8. STOCKHOLDERS' EQUITY | 6 Months Ended |
Jun. 30, 2014 |
Notes to Financial Statements | ' |
NOTE 8 - STOCKHOLDERS' EQUITY | ' |
Preferred Stock |
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The Company authorized 50,000,000 shares of preferred stock with a par value of $0.0001. On November 7, 2012, the Company’s Board of Directors approved the filing of a Certificate of Designation of the Preferences and Rights of Series A Preferred Stock of Green Innovations Ltd. (“Certificate of Designation”) with the Secretary of State of the State of Nevada authorizing the creation of a new series of preferred stock designated as “Series A Preferred Stock” pursuant to the authority granted to the Board of Directors under the Company’s Amended and Restated Certificate of Incorporation and Section NRS 78.1955 of the Nevada General Corporation Law. The Certificate of Designation was filed with the Nevada Department of State on November 7, 2012. The Certificate of Designation created 5,000,000 shares of Series A Preferred Stock. Each holder of Series A Preferred Stock will be entitled to participate in dividends or distributions payable to holders of the Company’s common stock at a rate of the dividend payable to each share of Common Stock multiplied by the number of shares of Common Stock that each share of such holder’s Series A Preferred Stock is convertible into. Each share of Series A Preferred Stock is convertible, at the option of the holder of the Series A Preferred Stock, into one share of the Company’s common stock. Shares of the Series A Preferred Stock will be issued to certain officers of the Company as the Board determines for consideration of the exchange for shares of common stock of the Company. Each share of Series A Preferred Stock will be entitled to ten (10) votes on all matters submitted to a vote of the stockholders of the Company (“Enhanced Voting Rights”). Upon the liquidation, dissolution or winding up of the Company, the holders of the Series A Preferred Stock will participate in the distribution of the Company’s assets with the holders of the Company’s Common Stock pro rata based on the number of shares of Common Stock held by each (assuming conversion of all shares of Series A Preferred Stock). Due to the Enhanced Voting Rights, following the issuance of shares of Series A Preferred Stock, the holders of the Series A Preferred Stock may be able to exercise voting control over the Company. In such case, the holders of the Series A Preferred Stock may gain the ability to control the outcome of corporate actions requiring stockholder approval, including mergers and other changes of corporate control, going private transactions, and other extraordinary transactions. The concentration of voting control in the Series A Preferred Stock could discourage investments in the Company, or prevent a potential takeover of the Company which may have a negative impact on the value of the Company’s securities. In addition, the liquidation rights granted to the holders of the Series A Preferred Stock will have a dilutive effect on the distributions available to the holders of the Company’s common stock. As of June 30, 2014, there were 5,000,000 shares of Series A Preferred Stock issued or outstanding. |
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On February 7, 2013, the Company and Harmon executed a Share Cancellation / Exchange / Return to Treasury Agreement. Harmon returned to the Company 45,000,000 shares of common stock in exchange for 5,000,000 shares of Series A preferred stock (see Note 6). The preferred shares were recorded at a value of $500. |
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On April 11, 2014, the Company’s Board of Directors approved the filing of a Certificate of Designation of the Preferences and Rights of Series B Preferred Stock of Green Innovations Ltd. (“Certificate of Designation”) with the Secretary of State of the State of Nevada authorizing the creation of a new series of preferred stock designated as “Series B Preferred Stock” pursuant to the authority granted to the Board of Directors under the Company’s Amended and Restated Certificate of Incorporation and Section NRS 78.1955 of the Nevada General Corporation Law. The Certificate of Designation was filed with the Nevada Department of State on April 14, 2014. The Certificate of Designation designated 250,000 shares of the Company’s preferred stock as Series B Preferred Stock. Each holder of Series B Preferred Stock will be entitled to participate in dividends or distributions payable to holders of the Company’s common stock at a rate of the dividend payable to each share of Common Stock multiplied by the number of shares of Common Stock that each share of such holder’s Series B Preferred Stock is convertible into. Each share of Series B Preferred Stock is convertible, at the option of the holder of the Series B Preferred Stock, into one share of the Company’s common stock. Shares of the Series B Preferred Stock will be issued to certain officers of the Company as the Board determines for consideration of the exchange for shares of Series A Preferred Stock of the Company, as already issued. Each share of Series B Preferred Stock will be entitled to one thousand (1,000) votes on all matters submitted to a vote of the stockholders of the Company (“Enhanced Voting Rights”). |
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Upon the liquidation, dissolution or winding up of the Company, the holders of the Series B Preferred Stock will participate in the distribution of the Company’s assets with the holders of the Company’s Common Stock pro rata based on the number of shares of Common Stock held by each (assuming conversion of all shares of Series B Preferred Stock). Due to the Enhanced Voting Rights, following the issuance of shares of Series B Preferred Stock, the holders of the Series B Preferred Stock may be able to exercise voting control over the Company. In such case, the holders of the Series B Preferred Stock may gain the ability to control the outcome of corporate actions requiring stockholder approval, including mergers and other changes of corporate control, going private transactions, and other extraordinary transactions. The concentration of voting control in the Series B Preferred Stock could discourage investments in the Company, or prevent a potential takeover of the Company which may have a negative impact on the value of the Company’s securities. In addition, the liquidation rights granted to the holders of the Series B Preferred Stock will have a dilutive effect on the distributions available to the holders of the Company’s common stock. On April 30, 2014, Harmon returned to the Company 250,000 shares of Series A Preferred Stock in exchange for 250,000 shares of Series B Preferred Stock (see Notes 6 and 10). As of June 30, 2014, there were 250,000 shares issued and outstanding. |
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Common Stock |
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The Company is authorized to issue 50,000,000 shares of common stock, as amended on August 15, 2012, with a par value of $0.0001. The common stock is voting. On September 24, 2012, the Company amended its authorized shares to 150,000,000. |
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On August 15, 2012, the Company had a forward split of its stock with twenty shares for one share as the effect. All instances where common stock is mentioned in these statements reflect the 20:1 split. |
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On September 26, 2012, the Company acquired Green Hygienics in exchange for 49,500,000 shares of common stock of the Company. These shares were issued in October 2012. |
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In October 2012, the two directors and former officers of the Company, Mordechai David and Shamir Benita, cancelled 79,500,000 shares of common stock issued to them. |
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On January 18, 2013, the Company sold 300,000 shares of restricted common stock to Belmont Group Ltd. for $180,000 at a price of $0.60 per share. |
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On February 4, 2013, the Company appointed K. Parmar to its Advisory Board. As compensation for the appointment, K. Parmar was issued 12,500 shares quarterly for his service. |
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On February 7, 2013, the Company and Harmon executed a Share Cancellation / Exchange / Return to Treasury Agreement. Harmon returned to the Company 45,000,000 shares of common stock in exchange for 5,000,000 shares of Series A preferred stock. The common shares were cancelled (see Note 6). |
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On February 11, 2013, the Company appointed Mark DeFilippo (“DeFilippo”) to its Advisory Board. As compensation for the appointment, DeFilippo will be issued 12,500 shares quarterly for his service. These shares were recorded at a value of $0.97 per share (the closing price the previous day) or $12,125. The shares were issued in April 2013 (see Note 6). |
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On February 12, 2013, the Company sold 107,143 shares of restricted common stock to Coventry Capital for $150,000 at a price of $1.40 per share (the closing price the previous day). |
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On February 18, 2013, the Company appointed Sandy Greenberg (“Greenberg”) to its Advisory Board. As compensation for the appointment, Greenberg will be issued 12,500 shares quarterly for his service. These shares were recorded at a value of $2.22 per share (the closing price the previous day) or $27,750. The shares were issued in April 2013 (see Note 6). |
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On February 18, 2013, the Company appointed Michael Perfetti (“Perfetti”) to its Advisory Board. As compensation for the appointment, Perfetti will be issued 12,500 shares quarterly for his service. These shares were recorded at a value of $2.22 per share (the closing price the previous day) or $27,750. The shares were issued in April 2013 (see Note 6). |
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On February 19, 2013, the Company appointed Y. Parmar to its Advisory Board. As compensation for the appointment, Y. Parmar will be issued 12,500 shares quarterly for his service. These shares were recorded at a value of $2.22 per share (the closing price the previous day) or $27,750. The shares were issued in April 2013 (see Note 6). |
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On February 19, 2013, the Company declared a share dividend on a basis of 1.24:1 as of the record date of February 19, 2013, thereby all common shareholders shall receive 0.24 of a share for every one share owned. The Company’s issued and outstanding shall increase from 25,000,000 to 31,000,000 shares of common stock. The shares issued to Y. Parmar, DeFilippo, Greenberg, Perfetti and K. Parmar were not eligible for the dividend as they were not issued. The shares of common stock purchased by Coventry Capital on February 12, 2013 were not issued prior to the dividend therefore the Company issued and additional 46,611 shares of common stock to Coventry Capital for the dividend (see Note 8). The total shares issued for the dividend was 6,046,611 (see Note 8). |
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On February 22, 2013, the Company appointed Rundle to its Advisory Board. As compensation for the appointment, Rundle was to be issued 12,500 shares quarterly for his service. These shares were recorded at a value of $0.51 per share (the closing price the previous day) or $6,375. The shares were issued in April 2013 (see Note 6). |
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On February 22, 2013, the Company contracted with Vincent & Rees (“V&R”) to serve as the Company’s legal counsel. As compensation for the agreement, V&R received 250,000 shares of restricted common stock of the Company. These shares were recorded at a value of $0.51 per share (the closing price the previous day) or $127,500. The shares were issued in April 2013. |
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On April 4, 2013, in exchange for certain assets of Clearly Herbal International Ltd., a British Virgin Islands corporation (“CHI”), the Company paid the owner of CHI 300,000 shares of restricted common stock for an United States trademark (see Note 2). Additionally, the Company has issuable 200,000 shares of restricted common stock for an United Kingdom trademark (see Note 2). The value of the two transactions was $600,000 or $1.20 per share. As a condition of the acquisition, the Company guaranteed that the 10-day volume weighted average price on the date six months after closing to be at least $1.20. The Company was obligated to issue additional shares of restricted common stock should the price be below $1.20. On October 4, 2013, the common stock of the Company was $0.18 therefore, on October 7, 2013 an additional 1,700,000 shares of restricted stock were issued (see Notes 2 and 5). |
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On April 4, 2013, Y. Parmar, a member of the Advisory Board, purchased 100,000 shares of common stock at a discounted price of $0.54 per share for $50,000 (see Note 6). |
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On April 4, 2013, Alain Cameron purchased 55,555 shares of common stock at a discounted price of $0.54 per share for $30,000. |
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On April 15, 2013, the Company granted 300,000 shares of common stock to Rundle, the chief executive officer of the Company, as part of his employment agreement. The Company recorded the value of the shares at $268,750 or $0.90 per share (see Note 6). |
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On May 8, 2013, N. Parmar, a co-owner of American Hygienics Corporation, a supplier to the Company, purchased 125,000 shares of common stock at a discounted price of $0.40 per share for $50,000. |
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On May 8, 2013, K. Parmar, a member of the Advisory Board and co-owner of American Hygienics Corporation, a supplier to the Company, purchased 125,000 shares of common stock at a discounted price of $0.40 per share for $50,000 (see Note 6). |
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On May 16, 2013, the Company amended the agreements with Harmon and RJR Manufacturers’ Agent (“RJR”) to issue shares equal to the contractual obligation to Rundle’s employment agreement. Harmon was issued 300,000 shares and RJR has 300,000 shares issuable, at a value of $168,000 each or $0.56 per share. See Note 6 in regards to Harmon. |
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On June 15, 2013, the Company issued 20,000 shares of common stock to a consultant for services rendered for June. The shares were recorded at a cost of $9,300. |
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On June 18, 2013, the Company issued to BCJ, the Company’s corporate counsel, 111,905 shares of common stock as part of its annual engagement with BCJ, 100,000 shares due on June 1, 2013, and 11,905 shares for the partial month of May, for legal services. The shares were issued at the previous day’s closing price of $0.49 or $54,833. The 100,000 shares will be amortized over one year. |
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On June 18, 2013, the Company issued 10,000 shares of common stock to Black Mountain Equities, Inc. as a conditional of financing (see Note 4). The shares were recorded as a debt discount of $5,000 as the stock was valued at $0.50 per share. |
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On June 18, 2013, the Company issued 62,500 shares or 12,500 each, to its Advisory Board, Perfetti, Y. Parmar, K. Parmar, Sandberg, and DeFilippo. The shares were valued collectively at $28,750. |
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On June 18, 2013, the Company issued 20,000 shares of common stock as compensation to a consultant in regards to services rendered. |
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On June 30, 2013, the Company recorded 22,635 shares of common stock issuable to BCJ for June legal fees. The shares were valued at $8,375, or $0.37 per share, and due to an averaging method of calculation, a $3,375 loss on issuance was recorded. The shares were issued in July 2013. |
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On July 5, 2013, the Company issued 35,000 shares of common stock as compensation to a consultant in regards to services rendered. The shares were recorded at a cost of $9,451. |
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On July 12, 2013, as a condition of financing, the Company issued JMJ 24,390 shares of common stock. The stock, based on the prior day’s closing price of $0.31, was valued at $7,561 and was recorded as a cost of financing. On October 30, 2013, as a condition of the settlement with JMJ, these shares were committed to be returned to the Company (see Notes 4 and 8). The shares were returned on January 6, 2014. |
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On July 9, 2013, W. Ray Harrison, Jr., a former employee of the Company, exercised his 500,000 warrants for common stock on a cashless basis using the prior day’s closing price of $0.3378 thereby a forfeiture of 14,801 shares with an issuance of 485,199 shares of common stock (see Note 6). |
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On July 12, 2013, W. Ray Harrison, Jr., a former employee of the Company, exercised his 250,000 options for common stock on a cashless basis based on the prior day’s closing price of $0.305 thereby a forfeiture of 8,196 shares with an issuance of 241,804 shares of common stock (see Note 6). |
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On July 25, 2013, we issued 3,600,000 shares of our common stock to Ironridge. The issuance is exempt from registration pursuant to Section 3(a)(10) of the Securities Act of 1933, as amended, as the issuance of securities was in exchange for bona fide outstanding claims, where the terms and conditions of such issuance were approved by a court after a hearing upon the fairness of such terms and conditions. See Notes 5 and 7. |
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On July 29, 2013, the Company issued 35,000 shares of common stock as compensation to a consultant in regards to services rendered. The shares were recorded at a cost of $9,450. |
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On July 29, 2013, as part of an engagement agreement with RedChip Companies, Inc., a public and investor relations firm, the Company issued 300,000 shares of common stock. The shares were recorded at a cost of $81,300. |
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On August 16, 2013, the Company issued 12,500 shares of common stock to Hilton Kahn, a member of the Advisory Board, as his quarterly compensation. The shares were valued at $0.278 per share, the previous day’s price based on July 15, 2013, the date of the contractual obligation, or $3,500. See Note 6. |
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On August 16, 2013, the Company issued RJR Manufacturers’ Agent 300,000 shares of common stock, as compensation for services. The shares were valued at $0.278 per share, or $83,370. |
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On August 16, 2013, the Company issued Bruce Harmon, the Company’s CFO, 300,000 shares of common stock, as compensation for services. The shares were valued at $0.278 per share, or $83,370 (see Note 6). |
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On September 5, 2013, the Company issued DBA 300,000 shares of common stock, as compensation for services. The shares were valued at $0.20 per share, or $60,000. The shares have a three year vesting therefore will be amortized accordingly. As of June 30, 2014, $17,500 has been expensed. See Note 6. |
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On September 5, 2013, the Company issued Jeff Thurgood, the Company’s Vice President of Sales, 250,000 shares of common stock, as compensation for services. The shares were valued at $0.20 per share, or $50,000. The shares have a three year vesting therefore will be amortized accordingly. As of June 30, 2014, $14,305 has been expensed. See Note 6. |
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On September 6, 2013, the Company issued 35,161 shares of common stock to BCJ for August legal fees. The shares were valued at $10,267, or $0.29 per share, and due to an averaging method of calculation, a $10,267 loss on issuance was recorded. |
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On September 6, 2013, the Company issued 41,254 shares of common stock to BCJ for September legal fees. The shares were valued at $9,488.42, or $0.23 per share, and due to an averaging method of calculation, a $5,488 loss on issuance was recorded. |
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On September 12, 2013, RJR Manufacturers’ Agent exercised these warrants on a cashless basis based on the prior day’s closing price of $0.3378 thereby a forfeiture of 72,992 shares with an issuance of 927,008 shares of common stock. |
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On September 13, 2013, the Company sold 26,087 shares of restricted common stock to an individual for $3,000. The shares sold were discounted by 25% due to the restriction and a loss of $1,043 was recorded. |
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On September 18, 2013, the Company issued 200,000 shares of common stock to Kalpesh Vyas as payment for the finalization of the transfer of ownership of the United Kingdom Clearly Herbal trademark (see Notes 2 and 5). |
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On September 18, 2013, the Company issued Tauriga 625,000 shares of common stock as obligated under the licensing agreement between Tauriga and GHI (see Note 2). |
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On September 18, 2013, the Company issued a shareholder 264 shares of common stock as part of the February 2013 dividend. The shareholder was omitted from the original issuance due to the timing of his ownership. The Company believes that the lack of issuance at the time of dividend was correct but, in order to avoid any potential problems, issued the immaterial amount of shares. The issuance was recorded as a loss of $73 based on the prior day’s closing price of $0.275. |
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On September 25, 2013, we issued 3,000,000 shares of our common stock to Ironridge. The issuance is exempt from registration pursuant to Section 3(a)(10) of the Securities Act of 1933, as amended, as the issuance of securities was in exchange for bona fide outstanding claims, where the terms and conditions of such issuance were approved by a court after a hearing upon the fairness of such terms and conditions. See Notes 5 and 7. |
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On October 7, 2013, the Company issued 62,500 shares or 12,500 each, to its Advisory Board, Perfetti, Y. Parmar, K. Parmar, Sandberg, and DeFilippo. The shares were valued collectively at $14,375. See Note 6. |
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On October 8, 2013, the Company issued 44,307 shares of common stock to BCJ for legal services. The shares were valued at $13,723, or $0.31 per share, and due to an averaging method of calculation, a $4,861 loss on issuance was recorded. |
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On October 8, 2013, the Company issued Clearly Herbal International, a British Virgin Island corporation, an additional 1,700,000 shares of common stock in regards to the Clearly Herbal U.S. trademark and to Clearly Herbal International, a UK corporation, an additional 1,333,333 shares of common stock in regards to the Clearly Herbal UK trademark (see Notes 2 and 5). |
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On October 15, 2013, the Company issued 12,500 shares to Hilton Kahn, a new member of the Company’s Advisory Board. The shares were valued at $2,250. See Note 6. |
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On October 23, 2013, the Company issued 2,316,595 shares to TCA in conjunction with the financing provided by TCA. The shares were valued at $250,000. See Notes 4 and 5. |
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On October 23, 2013, we issued 4,200,000 shares of our common stock to Ironridge. The issuance is exempt from registration pursuant to Section 3(a)(10) of the Securities Act of 1933, as amended, as the issuance of securities was in exchange for bona fide outstanding claims, where the terms and conditions of such issuance were approved by a court after a hearing upon the fairness of such terms and conditions. See Notes 5 and 7. |
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On October 31, 2013, the Company issued 40,000 shares of common stock to BCJ for legal services. The shares were valued at $5,600, or $0.14 per share, and due to an averaging method of calculation, a $1,600 loss on issuance was recorded. |
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On November 1, 2013, the Company issued 15,000 shares of common stock to Charles Andrews, a member of the Board of Directors of the Company. The shares were valued at $2,100. See Note 6. |
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On November 1, 2013, the Company issued 65,488 shares of common stock to BCJ for legal services. The shares were valued at $14,337, or $0.22 per share, and due to an averaging method of calculation, a $5,168 loss on issuance was recorded. |
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On November 25, 2013, the Company issued 46,611 shares of common stock to Coventry Capital in regards to the February 2013 dividend. |
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On November 25, 2013, the Company issued 30,000 shares of common stock to Robert Brennan, a consultant to the Company. Mr. Brennan had previously been issued 30,000 warrants for common stock which was cancelled. The shares were valued at $3,900. |
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On November 25, 2013, the Company issued 30,000 shares of common stock to Jean-Michel Fitamant, a consultant to the Company. The shares were valued at $3,900. |
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On November 25, 2013, the Company issued 30,000 shares of common stock to Michele Harris, a leased employee to the Company (became employee in January 2014). The shares were valued at $3,900. |
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On December 1, 2013, the Company issued 176,219 shares of common stock to BCJ for legal services. The shares were valued at $38,293, or $0.22 per share, and due to an averaging method of calculation, a $17,146 loss on issuance was recorded. |
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On December 16, 2013, we issued 4,400,000 shares of our common stock to Ironridge. The issuance is exempt from registration pursuant to Section 3(a)(10) of the Securities Act of 1933, as amended, as the issuance of securities was in exchange for bona fide outstanding claims, where the terms and conditions of such issuance were approved by a court after a hearing upon the fairness of such terms and conditions. See Notes 5 and 7. |
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On January 1, 2014, the Company issued 131,492 shares of common stock to BCJ for legal services. The shares were valued at $10,519, or $0.08 per share, and due to an averaging method of calculation, a $6,519 loss on issuance was recorded. |
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On January 2, 2014, the Company sold 190,476 shares of restricted common stock to an individual for $10,000. The shares sold were discounted by 25% due to the restriction and a loss of $4,876 was recognized. |
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On January 3, 2014, the Company issued 51,471 shares of common stock to Octane, Inc. (“Octane”) for services. The shares were valued at $4,118, or $0.08 per share, and due to a discount due to the restriction, a $1,493 loss on issuance was recorded. |
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On January 6, 2014, the Company cancelled 24,390 shares of common stock that were previously issued to JMJ (see Note 4). As a condition of the payment of the note to JMJ on October 30, 2013, these shares were agreed to be returned and cancelled. |
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On January 8, 2014, Black Mountain converted $10,000 of principal of the note dated June 12, 2013, into 263,505 shares of common stock, valued at $21,080. A loss on conversion of $11,080 was recorded. See Note 4. |
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On January 17, 2014, the Company issued 2,684,964 shares of common stock to TCA (see Notes 4 and 5) in conjunction with the financing provided by TCA. The shares were valued at $225,537. The shares have a guaranteed value of $112,500 and TCA cannot exceed that amount. As applicable, upon sale and recognition of the above stated compensation, any remaining shares will be returned to the Company for cancellation. The Company recorded a receivable of $113,037 in records to the over issuance value. |
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On January 22, 2014, the Company sold 152,000 shares of restricted common stock to an employee for $9,975. The shares sold were discounted by 25% due to the restriction and a loss of $3,705 was recorded. |
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On January 24, 2014, Black Mountain converted $55,000 of principal and $5,500 of accrued interest of the note dated June 12, 2013, into 1,231,708 shares of common stock, valued at $160,122. A loss on conversion of $99,622 was recorded. See Note 4. |
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On February 1, 2014, the Company issued 15,000 shares of common stock to Charles Andrews, a director of the Company (see Note 6), for services. The shares were valued at $1,800, or $0.12 per share. |
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On February 1, 2014, the Company issued 88,418 shares of common stock to BCJ for legal services. The shares were valued at $10,610, or $0.12 per share, and due to an averaging method of calculation, a $6,610 loss on issuance was recorded. |
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On February 4, 2014, the Company issued 4,000,000 shares of our common stock to Ironridge. The issuance is exempt from registration pursuant to Section 3(a)(10) of the Securities Act of 1933, as amended, as the issuance of securities was in exchange for bona fide outstanding claims, where the terms and conditions of such issuance were approved by a court after a hearing upon the fairness of such terms and conditions. See Notes 5 and 7. |
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On March 1, 2014, the Company issued 97,915 shares of common stock to BCJ for legal services. The shares were valued at $11,750, or $0.12 per share, and due to an averaging method of calculation, a $7,750 loss on issuance was recorded. |
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On March 19, 2014, the Company issued 50,000 shares of common stock to BCJ for additional legal services outside of the agreement between the parties. The shares were valued at $5,000, or $0.10 per share. |
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On March 19, 2014, 900,000 shares of common stock that were authorized for issuance in 2013 but never issued and recorded as issuable, were issued. |
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On March 20, 2014, we issued 4,500,000 shares of our common stock to Ironridge. The issuance is exempt from registration pursuant to Section 3(a)(10) of the Securities Act of 1933, as amended, as the issuance of securities was in exchange for bona fide outstanding claims, where the terms and conditions of such issuance were approved by a court after a hearing upon the fairness of such terms and conditions. See Notes 5 and 7. |
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On March 25, 2014, the Company issued 150,000 shares of common stock to American Capital Ventures (“ACV”) for investor relation services for three months. The shares were valued at $15,000, or $0.10 per share. |
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On April 1, 2014, the Company issued 98,804 shares of common stock to BCJ for legal services. The shares were valued at $9,880, or $0.10 per share, and due to an averaging method of calculation, a $5,880 loss on issuance was recorded. |
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On April 18, 2014, the Company issued 2,500,000 shares of common stock to Mirador Consulting, LLC (“Mirador”) for management consulting for six months. The shares were valued at $225,000, or $0.09 per share. As of June 30, 2014, $93,750 has been expensed and the remaining will be amortized over the remaining period of the contract. |
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On April 18, 2014, the Company cancelled 87,500 shares of common stock that had been incorrectly issued to the Advisory Board in prior periods. |
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On April 30, 2014, the Company issued 50,000 shares of common stock to Charles Andrews, a director of the Company (see Note 6), for services. The shares were valued at $4,375, or $0.0875 per share. |
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On May 1, 2014, the Company issued 109,589 shares of common stock to BCJ for legal services. The shares were valued at $9,863, or $0.09 per share, and due to an averaging method of calculation, a $5,863 loss on issuance was recorded. |
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On May 20, 2014, we issued 2,500,000 shares of our common stock to Ironridge. The issuance is exempt from registration pursuant to Section 3(a)(10) of the Securities Act of 1933, as amended, as the issuance of securities was in exchange for bona fide outstanding claims, where the terms and conditions of such issuance were approved by a court after a hearing upon the fairness of such terms and conditions. See Notes 5 and 7. |
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On June 1, 2014, the Company issued 131,079 shares of common stock to BCJ for legal services. The shares were valued at $10,486, or $0.08 per share, and due to an averaging method of calculation, a $6,486 loss on issuance was recorded. |
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On June 13, 2014, the Company issued 300,000 shares of common stock to John H. Shaw (“Shaw”) for corporate communications for six months. The shares were valued at $21,000, or $0.07 per share. |
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Stock Warrants |
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The Company has granted warrants to employees. As of June 30, 2014 and December 31, 2013, the balance was zero and there was no activity in the period. |
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On November 19, 2012, the Company issued 500,000 fully vested warrants with an exercise price of $0.01 per share for common stock to W. Ray Harrison, Jr. as compensation for the APA with SBI-TX (see Note 3). The warrants were valued at $0.58 per warrant or $290,000 using the average price for our common stock. On July 9, 2013, Mr. Harrison exercised these warrants on a cashless basis based on the prior day’s closing price of $0.3378 thereby a forfeiture of 14,801 shares with an issuance of 485,199 shares of common stock. See Note 2 and 6. |
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The Company has granted warrants to non-employees. Warrant activity for non-employees the six months ended June 30, 2014 is as follows: |
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| | | | | | | | Weighted | | | | |
| | | | | Weighted | | | Average | | | | |
| | | | | Average | | | Remaining | | | Aggregate | |
| | Number | | | Exercise | | | Contractual | | | Intrinsic | |
| | of Warrants | | | Price | | | Terms | | | Value | |
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Outstanding at December 31, 2013 | | | 2,111,111 | | | $ | 0.076 | | | | | | | | | |
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Granted | | | - | | | $ | - | | | | | | | | | |
Forfeited | | | - | | | | - | | | | | | | | | |
Exercised | | | - | | | $ | - | | | | | | | | | |
| | | | | | | | | | | | | | | | |
Outstanding at June 30, 2014 | | | 2,111,111 | | | $ | 0.076 | | | | 4.05 | | | $ | 52,000 | |
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Exercisable at June 30, 2014 | | | 2,111,111 | | | $ | 0.076 | | | | | | | | | |
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Weighted Average Grant Date Fair Value | | | | | | $ | - | | | | | | | | | |
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On November 1, 2012, the Company issued 1,000,000 fully vested warrants with an exercise price of $0.01 per share for common stock to RJR Manufacturers’ Agent as compensation for services. The warrants were valued at $0.43 per warrant or $430,000 using the average price for our common stock. On September 12, 2013, RJR Manufacturers’ Agent exercised these warrants on a cashless basis based on the prior day’s closing price of $0.3378 thereby a forfeiture of 72,992 shares with an issuance of 927,008 shares of common stock. |
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On March 17, 2013, the Company issued 1,000,000 fully vested warrants with an exercise price of $0.01 per share for common stock to Ecotrade Solutions Ltd. as compensation for services. The warrants were valued at $0.88 per warrant or $880,000 using the average price for our common stock. |
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On August 13, 2013, the Company issued 30,000 warrants with an exercise price of $0.28 per share for common stock to Robert Brennan, a consultant to the Company, as compensation for services. On November 25, 2013, the Company cancelled the warrants and issued Mr. Brennan 30,000 shares of common stock. |
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On November 1, 2013, the Company issued 1,111,111 fully vested warrants with an exercise price of $0.135 per share for common stock to RJR Manufacturers’ Agent as compensation for services. The warrants were valued at $0.135 per warrant or $150,000 using the current price for our common stock. |
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Stock Options |
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The Company approved the 2012 Stock Option Plan on November 14, 2012 under which 10,000,000 shares were reserved for issuance. |
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The Company has granted options to employees. Options activity for the six months ended June 30, 2014 is as follows: |
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| | | | | Weighted | | | Weighted Average | | | | |
| | | | | Average | | | Remaining | | | Aggregate | |
| | Number | | | Exercise | | | Contractual | | | Intrinsic | |
| | of Options | | | Price | | | Terms | | | Value | |
| | | | | | | | | | | | | | | |
Outstanding at December 31, 2013 | | 2,111,111 | | | $ | 0.076 | | | | | | | | | |
| | | | | | | | | | | | | | | |
Granted | | 1,111,111 | | | $ | 0.1 | | | | | | | | | |
Exercised | | - | | | $ | - | | | | | | | | | |
Forfeited | | | - | | | | - | | | | | | | | | |
Expired | | | - | | | $ | - | | | | | | | | | |
| | | | | | | | | | | | | | | | |
Outstanding at June 30, 2014 | | | 3,222,222 | | | $ | 0.084 | | | | 9.16 | | | $ | 52,000 | |
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Exercisable at June 30, 2014 | | | 3,222,222 | | | $ | 0.082 | | | | | | | | | |
| | | | | | | | | | | | | | | | |
Weighted Average Grant Date Fair Value | | | | | | $ | 0.1 | | | | | | | | | |
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On November 14, 2012, the Company granted Bruce Harmon 1,000,000 options for common stock. The options are fully-vested at issuance, have a five-year life, and have an exercise price of $0.01. The options were valued at $0.53 per option or $530,000 using the average price of our common stock. See Note 6. |
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On November 14, 2012, the Company granted W. Ray Harrison, Jr. 250,000 options for common stock. The options are fully-vested at issuance, have a five-year life, and have an exercise price of $0.01. The options were valued at $0.53 per option or $132,500 using the average price of our common stock. On July 12, 2013, Mr. Harrison exercised these options on a cashless basis based on the prior day’s closing price of $0.305 thereby a forfeiture of 8,196 shares with an issuance of 241,804 shares of common stock (see Note 6). |
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On November 1, 2013, the Company granted Bruce Harmon 1,111,111 options for common stock. The options are fully-vested at issuance, have a five-year life, and have an exercise price of $0.135. The options were valued at $0.135 per option or $150,000. See Note 6. |
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On April 1, 2014, the Company granted Philip Rundle 1,111,111 options for common stock. The options are fully-vested at issuance, have a five-year life, and have an exercise price of $0.10. The options were valued at $0.10 per option or $111,111. See Note 6. |