Sanara MedTech (SMTI) 10-Q 17 Aug 15 2015 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2015	Aug. 17, 2015
Principal Net of Discount
Entity Registrant Name	WOUND MANAGEMENT TECHNOLOGIES, INC.
Document Type	10-Q
Document Period End Date	Jun. 30, 2015
Amendment Flag	false
Entity Central Index Key	714,256
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		107,243,159
Entity Filer Category	Smaller Reporting Company
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Document Fiscal Year Focus	2,015
Document Fiscal Period Focus	Q2

Statement - CONSOLIDATED BALANC

Statement - CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($)	Jun. 30, 2015	Dec. 31, 2014
CURRENT ASSETS:
Cash	$ 364,497	$ 523,441
Accounts Receivable, net of allowance for bad debt of $19,395 and $18,462	208,233	278,261
Inventory, net of allowance for obsolescence of $41,717 and $46,007	524,913	402,530
Royalty receivable	100,500	0
Prepaid and Other Assets	5,995	6,295
Total Current Assets	1,204,138	1,210,527
LONG-TERM ASSETS:
Property Plant and Equipment, net of accumulated depreciation of $26,750 and $22,477	41,862	45,428
Intangible Assets, net of accumulated depreciation of $293,430 and $267,913	216,882	242,397
Total Long-Term Assets	258,744	287,825
TOTAL ASSETS	1,462,882	1,498,352
CURRENT LIABILITIES:
Accounts Payable	301,457	210,266
Accrued royalties and dividends	187,500	324,286
Capital lease obligation	4,504	4,504
Accrued Interest	195,598	181,431
Derivative Liabilities	497	1,708
Notes Payable	687,120	392,920
Convertible notes payable	0	1,200,000
Total Current Liabilities	1,376,676	2,315,115
LONG-TERM LIABILITIES
Convertible Notes Payable to Related Parties	1,200,000	0
Capital lease obligation	7,508	8,633
Total Long-Term Liabilities	1,207,508	8,633
TOTAL LIABILITIES	2,584,184	2,323,748
STOCKHOLDERS' EQUITY (DEFICIT)
Series A Preferred Stock, $10 par value, 5,000,000 shares authorized; none issued and outstanding	0	0
Series B Convertible Preferred Stock, $10 par value, 7,500 shares authorized; none issued and outstanding	0	0
Series C Convertible Preferred Stock, $10 par value, 100,000 shares authorized; 73,620 issued and outstanding as of June 30, 2015 and 70,411 issued and outstanding as of December 31, 2014	736,200	704,110
Series D Convertible Preferred Stock, $10 par value, 25,000 shares authorized; none issued and outstanding	0	0
Series E Convertible Preferred Stock, $10 par value, 5,000 shares authorized; none issued and outstanding	0	0
Common Stock: $.001 par value; 250,000,000 shares authorized; 107,246,916 issued and 107,242,827 outstanding as of June 30, 2015 and 105,447,320 issued and 105,443,231 outstanding as of December 31, 2014	107,247	105,447
Additional Paid-in Capital	44,206,556	43,820,636
Treasury Stock	(12,039)	(12,039)
Accumulated Deficit	(46,159,266)	(45,443,550)
Total Stockholders' Deficit	(1,121,302)	(825,396)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$ 1,462,882	$ 1,498,352

Statement - CONSOLIDATED BALAN3

Statement - CONSOLIDATED BALANCE SHEETS (Parenthetical) (Unaudited) - USD ($)	Jun. 30, 2015	Dec. 31, 2014
Accounts receivable, net of allowance for bad debt	$ 19,395	$ 18,462
Inventory, net of allowance for obsolescence	41,717	46,007
Property plant and equipment accumulated amortization	26,750	22,477
Intangible asset accumulated amortization	$ 293,430	$ 267,913
Preferred Stock, par value	$ 10	$ 10
Common Stock, par value	$ .001	$ .001
Common Stock, shares authorized	250,000,000	250,000,000
Common Stock, shares issued	107,246,916	105,447,320
Common Stock, shares outstanding	107,242,827	105,443,231
Series A Preferred Stock [Member]
Preferred Stock, shares authorized	5,000,000	5,000,000
Preferred Stock, shares issued	0	0
Preferred Stock, shares outstanding	0	0
Series B Preferred Stock [Member]
Preferred Stock, shares authorized	7,500	7,500
Preferred Stock, shares issued	0	0
Preferred Stock, shares outstanding	0	0
Series C Preferred Stock [Member]
Preferred Stock, shares authorized	100,000	100,000
Preferred Stock, shares issued	73,620	70,411
Preferred Stock, shares outstanding	73,620	70,411
Series D Preferred Stock [Member]
Preferred Stock, shares authorized	25,000	25,000
Preferred Stock, shares issued	0	0
Preferred Stock, shares outstanding	0	0
Series E Preferred Stock [Member]
Preferred Stock, shares authorized	5,000	5,000
Preferred Stock, shares issued	0	0
Preferred Stock, shares outstanding	0	0

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Revenues [Abstract]
REVENUES	$ 745,117	$ 544,350	$ 1,759,104	$ 1,226,644
COST OF GOODS SOLD	205,350	269,446	422,436	438,169
GROSS PROFIT	539,767	274,904	1,336,668	788,475
OPERATING EXPENSES:
General and Administrative Expenses	868,058	1,012,633	1,746,100	1,925,867
Depreciation and amortization	14,900	14,017	29,790	27,992
LOSS FROM OPERATIONS	(343,191)	(751,746)	(439,222)	(1,165,384)
OTHER INCOME (EXPENSES):
Change in fair value of derivative liabilities	(791)	18,323	(482)	49,141
Other income	6	15	15	15
Loss on Issuance of Debt for Warrants	(198,307)	0	(198,307)	0
Interest Expense	(40,037)	(42,516)	(77,720)	(205,659)
NET LOSS	(582,320)	(775,924)	(715,716)	(1,321,887)
Series C preferred stock dividends	(64,184)	(59,913)	(127,662)	(110,030)
NET LOSS AVAILABLE TO COMMON STOCKHOLDERS	$ (646,504)	$ (835,837)	$ (843,378)	$ (1,431,917)
Basic and diluted loss per share of common stock	$ (0.01)	$ (0.01)	$ (0.01)	$ (0.02)
Weighted average number of common shares outstanding	108,834,726	87,220,868	106,510,854	86,855,613

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014
Cash flows from operating activities:
Net loss	$ (715,716)	$ (1,321,887)
Adjustments to reconcile net loss to net cash used in Operating activities:
Depreciation and amortization	29,790	27,992
Amortization of discounts and deferred financing costs	0	133,907
Bad debt expense	3,437	13,765
Inventory obsolescence	0	90,978
Series D preferred shares issued for services	0	101,969
Common stock issued for services	69,810	149,769
(Gain) loss on fair market value of derivative liabilities	482	(49,141)
Loss on issuance of debt for warrants	198,307	0
Changes in assets and liabilities:
(Increase) decrease in accounts receivable	66,591	7,464
(Increase) decrease in royalties receivable	(100,500)	(13,951)
(Increase) decrease in inventory	(122,383)	(283,916)
(Increase) decrease in employee advances	0	2,082
(Increase) decrease in prepaids and other assets	300	11,867
Increase (decrease) in accrued royalties and dividends	(136,786)	(202,576)
Increase (decrease) in accounts payable	91,189	175,289
Increase (decrease) in accrued liabilities	0	666
Increase (decrease) in accrued interest payable	14,167	64,641
Net cash flows used in operating activities	(601,312)	(1,091,082)
Cash flows from investing activities:
Purchase of property and equipment	(707)	(4,689)
Net cash flows used in investing activities	(707)	(4,689)
Cash flows from financing activities:
Payments made on capital lease obligation	(1,125)	0
Borrowings on debt	96,000	0
Payments on debt	(1,800)	(21,800)
Borrowings on convertible debt to related parties	1,200,000	0
Payments on convertible debt to related parties	(1,100,000)	(44,900)
Cash proceeds from sale of series C preferred stock	250,000	2,252,510
Net cash flows provided by financing activities	443,075	2,185,810
Net increase (decrease) in cash	(158,944)	1,090,039
Cash and cash equivalents, beginning of period	523,441	45,553
Cash and cash equivalents, end of period	364,497	1,135,592
Cash paid during the period for:
Interest	64,000	7,113
Income Taxes	0	0
Supplemental non-cash investing and financing activities:
Common stock issued for conversion of debt and interest	0	93,729
Common stock issued for Series C dividends	60	0
Common stock issued for conversion of Series C Preferred Stock	9,570	0
Issuance of vested common stock	333	0
Issuance of debt for warrants	200,000	0
Forgiveness of related party convertible debt	100,000	0
Resolution of warrant derivative liabilities due to removal of convertible debt	0	918,580
Resolution of derivative liabilities due to removal of convertible debt	0	132,417
Debt discounts due to derivative liabilities	$ 0	$ 90,000

1. SUMMARY OF SIGNIFICANT ACCOU

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	6 Months Ended
	Jun. 30, 2015
Accounting Policies [Abstract]
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	Basis of Presentation The terms “WMT,” “we,” “the Company,” and “us” as used in this report refer to Wound Management Technologies, Inc. The accompanying unaudited consolidated balance sheet as of June 30, 2015 and unaudited consolidated statements of operations for the three and six months ended June 30, 2015 and 2014 have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements. In the opinion of management of WMT, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six month period ended June 30, 2015, are not necessarily indicative of the results that may be expected for the year ending December 31, 2015, or any other period. These financial statements and notes should be read in conjunction with the financial statements for each of the two years ended December 31, 2014, and December 31, 2013, included in the Company’s Annual Report on Form 10-K. The accompanying consolidated balance sheet as of December 31, 2014, has been derived from the audited financial statements filed in our Form 10-K and is included for comparison purposes in the accompanying balance sheet. Certain prior year amounts have been reclassified to conform to current year presentation. Principles of Consolidation The accompanying consolidated financial statements include the accounts of WMT and its wholly-owned subsidiaries: Wound Care Innovations, LLC a Nevada limited liability company (“WCI”); Resorbable Orthopedic Products, LLC, a Texas limited liability company (“Resorbable); and BioPharma Management Technologies, Inc., a Texas corporation (“BioPharma”). All intercompany accounts and transactions have been eliminated. Reclassification Certain prior period amounts have been reclassified to conform to current period presentation. Fair Value Measurements As defined in Accounting Standards Codification (“ASC”) Topic No. 820, fair value is 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 (exit price). The Company utilizes market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable. ASC 820 establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurement) and the lowest priority to unobservable inputs (level 3 measurement). This fair value measurement framework applies at both initial and subsequent measurement. The three levels of the fair value hierarchy defined by ASC Topic No. 820 are as follows: Level 1 – Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 1 primarily consists of financial instruments such as exchange-traded derivatives, marketable securities and listed equities. Level 2 – Pricing inputs are other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reported date. Level 2 includes those financial instruments that are valued using models or other valuation methodologies. These models are primarily industry-standard models that consider various assumptions, including quoted forward prices for commodities, time value, volatility factors, and current market and contractual prices for the underlying instruments, as well as other relevant economic measures. Substantially all of these assumptions are observable in the marketplace throughout the full term of the instrument, can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace. Instruments in this category generally include non-exchange-traded derivatives such as commodity swaps, interest rate swaps, options and collars. Level 3 – Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value. At June 30, 2015, the Company’s financial instruments consist of the derivative liabilities related to stock purchase warrants. The derivative liability on stock purchase warrants was valued using the Black-Scholes Option Pricing Model, a Level 3 input. The fair value of the conversion features associated with the convertible debt was estimated in accordance with ASC Topic No. 470-20-25-4. The change in fair value of the derivative liabilities is classified in other income (expense) in the statement of operations. Our intangible assets have also been valued using the fair value accounting treatment and a description of the methodology used, including the valuation category, is described in the Company’s Annual Report on Form 10-K.

2. GOING CONCERN

2. GOING CONCERN	6 Months Ended
	Jun. 30, 2015
Series B Preferred Stock shares authorized
GOING CONCERN	The Company has current liabilities in excess of current assets and has a stockholders’ deficiency. The Company has had limited operations and has not been able to develop an ongoing, reliable source of revenue to fund its existence. The Company’s day-to-day expenses have been covered by proceeds obtained and services paid by the issuance of stock and notes payable. The adverse effect on the Company’s results of operations due to its lack of capital resources can be expected to continue until such time as the Company is able to generate additional capital from other sources. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. These unaudited interim consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the outcome of this uncertainty. The continuation of the Company as a going concern is dependent upon the success of the Company in obtaining additional funding and the success of its future operations. The ability of the Company to achieve these objectives cannot be determined at this time.

3. NOTES PAYABLE

3. NOTES PAYABLE	6 Months Ended
	Jun. 30, 2015
NotePayableAbstract
NOTES PAYABLE	During the six months ended June 30, 2015, the Company paid a total of $1,800 to Quest Capital as part of the furniture purchase agreement in the original amount of $11,700. On May 28, 2015 the Company borrowed $96,000 under a one year non-convertible note bearing interest at 10% per annum from Mr. Doug Taylor On June 26, 2015, the Company entered into an Exchange Agreement with Tonaquint, Inc., a Utah corporation (“Tonaquint”), under which Tonaquint was issued a convertible promissory note (the “Note”) in exchange for the surrender of 500,000 common stock warrants originally issued by the Company to Tonaquint pursuant to a Securities Purchase Agreement dated June 21, 2011. The Note is in the original principal amount of $200,000, carries a 5% rate of interest, and matures on September 26, 2016. The Note provides for an initial cash installment payment of $10,000, with subsequent monthly cash installment payments beginning in December of 2015. Each such monthly installment payment may be made, at the Company's option, in shares of common stock. Subject to certain conditions, the number of shares issuable in lieu of cash installment payments is determined based on a conversion price equal to 90% of the five-day volume weighted average trading price of the Company's common stock. The surrendered warrants were accounted for as derivatives with a fair value of $1,693 on the date of the exchange. This resulted in a loss on the issuance of debt for warrants of $198,307 during the six months ended June 30, 2015.

4. STOCKHOLDERS' EQUITY

4. STOCKHOLDERS' EQUITY	6 Months Ended
	Jun. 30, 2015
Equity [Abstract]
STOCKHOLDERS' EQUITY	Preferred Stock There are currently 5,000,000 shares of Series A Preferred Stock authorized, with no shares of Series A Preferred Stock currently issued or outstanding. Effective June 24, 2010, the Company filed a Certificate of Designations, Number, Voting Power, Preferences and Rights of Series B Convertible Redeemable Preferred Stock (the “Certificate”) with the Texas Secretary of State, designating 7,500 shares of Series B Preferred Stock, par value $10.00 per share (the “Series B On October 11, 2013, the Company filed a Certificate of Designations, Number, Voting Power, Preferences and Rights of Series C Convertible Preferred Stock (the “Certificate of Designations”), under which it designated 100,000 shares of Series C Preferred Stock, par value $10.00. The Series C Preferred Stock is entitled to accruing dividends (payable, at the Company’s options, in either cash or stock) of 5% per annum until October 10, 2016, and 3% per annum until October 10, 2018. The Series C Preferred Stock is senior to the Company’s common stock and any other currently issued series of the Company’s preferred stock upon liquidation, and is entitled to a liquidation preference per share equal to the original issuance price of such shares of Series C Preferred Stock together with the amount of all accrued but unpaid dividends thereon. Each of the Series C Shares is convertible at the option of the holder into 1,000 shares of common stock as provided in the Certificate. Additionally, each holder of Series C Preferred Stock shall be entitled to vote on all matters submitted for a vote of the holders of Common Stock a number of votes equal to the number of full shares of Common Stock into which such holder’s Series C shares could then be converted. As of June 30, 2015 and December 31, 2014, there were 73,620 and 70,411 shares of Series C Preferred Stock issued and outstanding, respectively. During the six months ended June 30, 2015, the Company issued 4,166 shares of Series C preferred stock for cash proceeds of $250,000. On November 13, 2013, the Company filed a Certificate of Designations, Number, Voting Power, Preferences and Rights of Series D Convertible Preferred Stock (the “Certificate of Designations”), under which it designated 25,000 shares of Series D Preferred Stock. Shares of Series D Preferred Stock are not entitled to any preference with respect to dividend or upon liquidation, and will automatically convert (at a ratio of 1,000-to-1) into shares of the Company’s common stock, par value $0.001 upon approval of the Company’s stockholders (and filing of) and amendment to the Company’s Certificate of Incorporation increasing the number of authorized shares of Common Stock from 100,000,000 to 250,000,000. As of June 30, 2015 and December 31, 2014, there are no shares of Series D Preferred Stock issued and outstanding. On May 30, 2014, the Company filed a Certificate of Designations, Number, Voting Power, Preferences and Rights of Series E Convertible Preferred Stock (The “Certificate of Designations”), under which it designated 5,000 shares of Series E Preferred Stock. Shares of Series E Preferred Stock are not entitled to any preference with respect to dividends or upon liquidation, and will automatically convert (at a ratio of 1,000 shares of Common Stock for every one share of Series E Preferred Stock) into shares of the Company’s common stock, $0.001 par value upon approval of the Company’s stockholders (and filing of) and amendment to the Company’s Certificate of Incorporation increasing the number of authorized shares of Common Stock from 100,000,000 to 250,000,000. As of June 30, 2015 and December 31, 2014, there are no shares of Series E Preferred Stock issued and outstanding. The Series C preferred stock earned dividends of $64,184 and $127,662 for the three and six months ended June 30, 2015, respectively. As of June 30, 2015, no Series C preferred stock dividends have been declared. Common Stock On September 3, 2014, the Company held its annual meeting of stockholders. The stockholders approved an amendment to the Company’s Articles of Incorporation to increase the authorized shares of common stock of the Company from 100,000,000 to 250,000,000. On March 5, 2015, the Company granted 100,000 shares of common stock which vested immediately valued at $5,970 according to the terms of a service agreement. Under the award, the nonemployee was also granted an aggregate of 800,000 additional shares which vest in tranches of 300,000, 250,000 and 250,000 upon the achievement of certain revenue targets. No expense was recognized for these additional shares during the six months ended June 30, 2015. On March 10, 2015, the Company issued 374,264 shares of common stock in conversion of 357 shares of Series C Preferred stock and $1,036 of related dividends. On May 19, 2015, the Company granted 100,000 shares of common stock which vested immediately valued at $10,000 according to the terms of a service agreement. On May 19, 2015, the Company awarded 250,000 shares of common stock which vested immediately valued at $23,000 according to the terms of an employment agreement. On June 19, 2015, the Company issued 642,330 shares of common stock in conversion of 600 shares of Series C Preferred stock and $2,963 of related Series C dividends. During six months ended June 30, 2015, the Company recorded an aggregate of $30,840 of stock-based compensation related to the amortization of stock awards to employees and nonemployees. On May 15, 2015, the Company awarded 100,000 common to a nonemployee for services which vest after 60 days. $6,218 was expensed under this award during the six months ended June 30, 2015 which is included in the stock-based compensation of $30,840 for the period. During the six months ended June 30, 2015, the Company issued 333,334 shares of fully vested common stock under previously granted stock awards. Warrants A summary of the status of the warrants granted for the six months ended June 30, 2015, and changes during the period then ended is presented below: For the Six Months Ended June 30, 2015 Shares Weighted Average Exercise Price Outstanding at beginning of period 10,936,844 $ 0.23 Granted - - Exercised - - Forfeited (500,000 ) 0.75 Expired - - Outstanding at end of period 10,436,844 $ 0.21 As of June 30, 2015 As of June 30, 2015 Warrants Outstanding Warrants Exercisable Range of Exercise Prices Number Outstanding Weighted-Average Remaining Contract Life Weighted- Average Exercise Price Number Exercisable Weighted-Average Exercise Price $ 0.06 4,500,000 3.3 $ 0.06 4,500,000 $ 0.06 0.08 550,000 2.7 0.08 550,000 0.08 0.09 625,000 2.8 0.09 625,000 0.09 0.15 1,571,300 2.1 0.15 1,571,300 0.15 0.25 120,000 0.3 0.25 120,000 0.25 0.40 300,000 0.1 0.40 300,000 0.40 0.44 1,515,544 1.1 0.44 1,515,544 0.44 0.50 120,000 0.3 0.50 120,000 0.50 0.60 975,000 1.2 0.60 975,000 0.60 0.75 120,000 0.3 0.75 120,000 0.75 1.00 40,000 0.3 1.00 40,000 1.00 $ 0.06-1.00 10,436,844 2.3 $ 0.23 10,436,844 $ 0.21 The aggregate intrinsic value of the exercisable warrants as of June 30, 2015 was $148,925. Stock Options A summary of the status of the stock options granted for the six month period ended June 30, 2015, and changes during the period then ended is presented below: For the Six Months Ended June 30, 2015 Options Weighted Average Exercise Price Outstanding at beginning of period 3,943,500 $ 0.15 Granted 150,000 (a) Exercised - - Forfeited - - Expired - - Outstanding at end of Period 4,093,500 $ 0.15 As of June 30, 2015 As of June 30, 2015 Stock Options Outstanding Stock Options Exercisable Exercise Price Number Outstanding Weighted-Average Remaining Contract Life Weighted- Average Exercise Price Number Exercisable Weighted-Average Exercise Price $ 0.15 3,943,500 2.14 0.15 3,826,833 $ 0.15 (a) 150,000 - - - - $ 0.15 4,093,500 2.14 0.15 3,826,833 $ 0.15 (a) On January 1, 2015, the company granted three tranches of options, 25,000, 25,000, and 100,000 which vest upon meeting specific performance measures agreed upon. The measures include achieving three specific sales targets per month for 3 consecutive months. The exercise price and expiration date of each tranche will be set upon achieving the targets. As of the date of this filing the performance measures have not been met. As a result the exercise price is undetermined and these options are excluded from the calculation of weighted average remaining life. The aggregate intrinsic value of the exercisable options as of June 30, 2015 was $0.

5. DERIVATIVE LIABILITIES

5. DERIVATIVE LIABILITIES	6 Months Ended
	Jun. 30, 2015
DerivativeInstrumentsAndHedgingActivitiesAbstract
DERIVATIVE LIABILITIES	As of December 31, 2013, the Company did not have a sufficient number of common shares authorized to fulfill the possible exercise of all outstanding warrants and the conversion of all convertible notes payable. As a result, the Company determined that the warrants and the embedded conversion features of the outstanding debt instruments did not qualify for equity classification. Accordingly, the warrants and conversion features were treated as derivative liabilities and were carried at fair value. During the year ended December 31, 2014, all of the outstanding convertible notes that qualified as derivative liabilities were paid in full or converted to common stock. As of June 30, 2015, only 410,000 warrants remained as derivative liabilities due to the existence of reset provisions that qualify the instruments as derivative liabilities under FASB ASC 815. The following table sets forth the fair value hierarchy within our financial assets and liabilities by level that they were accounted for at fair value on a recurring basis as of June 30, 2015 and December 31, 2014. Fair Value Measurement at June 30, 2015 Liabilities: Carrying Value at June 30, 2015 Level 1 Level 2 Level 3 Warrant derivative liabilities $ 497 $ - $ - $ 497 Total $ 497 $ - $ - $ 497 Fair Value Measurement at December 31, 2014 Liabilities: Carrying Value at December 31, 2014 Level 1 Level 2 Level 3 $ 1,708 $ - $ - $ 1,708 Total $ 1,708 $ - $ - $ 1,708 The Company estimates the fair value of the derivative warrant liabilities by using the Black-Scholes Option Pricing Model and the derivative liabilities related to the conversion features in the outstanding convertible notes using the lack-Scholes Option Pricing Model assuming maximum value, Level 3 inputs, with the following assumptions used: Dividend yield: 0% Expected 78% to 237% Risk 0.13% to 1.07% Expected 0.58 to 2.32 The following table sets forth the changes in the fair value of derivative liabilities for the six months ended June 30, 2015: Balance, December 31, 2014 $ (1,708 ) Derivative warrants exchanged for debt 1,693 Loss on change in fair value of derivative liabilities (482 ) Balance, June 30, 2015 $ (497 ) The aggregate loss on derivative liabilities for the six months ended June 30, 2015 was $482.

6. RELATED PARTY TRANSACTIONS

6. RELATED PARTY TRANSACTIONS	6 Months Ended
	Jun. 30, 2015
Related Party Transactions
RELATED PARTY TRANSACTIONS	On June 15, 2015, the Company, together with certain of its subsidiaries, entered into a term loan agreement (the “Loan Agreement”) with The James W. Stuckert Revocable Trust (“SRT) and The S. Oden Howell Revocable Trust (“HRT”), pursuant to which SRT made a loan to the Company in the amount of $600,000 and HRT made a loan to the Company in the amount of $600,000 under Senior Secured Convertible Promissory Notes (the “Notes”). Both SRT and HRT are controlled by affiliates of the Company. The Notes each carry an interest rate of 10% per annum, and (subject to various default provisions) all unpaid principal and accrued but unpaid interest under the Notes is due and payable on June 15, 2018. The Notes may be prepaid in whole or in part upon ten days’ written notice, and all unpaid principal and accrued interest under the Notes may be converted, at the option of SRT and HRT, into shares of the Company’s Series C Convertible Preferred Stock at a conversion price of $70.00 per share at any time prior to maturity. On October 10, 2013 and October 15, 2013, the Company borrowed $1 million and $200,000 under convertible notes bearing interest at 8% per annum from Brookhaven Medical, Inc (“BMI”) where the CEO of BMI is a board member of the Company. The notes may be converted, at the option of BMI, into shares of the Company’s Series C Preferred Stock at a conversion price of $70 per share. The Company’s obligations under the first BMI Note are secured by all the assets of the Company and its subsidiaries. The notes were due on June 15, 2015. As of June 30, 2015 and December 31, 2014, the outstanding balance under the convertible notes to related party was $0 and $1,200,000, respectively. As noted in previous filings, On June 15, 2015 the Company used proceeds from The above mentioned note (with The James W. Stuckert Revocable Trust (“SRT) and The S. Oden Howell Revocable Trust (“HRT”)) to pay $1,100,000 of outstanding unpaid principal and accrued but unpaid interest under the Senior Secured Convertible Promissory Note issued to Brookhaven Medical, Inc. pursuant to a loan agreement dated October 11, 2013. The remaining $100,000 of outstanding principal was forgiven during the six months ended June 30, 2015. This forgiveness of related party debt was recognized as a capital transaction. On September 29, 2009, the Company entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”), by and among the Company, RSI-ACQ, LLC, a wholly-owned subsidiary of the Company (RSI), Resorbable Orthopedic Products, LLC (“Resorbable”) and Resorbable’s members, pursuant to which, RSI acquired substantially all of Resorbable’s assets, in exchange for (i) 500,000 shares of the Company’s common stock, and (ii) a royalty equal to eight percent (8%) of the net revenues generated from products sold by the Company or any of its affiliates, which products are developed from or otherwise utilize any of the patented technology acquired from Resorbable. The royalty is paid to Dr. Barry Constantine whom is an employee and hold the positon of Director of R&D.

7. CAPITAL LEASE OBLIGATION

7. CAPITAL LEASE OBLIGATION	6 Months Ended
	Jun. 30, 2015
Capital Lease Obligation
Capital lease obligation	In December 2014, the Company entered into a Capital Lease agreement for the purchase of a phone system. The agreement required a down payment of $2,105 and 36 monthly payments of $375. The Company recorded an asset of $13,512 and a capital lease obligation of $13,512. Aggregate payments made under the lease were $1,125 for the six months ended June30, 2015. At June 30, 2015 a total lease liability of $12,012 remained. Of that, $4,504 will be due in the next 12 months.

1. SUMMARY OF SIGNIFICANT ACC13

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	6 Months Ended
	Jun. 30, 2015
Accounting Policies [Abstract]
Basis of Presentation	The terms “WMT,” “we,” “the Company,” and “us” as used in this report refer to Wound Management Technologies, Inc. The accompanying unaudited consolidated balance sheet as of June 30, 2015 and unaudited consolidated statements of operations for the three and six months ended June 30, 2015 and 2014 have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements. In the opinion of management of WMT, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six month period ended June 30, 2015, are not necessarily indicative of the results that may be expected for the year ending December 31, 2015, or any other period. These financial statements and notes should be read in conjunction with the financial statements for each of the two years ended December 31, 2014, and December 31, 2013, included in the Company’s Annual Report on Form 10-K. The accompanying consolidated balance sheet as of December 31, 2014, has been derived from the audited financial statements filed in our Form 10-K and is included for comparison purposes in the accompanying balance sheet. Certain prior year amounts have been reclassified to conform to current year presentation.
Principles of Consolidation	The accompanying consolidated financial statements include the accounts of WMT and its wholly-owned subsidiaries: Wound Care Innovations, LLC a Nevada limited liability company (“WCI”); Resorbable Orthopedic Products, LLC, a Texas limited liability company (“Resorbable); and BioPharma Management Technologies, Inc., a Texas corporation (“BioPharma”). All intercompany accounts and transactions have been eliminated.
Reclassification	Certain prior period amounts have been reclassified to conform to current period presentation.
Fair Value Measurements	As defined in Accounting Standards Codification (“ASC”) Topic No. 820, fair value is 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 (exit price). The Company utilizes market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable. ASC 820 establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurement) and the lowest priority to unobservable inputs (level 3 measurement). This fair value measurement framework applies at both initial and subsequent measurement. The three levels of the fair value hierarchy defined by ASC Topic No. 820 are as follows: Level 1 – Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 1 primarily consists of financial instruments such as exchange-traded derivatives, marketable securities and listed equities. Level 2 – Pricing inputs are other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reported date. Level 2 includes those financial instruments that are valued using models or other valuation methodologies. These models are primarily industry-standard models that consider various assumptions, including quoted forward prices for commodities, time value, volatility factors, and current market and contractual prices for the underlying instruments, as well as other relevant economic measures. Substantially all of these assumptions are observable in the marketplace throughout the full term of the instrument, can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace. Instruments in this category generally include non-exchange-traded derivatives such as commodity swaps, interest rate swaps, options and collars. Level 3 – Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value. At June 30, 2015, the Company’s financial instruments consist of the derivative liabilities related to stock purchase warrants. The derivative liability on stock purchase warrants was valued using the Black-Scholes Option Pricing Model, a Level 3 input. The fair value of the conversion features associated with the convertible debt was estimated in accordance with ASC Topic No. 470-20-25-4. The change in fair value of the derivative liabilities is classified in other income (expense) in the statement of operations. Our intangible assets have also been valued using the fair value accounting treatment and a description of the methodology used, including the valuation category, is described in the Company’s Annual Report on Form 10-K.

4. STOCKHOLDERS EQUITY (Tables)

4. STOCKHOLDERS EQUITY (Tables)	6 Months Ended
	Jun. 30, 2015
STOCKHOLDERS' EQUITY (DEFICIT)
A Summary Of The Status Of The Warrants Granted	For the Six Months Ended June 30, 2015 Shares Weighted Average Exercise Price Outstanding at beginning of period 10,936,844 $ 0.23 Granted - - Exercised - - Forfeited (500,000 ) 0.75 Expired - - Outstanding at end of period 10,436,844 $ 0.21
Schedule of warrants by warrant price range	As of June 30, 2015 As of June 30, 2015 Warrants Outstanding Warrants Exercisable Range of Exercise Prices Number Outstanding Weighted-Average Remaining Contract Life Weighted- Average Exercise Price Number Exercisable Weighted-Average Exercise Price $ 0.06 4,500,000 3.3 $ 0.06 4,500,000 $ 0.06 0.08 550,000 2.7 0.08 550,000 0.08 0.09 625,000 2.8 0.09 625,000 0.09 0.15 1,571,300 2.1 0.15 1,571,300 0.15 0.25 120,000 0.3 0.25 120,000 0.25 0.40 300,000 0.1 0.40 300,000 0.40 0.44 1,515,544 1.1 0.44 1,515,544 0.44 0.50 120,000 0.3 0.50 120,000 0.50 0.60 975,000 1.2 0.60 975,000 0.60 0.75 120,000 0.3 0.75 120,000 0.75 1.00 40,000 0.3 1.00 40,000 1.00 $ 0.06-1.00 10,436,844 2.3 $ 0.23 10,436,844 $ 0.21
Schedule of option activity	For the Six Months Ended June 30, 2015 Options Weighted Average Exercise Price Outstanding at beginning of period 3,943,500 $ 0.15 Granted 150,000 (a) Exercised - - Forfeited - - Expired - - Outstanding at end of Period 4,093,500 $ 0.15
Schedule of options by option price range	As of June 30, 2015 As of June 30, 2015 Stock Options Outstanding Stock Options Exercisable Exercise Price Number Outstanding Weighted-Average Remaining Contract Life Weighted- Average Exercise Price Number Exercisable Weighted-Average Exercise Price $ 0.15 3,943,500 2.14 0.15 3,826,833 $ 0.15 (a) 150,000 - - - - $ 0.15 4,093,500 2.14 0.15 3,826,833 $ 0.15

5. DERIVATIVE LIABILITIES (Tabl

5. DERIVATIVE LIABILITIES (Tables)	6 Months Ended
	Jun. 30, 2015
Re-acquisition of distributorship
Schedule of financial assets and liabilities by level	Fair Value Measurement at June 30, 2015 Liabilities: Carrying Value at June 30, 2015 Level 1 Level 2 Level 3 Warrant derivative liabilities $ 497 $ - $ - $ 497 Total $ 497 $ - $ - $ 497 Fair Value Measurement at December 31, 2014 Liabilities: Carrying Value at December 31, 2014 Level 1 Level 2 Level 3 $ 1,708 $ - $ - $ 1,708 Total $ 1,708 $ - $ - $ 1,708
Fair Value Of Derivative Warrant Liabilities Using Black-Scholes Option Pricing Model	Dividend yield: 0% Expected 78% to 237% Risk 0.13% to 1.07% Expected 0.58 to 2.32
The Following Table Sets Forth The Changes In Derivative Liabilities	Balance, December 31, 2014 $ (1,708 ) Derivative warrants exchanged for debt 1,693 Loss on change in fair value of derivative liabilities (482 ) Balance, June 30, 2015 $ (497 )

3. NOTES PAYABLE (Details Narra

3. NOTES PAYABLE (Details Narrative)	6 Months Ended
	Jun. 30, 2015USD ($)
Notes Payable Details Narrative
Furniture purchase agreement note Paid	$ 1,800
Furniture purchase agreement note Original Amount	$ 11,700

4. STOCKHOLDERS EQUITY (Details

4. STOCKHOLDERS EQUITY (Details) - 6 months ended Jun. 30, 2015 - $ / shares	Total
Number Outstanding, Beginning	3,943,500
Number of Warrants Granted	150,000
Number of Warrants Exercised	0
Number of Warrants Forfeited	0
Number of Warrants Expired	0
Number Outstanding, Ending	4,093,500
Weighted Average Exercise Price Outstanding, Beginning	$ .15
Weighted Average Exercise Price Exercised	0
Weighted Average Exercise Price Forfeited	0
Weighted Average Exercise Price Expired	0
Weighted Average Exercise Price Outstanding, Ending	$ .15
Warrant
Number Outstanding, Beginning	10,936,844
Number of Warrants Granted	0
Number of Warrants Exercised	0
Number of Warrants Forfeited	(500,000)
Number of Warrants Expired	0
Number Outstanding, Ending	10,436,844
Weighted Average Exercise Price Outstanding, Beginning	$ .23
Weighted Average Exercise Price Granted	0
Weighted Average Exercise Price Exercised	0
Weighted Average Exercise Price Forfeited	.75
Weighted Average Exercise Price Expired	0
Weighted Average Exercise Price Outstanding, Ending	$ .21

4. STOCKHOLDERS EQUITY (Detai18

4. STOCKHOLDERS EQUITY (Details 1) - $ / shares	6 Months Ended
	Jun. 30, 2015	Dec. 31, 2014
Number Outstanding, Ending	4,093,500	3,943,500
Weighted Average Remaining Contract Life	2 years 1 month 20 days
Weighted Average Exercise Price	$ .15	$ .15
Number Exercisable	3,826,833
Exercisable Weighted Average Exercise Price	$ .15
0.06
Number Outstanding, Ending	4,500,000
Weighted Average Remaining Contract Life	3 years 2 months 18 days
Weighted Average Exercise Price	$ 0.06
Number Exercisable	4,500,000
Exercisable Weighted Average Exercise Price	$ 0.06
0.08
Number Outstanding, Ending	550,000
Weighted Average Remaining Contract Life	2 years 8 months 12 days
Weighted Average Exercise Price	$ 0.08
Number Exercisable	550,000
Exercisable Weighted Average Exercise Price	$ 0.08
0.09
Number Outstanding, Ending	625,000
Weighted Average Remaining Contract Life	2 years 9 months 18 days
Weighted Average Exercise Price	$ 0.09
Number Exercisable	625,000
Exercisable Weighted Average Exercise Price	$ 0.09
0.15
Number Outstanding, Ending	1,571,300
Weighted Average Remaining Contract Life	2 years 1 month 6 days
Weighted Average Exercise Price	$ 0.15
Number Exercisable	1,571,300
Exercisable Weighted Average Exercise Price	$ 0.15
0.25
Number Outstanding, Ending	120,000
Weighted Average Remaining Contract Life	3 months 18 days
Weighted Average Exercise Price	$ 0.25
Number Exercisable	120,000
Exercisable Weighted Average Exercise Price	$ 0.25
0.40
Number Outstanding, Ending	300,000
Weighted Average Remaining Contract Life	1 month 6 days
Weighted Average Exercise Price	$ 0.4
Number Exercisable	300,000
Exercisable Weighted Average Exercise Price	$ 0.4
0.44
Number Outstanding, Ending	1,515,544
Weighted Average Remaining Contract Life	1 year 1 month 6 days
Weighted Average Exercise Price	$ 0.44
Number Exercisable	1,515,544
Exercisable Weighted Average Exercise Price	$ 0.44
0.50
Number Outstanding, Ending	120,000
Weighted Average Remaining Contract Life	3 months 18 days
Weighted Average Exercise Price	$ 0.5
Number Exercisable	120,000
Exercisable Weighted Average Exercise Price	$ 0.5
0.60
Number Outstanding, Ending	975,000
Weighted Average Remaining Contract Life	1 year 2 months 12 days
Weighted Average Exercise Price	$ 0.6
Number Exercisable	975,000
Exercisable Weighted Average Exercise Price	$ 0.6
0.75
Number Outstanding, Ending	120,000
Weighted Average Remaining Contract Life	3 months 18 days
Weighted Average Exercise Price	$ 0.75
Number Exercisable	120,000
Exercisable Weighted Average Exercise Price	$ 0.75
1
Number Outstanding, Ending	40,000
Weighted Average Remaining Contract Life	3 months 18 days
Weighted Average Exercise Price	$ 1
Number Exercisable	40,000
Exercisable Weighted Average Exercise Price	$ 1
0.06-1.00
Number Outstanding, Ending	10,436,844
Weighted Average Remaining Contract Life	2 months 23 days
Weighted Average Exercise Price	$ 0.23
Number Exercisable	10,436,844
Exercisable Weighted Average Exercise Price	$ 0.23

4. STOCKHOLDERS' EQUITY (Detail

4. STOCKHOLDERS' EQUITY (Details 2) - 6 months ended Jun. 30, 2015 - $ / shares	Total
Stockholders Equity Details 2
Number Outstanding, Beginning	3,943,500
Number of Options Granted	150,000
Number of Options Exercised	0
Number of Options Forfeited	0
Number of Options Expired	0
Number Outstanding, Ending	4,093,500
Weighted Average Exercise Price Outstanding, Beginning	$ .15
Weighted Average Exercise Price Exercised	0
Weighted Average Exercise Price Forfeited	0
Weighted Average Exercise Price Expired	0
Weighted Average Exercise Price Outstanding, Ending	$ .15

4. STOCKHOLDERS' EQUITY (Deta20

4. STOCKHOLDERS' EQUITY (Details 3) - 6 months ended Jun. 30, 2015 - $ / shares	Total
Number Outstanding, Ending	4,093,500
Weighted average remaining contract life	2 years 1 month 20 days
Weighted Average Exercise Price Outstanding, Ending	$ .15
Number Options Exercisable	3,826,833
Weighted-Average Exercise Price Options Exercisable	$ .15
Stock Options
Number Outstanding, Ending	3,943,500
Weighted Average Exercise Price Outstanding, Ending	$ .15
Number Options Exercisable	3,826,833
Weighted-Average Exercise Price Options Exercisable	$ .15
January 1, 2015 Grants
Number Outstanding, Ending	150,000

4. STOCKHOLDERS EQUITY (Detai21

4. STOCKHOLDERS EQUITY (Details Narrative) - shares	Jun. 30, 2015	Dec. 31, 2014
Series C Preferred Stock [Member]
Preferred Stock, shares issued	73,620	70,411
Preferred Stock, shares outstanding	73,620	70,411
Series D Preferred Stock [Member]
Preferred Stock, shares issued	0	0
Preferred Stock, shares outstanding	0	0

5. DERIVATIVE LIABILITIES (Deta

5. DERIVATIVE LIABILITIES (Details) - USD ($)	Jun. 30, 2015	Dec. 31, 2014
Derivative Liability	$ 497	$ 1,708
Warrant
Derivative Liability	497	1,708
Level 3
Derivative Liability	497	1,708
Level 3 | Warrant
Derivative Liability		$ 1,708
Level 3 | Convertible Debt
Derivative Liability	$ 497

5. DERIVATIVE LIABILITIES (De23

5. DERIVATIVE LIABILITIES (Details 1) - 6 months ended Jun. 30, 2015	Total
Derivative Liabilities Details 1
Dividends	0.00%
Expected volatility, min	78.00%
Expected volatility, max	237.00%
Risk free interest rate, min	0.13%
Risk free interest rate, max	1.07%
Expected life (years), min	6 months 29 days
Expected life (years), max	2 years 3 months 25 days

5. DERIVATIVE LIABILITIES (De24

5. DERIVATIVE LIABILITIES (Details 2)	6 Months Ended
	Jun. 30, 2015USD ($)
Derivative Liabilities Details 2
Beginning Balance	$ (1,708)
Derivative warrants exchanged for debt	1,693
Loss on change in fair value of derivative liabilities	(482)
Ending Balance	$ (497)

5. DERIVATIVE LIABILITIES (De25

5. DERIVATIVE LIABILITIES (Details Narrative) - Jun. 30, 2015 - USD ($)	Total
Derivative Liabilities Details Narrative
Warrants remained as derivative liabilities	410,000
Aggregate loss on derivative liabilities	$ 482

6. RELATED PARTY TRANSACTIONS (

6. RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($)	Jun. 30, 2015	Dec. 31, 2014
Related Party Transactions Details Narrative
Convertible notes payable	$ 0	$ 1,200,000