Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2021 | Nov. 15, 2021 | |
Cover [Abstract] | ||
Entity Registrant Name | ENDRA LIFE SCIENCES INC. | |
Entity Central Index Key | 0001681682 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Small Business | true | |
Entity Shell Company | true | |
Entity Emerging Growth Company | true | |
Entity Current Reporting Status | Yes | |
Document Period End Date | Sep. 30, 2021 | |
Entity Filer Category | Non-accelerated Filer | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2021 | |
Entity Ex Transition Period | false | |
Entity Common Stock Shares Outstanding | 42,165,726 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 001-37969 | |
Entity Incorporation State Country Code | DE | |
Entity Tax Identification Number | 26-0579295 | |
Entity Address Address Line 1 | 3600 Green Court | |
Entity Address Address Line 2 | Suite 350 | |
Entity Address City Or Town | Ann Arbor | |
Entity Address State Or Province | MI | |
Entity Address Postal Zip Code | 48105-1570 | |
City Area Code | 734 | |
Local Phone Number | 335-0468 | |
Security 12b Title | Common Stock, par value $0.0001 per share | |
Trading Symbol | NDRA | |
Security Exchange Name | NASDAQ | |
Entity Interactive Data Current | Yes |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Current Assets | ||
Cash | $ 11,793,189 | $ 7,227,316 |
Prepaid expenses | 1,177,201 | 390,800 |
Inventory | 1,499,743 | 589,620 |
Total Current Assets | 14,470,133 | 8,207,736 |
Non-Current Assets | ||
Fixed assets, net | 162,265 | 212,242 |
Right of use assets | 675,822 | 339,012 |
Other assets | 5,986 | 5,986 |
Total Assets | 15,314,206 | 8,764,976 |
Current Liabilities | ||
Accounts payable and accrued liabilities | 1,449,130 | 910,183 |
Lease liabilities, current portion | 127,696 | 76,480 |
Total Current Liabilities | 1,576,826 | 986,663 |
Long Term Debt | ||
Loans | 28,484 | 337,084 |
Lease liabilities | 552,830 | 271,908 |
Total Long Term Debt | 581,314 | 608,992 |
Total Liabilities | 2,158,140 | 1,595,655 |
Stockholders' Equity | ||
Common stock, $0.0001 par value; 80,000,000 shares authorized; 42,165,726 and 34,049,704 shares issued and outstanding, respectively | 4,215 | 3,404 |
Additional paid in capital | 78,695,367 | 64,493,611 |
Stock payable | 42,665 | 10,794 |
Accumulated deficit | (65,586,182) | (57,338,489) |
Total Stockholders' Equity | 13,156,066 | 7,169,321 |
Total Liabilities and Stockholders' Equity | 15,314,206 | 8,764,976 |
Series A Convertible Preferred Stock | ||
Stockholders' Equity | ||
Total Stockholders' Equity | 1 | 1 |
Series A Convertible Preferred Stock, $0.0001 par value; 10,000 shares authorized; 141.397 and 190.288 shares issued and outstanding, respectively | 1 | 1 |
Series B Convertible Preferred Stock | ||
Stockholders' Equity | ||
Total Stockholders' Equity | 0 | 0 |
Series A Convertible Preferred Stock, $0.0001 par value; 10,000 shares authorized; 141.397 and 190.288 shares issued and outstanding, respectively | $ 0 | $ 0 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2021 | Jan. 01, 2021 | Dec. 31, 2020 |
Common stock shares, par value | $ 0.0001 | $ 0.0001 | |
Common stock shares, authorized | 90,000,000 | 7,461,228 | 80,000,000 |
Common stock shares, issued | 42,165,726 | 34,049,704 | |
Common stock shares, outstanding | 42,165,726 | 34,049,704 | |
Preferred stock shares, authorized | 10,000 | ||
Series A Convertible Preferred Stock | |||
Preferred stock shares, par value | $ 0.0001 | $ 0.0001 | |
Preferred stock shares, authorized | 10,000 | 10,000 | |
Preferred stock shares, issued | 141,397 | 190,288 | |
Preferred stock shares, outstanding | 141,397 | 190,288 | |
Series B Convertible Preferred Stock | |||
Preferred stock shares, par value | $ 0.0001 | $ 0.0001 | |
Preferred stock shares, authorized | 1,000 | 1,000 | |
Preferred stock shares, issued | 0 | 0 | |
Preferred stock shares, outstanding | 0 | 0 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Operating Expenses | ||||
Research and development | $ 1,173,319 | $ 1,769,339 | $ 4,059,730 | $ 4,774,534 |
Sales and marketing | 275,565 | 139,751 | 693,263 | 389,469 |
General and administrative | 1,201,851 | 1,346,360 | 3,673,771 | 4,083,572 |
Total operating expenses | 2,650,735 | 3,255,450 | 8,426,764 | 9,247,575 |
Operating loss | (2,650,735) | (3,255,450) | (8,426,764) | (9,247,575) |
Other Expenses | ||||
Amortization of debt discount | 0 | 0 | 0 | (232,426) |
Gain on extinguishment of debt | 0 | 0 | 308,600 | 0 |
Other income (expense) | (7,507) | (2,621) | (8,458) | 5,261 |
Total other expenses | (7,507) | (2,621) | 300,142 | (227,165) |
Loss from operations before income taxes | (2,658,242) | (3,258,071) | (8,126,622) | (9,474,740) |
Provision for income taxes | 0 | 0 | 0 | 0 |
Net Loss | (2,658,242) | (3,258,071) | (8,126,622) | (9,474,740) |
Deemed dividend | 0 | (395,551) | (121,071) | (395,551) |
Net loss attributable to common stockholders | $ (2,658,242) | $ (3,653,622) | $ (8,247,693) | $ (9,870,291) |
Net loss per share - basic and diluted | $ (0.06) | $ (0.15) | $ (0.20) | $ (0.41) |
Weighted average common shares - basic and diluted | 41,912,535 | 23,889,591 | 40,471,906 | 23,808,012 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders Equity (Unaudited) - USD ($) | Total | Common Stock | Additional Paid-In Capital | Stock Payable [Member] | Retained Earnings (Accumulated Deficit) | Series A Convertible Preferred Stock | Series B Convertible Preferred Stock |
Balance, shares at Dec. 31, 2019 | 8,421,401 | 6,338,490 | 351,711 | ||||
Balance, amount at Dec. 31, 2019 | $ 4,760,670 | $ 842 | $ 49,933,736 | $ 43,528 | $ (45,217,437) | $ 1 | $ 0 |
Series A Convertible Preferred Stock converted to common stock, shares | 7,173,226 | (6,148,202) | |||||
Series A Convertible Preferred Stock converted to common stock, amount | 0 | $ 717 | 75,207 | (75,924) | 0 | $ 0 | $ 0 |
Series B Convertible Preferred Stock converted to common stock, shares | 360,279 | (351,711) | |||||
Series B Convertible Preferred Stock converted to common stock, amount | 0 | $ 36 | 1,634 | (1,670) | 0 | 0 | $ 0 |
Common stock issued for cash, shares | 1,421,858 | ||||||
Common stock issued for cash, amount | 1,321,890 | $ 142 | 1,321,748 | 0 | 0 | 0 | 0 |
Common stock issued for note conversions, shares | 331,441 | ||||||
Common stock issued for note conversions, amount | 493,847 | $ 33 | 493,814 | 0 | 0 | 0 | 0 |
Common stock issued for warrant exercise, shares | 7,098,108 | ||||||
Common stock issued for warrant exercise, amount | 4,914,411 | $ 709 | 4,999,328 | (85,626) | 0 | 0 | 0 |
Common stock issued for services, shares | 52,099 | ||||||
Common stock issued for services, amount | 67,300 | $ 5 | 67,295 | 0 | 0 | 0 | 0 |
Common stock issued for RSU, shares | 157,298 | ||||||
Common stock issued for RSU, amount | 110,109 | $ 16 | 110,093 | 0 | 0 | 0 | 0 |
Cost of funding | (270,328) | 0 | (270,328) | 0 | 0 | 0 | 0 |
Fair value of vested stock options | 1,196,445 | 0 | 1,196,445 | 0 | 0 | 0 | 0 |
Fair value adjustment related to warrants repricing | 0 | 0 | 395,551 | 0 | (395,551) | 0 | 0 |
- Preference Dividend | 0 | 0 | (42,850) | 42,850 | 0 | 0 | 0 |
- Consultants | 30,000 | 0 | 0 | 30,000 | 0 | 0 | 0 |
- RSU to board and management | 185,378 | 0 | 0 | 185,378 | 0 | 0 | 0 |
Net loss | (9,474,740) | $ 0 | 0 | 0 | (9,474,740) | $ 0 | 0 |
Balance, shares at Sep. 30, 2020 | 25,015,710 | 190,288 | |||||
Balance, amount at Sep. 30, 2020 | 3,334,982 | $ 2,500 | 58,281,673 | 138,536 | (55,087,728) | $ 1 | 0 |
Balance, shares at Jun. 30, 2020 | 16,437,491 | 896,225 | |||||
Balance, amount at Jun. 30, 2020 | 976,880 | $ 1,644 | 52,227,904 | 181,437 | (51,434,106) | $ 1 | 0 |
Series A Convertible Preferred Stock converted to common stock, shares | 811,423 | (705,937) | |||||
Series A Convertible Preferred Stock converted to common stock, amount | 0 | $ 81 | 4,709 | (4,790) | 0 | $ 0 | 0 |
Common stock issued for cash, shares | 539,365 | ||||||
Common stock issued for cash, amount | 530,416 | $ 54 | 530,362 | 0 | 0 | 0 | 0 |
Common stock issued for warrant exercise, shares | 7,040,133 | ||||||
Common stock issued for warrant exercise, amount | 4,863,973 | $ 702 | 4,948,897 | (85,626) | 0 | 0 | 0 |
Common stock issued for services, shares | 30,000 | ||||||
Common stock issued for services, amount | 0 | $ 3 | 27,297 | (27,300) | 0 | 0 | 0 |
Cost of funding | (243,028) | 0 | (243,028) | 0 | 0 | 0 | 0 |
Fair value of vested stock options | 282,419 | 0 | 282,419 | 0 | 0 | 0 | 0 |
- Preference Dividend | 0 | 0 | (2,531) | 2,531 | 0 | 0 | |
- Consultants | 30,000 | 0 | 0 | 30,000 | 0 | 0 | 0 |
Net loss | (3,258,071) | $ 0 | 0 | 0 | (3,258,071) | 0 | 0 |
Common stock issued for RSUs, shares | 157,298 | ||||||
Common stock issued for RSUs, amount | 110,109 | $ 16 | 110,093 | 0 | 0 | 0 | 0 |
Deemed dividend | 0 | 0 | 395,551 | 0 | (395,551) | $ 0 | 0 |
Stock Payable for- RSUs to board and management | 42,284 | $ 0 | 0 | 42,284 | 0 | 0 | |
Balance, shares at Sep. 30, 2020 | 25,015,710 | 190,288 | |||||
Balance, amount at Sep. 30, 2020 | 3,334,982 | $ 2,500 | 58,281,673 | 138,536 | (55,087,728) | $ 1 | 0 |
Balance, shares at Dec. 31, 2020 | 34,049,704 | 196,794 | |||||
Balance, amount at Dec. 31, 2020 | 7,169,321 | $ 3,404 | 64,493,611 | 10,795 | (57,338,489) | $ 1 | 0 |
Series A Convertible Preferred Stock converted to common stock, shares | 67,889 | (55,397) | |||||
Series A Convertible Preferred Stock converted to common stock, amount | $ 7 | (7) | $ 0 | ||||
Common stock issued for warrant exercise, shares | 3,770,786 | ||||||
Common stock issued for warrant exercise, amount | 2,785,627 | $ 377 | 2,785,250 | ||||
Common stock issued for services, shares | 32,527 | ||||||
Common stock issued for services, amount | 74,000 | $ 3 | 74,997 | ||||
Common stock issued for RSU, shares | 22,815 | ||||||
Common stock issued for RSU, amount | 36,460 | $ 2 | 36,458 | ||||
Fair value of vested stock options | 922,375 | 922,375 | |||||
- Preference Dividend | (31,870) | 31,870 | |||||
Net loss | (8,126,622) | (8,126,622) | |||||
Deemed dividend | 121,071 | (121,071) | |||||
Common stock issued for cash, net of funding costs, shares | 4,198,170 | ||||||
Common stock issued for cash, net of funding costs, amount | 10,294,899 | $ 420 | 10,294,479 | ||||
Common stock issued for option exercise, shares | 23,835 | ||||||
Common stock issued for option exercise, amount | $ 2 | (2) | |||||
Balance, shares at Sep. 30, 2021 | 42,165,726 | 141,397 | |||||
Balance, amount at Sep. 30, 2021 | 13,156,066 | $ 4,215 | 78,695,367 | 42,665 | (65,586,182) | $ 1 | 0 |
Balance, shares at Jun. 30, 2021 | 41,857,352 | 141,397 | |||||
Balance, amount at Jun. 30, 2021 | 14,989,898 | $ 4,185 | 77,838,745 | 74,907 | (62,927,940) | $ 1 | 0 |
Common stock issued for RSU, shares | 22,815 | ||||||
Common stock issued for RSU, amount | 0 | $ 2 | 36,458 | (36,460) | 0 | 0 | 0 |
Fair value of vested stock options | 327,797 | 0 | 327,797 | 0 | 0 | 0 | 0 |
- Preference Dividend | 0 | 0 | (4,218) | 4,218 | 0 | 0 | 0 |
Net loss | (2,658,242) | $ 0 | 0 | 0 | (2,658,242) | 0 | 0 |
Common stock issued for cash, net of funding costs, shares | 283,953 | ||||||
Common stock issued for cash, net of funding costs, amount | 496,613 | $ 28 | 496,585 | 0 | 0 | 0 | 0 |
Common stock issued for option exercise, shares | 1,606 | ||||||
Common stock issued for option exercise, amount | 0 | $ 0 | 0 | 0 | 0 | $ 0 | 0 |
Balance, shares at Sep. 30, 2021 | 42,165,726 | 141,397 | |||||
Balance, amount at Sep. 30, 2021 | $ 13,156,066 | $ 4,215 | $ 78,695,367 | $ 42,665 | $ (65,586,182) | $ 1 | $ 0 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Cash Flows from Operating Activities | ||
Net loss | $ (8,126,622) | $ (9,474,740) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 94,977 | 45,114 |
Stock compensation expense including common stock issued for RSUs | 1,032,835 | 1,559,232 |
Amortization of debt discount | 0 | 232,426 |
Amortization of right of use assets | 75,768 | 48,859 |
Gain on extinguishment of debt | (308,600) | 0 |
Stock payable for investor relations | 0 | 30,000 |
Changes in operating assets and liabilities: | ||
Increase in prepaid expenses | (786,401) | (444,805) |
Increase in inventory | (910,123) | (209,766) |
Decrease in other asset | 0 | 29,250 |
Increase(decrease) in accounts payable and accrued liabilities | 528,797 | (444,167) |
Decrease in lease liability | (70,289) | (44,892) |
Net cash used in operating activities | (8,469,653) | (8,673,489) |
Cash Flows from Investing Activities | ||
Purchases of fixed assets | (45,000) | (10,483) |
Net cash used in investing activities | (45,000) | (10,483) |
Cash Flows from Financing Activities | ||
Proceeds from warrant exercise | 2,785,627 | 4,644,084 |
Proceeds from loans | 0 | 337,084 |
Proceeds from issuance of common stock | 10,294,899 | 1,321,890 |
Net cash provided by financing activities | 13,080,526 | 6,303,058 |
Net increase (decrease) in cash | 4,565,875 | (2,380,914) |
Cash, beginning of period | 7,227,316 | 6,174,207 |
Cash, end of period | 11,793,189 | 3,793,293 |
Supplemental disclosures of cash items | ||
Interest paid | 40,887 | 1,920 |
Income tax paid | 0 | |
Supplemental disclosures of non-cash items | ||
Conversion of convertible notes and accrued interest | 0 | 493,814 |
Exchange of balance in convertible notes and accrued interest for Series A preferred stock | 0 | 0 |
Deemed dividend | 121,071 | 395,551 |
Conversion of Series A Convertible Preferred Stock | (7) | (717) |
Conversion of Series B Convertible Preferred Stock | 0 | (36) |
Stock dividend payable | (31,870) | (47,641) |
Stock issued for RSU | 36,462 | 0 |
Right of use asset | 675,822 | 356,060 |
Lease liability | $ 680,526 | $ 364,113 |
Nature of the Business
Nature of the Business | 9 Months Ended |
Sep. 30, 2021 | |
Nature of the Business | |
Note 1. Nature of the Business | Note 1 – Nature of the Business ENDRA Life Sciences Inc. (“ENDRA” or the “Company”) has developed and is continuing to develop technology for increasing the capabilities of clinical diagnostic ultrasound to broaden patient access to the safe diagnosis and treatment of a number of significant medical conditions in circumstances where expensive X-ray computed tomography (“CT”) and magnetic resonance imaging (“MRI”) technology is unavailable or impractical. ENDRA was incorporated on July 18, 2007 as a Delaware corporation. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2021 | |
Summary of Significant Accounting Policies | |
Note 2. Summary of Significant Accounting Policies | Note 2 – Summary of Significant Accounting Policies Use of Estimates The preparation of the 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 disclosure of contingent liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates. Management makes estimates that affect certain accounts including deferred income tax assets, accrued expenses, fair value of equity instruments and reserves for any other commitments or contingencies. Any adjustments applied to estimates are recognized in the period in which such adjustments are determined. The COVID-19 outbreak, which the World Health Organization has classified as a pandemic, has prompted governments and regulatory bodies throughout the world to issue “stay-at-home” or similar orders, and enact restrictions on the performance of “non-essential” services, public gatherings and travel. The extent to which COVID-19 impacts the Company’s business and financial results will depend on numerous evolving factors including, but not limited to: the magnitude and duration of COVID-19, the extent to which it will impact worldwide macroeconomic conditions, the speed of the anticipated recovery, access to capital markets, and governmental and business reactions to the pandemic. The Company assessed certain accounting matters that generally require consideration of forecasted financial information in context with the information reasonably available to the Company and the unknown future impacts of COVID-19 as of September 30, 2021 and through the date of the filing of this Quarterly Report on Form 10-Q. The accounting matters assessed included, but were not limited to, estimates related to the accounting for potential liabilities and accrued expenses, the assumptions utilized in valuing stock-based compensation issued for services, the realization of deferred tax assets, and assessments of impairment related to long-lived assets. The Company’s future assessment of the magnitude and duration of COVID-19, as well as other factors, could result in additional material impacts to the Company’s consolidated financial statements in future reporting periods. Despite the Company’s efforts, the ultimate impact of COVID-19 on the Company’s business depends on factors beyond the Company’s knowledge or control, including the duration and severity of the outbreak, as well as third-party actions taken to contain its spread and mitigate its public health effects. As a result, the Company is unable to estimate the extent to which COVID-19 will negatively impact its financial results or liquidity. Principles of Consolidation The Company’s consolidated financial statements include all accounts of the Company and its consolidated subsidiary and/or entities as of reporting period ending date(s) and for the reporting period(s) then ended. All inter-company balances and transactions have been eliminated. Basis of Presentation The accompanying unaudited condensed consolidated financial statements and related notes have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted pursuant to such rules and regulations. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the nine months ended September 30, 2021 are not necessarily indicative of the results that may be expected for the year ending December 31, 2021. The balance sheet at December 31, 2020 has been derived from the audited financial statements at that date. For further information, refer to the financial statements and footnotes thereto included in ENDRA Life Sciences Inc. annual financial statements for the year ended December 31, 2020 included in the Company’s Annual Report on Form 10-K filed with the SEC on March 25, 2021. Cash and Cash Equivalents The Company considers all cash on hand and in banks, including accounts in book overdraft positions, certificates of deposit and other highly-liquid investments with maturities of one year or less, when purchased, to be cash. As of September 30, 2021 and December 31, 2020, the Company had no cash equivalents. The Company maintains its cash in bank deposit accounts which, at times, may exceed federally insured limits. The Company has not experienced any losses in such accounts and periodically evaluates the credit worthiness of the financial institutions and has determined the credit exposure to be negligible. Inventory The Company’s inventory is stated at the lower of cost or estimated net realizable value, with cost primarily determined on a weighted-average cost basis on the first-in, first-out method. The Company periodically determines whether a reserve should be taken for devaluation or obsolescence of inventory. Capitalization of Fixed Assets The Company capitalizes expenditures related to property and equipment, subject to a minimum rule, that have a useful life greater than one year for: (1) assets purchased; (2) existing assets that are replaced, improved or the useful lives have been extended; or (3) all land, regardless of cost. Acquisitions of new assets, additions, replacements and improvements (other than land) costing less than the minimum rule in addition to maintenance and repair costs, including any planned major maintenance activities, are expensed as incurred. Leases In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-02, “Leases.” ASU 2016-02 requires a lessee to record a right of use asset and a corresponding lease liability on the balance sheet for all leases with terms longer than 12 months. ASU 2016-02 is effective for all interim and annual reporting periods beginning after December 15, 2018. Early adoption is permitted. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest period presented in the financial statements. At September 30, 2021 and December 31, 2020 the Company recorded a lease liability of $680,526 and $348,388, respectively. At September 30, 2021 and December 31, 2020 the Company recorded a right of use asset of $675,822 and $339,012, respectively. Revenue Recognition In May 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-09, “Revenue from Contracts with Customers” (“ASC Topic 606”). This standard provides a single set of guidelines for revenue recognition to be used across all industries and requires additional disclosures. The updated guidance introduces a five-step model to achieve its core principal of the entity recognizing revenue to depict the transfer of goods or services to customers at an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company adopted the updated guidance effective January 1, 2018 using the full retrospective method. The new standard did not have a material impact on its financial position and results of operations, as it did not change the manner or timing of recognizing revenue. Under ASC Topic 606, in order to recognize revenue, the Company is required to identify an approved contract with commitments to perform respective obligations, identify rights of each party in the transaction regarding goods to be transferred, identify the payment terms for the goods transferred, verify that the contract has commercial substance and verify that collection of substantially all consideration is probable. The adoption of ASC Topic 606 did not have an impact on the Company’s operations or cash flows. Research and Development Costs The Company follows FASB Accounting Standards Codification (“ASC”) Subtopic 730-10, “Research and Development”. Research and development costs are charged to the statement of operations as incurred. During the three months ended September 30, 2021 and 2020, the Company incurred $1,173,319 and $1,769,339 of expenses related to research and development costs, respectively. During the nine months ended September 30, 2021 and 2020, the Company incurred $4,059,730 and $4,774,534 of expenses related to research and development costs, respectively. Net Earnings (Loss) Per Common Share The Company computes earnings per share under ASC Subtopic 260-10, “Earnings Per Share”. Basic earnings (loss) per share is computed by dividing the net income (loss) attributable to the common stockholders (the numerator) by the weighted average number of shares of common stock outstanding (the denominator) during the reporting periods. Diluted loss per share is computed by increasing the denominator by the weighted average number of additional shares that could have been outstanding from securities convertible into common stock (using the “treasury stock” method), unless their effect on net loss per share is anti-dilutive. There were 7,695,899 and 10,047,010 potentially dilutive shares, which include outstanding common stock options, warrants and shares of convertible preferred stock as of September 30, 2021 and December 31, 2020, respectively. The potential shares, which are excluded from the determination of basic and diluted net loss per share as their effect is anti-dilutive, are as follows: September 30, 2021 December 31, 2020 Options to purchase common stock 5,096,210 3,569,707 Warrants to purchase common stock 2,437,164 6,251,103 Shares issuable upon conversion of Series A Convertible Preferred Stock 162,525 226,200 Potential equivalent shares excluded 7,695,899 10,047,010 Fair Value Measurements Disclosures about fair value of financial instruments require disclosure of the fair value information, whether or not recognized in the balance sheet, where it is practicable to estimate that value. In accordance with ASC Topic 820, “Fair Value Measurements and Disclosures,” the Company measures certain financial instruments at fair value on a recurring basis. ASC Topic 820 defines fair value, established a framework for measuring fair value in accordance with accounting principles generally accepted in the United States, and expands disclosures about fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC Topic 820 established a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include: ● Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets; ● Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and ● Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable. The carrying amounts of the Company’s financial assets and liabilities, including cash, accounts receivable, prepaid expenses, accounts payable, accrued expenses, and other current liabilities, approximate their fair values because of the short maturity of these instruments. The fair value of notes payable and convertible notes approximates their fair values since the current interest rates and terms on these obligations are the same as prevailing market rates. Share-based Compensation The Company’s 2016 Omnibus Incentive Plan (the “Omnibus Plan”) permits the grant of stock options and other share-based awards to its employees, consultants and non-employee members of the board of directors. Each January 1 the pool of shares available for issuance under the Omnibus Plan automatically increases by an amount equal to the lesser of (i) the number of shares necessary such that the aggregate number of shares available under the Omnibus Plan equals 25% of the number of fully-diluted outstanding shares on the increase date (assuming the conversion of all outstanding shares of preferred stock and other outstanding convertible securities and exercise of all outstanding options and warrants to purchase shares) and (ii) if the board of directors takes action to set a lower amount, the amount determined by the board. On January 1, 2021, the pool of shares available for issuance under the Omnibus Plan automatically increased by 1,599,570shares, from 5,861,658 shares to 7,461,228. The Company records share-based compensation in accordance with the provisions of the Share-based Compensation Topic of the FASB Codification. The guidance requires the use of option-pricing models that require the input of highly subjective assumptions, including the option’s expected life and the price volatility of the underlying stock. The fair value of each option grant is estimated on the date of grant using the Black-Scholes option valuation model, and the resulting charge is expensed using the straight-line attribution method over the vesting period. Stock compensation expense recognized during the period is based on the value of share-based awards that were expected to vest during the period adjusted for estimated forfeitures. The estimated fair value of grants of stock options and warrants to non-employees of the Company is charged to expense, if applicable, in the financial statements. These options vest in the same manner as the employee options granted under the stock incentive plan as described above. Going Concern The Company’s financial statements are prepared using accounting principles generally accepted in the United States (“U.S. GAAP”) applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has limited commercial experience and had a cumulative net loss from inception to September 30, 2021 of $65,586,182. The Company had working capital of $12,893,307 as of September 30, 2021. The Company has not established an ongoing source of revenue sufficient to cover its operating costs and to allow it to continue as a going concern. The accompanying financial statements for the period ended September 30, 2021 have been prepared assuming the Company will continue as a going concern. Although the Company’s cash resources will likely be sufficient to meet its anticipated needs during the next twelve months, the Company will require additional financing to fund its future planned operations, including research and development and commercialization of its products. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it establishes a revenue stream and becomes profitable. Management’s plans to continue as a going concern include raising additional capital through sales of equity securities and borrowing. However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans. As described further below under “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations” the COVID-19 pandemic has impacted the Company’s business operations to some extent and is expected to continue to do so and, in light of the effect of such pandemic on financial markets, these impacts may include reduced access to capital. If the Company is not able to obtain the necessary additional financing on a timely basis, the Company will be required to delay, reduce the scope of, or eliminate one or more of the Company’s research and development activities or commercialization efforts or perhaps even cease the operation of its business. The ability of the Company to continue as a going concern is dependent upon its ability to successfully secure other sources of financing and attain profitable operations. The accompanying consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. Recent Accounting Pronouncements The Company considered recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the SEC, did not or in management’s opinion will not have a material impact on the Company’s present or future consolidated financial statements. |
Inventory
Inventory | 9 Months Ended |
Sep. 30, 2021 | |
Inventory | |
Note 3. Inventory | Note 3 – Inventory As of September 30, 2021 and December 31, 2020, inventory consisted of raw materials and subassemblies to be used in the assembly of a TAEUS system. As of September 30, 2021, the Company had no orders pending for the sale of a TAEUS system. |
Fixed Assets
Fixed Assets | 9 Months Ended |
Sep. 30, 2021 | |
Fixed Assets | |
Note 4. Fixed Assets | Note 4 – Fixed Assets As of September 30, 2021 and December 31, 2020, fixed assets consisted of the following: September 30, 2021 December 31, 2020 Property, leasehold and capitalized software $ 718,902 $ 718,902 TAEUS development and testing 124,208 79,207 Accumulated depreciation (680,845 ) (585,867 ) Fixed assets, net $ 162,265 $ 212,242 Depreciation expense for the nine months ended September 30, 2021 and 2020 was $94,977 and $45,114, respectively. |
Accounts Payable and Accrued Li
Accounts Payable and Accrued Liabilities | 9 Months Ended |
Sep. 30, 2021 | |
Accounts Payable and Accrued Liabilities | |
Note 5. Accounts Payable and Accrued Liabilities | Note 5 – Accounts Payable and Accrued Liabilities As of September 30, 2021 and December 31, 2020, current liabilities consisted of the following: September 30, 2021 December 31, 2020 Accounts payable $ 747,762 $ 402,910 Accrued payroll 196,079 48,260 Accrued bonuses 294,554 369,393 Accrued employee benefits 5,750 5,750 Insurance premium financing 204,985 83,870 Total $ 1,449,130 $ 910,183 |
Bank Loans
Bank Loans | 9 Months Ended |
Sep. 30, 2021 | |
Bank Loans | |
Note 6. Bank Loans | Note 6 – Bank Loans U.S. SBA Paycheck Protection Program In April 2020, the Company issued a U.S. Small Business Administration (“SBA”) Paycheck Protection Program Note (the “SBA Note”) to First Republic Bank (the “Lender”) for a loan in the principal amount of $308,600 (the “SBA Loan”) under the Paycheck Protection Program (“PPP”) promulgated under the Coronavirus Aid, Relief and Economic Security Act of 2020, as modified by the Paycheck Protection Program Flexibility Act of 2020. The Company has applied to the Lender for the SBA Loan to be forgiven and on May 10, 2021 received notice that the SBA Loan had been forgiven in full in accordance with the terms and provisions of the PPP. The Company did not provide any collateral or personal guarantees for the SBA Loan, nor did the Company pay any facility charge to the government or to the Lender. Toronto-Dominion Bank Loan On April 27, 2020, the Company entered into a commitment loan with TD Bank under the Canadian Emergency Business Account, in the principal aggregate amount of CAD 40,000, which is due and payable upon the expiration of the initial term on December 31, 2022. This note bears interest on the unpaid balance at the rate of zero percent (0%) per annum during the initial term. Under this note no interest payments are due until January 1, 2023. Under the conditions of the loan, twenty-five percent (25%) of the loan will be forgiven if seventy-five percent (75%) is repaid prior to the initial term date. |
Capital Stock
Capital Stock | 9 Months Ended |
Sep. 30, 2021 | |
Stockholders' Equity | |
Note 7. Capital Stock | Note 7 – Capital Stock At September 30, 2021, the authorized capital of the Company consisted of 90,000,000 shares of capital stock, comprised of 80,000,000 shares of common stock with a par value of $0.0001 per share, and 10,000,000 shares of preferred stock with a par value of $0.0001 per share. The Company has designated 10,000 shares of its preferred stock as Series A Convertible Preferred Stock (“Series A Preferred Stock”) and 1,000 shares of its preferred stock as Series B Convertible Preferred Stock (“Series B Preferred Stock”), and the remainder of 9,989,000 shares remain authorized but undesignated. As of September 30, 2021, there were 42,165,726 shares of common stock, 141,397 shares of Series A Preferred Stock, and no shares of Series B Preferred Stock issued and outstanding, and a stock payable balance of $42,665. During the nine months ended September 30, 2021, the Company issued a total of 8,116,023 shares of its common stock, as follows: ● 67,889 shares upon the conversion of 55.397 shares of its Series A Preferred Stock; ● 4,198,170 shares in return for aggregate net proceeds of $10,294,904 from sales of common stock; ● 3,567,899 shares upon warrant exercises for an aggregate exercise price of $2,785,627; ● 202,887 shares upon cashless warrant exercises; ● 23,835 shares upon cashless option exercise; and ● 32,527 shares for services valued at $74,000. ● 22,815 shares for RSUs valued at $36,460. At-the-Market Equity Offering Programs During the nine months ended September 30, 2021, the Company entered into at-the-market equity offering sales agreements with Ascendiant to sell shares of common stock. On February 19, 2021, the Company entered into the At-The-Market Issuance Sales Agreement with Ascendiant (the “February 2021 ATM Agreement”) to sell shares of common stock for aggregate gross proceeds of up to $12.6 million, from time to time, through an “at-the-market” equity offering program under which Ascendiant acted as sales agent. On June 21, 2021, the Company entered into the At-The-Market Issuance Sales Agreement with Ascendiant (the “June 2021 ATM Agreement” and, together with the February 2021 ATM Agreement, the “2021 ATM Agreements”) to sell shares of common stock for aggregate gross proceeds of up to $20.0 million, from time to time, through an “at-the-market” equity offering program under which Ascendiant acts as sales agent. The February 2021 ATM Agreement terminated upon the Company’s and Ascendiant’s entry into the June 2021 ATM Agreement. Prior to its termination in June 2021, under the February 2021 ATM Agreement the Company issued an aggregate of 3,914,217 shares of common stock in return for net proceeds of $9,798,293, resulting in approximately $303,243 of compensation paid to Ascendiant. As of September 30, 2021, under the June 2021 ATM Agreement the Company has issued an aggregate of 283,953 shares of common stock in return for net proceeds of $496,613, resulting in approximately $15,461 of compensation paid to Ascendiant. |
Common Stock Options and Restri
Common Stock Options and Restricted Stock Units (RSU's) | 9 Months Ended |
Sep. 30, 2021 | |
Common Stock Options and Restricted Stock Units (RSU's) | |
Note 8. Common Stock Options and Restricted Stock Units (RSU's) | Note 8 – Common Stock Options and Restricted Stock Units (“RSU’s’’) Common Stock Options Stock options are awarded to the Company’s employees, consultants and non-employee members of the board of directors under the 2016 Omnibus Incentive Plan (the “Omnibus Plan”) and are generally granted with an exercise price equal to the market price of the Company’s common stock at the date of grant. The aggregate fair value of these stock options granted by the Company during the nine months ended September 30, 2021 was determined to be $3,511,662 using the Black-Scholes-Merton option-pricing model based on the following assumptions: (i) volatility rate of 81% to 99%, (ii) discount rate of 0%, (iii) zero expected dividend yield, and (iv) expected life of 8-10 years. A summary of option activity under the Company’s Omnibus Plan as of September 30, 2021, and changes during the period then ended, is presented below: Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term (Years) Balance outstanding at December 31, 2020 3,569,707 $ 2.13 7.50 Granted 1,679,000 1.98 7.59 Exercised (37,645 ) - - Forfeited - - - Cancelled or expired (114,852 ) - - Balance outstanding at September 30, 2021 5,096,210 $ 2.08 7.03 Exercisable at September 30, 2021 2,073,249 $ 2.79 5.90 Restricted Stock Units A restricted stock unit grants a participant the right to receive one share of common stock, following the completion of the requisite service period. RSU’s are classified as equity. Compensation cost is based on the Company’s stock price on the grant date and is recognized on a straight-line basis over the vesting period for the entire award. On January 28, 2021, the Company granted 22,815 RSU’s to a member of management. The RSU’s vested immediately. The total fair value of the RSU’s granted on January 28, 2021 was $45,858, based on the grant date closing price of $2.01 per share. As of September 30, 2021 the Company had issued and vested the following RSU’s: Restricted Stock Units Outstanding Weighted Average Grant Date Fair Value Balance Outstanding at December 31, 2020 - $ - Granted 22,815 0.70 Vested / Released 22,815 - Forfeited - - Cancelled or expired - - Balance outstanding at September 30, 2021 - $ - |
Common Stock Warrants
Common Stock Warrants | 9 Months Ended |
Sep. 30, 2021 | |
Common Stock Warrants | |
Note 9. Common Stock Warrants | Note 9 – Common Stock Warrants Certain holders of our warrants issued in private placements in (i) June 2018, exercisable for an aggregate of 283,337 shares of common stock, (ii) July 2019, exercisable for an aggregate of 1,910,540 shares of common stock, and (iii) December 2019, exercisable for an aggregate of 8,958,358 shares of common stock (collectively, the “Private Warrants”) indicated to the Company that they were willing to exercise their Private Warrants at reduced exercise prices. Our board of directors approved the Company’s partially waiving the exercise prices of Private Warrants to provide for reduced exercised prices which resulted in a deemed dividend. Prices were subsequently agreed upon between the Company and each exercising warrant holder, and the Company obtained stockholder approval for the issuance of an aggregate number of shares of the Company’s common stock upon the exercise of Private Warrants greater than 19.99% of the number of shares outstanding prior to any such issuance, in compliance with Nasdaq Listing Rule 5635(d). On December 15, 2020, the Company issued warrants exercisable for 314,291 shares of the Company’s common stock. Each warrant entitles the holder to purchase shares of common stock for an exercise price per share equal to $0.875 and expire December 15, 2025. The fair value of these warrants was determined to be $171,520 using the Black-Scholes option-pricing model based on the following assumptions: (i) volatility rate of 89%, (ii) discount rate of 0%, (iii) zero expected dividend yield, and (iv) expected life of 5 years. During the nine months ended September 30, 2021, the Company issued an aggregate of 3,567,899 shares of its common stock upon Private Warrant exercises for net proceeds of $2,785,626. During the nine months ended September 30, 2021, the Company issued an aggregate of 202,887 shares of its common stock upon the cashless exercise election by certain warrant holders. The following table summarizes all stock warrant activity of the Company for the nine months ended September 30, 2021: Number of Warrants Weighted Average Exercise Price Weighted Average Contractual Term (Years) Balance outstanding at December 31, 2020 6,251,103 $ 2.79 2.79 Granted 314,291 0.88 4.21 Exercised (3,916,996 ) 0.83 3.10 Forfeited - - - Expired (211,234 ) - - Balance outstanding at September 30, 2021 2,437,164 $ 5.54 0.83 Exercisable at September 30, 2021 2,437,164 $ 5.54 0.83 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies | |
Note 10. Commitments & Contingencies | Note 10 – Commitments & Contingencies Office Lease Effective January 1, 2015, the Company entered into an office lease agreement with Green Court, LLC, a Michigan limited liability company, for approximately 3,657 rentable square feet of space, for the initial monthly rent of $5,986, which commenced on January 1, 2015 for an initial term of 60 months. On October 10, 2017 this lease was amended increasing the rentable square feet of space to 3,950 and the monthly rent to $7,798. On July 16, 2019, the Company exercised its option to extend the lease for an additional 5 years past the initial term originally expiring on December 31, 2019. On March 15, 2021, the Company entered into an amendment to the lease, adding approximately 3,248 rentable square feet, increasing the initial monthly rent to $15,452 effective May 2021, and extending the term of the lease to December 31, 2025. The Company records the lease asset and lease liability at the present value of lease payments over the lease term. The lease typically does not provide an implicit rate; therefore, the Company uses its estimated incremental borrowing rate at the time of lease commencement to discount the present value of lease payments. The Company’s discount rate for operating leases at September 30, 2021 was 10%. Lease expense is recognized on a straight-line basis over the lease term to the extent that collection is considered probable. As a result, the Company has been recognizing rents as they become payable based on the adoption of ASC Topic 842. The weighted-average remaining lease term is 4.25 years. As of September 30, 2021, the maturities of operating lease liabilities are as follows: Operating Lease 2021 $ 46,355 2022 190,963 2023 196,721 2024 202,624 2025 and beyond 202,624 Total $ 839,287 Less: amount representing interest (158,761 ) Present value of future minimum lease payments 680,526 Less: current obligations under leases 127,696 Long-term lease obligations $ 552,830 For the three months ended September 30, 2021 and 2020, the Company incurred rent expenses of $53,263 and $29,581, respectively. For the nine months ended September 30, 2021 and 2020, the Company incurred rent expenses of $119,802 and $90,484, respectively. Employment and Consulting Agreements Francois Michelon If Mr. Michelon’s employment is terminated by the Company without cause or Mr. Michelon terminates his employment for good reason, Mr. Michelon will be entitled to receive 12 months’ continuation of his current base salary and a lump sum payment equal to 12 months of continued healthcare coverage (or 24 months’ continuation of his current base salary and a lump sum payment equal to 24 months of continued healthcare coverage if such termination occurs within one year following a change in control). Under his employment agreement, Mr. Michelon is eligible to receive benefits that are substantially similar to those of the Company’s other senior executive officers. Michael Thornton If Mr. Thornton’s employment is terminated by the Company without cause or Mr. Thornton terminates his employment for good reason, Mr. Thornton will be entitled to receive 12 months’ continuation of his current base salary and a lump sum payment equal to 12 months of continued healthcare coverage (or 24 months’ continuation of his current base salary and a lump sum payment equal to 24 months of continued healthcare coverage if such termination occurs within one year following a change in control). Under his employment agreement, Mr. Thornton is eligible to receive benefits that are substantially similar to those of the Company’s other senior executive officers. David Wells Pursuant to the employment agreement, on May 13, 2019 Mr. Wells was granted stock options to purchase 56,000 shares of the Company’s common stock. The stock options have an exercise price of $1.38 per share, and vest in three equal annual installments beginning on the first anniversary of the grant date. On June 9, 2021, Mr. Wells notified the Company of his resignation as the Company’s Chief Financial Officer, effective June 18, 2021. On June 11, 2021, the Company’s Board of Directors appointed Irina Pestrikova as Senior Director, Finance, effective upon Mr. Wells’ resignation. Ms. Pestrikova will serve as the Company’s Principal Financial Officer in such role. In connection with her appointment, Ms. Pestrikova will receive 75,000 stock options vesting in three equal annual installments. She will receive an annual salary of $160,000. Litigation From time to time the Company may become a party to litigation in the normal course of business. As of September 30, 2021, there were no legal matters that management believes would have a material effect on the Company’s financial position or results of operations. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Summary of Significant Accounting Policies | |
Use of Estimates | The preparation of the 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 disclosure of contingent liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates. Management makes estimates that affect certain accounts including deferred income tax assets, accrued expenses, fair value of equity instruments and reserves for any other commitments or contingencies. Any adjustments applied to estimates are recognized in the period in which such adjustments are determined. The COVID-19 outbreak, which the World Health Organization has classified as a pandemic, has prompted governments and regulatory bodies throughout the world to issue “stay-at-home” or similar orders, and enact restrictions on the performance of “non-essential” services, public gatherings and travel. The extent to which COVID-19 impacts the Company’s business and financial results will depend on numerous evolving factors including, but not limited to: the magnitude and duration of COVID-19, the extent to which it will impact worldwide macroeconomic conditions, the speed of the anticipated recovery, access to capital markets, and governmental and business reactions to the pandemic. The Company assessed certain accounting matters that generally require consideration of forecasted financial information in context with the information reasonably available to the Company and the unknown future impacts of COVID-19 as of September 30, 2021 and through the date of the filing of this Quarterly Report on Form 10-Q. The accounting matters assessed included, but were not limited to, estimates related to the accounting for potential liabilities and accrued expenses, the assumptions utilized in valuing stock-based compensation issued for services, the realization of deferred tax assets, and assessments of impairment related to long-lived assets. The Company’s future assessment of the magnitude and duration of COVID-19, as well as other factors, could result in additional material impacts to the Company’s consolidated financial statements in future reporting periods. Despite the Company’s efforts, the ultimate impact of COVID-19 on the Company’s business depends on factors beyond the Company’s knowledge or control, including the duration and severity of the outbreak, as well as third-party actions taken to contain its spread and mitigate its public health effects. As a result, the Company is unable to estimate the extent to which COVID-19 will negatively impact its financial results or liquidity. |
Principles of Consolidation | The Company’s consolidated financial statements include all accounts of the Company and its consolidated subsidiary and/or entities as of reporting period ending date(s) and for the reporting period(s) then ended. All inter-company balances and transactions have been eliminated. |
Basis of Presentation | The accompanying unaudited condensed consolidated financial statements and related notes have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted pursuant to such rules and regulations. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the nine months ended September 30, 2021 are not necessarily indicative of the results that may be expected for the year ending December 31, 2021. The balance sheet at December 31, 2020 has been derived from the audited financial statements at that date. For further information, refer to the financial statements and footnotes thereto included in ENDRA Life Sciences Inc. annual financial statements for the year ended December 31, 2020 included in the Company’s Annual Report on Form 10-K filed with the SEC on March 25, 2021. |
Cash and Cash Equivalents | The Company considers all cash on hand and in banks, including accounts in book overdraft positions, certificates of deposit and other highly-liquid investments with maturities of one year or less, when purchased, to be cash. As of September 30, 2021 and December 31, 2020, the Company had no cash equivalents. The Company maintains its cash in bank deposit accounts which, at times, may exceed federally insured limits. The Company has not experienced any losses in such accounts and periodically evaluates the credit worthiness of the financial institutions and has determined the credit exposure to be negligible. |
Inventory | The Company’s inventory is stated at the lower of cost or estimated net realizable value, with cost primarily determined on a weighted-average cost basis on the first-in, first-out method. The Company periodically determines whether a reserve should be taken for devaluation or obsolescence of inventory. |
Capitalization of Fixed Assets | The Company capitalizes expenditures related to property and equipment, subject to a minimum rule, that have a useful life greater than one year for: (1) assets purchased; (2) existing assets that are replaced, improved or the useful lives have been extended; or (3) all land, regardless of cost. Acquisitions of new assets, additions, replacements and improvements (other than land) costing less than the minimum rule in addition to maintenance and repair costs, including any planned major maintenance activities, are expensed as incurred. |
Leases | In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-02, “Leases.” ASU 2016-02 requires a lessee to record a right of use asset and a corresponding lease liability on the balance sheet for all leases with terms longer than 12 months. ASU 2016-02 is effective for all interim and annual reporting periods beginning after December 15, 2018. Early adoption is permitted. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest period presented in the financial statements. At September 30, 2021 and December 31, 2020 the Company recorded a lease liability of $680,526 and $348,388, respectively. At September 30, 2021 and December 31, 2020 the Company recorded a right of use asset of $675,822 and $339,012, respectively. |
Revenue Recognition | In May 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-09, “Revenue from Contracts with Customers” (“ASC Topic 606”). This standard provides a single set of guidelines for revenue recognition to be used across all industries and requires additional disclosures. The updated guidance introduces a five-step model to achieve its core principal of the entity recognizing revenue to depict the transfer of goods or services to customers at an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company adopted the updated guidance effective January 1, 2018 using the full retrospective method. The new standard did not have a material impact on its financial position and results of operations, as it did not change the manner or timing of recognizing revenue. Under ASC Topic 606, in order to recognize revenue, the Company is required to identify an approved contract with commitments to perform respective obligations, identify rights of each party in the transaction regarding goods to be transferred, identify the payment terms for the goods transferred, verify that the contract has commercial substance and verify that collection of substantially all consideration is probable. The adoption of ASC Topic 606 did not have an impact on the Company’s operations or cash flows. |
Research and Development Costs | The Company follows FASB Accounting Standards Codification (“ASC”) Subtopic 730-10, “Research and Development”. Research and development costs are charged to the statement of operations as incurred. During the three months ended September 30, 2021 and 2020, the Company incurred $1,173,319 and $1,769,339 of expenses related to research and development costs, respectively. During the nine months ended September 30, 2021 and 2020, the Company incurred $4,059,730 and $4,774,534 of expenses related to research and development costs, respectively. |
Net Earnings (Loss) Per Common Share | The Company computes earnings per share under ASC Subtopic 260-10, “Earnings Per Share”. Basic earnings (loss) per share is computed by dividing the net income (loss) attributable to the common stockholders (the numerator) by the weighted average number of shares of common stock outstanding (the denominator) during the reporting periods. Diluted loss per share is computed by increasing the denominator by the weighted average number of additional shares that could have been outstanding from securities convertible into common stock (using the “treasury stock” method), unless their effect on net loss per share is anti-dilutive. There were 7,695,899 and 10,047,010 potentially dilutive shares, which include outstanding common stock options, warrants and shares of convertible preferred stock as of September 30, 2021 and December 31, 2020, respectively. The potential shares, which are excluded from the determination of basic and diluted net loss per share as their effect is anti-dilutive, are as follows: September 30, 2021 December 31, 2020 Options to purchase common stock 5,096,210 3,569,707 Warrants to purchase common stock 2,437,164 6,251,103 Shares issuable upon conversion of Series A Convertible Preferred Stock 162,525 226,200 Potential equivalent shares excluded 7,695,899 10,047,010 |
Fair Value Measurements | Disclosures about fair value of financial instruments require disclosure of the fair value information, whether or not recognized in the balance sheet, where it is practicable to estimate that value. In accordance with ASC Topic 820, “Fair Value Measurements and Disclosures,” the Company measures certain financial instruments at fair value on a recurring basis. ASC Topic 820 defines fair value, established a framework for measuring fair value in accordance with accounting principles generally accepted in the United States, and expands disclosures about fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC Topic 820 established a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include: ● Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets; ● Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and ● Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable. The carrying amounts of the Company’s financial assets and liabilities, including cash, accounts receivable, prepaid expenses, accounts payable, accrued expenses, and other current liabilities, approximate their fair values because of the short maturity of these instruments. The fair value of notes payable and convertible notes approximates their fair values since the current interest rates and terms on these obligations are the same as prevailing market rates. |
Share-based Compensation | The Company’s 2016 Omnibus Incentive Plan (the “Omnibus Plan”) permits the grant of stock options and other share-based awards to its employees, consultants and non-employee members of the board of directors. Each January 1 the pool of shares available for issuance under the Omnibus Plan automatically increases by an amount equal to the lesser of (i) the number of shares necessary such that the aggregate number of shares available under the Omnibus Plan equals 25% of the number of fully-diluted outstanding shares on the increase date (assuming the conversion of all outstanding shares of preferred stock and other outstanding convertible securities and exercise of all outstanding options and warrants to purchase shares) and (ii) if the board of directors takes action to set a lower amount, the amount determined by the board. On January 1, 2021, the pool of shares available for issuance under the Omnibus Plan automatically increased by 1,599,570shares, from 5,861,658 shares to 7,461,228. The Company records share-based compensation in accordance with the provisions of the Share-based Compensation Topic of the FASB Codification. The guidance requires the use of option-pricing models that require the input of highly subjective assumptions, including the option’s expected life and the price volatility of the underlying stock. The fair value of each option grant is estimated on the date of grant using the Black-Scholes option valuation model, and the resulting charge is expensed using the straight-line attribution method over the vesting period. Stock compensation expense recognized during the period is based on the value of share-based awards that were expected to vest during the period adjusted for estimated forfeitures. The estimated fair value of grants of stock options and warrants to non-employees of the Company is charged to expense, if applicable, in the financial statements. These options vest in the same manner as the employee options granted under the stock incentive plan as described above. |
Going Concern | The Company’s financial statements are prepared using accounting principles generally accepted in the United States (“U.S. GAAP”) applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has limited commercial experience and had a cumulative net loss from inception to September 30, 2021 of $65,586,182. The Company had working capital of $12,893,307 as of September 30, 2021. The Company has not established an ongoing source of revenue sufficient to cover its operating costs and to allow it to continue as a going concern. The accompanying financial statements for the period ended September 30, 2021 have been prepared assuming the Company will continue as a going concern. Although the Company’s cash resources will likely be sufficient to meet its anticipated needs during the next twelve months, the Company will require additional financing to fund its future planned operations, including research and development and commercialization of its products. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it establishes a revenue stream and becomes profitable. Management’s plans to continue as a going concern include raising additional capital through sales of equity securities and borrowing. However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans. As described further below under “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations” the COVID-19 pandemic has impacted the Company’s business operations to some extent and is expected to continue to do so and, in light of the effect of such pandemic on financial markets, these impacts may include reduced access to capital. If the Company is not able to obtain the necessary additional financing on a timely basis, the Company will be required to delay, reduce the scope of, or eliminate one or more of the Company’s research and development activities or commercialization efforts or perhaps even cease the operation of its business. The ability of the Company to continue as a going concern is dependent upon its ability to successfully secure other sources of financing and attain profitable operations. The accompanying consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. |
Recent Accounting Pronouncements | The Company considered recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the SEC, did not or in management’s opinion will not have a material impact on the Company’s present or future consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Summary of Significant Accounting Policies | |
Schedule of Anti-dilutive shares | September 30, 2021 December 31, 2020 Options to purchase common stock 5,096,210 3,569,707 Warrants to purchase common stock 2,437,164 6,251,103 Shares issuable upon conversion of Series A Convertible Preferred Stock 162,525 226,200 Potential equivalent shares excluded 7,695,899 10,047,010 |
Fixed Assets (Tables)
Fixed Assets (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Fixed Assets | |
Schedule Fixed assets | September 30, 2021 December 31, 2020 Property, leasehold and capitalized software $ 718,902 $ 718,902 TAEUS development and testing 124,208 79,207 Accumulated depreciation (680,845 ) (585,867 ) Fixed assets, net $ 162,265 $ 212,242 |
Accounts Payable and Accrued _2
Accounts Payable and Accrued Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Accounts Payable and Accrued Liabilities | |
Schedule of Current liabilities | September 30, 2021 December 31, 2020 Accounts payable $ 747,762 $ 402,910 Accrued payroll 196,079 48,260 Accrued bonuses 294,554 369,393 Accrued employee benefits 5,750 5,750 Insurance premium financing 204,985 83,870 Total $ 1,449,130 $ 910,183 |
Common Stock Options and Rest_2
Common Stock Options and Restricted Stock Units (RSU's) (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Common Stock Options and Restricted Stock Units (RSU's) | |
Summary of stock option activity | Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term (Years) Balance outstanding at December 31, 2020 3,569,707 $ 2.13 7.50 Granted 1,679,000 1.98 7.59 Exercised (37,645 ) - - Forfeited - - - Cancelled or expired (114,852 ) - - Balance outstanding at September 30, 2021 5,096,210 $ 2.08 7.03 Exercisable at September 30, 2021 2,073,249 $ 2.79 5.90 |
Summary of restricted Stock Units | Restricted Stock Units Outstanding Weighted Average Grant Date Fair Value Balance Outstanding at December 31, 2020 - $ - Granted 22,815 0.70 Vested / Released 22,815 - Forfeited - - Cancelled or expired - - Balance outstanding at September 30, 2021 - $ - |
Common Stock Warrants (Tables)
Common Stock Warrants (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Common Stock Warrants (Tables) | |
Schedule of warrant activity | Number of Warrants Weighted Average Exercise Price Weighted Average Contractual Term (Years) Balance outstanding at December 31, 2020 6,251,103 $ 2.79 2.79 Granted 314,291 0.88 4.21 Exercised (3,916,996 ) 0.83 3.10 Forfeited - - - Expired (211,234 ) - - Balance outstanding at September 30, 2021 2,437,164 $ 5.54 0.83 Exercisable at September 30, 2021 2,437,164 $ 5.54 0.83 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies | |
Schedule of operating lease liabilities maturities | Operating Lease 2021 $ 46,355 2022 190,963 2023 196,721 2024 202,624 2025 and beyond 202,624 Total $ 839,287 Less: amount representing interest (158,761 ) Present value of future minimum lease payments 680,526 Less: current obligations under leases 127,696 Long-term lease obligations $ 552,830 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) - shares | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Potential equivalent shares excluded | 7,695,899 | 10,047,010 |
Options To Purchase Common Stock | ||
Potential equivalent shares excluded | 5,096,210 | 3,569,707 |
Warrants To Purchase Common Stock | ||
Potential equivalent shares excluded | 2,437,164 | 6,251,103 |
Shares Issuable upon Conversion of Series A Convertible Preferred Stock | ||
Potential equivalent shares excluded | 162,525 | 226,200 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Jan. 01, 2021 | |
Summary of Significant Accounting Policies | ||||||
Research and development | $ 1,173,319 | $ 1,769,339 | $ 4,059,730 | $ 4,774,534 | ||
Anti-dilutive shares exluded from the calculation of earnings per share | 7,695,899 | 10,047,010 | ||||
Shares available for issuance under the Omnibus Plan | 5,861,658 | |||||
Shares available for issuance increased under the Omnibus Plan | 1,599,570 | |||||
Shares available | 90,000,000 | 90,000,000 | 80,000,000 | 7,461,228 | ||
Cumulative net loss | $ (65,586,182) | $ (65,586,182) | $ (57,338,489) | |||
Working capital | (12,893,307) | (12,893,307) | ||||
Lease liability | 680,526 | 680,526 | 348,388 | |||
Right of use asset | $ 675,822 | $ 675,822 | $ 339,012 | |||
Share based compensation, description | On January 1, 2021, the pool of shares available for issuance under the Omnibus Plan automatically increased by 1,599,570shares, from 5,861,658 shares to 7,461,228. |
Fixed Assets (Details)
Fixed Assets (Details) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Accumulated depreciation | $ (680,845) | $ (585,867) |
Fixed assets, net | 162,265 | 212,242 |
Property, leasehold and capitalized software | ||
Fixed assets, gross | 718,902 | 718,902 |
TAEUS development and testing | ||
Fixed assets, gross | $ 124,208 | $ 79,207 |
Fixed Assets (Details Narrative
Fixed Assets (Details Narrative) - USD ($) | 6 Months Ended | 9 Months Ended |
Sep. 30, 2020 | Sep. 30, 2021 | |
Fixed Assets | ||
Depreciation expense | $ 45,114 | $ 94,977 |
Accounts Payable and Accrued _3
Accounts Payable and Accrued Liabilities (Details) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Accounts Payable and Accrued Liabilities | ||
Accounts payable | $ 747,762 | $ 402,910 |
Accrued payroll | 196,079 | 48,260 |
Accrued bonuses | 294,554 | 369,393 |
Accrued employee benefits | 5,750 | 5,750 |
Insurance premium financing | 204,985 | 83,870 |
Total | $ 1,449,130 | $ 910,183 |
Bank Loans (Details Narrative)
Bank Loans (Details Narrative) - USD ($) | 1 Months Ended | |
Apr. 27, 2020 | Sep. 30, 2021 | |
TD Bank Loan [Member] | ||
Principal aggregate amount | $ 40,000 | |
Expiration initial term | Dec. 31, 2022 | |
Initial term interest rate | 0.00% | |
Bank loan, description | Under this note no interest payments are due until January 1, 2023. Under the conditions of the loan, twenty-five percent (25%) of the loan will be forgiven if seventy-five percent (75%) is repaid prior to the initial term date. | |
April 2020 [Member] | U.S. SBA Paycheck Protection Program [Member] | ||
Loan principal amount | $ 308,600 |
Capital Stock (Details Narrativ
Capital Stock (Details Narrative) - USD ($) | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Jan. 01, 2021 | Dec. 31, 2020 | |
Common stock shares, par value | $ 0.0001 | $ 0.0001 | ||
Common stock shares, authorized | 90,000,000 | 7,461,228 | 80,000,000 | |
Common stock shares, issued | 42,165,726 | 34,049,704 | ||
Preferred stock shares, authorized | 10,000 | |||
Stock based compensation | $ 15,461 | |||
Stock payable, share | 42,665 | |||
Total common stock shares issued | $ 8,116,023 | |||
Common stock shares upon warrat exercise, shares | 3,567,899 | |||
Common stock shares upon warrat exercise, amount | $ 2,785,627 | |||
Proceeds from sales of common stock, shares return | 4,198,170 | |||
Common stock shares upon cashless option exercise | 23,835 | |||
Common stock shares upon cashless warrant exercise | 202,887 | |||
Common stock share issued for service, Shares | 32,527 | |||
Common stock share issued for service, Amount | $ 74,000 | |||
Proceeds from sales of common stock | $ 10,294,904 | |||
Common stock share issued for RSUs, Shares | 22,815 | |||
Common stock share issued for RSUs, Amount | $ 36,460 | |||
Common stock shares, outstanding | 42,165,726 | 34,049,704 | ||
Aggregate gross proceeds from issuance of common stock shares | $ 12,600,000 | |||
Proceeds from issuance of common stock shares | $ 10,294,899 | $ 1,321,890 | ||
February 2021 ATM Agreement [Member] | ||||
Common stock shares, issued | 3,914,217 | |||
Stock based compensation | $ 303,243 | |||
Net proceeds from sales of common stock | 9,798,293 | |||
Gross proceeds from sales of common stock | 20,000,000 | |||
Proceeds from issuance of common stock shares | $ 496,613 | |||
Common stock shares issued durng period | 283,953 | |||
Series A Convertible Preferred Stock | ||||
Preferred stock shares, authorized | 10,000 | 10,000 | ||
Preferred stock shares, par value | $ 0.0001 | $ 0.0001 | ||
Conversion of common stock into preferred stock | 55,397 | |||
Conversion of common stock | 67,889 | |||
Preferred stock shares, designated | 10,000 | |||
Preferred stock shares, issued | 141,397 | 190,288 | ||
Preferred stock shares, outstanding | 141,397 | 190,288 | ||
Series B Convertible Preferred Stock | ||||
Preferred stock shares, authorized | 1,000 | 1,000 | ||
Preferred stock shares, par value | $ 0.0001 | $ 0.0001 | ||
Preferred stock shares, designated | 1,000 | |||
Preferred stock shares, issued | 0 | 0 | ||
Preferred stock shares, outstanding | 0 | 0 | ||
Preferred stock shares, undesignated | 9,989,000 |
Common Stock Options and Rest_3
Common Stock Options and Restricted Stock Units (RSUs) (Details) | 9 Months Ended |
Sep. 30, 2021$ / sharesshares | |
Common Stock Options and Restricted Stock Units (RSU's) | |
Number of options outstanding, beginning | 3,569,707 |
Number of options granted | 1,679,000 |
Number of options exercised | (37,645) |
Number of options cancelled or expired | (114,852) |
Number of options outstanding, ending | 3,569,707 |
Number of options outstanding, exercisable | 2,073,249 |
Weighted average exercise price outstanding, beginning | $ / shares | $ 2.13 |
Weighted average exercise price granted | $ / shares | 1.98 |
Weighted average exercise price outstanding, ending | $ / shares | 2.13 |
Weighted average exercise price outstanding, exercisable | $ / shares | $ 2.79 |
Weighted average remaining contractual term outstanding, beginning | 7 years 6 months |
Weighted average remaining contractual term outstanding, granted | 7 years 7 months 2 days |
Weighted average remaining contractual term outstanding, ending | 7 years 10 days |
Weighted average remaining contractual term outstanding, exercisable | 5 years 10 months 24 days |
Common Stock Options and Rest_4
Common Stock Options and Restricted Stock Units (RSUs) (Details 1) - $ / shares | 1 Months Ended | 9 Months Ended |
Jan. 28, 2021 | Sep. 30, 2021 | |
Granted | 22,815 | |
Restricted Stock Units | ||
Granted | 22,815 | |
Vested/released | 22,815 | |
Forfeited | 0 | |
Cancelled or expired | 0 | |
Balance outstanding, ending | 0 | |
Weighted average grant date fair value, balance outstanding, beginning | $ 0 | $ 0 |
Weighted average grant date fair value, granted | 0.70 | |
Weighted average grant date fair value, vested/released | 0 | |
Weighted average grant date fair value, forfeited | 0 | |
Weighted average grant date fair value, cancelled or expired | 0 | |
Weighted average grant date fair value, balance outstanding, ending | $ 0 |
Common Stock Options and Rest_5
Common Stock Options and Restricted Stock Units (RSUs) (Details Narrative) - USD ($) | 1 Months Ended | 9 Months Ended |
Jan. 28, 2021 | Sep. 30, 2021 | |
Restricted stock units granted | 22,815 | |
Total fair value of restricted stock unit | $ 45,858 | |
Closing price | $ 2.01 | |
Aggregate fair value of stock options granted | $ 3,511,662 | |
Discount rate | 0.00% | |
Expected dividend yield | 0.00% | |
Black-Scholes-Merton Option-Pricing Model [Member] | Minimum [Member] | ||
Volatility rate | 81.00% | |
Expected life | 8 years | |
Black-Scholes-Merton Option-Pricing Model [Member] | Maximum [Member] | ||
Volatility rate | 99.00% | |
Expected life | 10 years |
Common Stock Warrants (Details)
Common Stock Warrants (Details) - $ / shares | 1 Months Ended | 9 Months Ended |
Jan. 28, 2021 | Sep. 30, 2021 | |
Number warrants granted | 22,815 | |
Warrants | ||
Balance outstanding, beginning | 6,251,103 | 6,251,103 |
Number warrants granted | 314,291 | |
Number warrants exercised | (3,916,996) | |
Number warrants expired | (211,234) | |
Balance outstanding, ending | 2,437,164 | |
Number warrants outstanding, exercisable | 2,437,164 | |
Weighted average exercise price outstanding, beginning | $ 2.79 | $ 2.79 |
Weighted average exercise price granted | 0.88 | |
Weighted average exercise price exercised | 0.83 | |
Weighted average exercise price forfeited | 0 | |
Weighted average exercise price expired | 0 | |
Weighted average exercise price outstanding, ending | 5.54 | |
Weighted average exercise price outstanding, exercisable | $ 5.54 | |
Weighted average remaining contractual term outstanding, beginning | 2 years 9 months 14 days | |
Weighted average remaining contractual term outstanding, granted | 4 years 2 months 15 days | |
Weighted average remaining contractual term outstanding, exercised | 3 years 1 month 6 days | |
Weighted average remaining contractual term outstanding, ending | 9 months 29 days | |
Weighted average remaining contractual term outstanding, exercisable | 9 months 29 days |
Common Stock Warrants (Details
Common Stock Warrants (Details Narrative) - USD ($) | Dec. 15, 2020 | Dec. 31, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2021 |
Common stock upon the exercise of private warrants | Company’s common stock upon the exercise of Private Warrants greater than 19.99% of the number of shares outstanding prior to any such issuance | ||||
Common stock share issued upon Private Warrant exercises, Shares | 3,567,899 | ||||
Common stock shares upon cashless warrant exercise | 202,887 | ||||
Common stock share issued upon Private Warrant exercises, Amount | $ 2,785,626 | ||||
Expected dividend yield | 0.00% | ||||
Discount rate | 0.00% | ||||
Private Placements [Member] | |||||
Common stock shares exercisable | 8,958,358 | 1,910,540 | 283,337 | ||
Black-Scholes Option-Pricing Model [Member] | |||||
Expected dividend yield | 0.00% | ||||
Discount rate | 0.00% | ||||
Volatility rate | 89.00% | ||||
Expected life | 5 years | ||||
Warrants | |||||
Common stock shares exercisable | 314,291 | ||||
Exercise price | $ 0.875 | ||||
Expiration date | Dec. 15, 2025 | ||||
Fair value of warrants | $ 171,520 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Commitments and Contingencies | ||
2021 | $ 46,355 | |
2022 | 190,963 | |
2023 | 196,721 | |
2024 | 202,624 | |
2025 and beyond | 202,624 | |
Total | 839,287 | |
Less: amount representing interest | (158,761) | |
Present value of future minimum lease payments | 680,526 | |
Less: current obligations under lease | 127,696 | $ 76,480 |
Long-term lease obligations | $ 552,830 | $ 271,908 |
Commitments and Contingencies_3
Commitments and Contingencies (Details Narrative) | Jun. 11, 2021USD ($)shares | Mar. 15, 2021 | Dec. 15, 2020 | Oct. 10, 2017 | May 13, 2017USD ($)$ / sharesshares | May 12, 2017USD ($)$ / sharesshares | Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2021USD ($)ft² | Sep. 30, 2020USD ($) |
Rent expense | $ 53,263 | $ 29,581 | $ 119,802 | $ 90,484 | ||||||
January 1, 2015 [Member] | ||||||||||
Rent space | ft² | 3,657 | |||||||||
Monthly rent | $ 5,986 | |||||||||
Rent term | 60 years | |||||||||
Office lease, description | On March 15, 2021, the Company entered into an amendment to the lease, adding approximately 3,248 rentable square feet, increasing the initial monthly rent to $15,452 effective May 2021, and extending the term of the lease to December 31, 2025. | On October 10, 2017 this lease was amended increasing the rentable square feet of space to 3,950 and the monthly rent to $7,798. On July 16, 2019, the Company exercised its option to extend the lease for an additional 5 years past the initial term originally expiring on December 31, 2019. | ||||||||
Expiration date | Dec. 31, 2025 | Dec. 31, 2019 | ||||||||
Weighted-average remaining lease term | 4 years 3 months | |||||||||
Employment Agreements [Member] | Francois Michelon [Member] | ||||||||||
Annual basic salary | $ 376,991 | |||||||||
Weighted average exercise price | $ / shares | $ 4.96 | |||||||||
Employment agreement, Description | vest within 12 months will automatically vest, and upon termination without cause within 12 months | |||||||||
Options granted to purchase an aggregate of common stock | shares | 339,270 | |||||||||
Employment Agreements [Member] | Michael Thornton [Member] | ||||||||||
Annual basic salary | $ 289,963 | |||||||||
Weighted average exercise price | $ / shares | $ 4.96 | |||||||||
Employment agreement, Description | vest in three equal annual installments beginning on May 12, 2018. Upon termination without cause, any portion of Mr. Thornton’s option award scheduled to vest within 12 months | |||||||||
Options granted to purchase an aggregate of common stock | shares | 345,298 | |||||||||
Employment Agreements [Member] | David Wells [Member] | ||||||||||
Annual basic salary | $ 230,000 | |||||||||
Weighted average exercise price | $ / shares | $ 1.38 | |||||||||
Options granted to purchase an aggregate of common stock | shares | 56,000 | |||||||||
Employment Agreements [Member] | Ms. Pestrikova [Member] | ||||||||||
Annual basic salary | $ 160,000 | |||||||||
Options vested to purchase an aggregate of common stock | shares | 75,000 |