Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2017 | May 10, 2017 | |
Document And Entity Information | ||
Entity Registrant Name | ADVANCED MEDICAL ISOTOPE Corp | |
Entity Central Index Key | 1,449,349 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 44,712,897 | |
Trading Symbol | ADMD | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2,017 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash | $ 23,700 | $ 27,889 |
Prepaid expenses | 11,990 | |
Total current assets | 23,700 | 39,879 |
Fixed assets, net of accumulated depreciation | 733 | 1,473 |
Other assets: | ||
Deposits | 644 | 644 |
Total other assets | 644 | 644 |
Total assets | 25,077 | 41,996 |
Current liabilities: | ||
Accounts payable and accrued expenses | 958,588 | 1,137,086 |
Related party accounts payable | 190,763 | 109,718 |
Accrued interest payable | 91,151 | 114,755 |
Payroll liabilities payable | 442,078 | 499,502 |
Convertible notes payable, net | 1,071,204 | 544,508 |
Derivative liability | 89,464 | 324,532 |
Related party promissory note | 383,771 | 332,195 |
Total current liabilities | 3,227,019 | 3,062,296 |
Total liabilities | 3,227,019 | 3,062,296 |
Mezzanine Equity: | ||
Preferred stock, $.001 par value, 20,000,000 shares authorized Series A preferred stock, $.001 par value, 5,000,000 shares authorized; 2,964,702 and 3,773,592 shares issued and outstanding, respectively | 11,744,233 | 14,144,571 |
Total mezzanine equity | 11,744,233 | 14,144,571 |
Stockholders’ equity (deficit): | ||
Common stock, $.001 par value; 2,000,000,000 shares authorized; 41,967,897 and 31,743,797 shares issued and outstanding, respectively | 41,968 | 31,744 |
Paid in capital | 43,298,063 | 40,672,825 |
Accumulated deficit | (58,286,206) | (57,869,440) |
Total stockholders’ equity (deficit) | (14,946,175) | (17,164,871) |
Total liabilities and stockholders’ equity (deficit) | $ 25,077 | $ 41,996 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2017 | Dec. 31, 2016 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, authorized | 20,000,000 | 20,000,000 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, authorized | 2,000,000,000 | 2,000,000,000 |
Common stock, issued | 41,967,897 | 31,743,797 |
Common stock, outstanding | 41,967,897 | 31,743,797 |
Series A Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, authorized | 5,000,000 | 5,000,000 |
Preferred stock, issued | 2,964,702 | 3,773,592 |
Preferred stock, outstanding | 2,964,702 | 3,773,592 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Income Statement [Abstract] | ||
Revenues | $ 4,054 | $ 4,054 |
Operating expenses | ||
Sales and marketing expenses | 25,998 | 11,836 |
Depreciation and amortization | 740 | 738 |
Professional fees | 134,604 | 70,969 |
Stock options granted | 28,240 | |
Payroll expenses | 104,780 | 165,000 |
General and administrative expenses | 74,407 | 438,042 |
Total operating expenses | 368,769 | 686,585 |
Operating loss | (364,715) | (682,531) |
Non-operating income (expense) | ||
Interest expense | (527,951) | (49,209) |
Net gain on sale of assets | 2,800 | |
Net gain (loss) on settlement of debt | 147,710 | |
Net gain (loss) on debt extinguishment | 147,710 | |
Net gain (loss) on derivative liability | 325,390 | (5,139,998) |
Non-operating income (expense), net | (52,051) | (5,123,370) |
Income (Loss) before Income Taxes | (416,766) | (5,805,901) |
Income Tax Provision | ||
Net Income (Loss) | $ (416,766) | $ (5,805,901) |
Basic and Diluted Income (Loss) per Common Share | $ (0.0110) | $ (0.0029) |
Weighted average common shares outstanding | 38,021,103 | 19,969,341 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flow (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
CASH FLOW FROM OPERATING ACTIVITIES: | ||
Net Loss | $ (416,766) | $ (5,805,901) |
Adjustments to reconcile net loss to net cash used by operating activities: | ||
Depreciation of fixed assets | 740 | 738 |
Amortization of licenses and intangible assets | ||
Amortization of convertible debt discount | 462,928 | 299,773 |
Gain on sale of assets | (2,800) | |
Preferred and common stock issued for loan fees | 300,494 | |
Stock options and warrants issued for services | 28,240 | |
Gain (loss) on derivative liability | (325,390) | 5,139,998 |
Loss on settlement of debt | (147,711) | (65,837) |
Penalties on notes payable | (332,274) | |
Changes in operating assets and liabilities: | ||
Prepaid expenses | 11,990 | 5,411 |
Accounts payable | 109,110 | (170,241) |
Payroll liabilities | (57,424) | 73,274 |
Accrued interest | 61,425 | (18,290) |
Net cash used by operating activities | (275,658) | (572,855) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Sale of fixed assets | 2,800 | |
Net cash from investing activities | 2,800 | |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from shareholder advances | 137,000 | |
Proceeds from convertible debt | 131,669 | 641,760 |
Net cash provided by financing activities | 268,669 | 641,760 |
Net increase in cash | (4,189) | 68,905 |
Cash, beginning of period | 27,889 | 179,032 |
CASH, END OF PERIOD | 23,700 | 247,937 |
Supplemental disclosures of cash flow information: | ||
Cash paid for interest | 9,920 | |
Cash paid for income taxes |
Basis of Presentation and Signi
Basis of Presentation and Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Significant Accounting Policies | NOTE 1: BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES The accompanying condensed consolidated financial statements of the Company have been prepared without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and disclosures required by accounting principles generally accepted in the United States have been condensed or omitted pursuant to such rules and regulations. These condensed consolidated financial statements reflect all adjustments that, in the opinion of management, are necessary to present fairly the results of operations of the Company for the period presented. The results of operations for the three months ended March 31, 2017, are not necessarily indicative of the results that may be expected for any future period or the fiscal year ending December 31, 2017 and should be read in conjunction with the Company’s form 10-K for the year ended December 31, 2016. Use of Estimates The preparation of financial statements in accordance with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. 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 March 31, 2017 and December 31, 2016, the balances reported for cash, prepaid expenses, accounts receivable, 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. The Company measures certain financial instruments at fair value on a recurring basis. Assets and liabilities measured at fair value on a recurring basis were calculated using the Black-Scholes pricing model and are as follows at March 31, 2017 and December 31, 2016: March 31, 2017 Total Level 1 Level 2 Level 3 Liabilities: Derivative Liability $ 89,464 $ $ $ 89,464 Total Liabilities Measured at Fair Value $ 89,464 $ - $ - $ 89,464 December 31, 2016 Total Level 1 Level 2 Level 3 Liabilities: Derivative Liability $ 324,532 $ $ $ 324,532 Total Liabilities Measured at Fair Value $ 324,532 $ - $ - $ 324,532 Recent Accounting Pronouncements There are no recently issued accounting pronouncements that the Company believes are applicable or would have a material impact on the financial statements of the Company. |
Going Concern
Going Concern | 3 Months Ended |
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Going Concern | NOTE 2: GOING CONCERN The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. As shown in the accompanying financial statements, the Company has suffered recurring losses and used significant cash in support of its operating activities and the Company’s cash position is not sufficient to support the Company’s operations. Historically, the Company has relied upon outside investor funds to maintain the Company’s operations and develop the Company’s business. The Company anticipates it will continue to require funding from investors for working capital as well as business expansion during this fiscal year and it can provide no assurance that additional investor funds will be available on terms acceptable to us. These factors, among others, may indicate that the Company will be unable to continue as a going concern for a reasonable time. In addition, the Company’s ability to continue as a going concern must be considered in light of the problems, expenses and complications frequently encountered by entrance into established markets and the competitive environment in which it operates. The Company anticipates a requirement of $1.5 million in funds over the next twelve months to maintain current operation activities. The Company may also require up to approximately $1.5 million to retire outstanding debt and past due payables. As of March 31, 2017 the Company has certain convertible promissory notes totaling approximately $45,000 that are currently due and payable (“ Outstanding Notes The Company requires funding of at least $1.5 million per year to maintain current operating activities. Over the next 12-24 months, the Company believes it will cost approximately $5 million to $10 million to fund: (1) the FDA approval process and initial deployment of the brachytherapy products and (2) initiate regulatory approval processes outside of the United States. The continued deployment of the brachytherapy products and a worldwide regulatory approval effort will require additional resources and personnel. The principal variables in the timing and amount of spending for the brachytherapy products in the next 12-24 months will be the FDA’s classification of the Company’s brachytherapy products as Class II or Class III devices (or otherwise) and any requirements for additional studies which may possibly include clinical studies. Thereafter, the principal variables in the amount of the Company’s spending and its financing requirements would be the timing of any approvals and the nature of the Company’s arrangements with third parties for manufacturing, sales, distribution and licensing of those products and the products’ success in the U.S. and elsewhere. The Company intends to fund its activities through strategic transactions such as licensing and partnership agreements or additional capital raises. As of March 31, 2017, the Company has $23,700 cash on hand. There are currently commitments to vendors for products and services purchased, accrued compensation expenses and the Company’s current lease commitments that in the absence of additional capital would result in a liquidation of the Company. The current level of cash is not enough to cover the fixed and variable obligations of the Company. Assuming the Company is successful in the Company’s sales/development effort it believes that it will be able to raise additional funds through strategic agreements or the sale of the Company’s stock to either current or new stockholders. There is no guarantee that the Company will be able to raise additional funds or to do so at an advantageous price. The financial statements do not include any adjustments relating to the recoverability and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The Company’s continuation as a going concern is dependent upon its ability to generate sufficient cash flow to meet its obligations on a timely basis and ultimately to attain profitability. The Company plans to seek additional funding to maintain its operations through debt and equity financing and to improve operating performance through a focus on strategic products and increased efficiencies in business processes and improvements to the cost structure. There is no assurance that the Company will be successful in its efforts to raise additional working capital or achieve profitable operations. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. |
Fixed Assets
Fixed Assets | 3 Months Ended |
Mar. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Fixed Assets | NOTE 3: FIXED ASSETS Fixed assets consist of the following at March 31, 2017 and December 31, 2016: March 31, 2017 December 31, 2016 Production equipment $ 15,182 $ 1,938,532 Office equipment 14,593 32,769 29,775 1,971,301 Less accumulated depreciation (29,042 ) (1,969,828 ) $ 733 $ 1,473 Depreciation expense for the above fixed assets for the three months ended March 31, 2017 and 2016, respectively, was $740 and $738. |
Intangible Assets
Intangible Assets | 3 Months Ended |
Mar. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | NOTE 4: INTANGIBLE ASSETS Intangible assets consist of the following at March 31, 2017 and December 31, 2016: March 31, 2017 December 31, 2016 License Fee $ - $ 112,500 Less accumulated amortization - (112,500 ) Patents and intellectual property - - Intangible assets net of accumulated amortization $ - $ - Amortization expense for the above intangible assets for the three months ended March 31, 2017 and 2016, respectively, was $0 and $0. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 5: RELATED PARTY TRANSACTIONS Related Party Convertible Notes Payable The Company, in March 2017, combined the o n Rent Expenses The Company rents office space from a significant shareholder and director of the Company on a month to month basis with a monthly payment of $1,500. Rental expense for the three months ended March 31, 2017 and 2016 consisted of the following and is recorded in general and administrative expense: Three months ended March 31, 2017 Three months ended March 31, 2016 Office and warehouse space $ - $ - Corporate office 4,500 4,500 Total Rental Expense $ 4,500 $ 4,500 |
Convertible Notes Payable
Convertible Notes Payable | 3 Months Ended |
Mar. 31, 2017 | |
Convertible Notes Payable | |
Convertible Notes Payable | NOTE 6: CONVERTIBLE NOTES PAYABLE As of March 31, 2017 and December 31, 2016 the Company had the following convertible notes outstanding: March 31, 2017 December 31, 2016 Principal (net) Accrued Interest Principal (net) Accrued Interest July and August 2012 $1,060,000 Notes convertible into common stock at $4.60 per share, 12% interest, due December 2013 and January 2014 $ 45,000 $ 25,161 $ 95,000 50,365 May through October 2015 $605,000 Notes convertible into preferred stock at $1 per share, 8-10% interest, due September 30, 2015 - 17,341 - 17,341 October through December 2015 $613,000 Notes convertible into preferred stock at $1 per share, 8% interest, due June 30, 2016, net of debt discount of $0 and $560,913, respectively - 5,953 - 5,953 January through March 2016 $345,000 Notes convertible into preferred stock at $1 per share, 8% interest, due June 30, 2016 - 696 - 696 November 2016 $979,162 Notes convertible into common stock at a variable conversion price, 10% interest, due May 2017, net of debt discounts of $156,788 and $540,720, respectively 822,374 36,547 438,442 12,397 January and March 2017 $335,838 Notes convertible into common stock at a variable conversion price, 10% interest, due May 2017, net of debt discounts of $142,918 and $0, respectively 192,920 4,090 - - Penalties on notes in default 10,910 - 11,066 - Total Convertible Notes Payable, Net $ 1,071,204 $ 89,788 $ 544,508 $ 86,752 During the three months ending March 31, 2017, the Company received proceeds from new convertible notes of $131,669 and obtained advances from shareholders of $137,000 that were reclassified into convertible notes payable. The Company recorded original issue discounts on new convertible notes of $67,169, which also increased the debt discounts recorded on the convertible notes. The Company recorded $50,000 of payments on their convertible notes and a total gain on settlement of $5,831 representing the write-off of convertible note principal. Each of the Company’s convertible notes have a conversion rate that is variable. The Company therefore has accounted for such conversion features as derivative instruments (see Note 9). As a result of recording derivative liabilities at note inception, the Company increased the debt discount recorded on their convertible notes by $90,322 during the three months ending March 31, 2017. The Company also recorded amortization of $462,928 on their convertible note debt discounts. Lastly, the Company issued 49,320 shares of the Company’s Series A Convertible Preferred Stock (“ Series A Preferred |
Common Stock Options And Warran
Common Stock Options And Warrants | 3 Months Ended |
Mar. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Common Stock Options And Warrants | NOTE 7: COMMON STOCK OPTIONS AND WARRANTS Common Stock Options The Company recognizes in the financial statements compensation related to all stock-based awards, including stock options and warrants, based on their estimated grant-date fair value. The Company has estimated expected forfeitures and is recognizing compensation expense only for those awards expected to vest. All compensation is recognized by the time the award vests. The following schedule summarizes the changes in the Company’s stock options: Weighted Weighted Options Outstanding Average Average Number Exercise Remaining Aggregate Exercise Of Price Contractual Intrinsic Price Shares Per Share Life Value Per Share Balance at December 31, 2016 2,402,500 $ 0.50-15 4.05 years $ - $ 0.81 Options granted - $ - - $ - Options exercised - $ - - $ - Options expired - $ - - $ - Balance at March 31, 2017 2,402,500 $ 0.50-15 3.81 years $ - $ 0.81 Exercisable at March 31, 2017 2,016,733 $ 0.50-15 3.73 years $ - $ 0.86 During the three months ended March 31, 2017 the Company recognized $28,240 worth of stock based compensation related to the vesting of its stock options. Common Stock Warrants The following schedule summarizes the changes in the Company’s stock warrants: Weighted Weighted Warrants Outstanding Average Average Number Exercise Remaining Aggregate Exercise Of Price Contractual Intrinsic Price Shares Per Share Life Value Per Share Balance at December 31, 2016 3,579,505 $ 0.10-10 0.52 years $ 749 $ 4.45 Warrants granted - $ - - $ Warrants exercised - $ - - $ Warrants expired/cancelled (15,000 ) $ - - $ 2.07 Balance at March 31, 2017 3,564,505 $ 0.40-10 0.28 years $ - $ 4.46 Exercisable at March 31, 2017 3,564,505 $ 0.40-10 0.28 years $ - $ 4.46 |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2017 | |
Equity [Abstract] | |
Stockholders' Equity | NOTE 8: STOCKHOLDERS’ EQUITY Common Stock During the three months ending March 31, 2017 the Company issued 762,000 shares of its common stock valued at $99,060 for the settlement of debt, 280,000 shares of its common stock valued at $43,400 for accounts payable, and 9,182,100 shares of its common stock valued at $2,464,762 for conversions of 858,210 shares of Series A Preferred. Preferred Stock During the three months ending March 31, 2017 the Company issued 49,320 shares of Series A Preferred valued at $64,424 as loan fees on convertible promissory notes. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 3 Months Ended |
Mar. 31, 2017 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Information | NOTE 9: SUPPLEMENTAL CASH FLOW INFORMATION During the three months ending March 31, 2017 the Company had the following non-cash investing and financing activities: ● Increased convertible notes payable by $5,675, increased related party notes payable by $51,576, and decreased accrued interest by $57,251 for the reclassification of accrued interest to principal. ● Increased derivative liabilities for $90,322 to record a debt discount on convertible notes payable. ● Increased convertible notes payable and decreased loan from shareholder by $137,000 to roll proceeds from shareholder advances to a formal convertible note payable. ● Issued 49,320 shares of Series A preferred stock for loan fees that increased the convertible note debt discount by $64,424. ● Issued 9,182,100 shares of common stock in exchange for 858,210 shares of Series A Preferred decreasing preferred stock by $2,464,762, increasing common stock by $9,182, and increasing paid in capital by $2,455,580. ● Issued 280,000 shares of common stock valued at $43,400 for the reduction of $140,000 of accounts payable, recording $96,600 as a gain on extinguishment of debt. ● Issued 762,000 shares of common stock valued at $99,060 for the reduction of $50,000 of convertible notes payable and $27,778 of accrued interest, recording $21,282 as a gain on extinguishment of debt. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 10: SUBSEQUENT EVENTS In April 2017 the Company received $43,750 in exchange for 10% convertible promissory notes due October 13, 2017. The Company issued 12,600 Series A Preferred as a loan fee on this note. In April 2017 the Company settled $86,767 of accounts payable in exchange for 825,000 of common stock. In April of 2017, the Company filed a Certificate of Merger with the Delaware Division of Corporations in order to merge the Company’s wholly-owned subsidiary, IsoPet Solutions Corporation, with and into the Company. On May 15, 2017 the Company completed the issuance of $2,194,443 7.5% Senior Secured Convertible Debentures (the "Debentures"), consisting of a principal amount of $1,755,554 and $438,889 of original issue discounts, and a maturity date of May 15, 2018. These Debentures were issued in exchange for 10% Convertible promissory notes with an aggregate prepayment amount of $1,755,554 that were maturing on various dates in May 2017 through October 2017. Of these Debentures $820,419 have a $0.12 conversion rate, $210,313 have a $0.13 conversion rate, and $1,163,711 have a $0.20 conversion rate. In conjunction with the transaction the Company issued 445,861 Series A Preferred as loan fees. On May 15, 2017 the Company issued Debentures in the aggregate principal amount of $1,179,581, with $235,916 in original issue discounts, in resulting in gross proceeds of $943,664.39 to the Company. Each of these Debentures have a conversion rate of $0.20. The Company issued 235,917 of Series A Preferred as loan fees on these Debentures. In connection with this financing the Company paid commissions of $75,493 to Chardan. In April and May, 2017, the Company issued 1,920,000 shares of common stock for 192,000 shares of Series A Preferred. |
Basis of Presentation and Sig16
Basis of Presentation and Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates The preparation of financial statements in accordance with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
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 March 31, 2017 and December 31, 2016, the balances reported for cash, prepaid expenses, accounts receivable, 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. The Company measures certain financial instruments at fair value on a recurring basis. Assets and liabilities measured at fair value on a recurring basis were calculated using the Black-Scholes pricing model and are as follows at March 31, 2017 and December 31, 2016: March 31, 2017 Total Level 1 Level 2 Level 3 Liabilities: Derivative Liability $ 89,464 $ $ $ 89,464 Total Liabilities Measured at Fair Value $ 89,464 $ - $ - $ 89,464 December 31, 2016 Total Level 1 Level 2 Level 3 Liabilities: Derivative Liability $ 324,532 $ $ $ 324,532 Total Liabilities Measured at Fair Value $ 324,532 $ - $ - $ 324,532 |
Recent Accounting Pronouncements | Recent Accounting Pronouncements There are no recently issued accounting pronouncements that the Company believes are applicable or would have a material impact on the financial statements of the Company. |
Basis of Presentation and Sig17
Basis of Presentation and Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Basis Of Presentation And Significant Accounting Policies Tables | |
Schedule of Fair Value of Financial Instruments | The Company measures certain financial instruments at fair value on a recurring basis. Assets and liabilities measured at fair value on a recurring basis were calculated using the Black-Scholes pricing model and are as follows at March 31, 2017 and December 31, 2016: March 31, 2017 Total Level 1 Level 2 Level 3 Liabilities: Derivative Liability $ 89,464 $ $ $ 89,464 Total Liabilities Measured at Fair Value $ 89,464 $ - $ - $ 89,464 December 31, 2016 Total Level 1 Level 2 Level 3 Liabilities: Derivative Liability $ 324,532 $ $ $ 324,532 Total Liabilities Measured at Fair Value $ 324,532 $ - $ - $ 324,532 |
Fixed Assets (Tables)
Fixed Assets (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Fixed Assets | Fixed assets consist of the following at March 31, 2017 and December 31, 2016: March 31, 2017 December 31, 2016 Production equipment $ 15,182 $ 1,938,532 Office equipment 14,593 32,769 29,775 1,971,301 Less accumulated depreciation (29,042 ) (1,969,828 ) $ 733 $ 1,473 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets | Intangible assets consist of the following at March 31, 2017 and December 31, 2016: March 31, 2017 December 31, 2016 License Fee $ - $ 112,500 Less accumulated amortization - (112,500 ) Patents and intellectual property - - Intangible assets net of accumulated amortization $ - $ - |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transaction | Rental expense for the three months ended March 31, 2017 and 2016 consisted of the following and is recorded in general and administrative expense: Three months ended March 31, 2017 Three months ended March 31, 2016 Office and warehouse space $ - $ - Corporate office 4,500 4,500 Total Rental Expense $ 4,500 $ 4,500 |
Convertible Notes Payable (Tabl
Convertible Notes Payable (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Convertible Notes Payable Tables | |
Schedule of Convertible Notes Payable | As of March 31, 2017 and December 31, 2016 the Company had the following convertible notes outstanding: March 31, 2017 December 31, 2016 Principal (net) Accrued Interest Principal (net) Accrued Interest July and August 2012 $1,060,000 Notes convertible into common stock at $4.60 per share, 12% interest, due December 2013 and January 2014 $ 45,000 $ 25,161 $ 95,000 50,365 May through October 2015 $605,000 Notes convertible into preferred stock at $1 per share, 8-10% interest, due September 30, 2015 - 17,341 - 17,341 October through December 2015 $613,000 Notes convertible into preferred stock at $1 per share, 8% interest, due June 30, 2016, net of debt discount of $0 and $560,913, respectively - 5,953 - 5,953 January through March 2016 $345,000 Notes convertible into preferred stock at $1 per share, 8% interest, due June 30, 2016 - 696 - 696 November 2016 $979,162 Notes convertible into common stock at a variable conversion price, 10% interest, due May 2017, net of debt discounts of $156,788 and $540,720, respectively 822,374 36,547 438,442 12,397 January and March 2017 $335,838 Notes convertible into common stock at a variable conversion price, 10% interest, due May 2017, net of debt discounts of $142,918 and $0, respectively 192,920 4,090 - - Penalties on notes in default 10,910 - 11,066 - Total Convertible Notes Payable, Net $ 1,071,204 $ 89,788 $ 544,508 $ 86,752 |
Common Stock Options and Warr22
Common Stock Options and Warrants (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Equity [Abstract] | |
Schedule Summarizes Changes in Stock Option | The following schedule summarizes the changes in the Company’s stock options: Weighted Weighted Options Outstanding Average Average Number Exercise Remaining Aggregate Exercise Of Price Contractual Intrinsic Price Shares Per Share Life Value Per Share Balance at December 31, 2016 2,402,500 $ 0.50-15 4.05 years $ - $ 0.81 Options granted - $ - - $ - Options exercised - $ - - $ - Options expired - $ - - $ - Balance at March 31, 2017 2,402,500 $ 0.50-15 3.81 years $ - $ 0.81 Exercisable at March 31, 2017 2,016,733 $ 0.50-15 3.73 years $ - $ 0.86 |
Schedule Summarizes Changes in Stock Warrants | The following schedule summarizes the changes in the Company’s stock warrants: Weighted Weighted Warrants Outstanding Average Average Number Exercise Remaining Aggregate Exercise Of Price Contractual Intrinsic Price Shares Per Share Life Value Per Share Balance at December 31, 2016 3,579,505 $ 0.10-10 0.52 years $ 749 $ 4.45 Warrants granted - $ - - $ Warrants exercised - $ - - $ Warrants expired/cancelled (15,000 ) $ - - $ 2.07 Balance at March 31, 2017 3,564,505 $ 0.40-10 0.28 years $ - $ 4.46 Exercisable at March 31, 2017 3,564,505 $ 0.40-10 0.28 years $ - $ 4.46 |
Basis of Presentation and Sig23
Basis of Presentation and Significant Accounting Policies - Schedule of Fair Value of Financial Instruments (Details) - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Derivative Liability | $ 89,464 | $ 324,532 |
Total Liabilities Measured at Fair Value | 89,464 | 324,532 |
Level 1 [Member] | ||
Derivative Liability | ||
Total Liabilities Measured at Fair Value | ||
Level 2 [Member] | ||
Derivative Liability | ||
Total Liabilities Measured at Fair Value | ||
Level 3 [Member] | ||
Derivative Liability | 89,464 | 324,532 |
Total Liabilities Measured at Fair Value | $ 89,464 | $ 324,532 |
Going Concern (Details Narrativ
Going Concern (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Dec. 31, 2016 | |
Current operation activities | $ 1,500,000 | |
Retire outstanding debt | 1,500,000 | |
Convertible promissory notes | 45,000 | |
Cash on hand | 23,700 | $ 27,889 |
Minimum [Member] | ||
Capital | 5,000,000 | |
Maximum [Member] | ||
Capital | $ 10,000,000 |
Fixed Assets (Details Narrative
Fixed Assets (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expense | $ 740 | $ 738 |
Fixed Assets - Schedule of Fixe
Fixed Assets - Schedule of Fixed Assets (Details) - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Total Fixed assets | $ 29,775 | $ 1,971,301 |
Less accumulated depreciation | (29,042) | (1,969,828) |
Net Fixed assets | 733 | 1,473 |
Production Equipment [Member] | ||
Total Fixed assets | 15,182 | 1,938,532 |
Office Equipment [Member] | ||
Total Fixed assets | $ 14,593 | $ 32,769 |
Intangible Assets (Details Narr
Intangible Assets (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Intangible Assets Details Narrative | ||
Amortization expense of intangible assets |
Intangible Assets - Schedule o
Intangible Assets - Schedule of Intangible Assets (Details) - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
License Fee | $ 112,500 | |
Less accumulated amortization | (112,500) | |
Patents and intellectual property | ||
Intangible assets net of accumulated amortization |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Dec. 31, 2016 | |
Accrued interest payable | $ 89,788 | $ 86,752 |
Related party promissory note | 383,771 | $ 332,195 |
Payment of rent | 1,500 | |
Director [Member] | ||
Accrued interest payable | $ 51,576 |
Related Party Transaction - Sch
Related Party Transaction - Schedule of Related Party Transaction (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Related Party Transactions [Abstract] | ||
Office and warehouse space | ||
Corporate office | 4,500 | 4,500 |
Total Rental Expense | $ 4,500 | $ 4,500 |
Convertible Notes Payable (Deta
Convertible Notes Payable (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Proceeds from convertible note payable | $ 131,669 | $ 641,760 |
Gain on settlement of debt | 147,710 | |
Amortization of debt | $ 462,928 | $ 299,773 |
Number of shares issued | 280,000 | |
Series A Preferred Stock [Member] | ||
Number of shares issued | 9,182,100 | |
Convertible Notes Payable [Member] | ||
Proceeds from convertible note payable | $ 131,669 | |
Advances from shareholders | 137,000 | |
Debt original issue discounts | 67,169 | |
Payment of convertible note payable | 50,000 | |
Gain on settlement of debt | 5,831 | |
Increase in debt discount | 90,322 | |
Amortization of debt | 462,928 | |
Convertible Notes Payable [Member] | Series A Preferred Stock [Member] | ||
Increase in debt discount | $ 64,424 | |
Number of shares issued | 49,320 |
Convertible Notes Payable - Sch
Convertible Notes Payable - Schedule of Convertible Notes Payable (Details) - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Principal (net) | $ 1,071,204 | $ 544,508 |
Accrued Interest | 89,788 | 86,752 |
Penalties on notes past due principal (net) | 10,910 | 11,066 |
Penalties on notes in default accrued interest | ||
Convertible Notes Payable One [Member] | ||
Principal (net) | 45,000 | 95,000 |
Accrued Interest | 25,161 | 50,365 |
Convertible Notes Payable Two [Member] | ||
Principal (net) | ||
Accrued Interest | 17,341 | 17,341 |
Convertible Notes Payable Three [Member] | ||
Principal (net) | ||
Accrued Interest | 5,953 | 5,953 |
Convertible Notes Payable Four [Member] | ||
Principal (net) | ||
Accrued Interest | 696 | 696 |
Convertible Notes Payable Five [Member] | ||
Principal (net) | 822,374 | 438,442 |
Accrued Interest | 36,547 | 12,397 |
Convertible Notes Payable Six [Member] | ||
Principal (net) | 192,920 | |
Accrued Interest | $ 4,090 |
Convertible Notes Payable - S33
Convertible Notes Payable - Schedule of Convertible Notes Payable (Details) (Parenthetical) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Dec. 31, 2016 | |
Convertible Notes Payable One [Member] | ||
Debt principal amount | $ 1,060,000 | |
Debt conversion price per share | $ 4.60 | |
Debt interest rate | 12.00% | |
Debt maturity date description | December 2013 and January 2014 | |
Convertible Notes Payable Two [Member] | ||
Debt principal amount | $ 605,000 | |
Debt conversion price per share | $ 1 | |
Debt maturity date description | September 30, 2015 | |
Convertible Notes Payable Two [Member] | Minimum [Member] | ||
Debt interest rate | 8.00% | |
Convertible Notes Payable Two [Member] | Maximum [Member] | ||
Debt interest rate | 10.00% | |
Convertible Notes Payable Three [Member] | ||
Debt principal amount | $ 613,000 | |
Debt conversion price per share | $ 1 | |
Debt interest rate | 8.00% | |
Debt maturity date description | June 30, 2016 | |
Debt discount | $ 0 | $ 560,913 |
Convertible Notes Payable Four [Member] | ||
Debt principal amount | $ 345,000 | |
Debt conversion price per share | $ 1 | |
Debt interest rate | 8.00% | |
Debt maturity date description | June 30, 2016 | |
Convertible Notes Payable Five [Member] | ||
Debt principal amount | $ 979,162 | |
Debt conversion price per share | ||
Debt interest rate | 10.00% | |
Debt maturity date description | May 2,017 | |
Debt discount | $ 156,788 | 540,720 |
Convertible Notes Payable Six [Member] | ||
Debt principal amount | $ 335,838 | |
Debt interest rate | 10.00% | |
Debt maturity date description | May 2,017 | |
Debt discount | $ 142,918 | $ 0 |
Common Stock Options and Warr34
Common Stock Options and Warrants - Schedule Summarizes Changes in Stock Option (Details) - Stock Options | 3 Months Ended |
Mar. 31, 2017USD ($)$ / sharesshares | |
Number Of Shares Options Outstanding Beginning Balance | shares | 2,402,500 |
Number of Options Granted | shares | |
Number of Options Exercised | shares | |
Number of Options Expired | shares | |
Number Of Shares Options Outstanding Ending Balance | shares | 2,402,500 |
Number Of Shares Options Exercisable Ending Balance | shares | 2,016,733 |
Weighted Average Exercise Price Granted | |
Weighted Average Exercise Price Exercised | |
Weighted Average Exercise Price Expired | |
Weighted Average Remaining Contractual Life (in years) Outstanding, Beginning | 4 years 18 days |
Weighted Average Remaining Contractual Life (in years) Outstanding, Ending | 3 years 9 months 22 days |
Weighted Average Remaining Contractual Life (in years) Exercisable | 3 years 8 months 23 days |
Aggregate Intrinsic Value Outstanding | $ | |
Aggregate Intrinsic Value Exercisable | $ | |
Weighted Average Exercise Price Per Share Outstanding Beginning | $ 0.81 |
Weighted Average Exercise Price Per Share Options Granted | |
Weighted Average Exercise Price Per Share Options Exercised | |
Weighted Average Exercise Price Per Share Options Expired | |
Weighted Average Exercise Price Per Share Outstanding Ending | 0.81 |
Weighted Average Exercise Price Per Share Exercisable | 0.86 |
Minimum [Member] | |
Weighted Average Exercise Price Outstanding | 0.50 |
Weighted Average Exercise Price Granted | |
Weighted Average Exercise Price Outstanding | 0.50 |
Exercise Price Per Share Exercisable | 0.50 |
Maximum [Member] | |
Weighted Average Exercise Price Outstanding | 15 |
Weighted Average Exercise Price Granted | |
Weighted Average Exercise Price Outstanding | 15 |
Exercise Price Per Share Exercisable | $ 15 |
Common Stock Options and Warr35
Common Stock Options and Warrants - Schedule Summarizes Changes in Stock Warrants (Details) - Warrants [Member] | 3 Months Ended |
Mar. 31, 2017USD ($)$ / sharesshares | |
Number of Shares, Warrants Outstanding Beginning | shares | 3,579,505 |
Number of Shares, Warrants Granted | shares | |
Number of Shares, Warrants Exercised | shares | |
Number of Shares, Warrants expired/cancelled | shares | (15,000) |
Number of Shares, Warrants Outstanding Ending | shares | 3,564,505 |
Number of Shares, Warrants Exercisable Ending | shares | 3,564,505 |
Exercise Price Per Share Warrants Granted | |
Exercise Price Per Share Warrants Exercised | |
Exercise Price Per Share Warrants Expired/cancelled | |
Weighted Average Remaining Contractual Life (in years) Warrants Outstanding, Beginning | 6 months 7 days |
Weighted Average Remaining Contractual Life (in years) Warrants Outstanding Ending | 3 months 11 days |
Weighted Average Remaining Contractual Life (in years) Warrants Exercisable | 3 months 11 days |
Aggregate Intrinsic Value Outstanding | $ | $ 749 |
Aggregate Intrinsic Value Outstanding | $ | |
Aggregate Intrinsic Value Exercisable | $ | |
Weighted Average Exercise Price Per Share Exercise Price Warrants Beginning | $ 4.45 |
Weighted Average Exercise Price Per Share Exercise Price Warrants Granted | |
Weighted Average Exercise Price Per Share Exercise Price Warrants Exercised | |
Weighted Average Exercise Price Per Share Exercise Price Warrants Expired/cancelled | 2.07 |
Weighted Average Exercise Price Per Share Exercise Price Warrants Ending | 4.46 |
Weighted Average Exercise Price Per Share Exercise Price Warrants Exercisable | 4.46 |
Minimum [Member] | |
Weighted Average Exercise Price Outstanding | 0.10 |
Weighted Average Exercise Price Outstanding | 0.10 |
Exercise Price Per Share Exercisable | 0.10 |
Maximum [Member] | |
Weighted Average Exercise Price Outstanding | 10 |
Weighted Average Exercise Price Outstanding | 10 |
Exercise Price Per Share Exercisable | $ 10 |
Stockholders' Equity (Details N
Stockholders' Equity (Details Narrative) | 3 Months Ended |
Mar. 31, 2017USD ($)shares | |
Number of shares issued | 280,000 |
Number of shares issued, value | $ | $ 43,400 |
Series A Preferred Stock [Member] | |
Number of shares issued | 9,182,100 |
Number of shares issued, value | $ | $ 2,464,762 |
Common stock issued for debt conversions, shares | 858,210 |
Settlement of Debt [Member] | |
Number of shares issued | 762,000 |
Number of shares issued, value | $ | $ 99,060 |
Accounts Payable [Member] | |
Number of shares issued | 280,000 |
Number of shares issued, value | $ | $ 43,400 |
Convertible Promissory Note [Member] | Series A Preferred Stock [Member] | |
Number of shares issued | 49,320 |
Number of shares issued, value | $ | $ 64,424 |
Supplemental Cash Flow Inform37
Supplemental Cash Flow Information (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Dec. 31, 2016 | |
Increase in convertible note payable | $ 5,675 | |
Increase in related party debt | 51,576 | |
Decrease in accrued interest | 57,251 | |
Increase in derivative liabilities | 90,322 | |
Increased convertible notes payable and decreased loan from shareholder | $ 137,000 | |
Number of preferred stock shares issued for loan fees on convertible promissory notes | 49,320 | |
Number of preferred stock issued for loan fees on convertible promissory notes | $ 64,424 | |
Number of shares issued | 280,000 | |
Number of shares issued, value | $ 43,400 | |
Gain on extinguishment of debt | 96,600 | |
Accrued interest | $ 91,151 | $ 114,755 |
Series A Preferred Stock [Member] | ||
Number of shares issued | 9,182,100 | |
Issued shares of common stock in exchange for preferred stock | 858,210 | |
Decrease in preferred stock | $ 2,464,762 | |
Increase in common stock | 9,182 | |
Increase in additional paid in capital | 2,455,580 | |
Number of shares issued, value | $ 2,464,762 | |
Common Stock [Member] | ||
Number of shares issued | 762,000 | |
Number of shares issued, value | $ 99,060 | |
Gain on extinguishment of debt | 21,282 | |
Reduction amount | 50,000 | |
Accrued interest | $ 27,778 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - USD ($) | May 31, 2017 | May 15, 2017 | Apr. 30, 2017 | Mar. 31, 2017 | Mar. 31, 2016 |
Number of shares issued | 280,000 | ||||
Proceeds from debt | $ 131,669 | $ 641,760 | |||
Series A Preferred Stock [Member] | |||||
Number of shares issued | 9,182,100 | ||||
Common Stock [Member] | |||||
Number of shares issued | 762,000 | ||||
Subsequent Event [Member] | |||||
Debt principal amount | $ 43,750 | ||||
Debt interest rate | 10.00% | ||||
Debt maturity date | Oct. 13, 2017 | ||||
Number of shares issued | 825,000 | ||||
Accounts payable | $ 86,767 | ||||
Subsequent Event [Member] | Chardan Capital Markets [Member] | |||||
Commission paid | $ 75,493 | ||||
Subsequent Event [Member] | 7.5% Senior Secured Convertible Debentures [Member] | |||||
Debt principal amount | $ 1,755,554 | ||||
Debt interest rate | 10.00% | ||||
Debt maturity date | May 15, 2018 | ||||
Debt maturity date description | May 2017 through October 2017 | ||||
Proceeds from debt | $ 2,194,443 | ||||
Repayments of debt | 1,755,554 | ||||
Subsequent Event [Member] | 7.5% Senior Secured Convertible Debentures One [Member] | |||||
Debt principal amount | 1,179,581 | ||||
Debt discount | 235,916 | ||||
Proceeds from debt | $ 820,419 | ||||
Debt instrument, conversion price rate | $ 0.12 | ||||
Subsequent Event [Member] | 7.5% Senior Secured Convertible Debentures Two [Member] | |||||
Proceeds from debt | $ 210,313 | ||||
Debt instrument, conversion price rate | $ 0.13 | ||||
Subsequent Event [Member] | 7.5% Senior Secured Convertible Debentures Three [Member] | |||||
Proceeds from debt | $ 1,163,711 | ||||
Debt instrument, conversion price rate | $ 0.20 | ||||
Subsequent Event [Member] | Series A Preferred Stock [Member] | |||||
Number of shares issued | 192,000 | 235,916 | 12,600 | ||
Debt discount | $ 1,179,581 | ||||
Proceeds from debt | $ 943,664 | ||||
Debt instrument, conversion price rate | $ 0.20 | ||||
Subsequent Event [Member] | Series A Preferred Stock [Member] | 7.5% Senior Secured Convertible Debentures [Member] | |||||
Number of shares issued | 445,861 | ||||
Subsequent Event [Member] | Common Stock [Member] | |||||
Number of shares issued | 1,920,000 |