Stockholders' Deficit | NOTE 9 - STOCKHOLDERS DEFICIT Stock-Based Compensation During the nine months ended September 30, 2015 and 2014, the Company recognized stock-based compensation, including consultants, of approximately $0 and $46,711, to general and administrative expenses and $0 and $0 to project development expenses, respectively. There is no additional future compensation expense to record as of September 30, 2015 based on the previous awards. Equity Facility Agreement On March 28, 2012, BlueFire finalized a committed equity facility (the Equity Facility) with TCA Global Credit Master Fund, LP, a Cayman Islands limited partnership (TCA), whereby the parties entered into (i) a committed equity facility agreement (the Equity Agreement) and (ii) a registration rights agreement (the Registration Rights Agreement). Pursuant to the terms of the Equity Agreement, for a period of twenty-four (24) months commencing on the date of effectiveness of the Registration Statement (as defined below), TCA committed to purchase up to $2,000,000 of BlueFires common stock, par value $0.001 per share (the Shares), pursuant to Advances (as defined below), covering the Registrable Securities (as defined below). The purchase price of the Shares under the Equity Agreement is equal to ninety-five percent (95%) of the lowest daily volume weighted average price of BlueFires common stock during the five (5) consecutive trading days after BlueFire delivers to TCA an Advance notice in writing requiring TCA to advance funds (an Advance) to BlueFire, subject to the terms of the Equity Agreement. The Registrable Securities include (i) the Shares; and (ii) any securities issued or issuable with respect to the Shares by way of exchange, stock dividend or stock split or in connection with a combination of shares, recapitalization, merger, consolidation or other reorganization or otherwise. As further consideration for TCA entering into and structuring the Equity Facility, BlueFire paid to TCA a fee by issuing to TCA shares of BlueFires common stock that equal a dollar amount of $110,000 (the Facility Fee Shares). It is the intention of BlueFire and TCA that the value of the Facility Fee Shares shall equal $110,000. In the event the value of the Facility Fee Shares issued to TCA does not equal $110,000 after a nine month evaluation date, the Equity Agreement provides for an adjustment provision allowing for necessary action (either the issuance of additional shares to TCA or the return of shares previously issued to TCA to BlueFires treasury) to adjust the number of Facility Fee Shares issued. BlueFire also entered into the Registration Rights Agreement with TCA. Pursuant to the terms of the Registration Rights Agreement, BlueFire is obligated to file a registration statement (the Registration Statement) with the U.S. Securities and Exchange Commission (the SEC) to cover the Registrable Securities within 45 days of closing. BlueFire must use its commercially reasonable efforts to cause the Registration Statement to be declared effective by the SEC by a date that is no later than 90 days following closing. In connection with the issuance of approximately 280,000 shares for the $110,000 facility fee as described above, the Company capitalized said amount within deferred financings costs in the accompanying balance sheet as of March 31, 2012, along with other costs incurred as part Equity Facility and the Convertible Note described below. Additional costs related to the Equity Facility and paid from the funds of the Convertible Note described below, were approximately $60,000. Aggregate costs of the Equity Facility were $170,000. Because these costs were to access the Equity Facility, earned by TCA regardless of the Company drawing on the Equity Facility, and not part of a funding, they are treated akin to debt costs The deferred financings costs related to the Equity Facility were amortized over one (1) year on a straight-line basis. The Company believed this accelerated amortization, which is less than the two year Equity Facility term, was appropriate based on substantial doubt about the Companys ability to continue as a going concern. As of December 31, 2012, the Company determined that it was not probable the Registration Statement would become effective under the original structure of the agreement and accordingly, wrote off all remaining deferred financing costs related to the Equity Agreement. On March 28, 2012, BlueFire entered into a security agreement (the Security Agreement) with TCA, related to a $300,000 convertible promissory note issued by BlueFire in favor of TCA (the Convertible Note). The Security Agreement granted to TCA a continuing, first priority security interest in all of BlueFires assets, wheresoever located and whether now existing or hereafter arising or acquired. On March 28, 2012, BlueFire issued the Convertible Note in favor of TCA. The maturity date of the Convertible Note was March 28, 2013, and the Convertible Note bore interest at a rate of twelve percent (12%) per annum with a default rate of eighteen percent (18%) per annum. The Convertible Note was convertible into shares of BlueFires common stock at a price equal to ninety-five percent (95%) of the lowest daily volume weighted average price of BlueFires common stock during the five (5) trading days immediately prior to the date of conversion. The Convertible Note had the option to be prepaid in whole or in part at BlueFires option without penalty. The proceeds received by the Company under the purchase agreement were used for general working capital purposes which include costs reimbursed under the DOE cost share program. In connection with the Convertible Note, approximately $93,000 was withheld and immediately disbursed to cover costs of the Convertible Note and Equity Facility described above. The costs related to the Convertible Note were $24,800 which were capitalized as deferred financing costs; were amortized on a straight-line basis over the term of the Convertible Note. In addition, $7,500 was dispersed to cover legal fees. After all costs, the Company received approximately $207,000 in cash from the Convertible Note. There was no amortization of deferred financing costs during the nine months ended September 30, 2015 and 2014 was $0 and $0, respectively. As of September 30, 2015, there were no remaining deferred financing costs. This note contained an embedded conversion feature whereby the holder could convert the note at a discount to the fair value of the Companys common stock price. Based on applicable guidance the embedded conversion feature was considered a derivative instrument and bifurcated. This liability was recorded on the face of the financial statements as derivative liability, and was revalued each reporting period. During the nine months ended September 30, 2014, the note was repaid in full along with accrued interest and fees thereon. Accordingly, the remaining derivative liability of $13,189 was transferred to equity. On April 11, 2014, the Convertible Note with TCA was repaid in full. Liability Purchase Agreement On December 9, 2013, The Circuit Court of the Second Judicial Circuit in and for Leon County, Florida (the Court), entered an order (the Order) approving, among other things, the fairness of the terms and conditions of an exchange pursuant to Section 3(a)(10) of the Securities Act of 1933, in accordance with a stipulation of settlement (the Settlement Agreement) between the Company, and Tarpon Bay Partners, LLC, a Florida limited liability company (Tarpon), in the matter entitled Tarpon Bay Partners, LLC v. BlueFire Renewables, Inc., Case No. 2013-CA-2975 (the Action). Tarpon commenced the Action against the Company on November 21, 2013 to recover an aggregate of $583,710 of past-due accounts payable of the Company, which Tarpon had purchased from certain creditors of the Company pursuant to the terms of separate receivable purchase agreements between Tarpon and each of such vendors (the Assigned Accounts), plus fees and costs (the Claim). The Assigned Accounts relate to certain legal, accounting, financial services, and the repayment of aged debt. The Order provides for the full and final settlement of the Claim and the Action. The Settlement Agreement became effective and binding upon the Company and Tarpon upon execution of the Order by the Court on December 9, 2013. Notwithstanding anything to the contrary in the Stipulation, the number of shares beneficially owned by Tarpon will not exceed 9.99% of the Companys common stock. In connection with the Settlement Agreement, the Company relied on the exemption from registration provided by Section 3(a)(10) under the Securities Act. Pursuant to the terms of the Settlement Agreement approved by the Order, the Company shall issue and deliver to Tarpon shares (the Settlement Shares) of the Companys common stock in one or more tranches as necessary, and subject to adjustment and ownership limitations, sufficient to generate proceeds such that the aggregate Remittance Amount (as defined in the Settlement Agreement) equals the Claim. In addition, pursuant to the terms of the Settlement Agreement, the Company issued to Tarpon a convertible promissory note in the principal amount of $25,000 (the Tarpon Initial Note). Under the terms of the Tarpon Initial Note, the Company shall pay Tarpon $25,000 on the date of maturity which was January 30, 2014. This Note was convertible by Tarpon into the Companys common shares (See Note 4). Pursuant to the fairness hearing, the Order, and the Companys agreement with Tarpon, on December 23, 2013, the Company issued the Additional Tarpon Note in the principal amount of $50,000 in favor of Tarpon as a commitment fee. The Additional Tarpon Note was due on June 30, 2014. The Additional Tarpon Note was convertible into shares of the Companys common stock (See Note 4). In connection with the settlement, on December 18, 2013 the Company issued 6,619,835 shares of common stock to Tarpon in which gross proceeds of $29,802 were generated from the sale of the common stock. In connection with the transaction, Tarpon received fees of $7,450 and provided payments of $22,352 to settle outstanding vendor payables. During the nine months ended September 30, 2015 and 2014, the Company issued Tarpon 0 and 61,010,000 shares of common stock from which gross proceeds of $0 and $163,406, respectively, were generated from the sale of the common stock. In connection with the transaction, Tarpon received fees of $42,402 and provided payments of $121,004 to settle outstanding vendor payables during the nine months ended September 30, 2014. Shares in which are held by Tarpon at each reporting period are accounted for as issued but not outstanding. As of June 30, 2015, the Company has satisfied all of its liabilities under the Settlement Agreement. Kodiak Purchase Agreement and Registration Rights Agreement On December 17, 2014, the Company entered into the equity Purchase Agreement with Kodiak. Pursuant to the terms of the Purchase Agreement, for a period of twenty-four (24) months commencing on the date of effectiveness of the registration statement, Kodiak shall commit to purchase up to $1,500,000 of Put Shares, pursuant to Puts (as defined in the Purchase Agreement), covering the Registered Securities (as defined below). The Registered Securities means the (a) Put Shares, and (b) any securities issued or issuable with respect to any of the foregoing by way of exchange, stock dividend or stock split or in connection with a combination of shares, recapitalization, merger, consolidation or other reorganization or otherwise. As to any particular Registered Securities, once issued such securities shall cease to be Registered Securities when (i) a Registration Statement has been declared effective by the SEC and such Registered Securities have been disposed of pursuant to a Registration Statement, (ii) such Registered Securities have been sold under circumstances under which all of the applicable conditions of Rule 144 are met, (iii) such time as such Registered Securities have been otherwise transferred to holders who may trade such shares without restriction under the Securities Act or (iv) in the opinion of counsel to the Company, which counsel shall be reasonably acceptable to Investor, such Registered Securities may be sold without registration under the Securities Act or the need for an exemption from any such registration requirements and without any time, volume or manner limitations pursuant to Rule 144(b)(i) (or any similar provision then in effect) under the Securities Act. As further consideration for Kodiak entering into and structuring the Purchase Agreement, the Company issued Kodiak a promissory note for no consideration, in the principal aggregate amount of $60,000 (the Kodiak Note) that bears no interest and had a maturity date of July 17, 2015, although was subsequently changed (See Note 4). Concurrently with the Purchase Agreement, on December 17, 2014, the Company also entered into a registration rights agreement (the Registration Rights Agreement) with Kodiak. Pursuant to the terms of the Registration Rights Agreement, the Company is obligated to file a registration statement (the Registration Statement) with the SEC to cover the Registered Securities, within thirty (30) days of closing, and must use its commercially reasonable efforts to cause the Registration Statement to be declared effective by the SEC. The Registration was filed on January 2, 2015, and declared effective on February 11, 2015. On February 12, 2015, the Company issued a Put for 20,000,000 put shares. The lowest closing bid price during the valuation period was $0.0098. For the nine months ended September 30, 2015 and 2014, the Company received total funds, net of Kodiaks 25% discount, of $147,000 and $0, respectively. |