Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Mar. 26, 2015 | Jun. 30, 2014 | |
Document And Entity Information | |||
Entity Registrant Name | PREMIER BIOMEDICAL INC | ||
Entity Central Index Key | 1515740 | ||
Document Type | 10-K | ||
Document Period End Date | 31-Dec-14 | ||
Amendment Flag | FALSE | ||
Current Fiscal Year End Date | -19 | ||
Is Entity a Well-known Seasoned Issuer? | No | ||
Is Entity a Voluntary Filer? | No | ||
Is Entity's Reporting Status Current? | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Public Float | $3,472,894 | ||
Entity Common Stock, Shares Outstanding | 21,757,175 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2014 |
BALANCE_SHEETS
BALANCE SHEETS (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Current assets: | ||
Cash | $102,599 | $15,800 |
Prepaid Expenses | 9,450 | 6,000 |
Loan origination costs | 3,473 | |
Total current assets | 115,522 | 21,800 |
Property and equipment, net | 5,109 | 3,689 |
Total assets | 120,631 | 25,489 |
Current liabilities: | ||
Accounts Payable | 147,491 | 122,334 |
Accounts payable, related parties | 25,299 | 39,872 |
Accrued interest | 721 | 3,298 |
Convertible notes payable, net of discounts of $71,621 and $-0- at December 31, 2014 and 2013, respectively | 14,879 | |
Notes payable, related parties | 109,000 | |
Total current liabilities | 188,390 | 274,504 |
Commitments and contingencies | ||
Stockholders' equity (deficit): | ||
Preferred stock, $0.001 par value, 10,000,000 shares authorized, no shares issued and outstanding | ||
Common stock, $0.00001 par value, 300,000,000 shares authorized, 21,757,175 and 18,355,819 shares issued and outstanding at December 31, 2014 and 2013, respectively | 218 | 184 |
Additional paid in capital | 8,127,649 | 6,535,913 |
Accumulated deficit | -8,195,626 | -6,785,112 |
Total stockholders' equity (deficit) | -67,759 | -249,015 |
Total liabilities and stockholders' equity (deficit) | $120,631 | $25,489 |
BALANCE_SHEETS_Parenthetical
BALANCE SHEETS (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Current liabilities: | ||
Convertible notes payable, net of discounts | $71,621 | $0 |
Stockholders' equity (deficit): | ||
Preferred stock, par value | $0.00 | $0.00 |
Preferred stock, authorized shares | 10,000,000 | 10,000,000 |
Preferred stock, issued shares | 0 | 0 |
Preferred stock, outstanding shares | 0 | 0 |
Common stock, par value | $0.00 | $0.00 |
Common stock, authorized shares | 300,000,000 | 300,000,000 |
Common stock, issued shares | 21,757,175 | 18,355,819 |
Common stock, outstanding shares | 21,757,175 | 18,355,819 |
STATEMENTS_OF_OPERATIONS
STATEMENTS OF OPERATIONS (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Statements Of Operations | ||
Revenue | ||
Operating expenses: | ||
Research and development | 196,179 | 217,350 |
General and administrative | 223,434 | 3,024,108 |
Professional fees | 949,319 | 1,235,270 |
Total operating expenses | 1,368,932 | 4,476,728 |
Net operating loss | -1,368,932 | -4,476,728 |
Other expense: | ||
Interest expense | -41,582 | -400,420 |
Total other expenses | -41,582 | -400,420 |
Net loss | -1,410,514 | -4,877,148 |
Deemed dividend | -79,923 | |
Net loss attributable to common stockholders | ($1,410,514) | ($4,957,071) |
Weighted average number of common shares outstanding - basic and fully diluted | 20,408,658 | 15,829,277 |
Net loss per share - basic and fully diluted | ($0.07) | ($0.31) |
STATEMENT_OF_STOCKHOLDERS_EQUI
STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT) (USD $) | Preferred Stock | Common Stock | Additional Paid-In Capital | Subscriptions Payable | (Deficit) Accumulated During Development Stage | Total |
Beginning Balance, Amount at Dec. 31, 2012 | $124 | $1,732,151 | $20,000 | ($1,828,041) | ($75,766) | |
Beginning Balance, Shares at Dec. 31, 2012 | 12,374,479 | |||||
Imputed interest on non-interest bearing related party debts | 840 | -840 | ||||
Warrants granted for services, related parties | 21,736 | 21,736 | ||||
Amortization of warrants granted for services, related parties | 259,044 | 259,044 | ||||
Amortization of warrants granted for services | 74,314 | 74,314 | ||||
Modication of warrants, expiration of 190,289 warrants extended to July 23, 2013 | 79,923 | -79,923 | ||||
Common stock issued as a commitment fee on financing, Kodiak Capital Group, LLC, Amount | 6 | 352,253 | 352,259 | |||
Common stock issued as a commitment fee on financing, Kodiak Capital Group, LLC, Shares | 559,140 | |||||
Common stock issued for services, Amount | 10 | 699,340 | 699,350 | |||
Common stock issued for services, Shares | 985,000 | |||||
Common stock sold to Directors at $0.05 per share, Amount | 40 | 199,960 | 200,000 | |||
Common stock sold to Directors at $0.05 per share, Shares | 4,000,000 | |||||
Fair value of common stock in excess of cash value of stock sold to Directors | 2,965,000 | 2,965,000 | ||||
Exercise of warrants at $0.50 per share, Amount | 1 | 30,499 | 30,500 | |||
Exercise of warrants at $0.50 per share, Shares | 61,000 | |||||
Exercise of warrants at $0.10 per share, Amount | 2 | 22,618 | 22,620 | |||
Exercise of warrants at $0.10 per share, Shares | 226,200 | |||||
Units of common stock and warrants sold at $0.50 per share, Amount | 1 | 74,999 | -20,000 | 55,000 | ||
Units of common stock and warrants sold at $0.50 per share, Shares | 150,000 | |||||
Beneficial conversion feature of convertible note | 23,236 | 23,236 | ||||
Net loss | -4,877,148 | -4,877,148 | ||||
Ending Balance, Amount at Dec. 31, 2013 | 184 | 6,535,913 | -6,785,112 | -249,015 | ||
Ending Balance, Shares at Dec. 31, 2013 | 18,355,819 | |||||
Common stock sold for cash at $0.10 per share, Amount | 5 | 50,995 | 51,000 | |||
Common stock sold for cash at $0.10 per share, Shares | 510,000 | |||||
Imputed interest on non-interest bearing related party debts | 134 | -134 | ||||
Warrants granted as debt discount on convertible note | 37,981 | 37,981 | ||||
Amortization of warrants granted for services, related parties | 394,540 | 394,540 | ||||
Amortization of warrants granted for services | 96,767 | 96,767 | ||||
Common stock issued for services, Amount | 9 | 263,070 | 263,079 | |||
Common stock issued for services, Shares | 853,462 | |||||
Common stock sold for cash to Kodiak Capital Group, LLC, Amount | 20 | 699,980 | 700,000 | |||
Common stock sold for cash to Kodiak Capital Group, LLC, Shares | 2,022,894 | |||||
Exercise of warrants at $0.75 per share, Amount | 11,250 | 11,250 | ||||
Exercise of warrants at $0.75 per share, Shares | 15,000 | |||||
Beneficial conversion feature of convertible note | 37,019 | 37,019 | ||||
Net loss | -1,410,514 | -1,410,514 | ||||
Ending Balance, Amount at Dec. 31, 2014 | $218 | $8,127,649 | ($8,195,626) | ($67,759) | ||
Ending Balance, Shares at Dec. 31, 2014 | 21,757,175 |
STATEMENTS_OF_CASH_FLOWS
STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net (loss) | ($1,410,514) | ($4,877,148) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation | 954 | 767 |
Amortization of loan origination costs | 527 | |
Imputed interest on non-interest bearing related party debts | 134 | 840 |
Amortization of debt discount | 10,879 | 23,236 |
Stock based compensation, related parties | 394,540 | 3,224,044 |
Stock based compensation | 359,846 | 1,147,659 |
Decrease (increase) in assets: | ||
Prepaid expenses | -3,450 | -5,931 |
Increase (decrease) in liabilities: | ||
Accounts payable | 25,157 | 33,736 |
Accounts payable, related parties | -14,573 | 21,309 |
Accrued interest | -2,577 | 3,298 |
Net cash used in operating activities | -639,077 | -428,190 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchases of property and equipment | -2,374 | -1,414 |
Net cash used in investing activities | -2,374 | -1,414 |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from convertible notes payable | 75,000 | 26,500 |
Repayments on convertible note payable | -26,500 | |
Proceeds from notes payable, related parties | 100,000 | |
Repayments on notes payable, related parties | -109,000 | -3,000 |
Proceeds from the sale of common stock | 762,250 | 308,120 |
Net cash provided by financing activities | 728,250 | 405,120 |
NET CHANGE IN CASH | 86,799 | -24,484 |
CASH AT BEGINNING OF PERIOD | 15,800 | 40,284 |
CASH AT END OF PERIOD | 102,599 | 15,800 |
SUPPLEMENTAL INFORMATION: | ||
Interest paid | 32,619 | 20,787 |
Income taxes paid | ||
NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||
Discount on beneficial conversion feature on convertible note | 37,019 | 23,236 |
Cashless exercise of common stock warrants, 250,000 warrants exercised | 37,981 | |
Deemed dividend on modification of warrants issued in equity offering | $79,923 |
Nature_of_Business_and_Signifi
Nature of Business and Significant Accounting Policies | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Nature Of Business And Significant Accounting Policies | |||||||||
Note 1 - Nature of Business and Significant Accounting Policies | Nature of Business | ||||||||
Premier Biomedical, Inc. (“the Company”) was incorporated in the State of Nevada on May 10, 2010 (“Inception”). The Company was formed to develop and market medications and procedures that address a significant number of the most highly visible health issues currently affecting mankind. The Company will market these medications and procedures to leading worldwide pharmaceutical firms via publication in medical journals and by direct contact. | |||||||||
These statements reflect all adjustments, consisting of normal recurring adjustments, which in the opinion of management are necessary for fair presentation of the information contained therein. | |||||||||
JOBS Act | |||||||||
We are an “emerging growth company” as defined in the recently-enacted JOBS Act, and we are eligible to take advantage of certain exemptions from various reporting and disclosure requirements that are applicable to public companies that are not “emerging growth companies.” As an “emerging growth company” under the JOBS Act, we are permitted to, and intend to, rely on exemptions from certain reporting and disclosure requirements, which may make our future public filings different than that of other public companies. | |||||||||
Section 107 of the JOBS Act provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an “emerging growth company” can delay the adoption of certain new accounting standards until those standards would otherwise apply to private companies. We have elected to use the extended transition period for complying with new or revised accounting standards under Section 102(b)(2) of the JOBS Act, that allows us to delay the adoption of new or revised accounting standards that have different effective dates for public and private companies until those standards apply to private companies. As a result of this election, our financial statements may not be comparable to companies that comply with public company effective dates. | |||||||||
We will remain an “emerging growth company” until the earliest of: (i) the last day of the fiscal year during which we had total annual gross revenues of $1 billion or more, (ii) the last day of the fiscal year following the fifth anniversary of the date of the first sale of our common stock pursuant to an effective registration statement, (iii) the date on which we have, during the previous 3-year period, issued more than $1 billion in non-convertible debt or (iv) the date on which we are deemed a “large accelerated filer” as defined under the federal securities laws. | |||||||||
Use of Estimates | |||||||||
The preparation of financial statements in conformity with accounting principles generally accepted in the United States 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 the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. | |||||||||
Cash and Cash Equivalents | |||||||||
We maintain cash balances in non-interest-bearing accounts, which do not currently exceed federally insured limits. For the purpose of the statements of cash flows, all highly liquid investments with an original maturity of three months or less are considered to be cash equivalents. | |||||||||
Patent Rights and Applications | |||||||||
Patent rights and applications costs include the acquisition costs and costs incurred for the filing of patents. Patent rights and applications are amortized on a straight-line basis over the legal life of the patent rights beginning at the time the patents are approved. Patent costs for unsuccessful patent applications are expensed when the application is terminated. | |||||||||
Fair Value of Financial Instruments | |||||||||
Under FASB ASC 820-10-05, the Financial Accounting Standards Board establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosures about fair value measurements. This Statement reaffirms that fair value is the relevant measurement attribute. The adoption of this standard did not have a material effect on the Company’s financial statements as reflected herein. The carrying amounts of cash, prepaid expenses and accrued expenses reported on the balance sheet are estimated by management to approximate fair value primarily due to the short term nature of the instruments. | |||||||||
Basic and Diluted Loss Per Share | |||||||||
The basic net loss per common share is computed by dividing the net loss by the weighted average number of common shares outstanding. Diluted net loss per common share is computed by dividing the net loss adjusted on an “as if converted” basis, by the weighted average number of common shares outstanding plus potential dilutive securities. For the periods presented, potential dilutive securities had an anti-dilutive effect and were not included in the calculation of diluted net loss per common share. | |||||||||
Stock-Based Compensation | |||||||||
Under FASB ASC 718-10-30-2, all share-based payments to employees, including grants of employee stock options, to be recognized in the income statement based on their fair values. Pro forma disclosure is no longer an alternative. The Company’s stock based compensation consisted of the following during the years ended December 31, 2014 and 2013, respectively: | |||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Common stock issued for services | $ | 263,079 | $ | 1,051,609 | |||||
Common stock issued for services, related parties | - | 2,965,000 | |||||||
Warrants issued for services | 96,767 | 96,050 | |||||||
Warrants issued for services, related parties | 394,540 | 259,044 | |||||||
Total stock based compensation | $ | 754,386 | $ | 4,371,703 | |||||
Revenue Recognition | |||||||||
Sales on fixed price contracts are recorded when services are earned, the earnings process is complete or substantially complete, and the revenue is measurable and collectability is reasonably assured. Provisions for discounts and rebates to customers, estimated returns and allowances, and other adjustments are provided for in the same period the related sales are recorded. The Company defers any revenue from sales in which payment has been received, but the earnings process has not occurred. Sales have not yet commenced. | |||||||||
Advertising and Promotion | |||||||||
All costs associated with advertising and promoting products are expensed as incurred. These expenses were $159,411 and $25,507 for the years ended December 31, 2014 and 2013, respectively. | |||||||||
Income Taxes | |||||||||
Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. A valuation allowance is provided for significant deferred tax assets when it is more likely than not, that such asset will not be recovered through future operations. | |||||||||
Uncertain Tax Positions | |||||||||
In accordance with ASC 740, “Income Taxes” (“ASC 740”), the Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be capable of withstanding examination by the taxing authorities based on the technical merits of the position. These standards prescribe a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. These standards also provide guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. | |||||||||
Various taxing authorities periodically audit the Company’s income tax returns. These audits include questions regarding the Company’s tax filing positions, including the timing and amount of deductions and the allocation of income to various tax jurisdictions. In evaluating the exposures connected with these various tax filing positions, including state and local taxes, the Company records allowances for probable exposures. A number of years may elapse before a particular matter, for which an allowance has been established, is audited and fully resolved. The Company has not yet undergone an examination by any taxing authorities. | |||||||||
The assessment of the Company’s tax position relies on the judgment of management to estimate the exposures associated with the Company’s various filing positions. | |||||||||
Recently Issued Accounting Pronouncements | |||||||||
In June 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-12, Compensation – Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period. The new guidance requires that share-based compensation that require a specific performance target to be achieved in order for employees to become eligible to vest in the awards and that could be achieved after an employee completes the requisite service period be treated as a performance condition. As such, the performance target should not be reflected in estimating the grant-date fair value of the award. Compensation costs should be recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable to the period(s) for which the requisite service has already been rendered. If the performance target becomes probable of being achieved before the end of the requisite service period, the remaining unrecognized compensation cost should be recognized prospectively over the remaining requisite service period. The total amount of compensation cost recognized during and after the requisite service period should reflect the number of awards that are expected to vest and should be adjusted to reflect those awards that ultimately vest. The requisite service period ends when the employee can cease rendering service and still be eligible to vest in the award if the performance target is achieved. This new guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2015. Early adoption is permitted. Entities may apply the amendments in this Update either (a) prospectively to all awards granted or modified after the effective date or (b) retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. The adoption of ASU 2014-12 is not expected to have a material impact on our financial position or results of operations. | |||||||||
In June 2014, the FASB issued ASU No. 2014-10: Development Stage Entities (Topic 915): Elimination of Certain Financial Reporting Requirements, Including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation, to improve financial reporting by reducing the cost and complexity associated with the incremental reporting requirements of development stage entities. The amendments in this update remove all incremental financial reporting requirements from U.S. GAAP for development stage entities, thereby improving financial reporting by eliminating the cost and complexity associated with providing that information. The amendments in this Update also eliminate an exception provided to development stage entities in Topic 810, Consolidation, for determining whether an entity is a variable interest entity on the basis of the amount of investment equity that is at risk. The amendments to eliminate that exception simplify U.S. GAAP by reducing avoidable complexity in existing accounting literature and improve the relevance of information provided to financial statement users by requiring the application of the same consolidation guidance by all reporting entities. The elimination of the exception may change the consolidation analysis, consolidation decision, and disclosure requirements for a reporting entity that has an interest in an entity in the development stage. The amendments related to the elimination of inception-to-date information and the other remaining disclosure requirements of Topic 915 should be applied retrospectively except for the clarification to Topic 275, which shall be applied prospectively. For public companies, those amendments are effective for annual reporting periods beginning after December 15, 2014, and interim periods therein. Early adoption is permitted. The adoption of ASU 2014-10 is not expected to have a material impact on our financial position or results of operations. | |||||||||
In July 2013, the FASB issued ASU No. 2013-11: Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists.The new guidance requires that unrecognized tax benefits be presented on a net basis with the deferred tax assets for such carryforwards. This new guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2013. We do not expect the adoption of the new provisions to have a material impact on our financial condition or results of operations. |
Going_Concern
Going Concern | 12 Months Ended |
Dec. 31, 2014 | |
Going Concern | |
Note 2 - Going Concern | As shown in the accompanying financial statements, the Company has no revenues, incurred net losses from operations resulting in an accumulated deficit of $8,195,626, and had negative working capital of ($72,868) at December 31, 2014. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management is actively pursuing new products and services to begin generating revenues. In addition, the Company is currently seeking additional sources of capital to fund short term operations. The Company, however, is dependent upon its ability to secure equity and/or debt financing and there are no assurances that the Company will be successful; therefore, without sufficient financing it would be unlikely for the Company to continue as a going concern. |
The financial statements do not include any adjustments that might result from the outcome of any uncertainty as to the Company’s ability to continue as a going concern. The financial statements also do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classifications of liabilities that might be necessary should the Company be unable to continue as a going concern. |
Related_Parties
Related Parties | 12 Months Ended |
Dec. 31, 2014 | |
Related Parties | |
Note 3 - Related Parties | Accounts Payable |
The Company owed $11,069 and $37,690 as of December 31, 2014 and 2013, respectively, to entities owned by the Chairman of the Board of Directors. The amounts are related to patent costs paid by the Chairman on behalf of the Company. | |
The Company owed $465 and $2,182 as of December 31, 2014 and 2013, respectively, to the Company’s CEO for reimbursable expenses. | |
The Company owed $13,765 and $-0- as of December 31, 2014 and 2013, respectively, to one of the Company’s Board of Directors for reimbursable expenses. | |
Notes Payable | |
From time to time, the Company has received short term loans from officers and directors as disclosed in Note 6 below. | |
Common Stock | |
On September 25, 2013, the Company sold 1,000,000 shares of its common stock to a director in exchange for proceeds of $50,000. Board of director compensation expense of $650,000 was recognized due to the fair value of the shares in excess of the $0.05 per share purchase price. | |
On February 27, 2013, the Company sold 500,000 shares of its common stock to the Chairman of the Board of Directors in exchange for proceeds of $25,000. Board of director compensation expense of $365,000 was recognized due to the fair value of the shares in excess of the $0.05 per share purchase price. | |
On February 20, 2013, the Company sold 1,000,000 shares of its common stock to a director in exchange for proceeds of $50,000. Board of director compensation expense of $780,000 was recognized due to the fair value of the shares in excess of the $0.05 per share purchase price. | |
On February 20, 2013, the Company sold 1,500,000 shares of its common stock to a director in exchange for proceeds of $75,000. Board of director compensation expense of $1,170,000 was recognized due to the fair value of the shares in excess of the $0.05 per share purchase price. | |
Common Stock Warrants | |
On November 18, 2014, the Company granted common stock warrants to the Company’s CEO to purchase a total of 1,600,000 shares of common stock at $0.25 per share for his services as an Officer. The warrants carry a vesting period of 50% on January 15, 2015, and the remaining 50% vest on June 15, 2015. The warrants are exercisable over seven (7) years. The fair value of the 1,600,000 common stock warrants using the Black-Scholes option-pricing model is $356,771, or $0.22298 per share, based on a volatility rate of 192%, a risk-free interest rate of 0.96% and an expected term of 3.54 years, and is being amortized over the implied service term, or vesting period, of the warrants. The Company recognized $73,403 and $-0- of amortization recorded to professional fee expense during the years ended December 31, 2014 and 2013, respectively. | |
On November 18, 2014, the Company granted common stock warrants to the Company’s Chairman of the Board of Directors to purchase a total of 1,600,000 shares of common stock at $0.25 per share for his services as the Chairman of the Board. The warrants carry a vesting period of 50% on January 15, 2015, and the remaining 50% vest on June 15, 2015. The warrants are exercisable over seven (7) years. The fair value of the 1,600,000 common stock warrants using the Black-Scholes option-pricing model is $356,771, or $0.22298 per share, based on a volatility rate of 192%, a risk-free interest rate of 0.96% and an expected term of 3.54 years, and is being amortized over the implied service term, or vesting period, of the warrants. The Company recognized $73,403 and $-0- of amortization recorded to professional fee expense during the years ended December 31, 2014 and 2013, respectively. | |
On November 18, 2014, the Company granted common stock warrants to one of the Directors to purchase a total of 1,400,000 shares of common stock at $0.25 per share over a seven year period from the grant date for their services as Directors. The warrants carry a vesting period of 50% on January 15, 2015, and the remaining 50% vest on June 15, 2015. The total fair value of the 1,400,000 common stock warrants using the Black-Scholes option-pricing model is $312,174, or $0.22298 per share, based on a volatility rate of 192%, a risk-free interest rate of 0.96% and an expected term of 3.54 years, and is being amortized over the implied service term, or vesting period, of the warrants. The Company recognized a total of $64,227 and $-0- of amortization recorded to professional fee expense during the years ended December 31, 2014 and 2013, respectively. | |
On November 18, 2014, the Company granted 1,200,000 common stock warrants to each of three Directors to purchase a total of 3,600,000 shares of common stock at $0.25 per share over a seven year period from the grant date for their service as Directors. The warrants carry a vesting period of 50% on January 15, 2015, and the remaining 50% vest on June 15, 2015. The total fair value of the 3,600,000 common stock warrants using the Black-Scholes option-pricing model is $802,734, or $0.22298 per share, based on a volatility rate of 192%, a risk-free interest rate of 0.96% and an expected term of 3.54 years, and is being amortized over the implied service term, or vesting period, of the warrants. The Company recognized a total of $165,156 and $-0- of amortization recorded to professional fee expense during the years ended December 31, 2014 and 2013, respectively. | |
On November 18, 2014, the Company granted common stock warrants to one of the Directors to purchase a total of 400,000 shares of common stock at $0.25 per share over a seven year period from the grant date for their services as Directors. The warrants carry a vesting period of 50% on January 15, 2015, and the remaining 50% vest on June 15, 2015. The total fair value of the 400,000 common stock warrants using the Black-Scholes option-pricing model is $89,193, or $0.22298 per share, based on a volatility rate of 192%, a risk-free interest rate of 0.96% and an expected term of 3.54 years, and is being amortized over the implied service term, or vesting period, of the warrants. The Company recognized a total of $18,351 and $-0- of amortization recorded to professional fee expense during the years ended December 31, 2014 and 2013, respectively. |
Patent_Rights_and_Applications
Patent Rights and Applications | 12 Months Ended |
Dec. 31, 2014 | |
Patent Rights And Applications | |
Note 4 - Patent Rights and Applications | The Company amortizes its patent rights and applications on a straight line basis over the expected useful technological or economic life of the patents, which is typically 17 years from the legal approval of the patent applications. As of January 1, 2013, the Company has elected to expense all of their patent rights and application costs due to difficulties associated with having to prove the value of their future economic benefits. All patent applications are currently pending and the Company has no patents that have yet been approved. It is the Company’s policy that it performs reviews of the carrying value of its patent rights and applications on an annual basis. |
Fair_Value_of_Financial_Instru
Fair Value of Financial Instruments | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Fair Value Of Financial Instruments | |||||||||||||
Note 5 - Fair Value of Financial Instruments | Under FASB ASC 820-10-5, 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 (an exit price). The standard outlines a valuation framework and creates a fair value hierarchy in order to increase the consistency and comparability of fair value measurements and the related disclosures. Under GAAP, certain assets and liabilities must be measured at fair value, and FASB ASC 820-10-50 details the disclosures that are required for items measured at fair value. | ||||||||||||
The Company has certain financial instruments that must be measured under the new fair value standard. The Company’s financial assets and liabilities are measured using inputs from the three levels of the fair value hierarchy. The three levels are as follows: | |||||||||||||
Level 1 - Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. | |||||||||||||
Level 2 - Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs). | |||||||||||||
Level 3 - Unobservable inputs that reflect our assumptions about the assumptions that market participants would use in pricing the asset or liability. | |||||||||||||
The following schedule summarizes the valuation of financial instruments at fair value on a recurring basis in the balance sheets as of December 31, 2014 and 2013, respectively: | |||||||||||||
Fair Value Measurements at December 31, 2014 | |||||||||||||
Level 1 | Level 2 | Level 3 | |||||||||||
Assets | |||||||||||||
Cash | $ | 102,599 | $ | - | $ | - | |||||||
Total assets | 102,599 | - | - | ||||||||||
Liabilities | |||||||||||||
Convertible note payable, net of discounts | - | 14,879 | - | ||||||||||
Total liabilities | - | 14,879 | - | ||||||||||
$ | 102,599 | $ | (14,879 | ) | $ | - | |||||||
Fair Value Measurements at December 31, 2013 | |||||||||||||
Level 1 | Level 2 | Level 3 | |||||||||||
Assets | |||||||||||||
Cash | $ | 15,800 | $ | - | $ | - | |||||||
Total assets | 15,800 | - | - | ||||||||||
Liabilities | |||||||||||||
Notes payable, related parties | - | 109,000 | - | ||||||||||
Total liabilities | - | 109,000 | - | ||||||||||
$ | 15,800 | $ | (109,000 | ) | $ | - | |||||||
The fair values of our related party debts are deemed to approximate book value, and are considered Level 2 inputs as defined by ASC Topic 820-10-35. | |||||||||||||
There were no transfers of financial assets or liabilities between Level 1, Level 2 and Level 3 inputs for the years ended December 31, 2014 or the year ended December 31, 2013. | |||||||||||||
Convertible_Note_Payable
Convertible Note Payable | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Convertible Note Payable | |||||||||
Note 6. Convertible Note Payable | Convertible notes payable consist of the following at December 31, 2014 and 2013, respectively: | ||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
On November 25, 2014, the Company received an unsecured loan from Typenex Co-Investment, LLC (“First Typenex Note”) in the amount of $86,500, bearing interest at 10%, maturing on August 25, 2015, in exchange for net proceeds of $75,000 after the deduction of $4,000 of loan origination costs and an original issue discount (“OID”) of $7,500. The Company also issued Typenex warrants to purchase 351,455 shares of common stock at a strike price of $0.18 per share over a five year term from the date of investment. The principal and interest is convertible into shares of common stock at the discretion of the note holder at the lesser of (i) $0.18 per share, or (ii) 70% (the “Conversion Factor”) multiplied by the Market Price (as defined in the Note). If the Market Price of our common stock falls below $0.10 per share after the issuance of the Note, the Conversion Factor will automatically be reduced by 5% for all conversions completed while the Market Price is below $0.10 per share. Notwithstanding the foregoing, so long as no Event of Default has occurred, the Conversion Price shall be not less than $0.0001 (the “Conversion Floor”). For the avoidance of doubt, upon the occurrence of an Event of Default, the Conversion Floor shall not apply to any future Conversions and shall be of no further force or effect. The note can be prepaid upon notice to Typenex any time prior to the first conversion at a premium of 120% of the then outstanding balance of the Note. The note carries a default interest rate of 22% per annum. | $ | 86,500 | $ | - | |||||
On August 13, 2013, the Company received an unsecured loan from LG Capital Funding, LLC (“LG Capital”) in the amount of $26,500, bearing interest at 8%, maturing on May 13, 2014. The principal and interest was convertible into shares of common stock at the discretion of the note holder at a price equal to fifty five percent (55%) of the average of the two (2) lowest closing bid prices of the Common Stock during the ten (10) trading day period ending one trading day prior to the date the Conversion Notice was delivered, or $0.01 per share, whichever was greater. On November 6, 2013, the Company repaid the convertible note in full with a payment of $33,788, consisting of $26,500 of principal, $530 of interest and $6,758 as a prepayment penalty. | - | - | |||||||
Total convertible notes payable | 86,500 | - | |||||||
Less unamortized debt discounts: | |||||||||
Discount on beneficial conversion feature | 32,137 | - | |||||||
Original issue discount | 6,511 | - | |||||||
Discount on warrants | 32,973 | - | |||||||
Convertible notes payable | 14,879 | - | |||||||
Less: current portion | 14,879 | - | |||||||
Convertible notes payable, less current portion | $ | - | $ | - | |||||
The Company recognized interest expense related to the convertible debts for the years ended December 31, 2014 and 2013, respectively, as follows: | |||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Accrued interest | $ | 721 | $ | 530 | |||||
Prepayment penalty | - | 6,758 | |||||||
Amortization of loan origination costs | 527 | - | |||||||
Amortization of beneficial conversion feature | 4,882 | - | |||||||
Amortization of OID | 989 | - | |||||||
Amortization of warrants | 5,008 | - | |||||||
Total interest expense | $ | 12,127 | $ | 7,288 | |||||
In addition, the Company recognized and measured the embedded beneficial conversion feature present in the convertible debts by allocating a portion of the proceeds equal to the intrinsic value of the feature to additional paid-in-capital. The intrinsic value of the feature was calculated on the commitment date using the effective conversion price of the convertible debt. This intrinsic value is limited to the portion of the proceeds allocated to the convertible debt. | |||||||||
The aforementioned accounting treatment resulted in total debt discounts equal to $37,019 and $23,236 during the years ended December 31, 2014 and 2013, respectively. The discount is amortized on a straight line basis from the dates of issuance until the earlier of the stated redemption date of the debts, as noted above or the actual settlement date. During the years ended December 31, 2014 and 2013, the Company recorded debt amortization expense in the amount of $4,882 and $23,236, respectively, attributed to the aforementioned debt discounts. | |||||||||
The convertible notes, consisting of total original face values of $86,500 from Typenex Co-Investment, LLC and $26,500 from LG Capital Funding, LLC that created the beneficial conversion features carried a default provision that placed a “maximum share amount” on the note holder that can be owned as a result of the conversions to common stock by the note holder of 4.99% of the issued and outstanding shares of the Company. | |||||||||
Typenex Co-Investment, LLC Convertible Note | |||||||||
On November 25, 2014, we entered into a Securities Purchase Agreement with Typenex Co-Investment, LLC, pursuant to which we sold to Typenex a 10% Convertible Promissory Note in the original principal amount of $86,500. The First Typenex Note had a maturity date of August 25, 2015, and was convertible into our common stock at the lesser of (i) $0.18 per share, or (ii) 70% (the “Conversion Factor”) multiplied by the Market Price (as defined in the Note). If the Market Price of our common stock falls below $0.10 per share after the issuance of the Note, the Conversion Factor will automatically be reduced by 5% for all conversions completed while the Market Price is below $0.10 per share. Notwithstanding the foregoing, so long as no Event of Default has occurred, the Conversion Price shall be not less than $0.0001 (the “Conversion Floor”). For the avoidance of doubt, upon the occurrence of an Event of Default, the Conversion Floor shall not apply to any future Conversions and shall be of no further force or effect. | |||||||||
The shares of common stock issuable upon conversion of the First Typenex Note are restricted securities as defined in Rule 144 promulgated under the Securities Act of 1933. The issuance of the First Typenex Note is exempt from the registration requirements of the Securities Act of 1933 pursuant to Rule 506 of Regulation D promulgated thereunder. The purchaser was an accredited and sophisticated investor, familiar with our operations, and there was no solicitation. | |||||||||
The Company evaluated the First Typenex Note and determined that the shares issuable pursuant to the conversion option were determinate due to the Fixed Conversion Price and, as such, does not constitute a derivative liability. The beneficial conversion feature discount resulting from the conversion price of $0.1019 below the market price on November 25, 2014 of $0.225 provided a value of $37,019, of which $4,882 and $-0- was amortized during the years ended December 31, 2014 and 2013, respectively. | |||||||||
LG Capital Funding, LLC Convertible Note | |||||||||
On August 13, 2013, we entered into a Securities Purchase Agreement with LG Capital Funding, LLC, pursuant to which we sold to LG Capital an 8% Convertible Promissory Note in the original principal amount of $26,500. The First LG Capital Note had a maturity date of May 13, 2014, and was convertible into our common stock shares of common stock at the discretion of the note holder at a price equal to fifty five percent (55%) of the average of the two (2) lowest closing bid prices of the Common Stock during the ten (10) trading day period ending one trading day prior to the date the Conversion Notice was delivered, or $0.01 per share, whichever was greater. | |||||||||
The shares of common stock issuable upon conversion of the First LG Capital Note are restricted securities as defined in Rule 144 promulgated under the Securities Act of 1933. The issuance of the First LG Capital Note was exempt from the registration requirements of the Securities Act of 1933 pursuant to Rule 506 of Regulation D promulgated thereunder. The purchaser was an accredited and sophisticated investor, familiar with our operations, and there was no solicitation. | |||||||||
The Company evaluated the First LG Capital Note and determined that the shares issuable pursuant to the conversion option were determinate due to the Fixed Conversion Price and, as such, did not constitute a derivative liability. The beneficial conversion feature discount resulting from the conversion price of $0.3737 below the market price on August 13, 2013 of $0.80 provided a value of $23,236, of which $-0- and $23,236 was amortized during the years ended December 31, 2014 and 2013, respectively. |
Notes_Payable_Related_Parties
Notes Payable, Related Parties | 12 Months Ended | ||||||||||
Dec. 31, 2014 | |||||||||||
Notes Payable Related Parties | |||||||||||
Note 7 - Notes Payable, Related Parties | Notes payable, related parties consist of the following at December 31, 2014 and 2013, respectively: | ||||||||||
December 31, | December 31, | ||||||||||
2014 | 2013 | ||||||||||
On November 18, 2013, the Company received an unsecured, 8% interest bearing loan in the amount of $50,000, due on August 18, 2014, or three business days following the receipt of one million dollars in funding, net of expenses, from the Company’s CEO. The note carries an additional prepayment premium of 35% of the principal if the note is not paid prior to maturity, and whereby the note holder is entitled to additional interest on the principal pursuant to the schedule listed below if the note is paid prior to maturity: | |||||||||||
No. of days after issuance date: | Prepayment Premium: | ||||||||||
0-30 days | 15% | ||||||||||
31-60 days | 20% | ||||||||||
61-90 days | 25% | ||||||||||
91-120 days | 30% | ||||||||||
121 days or more | 35% | ||||||||||
The note was repaid in full on March 12, 2014, in the total amount of $66,381, consisting of $50,000 of principal, $1,381 of interest and $15,000 of prepayment premium. | $ | - | $ | 50,000 | |||||||
On November 18, 2013, the Company received an unsecured, 8% interest bearing loan in the amount of $50,000, due on August 18, 2014, or three business days following the receipt of one million dollars in funding, net of expenses, from one of the Company’s Directors. The note carries an additional prepayment premium of 35% of the principal if the note is not paid prior to maturity, and whereby the note holder is entitled to additional interest on the principal pursuant to the same schedule listed above in the $50,000 note from the Company’s CEO. The note was repaid in full on March 12, 2014, in the total amount of $66,238, consisting of $50,000 of principal, $1,238 of interest and $15,000 of prepayment premium. | - | 50,000 | |||||||||
On May 4, 2012, the Company received an unsecured, non-interest bearing loan in the amount of $3,000, due on demand from the Company’s CEO. The note was repaid in full on March 7, 2014. | - | 3,000 | |||||||||
On May 4, 2012, the Company received an unsecured, non-interest bearing loan in the amount of $3,000, due on demand and a from the Company’s Chairman of the Board of Directors. The note was repaid in full on March12,2014. | - | 3,000 | |||||||||
On May 4, 2012, the Company received an unsecured, non-interest bearing loan in the amount of $3,000, due on demand from one of the Company’s directors. The loan was repaid in full on July 2, 2013. | - | - | |||||||||
On May 7, 2012, the Company received an unsecured, non-interest bearing loan in the amount of $3,000, due on demand from one of the Company’s directors. The note was repaid in full on March12,2014. | - | 3,000 | |||||||||
Total notes payable, related parties | - | 109,000 | |||||||||
Less: current portion | - | 109,000 | |||||||||
Notes payable, related parties, less current portion | $ | - | $ | - | |||||||
The Company recorded interest expense in the amount of $29,321 and $3,298 for the years ended December 31, 2014 and 2013, respectively, and imputed interest expense in the amount of $134 and $840 for the years ended December 31, 2014 and 2013, respectively related to notes payable, related parties. |
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2014 | |
Commitments And Contingencies | |
Note 8 - Commitments and Contingencies | On May 9, 2012, the Company entered into a Collaborative Agreement with the University of Texas at El Paso. Pursuant to the terms of the Agreement, the Company will work jointly with the University to develop a series of research and development programs around its sequential-dialysis technology in the areas of Alzheimer's Disease, Traumatic Brain Injury (TBI), Chronic Pain Syndrome, Fibromyalgia, Multiple Sclerosis, Amyotrophic Lateral Sclerosis (ALS or Lou Gehrig's disease), Blood Sepsis, Cancer, Heart Attacks and Strokes. The programs will utilize the facilities at one or more of the University of Texas’ campuses. The Company will pay the University’s actual overhead for the projects, plus a negotiated facility and administration overhead expense, and 10% of all gross revenues associated with the sale, license and/or royalties of all products and treatment procedures directly affiliated with programs. Intellectual property jointly invented and developed as a result of the projects will be owned jointly by the University and the Company. The agreement has an initial term of five (5) years, and is renewable upon mutual agreement of the parties. |
Equity_Line_of_Credit
Equity Line of Credit | 12 Months Ended |
Dec. 31, 2014 | |
Equity Line Of Credit | |
Note 9. Equity Line of Credit | On January 17, 2014, the Company’s registration statement became effective whereby it registered 15 million shares of common stock that it would sell to Kodiak Capital Group, LLC (“Kodiak”) over time pursuant to an Investment Agreement entered into on December 5, 2013 wherein Kodiak agreed to invest up to five million dollars ($5,000,000). The offering was to terminate on the earlier of (i) when all 15 million shares are sold, (ii) when the maximum offering amount of $5,000,000 has been achieved, or (iii) on January 17, 2016, unless the Company terminated it earlier. The investment Agreement included a termination date of July 17, 2014, but on July 9, 2014 it was extended to run through July 17, 2015. On October 16, 2014, we exercised our right to terminate the contract upon written notice to Kodiak. |
The Company could not submit a new put notice until after the closing of the previous notice. The purchase price for the shares pursuant to the put notice was to be equal to seventy-five percent (75%) of the lowest closing best bid price of the common stock during the five consecutive trading days immediately following the date of our notice to Kodiak (“Put Notice”) of our election to put shares pursuant to the Investment Agreement, subject to a limitation, whereby Kodiak’s holdings could not exceed 9.9% of the outstanding shares of common stock. The shares had to be paid for and share certificates delivered within the “pricing period,” which was five (5) trading days from the date the put notice is delivered (“Put Date”). | |
On October 15, 2013, the Company paid to Kodiak an initial fee of $10,000 and issued 391,398 shares of common stock following execution of the Agreement, along with the issuance of another 167,742 shares to Manners, Inc. as commitment fees. In addition, the Company agreed to pay a consulting firm, Cambridge Partners Atlanta Group, LLC (“Cambridge”), an introduction fee payable as follows: (i) ten percent (10%) of the first $1,000,000 in total draws, (ii) seven percent (7%) on the draws from $1,000,000 to $1,500,000; and (iii) five percent (5%) on all draws in excess of $1,500,000. Cambridge was entitled to these introduction fees on all proceeds received from Kodiak until the termination date of the consulting agreement, which was September 26, 2015 until we exercised our right to terminate the contract on October 16, 2014. | |
The Company used the proceeds from the sale of common stock pursuant to the agreement to pay down debt, research and development activities, general corporate and working capital purposes, and for other purposes that the board of directors deems to be in the best interest of the Company. | |
As of the date of this report, the Company had sold a total of 2,022,894 shares of common stock in exchange for total proceeds of $700,000 pursuant to the investment agreement, in addition to the initial issuance of 559,140 common shares as a commitment fee. |
Stockholders_Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2014 | |
Stockholders' equity (deficit): | |
Note 10 - Stockholders' Equity | Convertible Preferred Stock, Series A |
The Company has 10,000,000 authorized shares of Preferred Stock, of which 2,000,000 shares of $0.001 par value Series A Convertible Preferred Stock (“Series A Preferred Stock”) have been designated. Each share of Series A Preferred Stock is convertible, at the option of the holder thereof, at any time after the issuance of such share into one (1) fully paid and non-assessable share of Common Stock. Each outstanding share of Series A Preferred Stock is entitled to one hundred (100) votes per share on all matters to which the shareholders of the Corporation are entitled or required to vote. The Company shall reserve and keep available out of its authorized but unissued shares of Common Stock such number of shares sufficient to effect the conversions. No shares of Series A Preferred Stock have been granted to date. | |
Common Stock | |
The Company has 300,000,000 authorized shares of $0.00001 par value Common Stock. | |
Common Stock (2014) | |
On October 2, 2014, the Company sold 500,000 shares of common stock in exchange for total proceeds of $50,000. | |
On October 2, 2014, the Company sold 10,000 shares of common stock in exchange for total proceeds of $1,000. | |
On September 19, 2014, the Company granted 70,000 shares of common stock for services performed. The total fair value of the common stock was $7,959 based on the closing price of the Company’s common stock on the date of grant. The shares were subsequently issued on October 6, 2014. | |
On September 19, 2014, the Company granted 100,000 shares of common stock for services performed. The total fair value of the common stock was $11,370 based on the closing price of the Company’s common stock on the date of grant. The shares were subsequently issued on October 15, 2014. | |
On September 13, 2014, the Company granted 15,000 shares of common stock for services performed. The total fair value of the common stock was $2,250 based on the closing price of the Company’s common stock on the date of grant. | |
On September 6, 2014, the Company granted 120,000 shares of common stock for services performed. The total fair value of the common stock was $19,200 based on the closing price of the Company’s common stock on the date of grant. The shares were subsequently issued on November 3, 2014. | |
On September 6, 2014, the Company granted another 120,000 shares of common stock for services performed. The total fair value of the common stock was $19,200 based on the closing price of the Company’s common stock on the date of grant. The shares were subsequently issued on November 3, 2014. | |
On September 6, 2014, the Company granted 70,000 shares of common stock for services performed. The total fair value of the common stock was $11,200 based on the closing price of the Company’s common stock on the date of grant. The shares were subsequently issued on November 3, 2014. | |
On August 12, 2014, the Company granted 75,000 shares of common stock for services performed. The total fair value of the common stock was $12,000 based on the closing price of the Company’s common stock on the date of grant. | |
On June 19, 2014, the Company granted 100,000 shares of common stock for services performed. The total fair value of the common stock was $42,400 based on the closing price of the Company’s common stock on the date of grant. | |
On May 8, 2014, we sold 588,235 shares of our common stock to Kodiak in exchange for proceeds of $100,000 pursuant to our fifth Put Notice under our equity line of credit as delivered on April 30, 2014. | |
On April 10, 2014, we sold 211,641 shares of our common stock to Kodiak in exchange for proceeds of $100,000 pursuant to our fourth Put Notice under our equity line of credit as delivered on April 2, 2014. | |
On April 3, 2014, the Company granted 50,000 shares of common stock for services performed. The total fair value of the common stock was $40,500 based on the closing price of the Company’s common stock on the date of grant. | |
On March 19, 2014, the Company granted 100,000 shares of common stock for services performed. The total fair value of the common stock was $70,000 based on the closing price of the Company’s common stock on the date of grant. The shares were subsequently issued on April 17, 2014. | |
On March 14, 2014, we sold 181,819 shares of our common stock to Kodiak in exchange for proceeds of $100,000 pursuant to our third Put Notice under our equity line of credit as delivered on March 6, 2014. | |
On March 7, 2014, the Company granted 15,000 shares of common stock for services performed. The total fair value of the common stock was $15,000 based on the closing price of the Company’s common stock on the date of grant. | |
On February 24, 2014, we sold 374,532 shares of our common stock to Kodiak in exchange for proceeds of $250,000 pursuant to our second Put Notice under our equity line of credit as delivered on February 12, 2014. | |
On February 20, 2014, a warrant holder elected to exercise warrants consisting of 10,000 shares of its common stock pursuant to a unit offering previously sold on March 11, 2013 in exchange for proceeds of $7,500. | |
On February 12, 2014, a warrant holder elected to exercise warrants consisting of 5,000 shares of its common stock pursuant to a unit offering previously sold on February 20, 2013 in exchange for proceeds of $3,750. | |
On February 10, 2014, the Company granted 18,462 shares of common stock for services performed. The total fair value of the common stock was $12,000 based on the closing price of the Company’s common stock on the date of grant. | |
On February 3, 2014, we sold 666,667 shares of our common stock to Kodiak in exchange for proceeds of $150,000 pursuant to our first Put Notice under our equity line of credit as delivered on January 25, 2014. | |
Common Stock (2013) | |
On December 19, 2013, the Company granted 200,000 shares of common stock for services performed. The total fair value of the common stock was $140,000 based on the closing price of the Company’s common stock on the date of grant. | |
On December 17, 2013, the Company granted 150,000 shares of common stock for services performed. The total fair value of the common stock was $100,500 based on the closing price of the Company’s common stock on the date of grant. | |
On October 31, 2013, the Company granted 10,000 shares of common stock for services performed. The total fair value of the common stock was $7,400 based on the closing price of the Company’s common stock on the date of grant. | |
On October 31, 2013, the Company granted 25,000 shares of common stock for services performed. The total fair value of the common stock was $18,500 based on the closing price of the Company’s common stock on the date of grant. | |
On October 17, 2013, the Company granted 200,000 shares of common stock for services performed. The total fair value of the common stock was $140,000 based on the closing price of the Company’s common stock on the date of grant. | |
On October 15, 2013, the Company granted 391,398 shares of common stock to Kodiak Capital Group, LLC as a commitment fee for a potential future financing. The total fair value of the common stock was $246,581 based on the closing price of the Company’s common stock on the date of grant. | |
On October 15, 2013, the Company granted 167,742 shares of common stock to Manners, Inc. as a commitment fee for a potential future financing by Kodiak Capital Group, LLC. The total fair value of the common stock was $105,678 based on the closing price of the Company’s common stock on the date of grant. | |
On September 25, 2013, the Company sold 1,000,000 shares of its common stock to a director in exchange for proceeds of $50,000. Board of director compensation expense of $650,000 was recognized due to the fair value of the shares in excess of the $0.05 per share purchase price. | |
On September 25, 2013, the Company granted 300,000 shares of common stock for services performed. The total fair value of the common stock was $210,000 based on the closing price of the Company’s common stock on the date of grant. | |
On July 19, 2013, the Company issued a total of 20,000 shares of its common stock that were sold on June 27, 2013 pursuant to warrant exercises amongst seven investors in exchange for total proceeds of $2,000. | |
On July 15, 2013, the Company granted 50,000 shares of common for services performed. The total fair value of the common stock was $46,500 based on the closing price of the Company’s common stock on the date of grant. | |
On various dates between July 2, 2013 and July 25, 2013, the Company issued a total of 61,000 shares of its common stock pursuant to warrant exercises at $0.50 per share amongst eight investors in exchange for total proceeds of $30,500. | |
On various dates between July 6, 2013 and July 25, 2013, the Company issued a total of 161,200 shares of its common stock pursuant to warrant exercises at $0.10 per share amongst twenty one investors in exchange for total proceeds of $16,120. | |
On July 3, 2013, the Company issued a total of 35,000 shares of its common stock that were sold on June 21, 2013 pursuant to warrant exercises amongst seven investors in exchange for total proceeds of $3,500. | |
On June 27, 2013, two warrant holders elected to exercise warrants consisting of a total of 20,000 shares of its common stock pursuant to unit offerings previously sold on February 28, 2011 in exchange for total proceeds of $2,000. The shares were subsequently issued on July 19, 2013. | |
On June 21, 2013, a total of seven warrant holders elected to exercise warrants consisting of a total of 35,000 shares of its common stock pursuant to unit offerings previously sold on February 28, 2011 in exchange for total proceeds of $3,500. The shares were subsequently issued on July 3, 2013. | |
On March 11, 2013, a warrant holder elected to exercise warrants consisting of a 10,000 shares of its common stock pursuant to a unit offering previously sold on February 28, 2011 in exchange for proceeds of $1,000. | |
On March 11, 2013, the Company sold 10,000 shares of its common stock and an equal number of warrants exercisable at $0.75 per share over a one year term pursuant to a unit offering in exchange for proceeds of $5,000. The proceeds received were allocated between the common stock and warrants on a relative fair value basis. | |
On March 2, 2013, the Company granted 50,000 shares of common for services performed. The total fair value of the common stock was $36,450 based on the closing price of the Company’s common stock on the date of grant. | |
On February 27, 2013, the Company sold 500,000 shares of its common stock to the Chairman of the Board of Directors in exchange for proceeds of $25,000. Board of director compensation expense of $365,000 was recognized due to the fair value of the shares in excess of the $0.05 per share purchase price. | |
On February 20, 2013, the Company sold 1,000,000 shares of its common stock to a director in exchange for proceeds of $50,000. Board of director compensation expense of $780,000 was recognized due to the fair value of the shares in excess of the $0.05 per share purchase price. | |
On February 20, 2013, the Company sold 1,500,000 shares of its common stock to a director in exchange for proceeds of $75,000. Board of director compensation expense of $1,170,000 was recognized due to the fair value of the shares in excess of the $0.05 per share purchase price. | |
On February 17, 2013, the Company sold 5,000 shares of its common stock and an equal number of warrants exercisable at $0.75 per share over a one year term pursuant to a unit offering in exchange for proceeds of $2,500. The proceeds received were allocated between the common stock and warrants on a relative fair value basis. | |
On February 10, 2013, the Company sold 20,000 shares of its common stock and an equal number of warrants exercisable at $0.75 per share over a one year term pursuant to a unit offering in exchange for proceeds of $10,000. The proceeds received were allocated between the common stock and warrants on a relative fair value basis. | |
On January 30, 2013, the Company sold 60,000 shares of its common stock and an equal number of warrants exercisable at $0.75 per share over a one year term pursuant to a unit offering in exchange for proceeds of $30,000. The proceeds received were allocated between the common stock and warrants on a relative fair value basis. | |
On January 22, 2013, the Company sold 15,000 shares of its common stock and an equal number of warrants exercisable at $0.75 per share over a one year term pursuant to a unit offering in exchange for proceeds of $7,500. The proceeds received were allocated between the common stock and warrants on a relative fair value basis. | |
On January 9, 2013, the Company issued 40,000 shares of its common stock that were sold on December 31, 2012 pursuant to a unit offering in exchange for proceeds of $20,000 that were presented as a subscriptions payable at December 31, 2012. | |
Beneficial Conversion Feature | |
On November 25, 2014, the Company entered into a convertible promissory note with Typenex Co-Investments, LLC. The beneficial conversion feature discount resulting from the conversion price that was $0.1019 below the market price of $0.225 on the November 25, 2014 origination date resulted in a debt discount value of $37,019 that was recognized as additional paid in capital and was amortized on a straight line basis over the life of the loan. | |
On August 13, 2013, the Company entered into a convertible promissory note with LG Capital Funding, LLC. The beneficial conversion feature discount resulting from the conversion price that was $0.3737 below the market price of $0.80 on the August 13, 2013 origination date resulted in a debt discount value of $23,236 that was recognized as additional paid in capital and was amortized on a straight line basis over the life of the loan, which was accelerated upon the repayment prior to maturity on November 6, 2013. |
Series_A_Convertible_Preferred
Series A Convertible Preferred Stock Warrants | 12 Months Ended | ||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||
Series Convertible Preferred Stock Warrants | |||||||||||||||||||
Note 11 - Series A Convertible Preferred Stock Warrants | Series A Convertible Preferred Stock Warrants Granted | ||||||||||||||||||
No series A preferred stock warrants were cancelled during the years ended December 31, 2014 and 2013. | |||||||||||||||||||
Series A Preferred Stock Warrants Cancelled | |||||||||||||||||||
No series A preferred stock warrants were cancelled during the years ended December 31, 2014 and 2013. | |||||||||||||||||||
Series A Preferred Stock Warrants Expired | |||||||||||||||||||
No series A preferred stock warrants were expired during the years ended December 31, 2014 and 2013. | |||||||||||||||||||
Series A Preferred Stock Warrants Exercised | |||||||||||||||||||
No series A preferred stock warrants were exercised during the years ended December 31, 2014 and 2013. | |||||||||||||||||||
The following is a summary of information about the Series A Preferred Stock Warrants outstanding at December 31, 2014. | |||||||||||||||||||
Shares Underlying | |||||||||||||||||||
Shares Underlying Warrants Outstanding | Warrants Exercisable | ||||||||||||||||||
Weighted | |||||||||||||||||||
Shares | Average | Weighted | Shares | Weighted | |||||||||||||||
Range of | Underlying | Remaining | Average | Underlying | Average | ||||||||||||||
Exercise | Warrants | Contractual | Exercise | Warrants | Exercise | ||||||||||||||
Prices | Outstanding | Life | Price | Exercisable | Price | ||||||||||||||
$ | 0.001 | 2,000,000 | 5.5 years | $ | 0.001 | 2,000,000 | $ | 0.001 | |||||||||||
The fair value of each warrant grant is estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions used for grants under the fixed option plan: | |||||||||||||||||||
December 31, | December 31, | ||||||||||||||||||
2014 | 2013 | ||||||||||||||||||
Average risk-free interest rates | N/A | N/A | |||||||||||||||||
Average expected life (in years) | N/A | N/A | |||||||||||||||||
The Black-Scholes option pricing model was developed for use in estimating the fair value of short-term traded options that have no vesting restrictions and are fully transferable. In addition, option valuation models require the input of highly subjective assumptions including expected stock price volatility. Because the Company’s series A preferred stock warrants have characteristics significantly different from those of traded options and because changes in the subjective input assumptions can materially affect the fair value estimate, in management’s opinion the existing models do not necessarily provide a reliable single measure of the fair value of its series A preferred stock warrants. During the years ended December 31, 2014 and 2013 there were no warrants granted with an exercise price below the fair value of the underlying stock at the grant date. | |||||||||||||||||||
There were no series A preferred stock warrants granted during the years ended December 31, 2014 and 2013. | |||||||||||||||||||
The following is a summary of activity of outstanding series A preferred stock warrants: | |||||||||||||||||||
Weighted | |||||||||||||||||||
Average | |||||||||||||||||||
Number of | Exercise | ||||||||||||||||||
Shares | Price | ||||||||||||||||||
Balance, December 31, 2012 | 2,000,000 | $ | 0.001 | ||||||||||||||||
Warrants cancelled | - | - | |||||||||||||||||
Warrants granted | - | - | |||||||||||||||||
Warrants exercised | - | - | |||||||||||||||||
Balance, December 31, 2013 | 2,000,000 | $ | 0.001 | ||||||||||||||||
Warrants cancelled | - | - | |||||||||||||||||
Warrants granted | - | - | |||||||||||||||||
Warrants exercised | - | - | |||||||||||||||||
Balance, December 31, 2014 | 2,000,000 | $ | 0.001 | ||||||||||||||||
Exercisable, December 31, 2014 | 2,000,000 | $ | 0.001 |
Common_Stock_Warrants
Common Stock Warrants | 12 Months Ended | ||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||
Common Stock Warrants | |||||||||||||||||||
Note 12 - Common Stock Warrants | Common Stock Warrants Granted (2014) | ||||||||||||||||||
On November 25, 2014, the Company issued warrants to purchase 351,455 shares of common stock, exercisable at $0.18 per share over a five (5) year period pursuant to a convertible debenture offering in exchange for net proceeds of $75,000 with an $86,500 face value. The fair value of the 351,455 common stock warrants using the Black-Scholes option-pricing model is $76,950, or $0.21895 per share based on a volatility rate of 193%, a risk-free interest rate of 1.58% and an expected term of 5 years. The proceeds received were allocated between the debt and warrants on a relative fair value basis, resulting in a debt discount of $37,981, which is being amortized over the life of the loan. The Company recognized $5,008 and $-0- of amortization recorded to interest expense during the years ended December 31, 2014 and 2013, respectively. | |||||||||||||||||||
On November 18, 2014, the Company granted common stock warrants to the Company’s CEO to purchase a total of 1,600,000 shares of common stock at $0.25 per share for his services as an Officer. The warrants carry a vesting period of 50% on January 15, 2015, and the remaining 50% vest on June 15, 2015. The warrants are exercisable over seven (7) years. The fair value of the 1,600,000 common stock warrants using the Black-Scholes option-pricing model is $356,771, or $0.22298 per share, based on a volatility rate of 192%, a risk-free interest rate of 0.96% and an expected term of 3.54 years, and is being amortized over the implied service term, or vesting period, of the warrants. The Company recognized $73,403 and $-0- of amortization recorded to professional fee expense during the years ended December 31, 2014 and 2013, respectively. | |||||||||||||||||||
On November 18, 2014, the Company granted common stock warrants to the Company’s Chairman of the Board of Directors to purchase a total of 1,600,000 shares of common stock at $0.25 per share for his services as the Chairman of the Board. The warrants carry a vesting period of 50% on January 15, 2015, and the remaining 50% vest on June 15, 2015. The warrants are exercisable over seven (7) years. The fair value of the 1,600,000 common stock warrants using the Black-Scholes option-pricing model is $356,771, or $0.22298 per share, based on a volatility rate of 192%, a risk-free interest rate of 0.96% and an expected term of 3.54 years, and is being amortized over the implied service term, or vesting period, of the warrants. The Company recognized $73,403 and $-0- of amortization recorded to professional fee expense during the years ended December 31, 2014 and 2013, respectively. | |||||||||||||||||||
On November 18, 2014, the Company granted common stock warrants to one of the Directors to purchase a total of 1,400,000 shares of common stock at $0.25 per share over a seven year period from the grant date for their services as Directors. The warrants carry a vesting period of 50% on January 15, 2015, and the remaining 50% vest on June 15, 2015. The total fair value of the 1,400,000 common stock warrants using the Black-Scholes option-pricing model is $312,174, or $0.22298 per share, based on a volatility rate of 192%, a risk-free interest rate of 0.96% and an expected term of 3.54 years, and is being amortized over the implied service term, or vesting period, of the warrants. The Company recognized a total of $64,227 and $-0- of amortization recorded to professional fee expense during the years ended December 31, 2014 and 2013, respectively. | |||||||||||||||||||
On November 18, 2014, the Company granted 1,200,000 common stock warrants to each of three Directors to purchase a total of 3,600,000 shares of common stock at $0.25 per share over a seven year period from the grant date for their service as Directors. The warrants carry a vesting period of 50% on January 15, 2015, and the remaining 50% vest on June 15, 2015. The total fair value of the 3,600,000 common stock warrants using the Black-Scholes option-pricing model is $802,734, or $0.22298 per share, based on a volatility rate of 192%, a risk-free interest rate of 0.96% and an expected term of 3.54 years, and is being amortized over the implied service term, or vesting period, of the warrants. The Company recognized a total of $165,156 and $-0- of amortization recorded to professional fee expense during the years ended December 31, 2014 and 2013, respectively. | |||||||||||||||||||
On November 18, 2014, the Company granted common stock warrants to one of the Directors to purchase a total of 400,000 shares of common stock at $0.25 per share over a seven year period from the grant date for their services as Directors. The warrants carry a vesting period of 50% on January 15, 2015, and the remaining 50% vest on June 15, 2015. The total fair value of the 400,000 common stock warrants using the Black-Scholes option-pricing model is $89,193, or $0.22298 per share, based on a volatility rate of 192%, a risk-free interest rate of 0.96% and an expected term of 3.54 years, and is being amortized over the implied service term, or vesting period, of the warrants. The Company recognized a total of $18,351 and $-0- of amortization recorded to professional fee expense during the years ended December 31, 2014 and 2013, respectively. | |||||||||||||||||||
On November 18, 2014, the Company granted 700,000 common stock warrants to each of three new advisors to purchase a total of 2,100,000 shares of common stock at $0.25 per share for services provided. The warrants carry a vesting period of 50% on January 15, 2015, and the remaining 50% vest on June 15, 2015. The warrants are exercisable over seven (7) years. In accordance with Accounting Standards Codification (“ASC”) 505-50, non-employee stock based compensation awards are re-measured at each period. The total fair value of the 2,100,000 common stock warrants using the Black-Scholes option-pricing model is $228,516, or $0.1088 per share as of December 31, 2014, based on a volatility rate of 201%, a risk-free interest rate of 1.97% and an expected term of 7 years. The Company recognized a total of $47,016 and $-0- of professional fee expense during the years ended December 31, 2014 and 2013, respectively. | |||||||||||||||||||
Amendment of Common Stock Warrants (2013) | |||||||||||||||||||
On June 28, 2013, the Company extended a total of 190,289 previously granted common stock warrants issued amongst a total of ten former investors, with an exercise price of $0.50 for approximately an additional 25 days from their expiration. All other terms remained the same as originally issued. These modified warrants are fully vested and expired on July 23, 2013. The total estimated value using the Black-Scholes Pricing Model, based on a volatility rate of 32% and a call option value of $0.4200, was $79,923. The value immediately preceding the modification was $-0- due to their expiration. As a result, the entire $79,923 was recognized as a deemed dividend on June 28, 2013. | |||||||||||||||||||
Common Stock Warrants Granted (2013) | |||||||||||||||||||
On December 12, 2013, the Company granted common stock warrants to an independent contractor to purchase a total of 50,000 shares of common stock at $0.25 per share for consulting services. The warrants are exercisable over two (2) years from December 12, 2013. In accordance with Accounting Standards Codification (“ASC”) 505-50, non-employee stock based compensation awards are re-measured at each period. The fair value of the 50,000 common stock warrants using the Black-Scholes option-pricing model is $21,736, or $0.4347 per share as of December 31, 2013, based on a volatility rate of 104%, a risk-free interest rate of 0.34% and an expected term of 2 years, and was expensed as professional fee expense during the year ended December 31, 2013. | |||||||||||||||||||
On September 25, 2013, the Company granted common stock warrants to an independent contractor to purchase a total of 300,000 shares of common stock at $0.96 per share for consulting services. The warrants vest monthly in 50,000 increments over six months commencing on October 1, 2013. The warrants are exercisable over three (3) years from October 1, 2013. In accordance with Accounting Standards Codification (“ASC”) 505-50, non-employee stock based compensation awards are re-measured at each period. The fair value of the 300,000 common stock warrants using the Black-Scholes option-pricing model is $134,709, or $0.4490 per share as of December 31, 2013, based on a volatility rate of 105%, a risk-free interest rate of 1.75% and an expected term of 3 years. A total of $74,314 was expensed as professional fee expense during the year ended December 31, 2013. | |||||||||||||||||||
On March 11, 2013, the Company sold warrants to purchase 10,000 shares of common stock at $0.75 per share over a one year period from the date of sale, in exchange for total proceeds of $5,000 in conjunction with the sale of 10,000 shares of common stock. The proceeds received were allocated between the common stock and warrants on a relative fair value basis. | |||||||||||||||||||
On February 20, 2013, the Company sold warrants to purchase 5,000 shares of common stock at $0.75 per share over a one year period from the date of sale, in exchange for total proceeds of $2,500 in conjunction with the sale of 5,000 shares of common stock. The proceeds received were allocated between the common stock and warrants on a relative fair value basis. | |||||||||||||||||||
On February 20, 2013, the Company sold warrants to purchase 20,000 shares of common stock at $0.75 per share over a one year period from the date of sale, in exchange for total proceeds of $10,000 in conjunction with the sale of 20,000 shares of common stock. The proceeds received were allocated between the common stock and warrants on a relative fair value basis. | |||||||||||||||||||
On February 14, 2013, the Company sold warrants to purchase 60,000 shares of common stock at $0.75 per share over a one year period from the date of sale, in exchange for total proceeds of $30,000 in conjunction with the sale of 60,000 shares of common stock. The proceeds received were allocated between the common stock and warrants on a relative fair value basis. | |||||||||||||||||||
On January 30, 2013, the Company sold warrants to purchase 15,000 shares of common stock at $0.75 per share over a one year period from the date of sale, in exchange for total proceeds of $7,500 in conjunction with the sale of 15,000 shares of common stock. The proceeds received were allocated between the common stock and warrants on a relative fair value basis. | |||||||||||||||||||
Common Stock Warrants Cancelled | |||||||||||||||||||
No warrants were cancelled during the years ended December 31, 2014 and 2013. | |||||||||||||||||||
Common Stock Warrants Expired | |||||||||||||||||||
A total of 95,000 and 209,289 warrants expired during years ended December 31, 2014 and 2013, respectively. | |||||||||||||||||||
Common Stock Warrants Exercised (2014) | |||||||||||||||||||
On February 20, 2014, a warrant holder elected to exercise warrants consisting of a total of 10,000 shares of its common stock pursuant to a unit offering previously sold on March 11, 2013, in exchange for total proceeds of $7,500. | |||||||||||||||||||
On February 12, 2014, a warrant holder elected to exercise warrants consisting of a total of 5,000 shares of its common stock pursuant to a unit offering previously sold on February 20, 2013 in exchange for total proceeds of $3,750. | |||||||||||||||||||
Common Stock Warrants Exercised (2013) | |||||||||||||||||||
On various dates between July 2, 2013 and July 25, 2013, the Company issued a total of 61,000 shares of its common stock pursuant to warrant exercises at $0.50 per share amongst eight investors in exchange for total proceeds of $30,500. | |||||||||||||||||||
On various dates between July 6, 2013 and July 25, 2013, the Company issued a total of 161,200 shares of its common stock pursuant to warrant exercises at $0.10 per share amongst twenty one investors in exchange for total proceeds of $16,120. | |||||||||||||||||||
On June 27, 2013, two warrant holders elected to exercise warrants consisting of a total of 20,000 shares of its common stock pursuant to unit offerings previously sold on February 28, 2011 in exchange for total proceeds of $2,000. The shares were subsequently issued on July 19, 2013, as such, the proceeds were presented as a subscriptions payable at June 30, 2013. | |||||||||||||||||||
On June 21, 2013, a total of seven warrant holders elected to exercise warrants consisting of a total of 35,000 shares of its common stock pursuant to unit offerings previously sold on February 28, 2011 in exchange for total proceeds of $3,500. The shares were subsequently issued on July 3, 2013, as such, the proceeds were presented as a subscriptions payable at June 30, 2013. | |||||||||||||||||||
On March 11, 2013, there were 10,000 common stock warrants exercised in exchange for proceeds of $1,000. | |||||||||||||||||||
The following is a summary of information about the Common Stock Warrants outstanding at December 31, 2014. | |||||||||||||||||||
Shares Underlying | |||||||||||||||||||
Shares Underlying Warrants Outstanding | Warrants Exercisable | ||||||||||||||||||
Weighted | |||||||||||||||||||
Shares | Average | Weighted | Shares | Weighted | |||||||||||||||
Range of | Underlying | Remaining | Average | Underlying | Average | ||||||||||||||
Exercise | Warrants | Contractual | Exercise | Warrants | Exercise | ||||||||||||||
Prices | Outstanding | Life | Price | Exercisable | Price | ||||||||||||||
$ | 0.00001 – $1.45 | 50,591,455 | 5.7 years | $ | 0.14434 | 39,891,455 | $ | 0.116 | |||||||||||
The fair value of each warrant grant is estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions used for grants under the fixed option plan: | |||||||||||||||||||
December 31, | December 31, | ||||||||||||||||||
2014 | 2013 | ||||||||||||||||||
Average risk-free interest rates | 1.18 | % | 2.8 | % | |||||||||||||||
Average expected life (in years) | 4.24 | 1.4 | |||||||||||||||||
The Black-Scholes option pricing model was developed for use in estimating the fair value of short-term traded options that have no vesting restrictions and are fully transferable. In addition, option valuation models require the input of highly subjective assumptions including expected stock price volatility. Because the Company’s common stock warrants have characteristics significantly different from those of traded options and because changes in the subjective input assumptions can materially affect the fair value estimate, in management’s opinion the existing models do not necessarily provide a reliable single measure of the fair value of its common stock warrants. During the years ended December 31, 2014 and 2013 there were no warrants granted with an exercise price below the fair value of the underlying stock at the grant date. | |||||||||||||||||||
The weighted average fair value of warrants granted with exercise prices at the current fair value of the underlying stock was approximately $0.2256 and $0.4084 per warrant granted during the years ended December 31, 2014 and 2013, respectively. | |||||||||||||||||||
The following is a summary of activity of outstanding common stock warrants: | |||||||||||||||||||
Weighted | |||||||||||||||||||
Average | |||||||||||||||||||
Number of | Exercise | ||||||||||||||||||
Shares | Price | ||||||||||||||||||
Balance, December 31, 2012 | 39,686,489 | $ | 0.1114 | ||||||||||||||||
Warrants cancelled | (209,289 | ) | (0.4962 | ) | |||||||||||||||
Warrants granted | 460,000 | 0.8326 | |||||||||||||||||
Warrants exercised | (287,200 | ) | (0.1850 | ) | |||||||||||||||
Balance, December 31, 2013 | 39,650,000 | $ | 0.1172 | ||||||||||||||||
Warrants cancelled | (95,000 | ) | (0.75 | ) | |||||||||||||||
Warrants granted | 11,051,455 | 0.2477 | |||||||||||||||||
Warrants exercised | (15,000 | ) | (0.75 | ) | |||||||||||||||
Balance, December 31, 2014 | 50,591,455 | $ | 0.1443 | ||||||||||||||||
Exercisable, December 31, 2014 | 39,891,455 | $ | 0.116 |
Income_Taxes
Income Taxes | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Income Taxes | |||||||||
Note 13 - Income Taxes | The Company accounts for income taxes under FASB ASC 740-10, which requires use of the liability method. FASB ASC 740-10-25 provides that deferred tax assets and liabilities are recorded based on the differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes, referred to as temporary differences. | ||||||||
For the years ended December 31, 2014 and 2013, the Company incurred a net operating loss and, accordingly, no provision for income taxes has been recorded. In addition, no benefit for income taxes has been recorded due to the uncertainty of the realization of any tax assets. At December 31, 2014 and December 31, 2013, the Company had approximately $1,930,314 and $1,306,637 of federal net operating losses, respectively. The net operating loss carry forwards, if not utilized, will begin to expire in 2031. | |||||||||
The components of the Company’s deferred tax asset are as follows: | |||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Deferred tax assets: | |||||||||
Net operating loss carry forwards | $ | 675,610 | $ | 457,320 | |||||
Net deferred tax assets before valuation allowance | $ | 675,610 | $ | 457,320 | |||||
Less: Valuation allowance | (675,610 | ) | (457,320 | ) | |||||
Net deferred tax assets | $ | - | $ | - | |||||
Based on the available objective evidence, including the Company’s history of losses, management believes it is more likely than not that the net deferred tax assets will not be fully realizable. Accordingly, the Company provided for a full valuation allowance against its net deferred tax assets at December 31, 2014 and 2013, respectively. | |||||||||
A reconciliation between the amounts of income tax benefit determined by applying the applicable U.S. and State statutory income tax rate to pre-tax loss is as follows: | |||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Federal and state statutory rate | 35 | % | 35 | % | |||||
Change in valuation allowance on deferred tax assets | (35 | %) | (35 | %) | |||||
In accordance with FASB ASC 740, the Company has evaluated its tax positions and determined there are no uncertain tax positions. |
Subsequent_Events
Subsequent Events | 12 Months Ended | ||
Dec. 31, 2014 | |||
Subsequent Events | |||
Note 14 - Subsequent Events | Patent License Agreement | ||
On March 4, 2015, we entered into a Patent License Agreement (PLA) with the University of Texas at El Paso (UTEP) regarding our joint research and development of CTLA-4 Blockade with Metronomic Chemotherapy for the Treatment of Breast Cancer. This is the first PLA with UTEP following our Collaborative Agreement with them dated May 9, 2012, and memorializes the joint ownership of the applicable patent and the financial and other terms related thereto. | |||
Convertible Debts | |||
On March 4, 2015, we entered into an Amendment to the First Typenex Note dated November 25, 2014 that revised the conversion terms to provide that, so long as no Event of Default (as defined in the Note) has occurred, the Conversion Price shall be not less than $0.0001 (the “Conversion Floor”) and that, upon the occurrence of an Event of Default, the Conversion Floor shall not apply to any future Conversions and shall be of no further force or effect. | |||
On February 24, 2015, we entered into a Securities Purchase Agreement with Adar Bays, LLC (“Adar Bays”), pursuant to which we sold to Adar Bays an 8% Convertible Promissory Note in the original principal amount of $44,100.00 (the “First Adar Note”). The Note has a maturity date of February 24, 2016, and is convertible after 180 days into our common stock at the higher of (i) $0.001 cents per share or (ii) 70% of the average of the two (2) lowest closing prices of our common stock for the fifteen (15) trading days prior to receipt of a conversion notice from Adar Bays. The shares of common stock issuable upon conversion of the Note will be restricted securities as defined in Rule 144 promulgated under the Securities Act of 1933. The Note can be prepaid by us at a premium as follows: (a) between 1 and 30 days after issuance – 115% of the principal amount; (b) between 31 and 60 days after issuance – 121% of the principal amount; (c) between 61 and 90 days after issuance – 127% of the principal amount; (d) between 91 and 120 days after issuance – 133% of the principal amount; (e) between 121 and 150 days after issuance – 139% of the principal amount; and (f) between 151 and 180 days after issuance – 140% of the principal amount. There is no right to pre-payment after 180 days. The purchase and sale of the Note closed on March 2, 2015, the date that the purchase price was delivered to us. | |||
On January 30, 2015, we entered into a Securities Purchase Agreement with LG Capital Funding, LLC (“LG Capital”), pursuant to which we sold to LG Capital a 8% Convertible Promissory Note in the original principal amount of $82,687.00 (the “ Second LG Note”). The Note has a maturity date of January 29, 2016, and is convertible after 180 days into our common stock at the higher of (i) $0.001 cents per share or (ii) 70% of the average of the two (2) lowest closing bid prices of our common stock for the fifteen (15) trading days prior to receipt of a conversion notice from LG Capital. The shares of common stock issuable upon conversion of the Note will be restricted securities as defined in Rule 144 promulgated under the Securities Act of 1933. The Note can be prepaid by us at a premium as follows: (a) between 1 and 30 days after issuance – 115% of the principal amount; (b) between 31 and 60 days after issuance – 121% of the principal amount; (c) between 61 and 90 days after issuance – 126% of the principal amount; (d) between 91 and 120 days after issuance – 132% of the principal amount; (e) between 121 and 150 days after issuance – 138% of the principal amount; and (f) between 151 and 180 days after issuance – 140% of the principal amount. There is no right to pre-payment after 180 days. The purchase and sale of the Note closed on January 30, 2015, the date that the purchase price was delivered to us. | |||
Warrant Issuances | |||
On March 20, 2015, the Company granted cashless common stock warrants to an independent contractor to purchase a total of 500,000 shares of common stock at $0.20 per share for investor relation services. The warrants are exercisable over five (5) years from March 20, 2015. The warrants vest in accordance with the schedule presented below, whereby the price per share is defined by the closing bid price over three consecutive trading days: | |||
· | 125,000 warrants will vest at $0.20 per share | ||
· | 125,000 warrants will vest at $0.30 per share | ||
· | 125,000 warrants will vest at $0.40 per share | ||
· | 125,000 warrants will vest at $0.50 per share |
Nature_of_Business_and_Signifi1
Nature of Business and Significant Accounting Policies (Policies) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Nature Of Business And Significant Accounting Policies Policies | |||||||||
Nature of Business | Premier Biomedical, Inc. (“the Company”) was incorporated in the State of Nevada on May 10, 2010 (“Inception”). The Company was formed to develop and market medications and procedures that address a significant number of the most highly visible health issues currently affecting mankind. The Company will market these medications and procedures to leading worldwide pharmaceutical firms via publication in medical journals and by direct contact. | ||||||||
These statements reflect all adjustments, consisting of normal recurring adjustments, which in the opinion of management are necessary for fair presentation of the information contained therein. | |||||||||
JOBS Act | We are an “emerging growth company” as defined in the recently-enacted JOBS Act, and we are eligible to take advantage of certain exemptions from various reporting and disclosure requirements that are applicable to public companies that are not “emerging growth companies.” As an “emerging growth company” under the JOBS Act, we are permitted to, and intend to, rely on exemptions from certain reporting and disclosure requirements, which may make our future public filings different than that of other public companies. | ||||||||
Section 107 of the JOBS Act provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an “emerging growth company” can delay the adoption of certain new accounting standards until those standards would otherwise apply to private companies. We have elected to use the extended transition period for complying with new or revised accounting standards under Section 102(b)(2) of the JOBS Act, that allows us to delay the adoption of new or revised accounting standards that have different effective dates for public and private companies until those standards apply to private companies. As a result of this election, our financial statements may not be comparable to companies that comply with public company effective dates. | |||||||||
We will remain an “emerging growth company” until the earliest of: (i) the last day of the fiscal year during which we had total annual gross revenues of $1 billion or more, (ii) the last day of the fiscal year following the fifth anniversary of the date of the first sale of our common stock pursuant to an effective registration statement, (iii) the date on which we have, during the previous 3-year period, issued more than $1 billion in non-convertible debt or (iv) the date on which we are deemed a “large accelerated filer” as defined under the federal securities laws. | |||||||||
Use of Estimates | The preparation of financial statements in conformity with accounting principles generally accepted in the United States 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 the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. | ||||||||
Cash and Cash Equivalents | We maintain cash balances in non-interest-bearing accounts, which do not currently exceed federally insured limits. For the purpose of the statements of cash flows, all highly liquid investments with an original maturity of three months or less are considered to be cash equivalents. | ||||||||
Patent rights and applications | Patent rights and applications costs include the acquisition costs and costs incurred for the filing of patents. Patent rights and applications are amortized on a straight-line basis over the legal life of the patent rights beginning at the time the patents are approved. Patent costs for unsuccessful patent applications are expensed when the application is terminated. | ||||||||
Fair Value of Financial Instruments | Under FASB ASC 820-10-05, the Financial Accounting Standards Board establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosures about fair value measurements. This Statement reaffirms that fair value is the relevant measurement attribute. The adoption of this standard did not have a material effect on the Company’s financial statements as reflected herein. The carrying amounts of cash, prepaid expenses and accrued expenses reported on the balance sheet are estimated by management to approximate fair value primarily due to the short term nature of the instruments. | ||||||||
Basic and Diluted Loss Per Share | The basic net loss per common share is computed by dividing the net loss by the weighted average number of common shares outstanding. Diluted net loss per common share is computed by dividing the net loss adjusted on an “as if converted” basis, by the weighted average number of common shares outstanding plus potential dilutive securities. For the periods presented, potential dilutive securities had an anti-dilutive effect and were not included in the calculation of diluted net loss per common share. | ||||||||
Stock-Based Compensation | Under FASB ASC 718-10-30-2, all share-based payments to employees, including grants of employee stock options, to be recognized in the income statement based on their fair values. Pro forma disclosure is no longer an alternative. The Company’s stock based compensation consisted of the following during the years ended December 31, 2014 and 2013, respectively: | ||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Common stock issued for services | $ | 263,079 | $ | 1,051,609 | |||||
Common stock issued for services, related parties | - | 2,965,000 | |||||||
Warrants issued for services | 96,767 | 96,050 | |||||||
Warrants issued for services, related parties | 394,540 | 259,044 | |||||||
Total stock based compensation | $ | 754,386 | $ | 4,371,703 | |||||
Revenue Recognition | Sales on fixed price contracts are recorded when services are earned, the earnings process is complete or substantially complete, and the revenue is measurable and collectability is reasonably assured. Provisions for discounts and rebates to customers, estimated returns and allowances, and other adjustments are provided for in the same period the related sales are recorded. The Company defers any revenue from sales in which payment has been received, but the earnings process has not occurred. Sales have not yet commenced. | ||||||||
Advertising and Promotion | All costs associated with advertising and promoting products are expensed as incurred. These expenses were $159,411 and $25,507 for the years ended December 31, 2014 and 2013, respectively. | ||||||||
Income Taxes | Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. A valuation allowance is provided for significant deferred tax assets when it is more likely than not, that such asset will not be recovered through future operations. | ||||||||
Uncertain Tax Positions | In accordance with ASC 740, “Income Taxes” (“ASC 740”), the Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be capable of withstanding examination by the taxing authorities based on the technical merits of the position. These standards prescribe a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. These standards also provide guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. | ||||||||
Various taxing authorities periodically audit the Company’s income tax returns. These audits include questions regarding the Company’s tax filing positions, including the timing and amount of deductions and the allocation of income to various tax jurisdictions. In evaluating the exposures connected with these various tax filing positions, including state and local taxes, the Company records allowances for probable exposures. A number of years may elapse before a particular matter, for which an allowance has been established, is audited and fully resolved. The Company has not yet undergone an examination by any taxing authorities. | |||||||||
The assessment of the Company’s tax position relies on the judgment of management to estimate the exposures associated with the Company’s various filing positions. | |||||||||
Recent Accounting Pronouncements | In June 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-12, Compensation – Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period. The new guidance requires that share-based compensation that require a specific performance target to be achieved in order for employees to become eligible to vest in the awards and that could be achieved after an employee completes the requisite service period be treated as a performance condition. As such, the performance target should not be reflected in estimating the grant-date fair value of the award. Compensation costs should be recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable to the period(s) for which the requisite service has already been rendered. If the performance target becomes probable of being achieved before the end of the requisite service period, the remaining unrecognized compensation cost should be recognized prospectively over the remaining requisite service period. The total amount of compensation cost recognized during and after the requisite service period should reflect the number of awards that are expected to vest and should be adjusted to reflect those awards that ultimately vest. The requisite service period ends when the employee can cease rendering service and still be eligible to vest in the award if the performance target is achieved. This new guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2015. Early adoption is permitted. Entities may apply the amendments in this Update either (a) prospectively to all awards granted or modified after the effective date or (b) retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. The adoption of ASU 2014-12 is not expected to have a material impact on our financial position or results of operations. | ||||||||
In June 2014, the FASB issued ASU No. 2014-10: Development Stage Entities (Topic 915): Elimination of Certain Financial Reporting Requirements, Including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation, to improve financial reporting by reducing the cost and complexity associated with the incremental reporting requirements of development stage entities. The amendments in this update remove all incremental financial reporting requirements from U.S. GAAP for development stage entities, thereby improving financial reporting by eliminating the cost and complexity associated with providing that information. The amendments in this Update also eliminate an exception provided to development stage entities in Topic 810, Consolidation, for determining whether an entity is a variable interest entity on the basis of the amount of investment equity that is at risk. The amendments to eliminate that exception simplify U.S. GAAP by reducing avoidable complexity in existing accounting literature and improve the relevance of information provided to financial statement users by requiring the application of the same consolidation guidance by all reporting entities. The elimination of the exception may change the consolidation analysis, consolidation decision, and disclosure requirements for a reporting entity that has an interest in an entity in the development stage. The amendments related to the elimination of inception-to-date information and the other remaining disclosure requirements of Topic 915 should be applied retrospectively except for the clarification to Topic 275, which shall be applied prospectively. For public companies, those amendments are effective for annual reporting periods beginning after December 15, 2014, and interim periods therein. Early adoption is permitted. The adoption of ASU 2014-10 is not expected to have a material impact on our financial position or results of operations. | |||||||||
In July 2013, the FASB issued ASU No. 2013-11: Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists.The new guidance requires that unrecognized tax benefits be presented on a net basis with the deferred tax assets for such carryforwards. This new guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2013. We do not expect the adoption of the new provisions to have a material impact on our financial condition or results of operations. |
Nature_of_Business_and_Signifi2
Nature of Business and Significant Accounting Policies (Table) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Nature Of Business And Significant Accounting Policies Table | |||||||||
Stock-Based Compensation | December 31, | December 31, | |||||||
2014 | 2013 | ||||||||
Common stock issued for services | $ | 263,079 | $ | 1,051,609 | |||||
Common stock issued for services, related parties | - | 2,965,000 | |||||||
Warrants issued for services | 96,767 | 96,050 | |||||||
Warrants issued for services, related parties | 394,540 | 259,044 | |||||||
Total stock based compensation | $ | 754,386 | $ | 4,371,703 |
Fair_Value_of_Financial_Instru1
Fair Value of Financial Instruments (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Fair Value Of Financial Instruments Tables | |||||||||||||
Fair Value of Financial Instruments | The following schedule summarizes the valuation of financial instruments at fair value on a recurring basis in the balance sheets as of December 31, 2014 and 2013, respectively: | ||||||||||||
Fair Value Measurements at December 31, 2014 | |||||||||||||
Level 1 | Level 2 | Level 3 | |||||||||||
Assets | |||||||||||||
Cash | $ | 102,599 | $ | - | $ | - | |||||||
Total assets | 102,599 | - | - | ||||||||||
Liabilities | |||||||||||||
Convertible note payable, net of discounts | - | 14,879 | - | ||||||||||
Total liabilities | - | 14,879 | - | ||||||||||
$ | 102,599 | $ | (14,879 | ) | $ | - | |||||||
Fair Value Measurements at December 31, 2013 | |||||||||||||
Level 1 | Level 2 | Level 3 | |||||||||||
Assets | |||||||||||||
Cash | $ | 15,800 | $ | - | $ | - | |||||||
Total assets | 15,800 | - | - | ||||||||||
Liabilities | |||||||||||||
Notes payable, related parties | - | 109,000 | - | ||||||||||
Total liabilities | - | 109,000 | - | ||||||||||
$ | 15,800 | $ | (109,000 | ) | $ | - |
Convertible_Note_Payable_Table
Convertible Note Payable (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Convertible Note Payable Tables | |||||||||
Summary of convertible note payable | Convertible notes payable consist of the following at December 31, 2014 and 2013, respectively: | ||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
On November 25, 2014, the Company received an unsecured loan from Typenex Co-Investment, LLC (“First Typenex Note”) in the amount of $86,500, bearing interest at 10%, maturing on August 25, 2015, in exchange for net proceeds of $75,000 after the deduction of $4,000 of loan origination costs and an original issue discount (“OID”) of $7,500. The Company also issued Typenex warrants to purchase 351,455 shares of common stock at a strike price of $0.18 per share over a five year term from the date of investment. The principal and interest is convertible into shares of common stock at the discretion of the note holder at the lesser of (i) $0.18 per share, or (ii) 70% (the “Conversion Factor”) multiplied by the Market Price (as defined in the Note). If the Market Price of our common stock falls below $0.10 per share after the issuance of the Note, the Conversion Factor will automatically be reduced by 5% for all conversions completed while the Market Price is below $0.10 per share. Notwithstanding the foregoing, so long as no Event of Default has occurred, the Conversion Price shall be not less than $0.0001 (the “Conversion Floor”). For the avoidance of doubt, upon the occurrence of an Event of Default, the Conversion Floor shall not apply to any future Conversions and shall be of no further force or effect. The note can be prepaid upon notice to Typenex any time prior to the first conversion at a premium of 120% of the then outstanding balance of the Note. The note carries a default interest rate of 22% per annum. | $ | 86,500 | $ | - | |||||
On August 13, 2013, the Company received an unsecured loan from LG Capital Funding, LLC (“LG Capital”) in the amount of $26,500, bearing interest at 8%, maturing on May 13, 2014. The principal and interest was convertible into shares of common stock at the discretion of the note holder at a price equal to fifty five percent (55%) of the average of the two (2) lowest closing bid prices of the Common Stock during the ten (10) trading day period ending one trading day prior to the date the Conversion Notice was delivered, or $0.01 per share, whichever was greater. On November 6, 2013, the Company repaid the convertible note in full with a payment of $33,788, consisting of $26,500 of principal, $530 of interest and $6,758 as a prepayment penalty. | - | - | |||||||
Total convertible notes payable | 86,500 | - | |||||||
Less unamortized debt discounts: | |||||||||
Discount on beneficial conversion feature | 32,137 | - | |||||||
Original issue discount | 6,511 | - | |||||||
Discount on warrants | 32,973 | - | |||||||
Convertible notes payable | 14,879 | - | |||||||
Less: current portion | 14,879 | - | |||||||
Convertible notes payable, less current portion | $ | - | $ | - | |||||
Interest expense related to the convertible debts | The Company recognized interest expense related to the convertible debts for the years ended December 31, 2014 and 2013, respectively, as follows: | ||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Accrued interest | $ | 721 | $ | 530 | |||||
Prepayment penalty | - | 6,758 | |||||||
Amortization of loan origination costs | 527 | - | |||||||
Amortization of beneficial conversion feature | 4,882 | - | |||||||
Amortization of OID | 989 | - | |||||||
Amortization of warrants | 5,008 | - | |||||||
Total interest expense | $ | 12,127 | $ | 7,288 |
Notes_Payable_Related_Parties_
Notes Payable, Related Parties (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2014 | |||||||||||
Notes Payable Related Parties Tables | |||||||||||
Notes payable, related parties | Notes payable, related parties consist of the following at December 31, 2014 and 2013, respectively: | ||||||||||
December 31, | December 31, | ||||||||||
2014 | 2013 | ||||||||||
On November 18, 2013, the Company received an unsecured, 8% interest bearing loan in the amount of $50,000, due on August 18, 2014, or three business days following the receipt of one million dollars in funding, net of expenses, from the Company’s CEO. The note carries an additional prepayment premium of 35% of the principal if the note is not paid prior to maturity, and whereby the note holder is entitled to additional interest on the principal pursuant to the schedule listed below if the note is paid prior to maturity: | |||||||||||
No. of days after issuance date: | Prepayment Premium: | ||||||||||
0-30 days | 15% | ||||||||||
31-60 days | 20% | ||||||||||
61-90 days | 25% | ||||||||||
91-120 days | 30% | ||||||||||
121 days or more | 35% | ||||||||||
The note was repaid in full on March 12, 2014, in the total amount of $66,381, consisting of $50,000 of principal, $1,381 of interest and $15,000 of prepayment premium. | $ | - | $ | 50,000 | |||||||
On November 18, 2013, the Company received an unsecured, 8% interest bearing loan in the amount of $50,000, due on August 18, 2014, or three business days following the receipt of one million dollars in funding, net of expenses, from one of the Company’s Directors. The note carries an additional prepayment premium of 35% of the principal if the note is not paid prior to maturity, and whereby the note holder is entitled to additional interest on the principal pursuant to the same schedule listed above in the $50,000 note from the Company’s CEO. The note was repaid in full on March 12, 2014, in the total amount of $66,238, consisting of $50,000 of principal, $1,238 of interest and $15,000 of prepayment premium. | - | 50,000 | |||||||||
On May 4, 2012, the Company received an unsecured, non-interest bearing loan in the amount of $3,000, due on demand from the Company’s CEO. The note was repaid in full on March 7, 2014. | - | 3,000 | |||||||||
On May 4, 2012, the Company received an unsecured, non-interest bearing loan in the amount of $3,000, due on demand and a from the Company’s Chairman of the Board of Directors. The note was repaid in full on March12,2014. | - | 3,000 | |||||||||
On May 4, 2012, the Company received an unsecured, non-interest bearing loan in the amount of $3,000, due on demand from one of the Company’s directors. The loan was repaid in full on July 2, 2013. | - | - | |||||||||
On May 7, 2012, the Company received an unsecured, non-interest bearing loan in the amount of $3,000, due on demand from one of the Company’s directors. The note was repaid in full on March12,2014. | - | 3,000 | |||||||||
Total notes payable, related parties | - | 109,000 | |||||||||
Less: current portion | - | 109,000 | |||||||||
Notes payable, related parties, less current portion | $ | - | $ | - |
Series_A_Convertible_Preferred1
Series A Convertible Preferred Stock Warrants (Tables) | 12 Months Ended | ||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||
Series Convertible Preferred Stock Warrants Tables | |||||||||||||||||||
Summary of information about the Series A Preferred Stock Warrants outstanding | The following is a summary of information about the Series A Preferred Stock Warrants outstanding at December 31, 2014. | ||||||||||||||||||
Shares Underlying | |||||||||||||||||||
Shares Underlying Warrants Outstanding | Warrants Exercisable | ||||||||||||||||||
Weighted | |||||||||||||||||||
Shares | Average | Weighted | Shares | Weighted | |||||||||||||||
Range of | Underlying | Remaining | Average | Underlying | Average | ||||||||||||||
Exercise | Warrants | Contractual | Exercise | Warrants | Exercise | ||||||||||||||
Prices | Outstanding | Life | Price | Exercisable | Price | ||||||||||||||
$ | 0.001 | 2,000,000 | 5.5 years | $ | 0.001 | 2,000,000 | $ | 0.001 | |||||||||||
Weighted-average assumptions used for grants | The fair value of each warrant grant is estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions used for grants under the fixed option plan: | ||||||||||||||||||
December 31, | December 31, | ||||||||||||||||||
2014 | 2013 | ||||||||||||||||||
Average risk-free interest rates | N/A | N/A | |||||||||||||||||
Average expected life (in years) | N/A | N/A | |||||||||||||||||
Summary of activity of outstanding series A preferred stock warrants | The following is a summary of activity of outstanding series A preferred stock warrants: | ||||||||||||||||||
Weighted | |||||||||||||||||||
Average | |||||||||||||||||||
Number of | Exercise | ||||||||||||||||||
Shares | Price | ||||||||||||||||||
Balance, December 31, 2012 | 2,000,000 | $ | 0.001 | ||||||||||||||||
Warrants cancelled | - | - | |||||||||||||||||
Warrants granted | - | - | |||||||||||||||||
Warrants exercised | - | - | |||||||||||||||||
Balance, December 31, 2013 | 2,000,000 | $ | 0.001 | ||||||||||||||||
Warrants cancelled | - | - | |||||||||||||||||
Warrants granted | - | - | |||||||||||||||||
Warrants exercised | - | - | |||||||||||||||||
Balance, December 31, 2014 | 2,000,000 | $ | 0.001 | ||||||||||||||||
Exercisable, December 31, 2014 | 2,000,000 | $ | 0.001 |
Common_Stock_Warrants_Tables
Common Stock Warrants (Tables) | 12 Months Ended | ||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||
Common Stock Warrants Tables | |||||||||||||||||||
Summary of information about the Common Stock Warrants outstanding | The following is a summary of information about the Common Stock Warrants outstanding at December 31, 2014. | ||||||||||||||||||
Shares Underlying | |||||||||||||||||||
Shares Underlying Warrants Outstanding | Warrants Exercisable | ||||||||||||||||||
Weighted | |||||||||||||||||||
Shares | Average | Weighted | Shares | Weighted | |||||||||||||||
Range of | Underlying | Remaining | Average | Underlying | Average | ||||||||||||||
Exercise | Warrants | Contractual | Exercise | Warrants | Exercise | ||||||||||||||
Prices | Outstanding | Life | Price | Exercisable | Price | ||||||||||||||
$ | 0.00001 – $1.45 | 50,591,455 | 5.7 years | $ | 0.14434 | 39,891,455 | $ | 0.116 | |||||||||||
Weighted-average assumptions used for grants | The fair value of each warrant grant is estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions used for grants under the fixed option plan: | ||||||||||||||||||
December 31, | December 31, | ||||||||||||||||||
2014 | 2013 | ||||||||||||||||||
Average risk-free interest rates | 1.18 | % | 2.8 | % | |||||||||||||||
Average expected life (in years) | 4.24 | 1.4 | |||||||||||||||||
Summary of activity of outstanding common stock warrants | The following is a summary of activity of outstanding common stock warrants: | ||||||||||||||||||
Weighted | |||||||||||||||||||
Average | |||||||||||||||||||
Number of | Exercise | ||||||||||||||||||
Shares | Price | ||||||||||||||||||
Balance, December 31, 2012 | 39,686,489 | $ | 0.1114 | ||||||||||||||||
Warrants cancelled | (209,289 | ) | (0.4962 | ) | |||||||||||||||
Warrants granted | 460,000 | 0.8326 | |||||||||||||||||
Warrants exercised | (287,200 | ) | (0.1850 | ) | |||||||||||||||
Balance, December 31, 2013 | 39,650,000 | $ | 0.1172 | ||||||||||||||||
Warrants cancelled | (95,000 | ) | (0.75 | ) | |||||||||||||||
Warrants granted | 11,051,455 | 0.2477 | |||||||||||||||||
Warrants exercised | (15,000 | ) | (0.75 | ) | |||||||||||||||
Balance, December 31, 2014 | 50,591,455 | $ | 0.1443 | ||||||||||||||||
Exercisable, December 31, 2014 | 39,891,455 | $ | 0.116 |
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Income Taxes Tables | |||||||||
Deferred tax asset | The components of the Company’s deferred tax asset are as follows: | ||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Deferred tax assets: | |||||||||
Net operating loss carry forwards | $ | 675,610 | $ | 457,320 | |||||
Net deferred tax assets before valuation allowance | $ | 675,610 | $ | 457,320 | |||||
Less: Valuation allowance | (675,610 | ) | (457,320 | ) | |||||
Net deferred tax assets | $ | - | $ | - | |||||
Reconciliation between the amounts of income tax | A reconciliation between the amounts of income tax benefit determined by applying the applicable U.S. and State statutory income tax rate to pre-tax loss is as follows: | ||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Federal and state statutory rate | 35 | % | 35 | % | |||||
Change in valuation allowance on deferred tax assets | (35 | %) | (35 | %) |
Nature_of_Business_and_Signifi3
Nature of Business and Significant Accounting Policies (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Nature Of Business And Significant Accounting Policies | ||
Common stock issued for services | $263,079 | $1,051,609 |
Common stock issued for services, related parties | 2,965,000 | |
Warrants issued for services | 96,767 | 96,050 |
Warrants issued for services, related parties | 394,540 | 259,044 |
Stock based compensation | $754,386 | $4,371,703 |
Nature_of_Business_and_Signifi4
Nature of Business and Significant Accounting Policies (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Nature Of Business And Significant Accounting Policies Details Narrative | ||
Advertising and promotion expenses | $159,411 | $25,507 |
Going_Concern_Details_Narrativ
Going Concern (Details Narrative) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Going Concern Details Narrative | ||
Accumulated deficit | $8,195,626 | $6,785,112 |
Working capital deficit | ($72,868) |
Related_Parties_Details_Narrat
Related Parties (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Amount owed to Chairman of the Board of Directors | $11,069 | $37,690 |
Amount owed to CEO | 465 | 2,182 |
Amount owed to Boards of Directores | 13,765 | 0 |
Chief Executive Officer [Member] | ||
Amortization recorded as professonal fee | 73,403 | 0 |
Chairman, Board of Directors [Member] | ||
Amortization recorded as professonal fee | 73,403 | 0 |
One Director [Member] | ||
Amortization recorded as professonal fee | 64,227 | 0 |
Three Directors [Member] | ||
Amortization recorded as professonal fee | 165,156 | 0 |
One Director Two [Member] | ||
Amortization recorded as professonal fee | $18,351 | $0 |
Patent_Rights_and_Applications1
Patent Rights and Applications (Details Narrative) | 12 Months Ended |
Dec. 31, 2014 | |
Patent Rights And Applications Details Narrative | |
Expected useful life of the patents | 17 years |
Fair_Value_of_Financial_Instru2
Fair Value of Financial Instruments (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Cash | $102,599 | $15,800 |
Notes payable, related parties | 109,000 | |
Fair Value, Measurements, Recurring [Member] | Level 1 [Member] | ||
Cash | 102,599 | 15,800 |
Total assets | 102,599 | 15,800 |
Notes payable, related parties | ||
Total liabilities | ||
Net assets and liabilities | 102,599 | 15,800 |
Fair Value, Measurements, Recurring [Member] | Level 2 [Member] | ||
Cash | ||
Total assets | ||
Notes payable, related parties | 14,879 | 109,000 |
Total liabilities | 14,879 | 109,000 |
Net assets and liabilities | -14,879 | -109,000 |
Fair Value, Measurements, Recurring [Member] | Level 3 [Member] | ||
Cash | ||
Total assets | ||
Notes payable, related parties | ||
Total liabilities | ||
Net assets and liabilities |
Convertible_Note_Payable_Detai
Convertible Note Payable (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Total convertible note payable | $86,500 | |
Less: unamortized discount on beneficial conversion feature | 32,137 | |
Original issue discount | 6,511 | |
Discount on warrants | 32,973 | |
Convertible note payable | 14,879 | |
Less: current portion | 14,879 | |
Convertible note payable, less current portion | ||
On November 25, 2014 Unsecured loan [Member] | ||
Total convertible note payable | 86,500 | |
On August 13, 2013 Unsecured loan [Member] | ||
Total convertible note payable |
Convertible_Note_Payable_Detai1
Convertible Note Payable (Details 1) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Convertible Note Payable Details 1 | ||
Accrued interest | $721 | $530 |
Prepayment penalty | 6,758 | |
Amortization of loan origination costs | 527 | |
Amortization of beneficial conversion feature | 4,882 | |
Amortization of OID | 989 | |
Amortization of warrants | 5,008 | |
Total interest expense | $12,127 | $7,288 |
Convertible_Note_Payable_Detai2
Convertible Note Payable (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Debt amortization | $4,882 | $23,236 |
Beneficial conversion feature of convertible note | 37,019 | 23,236 |
Typenex Co-Investment, LLC Convertible Note [Member] | ||
Debt amortization | 4,882 | 0 |
LG Capital Funding, LLC Convertible Note [Member] | ||
Debt amortization | $0 | $23,236 |
Notes_Payable_Related_Parties_1
Notes Payable, Related Parties (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Total notes payable, related parties | $109,000 | |
Less: current portion | 109,000 | |
Notes payable, related parties, less current portion | ||
Chief Executive Officer [Member] | ||
Total notes payable, related parties | 50,000 | |
Chief Executive Officer [Member] | ||
Total notes payable, related parties | 50,000 | |
Director [Member] | ||
Total notes payable, related parties | 3,000 | |
Chairman, Board of Directors [Member] | ||
Total notes payable, related parties | 3,000 | |
Directors [Member] | ||
Total notes payable, related parties | ||
Director One [Member] | ||
Total notes payable, related parties | $3,000 |
Notes_Payable_Related_Parties_2
Notes Payable, Related Parties (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Notes Payable Related Parties | ||
Interest expense | $29,321 | $3,298 |
Imputed interest expense | $134 | $840 |
Series_A_Convertible_Preferred2
Series A Convertible Preferred Stock Warrants (Details) (Series A Preferred Stock [Member], USD $) | 12 Months Ended |
Dec. 31, 2014 | |
Series A Preferred Stock [Member] | |
Range of Exercise Prices | $0.00 |
Shares Underlying Warrants Outstanding | 2,000,000 |
Weighted Average Remaining Contractual Life | 5 years 6 months |
Weighted Average Excercise Price | $0.00 |
Shares Underlying Warrants Exercisable | 2,000,000 |
Weighted Average Exercise Price | $0.00 |
Series_A_Convertible_Preferred3
Series A Convertible Preferred Stock Warrants (Details 1) (Series A Preferred Stock [Member]) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Series A Preferred Stock [Member] | ||
Average risk-free interest rates | ||
Average expected life (in years) | 0 years |
Series_A_Convertible_Preferred4
Series A Convertible Preferred Stock Warrants (Details 2) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Additional Paid-In Capital | ||
Warrants outstanding, Beginning balance | 2,000,000 | |
Warrants cancelled | ||
Warrants granted | ||
Warrants exercised | ||
Warrant outstanding, Ending balancre | 2,000,000 | |
Exercisable, December 31, 2013 | 2,000,000 | |
Warrants outstanding weighted average exercise price, Beginning balance | $0.01 | |
Warrants cancelled weighted average exercise price | ||
Warrants granted weighted average exercise price | ||
Warrants exercised weighted average exercise price | ||
Warrants outstanding weighted average exercise price, Ending balance | $0.01 | |
Warrants exercisable weighted average exercise price, Ending balance | $0.01 | |
Series A Preferred Stock [Member] | ||
Warrants outstanding, Beginning balance | 2,000,000 | |
Warrants cancelled | ||
Warrants granted | ||
Warrants exercised | ||
Warrant outstanding, Ending balancre | 2,000,000 | |
Warrants outstanding weighted average exercise price, Beginning balance | $0.01 | |
Warrants cancelled weighted average exercise price | ||
Warrants granted weighted average exercise price | ||
Warrants exercised weighted average exercise price | ||
Warrants outstanding weighted average exercise price, Ending balance | $0.01 |
Common_Stock_Warrants_Details
Common Stock Warrants (Details) (Common Stock Warrants [Member], USD $) | 12 Months Ended |
Dec. 31, 2014 | |
Shares Underlying Warrants Outstanding | 50,591,455 |
Weighted Average Remaining Contractual Life | 5 years 8 months 12 days |
Weighted Average Excercise Price | $0.14 |
Shares Underlying Warrants Exercisable | 39,891,455 |
Weighted Average Exercise Price | $0.12 |
Minimum [Member] | |
Range of Exercise Prices | $0.00 |
Maximum [Member] | |
Range of Exercise Prices | $1.45 |
Common_Stock_Warrants_Details_
Common Stock Warrants (Details 1) (Common Stock Warrants [Member]) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Common Stock Warrants [Member] | ||
Average risk-free interest rates | 1.18% | 2.80% |
Average expected life (in years) | 4 years 2 months 27 days | 1 year 4 months 24 days |
Common_Stock_Warrants_Details_1
Common Stock Warrants (Details 2) (Common Stock Warrants [Member], USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Common Stock Warrants [Member] | ||
Warrants outstanding, Beginning balance | 39,650,000 | 39,686,489 |
Warrants cancelled | -95,000 | -209,289 |
Warrants granted | 11,051,455 | 460,000 |
Warrants exercised | -15,000 | -287,200 |
Warrant outstanding, Ending balancre | 50,591,455 | 39,650,000 |
Exercisable, December 31, 2013 | 39,891,455 | |
Warrants outstanding weighted average exercise price, Beginning balance | $0.12 | $0.11 |
Warrants cancelled weighted average exercise price | ($0.75) | ($0.50) |
Warrants granted weighted average exercise price | $0.25 | $0.83 |
Warrants exercised weighted average exercise price | ($0.75) | ($0.19) |
Warrants outstanding weighted average exercise price, Ending balance | $0.14 | $0.12 |
Warrants exercisable weighted average exercise price, Ending balance | $0.12 |
Common_Stock_Warrants_Details_2
Common Stock Warrants (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Professional fee | $949,319 | $1,235,270 |
Common Stock Warrants [Member] | ||
Professional fee | 5,008 | 0 |
Warrants expired | 95,000 | 209,289 |
Weighted average fair value of warrants granted | $0.23 | $0.41 |
Common Stock Warrants One [Member] | ||
Professional fee | 47,016 | |
Chief Executive Officer [Member] | ||
Professional fee | 73,403 | 0 |
Chairman, Board of Directors [Member] | ||
Professional fee | 73,403 | 0 |
One Director [Member] | ||
Professional fee | 64,227 | 0 |
Three Directors [Member] | ||
Professional fee | 165,156 | 0 |
Two Director [Member] | ||
Professional fee | 18,351 | 0 |
Common Stock Warrants One [Member] | ||
Professional fee | $0 |
Income_Taxes_Details
Income Taxes (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Income Taxes Details | ||
Net operating loss carry forwards | $675,610 | $457,320 |
Net deferred tax assets before valuation allowance | 675,610 | 457,320 |
Less: Valuation allowance | -675,610 | -457,320 |
Net deferred tax assets |
Income_Taxes_Details_1
Income Taxes (Details 1) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Income Taxes Details 1 | ||
Federal and state statutory rate | 35.00% | 35.00% |
Change in valuation allowance on deferred tax assets | -35.00% | -35.00% |
Income_Taxes_Details_Narrative
Income Taxes (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Income Taxes Details Narrative | ||
Federal net operating losses | $1,930,314 | $1,306,637 |
Federal net operating losses expire | 2031 |