Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Mar. 31, 2014 | Jun. 30, 2013 | |
Document And Entity Information | ' | ' | ' |
Entity Registrant Name | 'AUDIOEYE INC | ' | ' |
Entity Central Index Key | '0001362190 | ' | ' |
Document Type | '10-K | ' | ' |
Document Period End Date | 31-Dec-13 | ' | ' |
Amendment Flag | 'false | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' |
Entity Well-known Seasoned Issuer | 'No | ' | ' |
Entity Voluntary Filers | 'No | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' |
Entity Filer Category | 'Smaller Reporting Company | ' | ' |
Entity Public Float | ' | ' | $6,899,207 |
Entity Common Stock, Shares Outstanding | ' | 55,350,342 | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
Document Fiscal Year Focus | '2013 | ' | ' |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Current Assets | ' | ' |
Cash | $1,847,004 | $11,710 |
Accounts receivable, net | 569,297 | 16,256 |
Related party receivables | 82,250 | 16,125 |
Marketable securities | 0 | 30,000 |
Total Current Assets | 2,498,551 | 74,091 |
Property and equipment, net | 3,847 | 7,043 |
Intangible assets, net | 3,073,945 | 3,418,621 |
Goodwill | 700,528 | 700,528 |
Total Assets | 6,276,871 | 4,200,283 |
Current Liabilities | ' | ' |
Accounts payable and accrued expenses | 416,531 | 498,366 |
Deferred revenue | ' | 54,823 |
Notes and loans payable-current | 172,845 | 1,466,700 |
Related party payable | 243,424 | 829,418 |
Total Current Liabilities | 832,800 | 2,849,307 |
Long Term liabilities | ' | ' |
Notes and loans payable-long term | 79,800 | 97,800 |
Related party loans | 35,000 | 10,000 |
Total Long Term Liabilities | 114,800 | 107,800 |
Total Liabilities | 947,600 | 2,957,107 |
STOCKHOLDERS' DEFICIT | ' | ' |
Preferred Stock, $0.00001 par value, 10,000,000 and 500,000 shares authorized, none issued and outstanding as of December 31, 2013 and 2012, respectively | ' | ' |
Common stock, $0.00001 par value, 100,000,000 shares authorized, 53,239,369 and 35,192,045 issued and outstanding, as of December 31, 2013 and 2012, respectively | 532 | 352 |
Treasury stock | -623,000 | ' |
Additional paid in capital | 13,231,212 | 5,639,671 |
Accumulated deficit | -7,279,473 | -4,396,847 |
Total Stockholders' Equity-AudioEye, Inc. | 5,329,271 | 1,243,176 |
Total Stockholders' Equity | 5,329,271 | 1,243,176 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $6,276,871 | $4,200,283 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
CONSOLIDATED BALANCE SHEETS | ' | ' |
Preferred Stock, par value (in dollars per share) | $0.00 | $0.00 |
Preferred Stock, shares authorized | 10,000,000 | 500,000 |
Preferred Stock, shares issued | 0 | 0 |
Preferred Stock, shares outstanding | 0 | 0 |
Common Stock, par value (in dollars per share) | $0.00 | $0.00 |
Common Stock, shares authorized | 100,000,000 | 100,000,000 |
Common Stock, shares issued | 53,239,369 | 35,192,045 |
Common Stock, shares outstanding | 53,239,369 | 35,192,045 |
CONSOLIDATED_STATEMENTS_OF_OPE
CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
CONSOLIDATED STATEMENTS OF OPERATIONS | ' | ' |
Revenues | $1,449,660 | $279,062 |
Revenues from related party | 108,500 | 3,000 |
Total revenues | 1,558,160 | 282,062 |
Cost of services | 404,088 | 265,330 |
Gross Profit | 1,154,072 | 16,732 |
Selling and marketing expenses | 301,280 | ' |
Research and technology expenses | 56,515 | ' |
General and administrative expenses | 3,243,382 | 904,347 |
Amortization and depreciation | 359,414 | 149,179 |
Total operating expenses | 3,960,591 | 1,053,526 |
Operating income (loss) | -2,806,519 | -1,036,794 |
Other income (expense) | ' | ' |
Realized gain (loss) on marketable securities | -19,500 | 12,000 |
Interest expense | -56,607 | -141,495 |
Total other income (expense) | -76,107 | -129,495 |
Net (loss) | ($2,882,626) | ($1,166,289) |
Net (loss) per common share - basic and diluted (in dollars per share) | ($0.07) | ($0.04) |
Weighted average common shares outstanding - basic and diluted (in shares) | 42,514,610 | 30,161,501 |
CONSOLIDATED_STATEMENT_OF_STOC
CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIT (USD $) | Total | COMMON STOCK | PAID-IN CAPITAL | NON-CONTROLLING INTEREST | ACCUMULATED (DEFICIT) |
Beginning balance at Dec. 31, 2011 | ($2,126,276) | $300 | $1,118,683 | ($14,701) | ($3,230,558) |
Beginning balance (in shares) at Dec. 31, 2011 | ' | 30,005,185 | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' | ' | ' |
Common stock issued for services | 20,000 | ' | 20,000 | ' | ' |
Stock option expense | 11,309 | ' | 11,309 | ' | ' |
Acquisition of AEAC - merger of entities under common control | 3,123,136 | ' | 3,123,136 | ' | ' |
Acquisition of non-controlling interest | ' | ' | -14,701 | 14,701 | ' |
Forgiveness of related party accrued interest | 84,581 | ' | 84,581 | ' | ' |
Issuance of stock related to conversion of debt | 1,296,715 | 52 | 1,296,663 | ' | ' |
Issuance of stock related to conversion of debt (in shares) | ' | 5,186,860 | ' | ' | ' |
Net loss | -1,166,289 | ' | ' | ' | -1,166,289 |
Ending balance at Dec. 31, 2012 | 1,243,176 | 352 | 5,639,671 | ' | -4,396,847 |
Ending balance (in shares) at Dec. 31, 2012 | 35,192,045 | 35,192,045 | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' | ' | ' |
Common stock issued for debt and interest | 1,709,291 | 79 | 1,709,212 | ' | ' |
Common stock issued for debt and interest (in shares) | ' | 7,870,154 | ' | ' | ' |
Common stock issued for cash, net | 3,231,992 | 111 | 3,231,881 | ' | ' |
Common stock issued for cash, net (in shares) | ' | 11,130,336 | ' | ' | ' |
Common stock issued for related party debt | 224,000 | 7 | 223,993 | ' | ' |
Common stock issued for related party debt (in shares) | ' | 746,667 | ' | ' | ' |
Common stock issued for services | 50,000 | 2 | 49,998 | ' | ' |
Common stock issued for services (in shares) | ' | 200,000 | ' | ' | ' |
Common stock issued for related party accounts payable | 50,000 | 1 | 49,999 | ' | ' |
Common stock issued for related party accounts payable (in shares) | ' | 100,000 | ' | ' | ' |
Options exercised | 47,750 | 2 | 47,748 | ' | ' |
Options exercised (in shares) | ' | 184,750 | ' | ' | ' |
Warrants issued for conversion of accrued salary | 1,022,751 | ' | 1,022,751 | ' | ' |
Warrants issued for conversion of accounts payable | 51,000 | ' | 51,000 | ' | ' |
Warrants. Options and PSU issued for services | 1,191,128 | ' | 1,191,128 | ' | ' |
Debt discount for warrants issued with debt | 13,831 | ' | 13,831 | ' | ' |
Less: Treasury stock: at cost | -623,022 | -22 | ' | -623,000 | ' |
Less: Treasury stock: at cost (in shares) | ' | -2,184,583 | ' | ' | ' |
Net loss | -2,882,626 | ' | ' | ' | -2,882,626 |
Ending balance at Dec. 31, 2013 | $5,329,271 | $532 | $13,231,212 | ($623,000) | ($7,279,473) |
Ending balance (in shares) at Dec. 31, 2013 | 53,239,369 | 53,239,369 | ' | ' | ' |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Cash Flows from operating activities: | ' | ' |
Net (loss) | ($2,882,626) | ($1,166,289) |
Adjustments to reconcile net loss to net cash | ' | ' |
Depreciation and amortization | 359,414 | 137,076 |
Stock, option and warrant expense | 1,241,128 | 31,309 |
Amortization of debt discount | 12,676 | ' |
Realized (gain) loss on investments | 19,500 | -12,000 |
Changes in operating assets and liabilities: | ' | ' |
Accounts receivable | -603,041 | -4,619 |
Related party receivable | -66,125 | -3,000 |
Accounts payable and accruals | 53,256 | 241,529 |
Deferred revenue | -54,823 | 41,628 |
Related party payables | 522,257 | 431,148 |
Net cash (used in) operating activities | -1,398,384 | -303,218 |
Cash Flows from investing activities: | ' | ' |
Cash (paid for) intellectual property | -11,542 | -2,928 |
Net cash (used in) investing activities | -11,542 | -2,928 |
Cash Flows from financing activities: | ' | ' |
Payments on related party loans | ' | -2,500 |
Payments on debt | -218,000 | -742,000 |
Repurchase of treasury stock | -573,022 | ' |
Issuance of common stock for cash | 3,231,992 | ' |
Proceeds from exercise of warrants | 47,750 | ' |
Borrowings on related party debt | 224,000 | 12,500 |
Borrowings on debt | 532,500 | 1,017,700 |
Net cash provided by financing activities | 3,245,220 | 285,700 |
Increase (decrease) in cash | 1,835,294 | -20,446 |
Cash - beginning of period | 11,710 | 32,156 |
Cash - end of period | 1,847,004 | 11,710 |
NON-CASH FINANCING ACTIVITIES | ' | ' |
Debt discount for warrants issued with debt | 13,831 | ' |
Payment of related party debt in exchange for available for sale securities | 10,500 | ' |
Repayment of debt with common stock | 1,709,291 | 1,296,715 |
Repayment of related party debt with common stock | 224,000 | ' |
Warrants issued for accrued salary | 1,022,751 | ' |
Warrants issued for accounts payable | 51,000 | ' |
Repayment of related party payables with common stock | 50,000 | ' |
Treasury stock purchased in exchange for reduction of accounts receivable | 50,000 | ' |
Forgiveness of related party debt and accrued interest | ' | 84,581 |
Accounts payable paid by related party loan | ' | 50,000 |
Intangible asset from the purchase of AudioEye by AEAC | ' | 3,123,136 |
Acquisition of non controlling interest | ' | 14,701 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | ' | ' |
Interest paid | $12,213 | $2,864 |
OVERVIEW
OVERVIEW | 12 Months Ended |
Dec. 31, 2013 | |
OVERVIEW | ' |
OVERVIEW | ' |
NOTE 1: OVERVIEW | |
AudioEye, Inc. (the “Company”) was incorporated on May 20, 2005 in the state of Delaware. On March 31, 2010, the Company was acquired by CMG Holdings Group, Inc., a Nevada corporation (“CMG”). Effective August 17, 2012, AudioEye Acquisition Corporation, a Nevada corporation (“AEAC”), acquired 80% of the Company’s then-outstanding common stock from CMG. | |
The Company has developed patented, Internet content publication and distribution software that enables conversion of any media into accessible formats and allows for real time distribution to end users on any Internet connected device. The Company’s focus is to create more comprehensive access to Internet, print, broadcast and other media to all people regardless of their network connection, device, location, or disabilities. | |
The Company is focused on developing innovations in the field of networked and device embedded audio technology. The Company owns a unique patent portfolio comprised of five issued patents in the United States, as well as three U.S. patents pending with additional patents being drafted for filing with the U.S. Patent and Trademark Office and internationally. | |
On August 17, 2012, AEAC acquired 80% of the Company from CMG. Pursuant to the agreement: | |
1. CMG would retain 15% of the Company. | |
2. CMG would distribute to its stockholders, in the form of a dividend, 5% of the capital stock of the Company. | |
3. The Company entered into a Royalty Agreement with CMG to pay to CMG 10% of cash received from income earned, settlements or judgments directly resulting from the Company’s patent enforcement and licensing strategy whether received by the Company or any of its affiliates, net of any direct costs or tax implications incurred in pursuit of such strategy pertaining to the patents. | |
4. The Company entered into a Services Agreement with CMG whereby CMG will receive a commission of not less than 7.5% of all revenues received by the Company after the closing date from all business, clients, or other sources of revenue procured by CMG or its employees, officers or subsidiaries, and directed to the Company, and 10% of net revenues obtained from a third party described in the agreement. | |
On March 22, 2013, the Company and AEAC entered into the Merger Agreement. Pursuant to the Merger Agreement, each share of AEAC common stock issued and outstanding immediately prior to the Merger effective date would be converted into .94134 share of the Company’s common stock and the outstanding convertible debentures of AEAC (the “AEAC Debentures”) in the aggregate principal amount of $1,400,200, together with accrued interest thereon of $67,732, would be assumed by the Company and then exchanged for convertible debentures of the Company (the “AE Debentures”). Effective March 25, 2013, the Merger was completed. In connection with the Merger, the stockholders of AEAC received on a pro rata basis the 24,004,143 shares of the Company’s common stock that were held by AEAC, and the former holders of the AEAC Debentures received an aggregate of 5,871,752 shares of the Company’s common stock pursuant to their conversion of all of the AE Debentures issued to replace the AEAC Debentures. | |
On November 12, 2013, the Company and CMG terminated the Royalty Agreement. | |
On December 30, 2013, the Company completed the repurchase of 2,184,583 shares of its common stock owned by CMG which shares were transferred to the Company in January, 2014 and retired to treasury. In connection, with the repurchase, the Company paid CMG $573,022 and forgave a $50,000 payable from an affiliate of CMG. | |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended | ||||||
Dec. 31, 2013 | |||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | ||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | ||||||
NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||||||
Basis of Presentation | |||||||
This summary of significant accounting policies is presented to assist in understanding the Company’s financial statements. These accounting policies conform to accounting principles, generally accepted in the United States of America, and have been consistently applied in the preparation of the financial statements. | |||||||
Principles of Consolidation and Non-Controlling Interest | |||||||
The consolidated financial statements include the accounts of the Company and its subsidiary, Empire Technologies, LLC (“Empire”). All significant inter-company accounts and transactions have been eliminated. In October 2010, the Company formed Empire as part of a joint venture with LVS Health Innovations, Inc. (“LVS”) whereby the Company owned 50% of Empire. Empire is considered a variable interest entity as defined by ASC 805-10 “Business Combinations” and the primary beneficiary of Empire as defined by ASC 805-10 and therefore consolidates the accounts of Empire for the year ending December 31, 2011. On April 30, 2012, LVS agreed to sell its 50% membership interest in Empire to the Company for consideration of $10 and the sum of previous LVS capital contributions paid in cash to Empire. The non-controlling interest was then eliminated and Empire is now treated as a 100% owned consolidated subsidiary. | |||||||
During the year ended December 31, 2013 and 2012, Empire had no activity. Empire had no assets or liabilities as of December 31, 2013 and December 31, 2012. | |||||||
The Company acquired 19.5 % of Couponicate for a nominal cost in the year ended December 31, 2012. The entity has no assets or liabilities and has no net income or loss. | |||||||
Use of Estimates | |||||||
The preparation of financial statements, in conformity with generally accepted accounting principles in the United States of America, requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, disclosures of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. | |||||||
Research and technology expenses | |||||||
Research and technology expenses are expensed in the period costs are incurred. For the year ended December 31, 2013, research and technology expenses totaled $56,515. | |||||||
Revenue Recognition | |||||||
Revenue is recognized when all applicable recognition criteria have been met, which generally include (a) persuasive evidence of an existing arrangement; (b) fixed or determinable price; (c) delivery has occurred or service has been rendered; and (d) collectability of the sales price is reasonably assured. For software and technology development contracts the company recognizes revenues on a percentage of completion method based upon several factors including but not limited to (a) estimate of total hours and milestones to complete; (b) total hours completed; (c) delivery of services rendered; (d) change in estimates; and (e) collectability of the contract. | |||||||
The Company had two major customers generate 81% and 81% of its revenue in the fiscal years ended December 31, 2013 and 2012. | |||||||
Deferred Revenue | |||||||
Revenue is recognized when services are performed and/or the project is completed. Certain contracts contain payment terms of 2-3 installments, which become due upon the completion of various stages of the project or service. | |||||||
The Company evaluates contracts upon receipt of installment payments to determine if the project and/or service has been completed. In the event an installment payment is received prior to the full completion of the contracted project or service, it is held as deferred revenue until the completion of the project and/or service. | |||||||
Certain website hosting contracts are prepared and invoiced on an annual basis. Any funds received for hosting services not provided yet are held in deferred revenue, and are recorded as revenue is earned. | |||||||
Fiscal Year End | |||||||
The Company has a fiscal year ending on December 31. | |||||||
Cash and Cash Equivalents | |||||||
The Company considers all highly liquid investments with maturities of three months or less at the time of purchase to be cash equivalents. | |||||||
Marketable Securities | |||||||
Marketable securities are classified as trading and consist of common stock holdings of publicly traded companies. These securities are marked to market at the end of each reporting period based on the closing price of the security at each balance sheet date. Changes in fair value are recorded as unrealized gains or losses in the consolidated statement of operations in accordance with ASC 320. | |||||||
Allowance for Doubtful Accounts | |||||||
The Company establishes an allowance for bad debts through a review of several factors including historical collection experience, current aging status of the customer accounts, and financial condition of the Company’s customers. The Company does not generally require collateral for its accounts receivable. There was an allowance for doubtful accounts of $0 and $102,000 as of December 31, 2013 and 2012, respectively. | |||||||
Property, Plant and Equipment | |||||||
Property and equipment are carried at the cost of acquisition or construction and depreciated over the estimated useful lives of the assets. Costs associated with repairs and maintenance are expensed as incurred. Costs associated with improvements which extend the life, increase the capacity or improve the efficiency of the Company’s property and equipment are capitalized and depreciated over the remaining life of the related asset. Gains and losses on dispositions of equipment are reflected in operations. Depreciation is provided using the straight-line method over the estimated useful lives of the assets, which are 5 to 7 years. | |||||||
Goodwill, Intangible Assets, and Long-lived | |||||||
Goodwill is carried at cost and is not amortized. The Company tests goodwill for impairment on an annual basis at the end of each fiscal year, relying on a number of factors including operating results, business plans, economic projections, anticipated future cash flows and marketplace data. Company management uses its judgment in assessing whether goodwill has become impaired between annual impairment tests according to specifications set forth in ASC 350. The Company completed an evaluation of goodwill base on qualitative assessment at December 31, 2013 and determined that there was no impairment. | |||||||
The fair value of the Company’s reporting unit is dependent upon the Company’s estimate of future cash flows and other factors. The Company’s estimates of future cash flows include assumptions concerning future operating performance and economic conditions and may differ from actual future cash flows. Estimated future cash flows are adjusted by an appropriate discount rate derived from the Company’s market capitalization plus a suitable control premium at date of the evaluation. The financial and credit market volatility directly impacts the Company’s fair value measurement through the Company’s weighted average cost of capital that the Company uses to determine its discount rate and through the Company’s stock price that the Company uses to determine its market capitalization. Therefore, changes in the stock price may also affect the amount of impairment recorded. Market capitalization is determined by multiplying the shares outstanding on the assessment date by the average market price of the Company’s common stock over a 30- day period before each assessment date. The Company’s uses this 30-day duration to consider inherent market fluctuations that may affect any individual closing price. The Company believes that its market capitalization alone does not fully capture the fair value of its business as a whole, or the substantial value that an acquirer would obtain from its ability to obtain control of the Company’s business. As such, in determining fair value, the Company adds a control premium to its market capitalization. To estimate the control premium, the Company considered its unique competitive advantages that would likely provide synergies to a market participant. In addition, the Company considered external market factors, which it believes, contributed to the decline and volatility in the Company’s stock price that did not reflect the Company’s underlying fair value. | |||||||
The Company recognizes an acquired intangible asset apart from goodwill whenever the intangible asset arises from contractual or other legal rights, or when it can be separated or divided from the acquired entity and sold, transferred, licensed, rented or exchanged, either individually or in combination with a related contract, asset or liability. Such intangibles are amortized over their useful lives. Impairment losses are recognized if the carrying amount of an intangible asset subject to amortization is not recoverable from expected future cash flows and its carrying amount exceeds its fair value. | |||||||
The Company reviews its long-lived assets, including property and equipment, identifiable intangibles, and goodwill annually or whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. To determine recoverability of its long-lived assets, the Company evaluates the probability that future undiscounted net cash flows will be less than the carrying amount of the assets. | |||||||
Impairment of Long-Lived Assets | |||||||
The Company’s long-lived assets, including intangibles, are reviewed for impairment whenever events or changes in circumstances indicate that the historical-cost carrying value of an asset may no longer be appropriate. The Company assesses recoverability of the asset by comparing the undiscounted future net cash flows expected to result from the asset to its carrying value. If the carrying value exceeds the undiscounted future net cash flows of the asset, an impairment loss is measured and recognized. An impairment loss is measured as the difference between the net book value and the fair value of the long-lived asset. | |||||||
Patents were evaluated for impairment and no impairment losses were incurred during the years ended December 31, 2013 and 2012, respectively. | |||||||
Equity-Based Payments | |||||||
The Company accounts for equity instruments issued to non-employees in accordance with the provisions of ASC 505-50, “Equity-Based Payments to Non-Employees”, which requires that such equity instruments are recorded at their fair value on the measurement date, with the measurement of such compensation being subject to periodic adjustment as the underlying equity instruments vest. | |||||||
The Company account for equity instruments issued to employees in accordance with ASC 718 “Stock Compensation”. Under this guidance, stock compensation expense is measured at the grant date, based on the fair value of the award, and is recognized as an expense over the estimated service period (generally the vesting period) on the straight-line attribute method. | |||||||
Income Taxes | |||||||
Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. These assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which the temporary differences are expected to reverse. | |||||||
The Company has net operating loss carryforwards available to reduce future taxable income. Future tax benefits for these net operating loss carryforwards are recognized to the extent that realization of these benefits is considered more likely than not. To the extent that the Company will not realize a future tax benefit, a valuation allowance is established. | |||||||
Earnings (Loss) Per Share | |||||||
Basic earnings (loss) per share are computed by dividing net income, or loss, by the weighted average number of shares of common stock outstanding for the period. Diluted earnings (loss) per share and basic earnings (loss) per share are not included in the net loss per share computation until the Company has Net Income. Diluted loss per share including the dilutive effects of common stock equivalents on an “as if converted” basis would reduce the loss per share and thereby be antidilutive. | |||||||
Financial instruments | |||||||
The carrying amount of the Company’s financial instruments, consisting of cash equivalents, short-term investments, account and notes receivable, accounts and notes payable, short-term borrowings and certain other liabilities, approximate their fair value due to their relatively short maturities. The carrying amount of the Company’s long-term debt approximates fair value since the stated rate of interest approximates a market rate of interest. | |||||||
Fair Value Measurements | |||||||
Fair value is an estimate of the exit price, representing the amount that would be received to, sell an asset or paid to transfer a liability in an orderly transaction between market participants (i.e., the exit price at the measurement date). Fair value measurements are not adjusted for transaction cost. Fair value measurement under generally accepted accounting principles provides for use of a fair value hierarchy that prioritizes inputs to valuation techniques used to measure fair value into three levels: | |||||||
Level 1: Unadjusted quoted prices in active markets for identical assets or liabilities | |||||||
Level 2: Inputs other than quoted market prices that are observable, either directly or indirectly, and reasonably available. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability and are developed based on market data obtained from sources independent of the Company. | |||||||
Level 3: Unobservable inputs reflect the assumptions that the Company develops based on available information about what market participants would use in valuing the asset or liability. | |||||||
An asset or liability’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Availability of observable inputs can vary and is affected by a variety of factors. The Company uses judgment in determining fair value of assets and liabilities and Level 3 assets and liabilities involve greater judgment than Level 1 and Level 2 assets or liabilities. | |||||||
The following are the Company’s marketable securities as of December 31, 2013 and 2012: | |||||||
Fair Value | Fair Value | ||||||
Hierarchy | |||||||
Marketable securities, December 31, 2013 | $ | -0- | Level 1 | ||||
Marketable securities, December 31, 2012 | $ | 30,000 | Level 1 | ||||
New Accounting Standards | |||||||
Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the accompanying financial statements. | |||||||
MARKETABLE_SECURITIES
MARKETABLE SECURITIES | 12 Months Ended |
Dec. 31, 2013 | |
MARKETABLE SECURITIES | ' |
MARKETABLE SECURITIES | ' |
NOTE 3: MARKETABLE SECURITIES | |
As of the years ended December 31, 2013 and 2012, the Company held - 0- and 150,000 shares of the common stock of Ecologic Transportation, Inc. with a fair value of $-0- and $30,000, respectively. A realized loss of $19,500 was recorded for the year ended December 31, 2013. A realized gain of $12,000 was recorded for the years ended December 31, 2012. | |
PROPERTY_PLANT_EQUIPMENT
PROPERTY, PLANT & EQUIPMENT | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
PROPERTY, PLANT & EQUIPMENT | ' | |||||||
PROPERTY, PLANT & EQUIPMENT | ' | |||||||
NOTE 4: PROPERTY, PLANT & EQUIPMENT | ||||||||
Property, plant and equipment consists of the following: | ||||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Computer & Peripherals | $ | 25,478 | $ | 25,478 | ||||
Accumulated Deprecation | (21,631 | ) | (18,435 | ) | ||||
Property Plant & Equipment, Net | $ | 3,847 | $ | 7,043 | ||||
Depreciation expense totaled $3,196 and $3,883 for the years ended December 31, 2013 and 2012, respectively. | ||||||||
INTANGIBLE_ASSETS
INTANGIBLE ASSETS | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
INTANGIBLE ASSETS | ' | |||||||
INTANGIBLE ASSETS | ' | |||||||
NOTE 5: INTANGIBLE ASSETS | ||||||||
Prior to December 31, 2013, patents, technology and other intangibles with contractual terms were generally amortized over their estimated useful lives of ten years. When certain events or changes in operating conditions occur, an impairment assessment is performed and lives of intangible assets with determinable lives may be adjusted. | ||||||||
Prior to any impairment adjustment, intangible assets consisted of the following: | ||||||||
December 30, | December 31, | |||||||
2013 | 2012 | |||||||
Patents | $ | 3,563,343 | $ | 3,553,651 | ||||
Accumulated Amortization | (489,398 | ) | (135,030 | ) | ||||
Intangible Assets, Net | $ | 3,073,945 | $ | 3,418,621 | ||||
Amortization expense totaled $354,368 and $135,030 for the year ended December 31, 2013 and 2012, respectively. |
RELATED_PARTY_TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2013 | |
RELATED PARTY TRANSACTIONS | ' |
RELATED PARTY TRANSACTIONS | ' |
NOTE 6: RELATED PARTY TRANSACTIONS | |
CMG | |
On March 31, 2010, CMG Holdings Group, Inc. (“CMG”) acquired the Company. In connection with the acquisition, the Company’s former stockholders retained rights to receive cash from the exploitation of its technology (the “Rights”) consisting of 50% of any cash received from income earned, settlements or judgments directly resulting from the Company’s patent strategy and a share of its net income for 2010, 2011 and 2012 from the exploitation of its technology. The Rights were then contributed to a newly formed Nevada corporation, AudioEye Acquisition Corporation (“AEAC”) in exchange for shares of AEAC. | |
On June 22, 2011, CMG entered into a Master Agreement with AEAC pursuant to which: (i) the stockholders of AEAC would acquire from the CMG 80% of the Company’s capital stock (the “Separation”) and (ii) CMG would distribute to its stockholders, in the form of a dividend, 5% of the Company’s capital stock (the “Spin-off”). Pursuant to the Master Agreement, AEAC was required to arrange for the release of senior secured notes (the “Senior Notes”) issued by CMG in an aggregate principal amount of $1,025,000, which CMG had been unable to service. On August 15, 2012, the Company, CMG and AEAC completed the Separation. In connection with the Separation, AEAC arranged for the release of CMG under the Senior Notes by payment to CMGO Investors LLC (“Investors”) the holder thereof of $700,000, the delivery of a secured promissory note in the principal amount of $425,000 and the issuance of 1,500,000 shares of the common stock of AEAC. On February 6, 2013, the note to Investors was paid in full. Payment consisted of cash payments of $200,000 of which $16,339 was interest and $183,661 was principal. The balance of the principal of $241,359 was repaid with the issuance to Investors of 1,998,402 common shares of the Company, which was 5.678562% of the outstanding shares on February 6, 2013. On January 29, 2013, the Securities and Exchange Commission declared effective the Company’s registration statement on Form S-1 with respect to 1,500,259 shares of its common stock to be issued in the Spin-off. On February 22, 2013, CMG completed the Spin-off. | |
In connection with the Separation, the Company entered into a Royalty Agreement with CMG. Pursuant to the Royalty Agreement, for a period of five years, the Company would pay to CMG 10% of cash received from income earned or settlements on judgments directly resulting from the Company’s patent enforcement and licensing strategy, whether received by it on any of its affiliates, net in either case of any direct costs or tax implications incurred in pursuit of such strategy as they relate to the patents described in the Master Agreement. Additionally, the Company entered into a Services Agreement with CMG whereby, without duplication to the amounts payable under the Royalty Agreement, for a period of 5 years, CMG will receive a commission of 7.5% of all revenues received by the Company after the Separation from all business, clients or other sources of revenue procured by CMG or its employees, officers or subsidiaries and directed to us and 10% of net revenues obtained from a specified customer. | |
On November 12, 2013, the Company and CMG terminated the Royalty Agreement. | |
On December 30, 2013, the Company completed the repurchase of 2,184,583 shares of its common stock owned by CMG which shares were transferred to the Company in January, 2014 and retired to treasury. In connection, with the repurchase, the Company paid CMG $573,022 and forgave a $50,000 payable from an affiliate of CMG. | |
AEAC | |
On March 22, 2013, the Company and AEAC entered into an Agreement and Plan of Merger (the “Merger Agreement”) pursuant to which AEAC would be merged with and into the Company (the “Merger”) with the Company being the surviving entity. Pursuant to the Merger Agreement, each share of AEAC common stock issued and outstanding immediately prior to the Merger effective date would be converted into .94134 share of the Company’s common stock and the outstanding convertible debentures of AEAC (the “AEAC Debentures”) in the aggregate principal amount of $1,400,200, together with accrued interest thereon, would be assumed by the Company and then exchanged for convertible debentures of the Company (the “AE Debentures”). | |
Effective March 25, 2013, the Merger was completed. In connection with the Merger, the stockholders of AEAC received on a pro rata basis the 24,004,143 shares of the Company’s common stock that were held by AEAC, and the former holders of the AEAC Debentures received an aggregate of 5,871,752 shares of the Company’s common stock pursuant to their conversion of all of the AE Debentures issued to replace the AEAC Debentures. The principal assets of AEAC were the Rights that had been contributed to AEAC by the former stockholders of the Company. As a result of the Merger, the Rights have been extinguished. | |
Nathaniel Bradley, President, Chief Executive Officer and Director | |
As of December 31, 2011, the Company had a note balance of $1,245,840 due to Mr. Bradley. | |
On August 31, 2012, the officer paid $50,000 of the Company’s accounts payable. As a result, the Company issued the officer a Convertible Promissory Note, which is payable within two years, accrues interest at 8% per annum, and is convertible into common stock of the Company at a price of $0.25 per share. | |
On November 27, 2012 and December 12, 2012, the officer loaned the Company $2,500 and $10,000, respectively. As a result, the Company issued the officer a Convertible Promissory Note, which is payable within two years, accrues interest at 8% per annum, and is convertible into common stock of the Company at a price of $0.25 per share. | |
The Company analyzed the convertible notes for derivative accounting consideration under FASB ASC 815-15 and FASB ASC 815-40. The Company determined the embedded conversion option in the convertible notes met the criteria for classification in stockholders equity under ASC 815-15 and ASC 815- 40 “Derivatives and Hedging”. In addition, the Company determined that the convertible notes did not contain a beneficial conversion feature under FASB ASC 470-20 “Debt with Conversion and Other Options”. | |
On December 5, 2012, the Company received a Notice to Convert from its president, Mr. Nathaniel Bradley, in which Mr. Bradley requested that 100% of his debt be converted into the Company’s common stock at a price of $0.25 per share. As a result, the debt in the amount of $1,296,715, which includes accrued interest in the amount of $875, was converted into 5,186,860 shares of the Company’s common stock, and the related Promissory Note was deemed paid in full. Accrued interest in the amount of $84,581 was considered forgiven due to this conversion. | |
As of December 31, 2012, related party loan totaled $10,000. | |
During the year ended December 31, 2013, the Company borrowed a total of $224,000, due on demand with a warrant to purchase 28,400 common shares, vesting immediately with a strike price of $0.40. The 28,400 common share warrant was valued at $6,901 on the date the note was granted using a closing price that day of $0.35 through $0.43, a strike price of $0.40, term of 5 years, volatility of 100%, dividends of 0% and a discount rate of 1.37% through 1.43%. The value of the of $6,901 is reflected as a discount which was then amortized to expense because the note is a demand note. In the same year, $199,000 of prinicpal balance and $25,000 acrued salary was converted to 746,667of the Company’s common stock along with a warrant to purchase 746,677 shares of the Company’s common stock. The warrant shall vest immediately with a strike price of $0.4 and expire in 2018. As of December 31, 2013, related party loan totaled $35,000. | |
As of December 31, 2013 and 2012, the Company owed $39,500 and $386,539 in accrued salary to Mr. Bradley. During 2013, the Company recognized additional of salary expense of which $461,539 was converted to warrant to purchase 1,831,783 shares of the Company’s common stock, $25,000 was converted to common stock as discussed above and $10,500 was exchanged for marketable securities the Company held as of December 31, 2012 which resulted a realized loss of $19,500 during the period of 2013. | |
Sean Bradley, Chief Technology Officer, Vice President, Secretary and Director | |
As of December 31, 2013 and 2012, the Company owed Sean Bradley $24,375 and $341,731 in accrued salary. During 2013, the Company recognized additional salary expense of which $399,648 was converted to a warrant to purchase 1,587,290 shares of the Company’s common stock. | |
Others | |
As of December 31, 2013 and 2012, the Company had accrued salary due to other officer of $29,375 and $101,148. During 2013, the Company recognized additional salary expense of which $161,564 was converted to a warrant to purchase 626,680 shares of the Company’s common stock. | |
As of December 31, 2013, there were $150,174 of accounts payable due to related party. | |
In summary, as of December 31, 2013 and 2012, the total balances of related party payable were $243,424 and $829,418, respectively. | |
As of December 31, 2013 and 2012, there were outstanding receivables of $82,250 and $16,125, respectively, for services performed for related parties. | |
For the year ended December 31, 2013 and 2012, there were revenues earned of $108,500 and $3,000, respectively, for services performed for related parties. | |
NOTES_PAYABLE
NOTES PAYABLE | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
NOTES PAYABLE | ' | |||||||
NOTES PAYABLE | ' | |||||||
NOTE 7: NOTES PAYABLE | ||||||||
As at December 31, 2012 and 2013, the Company has current and long term notes payable of $172,845 and $1,466,700 and $79,800 and $97,800, respectively as shown in the table below. | ||||||||
Notes and loans payable | December 31, 2013 | December 31, 2012 | ||||||
Short Term | ||||||||
Maryland TEDCO | $ | 24,000 | $ | 24,000 | ||||
Notes Payable (net of $1,155 discount) | 148,845 | — | ||||||
AudioEye Acquisition Corp Notes | — | 1,017,700 | ||||||
CMGO Investors, LLC | — | 425,000 | ||||||
Total | $ | 172,845 | $ | 1,466,700 | ||||
Long Term | ||||||||
Maryland TEDCO | $ | 79,800 | $ | 97,800 | ||||
Total | $ | 79,800 | $ | 97,800 | ||||
As of December 31, 2012, the Company had an outstanding loan to a third party in the amount of $74,900, which was originally issued during 2006 as part of an Investment Agreement. The loan was unsecured and bore interest at 25% per year for four years. The Company had accrued interest of $74,900, which was included in accounts payable and accrued expenses on the balance sheet. The note was in default until October 24, 2011, at which time the Company entered into a Termination and Release Agreement (“Release”) with the third party. The terms of the Release, among other things, terminated the Investment Agreement between the parties, and required the Company to issue a Promissory Note to the third-party in the combined amount of principal and accrued interest to date, for a total principal amount of $149,800. The note is interest free, and is payable in monthly installments of $2,000 beginning November 1, 2011. As of December 31, 2013 and 2012, the principal amount owing was $103,800 and $121,800, respectively, of which $24,000 and $24,000, respectively, has been recorded as the current portion of the note, and $79,800 and $97,800, respectively, as the long-term portion of the note, respectively. The Company has paid $18,000 and $24,000 in monthly installments for the year ended December 31, 2013 and 2012, respectively. | ||||||||
On August 15, 2012, the Company issued a Secured Promissory Note to CMGO Investors LLC, the agent for the former holders of CMG’s senior debt, in the amount of $425,000, related to the separation of the Company from CMG, which took place on August 17, 2012. The note bore interest at 8% per annum. Pursuant to an extension granted by the noteholder, the note was due on February 6, 2013. The noteholder had the option to convert the principal and interest into 10% of the Company’s total issued and outstanding common shares as of the date of the notice to convert, but in no event more than 6,000,000 shares. On February 6, 2013, the Secured Promissory Note was repaid in full. Payment consisted of cash payments of $200,000, of which $16,339 was interest and $183,661 was principal. The balance of the principal of $241,359 was repaid with the issuance of 1,998,402 common shares of the Company, which represented 5.678562% of the outstanding shares on February 6, 2013. | ||||||||
For the period ending December 31, 2012, AEAC borrowed $1,017,7000 which was evidenced by the issuance of AEAC Debentures. These debentures bore interest at 8% per annum and were due one year from the date of issuance. The debenture holders had the option to convert the principal and interest at an exercise price $0.25 per share. During the period ended March 31, 2013, AEAC borrowed an additional $382,500 under the same term. | ||||||||
In connection with the Merger that occurred March 25, 2013, the Company assumed the obligations under the AEAC debentures and issued new AE Debentures which in turn were converted by the holders thereof into an aggregate of 5,871,752 shares of the Company’s common stock. These shares were issued for the conversion of total principal of $1,400,200 and accrued interest of $67,732 on the former AE Debentures. | ||||||||
On August 3, 2013, the Company borrowed $150,000 with a coupon rate of 10%, due on September 10, 2013 with a warrant to purchase 20,000 common shares, vesting immediately with a strike price of $0.50. The 20,000 common share warrant was valued at $6,930 on August 3, 2013 using a closing price that day of $0.47, a strike price of $0.50, term of 5 years, volatility of 100%, dividends of 0%, and a discount rate of 1.36%. The value of the warrant of $6,930 is reflected as a discount to the note for a net amount of $143,070. For the period ended December 31, 2013, interest was accrued in the amount of $2,384 and $5,755 was recognzied as amortization expense. As of December 31, 2013, the note has a balance of $148,845, net of discount of $1,155. |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2013 | |
COMMITMENTS AND CONTINGENCIES | ' |
COMMITMENTS AND CONTINGENCIES | ' |
NOTE 8: COMMITMENTS AND CONTINGENCIES | |
The Company’s principal executive offices are located at 5210 E. Williams Circle, Fifth Floor, Tucson, Arizona 85711, consisting of approximately 6,003 square feet as of January 24, 2014. The Company’s office is leased for an aggregate amount of $12,927 per month. The Company’s total rent expense was approximately $38,388 and $30,165 under office leases for the years ended December 31, 2013 and 2012, respectively. | |
On August 7, 2013, the Company entered into agreements with the following executive officers: | |
Nathaniel Bradley. Pursuant to an Executive Employment Agreement, Nathaniel Bradley was employed as the Company’s Chief Executive Officer. The term of the Executive Employment Agreement is three years commencing August 7, 2013, subject to extension upon mutual agreement. He is to receive a base annual salary of $200,000 during the employment period. He is entitled to receive bonuses at the sole discretion of the Company’s board of directors or the compensation committee. Mr. Bradley is also entitled to equity awards under the Company’s incentive compensation plans. In connection with entry into the Executive Employment Agreement, the Company and Mr. Bradley terminated the existing employment agreement, dated April 1, 2010, between the Company and Mr. Bradley effective as of August 7, 2013. | |
Sean Bradley. Pursuant to an Executive Employment Agreement, Sean Bradley was employed as the Company’s Chief Technology Officer. The term of the Executive Employment Agreement is three years commencing August 7, 2013, subject to extension upon mutual agreement. He is to receive a base annual salary of $195,000 during the employment period. He is entitled to receive bonuses at the sole discretion of the Company’s board of directors or the compensation committee. Mr. Bradley is also entitled to equity awards under the Comoany’s incentive compensation plans. In connection with entry into the Executive Employment Agreement, the Company and Mr. Bradley terminated the existing employment agreement, dated April 1, 2010, between the Company and Mr. Bradley effective as of August 7, 2013. | |
James Crawford. Pursuant to an Executive Employment Agreement, James Crawford was employed as the Company’s Chief Operating Officer. The term of the Executive Employment Agreement is three years commencing August 7, 2013, subject to extension upon mutual agreement. He is to receive a base annual salary of $185,000 during the employment period. He is entitled to receive bonuses at the sole discretion of the Company’s board of directors or the compensation committee. Mr. Crawford is also entitled to equity awards under the Comoany’s incentive compensation plans. | |
Edward O’Donnell. Pursuant to an Executive Employment Agreement, Mr. O’Donnell was employed as the Company’s Chief Financial Officer. The term of the Executive Employment Agreement is two years commencing August 7, 2013, subject to extension upon mutual agreement. He is to receive a base annual salary of $165,000 during the employment period. He is entitled to receive bonuses at the sole discretion of the Company’s board of directors or the compensation committee. Mr. O’Donnell is also entitled to equity awards under the Company’s incentive compensation plan. | |
Constantine Potamianos. Pursuant to an Executive Employment Agreement, Constantine Potamianos was employed as the Company’s Chief Legal Officer and General Counsel. The term of the Executive Employment Agreement is two years commencing August 7, 2013, subject to extension upon mutual agreement. He is to receive a base annual salary of $150,000 during the employment period. He is entitled to receive bonuses at the sole discretion of the Company’s board of directors or the compensation committee. Mr. Potamianos is also entitled to equity awards under the Company’s incentive compensation plan. |
STOCKHOLDERS_EQUITY
STOCKHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2013 | |
STOCKHOLDERS' EQUITY | ' |
STOCKHOLDERS' EQUITY | ' |
NOTE 9: STOCKHOLDERS’ EQUITY | |
The total number of authorized shares of common stock that may be issued by the Company was 4,000,000 with a par value of $0.00001 per share. On August 17, 2012, the Company increased the total number of authorized shares of common stock to 100,000,000 shares, with a par value of $0.00001. | |
On August 17, 2012, in connection with the separation of the Company from CMG, the Company effectuated a forward split of its outstanding shares of common stock. As a result, each outstanding share of common stock was forward split into 11.78299032 shares of the Company’s common stock, resulting in a total number of shares issued of 30,005,185. | |
As a result of the acquisition of AEAC (see note 14), $3,123,136 has been recorded into additional paid in capital since the transaction was accounted as merger of entities under common control. Also during 2012, AEAC paid $20,000 of the Company’s accounts payable and forgave the debt. This amount has been recorded into paid in capital. | |
On December 5, 2012, the Company received a Notice to Convert from its president, Mr. Nathaniel Bradley, in which Mr. Bradley requested that 100% of his debt be converted into the Company’s common stock at a price of $0.25 per share. As a result, the debt in the amount of $1,296,715, which includes accrued interest in the amount of $875, was converted into 5,186,860 shares of the Company’s common stock on December 20, 2012, and the related Promissory Note was deemed paid in full. Accrued interest in the amount of $84,581 was considered forgiven due to this conversion. | |
On April 30, 2012, LVS agreed to sell its 50% membership interest in Empire to the Company for consideration of $10 and the sum of previous LVS capital contributions paid in cash to Empire. The non-controlling interest of $14,701 was then eliminated and Empire is now treated, as a 100% owned consolidated subsidiary. | |
During the year ended December 31, 2012, $11,309 was recognized was stock option expense. See note 11. | |
As of December 31, 2013 and December 31, 2012, the Company had 53,239,369 and 35,192,045 shares of common stock issued and outstanding, respectively. | |
On February 6, 2013, the Secured Promissory Note to CMGO Investors LLC was repaid in full. Payment consisted of cash payments of $200,000 of which $16,339 was interest and $183,661 was principal. The balance of the principal of $241,359 was repaid with the issuance of 1,998,402 common shares of the Company, which was 5.678562% of the outstanding shares on February 6, 2013. | |
In connection with the Merger that occurred March 22, 2013, the former holders of the AEAC Debentures received an aggregate of 5,871,752 shares of the Company’s common stock pursuant to their conversion of all of the AE Debentures issued to replace the AEAC Debentures totalling $1,400,200 of principal and $67,732 of interest. These shares were issued for the conversion of total principal and accrued interest on the former AE Debentures. | |
On April 5, 2013 the Company issued 200,000 shares of the Company’s common stock for services valued at $50,000. The shares were valued at the market price of the respective dates of issuance. | |
On September 10, 2013, the Company issued 142,500 common shares for the exercise of options and received proceeds of $37,188. | |
On October 10, 2013, the Company issued 42,250 common shares for the exercise of options and received proceeds of $10,562. | |
In the quarter ended June 30, 2013, pursuant to a private placement, the Company sold to a group of accredited investors 1,092,000 units for gross aggregate proceeds of $496,000 net of private placement cost of $39,100 and of which 100,000 of the units was for $50,000 of accounts payable to related party that was forgiven. Each unit consists of one share of the Company’s common stock and a three-year warrant to purchase one share of the Company’s common stock. The warrants included in the units have an exercise price of $0.50 per share. The purchase price of each unit was $0.50. On August 8, 2013, the Company issued a total of 1,092,000 shares of its common stock in connection with the private placement subscriptions received through June 30, 2013. As of September 30, 2013, warrants to purchase up to a total of 1,092,000 shares of the Company’s common stock were to be issued in connection with the sale of units through the private placement (the “Private Placement”. These warrants will not be issued until the final closing of the Private Placement. | |
On November 25, 2013, the Company conducted a final closing of the Private Placement pursuant to which an additional 50,000 units were sold to an affiliate of a director. Each unit consisted of one share of the Company’s common stock and a three-year warrant to purchase one share of the Company’s common stock. The warrants included in the units have an exercise price of $0.50 per share. The purchase price of each unit was $0.50 for a total of $25,000. | |
On December 23, 2013, the Company sold an aggregate of 10,088,336 units to 15 accredited investors for gross proceeds of $3,026,500 net of private placement cost of $276,408 in a separate private placement (the “Second Private Placement”). The units in the Second Private Placement consisted of 10,088,336 shares of the Company’s common stock and warrants to purchase an additional 10,088,336 shares of the Company’s common stock, which warrants include warrants to purchase 952,564 shares of the Company’s common stock issued to the placement agent in connection with their services. The warrants in the Second Private Placement are for a term of five years and have an exercise price of $0.40 per share. | |
During the year ended December 31, 2013, $199,000 of prinicpal balance and $25,000 acrued salary was converted to 746,667of the Company’s common stock along with warrant to purchase 746,677 shares of the Company’s common stock. See Note 6. | |
On December 30, 2013, the Company completed the repurchase of 2,184,583 shares of the Company’s common stock owned by CMG which shares were transferred to the Company in January, 2014 and retired to treasury. In connection, with the repurchase, the Company paid CMG $573,022 and forgave a $50,000 payable to the Company from an affiliate of CMG. | |
During the year ended December 31, 2013, 4,054,753 of the Company’s warrants were issued to convert $1,022,751 of accrued salary. See note 6 and 12. | |
During the year ended December 31, 2013, 41,872 of the Company’s warrants were issued to convert $51,000 of accounts payable. See note 12. | |
During the year ended December 31, 2013, $1,191,128 was recognized as stock option, warrant and PSU expense. See note 11, 12 and 13. | |
INCOME_TAXES
INCOME TAXES | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
INCOME TAXES | ' | |||||||
INCOME TAXES | ' | |||||||
NOTE 10: INCOME TAXES | ||||||||
The Company accounts for income taxes under ASC 740, “Income Taxes”. Temporary differences are differences between the tax basis of assets and liabilities and their reported amounts in the financial statements that will result in taxable or deductible amounts in future years. Under this method, deferred tax assets and liabilities are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. A valuation allowance is recorded when the ultimate realization of a deferred tax as The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are presented below: | ||||||||
Deferred tax assets: | December 31, | December 31, | ||||||
2013 | 2012 | |||||||
Net operating loss carry forwards | $ | 1,720,000 | $ | 1,170,000 | ||||
Less valuation allowance | (1,720,000 | ) | (1,170,000 | ) | ||||
Net deferred tax asset | $ | — | $ | — | ||||
At this time, the Company is unable to determine if it will be able to benefit from its deferred tax asset. There are limitations on the utilization of net operating loss carry forwards, including a requirement that losses be offset against future taxable income, if any. In addition, there are limitations imposed by certain transactions, which are deemed to be ownership changes. Accordingly, a valuation allowance has been established for the entire deferred tax asset. The approximate net operating loss carry forward was $5,071,000 and $3,440,000 as of December 31, 2013 and 2012, respectively and will start to expire in 2029. |
OPTIONS
OPTIONS | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
OPTIONS. | ' | |||||||||||||||
OPTIONS | ' | |||||||||||||||
NOTE 11: OPTIONS | ||||||||||||||||
As at December 31, 2012 and 2013, the Company has 2,820,000 and 4,485,250 options issued and outstanding. There were no options outstanding and no option activity prior to December 2012. | ||||||||||||||||
On December 19, 2012, the Company issued 2,820,000 options for the initial option grant. Prior to this issuance there had been no option grants. This tranche of options vest over 2 years at exercise price of $0.25 and expire on December 19, 2017. The options were valued using the Black-Scholes pricing model. Significant assumptions used in the valuation include expected term of 3.25 years, expected volatility of 250%, date of issue risk free interest rate of 0.39%, and expected dividend yield of 0%. The value on the grant date of the options was $687,953 and the option expense for December 31, 2013 and 2012 was determined to be $377,121 and $11,309. As of December 31, 2013, 184,750 options have been exercised from this tranche of options. | ||||||||||||||||
The Company issued 400,000 options on May 10, 2013, which vest 50% on grant date and 12.5% every 90 days thereafter, have an exercise price of $1.00 per share, and expire on May 9, 2016. The options were valued using the Black-Scholes pricing model. Significant assumptions used in the valuation include expected term of 1.42 years, expected volatility of 100%, risk free interest rate of 0.82%, and expected dividend yield of 0%. The value on the grant date of the options was $152,067 and the option expense for December 31, 2013 and 2012 was determined to be $124,987 and $0. As of December 31, 2013, no options have been exercised from this tranche of options. | ||||||||||||||||
On July 29, 2013, the Company issued 350,000 options, which vest 50% on July 29, 2014 and 50% on July 29, 2015, have an exercise price of $0.35 and expire on July 29, 2018. The options were valued using the Black-Scholes pricing model. Significant assumptions used in the valuation include expected term of 2.67 years, expected volatility of 100%, risk free interest rate of 0.82%, and expected dividend yield of 0%. The value on the grant date of the options was $72,311 and the option expense for December 31, 2013 and 2012 was determined to be $15,354 and $0. As of December 31, 2013, no options have been exercised from this tranche of options. | ||||||||||||||||
On August 20, 2013, the Company issued 300,000 options, which vest 50% in February 2014 and 50% in August 2014, have an exercise price of $0.40 and $0.50 and expire on August 20, 2018. The options were valued using the Black-Scholes pricing model. Significant assumptions used in the valuation include expected term of 2.88 years, expected volatility of 100%, risk free interest rate of 0.82%, and expected dividend yield of 0%. The value on the grant date of the options was $67,928 and the option expense for December 31, 2013 and 2012 was determined to be $24,752 and $0. As of December 31, 2013, no options have been exercised from this tranche of options. | ||||||||||||||||
On August 20, 2013, the Company issued 700,000 options, which vest 50% immediately and 12.5% every 90 days thereafter, have an exercise price of $0.50. Out of the 700,000 options, 100,000 expire on August 20, 2016 and the rest 600,000 expire on August 20, 2018. The options were valued using the Black-Scholes pricing model. Significant assumptions used in the valuation include expected term of 1.75 years for the options expiring in 2016 and expected term of 2.88 years for the options expiring in 2018, expected volatility of 100%, risk free interest rate of 0.82%, and expected dividend yield of 0%. The value on the grant date of the options was $147,441 and the option expense for December 31, 2013 and 2012 was determined to be $100,583 and $0. As of December 31, 2013, no options have been exercised from this tranche of options. | ||||||||||||||||
On December 13, 2013, the Company issued 100,000 options, which vest 50% immediately and 12.5% every 90 days thereafter, have an exercise price of $0.50 and expire on December 13, 2018. The options were valued using the Black-Scholes pricing model. Significant assumptions used in the valuation include expected term of 1.42 years, expected volatility of 100%, risk free interest rate of 0.82%, and expected dividend yield of 0%. The value on the grant date of the options was $11,180 and the option expense for December 31, 2013 and 2012 was determined to be $5,590 and $0. As of December 31, 2013, no options have been exercised from this tranche of options. | ||||||||||||||||
Number of | Wtd Avg. | |||||||||||||||
Shares | Exercise Price | |||||||||||||||
None outstanding at December 31, 2011 | — | — | ||||||||||||||
Granted | 2,820,000 | 0.25 | ||||||||||||||
Outstanding at December 31, 2012 | 2,820,000 | 0.25 | ||||||||||||||
Granted | 1,850,000 | $ | 0.57 | |||||||||||||
Exercised | 184,750 | 0.25 | ||||||||||||||
Outstanding at December 31, 2013 | 4,485,250 | $ | 0.38 | |||||||||||||
As of December 31, 2013 and 2012 the outstanding options had a weighted average remaining term and intrinsic value of 3.96 and 4.97 years and $99,070 and $0, respectively. | ||||||||||||||||
Outstanding and Exercisable Options | ||||||||||||||||
Average | Number of | Remaining | Exercise | Weighted | Intrinsic | |||||||||||
Exercise Price | Shares | Average | Price | Average | Value | |||||||||||
Contractual | times | Exercise | ||||||||||||||
Life | number of | Price | ||||||||||||||
(in years) | Shares | |||||||||||||||
$ | 0.25 | 4,485,250 | 3.96 | $ | 1,716,313 | $ | 0.38 | $ | 99,070 | |||||||
4,485,250 | $ | 1,716,313 | $ | 0.38 | $ | 99,070 | ||||||||||
The options were valued using the Black-Scholes pricing model. Significant assumptions used in the valuation include expected term of 1.42 through 3.25 years, expected volatility of 100% through 250%, date of issue risk free interest rates, and expected dividend yield of 0%. The expensed amount for options for December 31, 2013 and 2012 was determined to be $648,387 and $11,309. |
WARRANTS
WARRANTS | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
WARRANTS | ' | ||||||||||
WARRANTS | ' | ||||||||||
NOTE 12: WARRANTS | |||||||||||
On March 19, 2013, the Company’s board of directors approved the issuance of warrants to James Crawford, Nathaniel Bradley and Sean Bradley to purchase up to 464,593, 1,696,155 and 1,491,924, respectively, shares of the Company’s common stock in consideration for the release of an aggregate of $913,168 due to the issuees. The warrants have an issuance date of March 19, 2013, expire on March 19, 2018, have a strike price of $0.25 per share, and vest in 1/3 increments on the annual anniversaries of the issuance. The warrants to purchase up to an aggregate of 3,652,672 shares of common stock were valued at $913,168, which is the same amount as the related party payables forgiven. | |||||||||||
On May 10, 2013, the Company’s board of directors approved the issuance of a warrant to a third party to purchase up to 41,872 shares of the Company’s common stock in settlement of accounts payable. The warrant expires on May 10, 2018, has a strike price of $1.22 per share, and was vested upon grant. The warrant was valued at $51,000, which is the same amount as the accounts payable forgiven. | |||||||||||
On June 30, 2013, the Company’s board of directors approved the issuance of warrants to James Crawford, Nathaniel Bradley and Sean Bradley to purchase up to 38,333, 32,500 and 28,333, respectively, shares of the Company’s common stock in consideration for the release of an aggregate of $38,333 due to the issuees. The warrants have an issuance date of June 30, 2013, expire on June 30, 2016, have a strike price of $0.50 per share, and were vested upon grant. The warrants to purchase up to 99,166 an aggregate of shares of common stock were valued at $38,333, which is the same amount as the related party payables forgiven. | |||||||||||
In the 2013, pursuant to a private placement (the “Private Placement”), the Company sold 1,142,000 units to a group of accredited investors, with each unit consisting of one share of the Company’s common stock and a three-year warrant to purchase one share of the Company’s common stock. The warrants included in the units have an exercise price of $0.50 per share. The purchase price of each unit was $0.50. As of December 31, 2013, 1,042,000 shares of the Company’s common stock were issued and warrants to purchase up to a total of 1,042,000 shares of the Company’s common stock were to be issued in connection with the Private Placement. | |||||||||||
During 2013, the Company’s board of directors approved the issuance of warrants to multiple entities to purchase up to 405,000, in aggregate, shares of Company common stock as a part of the service contracts. The warrants expire in five years, have a strike price of $0.25 - $0.60 per share, and were vested upon grant. The warrants to purchase up to 405,000 an aggregate of shares of common stock were valued at $98,851 and was expensed during the year ended December 31, 2013. | |||||||||||
On August 3, 2013, the Company issued a warrant to purchase up to 20,000 shares of Company common stock to the issuer of the $150,000 note detailed in Note 7. The warrant has an issue date of August 3, 2013, expires on August 3, 2018, has a strike price of $0.50, and was vested upon grant. The warrant was valued at $6,930 and recorded as a debt discount to the note. | |||||||||||
During the November and December of 2013, the Company issued a warrant to purchase up to 28,400 shares of Company common stock to the issuer of the $224,000 note detailed in Note 6. The warrant will expire in five years, has a strike price of $0.40, and was vested upon grant. The warrant was valued at $6,901 and recorded as a debt discount to the note. | |||||||||||
On September 30, 2013, the Company’s board of directors approved the issuance of warrants to James Crawford, Nathaniel Bradley, Sean Bradley and Ted O’Donnell to purchase up to 95,394, 103,128, 67,033, and 28,360, respectively, shares of the Company’s common stock in consideration for the release of an aggregate of $71,250 due to the issuees. The warrants have an issuance date of September 30, 2013, expire on September 30, 2016, have a strike price of $0.39 per share, and were vested upon grant. The warrants to purchase up to 293,915 an aggregate of shares of common stock were valued at $71,250, which is the same amount as the related party payables forgiven. | |||||||||||
On November 16, 2013, the Company issued 1,300,000 warrants which vest immediately and have an exercise price of $0.01 and expire on December 13, 2018. The warrants were valued using the Black-Scholes pricing model. Significant assumptions used in the valuation include expected term of 5 years, expected volatility of 100%, risk free interest rate of 1.68%, and expected dividend yield of 0%. The value on the grant date of the options was $331,287 and the expense for December 31, 2013 and 2012 was determined to be $331,286 and $0. As of December 31, 2013, no options have been exercised from this tranche of options. | |||||||||||
On December 24, 2013, the Company sold 10,088,336 units as a part of a private placement to a group of accredited investors, with each unit consisting of one share of the Company’s common stock and and a three-year warrant to purchase one share of the Company’s common stock. The warrants included in the units have an exercise price of $0.40 per share. The purchase price of each unit was $0.30. As of December 24, 2013, 10,088,336 shares of the Company’s common stock and warrants to purchase up to a total of 10,888,336 shares of the Company’s common stock were to be issued in connection with the Private Placement. The Company received net cash of $2,750,092 from the sale of units. | |||||||||||
During the year ended December 31, 2013, a related party converted $199,000 of related party loan and $25,000 acrued salary 746,667of the Company common stock along with warrant to purchase 746,677 shares of the Company’s common stock. The warrant shall vest immediately with s strike price of $0.4 and expire in 2018. | |||||||||||
There was no warrant activity before 2013. Below is a table summarizing the Company’s outstanding warrants as of December 31, 2012 and December 31, 2013: | |||||||||||
Wtd Avg. | |||||||||||
Number of | Wtd Avg. | Remaining | Intrinsic | ||||||||
Shares | Exercise Price | Term | Value | ||||||||
None outstanding at December 31, 2012 | — | — | — | — | |||||||
Granted | 18,770,591 | 0.35 | 4.62 | $ | 416,000 | ||||||
Outstanding at December 31, 2013 | 18,770,591 | 0.35 | 4.62 | — | |||||||
The warrants were valued using the Black-Scholes pricing model. Significant assumptions used in the valuation include expected term of 1.5 to 5.0 years, expected volatility of 100% to 250%, risk free interest rate of 0.82% to 1.68%, and expected dividend yield of 0%. | |||||||||||
For the year ended December 31, 2013 and 2012, the Company has incurred warrants based expense of $430,138 and $0. | |||||||||||
PERFORMANCE_SHARE_UNITS
PERFORMANCE SHARE UNITS | 12 Months Ended |
Dec. 31, 2013 | |
PERFORMANCE SHARE UNITS | ' |
PERFORMANCE SHARE UNITS | ' |
NOTE 13: PERFORMANCE SHARE UNITS | |
On August 7, 2013, the Company entered into Performance Share Unit Agreements under the AudioEye, Inc. 2012 Incentive Compensation Plan with Nathaniel Bradley, Sean Bradley and James Crawford: | |
· Nathaniel Bradley. Mr. Bradley was granted an award of up to an aggregate of 200,000 Performance Share Units (“PSUs”), subject to increase of up to a total of 400,000 PSUs over a three-year period. Each PSU represents the right to receive one share of the Company’s common stock. The number of PSUs for a performance period will be determined by the level of achievement of performance goals in accordance with the terms and provisions of the Performance Share Unit Agreement. | |
· Sean Bradley. Mr. Bradley was granted an award of up to an aggregate of 200,000 PSUs, subject to increase of up to a total of 300,000 PSUs over a three-year period. Each PSU represents the right to receive one share of the Company’s common stock. The number of PSUs for a performance period will be determined by the level of achievement of performance goals in accordance with the terms and provisions of the Performance Share Unit Agreement. | |
· James Crawford. Mr. Crawford was granted an award of up to an aggregate of 200,000 PSUs, subject to increase of up to a total of 300,000 PSUs over a three-year period. Each PSU represents the right to receive one share of the Company’s common stock. The number of PSUs for a performance period will be determined by the level of achievement of performance goals in accordance with the terms and provisions of the Performance Share Unit Agreement. | |
The Company estimates that 100% of the PSUs or 1,000,000 incentive shares will be issued. The closing stock price on the date of the agreements on August 7, 2013 was $0.45. Total PSUs expense of $450,000 will be amortized over the performance period from grant through March 31, 2016. | |
For the year ending December 31, 2013, the Company has incurred performance share unit based expense of $112,603 and has additional expense to be amortized of $337,397 through the first quarter of 2016. |
ACQUISITION_OF_AUDIOEYE_INC_BY
ACQUISITION OF AUDIOEYE, INC. BY AUDIOEYE ACQUISITION CORPORATION | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
ACQUISITION OF AUDIOEYE, INC. BY AUDIOEYE ACQUISITION CORPORATION | ' | |||||||
ACQUISITION OF AUDIOEYE, INC. BY AUDIOEYE ACQUISITION CORPORATION | ' | |||||||
NOTE 14: ACQUISITION OF AUDIOEYE, INC. BY AUDIOEYE ACQUISITION CORPORATION | ||||||||
On August 17, 2012 AEAC acquired 80% of AudioEye , Inc, for $1,125,000 and 1,500,000 shares of AEAC common stock with a fair value of $375,000. | ||||||||
On August 17, 2012, the Company determined the fair value AudioEye’s patents to be $3,551,814. The following table sets forth the purchase price allocation for the acquisition of AudioEye, Inc. as of August 17, 2012: | ||||||||
Purchase Price Allocation | ||||||||
Purchase Price: Cash | $ | 1,125,000 | ||||||
1,500,000 shares of AEAC stock | 375,000 | $ | 1,500,000 | |||||
Less: Net Assets (deficit) | 2,752,342 | * | ||||||
Less: Identifiable Intangibles - Patents | (3,551,814 | ) | ||||||
Goodwill | $ | 700,528 | ||||||
Net Assets (deficit) | ||||||||
Book Value | ||||||||
at 08/17/12 | ||||||||
Current Assets | $ | 109,521 | ||||||
Property, Plant & Equipment, net | 7,688 | |||||||
Patents | — | |||||||
Current Liabilities | (1,517,724 | ) | ||||||
L/T Liabilities | (1,351,827 | ) | ||||||
Contingent Liabilities (Note 2) | — | |||||||
Net Assets (deficit) | $ | (2,752,342 | )* | |||||
In accordance with ASC 805, the Company has accounted for the combination using the Acquisition Method for the purpose of allocating the purchase price and determining goodwill. The fair value of the Company’s current tangible assets, property and equipment and liabilities approximated book value on the date of the acquisition. Therefore no adjustment has been made to the book value of the Company’s existing tangible assets and liabilities. The Company has determined that the value of goodwill is $700,528, based upon the Company’s enterprise allocation, less the Company’s net assets at the time of purchase, less any identifiable intangible assets, and is comprised of the expected synergies and intangible assets that do not qualify for separate recognition. While the Company uses its best estimates and assumptions as part of the purchase price allocation process to value net assets as of the Separation date of August 17, 2012, the purchase price allocation could change during the measurement period (not to exceed one year) if new information is obtained about facts and circumstances that existed as of the Separation date that, if known, would have resulted in the recognition of additional, or change in existing, assets and liabilities as of that date. | ||||||||
The Company has identified its patents as qualifying for separate recognition, in accordance with ASC 820. In determining the fair market value associated with the patents, the Company used the Income Method. Inasmuch as the Company has previously determined that there existed an impairment of the patent based upon an analysis utilizing the Company’s historical cash flows, it was necessary for the Company to consider any identifiable future cash flows that were reliably estimable at the date of Separation. The Company has determined that the only identifiable revenue stream for future cash flows directly related to the patents at the date of the Separation are those related to the licensing of its technology to the US Government, more fully described below. All other potential revenue is highly speculative, and/or not directly related to the patents at the date of the Separation. Based on the analysis performed, the Company determined the fair value of the patents on the date of separation to be $3,551,814. |
MERGER_OF_AUDIOEYE_INC_AND_AUD
MERGER OF AUDIOEYE, INC. AND AUDIOEYE ACQUISITION CORPORATION | 12 Months Ended | |||
Dec. 31, 2013 | ||||
MERGER OF AUDIOEYE, INC. AND AUDIOEYE ACQUISITION CORPORATION | ' | |||
MERGER OF AUDIOEYE, INC. AND AUDIOEYE ACQUISITION CORPORATION | ' | |||
NOTE 15: MERGER OF AUDIOEYE, INC. AND AUDIOEYE ACQUISITION CORPORATION | ||||
On March 22, 2013, the Company and AEAC entered into the Merger Agreement. Pursuant to the Merger Agreement, each share of AEAC common stock issued and outstanding immediately prior to the Merger effective date would be converted into .94134 share of the Company’s common stock and the outstanding convertible debentures of AEAC (the “AEAC Debentures”) in the aggregate principal amount of $1,400,200, together with accrued interest thereon of $67,732, would be assumed by the Company and then exchanged for convertible debentures of the Company (the “AE Debentures”). Effective March 25, 2013, the Merger was completed. In connection with the Merger, the stockholders of AEAC received on a pro rata basis the 24,004,143 shares of the Company’s common stock that were held by AEAC, and the former holders of the AEAC Debentures received an aggregate of 5,871,752 shares of the Company’s common stock pursuant to their conversion of all of the AE Debentures issued to replace the AEAC Debentures. | ||||
As a result of the merger, AEAC is now a wholly owned subsidiary of AudioEye, Inc. This transaction was accounted for as a combination of entities under common control under ASC 805-10-15. Accordingly, the historical financial statements have been adjusted retroactively assuming the transaction occurred on January 1, 2012. The Company recorded the following net assets after elimination of intercompany receivables and payables between AudioEye, Inc.: | ||||
Assets | ||||
Cash | 4,593 | |||
Intangible Assets | 3,551,814 | |||
Goodwill | 700,528 | |||
Total Assets | 4,256,935 | |||
Liabilities | ||||
Accounts payable and accrued expenses | 117,162 | |||
Net Assets | 4,139,773 | |||
CONCENTRATIONS
CONCENTRATIONS | 12 Months Ended |
Dec. 31, 2013 | |
CONCENTRATIONS | ' |
CONCENTRATIONS | ' |
NOTE 16: CONCENTRATIONS | |
During the year ended December 31, 2013, the Company had two customers that each comprised approximately 70% and 10% of total revenues, respectively. During the year ended December 31, 2012 one of these customers comprised approximately 58% of total revenues. | |
SUBSEQUENT_EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2013 | |
SUBSEQUENT EVENTS | ' |
SUBSEQUENT EVENTS | ' |
NOTE 17: SUBSEQUENT EVENTS | |
Effective January 27, 2014, the Company entered into agreements with Paul Arena. Under an Executive Employment Agreement dated as of January 27, 2014 (the “Agreement”), Mr. Arena will have direct responsibility working in conjunction with the Company’s Chief Executive Officer, over operations, sales marketing, financial accounting and SEC reporting, operational budgeting, sales costing analysis, billing and auditor interfacing. The initial term of Mr. Arena’s employment is two years. Mr. Arena’s base salary is $275,000 per year. Mr. Arena is to receive a signing bonus of $35,000 and is entitled to a quarterly bonus of up to $50,000 based on recognized revenues for the applicable quarter and additional bonuses at the discretion of the Company’s board of directors or compensation committee. Mr. Arena has been granted five year warrants to purchase 250,000 shares of the Company’s common stock at an exercise price of $0.40 per share and stock options to purchase 1,500,000 shares at an exercise price of $0.40 per share subject to vesting as set forth in the Agreement. Pursuant to a separate Performance Share Unit Agreement dated as of January 27, 2014 (the “PSU Agreement”), the Company granted to Mr. Arena an award of up to 3,000,000 PSUs. Each PSU represents the right to receive one share of common stock. The number of PSUs that Mr. Arena actually earns will be determined by the level of achievement of the performance goals set forth in the PSU Agreement. | |
On January 27, 2014 the Company issued 44,307 shares of common stock and a five-year warrant to purchase 44,307 shares of common stock with a strike price of $0.40 for payment for services. | |
On January 30, 2014, the Company sold an aggregate of 666,667 units to 2 accredited investors for gross proceeds of $200,000 in a separate private placement (the “Second Private Placement”). The units in the Second Private Placement consisted of 666,667 shares of the Company’s common stock and warrants to purchase an additional 666,667 shares of the Company’s common stock. The warrants in the Second Private Placement are for a term of five years and have an exercise price of $0.40 per share. | |
The Company registered the resale of a maximum of 26,286,836 shares of common stock under a registration statement, which was declared effective on February 11, 2014. | |
Effective March 3, 2014, Ernest W. Purcell was elected to the Company’s board of directors to fill a vacancy on the board as a result of the resignation of Craig Columbus, which was also effective March 3, 2014. Pursuant to his appointment, Mr. Purcell has been granted stock options to purchase 250,000 shares of common stock at an exercise price of $0.40 per share. | |
Effective March 5, 2014, stockholders holding a majority of the Company’s outstanding shares of common stock (i) approved the AudioEye, Inc. 2014 Incentive Compensation Plan, (ii) granted authority to the Company’s Chief Executive Officer to file a Certificate of Amendment to the Certificate of Incorporation to increase the authorized number of shares of Company common stock to 250,000,000 from 100,000,000 and (iii) granted authority to the Company’s Chief Executive Officer to file a Certificate of Amendment to the Certificate of Incorporation prior to the Company’s listing on a national market or exchange, and in connection with meeting the applicable listing requirements of such national market or exchange, to implement a reverse stock split of the outstanding shares of common stock on the basis of one post-reverse split share for up to every ten pre-reverse split shares, with the exact ratio to be determined by the Chief Executive Officer. | |
On March 24, 2014, the Company’s board of directors approved the issuance of a warrant to a third party to purchase up to 1,000,000 shares of the Company’s common stock in connection with services. The warrant has an issuance date of March 24, 2014, expires on March 24, 2017, has a strike price of $0.40 per share, and vests as follows: the warrant becomes exercisable for one share for every $10 of gross sales by the Company during the 12-month period immediately following the date of the warrant to customers introduced by the holder’s affiliate. | |
On March 24, 2014, the Company’s board of directors approved the grant of stock options to purchase 2,577,100 shares at an average exercise price of $0.45 per share under the AudioEye, Inc. 2013 Incentive Compensation Plan and the AudioEye, Inc. 2014 Incentive Compensation Plan. | |
On March 27, 2014, the Company filed a Certificate of Amendment to the Certificate of Incorporation increasing the authorized number of shares of Company common stock to 250,000,000 from 100,000,000. | |
Through March 31, 2014, the Company has issued 100,000 shares of common stock for services and 1,300,000 shares of common pursuant to exercise of warrants for a total proceed of $13,000. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended | ||||||
Dec. 31, 2013 | |||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | ||||||
Basis of Presentation | ' | ||||||
Basis of Presentation | |||||||
This summary of significant accounting policies is presented to assist in understanding the Company’s financial statements. These accounting policies conform to accounting principles, generally accepted in the United States of America, and have been consistently applied in the preparation of the financial statements. | |||||||
Principles of Consolidation and Non-Controlling Interest | ' | ||||||
Principles of Consolidation and Non-Controlling Interest | |||||||
The consolidated financial statements include the accounts of the Company and its subsidiary, Empire Technologies, LLC (“Empire”). All significant inter-company accounts and transactions have been eliminated. In October 2010, the Company formed Empire as part of a joint venture with LVS Health Innovations, Inc. (“LVS”) whereby the Company owned 50% of Empire. Empire is considered a variable interest entity as defined by ASC 805-10 “Business Combinations” and the primary beneficiary of Empire as defined by ASC 805-10 and therefore consolidates the accounts of Empire for the year ending December 31, 2011. On April 30, 2012, LVS agreed to sell its 50% membership interest in Empire to the Company for consideration of $10 and the sum of previous LVS capital contributions paid in cash to Empire. The non-controlling interest was then eliminated and Empire is now treated as a 100% owned consolidated subsidiary. | |||||||
During the year ended December 31, 2013 and 2012, Empire had no activity. Empire had no assets or liabilities as of December 31, 2013 and December 31, 2012. | |||||||
The Company acquired 19.5 % of Couponicate for a nominal cost in the year ended December 31, 2012. The entity has no assets or liabilities and has no net income or loss. | |||||||
Use of Estimates | ' | ||||||
Use of Estimates | |||||||
The preparation of financial statements, in conformity with generally accepted accounting principles in the United States of America, requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, disclosures of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. | |||||||
Research and technology expenses | ' | ||||||
Research and technology expenses | |||||||
Research and technology expenses are expensed in the period costs are incurred. For the year ended December 31, 2013, research and technology expenses totaled $56,515. | |||||||
Revenue Recognition | ' | ||||||
Revenue Recognition | |||||||
Revenue is recognized when all applicable recognition criteria have been met, which generally include (a) persuasive evidence of an existing arrangement; (b) fixed or determinable price; (c) delivery has occurred or service has been rendered; and (d) collectability of the sales price is reasonably assured. For software and technology development contracts the company recognizes revenues on a percentage of completion method based upon several factors including but not limited to (a) estimate of total hours and milestones to complete; (b) total hours completed; (c) delivery of services rendered; (d) change in estimates; and (e) collectability of the contract. | |||||||
The Company had two major customers generate 81% and 81% of its revenue in the fiscal years ended December 31, 2013 and 2012. | |||||||
Deferred Revenue | ' | ||||||
Deferred Revenue | |||||||
Revenue is recognized when services are performed and/or the project is completed. Certain contracts contain payment terms of 2-3 installments, which become due upon the completion of various stages of the project or service. | |||||||
The Company evaluates contracts upon receipt of installment payments to determine if the project and/or service has been completed. In the event an installment payment is received prior to the full completion of the contracted project or service, it is held as deferred revenue until the completion of the project and/or service. | |||||||
Certain website hosting contracts are prepared and invoiced on an annual basis. Any funds received for hosting services not provided yet are held in deferred revenue, and are recorded as revenue is earned. | |||||||
Fiscal Year End | ' | ||||||
Fiscal Year End | |||||||
The Company has a fiscal year ending on December 31. | |||||||
Cash and Cash Equivalents | ' | ||||||
Cash and Cash Equivalents | |||||||
The Company considers all highly liquid investments with maturities of three months or less at the time of purchase to be cash equivalents. | |||||||
Marketable Securities | ' | ||||||
Marketable Securities | |||||||
Marketable securities are classified as trading and consist of common stock holdings of publicly traded companies. These securities are marked to market at the end of each reporting period based on the closing price of the security at each balance sheet date. Changes in fair value are recorded as unrealized gains or losses in the consolidated statement of operations in accordance with ASC 320. | |||||||
Allowance for Doubtful Accounts | ' | ||||||
Allowance for Doubtful Accounts | |||||||
The Company establishes an allowance for bad debts through a review of several factors including historical collection experience, current aging status of the customer accounts, and financial condition of the Company’s customers. The Company does not generally require collateral for its accounts receivable. There was an allowance for doubtful accounts of $0 and $102,000 as of December 31, 2013 and 2012, respectively. | |||||||
Property, Plant and Equipment | ' | ||||||
Property, Plant and Equipment | |||||||
Property and equipment are carried at the cost of acquisition or construction and depreciated over the estimated useful lives of the assets. Costs associated with repairs and maintenance are expensed as incurred. Costs associated with improvements which extend the life, increase the capacity or improve the efficiency of the Company’s property and equipment are capitalized and depreciated over the remaining life of the related asset. Gains and losses on dispositions of equipment are reflected in operations. Depreciation is provided using the straight-line method over the estimated useful lives of the assets, which are 5 to 7 years. | |||||||
Goodwill, Intangible Assets, and Long-lived | ' | ||||||
Goodwill, Intangible Assets, and Long-lived | |||||||
Goodwill is carried at cost and is not amortized. The Company tests goodwill for impairment on an annual basis at the end of each fiscal year, relying on a number of factors including operating results, business plans, economic projections, anticipated future cash flows and marketplace data. Company management uses its judgment in assessing whether goodwill has become impaired between annual impairment tests according to specifications set forth in ASC 350. The Company completed an evaluation of goodwill base on qualitative assessment at December 31, 2013 and determined that there was no impairment. | |||||||
The fair value of the Company’s reporting unit is dependent upon the Company’s estimate of future cash flows and other factors. The Company’s estimates of future cash flows include assumptions concerning future operating performance and economic conditions and may differ from actual future cash flows. Estimated future cash flows are adjusted by an appropriate discount rate derived from the Company’s market capitalization plus a suitable control premium at date of the evaluation. The financial and credit market volatility directly impacts the Company’s fair value measurement through the Company’s weighted average cost of capital that the Company uses to determine its discount rate and through the Company’s stock price that the Company uses to determine its market capitalization. Therefore, changes in the stock price may also affect the amount of impairment recorded. Market capitalization is determined by multiplying the shares outstanding on the assessment date by the average market price of the Company’s common stock over a 30- day period before each assessment date. The Company’s uses this 30-day duration to consider inherent market fluctuations that may affect any individual closing price. The Company believes that its market capitalization alone does not fully capture the fair value of its business as a whole, or the substantial value that an acquirer would obtain from its ability to obtain control of the Company’s business. As such, in determining fair value, the Company adds a control premium to its market capitalization. To estimate the control premium, the Company considered its unique competitive advantages that would likely provide synergies to a market participant. In addition, the Company considered external market factors, which it believes, contributed to the decline and volatility in the Company’s stock price that did not reflect the Company’s underlying fair value. | |||||||
The Company recognizes an acquired intangible asset apart from goodwill whenever the intangible asset arises from contractual or other legal rights, or when it can be separated or divided from the acquired entity and sold, transferred, licensed, rented or exchanged, either individually or in combination with a related contract, asset or liability. Such intangibles are amortized over their useful lives. Impairment losses are recognized if the carrying amount of an intangible asset subject to amortization is not recoverable from expected future cash flows and its carrying amount exceeds its fair value. | |||||||
The Company reviews its long-lived assets, including property and equipment, identifiable intangibles, and goodwill annually or whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. To determine recoverability of its long-lived assets, the Company evaluates the probability that future undiscounted net cash flows will be less than the carrying amount of the assets. | |||||||
Impairment of Long-Lived Assets | ' | ||||||
Impairment of Long-Lived Assets | |||||||
The Company’s long-lived assets, including intangibles, are reviewed for impairment whenever events or changes in circumstances indicate that the historical-cost carrying value of an asset may no longer be appropriate. The Company assesses recoverability of the asset by comparing the undiscounted future net cash flows expected to result from the asset to its carrying value. If the carrying value exceeds the undiscounted future net cash flows of the asset, an impairment loss is measured and recognized. An impairment loss is measured as the difference between the net book value and the fair value of the long-lived asset. | |||||||
Patents were evaluated for impairment and no impairment losses were incurred during the years ended December 31, 2013 and 2012, respectively. | |||||||
Equity-Based Payments | ' | ||||||
Equity-Based Payments | |||||||
The Company accounts for equity instruments issued to non-employees in accordance with the provisions of ASC 505-50, “Equity-Based Payments to Non-Employees”, which requires that such equity instruments are recorded at their fair value on the measurement date, with the measurement of such compensation being subject to periodic adjustment as the underlying equity instruments vest. | |||||||
The Company account for equity instruments issued to employees in accordance with ASC 718 “Stock Compensation”. Under this guidance, stock compensation expense is measured at the grant date, based on the fair value of the award, and is recognized as an expense over the estimated service period (generally the vesting period) on the straight-line attribute method. | |||||||
Income Taxes | ' | ||||||
Income Taxes | |||||||
Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. These assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which the temporary differences are expected to reverse. | |||||||
The Company has net operating loss carryforwards available to reduce future taxable income. Future tax benefits for these net operating loss carryforwards are recognized to the extent that realization of these benefits is considered more likely than not. To the extent that the Company will not realize a future tax benefit, a valuation allowance is established. | |||||||
Earnings (Loss) Per Share | ' | ||||||
Earnings (Loss) Per Share | |||||||
Basic earnings (loss) per share are computed by dividing net income, or loss, by the weighted average number of shares of common stock outstanding for the period. Diluted earnings (loss) per share and basic earnings (loss) per share are not included in the net loss per share computation until the Company has Net Income. Diluted loss per share including the dilutive effects of common stock equivalents on an “as if converted” basis would reduce the loss per share and thereby be antidilutive. | |||||||
Financial instruments | ' | ||||||
Financial instruments | |||||||
The carrying amount of the Company’s financial instruments, consisting of cash equivalents, short-term investments, account and notes receivable, accounts and notes payable, short-term borrowings and certain other liabilities, approximate their fair value due to their relatively short maturities. The carrying amount of the Company’s long-term debt approximates fair value since the stated rate of interest approximates a market rate of interest. | |||||||
Fair Value Measurements | ' | ||||||
Fair Value Measurements | |||||||
Fair value is an estimate of the exit price, representing the amount that would be received to, sell an asset or paid to transfer a liability in an orderly transaction between market participants (i.e., the exit price at the measurement date). Fair value measurements are not adjusted for transaction cost. Fair value measurement under generally accepted accounting principles provides for use of a fair value hierarchy that prioritizes inputs to valuation techniques used to measure fair value into three levels: | |||||||
Level 1: Unadjusted quoted prices in active markets for identical assets or liabilities | |||||||
Level 2: Inputs other than quoted market prices that are observable, either directly or indirectly, and reasonably available. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability and are developed based on market data obtained from sources independent of the Company. | |||||||
Level 3: Unobservable inputs reflect the assumptions that the Company develops based on available information about what market participants would use in valuing the asset or liability. | |||||||
An asset or liability’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Availability of observable inputs can vary and is affected by a variety of factors. The Company uses judgment in determining fair value of assets and liabilities and Level 3 assets and liabilities involve greater judgment than Level 1 and Level 2 assets or liabilities. | |||||||
The following are the Company’s marketable securities as of December 31, 2013 and 2012: | |||||||
Fair Value | Fair Value | ||||||
Hierarchy | |||||||
Marketable securities, December 31, 2013 | $ | -0- | Level 1 | ||||
Marketable securities, December 31, 2012 | $ | 30,000 | Level 1 | ||||
New Accounting Standards | ' | ||||||
New Accounting Standards | |||||||
Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the accompanying financial statements. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended | ||||||
Dec. 31, 2013 | |||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | ||||||
Schedule of fair value of marketable securities | ' | ||||||
Fair Value | Fair Value | ||||||
Hierarchy | |||||||
Marketable securities, December 31, 2013 | $ | -0- | Level 1 | ||||
Marketable securities, December 31, 2012 | $ | 30,000 | Level 1 |
PROPERTY_PLANT_EQUIPMENT_Table
PROPERTY, PLANT & EQUIPMENT (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
PROPERTY, PLANT & EQUIPMENT | ' | |||||||
Schedule of property, plant and equipment | ' | |||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Computer & Peripherals | $ | 25,478 | $ | 25,478 | ||||
Accumulated Deprecation | (21,631 | ) | (18,435 | ) | ||||
Property Plant & Equipment, Net | $ | 3,847 | $ | 7,043 |
INTANGIBLE_ASSETS_Tables
INTANGIBLE ASSETS (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
INTANGIBLE ASSETS | ' | |||||||
Schedule of intangible assets | ' | |||||||
December 30, | December 31, | |||||||
2013 | 2012 | |||||||
Patents | $ | 3,563,343 | $ | 3,553,651 | ||||
Accumulated Amortization | (489,398 | ) | (135,030 | ) | ||||
Intangible Assets, Net | $ | 3,073,945 | $ | 3,418,621 |
NOTES_PAYABLE_Tables
NOTES PAYABLE (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
NOTES PAYABLE | ' | |||||||
Schedule of current and long term notes payable | ' | |||||||
Notes and loans payable | December 31, 2013 | December 31, 2012 | ||||||
Short Term | ||||||||
Maryland TEDCO | $ | 24,000 | $ | 24,000 | ||||
Notes Payable (net of $1,155 discount) | 148,845 | — | ||||||
AudioEye Acquisition Corp Notes | — | 1,017,700 | ||||||
CMGO Investors, LLC | — | 425,000 | ||||||
Total | $ | 172,845 | $ | 1,466,700 | ||||
Long Term | ||||||||
Maryland TEDCO | $ | 79,800 | $ | 97,800 | ||||
Total | $ | 79,800 | $ | 97,800 |
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
INCOME TAXES | ' | |||||||
Schedule of deferred tax assets and deferred tax liabilities | ' | |||||||
Deferred tax assets: | December 31, | December 31, | ||||||
2013 | 2012 | |||||||
Net operating loss carry forwards | $ | 1,720,000 | $ | 1,170,000 | ||||
Less valuation allowance | (1,720,000 | ) | (1,170,000 | ) | ||||
Net deferred tax asset | $ | — | $ | — |
OPTIONS_Tables
OPTIONS (Tables) | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
OPTIONS. | ' | |||||||||||||||
Summary of the Company's outstanding options | ' | |||||||||||||||
Number of | Wtd Avg. | |||||||||||||||
Shares | Exercise Price | |||||||||||||||
None outstanding at December 31, 2011 | — | — | ||||||||||||||
Granted | 2,820,000 | 0.25 | ||||||||||||||
Outstanding at December 31, 2012 | 2,820,000 | 0.25 | ||||||||||||||
Granted | 1,850,000 | $ | 0.57 | |||||||||||||
Exercised | 184,750 | 0.25 | ||||||||||||||
Outstanding at December 31, 2013 | 4,485,250 | $ | 0.38 | |||||||||||||
Summary of the Company's outstanding and exercisable options | ' | |||||||||||||||
Outstanding and Exercisable Options | ||||||||||||||||
Average | Number of | Remaining | Exercise | Weighted | Intrinsic | |||||||||||
Exercise Price | Shares | Average | Price | Average | Value | |||||||||||
Contractual | times | Exercise | ||||||||||||||
Life | number of | Price | ||||||||||||||
(in years) | Shares | |||||||||||||||
$ | 0.25 | 4,485,250 | 3.96 | $ | 1,716,313 | $ | 0.38 | $ | 99,070 | |||||||
4,485,250 | $ | 1,716,313 | $ | 0.38 | $ | 99,070 | ||||||||||
WARRANTS_Tables
WARRANTS (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
WARRANTS | ' | ||||||||||
Summary of the Company's outstanding warrants | ' | ||||||||||
Wtd Avg. | |||||||||||
Number of | Wtd Avg. | Remaining | Intrinsic | ||||||||
Shares | Exercise Price | Term | Value | ||||||||
None outstanding at December 31, 2012 | — | — | — | — | |||||||
Granted | 18,770,591 | 0.35 | 4.62 | $ | 416,000 | ||||||
Outstanding at December 31, 2013 | 18,770,591 | 0.35 | 4.62 | — | |||||||
ACQUISITION_OF_AUDIOEYE_INC_BY1
ACQUISITION OF AUDIOEYE, INC. BY AUDIOEYE ACQUISITION CORPORATION (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
ACQUISITION OF AUDIOEYE, INC. BY AUDIOEYE ACQUISITION CORPORATION | ' | |||||||
Schedule of purchase price allocation | ' | |||||||
Purchase Price Allocation | ||||||||
Purchase Price: Cash | $ | 1,125,000 | ||||||
1,500,000 shares of AEAC stock | 375,000 | $ | 1,500,000 | |||||
Less: Net Assets (deficit) | 2,752,342 | * | ||||||
Less: Identifiable Intangibles - Patents | (3,551,814 | ) | ||||||
Goodwill | $ | 700,528 | ||||||
Schedule of net asset (deficit) acquired in acquisition | ' | |||||||
Net Assets (deficit) | ||||||||
Book Value | ||||||||
at 08/17/12 | ||||||||
Current Assets | $ | 109,521 | ||||||
Property, Plant & Equipment, net | 7,688 | |||||||
Patents | — | |||||||
Current Liabilities | (1,517,724 | ) | ||||||
L/T Liabilities | (1,351,827 | ) | ||||||
Contingent Liabilities (Note 2) | — | |||||||
Net Assets (deficit) | $ | (2,752,342 | )* |
MERGER_OF_AUDIOEYE_INC_AND_AUD1
MERGER OF AUDIOEYE, INC. AND AUDIOEYE ACQUISITION CORPORATION (Tables) | 12 Months Ended | |||
Dec. 31, 2013 | ||||
MERGER OF AUDIOEYE, INC. AND AUDIOEYE ACQUISITION CORPORATION | ' | |||
Schedule of net assets recorded in business combination | ' | |||
Assets | ||||
Cash | 4,593 | |||
Intangible Assets | 3,551,814 | |||
Goodwill | 700,528 | |||
Total Assets | 4,256,935 | |||
Liabilities | ||||
Accounts payable and accrued expenses | 117,162 | |||
Net Assets | 4,139,773 |
OVERVIEW_Details
OVERVIEW (Details) (USD $) | Dec. 31, 2013 | Dec. 30, 2013 | Mar. 25, 2013 | Mar. 22, 2013 | Aug. 17, 2012 | Jun. 22, 2011 | Dec. 30, 2013 | Aug. 17, 2012 |
iItem | Affiliate of CMG | AudioEye Acquisition Corporation | AudioEye Acquisition Corporation | AudioEye Acquisition Corporation | AudioEye Acquisition Corporation | CMG Holdings Group, Inc. | CMG Holdings Group, Inc. | |
Overview | ' | ' | ' | ' | ' | ' | ' | ' |
Number of patents issued in the United States | 5 | ' | ' | ' | ' | ' | ' | ' |
Number of pending patents in the United States | 3 | ' | ' | ' | ' | ' | ' | ' |
Percentage of outstanding shares acquired | ' | ' | ' | ' | 80.00% | 80.00% | ' | 80.00% |
Remaining interest in the company (as a percent) | ' | ' | ' | ' | ' | ' | ' | 15.00% |
Stockholders dividend to be distributed as the Spin-Off (as a percent) | ' | ' | ' | ' | ' | ' | ' | 5.00% |
Royalty agreement (as a percent) | ' | ' | ' | ' | ' | ' | ' | 10.00% |
Commission agreement (as a percent) | ' | ' | ' | ' | ' | ' | ' | 7.50% |
Commission on net revenues from a specified third party (as a percent) | ' | ' | ' | ' | ' | ' | ' | 10.00% |
Shares of AEAC common stock converted to company stock (in dollars per share) | ' | ' | ' | $0.94 | ' | ' | ' | ' |
Principal amount of debt converted to common shares | ' | ' | $1,400,200 | $1,400,200 | ' | ' | ' | ' |
Accrued interest of debt converted to common shares | ' | ' | 67,732 | 67,732 | ' | ' | ' | ' |
Shares issued to AEAC share holders | ' | ' | 24,004,143 | 24,004,143 | ' | ' | ' | ' |
Shares issued to AEAC debenture holders | ' | ' | 5,871,752 | 5,871,752 | ' | ' | ' | ' |
Number of shares repurchased by the Company | ' | ' | ' | ' | ' | ' | 2,184,583 | ' |
Cash paid by the Company | ' | ' | ' | ' | ' | ' | 573,022 | ' |
Payable forgiven | ' | $50,000 | ' | ' | ' | ' | ' | ' |
SUMMARY_OF_SIGNIFICANT_ACCOUNT3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) (USD $) | 12 Months Ended | 0 Months Ended | 1 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Apr. 30, 2012 | Apr. 30, 2012 | Oct. 31, 2010 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | |
Revenue | Revenue | Lower Range | Upper Range | Empire Technologies, LLC | Empire Technologies, LLC | Empire Technologies, LLC | Empire Technologies, LLC | Empire Technologies, LLC | Couponicate | Couponicate | |||
Customer Concentration Risk | Customer Concentration Risk | iItem | iItem | ||||||||||
iItem | iItem | ||||||||||||
Significant Accounting Policies | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ownership percentage (VIE) | ' | ' | ' | ' | ' | ' | ' | ' | 50.00% | ' | ' | ' | ' |
Membership interest sold (as a percent) | ' | ' | ' | ' | ' | ' | 50.00% | ' | ' | ' | ' | ' | ' |
Consideration paid to LVS for purchase of remaining ownership in Empire | ' | ' | ' | ' | ' | ' | ' | $10 | ' | ' | ' | ' | ' |
Ownership percentage subsidiary | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' |
Ownership percentage (VIE) acquired | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 19.50% |
Assets | 6,276,871 | 4,200,283 | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | 0 | ' |
Liabilities | 947,600 | 2,957,107 | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | 0 | ' |
Net income (loss) | -2,882,626 | -1,166,289 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | ' |
Research and technology expenses | 56,515 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of major customers | ' | ' | 2 | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenue major customers (as a percent) | ' | ' | 81.00% | 81.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of installment payments on certain contracts with multiple payment options | ' | ' | ' | ' | 2 | 3 | ' | ' | ' | ' | ' | ' | ' |
Allowance for doubtful accounts | 0 | 102,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Useful lives of property, plant and equipment | ' | ' | ' | ' | '5 years | '7 years | ' | ' | ' | ' | ' | ' | ' |
Impairment of goodwill | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Period of the average market price of entity's common stock used for determining the market capitalization | '30 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Patent impairment expense | $0 | $0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
SUMMARY_OF_SIGNIFICANT_ACCOUNT4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Fair Value | ' | ' |
Marketable securities | $0 | $30,000 |
Fair Value, Inputs, Level 1 | ' | ' |
Fair Value | ' | ' |
Marketable securities | $0 | $30,000 |
MARKETABLE_SECURITIES_Details
MARKETABLE SECURITIES (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
MARKETABLE SECURITIES | ' | ' |
Shares of Ecologic Transportation held in marketable securities portfolio | 0 | 150,000 |
Marketable securities | $0 | $30,000 |
Realized gain (loss) on marketable securities | ($19,500) | $12,000 |
PROPERTY_PLANT_EQUIPMENT_Detai
PROPERTY, PLANT & EQUIPMENT (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
PROPERTY, PLANT & EQUIPMENT | ' | ' |
Accumulated Depreciation | ($21,631) | ($18,435) |
Property Plant & Equipment, net | 3,847 | 7,043 |
Depreciation expense | 3,196 | 3,883 |
Computer & Peripherals | ' | ' |
PROPERTY, PLANT & EQUIPMENT | ' | ' |
Property Plant & Equipment, gross | $25,478 | $25,478 |
INTANGIBLE_ASSETS_Details
INTANGIBLE ASSETS (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
INTANGIBLE ASSETS | ' | ' |
Estimated useful lives of patents, technology and other intangibles | '10 years | ' |
Intangible Assets | ' | ' |
Accumulated Amortization | ($489,398) | ($135,030) |
Intangible Assets, Net | 3,073,945 | 3,418,621 |
Amortization expense | 354,368 | 135,030 |
Patents | ' | ' |
Intangible Assets | ' | ' |
Intangible Assets, Gross | $3,563,343 | $3,553,651 |
RELATED_PARTY_TRANSACTIONS_Det
RELATED PARTY TRANSACTIONS (Details) (USD $) | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | 0 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 0 Months Ended | |||||||||||||||||||||||||||||||||||||
Dec. 21, 2012 | Apr. 30, 2012 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 24, 2013 | 10-May-13 | Aug. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 05, 2012 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 19, 2013 | Dec. 31, 2012 | Dec. 12, 2012 | Nov. 27, 2012 | Aug. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 19, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 30, 2013 | Aug. 07, 2013 | Feb. 06, 2013 | Aug. 17, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 12, 2012 | Nov. 27, 2012 | Aug. 31, 2012 | Dec. 05, 2012 | Mar. 25, 2013 | Mar. 22, 2013 | Jan. 29, 2013 | Aug. 17, 2012 | Aug. 15, 2012 | Jun. 22, 2011 | Dec. 30, 2013 | Aug. 17, 2012 | Aug. 15, 2012 | Jun. 22, 2011 | Mar. 31, 2010 | |
Minimum | Maximum | CEO Nathaniel Bradley | CEO Nathaniel Bradley | CEO Nathaniel Bradley | CEO Nathaniel Bradley | CEO Nathaniel Bradley | CEO Nathaniel Bradley | CEO Nathaniel Bradley | CEO Nathaniel Bradley | CEO Nathaniel Bradley | CEO Nathaniel Bradley | Sean Bradley | Sean Bradley | Sean Bradley | Sean Bradley | Sean Bradley | Others | Others | Affiliate of CMG | PSU | Secured Promissory Note | Secured Promissory Note | Notes due on demand | Notes due on demand | Notes due on demand | Convertible promissory notes payable to related party | Convertible promissory notes payable to related party | Convertible promissory notes payable to related party | Convertible promissory notes payable to related party | AEAC | AEAC | AEAC | AEAC | AEAC | AEAC | CMG | CMG | CMG | CMG | CMG | ||||||||
CEO Nathaniel Bradley | CEO Nathaniel Bradley | CEO Nathaniel Bradley | CEO Nathaniel Bradley | CEO Nathaniel Bradley | CEO Nathaniel Bradley | CEO Nathaniel Bradley | ||||||||||||||||||||||||||||||||||||||||||
Minimum | Maximum | |||||||||||||||||||||||||||||||||||||||||||||||
Related Party Transaction | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Former stockholders right to receive cash from income earned (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50.00% |
Percentage of outstanding shares acquired | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 80.00% | ' | 80.00% | ' | 80.00% | ' | ' | ' |
Stockholders dividend to be distributed as the Spin-Off (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5.00% | ' |
Aggregate principal amount of senior notes, to be released | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $425,000 | $224,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $1,025,000 | ' |
Cash payment of senior notes, released | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 183,661 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 700,000 | ' | ' | ' | ' | ' | ' |
Issuance of secured promissory note | ' | ' | 50,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 425,000 | ' | ' | ' | ' | ' | ' |
Issuance of shares for debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,500,000 | ' | ' | ' | ' | ' | ' |
Total payments on debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Payment of accrued interest | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 16,339 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Principal amount of debt converted to common shares | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 199,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 241,359 | ' | ' | ' | ' | ' | ' | ' | ' | 1,400,200 | 1,400,200 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of common shares issued for conversion of debt | 5,186,860 | ' | ' | ' | ' | ' | ' | ' | ' | 5,186,860 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,998,402 | ' | ' | ' | ' | ' | ' | ' | ' | 5,871,752 | 5,871,752 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common shares issued for conversion of debt, percentage of total common shares outstanding | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5.68% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Issuance of shares in spin-off | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,500,259 | ' | ' | ' | ' | ' | ' | ' | ' |
Royalty Agreement period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | ' | ' |
Royalty agreement (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10.00% | ' | ' | ' |
Commission agreement (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 7.50% | ' | ' | ' |
Number of shares repurchased by the Company | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,184,583 | ' | ' | ' | ' |
Cash paid by the Company | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 573,022 | ' | ' | ' | ' |
Payable forgiven | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shares of AEAC common stock converted to company stock (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.94 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shares issued to AEAC share holders | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 24,004,143 | 24,004,143 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shares issued to AEAC debenture holders | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,871,752 | 5,871,752 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt instrument term | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '2 years | '2 years | '2 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of debt converted to common stock | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Related party loans | ' | ' | 10,000 | 35,000 | ' | ' | ' | ' | ' | ' | 35,000 | ' | ' | ' | 10,000 | 10,000 | 2,500 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Strike price (in dollars per share) | ' | ' | ' | ' | ' | $1.22 | ' | $0.25 | $0.60 | ' | $0.40 | $0.39 | $0.50 | $0.25 | ' | ' | ' | ' | ' | ' | $0.39 | $0.50 | $0.25 | ' | ' | ' | ' | ' | ' | ' | $0.40 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Discount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6,901 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Closing stock price (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.45 | ' | ' | ' | $0.35 | $0.43 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Term | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Volatility (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Dividends (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Discount rate (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.37% | 1.43% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accrued salary converted amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Principal and accrued salary converted to common stock shares | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 746,677 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Principal and accrued salary converted to warrants | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 746,677 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Additional accrued salary converted amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 461,539 | ' | ' | ' | ' | ' | ' | ' | ' | 399,648 | ' | ' | ' | ' | 161,564 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Additional accrued salary converted to warrants | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,831,783 | ' | ' | ' | ' | ' | ' | ' | ' | 1,587,290 | ' | ' | ' | ' | 626,680 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accrued salary exchanged for marketable securities | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,500 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Realized loss on accrued salary exchanged for marketable securities | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 19,500 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accounts payable due to related party | ' | ' | ' | 150,174 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Related party payable | ' | ' | 829,418 | 243,424 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8.00% | ' | ' | ' | 8.00% | 8.00% | 8.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Related party loans | ' | ' | 10,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount due to related party | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 39,500 | ' | ' | ' | 386,539 | ' | ' | 50,000 | 1,245,840 | 24,375 | ' | ' | ' | 341,731 | 29,375 | 101,148 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Warrants to purchase shares | ' | ' | ' | 1,142,000 | 10,888,336 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,587,290 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 28,400 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Conversion price to common stock (in dollars per share) | ' | ' | ' | ' | ' | ' | $0.25 | ' | ' | $0.25 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.25 | $0.25 | $0.25 | $0.25 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock Issued During Period, Value, Conversion of Convertible Securities | ' | ' | 1,296,715 | ' | ' | ' | ' | ' | ' | 1,296,715 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accrued Interest converted to shares | ' | ' | ' | ' | ' | ' | ' | ' | ' | 875 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accrued Interest forgiven in share conversion | ' | ' | ' | ' | ' | ' | ' | ' | ' | $84,581 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ownership interest (as a percent) | ' | 100.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
RELATED_PARTY_TRANSACTIONS_Det1
RELATED PARTY TRANSACTIONS (Details 2) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
RELATED PARTY TRANSACTIONS | ' | ' |
Related party receivables | $82,250 | $16,125 |
Revenue from related party | $108,500 | $3,000 |
NOTES_PAYABLE_Details
NOTES PAYABLE (Details) (USD $) | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 0 Months Ended | 12 Months Ended | ||||||||||||
Dec. 21, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 24, 2013 | 10-May-13 | Aug. 31, 2012 | Mar. 25, 2013 | Mar. 22, 2013 | Aug. 15, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | Mar. 31, 2013 | Oct. 24, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Aug. 03, 2013 | Dec. 31, 2013 | Feb. 06, 2013 | Dec. 31, 2012 | Aug. 17, 2012 | Aug. 17, 2012 | Dec. 31, 2012 | |
AudioEye Acquisition Corporation | AudioEye Acquisition Corporation | AudioEye Acquisition Corporation | Maximum | AudioEye Acquisition Corp Notes | AEAC Debentures | AEAC Debentures | Maryland TEDCO | Maryland TEDCO | Maryland TEDCO | Notes Payable | Notes Payable | CMGO Investors, LLC | CMGO Investors, LLC | CMGO Investors, LLC | CMGO Investors, LLC | Loans Payable | |||||||
Maximum | |||||||||||||||||||||||
Notes Payable | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Short Term | ' | $172,845 | $1,466,700 | ' | ' | ' | ' | ' | ' | ' | $1,017,700 | ' | ' | ' | $24,000 | $24,000 | ' | $148,845 | ' | $425,000 | ' | ' | ' |
Long Term | ' | 79,800 | 97,800 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 79,800 | 97,800 | ' | ' | ' | ' | ' | ' | ' |
Discount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6,930 | 1,155 | ' | ' | ' | ' | ' |
Carrying amount of debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 103,800 | 121,800 | 143,070 | ' | ' | ' | ' | ' | 74,900 |
Interest rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8.00% | ' | ' | ' | ' | 10.00% | ' | ' | ' | 8.00% | ' | 25.00% |
Due date from the date of issuance | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '1 year | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '4 years |
Accrued interest | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,384 | ' | ' | ' | ' | 74,900 |
Face amount of debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,017,700 | 382,500 | 149,800 | ' | ' | 150,000 | 224,000 | ' | ' | 425,000 | ' | ' |
Monthly payments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total payments | ' | 218,000 | 742,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 18,000 | 24,000 | ' | ' | ' | ' | ' | ' | ' |
Debt conversion - percent of total issued and outstanding common shares as of conversion date | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10.00% | ' | ' |
Debt conversion - number of shares | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6,000,000 | ' |
Total payments on debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 200,000 | ' | ' | ' | ' |
Payment of accrued interest | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 16,339 | ' | ' | ' | ' |
Repayment of debt | ' | ' | ' | ' | ' | ' | ' | ' | 700,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 183,661 | ' | ' | ' | ' |
Principal amount of debt converted to common shares | ' | ' | ' | ' | ' | ' | 1,400,200 | 1,400,200 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 241,359 | ' | ' | ' | ' |
Number of common shares issued for conversion of debt | 5,186,860 | ' | ' | ' | ' | ' | 5,871,752 | 5,871,752 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,998,402 | ' | ' | ' | ' |
Common shares issued for conversion of debt, percentage of total common shares outstanding | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5.68% | ' | ' | ' | ' |
Conversion option of principal and interest (in dollars per share) | ' | ' | ' | ' | ' | $0.25 | ' | ' | ' | ' | ' | $0.25 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accrued interest of debt converted to common shares | ' | ' | ' | ' | ' | ' | 67,732 | 67,732 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Warrants to purchase shares | ' | 1,142,000 | ' | 10,888,336 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 20,000 | ' | ' | ' | ' | ' | ' |
Strike price (in dollars per share) | ' | ' | ' | ' | $1.22 | ' | ' | ' | ' | $0.60 | ' | ' | ' | ' | ' | ' | $0.50 | $0.40 | ' | ' | ' | ' | ' |
Share price (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.47 | ' | ' | ' | ' | ' | ' |
Term | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | ' | ' |
Volatility (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' | ' |
Dividends (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.00% | ' | ' | ' | ' | ' | ' |
Discount rate (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.36% | ' | ' | ' | ' | ' | ' |
Amortization expense | ' | $354,368 | $135,030 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $5,755 | ' | ' | ' | ' | ' |
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Details) (USD $) | 12 Months Ended | 0 Months Ended | ||||||
Dec. 31, 2013 | Dec. 31, 2012 | Jan. 24, 2014 | Aug. 07, 2013 | Aug. 07, 2013 | Aug. 07, 2013 | Aug. 07, 2013 | Aug. 07, 2013 | |
sqft | Nathaniel Bradley | Sean Bradley | James Crawford | Edward O'Donnell | Constantine Potamianos | |||
Commitments and Contingencies | ' | ' | ' | ' | ' | ' | ' | ' |
Area of principal executive offices | ' | ' | 6,003 | ' | ' | ' | ' | ' |
Rent expense per month | $12,927 | ' | ' | ' | ' | ' | ' | ' |
Rent expense | 38,388 | 30,165 | ' | ' | ' | ' | ' | ' |
Executive Employment Agreement period | ' | ' | ' | '3 years | '3 years | '3 years | '2 years | '2 years |
Base salary | ' | ' | ' | $200,000 | $195,000 | $185,000 | $165,000 | $150,000 |
STOCKHOLDERS_EQUITY_Details
STOCKHOLDERS' EQUITY (Details) (USD $) | 0 Months Ended | 3 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 6 Months Ended | 12 Months Ended | 0 Months Ended | 1 Months Ended | 0 Months Ended | |||||||||||||||||||
Dec. 23, 2013 | Dec. 24, 2013 | Oct. 10, 2013 | Sep. 10, 2013 | Apr. 05, 2013 | Dec. 21, 2012 | Aug. 17, 2012 | Apr. 30, 2012 | Jun. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Aug. 31, 2012 | Dec. 31, 2011 | Dec. 30, 2013 | Dec. 05, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Nov. 25, 2013 | Nov. 16, 2013 | Dec. 31, 2013 | Sep. 30, 2013 | 10-May-13 | Mar. 19, 2013 | Jun. 30, 2013 | Dec. 31, 2013 | Apr. 30, 2012 | Apr. 30, 2012 | Mar. 25, 2013 | Mar. 22, 2013 | Aug. 15, 2012 | Feb. 06, 2013 | |
iItem | Affiliate of CMG | Nathaniel Bradley | Common Stock | Common Stock | Common Stock | Common Stock | Warrants | Warrants | Maximum | Maximum | Maximum | Maximum | Maximum | Empire Technologies, LLC | Empire Technologies, LLC | AudioEye Acquisition Corporation | AudioEye Acquisition Corporation | AudioEye Acquisition Corporation | Secured Promissory Note to CMGO Investors | |||||||||||||
Affiliate of a director | Warrants | Warrants | Warrants | Warrants | ||||||||||||||||||||||||||||
STOCKHOLDERS' EQUITY | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common Stock, shares authorized | ' | ' | ' | ' | ' | ' | 100,000,000 | ' | ' | 100,000,000 | 100,000,000 | ' | 4,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common Stock, par value (in dollars per share) | ' | ' | ' | ' | ' | ' | $0.00 | ' | ' | $0.00 | $0.00 | ' | $0.00 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Forward split conversion ratio | ' | ' | ' | ' | ' | ' | 11.78299032 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common Stock, shares issued | ' | ' | ' | ' | ' | ' | 30,005,185 | ' | ' | 53,239,369 | 35,192,045 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Acquisition of AEAC - merger of entities under common control | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $3,123,136 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accounts paid by AEAC | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 20,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock option expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 11,309 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common Stock, shares outstanding | ' | ' | ' | ' | ' | ' | ' | ' | ' | 53,239,369 | 35,192,045 | ' | ' | ' | ' | 53,239,369 | 35,192,045 | 30,005,185 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stockholders' Equity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt converted into common stock (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Conversion price (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.25 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount of debt converted into common stock | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,296,715 | ' | ' | ' | ' | ' | 52 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Membership interest sold (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50.00% | ' | ' | ' | ' | ' |
Consideration paid to LVS for purchase of remaining ownership in Empire | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10 | ' | ' | ' | ' |
Non-controlling interest | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 14,701 | 14,701 | ' | ' | ' | ' |
Ownership interest (as a percent) | ' | ' | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' |
Total payments on debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 200,000 |
Payment of accrued interest | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 16,339 |
Repayment of debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 700,000 | 183,661 |
Principal amount of debt converted to common shares | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 199,000 | ' | ' | ' | ' | ' | ' | ' | 1,400,200 | 1,400,200 | ' | 241,359 |
Number of common shares issued for conversion of debt | ' | ' | ' | ' | ' | 5,186,860 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,871,752 | 5,871,752 | ' | 1,998,402 |
Common shares issued for conversion of debt, percentage of total common shares outstanding | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5.68% |
Accrued interest of debt converted to common shares | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 67,732 | 67,732 | ' | ' |
Shares issued for services | ' | ' | ' | ' | 200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Value of shares issued for services | ' | ' | ' | ' | 50,000 | ' | ' | ' | ' | 50,000 | 20,000 | ' | ' | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Units sold to accredited investors (in shares) | 10,088,336 | 10,088,336 | ' | ' | ' | ' | ' | ' | 1,092,000 | 1,142,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Units sold to accredited investors, number of common shares | 10,088,336 | ' | ' | ' | ' | ' | ' | ' | 1,092,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount of the Private Placement | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Proceeds from sale of units to accredited investors | 3,026,500 | 2,750,092 | ' | ' | ' | ' | ' | ' | 496,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Private placement cost | 276,408 | ' | ' | ' | ' | ' | ' | ' | 39,100 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of units sold to accredited investors of accounts payable forgiven | ' | ' | ' | ' | ' | ' | ' | ' | 100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accounts payable forgiven from the sale of units to accredited investors | ' | ' | ' | ' | ' | ' | ' | ' | 50,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of common shares consisted in each unit sold to accredited investor | ' | 1 | ' | ' | ' | ' | ' | ' | 1 | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Term of warrants issued to accredited investor | '5 years | '3 years | ' | ' | ' | ' | ' | ' | '3 years | '3 years | ' | ' | ' | ' | ' | ' | ' | ' | '3 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of common shares that can be purchased against each warrant issued to accredited investor | ' | 1 | ' | ' | ' | ' | ' | ' | 1 | 1 | ' | ' | ' | ' | ' | ' | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Exercise price of units (in dollars per share) | $0.40 | $0.40 | ' | ' | ' | ' | ' | ' | $0.50 | $0.50 | ' | ' | ' | ' | ' | ' | ' | ' | $0.50 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Purchase price of units (in dollars per share) | ' | $0.30 | ' | ' | ' | ' | ' | ' | $0.50 | $0.50 | ' | ' | ' | ' | ' | ' | ' | ' | $0.50 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Warrants to purchase shares | ' | 10,888,336 | ' | ' | ' | ' | ' | ' | ' | 1,142,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Private Placement shares sold | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of common stock shares included in each unit sold | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of accredited investors | 15 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Units sold to accredited investors, number of warrants | 10,088,336 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Units sold to accredited investors, number of warrants for common stock issued to the placement agent in connection with their services | 952,564 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accrued salary converted amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Principal and accrued salary converted to common stock shares | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 746,677 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Principal and accrued salary converted to warrants | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 746,677 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Payable forgiven | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common shares for the exercise of options | ' | ' | 42,250 | 142,500 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 184,750 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Proceeds from exercise of options | ' | ' | 10,562 | 37,188 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Issuance of warrants (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | 405,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,300,000 | ' | 293,915 | 41,872 | 3,652,672 | 99,166 | 405,000 | ' | ' | ' | ' | ' | ' |
Issuance of warrants (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4,054,753 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accrued salary converted to warrants | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,022,751 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Issuance of warrants (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | 41,872 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accounts payable converted to warrants | ' | ' | ' | ' | ' | ' | ' | ' | ' | 51,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Warrants. Options and PSU issued for services | ' | ' | ' | ' | ' | ' | ' | ' | ' | $1,191,128 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
INCOME_TAXES_Details
INCOME TAXES (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Deferred tax assets: | ' | ' |
Net operating loss carryforwards | $1,720,000 | $1,170,000 |
Less valuation allowance | -1,720,000 | -1,170,000 |
Net operating loss carry forward | $5,071,000 | $3,440,000 |
OPTIONS_Details
OPTIONS (Details) (USD $) | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | |||||||||||||||||||||||
Oct. 10, 2013 | Sep. 10, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 19, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 19, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | 10-May-13 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Jul. 29, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Aug. 20, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Aug. 20, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 13, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | |
Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | Options | |||||
Minimum | Maximum | Options granted on December 19, 2012 | Options granted on December 19, 2012 | Options granted on December 19, 2012 | Options granted on May 10, 2013 | Options granted on May 10, 2013 | Options granted on May 10, 2013 | Options granted on May 10, 2013 | Options granted on May 10, 2013 | Options granted on July 29, 2013 | Options granted on July 29, 2013 | Options granted on July 29, 2013 | Options granted on July 29, 2013 | Options granted on July 29, 2013 | Options granted one, on August 20, 2013 | Options granted one, on August 20, 2013 | Options granted one, on August 20, 2013 | Options granted one, on August 20, 2013 | Options granted one, on August 20, 2013 | Options granted two, on August 20, 2013 | Options granted two, on August 20, 2013 | Options granted two, on August 20, 2013 | Options granted two, on August 20, 2013 | Options granted two, on August 20, 2013 | Options granted two, on August 20, 2013 | Options granted two, on August 20, 2013 | Options granted on December 13, 2013 | Options granted on December 13, 2013 | Options granted on December 13, 2013 | Options granted on December 13, 2013 | Options granted on December 13, 2013 | ||||||||
Options Vested on Grant Date | Vesting every 90 days | Options vested on July 29, 2014 | Options vested on July 29, 2015 | Options vested in February 2014 | Options vested in August 2014 | 20-Aug-16 | 20-Aug-18 | Vesting every 90 days | Immediate vesting | Vesting every 90 days | Immediate vesting | ||||||||||||||||||||||||||||
Options | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options issued and outstanding | ' | ' | ' | ' | ' | 4,485,250 | 2,820,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of options issued | ' | ' | ' | ' | ' | 1,850,000 | 2,820,000 | ' | ' | 2,820,000 | ' | ' | 400,000 | ' | ' | ' | ' | 350,000 | ' | ' | ' | ' | 300,000 | ' | ' | ' | ' | 700,000 | ' | ' | ' | ' | ' | ' | 100,000 | ' | ' | ' | ' |
Vesting percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50.00% | 12.50% | ' | ' | ' | 50.00% | 50.00% | ' | ' | ' | 50.00% | 50.00% | ' | ' | ' | ' | ' | 12.50% | 50.00% | ' | ' | ' | 12.50% | 50.00% |
Number of options granted prior to initial option grant | ' | ' | ' | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Vesting period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '2 years | ' | ' | ' | ' | ' | '90 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '90 days | ' | ' | ' | ' | '90 days | ' |
Exercise Price (in dollars per share) | ' | ' | ' | ' | ' | $0.57 | $0.25 | ' | ' | ' | $0.25 | ' | ' | $1 | ' | ' | ' | ' | $0.35 | ' | ' | ' | ' | ' | ' | $0.40 | $0.50 | ' | $0.50 | ' | ' | ' | ' | ' | ' | $0.50 | ' | ' | ' |
Number of options expired | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100,000 | 600,000 | ' | ' | ' | ' | ' | ' | ' |
Significant assumptions used in the valuation | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Expected term | ' | ' | ' | ' | ' | '3 years 3 months | ' | '1 year 5 months 1 day | '3 years 3 months | ' | '3 years 3 months | ' | ' | '1 year 5 months 1 day | ' | ' | ' | ' | '2 years 8 months 1 day | ' | ' | ' | ' | '2 years 10 months 17 days | ' | ' | ' | ' | ' | ' | '1 year 9 months | '2 years 10 months 17 days | ' | ' | ' | '1 year 5 months 1 day | ' | ' | ' |
Expected volatility (as a percent) | ' | ' | ' | ' | ' | 100.00% | ' | 100.00% | 250.00% | ' | 250.00% | ' | ' | 100.00% | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' |
Risk-free interest rate (as a percent) | ' | ' | ' | ' | ' | 0.00% | ' | ' | ' | ' | 0.39% | ' | ' | 0.82% | ' | ' | ' | ' | 0.82% | ' | ' | ' | ' | 0.82% | ' | ' | ' | ' | 0.82% | ' | ' | ' | ' | ' | ' | 0.82% | ' | ' | ' |
Expected dividend yield (as a percent) | ' | ' | ' | ' | ' | 0.00% | ' | ' | ' | ' | 0.00% | ' | ' | 0.00% | ' | ' | ' | ' | 0.00% | ' | ' | ' | ' | 0.00% | ' | ' | ' | ' | 0.00% | ' | ' | ' | ' | ' | ' | 0.00% | ' | ' | ' |
Grant date fair value of options | ' | ' | ' | ' | ' | ' | ' | ' | ' | $687,953 | ' | ' | $152,067 | ' | ' | ' | ' | $72,311 | ' | ' | ' | ' | $67,928 | ' | ' | ' | ' | $147,441 | ' | ' | ' | ' | ' | ' | $11,180 | ' | ' | ' | ' |
Options based expense | ' | ' | 430,138 | 0 | ' | 648,387 | 11,309 | ' | ' | ' | 377,121 | 11,309 | ' | 124,987 | 0 | ' | ' | ' | 15,354 | 0 | ' | ' | ' | 24,752 | 0 | ' | ' | ' | 100,583 | 0 | ' | ' | ' | ' | ' | 5,590 | 0 | ' | ' |
Number of options exercised | 42,250 | 142,500 | ' | ' | ' | 184,750 | ' | ' | ' | ' | 184,750 | ' | ' | 0 | ' | ' | ' | ' | 0 | ' | ' | ' | ' | 0 | ' | ' | ' | ' | 0 | ' | ' | ' | ' | ' | ' | 0 | ' | ' | ' |
Number of options: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Outstanding at the beginning of the period (in shares) | ' | ' | ' | ' | ' | 2,820,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Granted (in shares) | ' | ' | ' | ' | ' | 1,850,000 | 2,820,000 | ' | ' | 2,820,000 | ' | ' | 400,000 | ' | ' | ' | ' | 350,000 | ' | ' | ' | ' | 300,000 | ' | ' | ' | ' | 700,000 | ' | ' | ' | ' | ' | ' | 100,000 | ' | ' | ' | ' |
Exercised (in shares) | 42,250 | 142,500 | ' | ' | ' | 184,750 | ' | ' | ' | ' | 184,750 | ' | ' | 0 | ' | ' | ' | ' | 0 | ' | ' | ' | ' | 0 | ' | ' | ' | ' | 0 | ' | ' | ' | ' | ' | ' | 0 | ' | ' | ' |
Outstanding at the end of the period (in shares) | ' | ' | ' | ' | ' | 4,485,250 | 2,820,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Wtd Avg. Exercise Price | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Outstanding at the beginning of the period (in dollars per share) | ' | ' | ' | ' | ' | $0.25 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Granted (in dollars per share) | ' | ' | ' | ' | ' | $0.57 | $0.25 | ' | ' | ' | $0.25 | ' | ' | $1 | ' | ' | ' | ' | $0.35 | ' | ' | ' | ' | ' | ' | $0.40 | $0.50 | ' | $0.50 | ' | ' | ' | ' | ' | ' | $0.50 | ' | ' | ' |
Exercised (in dollars per share) | ' | ' | ' | ' | ' | $0.25 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Outstanding at the end of the period (in dollars per share) | ' | ' | ' | ' | ' | $0.38 | $0.25 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Remaining Average Contractual Life (in years) | ' | ' | ' | ' | ' | '3 years 11 months 16 days | '4 years 11 months 19 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Intrinsic value of outstanding options | ' | ' | ' | ' | ' | 99,070 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Outstanding and Exercisable Options | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Average Exercise Price (in dollars per share) | ' | ' | ' | ' | ' | $0.57 | $0.25 | ' | ' | ' | $0.25 | ' | ' | $1 | ' | ' | ' | ' | $0.35 | ' | ' | ' | ' | ' | ' | $0.40 | $0.50 | ' | $0.50 | ' | ' | ' | ' | ' | ' | $0.50 | ' | ' | ' |
Number of Shares | ' | ' | ' | ' | ' | 4,485,250 | 2,820,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Remaining Average Contractual Life | ' | ' | ' | ' | ' | '3 years 11 months 16 days | '4 years 11 months 19 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Exercise price times number of share | ' | ' | ' | ' | ' | 1,716,313 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted Average Exercise Price (in dollars per share) | ' | ' | ' | ' | ' | $0.38 | $0.25 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Intrinsic Value | ' | ' | ' | ' | ' | $99,070 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
WARRANTS_Details
WARRANTS (Details) (USD $) | 0 Months Ended | 3 Months Ended | 12 Months Ended | 0 Months Ended | 2 Months Ended | 12 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 6 Months Ended | 0 Months Ended | 6 Months Ended | 12 Months Ended | 0 Months Ended | 6 Months Ended | 0 Months Ended | 12 Months Ended | 12 Months Ended | 0 Months Ended | 6 Months Ended | 12 Months Ended | |||||||||||||||||||
Dec. 23, 2013 | Dec. 24, 2013 | Oct. 10, 2013 | Sep. 10, 2013 | Jun. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | 10-May-13 | Mar. 19, 2013 | Aug. 03, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Sep. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Sep. 30, 2013 | Mar. 19, 2013 | Jun. 30, 2013 | Dec. 31, 2013 | Sep. 30, 2013 | Mar. 19, 2013 | Jun. 30, 2013 | Dec. 31, 2013 | Sep. 30, 2013 | Mar. 19, 2013 | Jun. 30, 2013 | Sep. 30, 2013 | Nov. 16, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Nov. 16, 2013 | Dec. 31, 2013 | 10-May-13 | Mar. 19, 2013 | Jun. 30, 2013 | Dec. 31, 2013 | |
Note | Note | Options | Options | Minimum | Minimum | Maximum | Maximum | Maximum | James Crawford | James Crawford | James Crawford | James Crawford | Nathaniel Bradley | Nathaniel Bradley | Nathaniel Bradley | Nathaniel Bradley | Sean Bradley | Sean Bradley | Sean Bradley | Ted O'Donnell | Warrants | Warrants | Warrants | Warrants | Warrants | Warrants | Warrants | Warrants | Warrants | Warrants | |||||||||||
Options | Options | Options | Options | Options | Minimum | Maximum | Maximum | Maximum | Maximum | ||||||||||||||||||||||||||||||||
Warrants | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Issuance of warrants (in shares) | ' | ' | ' | ' | ' | 405,000 | ' | ' | ' | ' | 20,000 | 28,400 | ' | ' | ' | ' | 293,915 | ' | ' | 95,394 | 464,593 | 38,333 | ' | 103,128 | 1,696,155 | 32,500 | ' | 67,033 | 1,491,924 | 28,333 | 28,360 | 1,300,000 | ' | ' | ' | ' | ' | 41,872 | 3,652,672 | 99,166 | 405,000 |
Release of aggregate due to related party | ' | ' | ' | ' | $38,333 | ' | ' | ' | ' | $913,168 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Strike price (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | $1.22 | ' | $0.50 | $0.40 | ' | ' | $0.25 | ' | ' | $0.60 | ' | $0.39 | $0.25 | $0.50 | ' | $0.39 | $0.25 | $0.50 | $0.40 | $0.39 | $0.25 | $0.50 | $0.39 | $0.01 | $0.40 | ' | ' | ' | ' | ' | ' | ' | ' |
Annual vesting percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 33.00% | ' | ' | ' | 33.00% | ' | ' | ' | 33.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Value of warrants | ' | ' | ' | ' | 38,333 | 98,851 | ' | 71,250 | 51,000 | 913,168 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Significant assumptions used in the valuation | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Expected term | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '3 years 3 months | ' | ' | '1 year 5 months 1 day | ' | ' | '3 years 3 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | '1 year 6 months | ' | ' | ' | '5 years |
Expected volatility (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% | ' | ' | 100.00% | ' | ' | 250.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' | 100.00% | ' | ' | ' | 250.00% |
Risk-free interest rate (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.68% | ' | ' | ' | ' | 0.82% | ' | ' | ' | 1.68% |
Expected dividend yield (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.00% | 0.00% | ' | ' | ' | ' | ' | ' | ' | ' |
Grant date fair value of options | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 331,287 | ' | ' | ' | ' | ' |
Stock compensation expense related to the options and warrants | ' | ' | ' | ' | ' | 430,138 | 0 | ' | ' | ' | ' | ' | 648,387 | 11,309 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 331,286 | 0 | ' | ' | ' | ' | ' | ' |
Number of options exercised | ' | ' | 42,250 | 142,500 | ' | ' | ' | ' | ' | ' | ' | ' | 184,750 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | ' | ' | ' | ' | ' | ' | ' |
Units sold to accredited investors (in shares) | 10,088,336 | 10,088,336 | ' | ' | 1,092,000 | 1,142,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of common shares consisted in each unit sold to accredited investor | ' | 1 | ' | ' | 1 | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Term of warrants issued to accredited investor | '5 years | '3 years | ' | ' | '3 years | '3 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of common shares that can be purchased against each warrant issued to accredited investor | ' | 1 | ' | ' | 1 | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Exercise price of units (in dollars per share) | $0.40 | $0.40 | ' | ' | $0.50 | $0.50 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Purchase price of units (in dollars per share) | ' | $0.30 | ' | ' | $0.50 | $0.50 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Warrants to purchase shares | ' | 10,888,336 | ' | ' | ' | 1,142,000 | ' | ' | ' | ' | 20,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,587,290 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Face amount of debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 150,000 | 224,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt discount for warrants issued with debt | ' | ' | ' | ' | ' | 13,831 | ' | ' | ' | ' | 6,930 | 6,901 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Proceeds from sale of units to accredited investors | 3,026,500 | 2,750,092 | ' | ' | 496,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Principal amount of debt converted to common shares | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 199,000 | ' | ' | ' | ' | ' | 199,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Accrued salary converted amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $25,000 | ' | ' | ' | ' | ' | $25,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Principal and accrued salary converted to common stock shares | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 746,677 | ' | ' | ' | ' | ' | 746,677 | ' | ' | ' | ' | ' | ' | ' | ' |
Principal and accrued salary converted to warrants | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 746,677 | ' | ' | ' | ' | ' | 746,677 | ' | ' | ' | ' | ' | ' | ' | ' |
WARRANTS_Details_2
WARRANTS (Details 2) (USD $) | 12 Months Ended |
Dec. 31, 2013 | |
Number of shares | ' |
Number of shares, beginning | 0 |
Number of shares, granted | 18,770,591 |
Number of shares, ending | 18,770,591 |
Weighted average exercise price | ' |
Weighted average exercise price, granted (in dollars per share) | $0.35 |
Weighted average exercise price, ending (in dollars per share) | $0.35 |
Weighted average remaining term | '4 years 7 months 13 days |
Intrinsic value | $416,000 |
PERFORMANCE_SHARE_UNITS_Detail
PERFORMANCE SHARE UNITS (Details) (USD $) | 12 Months Ended | 12 Months Ended | |||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Aug. 07, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | |
PSUs | PSUs | Nathaniel Bradley | Sean Bradley | James Crawford | |||
PSUs | PSUs | PSUs | |||||
PERFORMANCE SHARE UNITS | ' | ' | ' | ' | ' | ' | ' |
Performance share unit agreement granted (in shares) | 405,000 | ' | ' | ' | 200,000 | 200,000 | 200,000 |
Performance share unit subject to increase of total units (in shares) | ' | ' | ' | ' | 400,000 | 300,000 | 300,000 |
Performance share unit agreement period | ' | ' | ' | ' | '3 years | '3 years | '3 years |
Number of shares issued for each performance share unit | ' | ' | ' | ' | 1 | 1 | 1 |
Percentage of units estimated to be issued | ' | ' | 100.00% | ' | ' | ' | ' |
Number of incentive shares estimated to be issued | 1,000,000 | ' | ' | ' | ' | ' | ' |
Closing stock price (in dollars per share) | ' | ' | ' | $0.45 | ' | ' | ' |
Expenses to be amortized over performance period | ' | ' | $450,000 | ' | ' | ' | ' |
Expenses incurred | 430,138 | 0 | 112,603 | ' | ' | ' | ' |
Additional expenses to be amortized through the first quarter of 2016 | ' | ' | $337,397 | ' | ' | ' | ' |
ACQUISITION_OF_AUDIOEYE_INC_BY2
ACQUISITION OF AUDIOEYE, INC. BY AUDIOEYE ACQUISITION CORPORATION (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Aug. 17, 2012 |
AudioEye Inc. | |||
Acquisition | ' | ' | ' |
Percentage of outstanding shares acquired | ' | ' | 80.00% |
Purchase Price Allocation | ' | ' | ' |
Cash paid for entity | ' | ' | $1,125,000 |
Stock issued for acquisition | ' | ' | 375,000 |
Stock issued for acquisition (in shares) | ' | ' | 1,500,000 |
Purchase price | ' | ' | 1,500,000 |
Less: Net Assets (deficit) | ' | ' | 2,752,342 |
Less: Identifiable Intangibles - Patents | ' | ' | -3,551,814 |
Goodwill | 700,528 | 700,528 | 700,528 |
Net Assets (deficit) | ' | ' | ' |
Current Assets | ' | ' | 109,521 |
Property, Plant & Equipment, net | ' | ' | 7,688 |
Current Liabilities | ' | ' | -1,517,724 |
L/T Liabilities | ' | ' | -1,351,827 |
Net assets | ' | ' | ($2,752,342) |
MERGER_OF_AUDIOEYE_INC_AND_AUD2
MERGER OF AUDIOEYE, INC. AND AUDIOEYE ACQUISITION CORPORATION (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Mar. 25, 2013 | Mar. 22, 2013 | Dec. 31, 2012 |
AudioEye Acquisition Corporation | AudioEye Acquisition Corporation | AudioEye Acquisition Corporation | |||
Merger | ' | ' | ' | ' | ' |
Shares of AEAC common stock converted to company stock (in dollars per share) | ' | ' | ' | $0.94 | ' |
Aggregate principal amount of debentures assumed | ' | ' | $1,400,200 | $1,400,200 | ' |
Accrued interest on debentures assumed | ' | ' | 67,732 | 67,732 | ' |
Shares issued to AEAC share holders | ' | ' | 24,004,143 | 24,004,143 | ' |
Shares issued to AEAC debenture holders | ' | ' | 5,871,752 | 5,871,752 | ' |
Assets | ' | ' | ' | ' | ' |
Cash | ' | ' | ' | ' | 4,593 |
Intangible Assets | ' | ' | ' | ' | 3,551,814 |
Goodwill | 700,528 | 700,528 | ' | ' | 700,528 |
Total Assets | ' | ' | ' | ' | 4,256,935 |
Liabilities | ' | ' | ' | ' | ' |
Accounts payable and accrued expenses | ' | ' | ' | ' | 117,162 |
Net Assets | ' | ' | ' | ' | $4,139,773 |
CONCENTRATIONS_Details
CONCENTRATIONS (Details) (Revenues, Major Customer) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
iItem | iItem | |
Concentrations | ' | ' |
Number of major customers | 2 | 1 |
Concentration percent | 81.00% | 81.00% |
Customer 1 | ' | ' |
Concentrations | ' | ' |
Concentration percent | 70.00% | 58.00% |
Customer 2 | ' | ' |
Concentrations | ' | ' |
Concentration percent | 10.00% | ' |
SUBSEQUENT_EVENTS_Details
SUBSEQUENT EVENTS (Details) (USD $) | 0 Months Ended | 3 Months Ended | 12 Months Ended | 12 Months Ended | 0 Months Ended | 0 Months Ended | 0 Months Ended | 0 Months Ended | 0 Months Ended | |||||||||||||||||||
Dec. 23, 2013 | Dec. 24, 2013 | Apr. 05, 2013 | Jun. 30, 2013 | Dec. 31, 2013 | 10-May-13 | Dec. 31, 2012 | Aug. 17, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2013 | Mar. 31, 2014 | Mar. 24, 2014 | Mar. 05, 2014 | Jan. 27, 2014 | Mar. 27, 2014 | Mar. 24, 2014 | Mar. 24, 2014 | Feb. 11, 2014 | Jan. 27, 2014 | Jan. 27, 2014 | Jan. 27, 2014 | Jan. 27, 2014 | Jan. 27, 2014 | Jan. 30, 2014 | Mar. 03, 2014 | |
iItem | Stock options | Stock options | Maximum | Maximum | Subsequent events | Subsequent events | Subsequent events | Subsequent events | Subsequent events | Subsequent events | Subsequent events | Subsequent events | Subsequent events | Subsequent events | Subsequent events | Subsequent events | Subsequent events | Subsequent events | Subsequent events | |||||||||
Stock options | Maximum | Maximum | Mr. Arena | Mr. Arena | Mr. Arena | Mr. Arena | Mr. Arena | Accredited investors | Mr. Purcell | |||||||||||||||||||
Stock options | PSUs | Maximum | Maximum | iItem | Stock options | |||||||||||||||||||||||
PSUs | ||||||||||||||||||||||||||||
Subsequent event | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Executive Employment Agreement period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '2 years | ' | ' | ' | ' | ' | ' |
Base salary | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $275,000 | ' | ' | ' | ' | ' | ' |
Signing bonus | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 35,000 | ' | ' | ' | ' | ' | ' |
Quarterly bonus | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50,000 | ' | ' | ' |
Term of warrant | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | ' | ' |
Warrants to purchase shares | ' | 10,888,336 | ' | ' | 1,142,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 44,307 | ' | ' | 1,000,000 | ' | 250,000 | ' | ' | ' | ' | ' | ' |
Exercise price of warrants (in dollars per share) | ' | ' | ' | ' | ' | $1.22 | ' | ' | ' | ' | ' | ' | $0.60 | ' | $0.40 | ' | $0.40 | ' | ' | ' | ' | $0.40 | ' | ' | ' | ' | ' | ' |
Number of options issued | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,850,000 | 2,820,000 | ' | ' | ' | ' | ' | ' | ' | 2,577,100 | ' | ' | ' | 1,500,000 | ' | ' | ' | ' | 250,000 |
Exercise price of options (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.38 | $0.25 | ' | ' | ' | ' | ' | ' | ' | $0.45 | ' | ' | ' | $0.40 | ' | ' | ' | ' | $0.40 |
Number of units granted (in shares) | ' | ' | ' | ' | 405,000 | ' | ' | ' | ' | ' | ' | 293,915 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,000,000 | ' | ' |
Common stock issued for services (in shares) | ' | ' | 200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100,000 | ' | ' | 44,307 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of shares issued for each unit | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | ' | ' | ' | ' |
Units sold to accredited investors (in shares) | 10,088,336 | 10,088,336 | ' | 1,092,000 | 1,142,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 666,667 | ' |
Number of accredited investors to whom the entity sold units | 15 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' |
Proceeds from sale of units to accredited investors | 3,026,500 | 2,750,092 | ' | 496,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 200,000 | ' |
Number of shares of common stock included with the units sold | 10,088,336 | ' | ' | 1,092,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 666,667 | ' |
Number of shares of warrants included with the units sold | 10,088,336 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 666,667 | ' |
Term of warrants issued to accredited investor | '5 years | '3 years | ' | '3 years | '3 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | ' |
Exercise price of units (in dollars per share) | $0.40 | $0.40 | ' | $0.50 | $0.50 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.40 | ' |
Number of shares of common stock registered for resale under a registration statement | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 26,286,836 | ' | ' | ' | ' | ' | ' | ' |
Reverse stock split ratio | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of shares for every $10 of gross sales, for which warrant becomes exercisable | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Period considered for calculation of number of shares for every $10 of gross sales, for which warrant becomes exercisable | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '12 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common Stock, shares authorized | ' | ' | ' | ' | 100,000,000 | ' | 100,000,000 | 100,000,000 | 4,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | 250,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common Stock, shares authorized before amendment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock issued for exercise of warrants (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Proceeds from exercise of warrants | ' | ' | ' | ' | $47,750 | ' | ' | ' | ' | ' | ' | ' | ' | $13,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |