Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2016 | Oct. 28, 2016 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | BioSolar Inc | |
Entity Central Index Key | 1,371,128 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q3 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 27,004,806 |
Condensed Balance Sheets
Condensed Balance Sheets - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
CURRENT ASSETS | ||
Cash | $ 244,776 | $ 202,610 |
Prepaid expenses | 42,214 | 86,943 |
TOTAL CURRENT ASSETS | 286,990 | 289,553 |
PROPERTY AND EQUIPMENT | ||
Machinery and equipment | 28,855 | 28,855 |
Less accumulated depreciation | (19,530) | (17,326) |
NET PROPERTY AND EQUIPMENT | 9,325 | 11,529 |
OTHER ASSETS | ||
Patents | 72,254 | 70,270 |
Deposit | 770 | 770 |
TOTAL OTHER ASSETS | 73,024 | 71,040 |
TOTAL ASSETS | 369,339 | 372,122 |
CURRENT LIABILITIES | ||
Accounts payable | 15,556 | 2,055 |
Accrued expenses | 204,612 | 110,676 |
Derivative liability | 8,346,067 | 7,878,599 |
Related party convertible promissory notes net of debt discount of $35,980 and $46,354, respectively | 92,020 | 138,646 |
Convertible promissory notes net of debt discount of $180,028 and $232,645, respectively | 652,972 | 966,855 |
TOTAL CURRENT LIABILITIES | 9,311,227 | 9,096,831 |
LONG TERM LIABILITIES | ||
Convertible promissory notes | 891,700 | |
TOTAL LONG TERM LIABILITIES | 891,700 | |
TOTAL LIABILITIES | 10,202,927 | 9,096,831 |
SHAREHOLDERS' DEFICIT | ||
Preferred stock, $0.0001 par value; 10,000,000 authorized common shares | ||
Common stock, $0.0001 par value; 500,000,000 authorized common shares 26,016,608 and 17,995,953 shares issued and outstanding, respectively | 2,601 | 1,799 |
Additional paid in capital | 8,812,426 | 7,474,644 |
Accumulated deficit | (18,648,615) | (16,201,152) |
TOTAL SHAREHOLDERS' DECIFIT | (9,833,588) | (8,724,709) |
TOTAL LIABILITIES AND SHAREHOLDERS' DEFICIT | $ 369,339 | $ 372,122 |
Condensed Balance Sheets (Paren
Condensed Balance Sheets (Parenthetical) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Related party convertible promissory notes, debt discount | $ 35,980 | $ 46,354 |
Convertible promissory notes, debt discount | $ 180,028 | $ 232,645 |
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 26,016,608 | 17,995,953 |
Common stock, shares outstanding | 26,016,608 | 17,995,953 |
Condensed Statements of Operati
Condensed Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Income Statement [Abstract] | ||||
REVENUE | ||||
OPERATING EXPENSES | ||||
General and administrative expenses | 534,526 | 130,830 | 1,596,708 | 385,477 |
Research and development | 55,646 | 75,481 | 198,539 | 146,257 |
Depreciation and amortization | 672 | 2,105 | 2,204 | 6,304 |
TOTAL OPERATING EXPENSES | 590,844 | 208,416 | 1,797,451 | 538,038 |
LOSS FROM OPERATIONS BEFORE OTHER INCOME | (590,844) | (208,416) | (1,797,451) | (538,038) |
TOTAL OTHER INCOME/(EXPENSES) | ||||
Interest income | 15 | 12 | 45 | 31 |
Gain on sale of equipment | 9,862 | 9,862 | ||
Gain (loss) on conversion of debt and change in derivative liability | (502,473) | 7,692,906 | (179,194) | (9,646,439) |
Interest expense | (156,087) | (165,400) | (470,863) | (353,804) |
TOTAL OTHER(EXPENSES)/INCOME | (658,545) | 7,537,380 | (650,012) | (9,990,350) |
NET (LOSS)/INCOME | $ (1,249,389) | $ 7,328,964 | $ (2,447,463) | $ (10,528,388) |
BASIC AND DILUTED EARNINGS (LOSS) PER SHARE | $ (0.05) | $ 0.41 | $ (0.11) | $ (0.71) |
WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING BASIC AND DILUTED | 25,337,081 | 17,721,019 | 21,582,493 | 14,792,232 |
Condensed Statement of Sharehol
Condensed Statement of Shareholders' Equity Deficit (Unaudited) - 9 months ended Sep. 30, 2016 - USD ($) | Total | Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated Deficit |
Beginning balance at Dec. 31, 2015 | $ (8,724,709) | $ 1,799 | $ 7,474,644 | $ (16,201,152) | |
Beginning balance, Shares at Dec. 31, 2015 | 17,995,953 | ||||
Issuance of common shares for converted promissory notes and accrued interest | 94,067 | $ 745 | 93,322 | ||
Issuance of common shares for converted promissory notes and accrued interest, Shares | 7,449,438 | ||||
Issuance of common shares for related party converted promissory notes and accrued interest | 65,690 | $ 57 | 65,633 | ||
Issuance of common shares for related party converted promissory notes and accrued interest, Shares | 571,217 | ||||
Stock based compensation | 1,178,827 | 1,178,827 | |||
Net Loss | (2,447,463) | (2,447,463) | |||
Ending balance at Sep. 30, 2016 | $ (9,833,588) | $ 2,601 | $ 8,812,426 | $ (18,648,615) | |
Ending balance, Shares at Sep. 30, 2016 | 26,016,608 |
Condensed Statements of Cash Fl
Condensed Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net (loss)Income | $ (2,447,463) | $ (10,528,388) |
Adjustment to reconcile net loss to net cash used in operating activities | ||
Depreciation and amortization expense | 2,204 | 6,304 |
Stock based compensation | 1,178,827 | 53,354 |
Loss on net change in derivative liability and conversion of debt | 179,194 | 9,646,439 |
Amortization of debt discount recognized as interest expense | 351,265 | 279,532 |
(Gain) on sale of asset | (9,862) | |
(Increase) Decrease in: | ||
Prepaid expenses | 44,729 | (21,722) |
Increase (Decrease) in: | ||
Accounts payable | 13,500 | 52 |
Accrued expenses | 118,894 | 73,554 |
NET CASH USED IN OPERATING ACTIVITIES | (558,850) | (500,737) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchase of equipment | (759) | |
Proceeds from sale of asset | 23,000 | |
Patent expenditures | (1,984) | (8,964) |
NET CASH PROVIDED BY/(USED) IN INVESTING ACTIVITIES | (1,984) | 13,277 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from convertible promissory notes | 603,000 | 500,000 |
NET CASH PROVIDED BY FINANCING ACTIVITIES | 603,000 | 500,000 |
NET INCREASE IN CASH | 42,166 | 12,540 |
CASH, BEGINNING OF PERIOD | 202,610 | 146,640 |
CASH, END OF PERIOD | 244,776 | 159,180 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | ||
Interest paid | 704 | 719 |
Taxes paid | ||
SUPPLEMENTAL SCHEDULE OF NON-CASH TRANSACTIONS | ||
Common stock issued for convertible notes and accrued interest | $ 159,757 | $ 206,148 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2016 | |
Basis of Presentation [Abstract] | |
Basis of Presentation | 1. Basis of Presentation The accompanying unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all normal recurring adjustments considered necessary for a fair presentation have been included. Operating results for the nine months ended September 30, 2016 are not necessarily indicative of the results that may be expected for the year ending December 31, 2016. For further information refer to the financial statements and footnotes thereto included in the Company's Form 10-K for the year ended December 31, 2015. Going Concern The accompanying financial statements have been prepared on a going concern basis of accounting, which contemplates continuity of operations, realization of assets and liabilities and commitments in the normal course of business. The accompanying financial statements do not reflect any adjustments that might result if the Company is unable to continue as a going concern. The Company has not generated significant revenue, and has negative cash flows from operations, which raise substantial doubt about the Company’s ability to continue as a going concern. The ability of the Company to continue as a going concern and appropriateness of using the going concern basis is dependent upon, among other things, additional cash infusion. The Company has historically obtained funds through private placements offerings of equity and debt. Management believes that it will be able to continue to raise funds by sale of its securities to its existing shareholders and prospective new investors to provide the additional cash needed to meet the Company’s obligations as they become due, and will allow the development of its core of business. There is no assurance that the Company will be able to continue raising the required capital for its operations. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2016 | |
Summary of Significant Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES This summary of significant accounting policies of the Company are presented to assist in understanding the Company’s financial statements. The financial statements and notes are representations of the Company’s management, which is responsible for their integrity and objectivity. 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. Revenue Recognition The Company will recognize revenue when services are performed, and at the time of shipment of products, provided that evidence of an arrangement exists, title and risk of loss have passed to the customer, fees are fixed or determinable, and collection of the related receivable is reasonably assured. To date, the Company has not had significant revenues and is in the development stage. Cash and Cash Equivalent The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the accompanying financial statements. Significant estimates made in preparing these financial statements, include the estimate of useful lives of property and equipment, the deferred tax valuation allowance, derivative liabilities and the fair value of stock options. Actual results could differ from those estimates. Intangible Assets Intangible assets consist of patents that are initially measured at the lower of cost or fair value. The patents are deemed to have an indefinite life and are not amortized. The patents are assessed annually for impairment, or whenever conditions indicate the asset may be impaired, and any such impairment will be recognized in the period identified. Stock-Based Compensation The Company measures the cost of employee services received in exchange for an equity award based on the grant-date fair value of the award. All grants under our stock-based compensation programs are accounted for at fair value and that cost is recognized over the period during which an employee, consultant, or director are required to provide service in exchange for the award (the vesting period). Compensation expense for options granted to employees and non-employees is determined in accordance with the standard as the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measured. Compensation expense for awards granted is re-measured each period. Determining the appropriate fair value of the stock-based compensation requires the input of subjective assumptions, including the expected life of the stock-based payment and stock price volatility. The Company uses the Binomial option-pricing model to value its stock option awards which incorporate the Company’s stock price, volatility, U.S. risk-free rate, dividend rate, and estimated life. On March 24, 2015, the Company granted 2,450,000 stock options with an exercise price of $0.09 per share, and on September 2, 2015 the Company granted an additional 13,500,000 stock options with an exercise price of $0.26 per share. The options will vest 1/25 on a monthly basis starting April 24, 2015 and October 1, 2015, respectively, and terminate seven (7) years from the date of grant or upon termination of employment. Income (Loss) per Share Calculations Loss per Share dictates the calculation of basic earnings per share and diluted earnings per share are computed by dividing income available to common shareholders by the weighted-average number of common shares available. Diluted earnings per share is computed similar to basic earnings per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. The Company’s diluted loss per share is the same as the basic loss per share for the nine months ended September 30, 2016, as the inclusion of any potential shares would have had an anti-dilutive effect due to the Company generating a loss. The Company has excluded 15,975,000 options, 245,000 warrants, and the shares issuable from convertible debt of $1,852,700 for the nine months ended September 30, 2016. Fair Value of Financial Instruments Fair Value of Financial Instruments, requires disclosure of the fair value information, whether or not recognized in the balance sheet, where it is practicable to estimate that value. As of September 30, 2016, the amounts reported for cash, inventory, prepaid expenses, accounts payable, and accrued expenses, approximate the fair value because of their short maturities. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC Topic 820 established a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurements) and the lowest priority to unobservable inputs (level 3 measurements). These tiers include: ● Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets; ● Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and ● Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. We measure certain financial instruments at fair value on a recurring basis. Assets and liabilities measured at fair value on a recurring basis are as follows at September 30, 2016: Total (Level 1) (Level 2) (Level 3) Derivative Liability $ 8,346,067 $ - $ - $ 8,346,067 Total liabilities measured at fair value $ 8,346,067 $ - $ - $ 8,346,067 The following is a reconciliation of the derivative liability for which Level 3 inputs were used in determining the approximate fair value: Beginning balance as of January 1, 2016 $ 7,878,599 Fair value of derivative liabilities issued 288,274 Loss on conversion of debt and change in derivative liability 179,194 Ending balance as of September 30, 2016 $ 8,346,067 Recently Issued Accounting Pronouncements 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 condensed financial statements. In August 2014, FASB issued ASU 2014-15, “Presentation of Financial Statements Going Concern (Subtopic 205-40) – Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern”. Currently, there is no guidance in U.S. GAAP about management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern or to provide related footnote disclosures. The amendments in this ASU provide that guidance. In doing so, the amendments are intended to reduce diversity in the timing and content of footnote disclosures. The amendments require management to assess an Entity’s ability to continue as a going concern by incorporating and expanding upon certain principles that are currently in U.S. auditing standards. Specifically, the amendments (1) provide a definition of the term substantial doubt, (2) require an evaluation every reporting period including interim periods, (3) provide principles for considering the mitigating effect of management’s plans, (4) require certain disclosures when substantial doubt is alleviated as a result of consideration of management’s plans, (5) require an express statement and other disclosures when substantial doubt is not alleviated, and (6) require an assessment for a period of one year after the date that the financial statements are issued (or available to be issued). The amendments in this ASU are effective for public and nonpublic entities for annual periods ending after December 15, 2016. Early adoption is permitted. The Company is currently evaluating the impact of the adoption of ASU 2014-15 on the Company’s financial statements. In March 2016, FASB issued accounting standards update ASU-2016-09, “Compensation –Stock Compensation (Topic 718) – Improvements to Employee Share-Based Payment Accounting”. The amendments are intended to improve the accounting for employee share-based payments and affect all organizations that issue share-based payment awards to their employees. Several aspects of the accounting for share-based payments award transactions are simplified, including: (a) income tax consequences; (b) classification of awards as either equity or liabilities; and (c) classification on the statement of cash flows. For public companies, the amendments are effective for annual periods beginning after December 15, 2016, and interim periods within those annual periods. Early adoption is permitted for any organization in any interim or annual period. The Company is currently evaluating the impact of the adoption of ASU 2016-9 on the Company’s financial statements. In March 2016, FASB issued accounting standards update ASU-2016-06, “Derivatives and Hedging (Topic 815) – Contingent Put and Call Options in Debt Instruments”. The amendments apply to all entities that are issuers of or investors in debt instruments (or hybrid financial instruments that are determined to have a debt host) with embedded call (put) options. U.S. GAAP provides specific guidance for assessing whether call (put) options that can accelerate the repayment of principal on a debt instrument meet the clearly and closely related criterion. The guidance states that for contingent call (put) options to be considered clearly and closely related, they can be indexed only to interest rates or credit risk. Public companies must apply the new requirements for fiscal years beginning after December 15, 2016 and interim periods within those fiscal years. The Company is currently evaluation the impact of the adoption of ASU 2016-06 on the Company’s financial statements. In August 2016, FASB issued accounting standards update ASU-2016-15, “Statement of Cash Flows” (Topic 230) – Classification of Certain Cash Receipts and Cash Payments”, to address diversity in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The amendments in this ASU are effective for public and nonpublic entities for fiscal years beginning after December 15, 2018, and interim periods with fiscal years beginning after December 15, 2019. Early adoption is permitted, including adoption in an interim period. The Company is currently evaluating the impact of the adoption of ASU 2016-15 on the Company’s financial statements. |
Capital Stock
Capital Stock | 9 Months Ended |
Sep. 30, 2016 | |
Capital Stock [Abstract] | |
CAPITAL STOCK | 3. CAPITAL STOCK During the nine months ended September 30, 2016, the Company issued 7,449,437 shares of common stock at prices of $0.00847 and $0.0133 per share upon conversion of $77,800 in convertible promissory notes, including $16,267 in accrued interest. During the nine months ended September 30, 2016, the Company issued 571,217 shares of common stock at a price of $0.115 per share upon conversion of related party convertible promissory notes with a fair value of $57,000, plus accrued interest of $8,690. |
Stock Options and Warrants
Stock Options and Warrants | 9 Months Ended |
Sep. 30, 2016 | |
Stock Options and Warrants [Abstract] | |
STOCK OPTIONS AND WARRANTS | 4. STOCK OPTIONS AND WARRANTS During the nine months ended September 30, 2016, the Company did not grant any stock options. September 30, 2016 Weighted Number average of exercise Options price Outstanding, January 1, 2016 15,978,333 $ 0.23 Granted - - Exercised - - Expired (3,333 ) $ 4.05 Outstanding, September 30, 2016 15,975,000 $ 0.23 Exercisable at the end of period 8,269,0000 $ 0.22 The weighted average remaining contractual life of options outstanding as of September 30, 2016 was as follows: Weighted Average Stock Stock Remaining Exercisable Options Options Contractual Prices Outstanding Exercisable Life (years) 0.40 25,000 25,000 1.42 0.09 2,450,000 1,764,000 5.48 0.26 13,500,000 6,480,000 5.93 Total 15,975,000 8,269,000 The stock-based compensation expense recognized in the statement of operations during the nine months ended September 30, 2016 related to the granting of these options was $1,178,827. As of September 30, 2016, there was no intrinsic value with regards to the outstanding options. Warrants During the nine months ended September 30, 2016, the Company granted no warrants. As of September 30, 2016, 245,000 warrants are outstanding. The warrant terms are 5 years with 95,000 warrants expiring in October 2016 and 150,000 warrants expiring in October 2017. September 30, 2016 Weighted Number average of exercise Warrants price Outstanding, January 1, 2016 245,000 $ 0.97 Granted - - Exercised - - Expired - - Outstanding, September 30, 2016 245,000 $ 0.97 Exercisable at the end of period 245,000 $ 0.97 |
Convertible Promissory Notes
Convertible Promissory Notes | 9 Months Ended |
Sep. 30, 2016 | |
Convertible Promissory Notes [Abstract] | |
CONVERTIBLE PROMISSORY NOTES | 5. CONVERTIBLE PROMISSORY NOTES On January 18, 2013, the Company entered into a securities purchase agreement for the sale of 10% convertible promissory note in the aggregate principal amount of up to $80,000, to be advanced in amounts at the lender’s discretion. Upon execution of the securities purchase agreement, the Company received an advance of $10,000. On April 16, 2013, the Company received an additional advance of $25,000. The total advances received were $35,000, of which principal in the amount of $25,000, and $2,886 in accrued interest was converted into 183,481 shares of common stock at fair value of $0.43 and $0.367 per share on September 29, 2013 and October 3, 2014. On July 6, 2015 the Company issued 735,153 shares of common stock at a fair value of $0.0133 upon conversion of principal in the amount of $8,000, plus accrued interest of $1,778, leaving a balance of $2,000. During the month of July 2013, the Company extended the maturity date of the note from six (6) months to eighteen (18) months from the effective date of each advance. The note was fully converted on January 26, 2016, at which time the Company issued 192,193 shares of common stock. On May 2, 2014, the Company entered into a securities purchase agreement, providing for the sale by the Company of 10% unsecured convertible note in the aggregate principal amount of up to $500,000, to be advanced in amounts at the lender’s discretion. Upon execution of the securities purchase agreement, the Company received an advance in the amount of $50,000. On various dates, the Company received additional advances in the aggregate sum of $450,000, for a total aggregate sum of $500,000. As of December 31, 2015, the remaining principal balance was $467,500. During the nine months ended September 30, 2016, the Company issued 7,257,246 shares of common stock for principal in the amount of $75,800, plus accrued interest of $15,711, leaving a principal balance of $391,700. Each advance matures eighteen (18) months from the effective date of each advance, which was extended on January 12, 2016 to sixty (60) months, with maturity dates ranging from May 1, 2019 to December 21, 2019. The note is convertible into shares of common stock of the Company at a price equal to a variable conversion price of a) the lesser of $0.25 per share of common stock, b) fifty percent (50%) of the average three (3) lowest trading prices of three (3) separate trading days recorded after the effective date, or c) the lowest effective price granted to any person or entity after the effective date to acquire common stock. The fair value of the note has been determined by using the Binomial lattice formula with an expected life of sixty (60) months from the effective date of each advance. The Company recorded amortization of debt discount, which was recognized as interest expense in the amount of $23,097 during the nine months ended September 30, 2016. On January 30, 2015, the Company entered into a securities purchase agreement, providing for the sale by the Company of 10% unsecured convertible note in the aggregate principal amount of up to $500,000, to be advanced in amounts at the lender’s discretion. Upon execution of the securities purchase agreement, the Company received an advance in the amount of $50,000. On various dates, the Company received additional advances in the aggregate sum of $450,000. The principal balance at September 30, 2016 was $500,000. Each advance matured eighteen (18) months from the effective date of each advance, which was extended on January 12, 2016 to sixty (60) months, with maturity dates ranging from January 29, 2020 to August 25, 2020. The note is convertible into shares of common stock of the Company at a price equal to a variable conversion price of a) the lesser of $0.15 per share of common stock, b) fifty percent (50%) of the lowest trade price recorded since the original effective date of the note, or c) the lowest effective price per share granted to any person or entity after the effective date to acquire common stock. The fair value of the note has been determined by using the Binomial lattice formula with an expected life of sixty (60) months from the effective date of each advance. The Company recorded amortization of debt discount, which was recognized as interest expense in the amount of $83,230 during the nine months ended September 30, 2016. On October 1, 2015, the Company entered into a securities purchase agreement, providing for the sale by the Company of 10% unsecured convertible notes in the aggregate principal amount of up to $500,000, to be advanced in amounts at the lender’s discretion. Upon execution of the securities purchase agreement, the Company received an advance in the amount of $90,000. On various dates, the Company received additional advances in the aggregate sum of $395,000. The principal balance at September 30, 2016 was $485,000. Each advance matures twelve (12) months from the effective date of each advance. The note is convertible into shares of common stock of the Company at a price equal to a variable conversion price of a) the lesser of $0.25 per share of common stock, b) fifty percent (50%) of the lowest trade price recorded since the original effective date of the note, or c) the lowest effective price per share granted to any person or entity after the effective date to acquire common stock. The fair value of the note has been determined by using the Binomial lattice formula with an expected life of twelve (12) months. The Company recorded amortization of debt discount, which was recognized as interest expense in the amount of $140,211 during the nine months ended September 30, 2016. On April 5, 2016, the Company entered into a securities purchase agreement, providing for the sale by the Company of 10% unsecured convertible notes in the aggregate principal amount of up to $500,000, to be advanced in amounts at the lender’s discretion. Upon execution of the securities purchase agreement, the Company received an advance in the amount of $48,000. On various dates, the Company received additional advances in the aggregate sum of $300,000. The principal balance at September 30, 2016 was $348,000. Each advance matures twelve (12) months from the effective date of each advance. The note is convertible into shares of common stock of the Company at a price equal to a variable conversion price of a) the lesser of $0.13 per share of common stock, b) fifty percent (50%) of the lowest trade price recorded since the original effective date of the note, or c) the lowest effective price per share granted to any person or entity after the effective date to acquire common stock. The fair value of the note has been determined by using the Binomial lattice formula with an expected life of twelve (12) months. The Company recorded amortization of debt discount, which was recognized as interest expense in the amount of $60,214 during the nine months ended September 30, 2016. RELATED PARTY CONVERTIBLE PROMISSORY NOTES On June 5, 2013, the Company issued two 5% convertible promissory notes in exchange for services rendered by the Company’s Chief Executive Officer ($114,000) and Chief Technology Officer ($128,000) in the aggregate amount of $242,000. On March 5, 2014, the Company issued 694,191 upon partial conversion of principal in the amount of $55,000, plus accrued interest of $2,063, leaving a remaining balance of $187,000. On April 17, 2015, the Company issued 2,187,692 shares of common stock upon conversion of $130,000 in principal, plus $12,200 in accrued interest, leaving a balance of $57,000. On June 20, 2016, the Company issued 571,217 shares of common stock upon conversion of $57,000 in principal, plus $8,960 in accrued interest. As of September 30, 2016 the note was fully converted. The fair value of the notes has been determined by using the Binomial lattice formula with an expected life of two (2) years. On December 18, 2014, the Company issued two 5% convertible promissory notes in exchange for services rendered by the Company’s Chief Executive Officer ($67,000) and Chief Technology Officer ($61,000) in the aggregate amount of $128,000. The notes are convertible into shares of common stock of the Company at a conversion price equal to the lesser of $0.101 per share of common stock or the closing price per share of common stock recorded on the trading day immediately preceding the date of conversion. The notes mature two (2) years from their effective dates. The fair value of the notes has been determined by using the Binomial lattice formula with an expected life of two (2) years. The Company recorded amortization of debt discount, which was recognized as interest expense in the amount of $35,980 during the nine months ended September 30, 2016. We evaluated the financing transactions in accordance with ASC Topic 815, Derivatives and Hedging, and determined that the conversion feature of the convertible promissory note was not afforded the exemption for conventional convertible instruments due to its variable conversion rate. The note has no explicit limit on the number of shares issuable so they did not meet the conditions set forth in current accounting standards for equity classification. The Company elected to recognize the note under paragraph 815-15-25-4, whereby, there would be a separation into a host contract and derivative instrument. The Company elected to initially and subsequently measure the note in its entirety at fair value, with changes in fair value recognized in earnings. The Company recorded a derivative liability representing the imputed interest associated with the embedded derivative. The derivative liability is adjusted periodically according to the stock price fluctuations. |
Derivative Liabilities
Derivative Liabilities | 9 Months Ended |
Sep. 30, 2016 | |
Derivative Liabilities [Abstract] | |
DERIVATIVE LIABILITIES | 6. DERIVATIVE LIABILITIES The convertible notes issued and described in Note 5 do not have fixed settlement provisions because their conversion prices are not fixed. The conversion feature has been characterized as derivative liabilities to be re-measured at the end of every reporting period with the change in value reported in the statement of operations. During the nine months ended September 30, 2016, as a result of the convertible notes (“Notes”) issued that were accounted for as derivative liabilities, we determined that the fair value of the conversion feature of the convertible notes at issuance was $288,274, based upon a Binomial-Model calculation. We recorded the full value of the derivative as a liability at issuance with an offset to valuation discount, which will be amortized over the life of the Notes. During the nine months ended September 30, 2016, approximately $134,800 convertible notes were converted. As a result of the conversion of these notes and the change in fair value of the remaining notes, the Company recorded a loss on net change in derivative and conversion of debt in the amount of $179,194 in the statement of operations for the nine months ended September 30, 2016. At September 30, 2016, the fair value of the derivative liability was $8,346,067. For purpose of determining the fair market value of the derivative liability for the embedded conversion, the Company used the Binomial lattice valuation model. The significant assumptions used in the Binomial lattice valuation model for the derivative are as follows: 9/30/2016 Risk free interest rate 0.29% - 1.40% Stock volatility factor 16.93% - 184.98% Weighted average expected option life 1 month - 5 years Expected dividend yield None |
Commitment and Contingencies
Commitment and Contingencies | 9 Months Ended |
Sep. 30, 2016 | |
Commitment and Contingencies [Abstract] | |
COMMITMENT AND CONTINGENCIES | 7. COMMITMENT AND CONTINGENCIES During the nine months ended September 30, 2016, we have a new material commitment for capital expenditures in the form of a sponsored research agreement with North Carolina Agricultural and Technical State University during the next twelve months. The contract period is from September 12, 2016 through September 11, 2017 and the total cost shall not exceed the sum of $123,993. The commitment shall be financed by the issuance of equity or debt securities. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2016 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 8. SUBSEQUENT EVENT Management has evaluated subsequent events according to the requirements of ASC TOPIC 855 and has determined that there are the following subsequent events: On October 11, 2016, the Company received a $50,000 advance on a securities purchase agreement entered into on April 8, 2016. The securities purchase agreement provides for the issuance of a 10 % unsecured convertible note in the aggregate principal amount of up to $500,000. The note is convertible into shares of common stock of the Company at a price equal to a variable conversion price of a) the lesser of $0.13 per share of common stock, b) fifty percent (50%) of the lowest trade price recorded on any trade day after the effective date or c) the lowest effective price per share granted to any person or entity after the effective date to acquire common stock. Effective October 1, 2015, the Company issued a convertible promissory note, which had an initial maturity date of October 1, 2016. On October 13, 2016, the Company and the borrower agreed to amend the convertible promissory note to extend the maturity date to sixty (60) months from the effective date of the note. On October 26, 2016, the Company issued 988,198 shares of common stock upon conversion of the convertible promissory note in the amount of principal of $6,700, plus accrued interest of $1667. |
Summary of Significant Accoun15
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Summary of Significant Accounting Policies [Abstract] | |
Revenue Recognition | Revenue Recognition The Company will recognize revenue when services are performed, and at the time of shipment of products, provided that evidence of an arrangement exists, title and risk of loss have passed to the customer, fees are fixed or determinable, and collection of the related receivable is reasonably assured. To date, the Company has not had significant revenues and is in the development stage. |
Cash and Cash Equivalent | Cash and Cash Equivalent The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the accompanying financial statements. Significant estimates made in preparing these financial statements, include the estimate of useful lives of property and equipment, the deferred tax valuation allowance, derivative liabilities and the fair value of stock options. Actual results could differ from those estimates. |
Intangible Assets | Intangible Assets Intangible assets consist of patents that are initially measured at the lower of cost or fair value. The patents are deemed to have an indefinite life and are not amortized. The patents are assessed annually for impairment, or whenever conditions indicate the asset may be impaired, and any such impairment will be recognized in the period identified. |
Stock-Based Compensation | Stock-Based Compensation The Company measures the cost of employee services received in exchange for an equity award based on the grant-date fair value of the award. All grants under our stock-based compensation programs are accounted for at fair value and that cost is recognized over the period during which an employee, consultant, or director are required to provide service in exchange for the award (the vesting period). Compensation expense for options granted to employees and non-employees is determined in accordance with the standard as the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measured. Compensation expense for awards granted is re-measured each period. Determining the appropriate fair value of the stock-based compensation requires the input of subjective assumptions, including the expected life of the stock-based payment and stock price volatility. The Company uses the Binomial option-pricing model to value its stock option awards which incorporate the Company’s stock price, volatility, U.S. risk-free rate, dividend rate, and estimated life. On March 24, 2015, the Company granted 2,450,000 stock options with an exercise price of $0.09 per share, and on September 2, 2015 the Company granted an additional 13,500,000 stock options with an exercise price of $0.26 per share. The options will vest 1/25 on a monthly basis starting April 24, 2015 and October 1, 2015, respectively, and terminate seven (7) years from the date of grant or upon termination of employment. |
Income (Loss) per Share Calculations | Income (Loss) per Share Calculations Loss per Share dictates the calculation of basic earnings per share and diluted earnings per share are computed by dividing income available to common shareholders by the weighted-average number of common shares available. Diluted earnings per share is computed similar to basic earnings per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. The Company’s diluted loss per share is the same as the basic loss per share for the nine months ended September 30, 2016, as the inclusion of any potential shares would have had an anti-dilutive effect due to the Company generating a loss. The Company has excluded 15,975,000 options, 245,000 warrants, and the shares issuable from convertible debt of $1,852,700 for the nine months ended September 30, 2016. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair Value of Financial Instruments, requires disclosure of the fair value information, whether or not recognized in the balance sheet, where it is practicable to estimate that value. As of September 30, 2016, the amounts reported for cash, inventory, prepaid expenses, accounts payable, and accrued expenses, approximate the fair value because of their short maturities. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC Topic 820 established a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurements) and the lowest priority to unobservable inputs (level 3 measurements). These tiers include: ● Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets; ● Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and ● Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. We measure certain financial instruments at fair value on a recurring basis. Assets and liabilities measured at fair value on a recurring basis are as follows at September 30, 2016: Total (Level 1) (Level 2) (Level 3) Derivative Liability $ 8,346,067 $ - $ - $ 8,346,067 Total liabilities measured at fair value $ 8,346,067 $ - $ - $ 8,346,067 The following is a reconciliation of the derivative liability for which Level 3 inputs were used in determining the approximate fair value: Beginning balance as of January 1, 2016 $ 7,878,599 Fair value of derivative liabilities issued 288,274 Loss on conversion of debt and change in derivative liability 179,194 Ending balance as of September 30, 2016 $ 8,346,067 |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements 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 condensed financial statements. In August 2014, FASB issued ASU 2014-15, “Presentation of Financial Statements Going Concern (Subtopic 205-40) – Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern”. Currently, there is no guidance in U.S. GAAP about management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern or to provide related footnote disclosures. The amendments in this ASU provide that guidance. In doing so, the amendments are intended to reduce diversity in the timing and content of footnote disclosures. The amendments require management to assess an Entity’s ability to continue as a going concern by incorporating and expanding upon certain principles that are currently in U.S. auditing standards. Specifically, the amendments (1) provide a definition of the term substantial doubt, (2) require an evaluation every reporting period including interim periods, (3) provide principles for considering the mitigating effect of management’s plans, (4) require certain disclosures when substantial doubt is alleviated as a result of consideration of management’s plans, (5) require an express statement and other disclosures when substantial doubt is not alleviated, and (6) require an assessment for a period of one year after the date that the financial statements are issued (or available to be issued). The amendments in this ASU are effective for public and nonpublic entities for annual periods ending after December 15, 2016. Early adoption is permitted. The Company is currently evaluating the impact of the adoption of ASU 2014-15 on the Company’s financial statements. In March 2016, FASB issued accounting standards update ASU-2016-09, “Compensation –Stock Compensation (Topic 718) – Improvements to Employee Share-Based Payment Accounting”. The amendments are intended to improve the accounting for employee share-based payments and affect all organizations that issue share-based payment awards to their employees. Several aspects of the accounting for share-based payments award transactions are simplified, including: (a) income tax consequences; (b) classification of awards as either equity or liabilities; and (c) classification on the statement of cash flows. For public companies, the amendments are effective for annual periods beginning after December 15, 2016, and interim periods within those annual periods. Early adoption is permitted for any organization in any interim or annual period. The Company is currently evaluating the impact of the adoption of ASU 2016-9 on the Company’s financial statements. In March 2016, FASB issued accounting standards update ASU-2016-06, “Derivatives and Hedging (Topic 815) – Contingent Put and Call Options in Debt Instruments”. The amendments apply to all entities that are issuers of or investors in debt instruments (or hybrid financial instruments that are determined to have a debt host) with embedded call (put) options. U.S. GAAP provides specific guidance for assessing whether call (put) options that can accelerate the repayment of principal on a debt instrument meet the clearly and closely related criterion. The guidance states that for contingent call (put) options to be considered clearly and closely related, they can be indexed only to interest rates or credit risk. Public companies must apply the new requirements for fiscal years beginning after December 15, 2016 and interim periods within those fiscal years. The Company is currently evaluation the impact of the adoption of ASU 2016-06 on the Company’s financial statements. In August 2016, FASB issued accounting standards update ASU-2016-15, “Statement of Cash Flows” (Topic 230) – Classification of Certain Cash Receipts and Cash Payments”, to address diversity in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The amendments in this ASU are effective for public and nonpublic entities for fiscal years beginning after December 15, 2018, and interim periods with fiscal years beginning after December 15, 2019. Early adoption is permitted, including adoption in an interim period. The Company is currently evaluating the impact of the adoption of ASU 2016-15 on the Company’s financial statements. |
Summary of Significant Accoun16
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Summary of Significant Accounting Policies [Abstract] | |
Schedule of assets and liabilities measured at fair value on recurring basis | Total (Level 1) (Level 2) (Level 3) Derivative Liability $ 8,346,067 $ - $ - $ 8,346,067 Total liabilities measured at fair value $ 8,346,067 $ - $ - $ 8,346,067 |
Schedule of reconciliation of derivative liability | Beginning balance as of January 1, 2016 $ 7,878,599 Fair value of derivative liabilities issued 288,274 Loss on conversion of debt and change in derivative liability 179,194 Ending balance as of September 30, 2016 $ 8,346,067 |
Stock Options and Warrants (Tab
Stock Options and Warrants (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Stock Options and Warrants [Abstract] | |
Schedule of stock options activity | September 30, 2016 Weighted Number average of exercise Options price Outstanding, January 1, 2016 15,978,333 $ 0.23 Granted - - Exercised - - Expired (3,333 ) $ 4.05 Outstanding, September 30, 2016 15,975,000 $ 0.23 Exercisable at the end of period 8,269,0000 $ 0.22 |
Schedule of weighted average remaining contractual life of options outstanding | Weighted Average Stock Stock Remaining Exercisable Options Options Contractual Prices Outstanding Exercisable Life (years) 0.40 25,000 25,000 1.42 0.09 2,450,000 1,764,000 5.48 0.26 13,500,000 6,480,000 5.93 Total 15,975,000 8,269,000 |
Schedule of Warrants | September 30, 2016 Weighted Number average of exercise Warrants price Outstanding, January 1, 2016 245,000 $ 0.97 Granted - - Exercised - - Expired - - Outstanding, September 30, 2016 245,000 $ 0.97 Exercisable at the end of period 245,000 $ 0.97 |
Derivative Liabilities (Tables)
Derivative Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Derivative Liabilities [Abstract] | |
Schedule of derivative liabilities valuation assumptions | 9/30/2016 Risk free interest rate 0.29% - 1.40% Stock volatility factor 16.93% - 184.98% Weighted average expected option life 1 month - 5 years Expected dividend yield None |
Summary of Significant Accoun19
Summary of Significant Accounting Policies (Details) | Sep. 30, 2016USD ($) |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Derivative Liability | $ 8,346,067 |
Total liabilities measured at fair value | 8,346,067 |
Level 1 [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Derivative Liability | |
Total liabilities measured at fair value | |
Level 2 [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Derivative Liability | |
Total liabilities measured at fair value | |
Level 3 [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Derivative Liability | 8,346,067 |
Total liabilities measured at fair value | $ 8,346,067 |
Summary of Significant Accoun20
Summary of Significant Accounting Policies (Details 1) | 9 Months Ended |
Sep. 30, 2016USD ($) | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Beginning balance as of January 1, 2016 | $ 7,878,599 |
Ending balance as of September 30, 2016 | 8,346,067 |
Level 3 [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Beginning balance as of January 1, 2016 | 7,878,599 |
Fair value of derivative liabilities issued | 288,274 |
Loss on conversion of debt and change in derivative liability | (179,194) |
Ending balance as of September 30, 2016 | $ 8,346,067 |
Summary of Significant Accoun21
Summary of Significant Accounting Policies (Details Textual) - USD ($) | Sep. 02, 2015 | Mar. 24, 2015 | Sep. 30, 2016 |
Summary of Significant Accounting Policies (Textual) | |||
Number of options granted | |||
Exercise price | |||
Warrant [Member] | |||
Summary of Significant Accounting Policies (Textual) | |||
Antidilutive securities excluded from computation of earnings per share, amount | 245,000 | ||
Convertible Debt Securities [Member] | |||
Summary of Significant Accounting Policies (Textual) | |||
Antidilutive securities excluded from computation of earnings per share amount, value | $ 1,852,700 | ||
Stock Option [Member] | |||
Summary of Significant Accounting Policies (Textual) | |||
Number of options granted | 13,500,000 | 2,450,000 | |
Exercise price | $ 0.26 | $ 0.09 | |
Stock options vesting rights | The options will vest 1/25 on a monthly basis starting April 24, 2015 and October 1, 2015, respectively. | ||
Expiration period | 7 years | ||
Antidilutive securities excluded from computation of earnings per share, amount | 15,975,000 |
Capital Stock (Details)
Capital Stock (Details) | 9 Months Ended |
Sep. 30, 2016USD ($)$ / sharesshares | |
Capital Stock (Textual) | |
Common stock issued | shares | 7,449,437 |
Common stock conversion price per share | $ / shares | $ 0.0133 |
Common stock price per share | $ / shares | $ 0.00847 |
Amount of debt conversion | $ 77,800 |
Accrued interest | $ 16,267 |
Related Party [Member] | |
Capital Stock (Textual) | |
Common stock issued | shares | 571,217 |
Common stock conversion price per share | $ / shares | $ 0.115 |
Amount of debt conversion | $ 57,000 |
Accrued interest | $ 8,690 |
Stock Options and Warrants (Det
Stock Options and Warrants (Details) | 9 Months Ended |
Sep. 30, 2016$ / sharesshares | |
Number of Options | |
Beginning of period | shares | 15,978,333 |
Granted | shares | |
Exercised | shares | |
Expired | shares | (3,333) |
End of period | shares | 15,975,000 |
Exercisable at the end of period | shares | 82,690,000 |
Weighted average exercise price | |
Beginning of period | $ / shares | $ 0.23 |
Granted | $ / shares | |
Exercised | $ / shares | |
Expired | $ / shares | 4.05 |
End of period | $ / shares | 0.23 |
Exercisable at the end of period | $ / shares | $ 0.22 |
Stock Options and Warrants (D24
Stock Options and Warrants (Details 1) | 9 Months Ended |
Sep. 30, 2016$ / sharesshares | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Stock Options Outstanding | 15,975,000 |
Stock Options Exercisable | 8,269,000 |
0.40 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercisable Prices | $ / shares | $ 0.40 |
Stock Options Outstanding | 25,000 |
Stock Options Exercisable | 25,000 |
Weighted Average Remaining Contractual Life (years) | 1 year 5 months 1 day |
0.09 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercisable Prices | $ / shares | $ 0.09 |
Stock Options Outstanding | 2,450,000 |
Stock Options Exercisable | 1,764,000 |
Weighted Average Remaining Contractual Life (years) | 5 years 5 months 23 days |
0.26 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercisable Prices | $ / shares | $ 0.26 |
Stock Options Outstanding | 13,500,000 |
Stock Options Exercisable | 6,480,000 |
Weighted Average Remaining Contractual Life (years) | 5 years 11 months 5 days |
Stock Options and Warrants (D25
Stock Options and Warrants (Details 2) | 9 Months Ended |
Sep. 30, 2016$ / sharesshares | |
Number of Warrants | |
Beginning period | shares | 245,000 |
Granted | shares | |
Exercised | shares | |
Expired | shares | |
End of period | shares | 245,000 |
Exercisable at the end of period | shares | 245,000 |
Weighted average exercise price | |
Beginning of period | $ / shares | $ 0.97 |
Granted | $ / shares | |
Exercised | $ / shares | |
Expired | $ / shares | |
End of period | $ / shares | 0.97 |
Exercisable at the end of period | $ / shares | $ 0.97 |
Stock Options and Warrants (D26
Stock Options and Warrants (Details Textual) - USD ($) | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Stock Options and Warrants (Textual) | ||
Stock based compensation | $ 1,178,827 | $ 53,354 |
Intrinsic value of options outstanding | ||
Warrants outstanding | 245,000 | |
Term of warrant | 5 years | |
October 2016 [Member] | ||
Stock Options and Warrants (Textual) | ||
Warrants outstanding | 95,000 | |
October 2017 [Member] | ||
Stock Options and Warrants (Textual) | ||
Warrants outstanding | 150,000 |
Convertible Promissory Notes (D
Convertible Promissory Notes (Details) - USD ($) | Jun. 20, 2016 | Apr. 05, 2016 | Oct. 01, 2015 | Jul. 06, 2015 | Apr. 17, 2015 | Jan. 30, 2015 | Dec. 18, 2014 | May 02, 2014 | Mar. 05, 2014 | Jan. 26, 2016 | Apr. 16, 2013 | Jan. 18, 2013 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | Oct. 03, 2014 | Sep. 29, 2013 | Jun. 05, 2013 |
Convertible Promissory Notes (Textual) | ||||||||||||||||||
Advances received | $ 603,000 | $ 500,000 | ||||||||||||||||
Accrued interest | $ 16,267 | |||||||||||||||||
Common stock conversion price per share | $ 0.0133 | |||||||||||||||||
Common stock issued | 7,449,437 | |||||||||||||||||
Amortization of debt discount recognized as interest expense | $ 351,265 | $ 279,532 | ||||||||||||||||
10% Convertible promissory note [Member] | ||||||||||||||||||
Convertible Promissory Notes (Textual) | ||||||||||||||||||
Convertible promissory note interest, Percentage | 10.00% | |||||||||||||||||
Convertible promissory note principal amount | $ 2,000 | $ 80,000 | ||||||||||||||||
Advances received | $ 35,000 | $ 10,000 | ||||||||||||||||
Additional advances received | 25,000 | |||||||||||||||||
Principal amount converted | 8,000 | 25,000 | ||||||||||||||||
Accrued interest | $ 1,778 | $ 2,886 | ||||||||||||||||
Common stock conversion price per share | $ 0.0133 | $ 0.367 | $ 0.43 | |||||||||||||||
Common stock issued | 735,153 | 192,193 | 183,481 | |||||||||||||||
Debt instrument, description | During the month of July 2013, the Company extended the maturity date of the note from six (6) months to eighteen (18) months from the effective date of each advance. | |||||||||||||||||
Debt conversion, description | The note was fully converted on January 26, 2016, at which time the Company issued 1,461,545 shares of common stock. | |||||||||||||||||
10% Unsecured convertible note [Member] | ||||||||||||||||||
Convertible Promissory Notes (Textual) | ||||||||||||||||||
Convertible promissory note interest, Percentage | 10.00% | |||||||||||||||||
Unsecured convertible note principal amount | $ 500,000 | $ 391,700 | $ 467,500 | |||||||||||||||
Advances received | $ 50,000 | 500,000 | ||||||||||||||||
Additional advances received | $ 450,000 | |||||||||||||||||
Principal amount converted | 75,800 | |||||||||||||||||
Accrued interest | $ 15,711 | |||||||||||||||||
Common stock issued | 7,257,246 | |||||||||||||||||
Amortization of debt discount recognized as interest expense | $ 23,097 | |||||||||||||||||
Debt instrument, description | Each advance matures eighteen (18) months from the effective date of each advance, which was extended on January 12, 2016 to sixty (60) months, with maturity dates ranging from May 1, 2019 to December 21, 2019. | |||||||||||||||||
Debt conversion, description | The note is convertible into shares of common stock of the Company at a price equal to a variable conversion price of a) the lesser of $0.25 per share of common stock, b) fifty percent (50%) of the average three (3) lowest trading prices of three (3) separate trading days recorded after the effective date, or c) the lowest effective price granted to any person or entity after the effective date to acquire common stock. The fair value of the note has been determined by using the Binomial lattice formula with an expected life of sixty (60) months from the effective date of each advance. | |||||||||||||||||
10% Unsecured convertible note one [Member] | ||||||||||||||||||
Convertible Promissory Notes (Textual) | ||||||||||||||||||
Convertible promissory note interest, Percentage | 10.00% | |||||||||||||||||
Unsecured convertible note principal amount | $ 500,000 | $ 500,000 | ||||||||||||||||
Advances received | $ 50,000 | |||||||||||||||||
Additional advances received | 450,000 | |||||||||||||||||
Amortization of debt discount recognized as interest expense | $ 83,230 | |||||||||||||||||
Debt instrument, description | Each advance matured eighteen (18) months from the effective date of each advance, which was extended on January 12, 2016 to sixty (60) months, with maturity dates ranging from January 29, 2020 to August 25, 2020. | |||||||||||||||||
Debt conversion, description | The note is convertible into shares of common stock of the Company at a price equal to a variable conversion price of a) the lesser of $0.15 per share of common stock, b) fifty percent (50%) of the lowest trade price recorded since the original effective date of the note, or c) the lowest effective price per share granted to any person or entity after the effective date to acquire common stock. The fair value of the note has been determined by using the Binomial lattice formula with an expected life of sixty (60) months from the effective date of each advance. | |||||||||||||||||
10% Unsecured convertible notes two [Member] | ||||||||||||||||||
Convertible Promissory Notes (Textual) | ||||||||||||||||||
Convertible promissory note interest, Percentage | 10.00% | |||||||||||||||||
Unsecured convertible note principal amount | $ 500,000 | $ 485,000 | ||||||||||||||||
Advances received | $ 90,000 | |||||||||||||||||
Additional advances received | 395,000 | |||||||||||||||||
Amortization of debt discount recognized as interest expense | $ 140,211 | |||||||||||||||||
Debt instrument, description | Each advance matures twelve (12) months from the effective date of each advance. | |||||||||||||||||
Debt conversion, description | The note is convertible into shares of common stock of the Company at a price equal to a variable conversion price of a) the lesser of $0.25 per share of common stock, b) fifty percent (50%) of the lowest trade price recorded since the original effective date of the note, or c) the lowest effective price per share granted to any person or entity after the effective date to acquire common stock. The fair value of the note has been determined by using the Binomial lattice formula with an expected life of twelve (12) months. | |||||||||||||||||
10% unsecured convertible notes three [Member] | ||||||||||||||||||
Convertible Promissory Notes (Textual) | ||||||||||||||||||
Convertible promissory note interest, Percentage | 10.00% | |||||||||||||||||
Unsecured convertible note principal amount | $ 500,000 | |||||||||||||||||
Advances received | 48,000 | |||||||||||||||||
Additional advances received | $ 300,000 | |||||||||||||||||
Principal amount converted | $ 348,000 | |||||||||||||||||
Amortization of debt discount recognized as interest expense | $ 60,214 | |||||||||||||||||
Debt instrument, description | Each advance matures twelve (12) months from the effective date of each advance. | |||||||||||||||||
Debt conversion, description | The note is convertible into shares of common stock of the Company at a price equal to a variable conversion price of a) the lesser of $0.13 per share of common stock, b) fifty percent (50%) of the lowest trade price recorded since the original effective date of the note, or c) the lowest effective price per share granted to any person or entity after the effective date to acquire common stock. The fair value of the note has been determined by using the Binomial lattice formula with an expected life of twelve (12) months. | |||||||||||||||||
5% Convertible promissory notes one [Member] | ||||||||||||||||||
Convertible Promissory Notes (Textual) | ||||||||||||||||||
Convertible promissory note principal amount | $ 57,000 | $ 187,000 | $ 242,000 | |||||||||||||||
Principal amount converted | $ 57,000 | 130,000 | 55,000 | |||||||||||||||
Accrued interest | $ 8,960 | $ 12,200 | $ 2,063 | |||||||||||||||
Common stock issued | 571,217 | 2,187,692 | 694,191 | |||||||||||||||
Debt conversion, description | The fair value of the notes has been determined by using the Binomial lattice formula with an expected life of two (2) years. | |||||||||||||||||
5% Convertible promissory notes one [Member] | Chief Executive Officer (Member) | ||||||||||||||||||
Convertible Promissory Notes (Textual) | ||||||||||||||||||
Convertible promissory note interest, Percentage | 5.00% | |||||||||||||||||
Convertible promissory note principal amount | $ (114,000) | |||||||||||||||||
5% Convertible promissory notes one [Member] | Chief Technology Officer (Member) | ||||||||||||||||||
Convertible Promissory Notes (Textual) | ||||||||||||||||||
Convertible promissory note principal amount | $ (128,000) | |||||||||||||||||
5% convertible promissory note two [Member] | ||||||||||||||||||
Convertible Promissory Notes (Textual) | ||||||||||||||||||
Convertible promissory note principal amount | $ 128,000 | |||||||||||||||||
Accrued interest | $ 35,980 | |||||||||||||||||
Common stock conversion price per share | $ 0.101 | |||||||||||||||||
Debt instrument, description | The notes mature two (2) years from their effective dates. | |||||||||||||||||
Debt conversion, description | The fair value of the notes has been determined by using the Binomial lattice formula with an expected life of two (2) years. | |||||||||||||||||
5% convertible promissory note two [Member] | Chief Executive Officer (Member) | ||||||||||||||||||
Convertible Promissory Notes (Textual) | ||||||||||||||||||
Convertible promissory note interest, Percentage | 5.00% | |||||||||||||||||
Convertible promissory note principal amount | $ (67,000) | |||||||||||||||||
5% convertible promissory note two [Member] | Chief Technology Officer (Member) | ||||||||||||||||||
Convertible Promissory Notes (Textual) | ||||||||||||||||||
Convertible promissory note principal amount | $ (61,000) |
Derivative Liabilities (Details
Derivative Liabilities (Details) | 9 Months Ended |
Sep. 30, 2016 | |
Expected dividend yield | |
Minimum [Member] | |
Risk free interest rate | 0.29% |
Stock volatility factor | 16.93% |
Weighted average expected option life | 1 month |
Maximum [Member] | |
Risk free interest rate | 1.40% |
Stock volatility factor | 184.98% |
Weighted average expected option life | 5 years |
Derivative Liabilities (Detai29
Derivative Liabilities (Details Textual) - USD ($) | 9 Months Ended | |
Sep. 30, 2016 | Dec. 31, 2015 | |
Derivative Liabilities (Textual) | ||
Fair value of the derivative liability | $ 8,346,067 | $ 7,878,599 |
Convertible notes [Member] | ||
Derivative Liabilities (Textual) | ||
Fair value of the conversion feature | 288,274 | |
Amount of debt conversion | 134,800 | |
Gain on change in derivative liability | $ 179,194 |
Commitment and Contingencies (D
Commitment and Contingencies (Details) | 9 Months Ended |
Sep. 30, 2016 | |
Commitment And Contingencies (Textual) | |
Description of commitment | The contract period is from September 12, 2016 through September 11, 2017 and the total cost shall not exceed the sum of $123,993. |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | Oct. 26, 2016 | Oct. 11, 2016 | Oct. 13, 2016 | Sep. 30, 2016 |
Subsequent Event (Textual) | ||||
Common stock issued | 7,449,437 | |||
Amount of debt conversion | $ 77,800 | |||
Subsequent Event [Member] | 10% Unsecured convertible note [Member] | ||||
Subsequent Event (Textual) | ||||
Common stock issued | 988,198 | |||
Advance received on entering into securities purchase agreement | $ 50,000 | |||
Amount of debt conversion | $ 6,700 | |||
Convertible promissory note interest, Percentage | 10.00% | |||
Unsecured convertible note aggregate principal amount | $ 500,000 | |||
Unsecured convertible note description | The note is convertible into shares of common stock of the Company at a price equal to a variable conversion price of a) the lesser of $0.13 per share of common stock, b) fifty percent (50%) of the lowest trade price recorded on any trade day after the effective date or c) the lowest effective price per share granted to any person or entity after the effective date to acquire common stock. | On October 13, 2016, the Company and the borrower agreed to amend the convertible promissory note to extend the maturity date to sixty (60) months from the effective date of the note. | ||
Accrued interest | $ 1,667 |