||||||
Restricted stock | 1,066,667 | 1,066,667 | 1,066,667 | |||||
On June 27, 2016 [Member] | ||||||||
Stock based compensation | $ 289,000 | |||||||
Stock option expenses | 101,000 | |||||||
Stock awards | 188,000 | |||||||
Annual salary | $ 440,000 | |||||||
On April 6, 2016 [Member] | ||||||||
Common stock shares reserved and issuance | 25,000 | 25,000 | 25,000 | |||||
Stock option expenses | $ 3,000 | $ 6,000 | ||||||
Stock options to purchase par value $0.0001, value | $ 14,000 | |||||||
Stock option exercise price | $ 1.77 | $ 1.77 | $ 1.77 | |||||
Closing bid price per share | $ 1.61 | 1.61 | $ 1.61 | |||||
Stock issued, Shares | 25,000 | |||||||
Stock issued, per share | $ 1.61 | |||||||
Stock issued, Value | $ 40,520 | |||||||
On February 16, 2016 [Member] | ||||||||
Stock option expenses | $ 5,000 | $ 14,000 | ||||||
Stock options to purchase par value $0.0001, shares | 119,424 | |||||||
Stock options to purchase par value $0.0001, value | $ 55,000 | |||||||
Stock option exercise price | $ 1.105 | 1.105 | $ 1.105 | |||||
Closing bid price per share | $ 1.15 | $ 1.15 | $ 1.15 | |||||
On April 5, 2009 [Member] | 2009 Stock Option Plan [Member] | ||||||||
Incentive Stock Options | 2,000,000 |
Equity Transactions (Details)
Equity Transactions (Details) - Restricted Stock [Member] | 6 Months Ended |
Dec. 31, 2016$ / sharesshares | |
Number of Outstanding, Beginning Balance | shares | 1,066,667 |
Total shares granted | shares | 121,886 |
Number of Outstanding, Ending Balance | shares | 1,188,553 |
Weighted Average Exercise Price, Beginning Balance | $ / shares | $ 1.40 |
Total shares granted | $ / shares | 1.31 |
Weighted Average Exercise Price, Ending Balance | $ / shares | $ 1.39 |
Equity Transactions (Details 1)
Equity Transactions (Details 1) - shares | 6 Months Ended | 12 Months Ended | |||
Dec. 31, 2016 | Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | |
Restricted Stock [Member] | |||||
Scheduled vesting - restricted stock | 1,188,533 | 40,628 | 40,629 | 573,963 | 533,333 |
Equity Transactions (Details Na
Equity Transactions (Details Narrative) - USD ($) | 1 Months Ended | 6 Months Ended | 21 Months Ended | |||
Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2016 | Jun. 30, 2016 | Mar. 30, 2015 | |
Deferred offering costs | $ 310,000 | $ 310,000 | $ 358,000 | |||
Number of common stock shares sold | 2,400,000 | 1,500,000 | ||||
Value of common stock shares sold | $ 2,900,000 | $ 2,600,000 | ||||
Unrecognized compensation | 1,300,000 | 1,300,000 | ||||
Expected compensation | $ 800,000 | 800,000 | ||||
Compensation weighted average recognition period | 1 year 7 months 13 days | |||||
Additional paid-in capital | $ 60,526,000 | 60,526,000 | 56,969,000 | |||
Subscription receivable | $ 25,400 | |||||
Exercise of common Stock options | 60,000 | |||||
Exercise price | $ 0.42 | |||||
Common Class A | 30 Million Common Stock Purchase Agreement [Member] | Aspire Capital Fund Llc [Member] | ||||||
Deferred offering costs | 310,000 | $ 310,000 | $ 358,000 | |||
Number of common stock shares sold | 160,000 | 8,200,000 | ||||
Value of common stock shares sold | $ 11,000,000 | |||||
Number of common stock shares purchase | 30,000,000 | |||||
Term of the Purchase Agreement | 3 years | |||||
Commitment fee | $ 499,000 | |||||
Additional paid-in capital | $ 44,000 | $ 44,000 | $ 48,000 | |||
Shelf registration statement on Form S-3 | $ 75,000,000 | |||||
September 15, 2016 [Member] | ||||||
Number of common stock shares sold | 63,492 | |||||
Value of common stock shares sold | $ 80,000 | |||||
Issuances of Common Stock and Stock Options [Member] | September 15, 2016 [Member] | ||||||
Restricted stock and options issued | 63,492 | |||||
Option to purchase of copmmon stock | 188,263 | |||||
Issuances of Common Stock and Stock Options [Member] | September 1, 2016 [Member] | ||||||
Restricted stock and options issued | 58,394 | |||||
Option to purchase of copmmon stock | 172,987 | |||||
Issuance of Common Stock to Consultants For Services [Member] | July 10, 2016 [Member] | ||||||
Value of common stock shares sold | $ 17,500 | |||||
Restricted stock and options issued | 7,028 | |||||
Exercise price | $ 2.49 | |||||
Issuance of Common Stock to Consultants For Services [Member] | July 18, 2016 [Member] | ||||||
Number of common stock shares sold | 7,500 | |||||
Value of common stock shares sold | $ 10,000 | |||||
Exercise price | $ 1.38 | |||||
Issuance of Common Stock to Consultants For Services [Member] | August 1, 2016 [Member] | ||||||
Value of common stock shares sold | $ 15,000 | |||||
Restricted stock and options issued | 11,720 | |||||
Exercise price | $ 1.28 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - Aspire Capital Fund Llc [Member] | 1 Months Ended |
Jan. 20, 2017USD ($)shares | |
Common Stock Purchase Agreement | $ | $ 455,000 |
Sale of common stock | shares | 400,000 |