Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2016 | Nov. 11, 2016 | |
Document And Entity Information | ||
Entity Registrant Name | PRESSURE BIOSCIENCES INC | |
Entity Central Index Key | 830,656 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 30,868,862 | |
Trading Symbol | PBIO | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2,016 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 41,939 | $ 116,783 |
Accounts receivable | 589,682 | 113,256 |
Inventories, net of $50,000 reserve at September 30, 2016 and December 31, 2015 | 1,008,138 | 1,038,371 |
Prepaid income taxes | 7,405 | 7,381 |
Prepaid expenses and other current assets | 179,954 | 213,926 |
Total current assets | 1,827,118 | 1,489,717 |
Investment in available-for-sale equity securities | 59,550 | 294,522 |
Property and equipment, net | 7,933 | 20,149 |
TOTAL ASSETS | 1,894,601 | 1,804,388 |
CURRENT LIABILITIES | ||
Accounts payable | 532,214 | 941,389 |
Accrued employee compensation | 185,909 | 176,009 |
Accrued professional fees and other | 690,230 | 821,088 |
Deferred revenue | 270,102 | 140,878 |
Convertible debt, net of unamortized debt discounts of $1,891,206 at September 30, 2016 and $0 at December 31, 2015 | 2,664,334 | 100,000 |
Other debt, net of unamortized discounts of $5,183 and $3,041, respectively | 242,963 | 151,628 |
Warrant derivative liability | 4,325,864 | 3,295,976 |
Conversion option derivative liability | 4,627,452 | 3,940,791 |
Total current liabilities | 13,539,068 | 9,567,759 |
LONG TERM LIABILITIES | ||
Related party convertible debt, net of unamortized debt discounts of $199,436 and $0, respectively | 91,568 | |
Convertible debt, net of unamortized debt discounts of $2,076,658 and $5,223,658, respectively | 986,843 | 177,342 |
Deferred revenue | 36,935 | 36,935 |
TOTAL LIABILITIES | 14,654,414 | 9,782,036 |
STOCKHOLDERS’ DEFICIT | ||
Common stock, $.01 par value; 100,000,000 shares authorized; 30,599,839 and 23,004,898 shares issued and outstanding on September 30, 2016 and December 31, 2015, respectively | 305,998 | 230,050 |
Warrants to acquire common stock | 5,683,897 | 5,416,681 |
Additional paid-in capital | 27,080,191 | 26,036,733 |
Accumulated other comprehensive income | (339,997) | (105,025) |
Accumulated deficit | (45,490,974) | (39,557,206) |
Total stockholders’ deficit | (12,759,813) | (7,977,648) |
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT | 1,894,601 | 1,804,388 |
Series D Convertible Preferred Stock [Member] | ||
STOCKHOLDERS’ DEFICIT | ||
Convertible Preferred Stock, value | 3 | 3 |
Series G Convertible Preferred Stock [Member] | ||
STOCKHOLDERS’ DEFICIT | ||
Convertible Preferred Stock, value | 866 | 866 |
Series H Convertible Preferred Stock [Member] | ||
STOCKHOLDERS’ DEFICIT | ||
Convertible Preferred Stock, value | 100 | 100 |
Series H2 Convertible Preferred Stock [Member] | ||
STOCKHOLDERS’ DEFICIT | ||
Convertible Preferred Stock, value | ||
Series J Convertible Preferred Stock [Member] | ||
STOCKHOLDERS’ DEFICIT | ||
Convertible Preferred Stock, value | 35 | 36 |
Series K Convertible Preferred Stock [Member] | ||
STOCKHOLDERS’ DEFICIT | ||
Convertible Preferred Stock, value | $ 68 | $ 114 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Inventories reserve | $ 50,000 | $ 50,000 |
Convertible debt, current unamortized discounts | 1,891,206 | 0 |
Other debt, unamortized discounts net | 5,183 | 3,041 |
Convertible debt related party unamortized debt discount net | 199,436 | 0 |
Convertible debt, non current unamortized discounts | $ 2,076,658 | $ 5,223,658 |
Convertible preferred stock, par value | $ 0.01 | |
Convertible preferred stock, authorized | 1,000,000 | |
Convertible preferred stock, shares issued | 1,000,000 | |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 30,599,839 | 23,004,898 |
Common stock, shares outstanding | 30,599,839 | 23,004,898 |
Series D Convertible Preferred Stock [Member] | ||
Convertible preferred stock, par value | $ .01 | $ .01 |
Convertible preferred stock, authorized | 850 | 850 |
Convertible preferred stock, shares issued | 300 | 300 |
Convertible preferred stock, shares outstanding | 300 | 300 |
Convertible preferred stock, liquidation value | $ 300,000 | $ 300,000 |
Series G Convertible Preferred Stock [Member] | ||
Convertible preferred stock, par value | $ 0.01 | $ 0.01 |
Convertible preferred stock, authorized | 240,000 | 240,000 |
Convertible preferred stock, shares issued | 86,570 | 86,570 |
Convertible preferred stock, shares outstanding | 86,570 | 86,570 |
Series H Convertible Preferred Stock [Member] | ||
Convertible preferred stock, par value | $ 0.01 | $ 0.01 |
Convertible preferred stock, authorized | 10,000 | 10,000 |
Convertible preferred stock, shares issued | 10,000 | 10,000 |
Convertible preferred stock, shares outstanding | 10,000 | 10,000 |
Series H2 Convertible Preferred Stock [Member] | ||
Convertible preferred stock, par value | $ 0.01 | $ 0.01 |
Convertible preferred stock, authorized | 21 | 21 |
Convertible preferred stock, shares issued | 21 | 21 |
Convertible preferred stock, shares outstanding | 21 | 21 |
Series J Convertible Preferred Stock [Member] | ||
Convertible preferred stock, par value | $ 0.01 | $ 0.01 |
Convertible preferred stock, authorized | 6,250 | 6,250 |
Convertible preferred stock, shares issued | 3,521 | 3,546 |
Convertible preferred stock, shares outstanding | 3,521 | 3,546 |
Series K Convertible Preferred Stock [Member] | ||
Convertible preferred stock, par value | $ 0.01 | $ 0.01 |
Convertible preferred stock, authorized | 15,000 | 15,000 |
Convertible preferred stock, shares issued | 6,816 | 11,416 |
Convertible preferred stock, shares outstanding | 6,816 | 11,416 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Revenue: | ||||
Products, services, other | $ 500,949 | $ 481,452 | $ 1,429,487 | $ 1,174,391 |
Grant revenue | 34,385 | 98,882 | 127,289 | 259,181 |
Total revenue | 535,334 | 580,334 | 1,556,776 | 1,433,572 |
Costs and expenses: | ||||
Cost of products and services | 262,894 | 209,804 | 727,698 | 575,780 |
Research and development | 268,317 | 355,574 | 925,015 | 878,899 |
Selling and marketing | 224,380 | 207,888 | 609,501 | 574,289 |
General and administrative | 231,550 | 497,796 | 1,853,010 | 2,034,040 |
Total operating costs and expenses | 987,141 | 1,271,062 | 4,115,224 | 4,063,008 |
Operating loss | (451,807) | (690,728) | (2,558,448) | (2,629,436) |
Other (expense) income: | ||||
Interest expense, net | (1,116,328) | (1,584,830) | (2,961,708) | (2,831,106) |
Other expense | (200) | (1,112) | (36,910) | |
Gain on extinguishment of embedded derivative liabilities | 1,180,251 | 2,028,324 | ||
Change in fair value of derivative liabilities | 623,128 | 437,379 | (412,500) | 38,968 |
Total other (expense) income | (493,400) | 32,800 | (3,375,320) | (800,724) |
Net loss | (945,207) | (657,928) | (5,933,768) | (3,430,160) |
Accrued dividends on convertible preferred stock | 1,711 | (21,768) | ||
Net loss applicable to common shareholders | $ (945,207) | $ (656,217) | $ (5,933,768) | $ (3,451,928) |
Net loss per share attributable to common stockholders - basic and diluted | $ (0.03) | $ (0.03) | $ (0.23) | $ (0.17) |
Weighted average common stock shares outstanding used in the basic and diluted net loss per share calculation | 29,425,362 | 20,737,827 | 26,139,740 | 19,771,323 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Comprehensive Loss | ||||
Net loss | $ (945,207) | $ (657,928) | $ (5,933,768) | $ (3,430,160) |
Other comprehensive loss | ||||
Unrealized loss on marketable securities | (22,233) | (234,972) | ||
Comprehensive loss | $ (967,440) | $ (657,928) | $ (6,168,740) | $ (3,430,160) |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (5,933,768) | $ (3,430,160) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 15,489 | 18,279 |
Accretion of interest and amortization of debt discount | 2,848,058 | 2,367,381 |
Penalty interest added to debt principal | 41,200 | |
Gain on settlement of debt | (5,044) | |
Stock-based compensation expense | 282,811 | 185,370 |
Amortization of third party fees paid in common stock and warrants | 332,700 | 173,538 |
Gain on extinguishment of embedded derivative liabilities | (2,028,324) | |
Change in fair value of derivative liabilities | 412,500 | (38,968) |
Changes in operating assets and liabilities: | ||
Accounts receivable | (476,426) | (90,800) |
Inventories | 30,233 | 41,709 |
Prepaid expenses and other assets | 33,948 | 123,808 |
Accounts payable | (409,175) | (200,969) |
Accrued employee compensation | 9,900 | 48,606 |
Deferred revenue and other accrued expenses | 80,058 | 150,581 |
Net cash used in operating activities | (2,737,516) | (2,679,949) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchases of property plant and equipment | (3,273) | (6,662) |
Net cash used in investing activities | (3,273) | (6,662) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Net proceeds from related party convertible debt | 96,667 | 6,300 |
Payments on related party debt | (12,300) | |
Net proceeds from convertible debt | 2,102,382 | 3,991,437 |
Payments on convertible debt | (2,107,065) | |
Net proceeds from non-convertible debt | 865,152 | 1,300,000 |
Payments on non-convertible debt | (781,221) | (537,641) |
Net proceeds from the issuance of common stock | 382,965 | |
Payment of prepayment penalty | (351,193) | |
Net cash provided by financing activities | 2,665,945 | 2,289,538 |
NET DECREASE IN CASH | (74,844) | (397,073) |
CASH AT BEGINNING OF YEAR | 116,783 | 473,948 |
CASH AT END OF PERIOD | 41,939 | 76,875 |
SUPPLEMENTAL INFORMATION | ||
Interest paid in cash | 1,154 | 239,389 |
Income taxes paid in cash | ||
NON CASH TRANSACTIONS: | ||
Convertible debt exchanged for common stock | 117,837 | 338,000 |
Cashless exercise of warrants | 11,100 | |
Discount due to beneficial conversion feature | 20,721 | |
Discount due to warrants issued with debt | 39,755 | |
Common stock issued with debt | 104,731 | |
Common stock issued to settle non-convertible debt | 41,200 | |
Conversion of preferred stock into common stock | 63,904 | |
Extension fees added to principal | 84,000 | |
Issuance of common stock for investment in available-for-sale equity securities | 399,547 | |
Accrued dividends on preferred stock | 21,768 | |
Unrealized loss from available-for-sale equity securities | 234,972 | 76,687 |
Debt discount from derivative liability | 1,304,049 | 5,085,536 |
Prepayment penalty and accrued interest enrolled into debt principal | $ 48,950 |
Business Overview, Liquidity an
Business Overview, Liquidity and Management Plans | 9 Months Ended |
Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business Overview, Liquidity and Management Plans | 1) Business Overview, Liquidity and Management Plans Pressure BioSciences, Inc. (we, our, the Company) is focused on solving the challenging problems inherent in biological sample preparation, a crucial laboratory step performed by scientists worldwide working in biological life sciences research. Sample preparation is a term that refers to a wide range of activities that precede most forms of scientific analysis. Sample preparation is often complex, time-consuming and, in our belief, one of the most error-prone steps of scientific research. It is a widely-used laboratory undertaking the requirements of which drive what we believe is a large and growing worldwide market. We have developed and patented a novel, enabling technology platform that can control the sample preparation process. It is based on harnessing the unique properties of high hydrostatic pressure. This process, called pressure cycling technology, or PCT, uses alternating cycles of hydrostatic pressure between ambient and ultra-high levels i.e., 35,000 pounds per square inch ( psi Our pressure cycling technology uses internally developed instrumentation that is capable of cycling pressure between ambient and ultra-high levels at controlled temperatures and specific time intervals, to rapidly and repeatedly control the interactions of bio-molecules, such as deoxyribonucleic acid ( DNA RNA ® PULSE PCT SPS In 2015, together with an investment bank, we formed a subsidiary called Pressure BioSciences Europe (PBI Europe) in Poland. We have 49% ownership interest with the investment bank retaining 51%. As of now, PBI Europe does not have any operating activities but is expected to commence operations in 2017. Therefore, we dont have control of the subsidiary and did not consolidate in our financial statements. |
Going Concern
Going Concern | 9 Months Ended |
Sep. 30, 2016 | |
Going Concern | |
Going Concern | 2) Going Concern The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. However, we have experienced negative cash flows from operations with respect to our pressure cycling technology business since our inception. As of September 30, 2016, we do not have adequate working capital resources to satisfy our current liabilities and as a result, there is substantial doubt regarding our ability to continue as a going concern. We have been successful in raising cash through debt and equity offerings in the past and as described in Note 6, we completed an over-subscribed $5.0 million debt financing on March 31, 2016 with a total amount raised of $6.3 million. We have financing efforts in place to continue to raise cash through debt and equity offerings. Management has developed a plan to continue operations. This plan includes obtaining equity or debt financing. During the nine months ended September 30, 2016 we received $3,447,166 net proceeds, in additional convertible, non-convertible debt and shares of common stock. Although we have successfully completed financings and reduced expenses in the past, we cannot assure you that our plans to address these matters in the future will be successful. We need substantial additional capital to fund normal operations in future periods. In the event that we are unable to obtain financing on acceptable terms, or at all, we will likely be required to cease our operations, pursue a plan to sell our operating assets, or otherwise modify our business strategy, which could materially harm our future business prospects. These financial statements do not include any adjustments that might result from this uncertainty. |
Interim Financial Reporting
Interim Financial Reporting | 9 Months Ended |
Sep. 30, 2016 | |
Segment Reporting [Abstract] | |
Interim Financial Reporting | 3) Interim Financial Reporting The accompanying unaudited condensed consolidated balance sheet as of December 31, 2015, which was derived from audited financial statements, and the unaudited interim condensed consolidated financial statements of Pressure BioSciences, Inc. have been prepared in accordance with accounting principles generally accepted in the United States of America (generally accepted accounting principles or GAAP) for interim financial information. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all material adjustments (consisting of only normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the three months and nine months ended September 30, 2016 are not necessarily indicative of the results that may be expected for the year ending December 31, 2016. For further information, refer to the audited consolidated financial statements and footnotes thereto included in the Companys Annual Report on Form 10-K (the Form 10-K) for the fiscal year ended December 31, 2015 as filed with the Securities and Exchange Commission on April 5, 2016. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 4) Summary of Significant Accounting Policies Principles of Consolidation The condensed consolidated financial statements include the accounts of Pressure BioSciences, Inc., and its wholly-owned subsidiary PBI BioSeq, Inc. All intercompany accounts and transactions have been eliminated in consolidation. Reclassifications Certain amounts in the 2015 consolidated financial statements have been reclassified to conform to the 2016 presentation. Use of Estimates To prepare our condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America, we are required to make significant estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. In addition, significant estimates were made in projecting future cash flows to quantify deferred tax assets, the costs associated with fulfilling our warranty obligations for the instruments that we sell, and the estimates employed in our calculation of fair value of stock options awarded and warrant derivative liability. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ from the estimates and assumptions used. Concentrations Credit Risk Our financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash, cash equivalents, and trade receivables. We have cash investment policies which, among other things, limit investments to investment-grade securities. We perform ongoing credit evaluations of our customers, and the risk with respect to trade receivables is further mitigated by the fact that many of our customers are government institutions, large pharmaceutical and biotechnology companies, and academic laboratories. The following table illustrates the level of concentration as a percentage of total revenues during the three months and nine months ended September 30, 2016 and 2015. For the Three Months Ended September 30, 2016 2015 Top Five Customers 60 % 43 % Federal Agencies 9 % 2 % For the Nine Months Ended September 30, 2016 2015 Top Five Customers 31 % 34 % Federal Agencies 3 % 14 % The following table illustrates the level of concentration as a percentage of net accounts receivable balance as of September 30, 2016 and December 31, 2015: September 30, 2016 December, 31, 2015 Top Five Customers 55 % 93 % Federal Agencies 9 % 1 % Product Supply A Massachusetts-based contract manufacturer started building the new NEP2320 Extreme Barocycler instrument in May 2016. We plan to have this manufacturer build all instruments in the future. Investment in Available-For-Sale Equity Securities As of September 30, 2016, we held 601,500 shares of common stock of Everest Investments Holdings S.A. (Everest), a Polish publicly traded company listed on the Warsaw Stock Exchange. We account for this investment in accordance with ASC 320 Investments Debt and Equity Securities Inventories Inventories are valued at the lower of cost (average cost) or market (sales price). The cost of Barocyclers consists of the cost charged by the contract manufacturer. The cost of manufactured goods includes material, freight-in, direct labor, and applicable overhead. The composition of inventory is as follows: September 30, 2016 December 31, 2015 Raw materials $ 491,254 $ 310,367 Finished goods 566,884 778,004 Inventory Reserve (50,000 ) (50,000 ) Total $ 1,008,138 $ 1,038,371 Debt Issuance Costs In April 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2015-03, Simplifying the Presentation of Debt Issuance Costs (ASU 2015-03). ASU 2015-03 requires that debt issuance costs be presented as a direct deduction from the carrying amount of the related debt liability, consistent with the presentation of debt discounts. Prior to the issuance of ASU 2015-03, debt issuance costs were required to be presented as deferred charge assets, separate from the related debt liability. ASU 2015-03 does not change the recognition and measurement requirements for debt issuance costs. The Company early-adopted ASU 2015-03 as of the end of its Fiscal 2015, and applied its provisions retrospectively. Computation of Loss per Share Basic loss per share is computed by dividing loss available to common shareholders by the weighted average number of common shares outstanding. Diluted loss per share is computed by dividing loss available to common shareholders by the weighted average number of common shares outstanding plus additional common shares that would have been outstanding if dilutive potential common shares had been issued. For purposes of this calculation, convertible preferred stock, common stock dividends, and warrants and options to acquire common stock, are all considered common stock equivalents in periods in which they have a dilutive effect and are excluded from this calculation in periods in which these are anti-dilutive to our net loss. The following table illustrates our computation of loss per share for the three months and nine months ended September 30, 2016 and 2015: For the Three Months Ended For the Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Numerator: Net loss $ (945,207 ) $ (657,928 ) $ (5,933,768 ) $ (3,430,160 ) Preferred dividends accrued 1,711 (21,768 ) Net loss applicable to common shareholders $ (945,207 ) $ (656,217 ) $ (5,933,768 ) $ (3,451,928 ) Denominator for basic and diluted loss per share: Weighted average common stock shares outstanding 29,425,362 20,737,827 26,139,740 19,771,323 Income (loss) per common share basic and diluted $ (0.03 ) $ (0.03 ) $ (0.23 ) $ (0.17 ) The following table presents securities that could potentially dilute basic loss per share in the future. For all periods presented, the potentially dilutive securities were not included in the computation of diluted loss per share because these securities would have been anti-dilutive to our net loss. The Series D Convertible Preferred Stock, Series G Convertible Preferred Stock, Series H Convertible Preferred Stock, Series J Convertible Preferred Stock and Series K Convertible Preferred Stock are presented below as if they were converted into common shares according to the conversion terms. As of September 30, 2016 2015 Stock options 5,269,250 3,201,250 Convertible debt 26,971,732 26,015,029 Common stock warrants 24,824,695 26,125,127 Convertible preferred stock: Series D Convertible Preferred Stock 750,000 750,000 Series G Convertible Preferred Stock 865,700 865,700 Series H Convertible Preferred Stock 1,000,000 1,000,000 Series H2 Convertible Preferred Stock 2,100,000 2,100,000 Series J Convertible Preferred Stock 3,521,000 3,546,000 Series K Convertible Preferred Stock 6,816,000 11,399,000 72,118,377 75,002,106 Accounting for Stock-Based Compensation Expense We maintain equity compensation plans under which incentive stock options and non-qualified stock options are granted to employees, independent members of our Board of Directors and outside consultants. We recognize stock-based compensation expense over the requisite service period using the Black-Scholes formula to estimate the fair value of the stock options on the date of grant. Determining Fair Value of Stock Option Grants Valuation and Amortization Method - The fair value of each option award is estimated on the date of grant using the Black-Scholes pricing model based on certain assumptions. The estimated fair value of employee stock options is amortized to expense using the straight-line method over the vesting period. Expected Term - The Company uses the simplified calculation of expected life, as the Company does not currently have sufficient historical exercise data on which to base an estimate of expected term. Using this method, the expected term is determined using the average of the vesting period and the contractual life of the stock options granted. Expected Volatility - Expected volatility is based on the Companys historical stock volatility data over the expected term of the award. Risk-Free Interest Rate - The Company bases the risk-free interest rate used in the Black-Scholes valuation method on the implied yield currently available on U.S. Treasury zero-coupon issues with an equivalent remaining term. Forfeitures - The Company records stock-based compensation expense only for those awards that are expected to vest. The Company estimated a forfeiture rate of 5% for awards granted based on historical experience and future expectations of options vesting. The Company used this historical rate as our assumption in calculating future stock-based compensation expense. The Company recognized stock-based compensation expense of $90,500 and $74,864 for the three months ended September 30, 2016 and 2015, respectively. The following table summarizes the effect of this stock-based compensation expense within each of the line items of our costs and expenses within our Condensed Consolidated Statements of Operations: For the Three Months Ended September 30, 2016 2015 Research and development $ 14,735 $ 18,307 Selling and marketing 9,911 13,310 General and administrative 65,854 43,247 Total stock-based compensation expense $ 90,500 $ 74,864 The Company recognized stock-based compensation expense of $282,811 and $185,370 for the nine months ended September 30, 2016 and 2015, respectively. The following table summarizes the effect of this stock-based compensation expense within each of the line items of our costs and expenses within our Condensed Consolidated Statements of Operations: For the Nine Months Ended September 30 2016 2015 Research and development $ 50,766 $ 41,172 Selling and marketing 32,404 27,386 General and administrative 199,641 116,812 Total stock-based compensation expense $ 282,811 $ 185,370 Fair Value of Financial Instruments Due to their short maturities, the carrying amounts for cash and cash equivalents, accounts receivable, accounts payable, and accrued expenses approximate their fair value. Long-term liabilities are primarily related to convertible debentures and deferred revenue with carrying values that approximate fair value. Fair Value Measurements The Company follows the guidance of FASB ASC Topic 820, Fair Value Measurements and Disclosures The Company generally defines fair value 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 (exit price). The Company uses a three-tier fair value hierarchy, which classifies the inputs used in measuring fair values. 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; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring the Company to develop its own assumptions. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company has determined that its financial assets are classified within Level 1 and its financial liabilities are currently classified within Level 3 in the fair value hierarchy. The development of the unobservable inputs for Level 3 fair value measurements and fair value calculations are the responsibility of the Companys management. The following tables set forth the Companys financial assets and liabilities that were accounted for at fair value on a recurring basis as of September 30, 2016: Fair value measurements at September 30, 2016 using: September 30, 2016 Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Available-For-Sale Equity Securities $ 59,550 $ 59,550 $ - $ - Total Financial Assets $ 59,550 $ 59,550 $ - $ - September 30, 2016 Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Series D Preferred Stock Purchase Warrants $ 189,884 $ $ $ 189,884 Warrants Issued with Convertible Debt 4,135,980 4,135,980 Conversion Option Derivative Liabilities 4,627,452 4,627,452 Total Derivatives $ 8,953,316 $ $ $ 8,953,316 The following table provides a summary of the changes in fair value, including net transfers in and/or out, of the derivative financial instruments, measured at fair value on a recurring basis using significant unobservable inputs for the nine months ended September 30, 2016: December 31,2015 Issuance fair value Change in fair value Gain on extinguishment of derivative liabilities September 30, 2016 Available-For-Sale Equity Securities $ 294,522 $ - $ (234,972 ) $ $ 59,550 Total Financial Assets $ 294,522 $ $ (234,972 ) $ $ 59,550 December 31, 2015 Issuance fair value Change in fair value September 30, 2016 Series D Preferred Stock Purchase Warrants $ 173,526 $ $ 16,358 $ 189,884 Convertible Debt Warrants 3,122,450 1,094,432 (80,902 ) 4,135,980 Conversion Option Liabilities 3,940,791 1,547,127 (860,466 ) 4,627,452 Total Derivatives $ 7,236,767 $ 2,641,559 $ (925,010 ) $ 8,953,316 The amounts above valued at issuance includes $1,337,510 that was charged directly to change in fair value of derivative liabilities at issuance. The following tables set forth the Companys financial assets and liabilities that were accounted for at fair value on a recurring basis as of December 31, 2015: Fair value measurements at December 31, 2015 using: December 31, 2015 Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Available-For-Sale Equity Securities $ 294,522 $ 294,522 $ $ Total Financial Assets $ 294,522 $ 294,522 $ $ December 31, 2015 Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Series D Preferred Stock Purchase Warrants $ 173,526 $ $ $ 173,526 Warrants Issued with Convertible Debt 3,122,450 3,122,450 Conversion Option Derivative Liabilities 3,940,791 3,940,791 Total Derivatives $ 7,236,767 $ $ $ 7,236,767 The assumptions for the binomial pricing model are represented in the table below for the warrants issued in the Series D private placement reflected on a per share common stock equivalent basis. Assumptions November 10, 2011 Warrants revalued at December 31, 2015 Warrants revalued at September 30, 2016 Expected life (in months) 60.0 11.0 8.0 Expected volatility 104.5 % 104.9 % 92.4 % Risk-free interest rate 0.875 % 0.65 % 0.45 % Exercise price $ 0.81 $ 0.25 $ 0.25 Fair value per warrant $ 0.54 $ 0.16 $ 0.18 The assumptions for the binomial pricing model are represented in the table below for the warrants issued with the Convertible Debt throughout the period reflected on a per share common stock equivalent basis. Assumptions At Issuance Fair value Warrants revalued at December 31, 2015 Warrants revalued at September 30, 2016 Expected life (in months) 36.0-60.0 55.0-60.0 46.0-54.0 Expected volatility 114.3 - 138.3 % 136.3-141.6 % 116.2 -137.4 % Risk-free interest rate 0.86-1.69 % 1.29-1.76 % 1.01 % Exercise price $ 00.40-$0.42 0.40 $ 0.40 Fair value per warrant $ 0.19-$0.40 0.30 $ 0.30-$1.35 The assumptions for the binomial pricing model are represented in the table below for the conversion options reflected on a per share common stock equivalent basis. Assumptions At Issuance fair value Conversion options revalued at December 31, 2015 Conversion options revalued at September 30, 2016 Expected life (in months) 3-24 18-24 10-18 Expected volatility 97.6-153.8 % 112.2-114.7 % 94.3%-96.6 % Risk-free interest rate 0.37-0.99 % 1.06 % 0.59-0.77 % Exercise price $ 0.24-$0.45 $ 0.28 $ 0.28 Fair value per conversion option $ 0.07-$0.30 $ 0.14-$0.33 $ 0.17-$0.21 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 5) Commitments and Contingencies Operating Leases Our corporate offices are currently located at 14 Norfolk Avenue, South Easton, Massachusetts 02375. We are currently paying $4,800 per month, on a lease extension, signed on December 29, 2015, that expires December 31, 2016, for our corporate office. On November 1, 2014 we signed a lease for lab space in Medford, MA. We subsequently expanded our space in Medford. The lease expires December 30, 2017 and requires monthly payments of $5,385 subject to annual cost of living increases. Rental costs are expensed as incurred. During the nine months ended September 30, 2016 and 2015 we incurred $108,038 and $73,775 in rent expense, respectively for the use of our corporate office and research and development facilities. Government Grants We have received a $1.05 million NIH SBIR Phase II Grant. Under the grant, the NIH has committed to pay the Company to develop a high-throughput, high pressure-based DNA Shearing System for Next Generation Sequencing and other genomic applications. The grant terminates in November 2017. |
Convertible Debt and Other Debt
Convertible Debt and Other Debt | 9 Months Ended |
Sep. 30, 2016 | |
Debt Disclosure [Abstract] | |
Convertible Debt and Other Debt | 6) Convertible Debt and Other Debt Senior Secured Convertible Debentures and Warrants We entered into Subscription Agreements (the Subscription Agreement Purchaser Debentures Warrants Purchase Price The Company issued a principal aggregate amount of $6,962,504 in Debentures which includes a 10% original issue discount on the Purchase Price. The Debenture does not accrue any additional interest during the first year it is outstanding but accrues interest at a rate equal to 10% per annum for the second year it is outstanding. The Debenture has a maturity date of two years from issuance. The Debenture is convertible any time after its issuance date. The Purchaser has the right to convert the Debenture into shares of the Companys common stock at a fixed conversion price equal to $0.28 per share, subject to applicable adjustments. In the second year that the Debenture is outstanding, any interest accrued shall be payable quarterly in either cash or common stock, at the Companys discretion. At any time after the Issuance Date, the Company has the option, subject to certain conditions, to redeem some or all of the then outstanding principal amount of the Debenture for cash in an amount equal to the sum of (i) 120% of the then outstanding principal amount of the Debenture, (ii) accrued but unpaid interest and (iii) any liquidated damages and other amounts due in respect of the Debenture. The Company issued warrants exercisable into a total of 11,302,766 shares of our common stock. The Warrants issued in this transaction are immediately exercisable at an exercise price of $0.40 per share, subject to applicable adjustments including full ratchet anti-dilution in the event that we issue any securities at a price lower than the exercise price then in effect. The Warrants have an expiration period of five years from the original issue date. The Warrants are subject to adjustment for stock splits, stock dividends or recapitalizations and also include anti-dilution price protection for subsequent equity sales below the exercise price. Subject to the terms and conditions of the Warrants, at any time commencing six months from the Final Closing, the Company has the right to call the Warrants for cancellation if the volume weighted average price of its Common Stock on the OTC QB Market (or other primary trading market or exchange on which the Common Stock is then traded) equals or exceeds three times the per share exercise price of the Warrants for 15 out of 20 consecutive trading days. In connection with the Subscription Agreement and Debenture, the Company entered into Security Agreements with the Purchasers whereby the Company agreed to grant to Purchasers an unconditional and continuing, first priority security interest in all of the assets and property of the Company to secure the prompt payment, performance and discharge in full of all of Companys obligations under the Debentures, Warrants and the other Transaction Documents. The Company determined that the conversion feature of the Debentures met the definition of a liability in accordance with ASC 815-40 and therefore bifurcated the conversion feature on each debt agreement and accounted for it as a derivative liability. The fair value of the conversion feature was accounted for as a note discount and are amortized to interest expense over the life of the loan. The fair value of the conversion feature was reflected in the conversion option liability line in the condensed consolidated balance sheets. The proceeds from these convertible debts were allocated between the host debt instrument and the convertible option based on the residual method. The estimated fair value of the convertible option was determined using a binomial formula, resulting in allocations to the convertible option and accounted for as a liability in the Companys condensed consolidated balance sheet. In accordance with the provisions of ASC 815-40, the gross proceeds are offset by debt discounts, which are amortized to interest expense over the expected life of the debt. ASC 470-20 states that the proceeds from the issuance of debt with detachable stock warrants should be allocated between the debt and warrants on the basis of their relative fair market values. The debt discount will be amortized to interest expense over the two year term of these loans. We amortized $2,768,527 of the debt discount to interest expense in 2016. The warrants issued in connection with the convertible debentures are classified as warrant derivative liabilities because the warrants are entitled to certain rights in subsequent financings and the warrants contain down-round protection and therefore, do not meet the scope exception for treatment as a derivative under ASC 815, Derivatives and Hedging, (ASC 815). Since down-round protection is not an input into the calculation of the fair value of the warrants, the warrants cannot be considered indexed to the Companys own stock which is a requirement for the scope exception as outlined under ASC 815. The estimated fair value of the warrants was determined using the binomial model, resulting in an allocation of $2,847,624 to the total warrants out of the gross proceeds of $6,329,549. The fair value will be affected by changes in inputs to that model including our stock price, expected stock price volatility, the contractual term, and the risk-free interest rate. We will continue to classify the fair value of the warrants as a liability until the warrants are exercised, expire or are amended in a way that would no longer require these warrants to be classified as a liability, whichever comes first. Other convertible notes On May 13, 2016, one lender converted an outstanding note issued on April 28, 2015 and the related accrued interest totaling $117,837 to 420,849 common shares. As of September 30, 2016, the outstanding balance on the note was zero. On May 24, we sold an additional convertible note for $107,000 with warrants to purchase 50,000 shares of common stock at an exercise price of $0.55 per share. The purchaser has the right to convert the notes into shares of the Companys common stock at a fixed conversion price equal to $0.45 per share, subject to applicable adjustments. The estimated fair value of the warrants was determined using the binomial model, resulting in an allocation of $12,406 to the total warrants and the recognition of a beneficial conversion feature of $7,962, both of which were recorded as a discount to the note. We evaluated the convertible note and warrants for derivative liability treatment and determined that these instruments do not include certain rights such as price protection like our previous debt financings. Accordingly, we concluded that this financing arrangement did not qualify for derivative accounting treatment. On June 14, 2016, we sold an additional convertible note for $115,000 and issued 30,667 common shares to compensate the lender. On July 1, 2016, the note was modified to increase the principal amount to $200,000 and we received the remaining proceeds of $85,000 on the same date and issued 34,333 common shares as compensation to the lender. The lender has the right to convert the note into shares of the Companys common stock at fixed conversion price equal to $0.45 per share, subject to applicable adjustments. We valued the total 65,000 common shares using the stock prices at the respective dates the note proceeds were received and recorded the relative fair value of the shares amounting to $26,000 as a debt discount to be amortized over the term of the loan. We then computed the effective conversion price of the note, noting that no beneficial conversion feature exists. We also evaluated the convertible note for derivative liability treatment and determined that the instrument does not include certain rights such as price protection like our previous debt financing. Accordingly, we concluded that this financing arrangement did not qualify for derivative accounting treatment. On July 29, 2016, we sold an additional convertible note for $100,000 and issued 32,500 common shares to compensate the lender. The lender has the right to convert the notes into shares of the Companys common stock at a fixed conversion price equal to $0.45 per share, subject to applicable adjustments. The proceeds were allocated between the convertible note and shares of common stock based on their relative fair values. The relative fair values of the convertible note and the common shares was $87,241 and $12,759, respectively. We then computed the effective conversion price of the note, noting that the convertible debt gave rise to a beneficial conversion feature (BCF) of $12,759. The sum of the relative fair value of the common shares and the BCF of $25,518 was recorded as a debt discount to be amortized over the term of the loan. We also evaluated the convertible note for derivative liability treatment and determined that the instruments does not include certain rights such as price protection like our previous debt financings. Accordingly, we concluded that this financing arrangements did not qualify for derivative accounting treatment. On September 15, 2016, we sold an additional convertible note for $500,000 and issued 200,000 common shares to compensate the lender. The lender has the right to convert the notes into shares of the Companys common stock at a fixed conversion price equal to $0.45 per share, subject to applicable adjustments. The convertible note includes an original issue discount of $40,541 and is subject to annual interest of 9%. The proceeds were allocated between the convertible note and shares of common stock based on their relative fair values. The relative fair value of the convertible note was $434,028. The allocation of the gross proceeds to the shares of common stock was $65,972 and recorded as a debt discount to be amortized over the term of the loan. We then computed the effective conversion price of the note, noting that no beneficial conversion feature exists. We also evaluated the convertible note for derivative liability treatment and determined that the instrument does not include certain rights such as price protection like our previous debt financings. Accordingly, we concluded that this financing arrangement did not qualify for derivative accounting treatment. The specific terms of the convertible debts and outstanding balances as of September 30, 2016 are listed in the table below. Fixed Rate Convertible Notes Inception Date Term Loan Amount Outstanding Balance Original Issue Discount Interest Rate Deferred Finance Fees Discount related to fair value of conversion feature and warrants/shares July 22, 2015 24 months $ 2,180,000 $ 2,180,000 $ 218,000 1 10 % 2 $ 388,532 $ 2,163,074 September 25, 2015 24 months 1,100,000 1,100,000 110,000 1 10 % 2 185,956 1,022,052 October 2, 2015 24 months 150,000 150,000 15,000 1 10 % 2 26,345 140,832 October 6, 2015 24 months 30,000 30,000 3,000 1 10 % 2 5,168 26,721 October 14, 2015 24 months 50,000 50,000 5,000 1 10 % 2 8,954 49,377 November 2, 2015 24 months 250,000 250,000 25,000 1 10 % 2 43,079 222,723 November 10, 2015 24 months 50,000 50,000 5,000 1 10 % 2 8,790 46,984 November 12, 2015 24 months 215,000 215,000 21,500 1 10 % 2 38,518 212,399 November 20, 2015 24 months 200,000 200,000 20,000 1 10 % 2 37,185 200,000 December 4, 2015 24 months 170,000 170,000 17,000 1 10 % 2 37,352 170,000 December 11, 2015 24 months 360,000 360,000 36,000 1 10 % 2 75,449 360,000 December 18, 2015 24 months 55,000 55,000 5,500 1 10 % 2 11,714 55,000 December 31, 2015 24 months 100,000 100,000 10,000 1 10 % 2 20,634 100,000 January 11, 2016 24 months 100,000 100,000 10,000 1 10 % 2 24,966 80,034 January 20, 2016 24 months 50,000 50,000 5,000 1 10 % 2 9,812 40,188 January 29, 2016 24 months 300,000 300,000 30,000 1 10 % 2 60,887 239,113 February 26, 2016 24 months 200,000 200,000 20,000 1 10 % 2 43,952 156,048 March 10, 2016 24 months 125,000 125,000 12,500 1 10 % 2 18,260 106,740 March 18, 2016 24 months 360,000 360,000 36,000 1 10 % 2 94,992 265,008 March 24, 2016 24 months 106,667 106,667 10,667 1 10 % 2 15,427 91,240 March 31, 2016 24 months 167,882 167,882 16,788 1 10 % 2 2,436 165,446 April 5, 2016 24 months 10,000 10,000 1,000 1 10 % 2 - 10,000 May 24, 2016 7 months 100,000 100,000 7,000 0 % - 20,368 June 15, 2016 6 months 40,000 40,000 - 12 % - 3,680 June 17, 2016 6 months 40,000 40,000 - 12 % - 3,899 June 22, 2016 6 months 35,000 35,000 - 12 % - 3,373 July 6, 2016 6 months 85,000 85,000 - 12 % - 15,048 July 29, 2016 6 months 100,000 100,000 - 12 % - 25,518 September 15, 2016 8 months 500,000 500,000 40,541 9 % - 65,972 $ 7,229,549 $ 7,229,549 $ 680,496 $ 1,158,408 $ 6,060,837 1 The original issue discount is reflected in the first year. 2 The annual interest starts accruing in the second year. The closings above on March 10, 24, and 31, 2016 included $264,667 of proceeds received from related parties. At any time after six months from the Inception Date, the Company has the right to prepay the above Debentures in cash for 120% of the principal amount outstanding and any accrued interest. As of September 30, 2016, a total of approximately $291,000 convertible debentures were purchased by related parties who were members of the Companys Board of Directors. The following table provides a summary of the changes in convertible debt, net of unamortized discount, during 2016: 2016 Balance at January 1, $ 277,342 Issuance of convertible debt, face value 2,509,045 Original issue discount (189,496 ) Debt discount from derivative liabilities (embedded conversion option and warrants) (1,153,817 ) Debt discount from shares and warrants issued with the notes (117,137 ) Debt discount from beneficial conversion feature (20,721 ) Deferred financing fees (270,732 ) Conversion of debentures to common shares (100,000) Accretion of interest and amortization of debt discount to interest expense through September 30, 2,808,261 Balance at September 30, 3,742,745 Less: current portion 2,664,334 Convertible debt, long-term portion $ 1,078,411 Other Notes On January 6, 2016 we signed a Merchant Agreement with a lender. Under the agreement we received $250,000 in exchange for rights to all customer receipts until the lender is paid $322,500, which is collected at the rate of $1,280 per business day. The payments were secured by second position rights to all customer receipts until the loan has been paid in full. $138,840 of the proceeds were used to pay off the outstanding balance of a previous loan from another lender. The Company recognized a gain on the settlement of the previous loan of $5,044 which was credited to interest expense. The Company paid $2,500 in fees in connection with this loan. We received an additional $93,161 in June 2016 under the existing Merchant Agreement. The note was still outstanding as of September 30, 2016 with a balance of $105,125. On January 20, 2016, we borrowed $50,000 from an individual with no interest or fees. We paid back the loan in March 2016. On February 8, 2016 we signed a Merchant Agreement with a lender. Under the agreement we received $100,000 in exchange for third position rights to all customer receipts until the lender is paid $129,900, which is collected at the rate of $927 per business day. The Company paid $2,000 in fees in connection with this loan. We received an additional $125,000 in June 2016 under the existing Merchant Agreement of which $48,420 was used to pay off the prior loan. The note was still outstanding as of September 30, 2016 with a balance of $4,620 after payments of $56,841. The lender provided an additional $70,000 on August 16, 2016. We repaid a portion of the $70,000 with $49,200 remaining as outstanding as of September 30, 2016. On May 9, 2016 we signed a promissory note with a lender. Under the agreement we received $200,000 net of a $6,000 original issue discount and we repaid $206,000 on August 25, 2016. In connection with this promissory note, we issued warrants exercisable into 100,000 shares of our common stock. The warrants issued in this transaction are immediately exercisable at an exercise price of $0.55 per share. The warrants have an expiration period of three years from the original issue date. The warrants are subject to adjustment for stock splits, stock dividends or recapitalizations. The warrants were recorded as a component of our Stockholders Equity. The estimated fair value of the warrants was determined using the binomial model, resulting in an allocation of $27,349 to the total warrants and recorded as a discount to the note to be amortized over the term of the loan. We evaluated the warrants for derivative liability treatment and determined that these instruments do not include certain rights such as price protection like our previous debt financings. Accordingly, we concluded that these instruments did not qualify for derivative accounting treatment. In August, 2016, the lender extended the maturity date of the note from August 11, 2016 to August 25, 2016. Consequently, a penalty interest of $41,200 was added to the principal amount and settled through the issuance of 100,049 common shares. As of September 30, 2016, the outstanding balance on this note was zero. On August 26, 2016 we signed a Merchant Agreement with a lender. Under the agreement we received $122,465 net proceeds in exchange for rights to all customer receipts which is collected at the rate of $1,386 per business day. The note was still outstanding as of September 30, 2016 with a balance of $89,201. |
Stockholders' Deficit
Stockholders' Deficit | 9 Months Ended |
Sep. 30, 2016 | |
Equity [Abstract] | |
Stockholders' Deficit | 7) Stockholders Deficit Preferred Stock We are authorized to issue 1,000,000 shares of preferred stock with a par value of $0.01. Of the 1,000,000 shares of preferred stock: 1) 20,000 shares have been designated as Series A Junior Participating Preferred Stock ( Junior A 2) 313,960 shares have been designated as Series A Convertible Preferred Stock ( Series A 3) 279,256 shares have been designated as Series B Convertible Preferred Stock ( Series B 4) 88,098 shares have been designated as Series C Convertible Preferred Stock ( Series C 5) 850 shares have been designated as Series D Convertible Preferred Stock ( Series D 6) 500 shares have been designated as Series E Convertible Preferred Stock (Series E) 7) 240,000 shares have been designated as Series G Convertible Preferred Stock ( Series G 8) 10,000 shares have been designated as Series H Convertible Preferred Stock ( Series H 9) 21 shares have been designated as Series H2 Convertible Preferred Stock ( Series H2 10) 6,250 shares have been designated as Series J Convertible Preferred Stock ( Series J 11) 15,000 shares have been designated as Series K Convertible Preferred Stock ( Series K As of September 30, 2016, there were no shares of Junior A, and Series A, B, C and E issued and outstanding. See our Annual Report on Form 10-K for the year ended December 31, 2015 for the pertinent disclosures of preferred stock. Stock Options and Warrants Our stockholders approved our amended 2005 Equity Incentive Plan (the Plan) pursuant to which an aggregate of 1,800,000 shares of our common stock were reserved for issuance upon exercise of stock options or other equity awards made under the Plan. Under the Plan, we may award stock options, shares of common stock, and other equity interests in the Company to employees, officers, directors, consultants, and advisors, and to any other persons the Board of Directors deems appropriate. As of September 30, 2016, options to acquire 1,153,750 shares were outstanding under the Plan with 646,250 shares available for future grant under the Plan. On December 12, 2013 at the Companys special meeting the shareholders approved the 2013 Equity Incentive Plan (the 2013 Plan) pursuant to which 3,000,000 shares of our common stock were reserved for issuance upon exercise of stock options or other equity awards. Under the 2013 Plan, we may award stock options, shares of common stock, and other equity interests in the Company to employees, officers, directors, consultants, and advisors, and to any other persons the Board of Directors deems appropriate. As of September 30, 2016 a total of 2,047,500 options have been granted under the 2013 Plan with 952,500 shares available for future grants. On November 29, 2015 the Companys Board of Directors adopted the 2015 Nonqualified Stock Option Plan (the 2015 Plan) pursuant to which 5,000,000 shares of our common stock were reserved for issuance upon exercise of non-qualified stock options. Under the 2015 Plan, we may award non-qualified stock options in the Company to employees, officers, directors, consultants, and advisors, and to any other persons the Board of Directors deems appropriate. As of September 30, 2016, non-qualified options to acquire 2,068,000 shares were outstanding under the Plan with 2,932,000 shares available for future grants under the 2015 Plan. All of the outstanding non-qualified options had an exercise price that was at or above the Companys common stock share price on September 30, 2016. The following tables summarize information concerning options and warrants outstanding and exercisable: Stock Options Warrants Weighted Weighted Average Average Total Shares Price per share Shares Price per share Shares Exercisable Balance outstanding, 01/01/15 3,406,250 $ 0.51 19,182,201 $ 0.49 22,588,451 16,611,528 Granted 2,500,000 0.40 10,837,141 0.40 13,337,141 Exercised Expired (205,000 ) 1.00 (791,678 ) 0.31 (996,678 ) Forfeited (130,000 ) 0.70 (130,000 ) Balance outstanding, 12/31/15 5,571,250 $ 0.44 29,227,664 $ 0.44 34,798,914 31,664,469 Granted 4,294,552 0.43 4,294,552 Exercised (70,000 ) 0.31 (70,000 ) Expired (186,000 ) 1.00 (8,627,521 ) 0.61 (8,813,521 ) Forfeited (116,000 ) 0.51 (116,000 ) Balance outstanding, 9/30/2016 5,269,250 $ 0.42 24,824,695 $ 0.39 30,093,945 28,095,959 Options Outstanding Options Exercisable Weighted Average Weighted Average Range of Exercise Prices Number of Options Remaining Contractual Life (Years) Exercise Price Number of Options Remaining Contractual Life (Years) Exercise Price $0.30 - $0.39 1,625,500 8.0 $ 0.30 1,248,514 8.0 $ 0.30 0.40 - 0.49 2,786,000 9.0 0.40 1,165,000 8.6 0.40 0.50 - 0.59 226,250 5.9 0.50 226,250 5.9 0.50 0.60 - 0.69 385,500 3.4 0.60 385,500 3.4 0.60 0.70 - 1.25 246,000 2.6 1.00 246,000 2.6 1.00 $0.30 - $1.25 5,269,250 7.8 $ 0.42 3,271,264 7.1 $ 0.44 As of September 30, 2016, the total estimated fair value of unvested stock options to be amortized over their remaining vesting period was $459,724. The non-cash, stock-based compensation expense associated with the vesting of these options is expected to be $90,445 for the remainder of 2016, $212,957 in 2017 and $156,322 in 2018. Common Stock Issuances On April 22, 2016, we issued 22,996 shares of common stock in connection with a cashless exercise of 70,000 warrants. On May 6, 2016, all remaining Series K preferred shareholders except one converted 4,600 shares of preferred stock into approximately 4.6 million shares of the Companys common stock. The Company issued 247,435 shares of common stock to pay the accrued dividend of $63,413 on Series K preferred stock. On May 13, 2016, we issued 420,849 shares of common stock to convert $117,837 of convertible note principal and related interest. See Note 6 On various dates from January to September 2016, we issued a total of 297,500 shares of common stock in connection with the convertible notes issued to lenders. We also issued 100,049 shares of common stock to settle debt of $41,200. See Note 6. On August 29, 2016, a Series J preferred shareholder converted 25 shares of preferred stock into 25,000 shares of the Companys common stock. The Company issued 1,112 shares of common stock to pay the accrued dividend of $445 on Series J preferred stock. On various dates from January to September 2016 the Company issued 755,000 shares of restricted common stock to investor relations firms for services rendered. Sale of Common Stock On August 29, September 9 and September 14, 2016, we completed private placements, pursuant to which we sold an aggregate of 1,125,000 shares of common stock, $0.01 par value, for a purchase price of $0.40 per share, resulting in gross proceeds to us of approximately $450,000. The shares were issued and sold to a total of 2 accredited investors pursuant to a securities purchase agreement entered into as of August 29, 2016. The investors received warrants to purchase 1,125,000 shares of the Companys common stock at $0.50 exercise price. The warrants expire 5 years after issuance. We also incurred stock issuance costs related to broker and legal fees of $67,035 which were charged to additional paid in capital. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | 8) Subsequent Events On October 11 and November 10, 2016, we completed two additional tranches of the Fall 2016 Private Placement, pursuant to which we sold an aggregate of 400,000 shares of common stock, $0.01 par value, for a purchase price of $0.40 per share, resulting in gross proceeds to us of approximately $160,000. The Shares were issued and sold to a total of 2 accredited investors pursuant to a Securities Purchase Agreement entered into as of the date of their investments. The investors received warrants to purchase a total of 400,000 shares of the Companys common stock at an exercise price of $0.50. The warrants expire 5 years after issuance. On October 28, 2016, an accredited investor (the Investor) purchased a promissory note in the aggregate principal amount of up to $2,000,000 (the Note) due and payable on the earlier of October 28, 2017 or on the seventh business day after the closing of a Qualified Offering (as defined in the Note). Although the Note is dated October 26, 2016, the transaction did not close until October 28, 2016, when the Company received its initial $250,000 advance pursuant to the Note. As a result, on the same day and pursuant to the Note, the Company issued to the Investor a Common Stock Purchase Warrant to purchase 625,000 shares of the Companys common stock (Common Stock) at an exercise price per share equal to $0.40 per share. The Investor is obligated to provide the Company $250,000 advances under the Note, but the Investor shall not be required to advance more than $250,000 in any individual fifteen (15) day period and no more than $500,000 in the thirty (30) day period immediately following the date of the initial advance. Notwithstanding the fifteen (15) day period limitation, on November 2, 2016, the Company received a second $250,000 advance pursuant to the Note and the Company issued to the Investor the second warrant to purchase 625,000 shares of the Common Stock. The terms of the first and second warrants are identical except for the exercise date, issue date, and termination date. Interest on the principal balance of the Note shall be paid in full on the Maturity Date, unless otherwise paid prior to the Maturity Date. Interest shall be assessed as follows: (i) 10% on all principal amounts advanced prior to April 28, 2017; (ii) the foregoing and 4% on any amount remaining outstanding if the principal amount is repaid between April 28, 2017 and July28, 2017; or (iii) both of the foregoing and 4% on any amount remaining outstanding if the principal amount is repaid between July 28, 2017 and October 28, 2017. Our placement agent is being paid eight percent (8%) of all principal amounts advanced in connection with this transaction. On November 1, 2016, we signed a consulting agreement with an investor relations firm for a twelve month period with a six-month cancellation clause. In connection with this agreement, we issued a warrant exercisable at $0.40 per share for 660,000 shares of our common stock. Of these shares, 330,000 vest immediately and 330,000 shares vest 181 days after November 1, 2016. The warrant expires five years from issuance. |
Summary of Significant Accoun15
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The condensed consolidated financial statements include the accounts of Pressure BioSciences, Inc., and its wholly-owned subsidiary PBI BioSeq, Inc. All intercompany accounts and transactions have been eliminated in consolidation. |
Reclassifications | Reclassifications Certain amounts in the 2015 consolidated financial statements have been reclassified to conform to the 2016 presentation. |
Use of Estimates | Use of Estimates To prepare our condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America, we are required to make significant estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. In addition, significant estimates were made in projecting future cash flows to quantify deferred tax assets, the costs associated with fulfilling our warranty obligations for the instruments that we sell, and the estimates employed in our calculation of fair value of stock options awarded and warrant derivative liability. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ from the estimates and assumptions used. |
Concentrations | Concentrations Credit Risk Our financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash, cash equivalents, and trade receivables. We have cash investment policies which, among other things, limit investments to investment-grade securities. We perform ongoing credit evaluations of our customers, and the risk with respect to trade receivables is further mitigated by the fact that many of our customers are government institutions, large pharmaceutical and biotechnology companies, and academic laboratories. The following table illustrates the level of concentration as a percentage of total revenues during the three months and nine months ended September 30, 2016 and 2015. For the Three Months Ended September 30, 2016 2015 Top Five Customers 60 % 43 % Federal Agencies 9 % 2 % For the Nine Months Ended September 30, 2016 2015 Top Five Customers 31 % 34 % Federal Agencies 3 % 14 % The following table illustrates the level of concentration as a percentage of net accounts receivable balance as of September 30, 2016 and December 31, 2015: September 30, 2016 December, 31, 2015 Top Five Customers 55 % 93 % Federal Agencies 9 % 1 % |
Product Supply | Product Supply A Massachusetts-based contract manufacturer started building the new NEP2320 Extreme Barocycler instrument in May 2016. We plan to have this manufacturer build all instruments in the future. |
Investment in Available-For-Sale Equity Securities | Investment in Available-For-Sale Equity Securities As of September 30, 2016, we held 601,500 shares of common stock of Everest Investments Holdings S.A. (Everest), a Polish publicly traded company listed on the Warsaw Stock Exchange. We account for this investment in accordance with ASC 320 Investments Debt and Equity Securities |
Inventories | Inventories Inventories are valued at the lower of cost (average cost) or market (sales price). The cost of Barocyclers consists of the cost charged by the contract manufacturer. The cost of manufactured goods includes material, freight-in, direct labor, and applicable overhead. The composition of inventory is as follows: September 30, 2016 December 31, 2015 Raw materials $ 491,254 $ 310,367 Finished goods 566,884 778,004 Inventory Reserve (50,000 ) (50,000 ) Total $ 1,008,138 $ 1,038,371 |
Debt Issuance Costs | Debt Issuance Costs In April 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2015-03, Simplifying the Presentation of Debt Issuance Costs (ASU 2015-03). ASU 2015-03 requires that debt issuance costs be presented as a direct deduction from the carrying amount of the related debt liability, consistent with the presentation of debt discounts. Prior to the issuance of ASU 2015-03, debt issuance costs were required to be presented as deferred charge assets, separate from the related debt liability. ASU 2015-03 does not change the recognition and measurement requirements for debt issuance costs. The Company early-adopted ASU 2015-03 as of the end of its Fiscal 2015, and applied its provisions retrospectively. |
Computation of Loss per Share | Computation of Loss per Share Basic loss per share is computed by dividing loss available to common shareholders by the weighted average number of common shares outstanding. Diluted loss per share is computed by dividing loss available to common shareholders by the weighted average number of common shares outstanding plus additional common shares that would have been outstanding if dilutive potential common shares had been issued. For purposes of this calculation, convertible preferred stock, common stock dividends, and warrants and options to acquire common stock, are all considered common stock equivalents in periods in which they have a dilutive effect and are excluded from this calculation in periods in which these are anti-dilutive to our net loss. The following table illustrates our computation of loss per share for the three months and nine months ended September 30, 2016 and 2015: For the Three Months Ended For the Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Numerator: Net loss $ (945,207 ) $ (657,928 ) $ (5,933,768 ) $ (3,430,160 ) Preferred dividends accrued 1,711 (21,768 ) Net loss applicable to common shareholders $ (945,207 ) $ (656,217 ) $ (5,933,768 ) $ (3,451,928 ) Denominator for basic and diluted loss per share: Weighted average common stock shares outstanding 29,425,362 20,737,827 26,139,740 19,771,323 Income (loss) per common share basic and diluted $ (0.03 ) $ (0.03 ) $ (0.23 ) $ (0.17 ) The following table presents securities that could potentially dilute basic loss per share in the future. For all periods presented, the potentially dilutive securities were not included in the computation of diluted loss per share because these securities would have been anti-dilutive to our net loss. The Series D Convertible Preferred Stock, Series G Convertible Preferred Stock, Series H Convertible Preferred Stock, Series J Convertible Preferred Stock and Series K Convertible Preferred Stock are presented below as if they were converted into common shares according to the conversion terms. As of September 30, 2016 2015 Stock options 5,269,250 3,201,250 Convertible debt 26,971,732 26,015,029 Common stock warrants 24,888,980 26,125,127 Convertible preferred stock: Series D Convertible Preferred Stock 750,000 750,000 Series G Convertible Preferred Stock 865,700 865,700 Series H Convertible Preferred Stock 1,000,000 1,000,000 Series H2 Convertible Preferred Stock 2,100,000 2,100,000 Series J Convertible Preferred Stock 3,521,000 3,546,000 Series K Convertible Preferred Stock 6,816,000 11,399,000 72,182,662 75,002,106 |
Accounting for Stock-Based Compensation Expense | Accounting for Stock-Based Compensation Expense We maintain equity compensation plans under which incentive stock options and non-qualified stock options are granted to employees, independent members of our Board of Directors and outside consultants. We recognize stock-based compensation expense over the requisite service period using the Black-Scholes formula to estimate the fair value of the stock options on the date of grant. |
Determining Fair Value of Stock Option Grants | Determining Fair Value of Stock Option Grants Valuation and Amortization Method - The fair value of each option award is estimated on the date of grant using the Black-Scholes pricing model based on certain assumptions. The estimated fair value of employee stock options is amortized to expense using the straight-line method over the vesting period. Expected Term - The Company uses the simplified calculation of expected life, as the Company does not currently have sufficient historical exercise data on which to base an estimate of expected term. Using this method, the expected term is determined using the average of the vesting period and the contractual life of the stock options granted. Expected Volatility - Expected volatility is based on the Companys historical stock volatility data over the expected term of the award. Risk-Free Interest Rate - The Company bases the risk-free interest rate used in the Black-Scholes valuation method on the implied yield currently available on U.S. Treasury zero-coupon issues with an equivalent remaining term. Forfeitures - The Company records stock-based compensation expense only for those awards that are expected to vest. The Company estimated a forfeiture rate of 5% for awards granted based on historical experience and future expectations of options vesting. The Company used this historical rate as our assumption in calculating future stock-based compensation expense. The Company recognized stock-based compensation expense of $90,500 and $74,864 for the three months ended September 30, 2016 and 2015, respectively. The following table summarizes the effect of this stock-based compensation expense within each of the line items of our costs and expenses within our Condensed Consolidated Statements of Operations: For the Three Months Ended September 30, 2016 2015 Research and development $ 14,735 $ 18,307 Selling and marketing 9,911 13,310 General and administrative 65,854 43,247 Total stock-based compensation expense $ 90,500 $ 74,864 The Company recognized stock-based compensation expense of $282,811 and $185,370 for the nine months ended September 30, 2016 and 2015, respectively. The following table summarizes the effect of this stock-based compensation expense within each of the line items of our costs and expenses within our Condensed Consolidated Statements of Operations: For the Nine Months Ended September 30 2016 2015 Research and development $ 50,766 $ 41,172 Selling and marketing 32,404 27,386 General and administrative 199,641 116,812 Total stock-based compensation expense $ 282,811 $ 185,370 |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Due to their short maturities, the carrying amounts for cash and cash equivalents, accounts receivable, accounts payable, and accrued expenses approximate their fair value. Long-term liabilities are primarily related to convertible debentures and deferred revenue with carrying values that approximate fair value. |
Fair Value Measurements | Fair Value Measurements The Company follows the guidance of FASB ASC Topic 820, Fair Value Measurements and Disclosures The Company generally defines fair value 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 (exit price). The Company uses a three-tier fair value hierarchy, which classifies the inputs used in measuring fair values. 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; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring the Company to develop its own assumptions. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company has determined that its financial assets are classified within Level 1 and its financial liabilities are currently classified within Level 3 in the fair value hierarchy. The development of the unobservable inputs for Level 3 fair value measurements and fair value calculations are the responsibility of the Companys management. The following tables set forth the Companys financial assets and liabilities that were accounted for at fair value on a recurring basis as of September 30, 2016: Fair value measurements at September 30, 2016 using: September 30, 2016 Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Available-For-Sale Equity Securities $ 59,550 $ 59,550 $ 0 $ - Total Financial Assets $ 59,550 $ 59,550 $ $ - September 30, 2016 Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Series D Preferred Stock Purchase Warrants $ 189,884 $ 189,884 Warrants Issued with Convertible Debt 4,135,980 4,135,980 Conversion Option Derivative Liabilities 4,627,452 4,627,452 Total Derivatives $ 8,953,316 $ $ $ 8,953,316 The following table provides a summary of the changes in fair value, including net transfers in and/or out, of the derivative financial instruments, measured at fair value on a recurring basis using significant unobservable inputs for the nine months ended September 30, 2016: December 31,2015 Issuance fair value Change in fair value Gain on extinguishment of derivative liabilities September 30, 2016 Available-For-Sale Equity Securities $ 294,522 - $ (234,972 ) $ $ 59,550 Total Financial Assets $ 294,522 $ $ (234,972 ) $ $ 59,550 December 31, 2015 Issuance fair value Change in fair value September 30, 2016 Series D Preferred Stock Purchase Warrants $ 173,526 $ $ 16,358 $ 189,884 Convertible Debt Warrants 3,122,450 1,094,432 (80,902 ) 4,135,980 Conversion Option Liabilities 3,940,791 1,547,127 (860,466 ) 4,627,452 Total Derivatives $ 7,236,767 $ 2,641,559 $ (925,010 ) $ 8,953,316 The amounts above valued at issuance includes $1,337,510 that was charged directly to change in fair value of derivative liabilities at issuance. The following tables set forth the Companys financial assets and liabilities that were accounted for at fair value on a recurring basis as of December 31, 2015: Fair value measurements at December 31, 2015 using: December 31, 2015 Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Available-For-Sale Equity Securities $ 294,522 $ 294,522 $ $ Total Financial Assets $ 294,522 $ 294,522 $ $ December 31, 2015 Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Series D Preferred Stock Purchase Warrants $ 173,526 $ 173,526 Warrants Issued with Convertible Debt 3,122,450 3,122,450 Conversion Option Derivative Liabilities 3,940,791 3,940,791 Total Derivatives $ 7,236,767 $ $ $ 7,236,767 The assumptions for the binomial pricing model are represented in the table below for the warrants issued in the Series D private placement reflected on a per share common stock equivalent basis. Assumptions November 10, 2011 Warrants revalued at December 31, 2015 Warrants revalued at September 30, 2016 Expected life (in months) 60.0 11.0 8.0 Expected volatility 104.5 % 104.9 % 92.4 % Risk-free interest rate 0.875 % 0.65 % 0.45 % Exercise price $ 0.81 $ 0.25 $ 0.25 Fair value per warrant $ 0.54 $ 0.16 $ 0.18 The assumptions for the binomial pricing model are represented in the table below for the warrants issued with the Convertible Debt throughout the period reflected on a per share common stock equivalent basis. Assumptions At Issuance Fair value Warrants revalued at December 31, 2015 Warrants revalued at September 30, 2016 Expected life (in months) 36.0-60.0 55.0-60.0 46.0-54.0 Expected volatility 114.3 - 138.3 % 136.3-141.6 % 116.2 -137.4 % Risk-free interest rate 0.86-1.69 % 1.29-1.76 % 1.01 % Exercise price $ 0.40-0.42 0.40 $ 0.40 Fair value per warrant $ 0.19-$.40 0.30 $ 0.30-$1.35 The assumptions for the binomial pricing model are represented in the table below for the conversion options reflected on a per share common stock equivalent basis. Assumptions At Issuance fair value Conversion options revalued at December 31, 2015 Conversion options revalued at September 30, 2016 Expected life (in months) 3-24 18-24 10-18 Expected volatility 97.6-153.8 % 112.2-114.7 % 94.3%-96.6 % Risk-free interest rate 0.37-0.99 % 1.06 % 0.59-0.77 % Exercise price $ 0.24-$0.45 $ 0.28 $ 0.28 Fair value per conversion option $ 0.07-$0.30 $ 0.14-$0.33 $ 0.17-$0.21 |
Summary of Significant Accoun16
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
Summary of Customer Concentration Risk Percentage | The following table illustrates the level of concentration as a percentage of total revenues during the three months and nine months ended September 30, 2016 and 2015. For the Three Months Ended September 30, 2016 2015 Top Five Customers 60 % 43 % Federal Agencies 9 % 2 % For the Nine Months Ended September 30, 2016 2015 Top Five Customers 31 % 34 % Federal Agencies 3 % 14 % The following table illustrates the level of concentration as a percentage of net accounts receivable balance as of September 30, 2016 and December 31, 2015: September 30, 2016 December, 31, 2015 Top Five Customers 55 % 93 % Federal Agencies 9 % 1 % |
Schedule of Inventories | The composition of inventory is as follows: September 30, 2016 December 31, 2015 Raw materials $ 491,254 $ 310,367 Finished goods 566,884 778,004 Inventory Reserve (50,000 ) (50,000 ) Total $ 1,008,138 $ 1,038,371 |
Summary of Computation of Loss per Share | The following table illustrates our computation of loss per share for the three months and nine months ended September 30, 2016 and 2015: For the Three Months Ended For the Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Numerator: Net loss $ (945,207 ) $ (657,928 ) $ (5,933,768 ) $ (3,430,160 ) Preferred dividends accrued 1,711 (21,768 ) Net loss applicable to common shareholders $ (945,207 ) $ (656,217 ) $ (5,933,768 ) $ (3,451,928 ) Denominator for basic and diluted loss per share: Weighted average common stock shares outstanding 29,425,362 20,737,827 26,139,740 19,771,323 Income (loss) per common share basic and diluted $ (0.03 ) $ (0.03 ) $ (0.23 ) $ (0.17 ) |
Summary of Anti-dilutive Securities Excluded from Computation of Earnings per Share | The following table presents securities that could potentially dilute basic loss per share in the future. For all periods presented, the potentially dilutive securities were not included in the computation of diluted loss per share because these securities would have been anti-dilutive to our net loss. The Series D Convertible Preferred Stock, Series G Convertible Preferred Stock, Series H Convertible Preferred Stock, Series J Convertible Preferred Stock and Series K Convertible Preferred Stock are presented below as if they were converted into common shares according to the conversion terms. As of September 30, 2016 2015 Stock options 5,269,250 3,201,250 Convertible debt 26,971,732 26,015,029 Common stock warrants 24,824,695 26,125,127 Convertible preferred stock: Series D Convertible Preferred Stock 750,000 750,000 Series G Convertible Preferred Stock 865,700 865,700 Series H Convertible Preferred Stock 1,000,000 1,000,000 Series H2 Convertible Preferred Stock 2,100,000 2,100,000 Series J Convertible Preferred Stock 3,521,000 3,546,000 Series K Convertible Preferred Stock 6,816,000 11,399,000 72,118,377 75,002,106 |
Summary of Stock Based Compensation Expense | The following table summarizes the effect of this stock-based compensation expense within each of the line items of our costs and expenses within our Condensed Consolidated Statements of Operations: For the Three Months Ended September 30, 2016 2015 Research and development $ 14,735 $ 18,307 Selling and marketing 9,911 13,310 General and administrative 65,854 43,247 Total stock-based compensation expense $ 90,500 $ 74,864 The following table summarizes the effect of this stock-based compensation expense within each of the line items of our costs and expenses within our Condensed Consolidated Statements of Operations: For the Nine Months Ended September 30 2016 2015 Research and development $ 50,766 $ 41,172 Selling and marketing 32,404 27,386 General and administrative 199,641 116,812 Total stock-based compensation expense $ 282,811 $ 185,370 |
Schedule of Liabilities Measured at Fair Value on Recurring Basis | The following tables set forth the Companys financial assets and liabilities that were accounted for at fair value on a recurring basis as of September 30, 2016: Fair value measurements at September 30, 2016 using: September 30, 2016 Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Available-For-Sale Equity Securities $ 59,550 $ 59,550 $ - $ - Total Financial Assets $ 59,550 $ 59,550 $ - $ - September 30, 2016 Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Series D Preferred Stock Purchase Warrants $ 189,884 $ $ $ 189,884 Warrants Issued with Convertible Debt 4,135,980 4,135,980 Conversion Option Derivative Liabilities 4,627,452 4,627,452 Total Derivatives $ 8,953,316 $ $ $ 8,953,316 The following table provides a summary of the changes in fair value, including net transfers in and/or out, of the derivative financial instruments, measured at fair value on a recurring basis using significant unobservable inputs for the nine months ended September 30, 2016: December 31,2015 Issuance fair value Change in fair value Gain on extinguishment of derivative liabilities September 30, 2016 Available-For-Sale Equity Securities $ 294,522 $ - $ (234,972 ) $ $ 59,550 Total Financial Assets $ 294,522 $ $ (234,972 ) $ $ 59,550 December 31, 2015 Issuance fair value Change in fair value September 30, 2016 Series D Preferred Stock Purchase Warrants $ 173,526 $ $ 16,358 $ 189,884 Convertible Debt Warrants 3,122,450 1,094,432 (80,902 ) 4,135,980 Conversion Option Liabilities 3,940,791 1,547,127 (860,466 ) 4,627,452 Total Derivatives $ 7,236,767 $ 2,641,559 $ (925,010 ) $ 8,953,316 The amounts above valued at issuance includes $1,337,510 that was charged directly to change in fair value of derivative liabilities at issuance. The following tables set forth the Companys financial assets and liabilities that were accounted for at fair value on a recurring basis as of December 31, 2015: Fair value measurements at December 31, 2015 using: December 31, 2015 Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Available-For-Sale Equity Securities $ 294,522 $ 294,522 $ $ Total Financial Assets $ 294,522 $ 294,522 $ $ December 31, 2015 Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Series D Preferred Stock Purchase Warrants $ 173,526 $ $ $ 173,526 Warrants Issued with Convertible Debt 3,122,450 3,122,450 Conversion Option Derivative Liabilities 3,940,791 3,940,791 Total Derivatives $ 7,236,767 $ $ $ 7,236,767 |
Schedule of Fair Value Assumptions | The assumptions for the binomial pricing model are represented in the table below for the warrants issued in the Series D private placement reflected on a per share common stock equivalent basis. Assumptions November 10, 2011 Warrants revalued at December 31, 2015 Warrants revalued at September 30, 2016 Expected life (in months) 60.0 11.0 8.0 Expected volatility 104.5 % 104.9 % 92.4 % Risk-free interest rate 0.875 % 0.65 % 0.45 % Exercise price $ 0.81 $ 0.25 $ 0.25 Fair value per warrant $ 0.54 $ 0.16 $ 0.18 The assumptions for the binomial pricing model are represented in the table below for the warrants issued with the Convertible Debt throughout the period reflected on a per share common stock equivalent basis. Assumptions At Issuance Fair value Warrants revalued at December 31, 2015 Warrants revalued at September 30, 2016 Expected life (in months) 36.0-60.0 55.0-60.0 46.0-54.0 Expected volatility 114.3 - 138.3 % 136.3-141.6 % 116.2 -137.4 % Risk-free interest rate 0.86-1.69 % 1.29-1.76 % 1.01 % Exercise price $ 0.40-0.42 0.40 $ 0.40 Fair value per warrant $ 0.19-$.40 0.30 $ 0.30-$1.35 The assumptions for the binomial pricing model are represented in the table below for the conversion options reflected on a per share common stock equivalent basis. Assumptions At Issuance fair value Conversion options revalued at December 31, 2015 Conversion options revalued at September 30, 2016 Expected life (in months) 3-24 18-24 10-18 Expected volatility 97.6-153.8 % 112.2-114.7 % 94.3%-96.6 % Risk-free interest rate 0.37-0.99 % 1.06 % 0.59-0.77 % Exercise price $ 0.24-$0.45 $ 0.28 $ 0.28 Fair value per conversion option $ 0.07-$0.30 $ 0.14-$0.33 $ 0.17-$0.21 |
Convertible Debt and Other De17
Convertible Debt and Other Debt (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Debt Disclosure [Abstract] | |
Schedule of Convertible Debts and Outstanding Balances | The specific terms of the convertible debts and outstanding balances as of September 30, 2016 are listed in the table below. Fixed Rate Convertible Notes Inception Date Term Loan Amount Outstanding Balance Original Issue Discount Interest Rate Deferred Finance Fees Discount related to fair value of conversion feature and warrants/shares July 22, 2015 24 months $ 2,180,000 $ 2,180,000 $ 218,000 1 10 % 2 $ 388,532 $ 2,163,074 September 25, 2015 24 months 1,100,000 1,100,000 110,000 1 10 % 2 185,956 1,022,052 October 2, 2015 24 months 150,000 150,000 15,000 1 10 % 2 26,345 140,832 October 6, 2015 24 months 30,000 30,000 3,000 1 10 % 2 5,168 26,721 October 14, 2015 24 months 50,000 50,000 5,000 1 10 % 2 8,954 49,377 November 2, 2015 24 months 250,000 250,000 25,000 1 10 % 2 43,079 222,723 November 10, 2015 24 months 50,000 50,000 5,000 1 10 % 2 8,790 46,984 November 12, 2015 24 months 215,000 215,000 21,500 1 10 % 2 38,518 212,399 November 20, 2015 24 months 200,000 200,000 20,000 1 10 % 2 37,185 200,000 December 4, 2015 24 months 170,000 170,000 17,000 1 10 % 2 37,352 170,000 December 11, 2015 24 months 360,000 360,000 36,000 1 10 % 2 75,449 360,000 December 18, 2015 24 months 55,000 55,000 5,500 1 10 % 2 11,714 55,000 December 31, 2015 24 months 100,000 100,000 10,000 1 10 % 2 20,634 100,000 January 11, 2016 24 months 100,000 100,000 10,000 1 10 % 2 24,966 80,034 January 20, 2016 24 months 50,000 50,000 5,000 1 10 % 2 9,812 40,188 January 29, 2016 24 months 300,000 300,000 30,000 1 10 % 2 60,887 239,113 February 26, 2016 24 months 200,000 200,000 20,000 1 10 % 2 43,952 156,048 March 10, 2016 24 months 125,000 125,000 12,500 1 10 % 2 18,260 106,740 March 18, 2016 24 months 360,000 360,000 36,000 1 10 % 2 94,992 265,008 March 24, 2016 24 months 106,667 106,667 10,667 1 10 % 2 15,427 91,240 March 31, 2016 24 months 167,882 167,882 16,788 1 10 % 2 2,436 165,446 April 5, 2016 24 months 10,000 10,000 1,000 1 10 % 2 - 10,000 May 24, 2016 7 months 100,000 100,000 7,000 0 % - 20,368 June 15, 2016 6 months 40,000 40,000 - 12 % - 3,680 June 17, 2016 6 months 40,000 40,000 - 12 % - 3,899 June 22, 2016 6 months 35,000 35,000 - 12 % - 3,373 July 6, 2016 6 months 85,000 85,000 - 12 % - 15,048 July 29, 2016 6 months 100,000 100,000 - 12 % - 25,518 September 15, 2016 8 months 500,000 500,000 40,541 9 % - 65,972 $ 7,229,549 $ 7,229,549 $ 680,496 $ 1,158,408 $ 6,060,837 |
Summary of Changes in Convertible Debt, Net of Unamortized Discount | The following table provides a summary of the changes in convertible debt, net of unamortized discount, during 2016: 2016 Balance at January 1, $ 277,342 Issuance of convertible debt, face value 2,509,045 Original issue discount (189,496 ) Debt discount from derivative liabilities (embedded conversion option and warrants) (1,153,817 ) Debt discount from shares and warrants issued with the notes (117,137 ) Debt discount from beneficial conversion feature (20,721 ) Deferred financing fees (270,732 ) Conversion of debentures to common shares (100,000) Accretion of interest and amortization of debt discount to interest expense through September 30, 2,808,261 Balance at September 30, 3,742,745 Less: current portion 2,664,334 Convertible debt, long-term portion $ 1,078,411 |
Stockholders' Deficit (Tables)
Stockholders' Deficit (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Equity [Abstract] | |
Schedule of Concerning Options and Warrants Outstanding and Exercisable | The following tables summarize information concerning options and warrants outstanding and exercisable: Stock Options Warrants Weighted Weighted Average Average Total Shares Price per share Shares Price per share Shares Exercisable Balance outstanding, 01/01/15 3,406,250 $ 0.51 19,182,201 $ 0.49 22,588,451 16,611,528 Granted 2,500,000 0.40 10,837,141 0.40 13,337,141 Exercised Expired (205,000 ) 1.00 (791,678 ) 0.31 (996,678 ) Forfeited (130,000 ) 0.70 (130,000 ) Balance outstanding, 12/31/15 5,571,250 $ 0.44 29,227,664 $ 0.44 34,798,914 31,664,469 Granted 4,294,552 0.43 4,294,552 Exercised (70,000 ) 0.31 (70,000 ) Expired (186,000 ) 1.00 (8,627,521 ) 0.61 (8,813,521 ) Forfeited (116,000 ) 0.51 (116,000 ) Balance outstanding, 9/30/2016 5,269,250 $ 0.42 24,824,695 $ 0.39 30,093,945 28,095,959 |
Schedule of Share-based Compensation Stock Option Plans by Exercise Price Range | Options Outstanding Options Exercisable Weighted Average Weighted Average Range of Exercise Prices Number of Options Remaining Contractual Life (Years) Exercise Price Number of Options Remaining Contractual Life (Years) Exercise Price $0.30 - $0.39 1,625,500 8.0 $ 0.30 1,248,514 8.0 $ 0.30 0.40 - 0.49 2,786,000 9.0 0.40 1,165,000 8.6 0.40 0.50 - 0.59 226,250 5.9 0.50 226,250 5.9 0.50 0.60 - 0.69 385,500 3.4 0.60 385,500 3.4 0.60 0.70 - 1.25 246,000 2.6 1.00 246,000 2.6 1.00 $0.30 - $1.25 5,269,250 7.8 $ 0.42 3,271,264 7.1 $ 0.44 |
Business Overview, Liquidity 19
Business Overview, Liquidity and Management Plans (Details Narrative) | 9 Months Ended |
Sep. 30, 2016lb | |
Pounds per square inch | 35,000 |
PBI Europe [Member] | |
Percentage of ownership interest | 49.00% |
Investment Bank [Member] | |
Percentage of ownership interest | 51.00% |
Going Concern (Details Narrativ
Going Concern (Details Narrative) - USD ($) | Mar. 31, 2016 | Sep. 30, 2016 |
Going Concern | ||
Over subscribed on debt financing | $ 5,000,000 | |
Debt financing | $ 6,300,000 | |
Net proceeds from additional convertible and non-convertible debt | $ 3,447,166 |
Summary of Significant Accoun21
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Forfeiture rate percentage | 5.00% | |||
Stock-based compensation expense | $ 90,500 | $ 74,864 | $ 282,811 | $ 185,370 |
Change in fair value of derivative liabilities | $ 1,337,510 | |||
Everest Investments Holding [Member] | ||||
Sale of stock number of shares recevied | 601,500 | |||
Fair value of investment | $ 59,550 | $ 59,550 | ||
Shares closing price per share | $ 0.10 | $ 0.10 |
Summary of Significant Accoun22
Summary of Significant Accounting Policies - Summary of Customer Concentration Risk Percentage (Details) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | |
Top Five Customers [Member] | Revenue [Member] | |||||
Concentration as a percentage | 60.00% | 43.00% | 31.00% | 34.00% | |
Top Five Customers [Member] | Accounts Receivable [Member] | |||||
Concentration as a percentage | 55.00% | 93.00% | |||
Federal Agencies [Member] | Revenue [Member] | |||||
Concentration as a percentage | 9.00% | 2.00% | 3.00% | 14.00% | |
Federal Agencies [Member] | Accounts Receivable [Member] | |||||
Concentration as a percentage | 9.00% | 1.00% |
Summary of Significant Accoun23
Summary of Significant Accounting Policies - Schedule of Inventories (Details) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Summary Of Significant Accounting Policies - Schedule Of Inventories Details | ||
Raw materials | $ 491,254 | $ 310,367 |
Finished goods | 566,884 | 778,004 |
Inventory Reserve | (50,000) | (50,000) |
Total | $ 1,008,138 | $ 1,038,371 |
Summary of Significant Accoun24
Summary of Significant Accounting Policies - Summary of Computation of Loss per Share (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Accounting Policies [Abstract] | ||||
Net loss | $ (945,207) | $ (657,928) | $ (5,933,768) | $ (3,430,160) |
Preferred dividends accrued | 1,711 | (21,768) | ||
Net loss applicable to common shareholders | $ (945,207) | $ (656,217) | $ (5,933,768) | $ (3,451,928) |
Weighted average common stock shares outstanding | 29,425,362 | 20,737,827 | 26,139,740 | 19,771,323 |
Income (loss) per common share - basic and diluted | $ (0.03) | $ (0.03) | $ (0.23) | $ (0.17) |
Summary of Significant Accoun25
Summary of Significant Accounting Policies - Summary of Anti-dilutive Securities Excluded from Computation of Earnings per Share (Details) - shares | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Stock Options [Member] | ||
Total potentially dilutive shares | 5,269,250 | 3,201,250 |
Convertible Debt [Member] | ||
Total potentially dilutive shares | 26,971,732 | 26,015,029 |
Common Stock Warrants [Member] | ||
Total potentially dilutive shares | 24,824,695 | 26,125,127 |
Series D Convertible Preferred Stock [Member] | ||
Total potentially dilutive shares | 750,000 | 750,000 |
Series G Convertible Preferred Stock [Member] | ||
Total potentially dilutive shares | 865,700 | 865,700 |
Series H Convertible Preferred Stock [Member] | ||
Total potentially dilutive shares | 1,000,000 | 1,000,000 |
Series H2 Convertible Preferred Stock [Member] | ||
Total potentially dilutive shares | 2,100,000 | 2,100,000 |
Series J Convertible Preferred Stock [Member] | ||
Total potentially dilutive shares | 3,521,000 | 3,546,000 |
Series K Convertible Preferred Stock [Member] | ||
Total potentially dilutive shares | 6,816,000 | 11,399,000 |
Potentially Dilutive Shares [Member] | ||
Total potentially dilutive shares | 72,118,377 | 75,002,106 |
Summary of Significant Accoun26
Summary of Significant Accounting Policies - Summary of Stock Based Compensation Expense (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Total stock-based compensation expense | $ 90,500 | $ 74,864 | $ 282,811 | $ 185,370 |
Research and Development [Member] | ||||
Total stock-based compensation expense | 14,735 | 18,307 | 50,766 | 41,172 |
Selling and Marketing [Member] | ||||
Total stock-based compensation expense | 9,911 | 13,310 | 32,404 | 27,386 |
General and Administrative [Member] | ||||
Total stock-based compensation expense | $ 65,854 | $ 43,247 | $ 199,641 | $ 116,812 |
Summary of Significant Accoun27
Summary of Significant Accounting Policies - Schedule of Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | |
Total Financial Assets | $ 59,550 | $ 59,550 | $ 294,522 | ||
Fair value of derivative liability | 8,953,316 | 8,953,316 | 7,236,767 | ||
Balance | 7,236,767 | ||||
Issuance fair value | 2,641,559 | ||||
Change in Fair Value | (925,010) | ||||
Gain on extinguishment of derivative liabilities | 623,128 | $ 437,379 | (412,500) | $ 38,968 | |
Balance | 8,953,316 | 8,953,316 | |||
Financial Assets [Member] | |||||
Balance | 294,522 | ||||
Issuance fair value | |||||
Change in Fair Value | (234,972) | ||||
Gain on extinguishment of derivative liabilities | |||||
Balance | 59,550 | 59,550 | |||
Quoted Prices in Active Markets (Level 1) [Member] | |||||
Total Financial Assets | 59,550 | 59,550 | 294,522 | ||
Fair value of derivative liability | |||||
Significant Other Observable Inputs (Level 2) [Member] | |||||
Total Financial Assets | 0 | 0 | |||
Fair value of derivative liability | |||||
Significant Unobservable Inputs (Level 3) [Member] | |||||
Total Financial Assets | 0 | 0 | |||
Fair value of derivative liability | 8,953,316 | 8,953,316 | 7,236,767 | ||
Available-For-Sale Equity Securities [Member] | |||||
Total Financial Assets | 59,550 | 59,550 | 294,522 | ||
Balance | 294,522 | ||||
Balance | 59,550 | 59,550 | |||
Available-For-Sale Equity Securities [Member] | Financial Assets [Member] | |||||
Balance | 294,522 | ||||
Issuance fair value | |||||
Change in Fair Value | (234,972) | ||||
Gain on extinguishment of derivative liabilities | |||||
Balance | 59,550 | 59,550 | |||
Available-For-Sale Equity Securities [Member] | Quoted Prices in Active Markets (Level 1) [Member] | |||||
Total Financial Assets | 59,550 | 59,550 | 294,522 | ||
Available-For-Sale Equity Securities [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||||
Total Financial Assets | |||||
Available-For-Sale Equity Securities [Member] | Significant Unobservable Inputs (Level 3) [Member] | |||||
Total Financial Assets | |||||
Series D Preferred Stock Purchase Warrants [Member] | |||||
Fair value of derivative liability | 189,884 | 189,884 | 173,526 | ||
Balance | 173,526 | ||||
Issuance fair value | |||||
Change in Fair Value | 16,358 | ||||
Balance | 189,884 | 189,884 | |||
Series D Preferred Stock Purchase Warrants [Member] | Quoted Prices in Active Markets (Level 1) [Member] | |||||
Fair value of derivative liability | |||||
Series D Preferred Stock Purchase Warrants [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||||
Fair value of derivative liability | |||||
Series D Preferred Stock Purchase Warrants [Member] | Significant Unobservable Inputs (Level 3) [Member] | |||||
Fair value of derivative liability | 189,884 | 189,884 | 173,526 | ||
Warrants Issued with Convertible Debt [Member] | |||||
Fair value of derivative liability | 4,135,980 | 4,135,980 | 3,122,450 | ||
Balance | 3,122,450 | ||||
Balance | 4,135,980 | 4,135,980 | |||
Warrants Issued with Convertible Debt [Member] | Quoted Prices in Active Markets (Level 1) [Member] | |||||
Fair value of derivative liability | |||||
Warrants Issued with Convertible Debt [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||||
Fair value of derivative liability | |||||
Warrants Issued with Convertible Debt [Member] | Significant Unobservable Inputs (Level 3) [Member] | |||||
Fair value of derivative liability | 4,135,980 | 4,135,980 | 3,122,450 | ||
Conversion Option Derivative Liabilities [Member] | |||||
Fair value of derivative liability | 4,627,452 | 4,627,452 | 3,940,791 | ||
Balance | 3,940,791 | ||||
Balance | 4,627,452 | 4,627,452 | |||
Conversion Option Derivative Liabilities [Member] | Quoted Prices in Active Markets (Level 1) [Member] | |||||
Fair value of derivative liability | |||||
Conversion Option Derivative Liabilities [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||||
Fair value of derivative liability | |||||
Conversion Option Derivative Liabilities [Member] | Significant Unobservable Inputs (Level 3) [Member] | |||||
Fair value of derivative liability | 4,627,452 | 4,627,452 | $ 3,940,791 | ||
Convertible Debt Warrants [Member] | |||||
Balance | 3,122,450 | ||||
Issuance fair value | 1,094,432 | ||||
Change in Fair Value | (80,902) | ||||
Balance | 4,135,980 | 4,135,980 | |||
Conversion Option Liabilities [Member] | |||||
Balance | 3,940,791 | ||||
Issuance fair value | 1,547,127 | ||||
Change in Fair Value | (860,466) | ||||
Balance | $ 4,627,452 | $ 4,627,452 |
Summary of Significant Accoun28
Summary of Significant Accounting Policies - Schedule of Fair Value Assumptions (Details) - $ / shares | Nov. 10, 2011 | Sep. 30, 2016 | Dec. 31, 2015 |
Expected life (in months) | 60 months | ||
Expected volatility | 104.50% | ||
Risk-free interest rate | 0.875% | ||
Exercise price | $ 0.81 | ||
Fair value per share | $ 0.54 | ||
Warrants Issued with Convertible Debt [Member] | Warrants Revalued at December 31, 2015 [Member] | |||
Exercise price | $ 0.40 | ||
Fair value per share | $ 0.30 | ||
Warrants Revalued at December 31, 2015 [Member] | |||
Expected life (in months) | 11 months | ||
Expected volatility | 104.90% | ||
Risk-free interest rate | 0.65% | ||
Exercise price | $ .25 | ||
Fair value per share | $ 0.16 | ||
Warrants Revalued at December 31, 2015 [Member] | Warrants Issued with Convertible Debt [Member] | Minimum [Member] | |||
Expected life (in months) | 55 months | ||
Expected volatility | 136.30% | ||
Risk-free interest rate | 1.29% | ||
Warrants Revalued at December 31, 2015 [Member] | Warrants Issued with Convertible Debt [Member] | Maximum [Member] | |||
Expected life (in months) | 60 months | ||
Expected volatility | 141.60% | ||
Risk-free interest rate | 1.76% | ||
Warrants Revalued at September 30, 2016 [Member] | |||
Expected life (in months) | 8 months | ||
Expected volatility | 92.40% | ||
Risk-free interest rate | 0.45% | ||
Exercise price | $ 0.25 | ||
Fair value per share | $ 0.18 | ||
Warrants Revalued at September 30, 2016 [Member] | Warrants Issued with Convertible Debt [Member] | |||
Risk-free interest rate | 1.01% | ||
Exercise price | $ 0.40 | ||
Warrants Revalued at September 30, 2016 [Member] | Warrants Issued with Convertible Debt [Member] | Minimum [Member] | |||
Expected life (in months) | 46 months | ||
Expected volatility | 116.20% | ||
Fair value per share | $ 0.30 | ||
Warrants Revalued at September 30, 2016 [Member] | Warrants Issued with Convertible Debt [Member] | Maximum [Member] | |||
Expected life (in months) | 54 months | ||
Expected volatility | 137.40% | ||
Fair value per share | $ 1.35 | ||
Issuance Fair Value [Member] | Minimum [Member] | |||
Expected life (in months) | 3 months | ||
Expected volatility | 97.60% | ||
Risk-free interest rate | 0.37% | ||
Exercise price | $ 0.24 | ||
Fair value per share | $ 0.07 | ||
Issuance Fair Value [Member] | Maximum [Member] | |||
Expected life (in months) | 24 months | ||
Expected volatility | 153.80% | ||
Risk-free interest rate | 0.99% | ||
Exercise price | $ 0.45 | ||
Fair value per share | $ 0.30 | ||
Issuance Fair Value [Member] | Warrants Issued with Convertible Debt [Member] | Minimum [Member] | |||
Expected life (in months) | 36 months | ||
Expected volatility | 114.30% | ||
Risk-free interest rate | 0.86% | ||
Exercise price | $ 0.40 | ||
Fair value per share | $ 0.19 | ||
Issuance Fair Value [Member] | Warrants Issued with Convertible Debt [Member] | Maximum [Member] | |||
Expected life (in months) | 60 months | ||
Expected volatility | 138.30% | ||
Risk-free interest rate | 1.69% | ||
Exercise price | $ 0.42 | ||
Fair value per share | 0.40 | ||
Conversion Options Revalued at December 31, 2015 [Member] | |||
Risk-free interest rate | 1.06% | ||
Exercise price | $ 0.28 | ||
Conversion Options Revalued at December 31, 2015 [Member] | Minimum [Member] | |||
Expected life (in months) | 18 months | ||
Expected volatility | 112.20% | ||
Fair value per share | $ 0.14 | ||
Conversion Options Revalued at December 31, 2015 [Member] | Maximum [Member] | |||
Expected life (in months) | 24 months | ||
Expected volatility | 114.70% | ||
Fair value per share | $ 0.33 | ||
Conversion Options Revalued at September 30, 2016 [Member] | |||
Exercise price | $ 0.28 | ||
Conversion Options Revalued at September 30, 2016 [Member] | Minimum [Member] | |||
Expected life (in months) | 10 months | ||
Expected volatility | 94.30% | ||
Risk-free interest rate | 0.59% | ||
Fair value per share | $ 0.17 | ||
Conversion Options Revalued at September 30, 2016 [Member] | Maximum [Member] | |||
Expected life (in months) | 18 months | ||
Expected volatility | 96.60% | ||
Risk-free interest rate | 0.77% | ||
Fair value per share | $ 0.21 |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) - USD ($) | Dec. 29, 2015 | Nov. 01, 2014 | Sep. 30, 2016 | Sep. 30, 2015 |
Rental expenses | $ 5,385 | $ 108,038 | $ 73,775 | |
Extended lease term | Dec. 30, 2017 | |||
Grand received | $ 1,050,000 | |||
Corporate Office [Member] | ||||
Rental expenses | $ 4,800 | |||
Extended lease term | Dec. 31, 2016 |
Convertible Debt and Other De30
Convertible Debt and Other Debt (Details Narrative) - USD ($) | Sep. 15, 2016 | Aug. 26, 2016 | Aug. 25, 2016 | Jul. 29, 2016 | Jul. 02, 2016 | Jun. 14, 2016 | May 24, 2016 | May 13, 2016 | Feb. 08, 2016 | Jan. 20, 2016 | Jun. 06, 2014 | Sep. 30, 2016 | Sep. 30, 2015 | Aug. 16, 2016 | Jun. 30, 2016 | May 09, 2016 | Dec. 31, 2015 | Jan. 06, 2014 |
Warrants purchase price | $ 5,683,897 | $ 5,416,681 | ||||||||||||||||
Debt principal amount | $ 2,509,045 | |||||||||||||||||
Percentage of outstanding principal amount of debenture | 120.00% | |||||||||||||||||
Warrants rights description | Subject to the terms and conditions of the Warrants, at any time commencing six months from the Final Closing, the Company has the right to call the Warrants for cancellation if the volume weighted average price of its Common Stock on the OTC QB Market (or other primary trading market or exchange on which the Common Stock is then traded) equals or exceeds three times the per share exercise price of the Warrants for 15 out of 20 consecutive trading days. | |||||||||||||||||
Amortized of debt discount | $ 2,768,527 | |||||||||||||||||
Fair value of warrant | 2,847,624 | |||||||||||||||||
Gross proceeds from warrants | 6,329,549 | |||||||||||||||||
Debt conversion amount | $ 117,837 | (100,000) | ||||||||||||||||
Debt conversion into common stock shares | 420,849 | |||||||||||||||||
Beneficial conversion feature | (20,721) | |||||||||||||||||
Proceeds from pay off outstanding balance of previous loan | 264,667 | |||||||||||||||||
Proceeds from common stock | 382,965 | |||||||||||||||||
Convertible debentures issued to related parties | 291,000 | |||||||||||||||||
Borrowed from related parties | 96,667 | 6,300 | ||||||||||||||||
Repayment of debt | $ 2,107,065 | |||||||||||||||||
Gain on settlement of previous loan | 5,044 | |||||||||||||||||
Other Convertible Notes [Member] | ||||||||||||||||||
Debt principal amount | $ 200,000 | |||||||||||||||||
Percentage of annual interest rates | 9.00% | |||||||||||||||||
Debt conversion price per share | $ 0.45 | $ 0.45 | $ 0.45 | $ 0.45 | ||||||||||||||
Issuance of warrants to purchase of common stock shares | 50,000 | |||||||||||||||||
Warrant exercise price per share | $ .55 | |||||||||||||||||
Amortized of debt discount | $ 40,541 | $ 25,518 | $ 26,000 | |||||||||||||||
Fair value of warrant | $ 12,406 | |||||||||||||||||
Debt conversion into common stock shares | 200,000 | 32,500 | 65,000 | 30,667 | ||||||||||||||
Additional convertible debentures | $ 500,000 | $ 100,000 | $ 115,000 | 107,000 | ||||||||||||||
Beneficial conversion feature | 12,759 | $ 7,962 | ||||||||||||||||
Proceeds from pay off outstanding balance of previous loan | $ 85,000 | |||||||||||||||||
Fair value of convertible note | 434,028 | 87,241 | ||||||||||||||||
Fair value of common shares | $ 12,759 | |||||||||||||||||
Proceeds from common stock | $ 65,972 | |||||||||||||||||
Individuals [Member] | ||||||||||||||||||
Borrowed from related parties | $ 50,000 | |||||||||||||||||
Lender [Member] | ||||||||||||||||||
Debt conversion amount | $ 41,200 | |||||||||||||||||
Debt conversion into common stock shares | 100,049 | |||||||||||||||||
Lender [Member] | Merchant Agreement [Member] | ||||||||||||||||||
Debt principal amount | $ 100,000 | $ 70,000 | $ 125,000 | |||||||||||||||
Other note outstanding balance | $ 4,620 | |||||||||||||||||
Other note outstanding balance after payment | 56,841 | |||||||||||||||||
Proceeds from pay off outstanding balance of previous loan | $ 122,645 | |||||||||||||||||
Fair value of convertible note | 49,200 | |||||||||||||||||
Payment of other notes | 129,900 | |||||||||||||||||
Collected rate business day | $ 1,386 | 927 | ||||||||||||||||
Debenture fee | $ 2,000 | |||||||||||||||||
Pay off prior loan amount | $ 48,420 | |||||||||||||||||
Repayment of debt | 70,000 | |||||||||||||||||
Lender [Member] | Other Convertible Notes [Member] | ||||||||||||||||||
Debt conversion amount | $ 117,837 | |||||||||||||||||
Debt conversion into common stock shares | 420,849 | |||||||||||||||||
Other note outstanding balance | 0 | |||||||||||||||||
Lender [Member] | Other Notes [Member] | Merchant Agreement [Member] | ||||||||||||||||||
Debt principal amount | 93,161 | $ 250,000 | ||||||||||||||||
Other note outstanding balance | 105,125 | |||||||||||||||||
Proceeds from pay off outstanding balance of previous loan | $ 138,840 | |||||||||||||||||
Payment of other notes | 322,500 | |||||||||||||||||
Collected rate business day | $ 1,280 | |||||||||||||||||
Debenture fee | $ 2,500 | |||||||||||||||||
Lender [Member] | Promissory Note [Member] | Merchant Agreement [Member] | ||||||||||||||||||
Debt principal amount | $ 200,000 | |||||||||||||||||
Issuance of warrants to purchase of common stock shares | 100,000 | |||||||||||||||||
Warrant exercise price per share | $ 0.55 | |||||||||||||||||
Amortized of debt discount | $ 6,000 | |||||||||||||||||
Fair value of warrant | 27,349 | |||||||||||||||||
Debt conversion amount | $ 41,200 | |||||||||||||||||
Debt conversion into common stock shares | 100,049 | |||||||||||||||||
Other note outstanding balance | 0 | |||||||||||||||||
Repayment of debt | $ 206,000 | |||||||||||||||||
Loan paid back date | Aug. 25, 2016 | |||||||||||||||||
Debt maturity date start | Aug. 11, 2016 | |||||||||||||||||
Debt maturity date ending | Aug. 25, 2016 | |||||||||||||||||
Lender [Member] | Merchant Agreement [Member] | ||||||||||||||||||
Other note outstanding balance | $ 91,736 | |||||||||||||||||
Subscription Agreement [Member] | Individuals [Member] | July 23, 2015 and March 31, 2016 [Member] | ||||||||||||||||||
Percentage of warrants to purchase shares of common stock | 50.00% | |||||||||||||||||
Warrants purchase price | $ 6,329,549 | |||||||||||||||||
Debt principal amount | $ 6,962,504 | |||||||||||||||||
Percentage of debt original issue discount on purchase price | 10.00% | |||||||||||||||||
Percentage of annual interest rates | 10.00% | |||||||||||||||||
Convertible debentures term | 2 years | |||||||||||||||||
Debt conversion price per share | $ 0.28 | |||||||||||||||||
Percentage of outstanding principal amount of debenture | 120.00% | |||||||||||||||||
Issuance of warrants to purchase of common stock shares | 11,302,766 | |||||||||||||||||
Warrant exercise price per share | $ 0.40 | |||||||||||||||||
Warrants expiration period | 5 years |
Convertible Debt and Other De31
Convertible Debt and Other Debt - Schedule of Convertible Debts and Outstanding Balances (Details) | 9 Months Ended | |
Sep. 30, 2016USD ($) | ||
Loan Amount | $ 2,509,045 | |
Discount related to Fair value of conversion feature and warrants/shares | (20,721) | |
Fixed Rate Convertible Notes [Member] | ||
Loan Amount | 7,229,549 | |
Outstanding Balance | 7,229,549 | |
Original Issue Discount | 680,495 | |
Deferred Finance Fees | 1,158,408 | |
Discount related to Fair value of conversion feature and warrants/shares | $ 6,060,837 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt [Member] | ||
Inception Date | Jul. 22, 2015 | |
Term | 24 months | |
Loan Amount | $ 2,180,000 | |
Outstanding Balance | 2,180,000 | |
Original Issue Discount | $ 218,000 | [1] |
Interest Rate | 10.00% | [2] |
Deferred Finance Fees | $ 388,532 | |
Discount related to Fair value of conversion feature and warrants/shares | $ 2,163,074 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Two [Member] | ||
Inception Date | Sep. 25, 2015 | |
Term | 24 months | |
Loan Amount | $ 1,100,000 | |
Outstanding Balance | 1,100,000 | |
Original Issue Discount | $ 110,000 | [1] |
Interest Rate | 10.00% | [2] |
Deferred Finance Fees | $ 185,956 | |
Discount related to Fair value of conversion feature and warrants/shares | $ 1,022,052 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Three [Member] | ||
Inception Date | Oct. 2, 2015 | |
Term | 24 months | |
Loan Amount | $ 150,000 | |
Outstanding Balance | 150,000 | |
Original Issue Discount | $ 15,000 | [1] |
Interest Rate | 10.00% | [2] |
Deferred Finance Fees | $ 26,345 | |
Discount related to Fair value of conversion feature and warrants/shares | $ 140,832 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Four [Member] | ||
Inception Date | Oct. 6, 2015 | |
Term | 24 months | |
Loan Amount | $ 30,000 | |
Outstanding Balance | 30,000 | |
Original Issue Discount | $ 3,000 | [1] |
Interest Rate | 10.00% | [2] |
Deferred Finance Fees | $ 5,168 | |
Discount related to Fair value of conversion feature and warrants/shares | $ 26,721 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Five [Member] | ||
Inception Date | Oct. 14, 2015 | |
Term | 24 months | |
Loan Amount | $ 50,000 | |
Outstanding Balance | 50,000 | |
Original Issue Discount | $ 5,000 | [1] |
Interest Rate | 10.00% | [2] |
Deferred Finance Fees | $ 8,954 | |
Discount related to Fair value of conversion feature and warrants/shares | $ 49,377 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Six [Member] | ||
Inception Date | Nov. 2, 2015 | |
Term | 24 months | |
Loan Amount | $ 250,000 | |
Outstanding Balance | 250,000 | |
Original Issue Discount | $ 25,000 | [1] |
Interest Rate | 10.00% | [2] |
Deferred Finance Fees | $ 43,079 | |
Discount related to Fair value of conversion feature and warrants/shares | $ 222,723 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Seven [Member] | ||
Inception Date | Nov. 10, 2015 | |
Term | 24 months | |
Loan Amount | $ 50,000 | |
Outstanding Balance | 50,000 | |
Original Issue Discount | $ 5,000 | [1] |
Interest Rate | 10.00% | [2] |
Deferred Finance Fees | $ 8,790 | |
Discount related to Fair value of conversion feature and warrants/shares | $ 46,984 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Eight [Member] | ||
Inception Date | Nov. 12, 2015 | |
Term | 24 months | |
Loan Amount | $ 215,000 | |
Outstanding Balance | 215,000 | |
Original Issue Discount | $ 21,500 | [1] |
Interest Rate | 10.00% | [2] |
Deferred Finance Fees | $ 38,518 | |
Discount related to Fair value of conversion feature and warrants/shares | $ 212,399 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Nine [Member] | ||
Inception Date | Nov. 20, 2015 | |
Term | 24 months | |
Loan Amount | $ 200,000 | |
Outstanding Balance | 200,000 | |
Original Issue Discount | $ 20,000 | [1] |
Interest Rate | 10.00% | [2] |
Deferred Finance Fees | $ 37,185 | |
Discount related to Fair value of conversion feature and warrants/shares | $ 200,000 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Ten [Member] | ||
Inception Date | Dec. 4, 2015 | |
Term | 24 months | |
Loan Amount | $ 170,000 | |
Outstanding Balance | 170,000 | |
Original Issue Discount | $ 17,000 | [1] |
Interest Rate | 10.00% | [2] |
Deferred Finance Fees | $ 37,352 | |
Discount related to Fair value of conversion feature and warrants/shares | $ 170,000 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Eleven [Member] | ||
Inception Date | Dec. 11, 2015 | |
Term | 24 months | |
Loan Amount | $ 360,000 | |
Outstanding Balance | 360,000 | |
Original Issue Discount | $ 36,000 | [1] |
Interest Rate | 10.00% | [2] |
Deferred Finance Fees | $ 75,449 | |
Discount related to Fair value of conversion feature and warrants/shares | $ 360,000 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Tweleve [Member] | ||
Inception Date | Dec. 18, 2015 | |
Term | 24 months | |
Loan Amount | $ 55,000 | |
Outstanding Balance | 55,000 | |
Original Issue Discount | $ 5,500 | [1] |
Interest Rate | 10.00% | [2] |
Deferred Finance Fees | $ 11,714 | |
Discount related to Fair value of conversion feature and warrants/shares | $ 55,000 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Thirteen [Member] | ||
Inception Date | Dec. 31, 2015 | |
Term | 24 months | |
Loan Amount | $ 100,000 | |
Outstanding Balance | 100,000 | |
Original Issue Discount | $ 10,000 | [1] |
Interest Rate | 10.00% | [2] |
Deferred Finance Fees | $ 20,634 | |
Discount related to Fair value of conversion feature and warrants/shares | $ 100,000 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Fourteen [Member] | ||
Inception Date | Jan. 11, 2016 | |
Term | 24 months | |
Loan Amount | $ 100,000 | |
Outstanding Balance | 100,000 | |
Original Issue Discount | $ 10,000 | [1] |
Interest Rate | 10.00% | [2] |
Deferred Finance Fees | $ 24,966 | |
Discount related to Fair value of conversion feature and warrants/shares | $ 80,034 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Fifteen [Member] | ||
Inception Date | Jan. 20, 2016 | |
Term | 24 months | |
Loan Amount | $ 50,000 | |
Outstanding Balance | 50,000 | |
Original Issue Discount | $ 5,000 | [1] |
Interest Rate | 10.00% | [2] |
Deferred Finance Fees | $ 9,812 | |
Discount related to Fair value of conversion feature and warrants/shares | $ 40,188 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Sixteen [Member] | ||
Inception Date | Jan. 29, 2016 | |
Term | 24 months | |
Loan Amount | $ 300,000 | |
Outstanding Balance | 300,000 | |
Original Issue Discount | $ 30,000 | [1] |
Interest Rate | 10.00% | [2] |
Deferred Finance Fees | $ 60,887 | |
Discount related to Fair value of conversion feature and warrants/shares | $ 239,113 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Seventeen [Member] | ||
Inception Date | Feb. 26, 2016 | |
Term | 24 months | |
Loan Amount | $ 200,000 | |
Outstanding Balance | 200,000 | |
Original Issue Discount | $ 20,000 | [1] |
Interest Rate | 10.00% | [2] |
Deferred Finance Fees | $ 18,260 | |
Discount related to Fair value of conversion feature and warrants/shares | $ 156,048 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Eighteen [Member] | ||
Inception Date | Mar. 10, 2016 | |
Term | 24 months | |
Loan Amount | $ 125,000 | |
Outstanding Balance | 125,000 | |
Original Issue Discount | $ 12,500 | [1] |
Interest Rate | 10.00% | [2] |
Deferred Finance Fees | $ 23,260 | |
Discount related to Fair value of conversion feature and warrants/shares | $ 106,740 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Nineteen [Member] | ||
Inception Date | Mar. 18, 2016 | |
Term | 24 months | |
Loan Amount | $ 360,000 | |
Outstanding Balance | 360,000 | |
Original Issue Discount | $ 36,000 | [1] |
Interest Rate | 10.00% | [2] |
Deferred Finance Fees | $ 94,992 | |
Discount related to Fair value of conversion feature and warrants/shares | $ 265,008 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Twenty [Member] | ||
Inception Date | Mar. 24, 2016 | |
Term | 24 months | |
Loan Amount | $ 106,667 | |
Outstanding Balance | 106,667 | |
Original Issue Discount | $ 10,667 | [1] |
Interest Rate | 10.00% | [2] |
Deferred Finance Fees | $ 15,427 | |
Discount related to Fair value of conversion feature and warrants/shares | $ 91,240 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Twenty One [Member] | ||
Inception Date | Mar. 31, 2016 | |
Term | 24 months | |
Loan Amount | $ 167,882 | |
Outstanding Balance | 167,882 | |
Original Issue Discount | $ 16,788 | [1] |
Interest Rate | 10.00% | [2] |
Deferred Finance Fees | $ 2,436 | |
Discount related to Fair value of conversion feature and warrants/shares | $ 165,446 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Twenty Two [Member] | ||
Inception Date | Apr. 5, 2016 | |
Term | 24 months | |
Loan Amount | $ 10,000 | |
Outstanding Balance | 10,000 | |
Original Issue Discount | $ 1,000 | [1] |
Interest Rate | 10.00% | [2] |
Deferred Finance Fees | ||
Discount related to Fair value of conversion feature and warrants/shares | $ 10,000 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Twenty Three [Member] | ||
Inception Date | May 24, 2016 | |
Term | 7 months | |
Loan Amount | $ 100,000 | |
Outstanding Balance | 100,000 | |
Original Issue Discount | $ 7,000 | |
Interest Rate | 0.00% | |
Deferred Finance Fees | ||
Discount related to Fair value of conversion feature and warrants/shares | $ 20,368 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Twenty Four [Member] | ||
Inception Date | Jun. 15, 2016 | |
Term | 6 months | |
Loan Amount | $ 40,000 | |
Outstanding Balance | 40,000 | |
Original Issue Discount | ||
Interest Rate | 12.00% | |
Deferred Finance Fees | ||
Discount related to Fair value of conversion feature and warrants/shares | $ 3,680 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Twenty Five [Member] | ||
Inception Date | Jun. 17, 2016 | |
Term | 6 months | |
Loan Amount | $ 40,000 | |
Outstanding Balance | 40,000 | |
Original Issue Discount | ||
Interest Rate | 12.00% | |
Deferred Finance Fees | ||
Discount related to Fair value of conversion feature and warrants/shares | $ 3,899 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Twenty Six [Member] | ||
Inception Date | Jun. 22, 2016 | |
Term | 6 months | |
Loan Amount | $ 35,000 | |
Outstanding Balance | 35,000 | |
Original Issue Discount | ||
Interest Rate | 12.00% | |
Deferred Finance Fees | ||
Discount related to Fair value of conversion feature and warrants/shares | $ 3,373 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Twenty Seven [Member] | ||
Inception Date | Jul. 6, 2016 | |
Term | 6 months | |
Loan Amount | $ 85,000 | |
Outstanding Balance | 85,000 | |
Original Issue Discount | ||
Interest Rate | 12.00% | |
Deferred Finance Fees | ||
Discount related to Fair value of conversion feature and warrants/shares | $ 15,048 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Twenty Eight [Member] | ||
Inception Date | Jul. 29, 2016 | |
Term | 6 months | |
Loan Amount | $ 100,000 | |
Outstanding Balance | 100,000 | |
Original Issue Discount | ||
Interest Rate | 12.00% | |
Deferred Finance Fees | ||
Discount related to Fair value of conversion feature and warrants/shares | $ 25,518 | |
Fixed Rate Convertible Notes [Member] | Convertible Debt Twenty Nine [Member] | ||
Inception Date | Sep. 15, 2016 | |
Term | 8 months | |
Loan Amount | $ 500,000 | |
Outstanding Balance | 500,000 | |
Original Issue Discount | $ 40,541 | |
Interest Rate | 9.00% | |
Deferred Finance Fees | ||
Discount related to Fair value of conversion feature and warrants/shares | $ 65,972 | |
[1] | The original issue discount is reflected in the first year. | |
[2] | The annual interest starts accruing in the second year. |
Convertible Debt and Other De32
Convertible Debt and Other Debt - Summary of Changes in Convertible Debt, Net of Unamortized Discount (Details) - USD ($) | May 13, 2016 | Sep. 30, 2016 | Dec. 31, 2015 |
Debt Disclosure [Abstract] | |||
Balance at January 1, 2016 | $ 277,342 | ||
Issuance of convertible debt, face value | 2,509,045 | ||
Original issued discount | (189,496) | ||
Debt discount from derivative liabilities (embedded conversion option and warrants) | (1,153,817) | ||
Debt discount from shares and warrants issued with the notes | (117,137) | ||
Debt discount from beneficial conversion feature | (20,721) | ||
Deferred financing fees | (270,732) | ||
Conversion of debentures to common shares | $ 117,837 | (100,000) | |
Accretion of interest and amortization of debt discount to interest expense through September 30, | 2,808,261 | ||
Balance at September 30, | 3,742,745 | ||
Less: current portion | 2,664,334 | $ 100,000 | |
Convertible debt, long-term portion | $ 986,843 | $ 177,342 |
Stockholders' Deficit (Details
Stockholders' Deficit (Details Narrative) - USD ($) | Aug. 29, 2016 | May 13, 2016 | May 06, 2016 | Apr. 22, 2016 | Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | Nov. 29, 2015 | Dec. 31, 2014 | Dec. 12, 2013 |
Convertible preferred stock, authorized | 1,000,000 | 1,000,000 | ||||||||||
Convertible preferred stock, par value | $ 0.01 | $ 0.01 | ||||||||||
Convertible preferred stock, shares issued | 1,000,000 | 1,000,000 | ||||||||||
Common stock, shares outstanding under the plan | 30,093,945 | 30,093,945 | 34,798,914 | 22,588,451 | ||||||||
Estimated fair value of unvested stock options | $ 459,724 | |||||||||||
Stock-based compensation expense | $ 90,500 | $ 74,864 | 282,811 | $ 185,370 | ||||||||
Number of shares connection with cashless exercise of warrants during period | 70,000 | |||||||||||
Number of debt converted into stock | 420,849 | |||||||||||
Valued debt discount to amortized over the term of loan, value | $ 117,837 | $ (100,000) | ||||||||||
Common stock, par value | $ 0.01 | $ 0.01 | $ 0.01 | |||||||||
Securities Purchase Agreement [Member] | ||||||||||||
Warrants to purchase, shares | 1,125,000 | 1,125,000 | ||||||||||
Warrant exercise price per share | $ 0.50 | $ 0.50 | ||||||||||
Warrant expiry term | 5 years | |||||||||||
Lender [Member] | ||||||||||||
Conversion of common stock | 297,500 | |||||||||||
Number of debt converted into stock | 100,049 | |||||||||||
Valued debt discount to amortized over the term of loan, value | $ 41,200 | |||||||||||
Series J Convertible Preferred Stock [Member] | ||||||||||||
Number of preferred stock issued to conversion of common stock | 25 | |||||||||||
Conversion of common stock | 25,000 | |||||||||||
Number of debt converted into stock | 1,112 | |||||||||||
Pay accrued dividend | $ 445 | |||||||||||
Remainder of 2016 [Member] | ||||||||||||
Stock-based compensation expense | 90,445 | |||||||||||
2017 [Member] | ||||||||||||
Stock-based compensation expense | 212,957 | |||||||||||
2018 [Member] | ||||||||||||
Stock-based compensation expense | $ 156,322 | |||||||||||
Three Tranches [Member] | Private Placement [Member] | ||||||||||||
Sale of common stock, shares | 1,125,000 | |||||||||||
Common stock, par value | 0.01 | $ 0.01 | ||||||||||
Purchase price per share | $ 0.40 | $ 0.40 | ||||||||||
Gross proceeds from sale of common stock | $ 450,000 | |||||||||||
Stock issuance costs related to broker and legal fee | $ 67,035 | |||||||||||
2015 Equity Incentive Plan [Member] | ||||||||||||
Common stock reserved for stock option plan | 1,800,000 | 1,800,000 | ||||||||||
Common stock, shares outstanding under the plan | 1,153,750 | 1,153,750 | ||||||||||
Options shares granted | 646,250 | 646,250 | ||||||||||
2013 Equity Incentive Plan [Member] | ||||||||||||
Common stock reserved for stock option plan | 952,500 | 952,500 | 3,000,000 | |||||||||
Options shares granted | 2,047,500 | 2,047,500 | ||||||||||
2015 Nonqualified Stock Option Plan [Member] | ||||||||||||
Common stock reserved for stock option plan | 5,000,000 | |||||||||||
Common stock, shares outstanding under the plan | 2,068,000 | 2,068,000 | ||||||||||
Options shares granted | 2,932,000 | 2,932,000 | ||||||||||
Restricted Stock [Member] | Investor Relations Firms [Member] | ||||||||||||
Number of common stock shares issued for services | 900,000 | |||||||||||
Series A Junior Participating Preferred Stock [Member] | ||||||||||||
Number of stock designated | 20,000 | 20,000 | ||||||||||
Series A Convertible Preferred Stock [Member] | ||||||||||||
Number of stock designated | 313,960 | 313,960 | ||||||||||
Series B Convertible Preferred Stock [Member] | ||||||||||||
Number of stock designated | 279,256 | 279,256 | ||||||||||
Series C Convertible Preferred Stock [Member] | ||||||||||||
Number of stock designated | 88,098 | 88,098 | ||||||||||
Series D Convertible Preferred Stock [Member] | ||||||||||||
Convertible preferred stock, authorized | 850 | 850 | 850 | |||||||||
Convertible preferred stock, par value | $ .01 | $ .01 | $ .01 | |||||||||
Convertible preferred stock, shares issued | 300 | 300 | 300 | |||||||||
Number of stock designated | 850 | 850 | ||||||||||
Series E Convertible Preferred Stock [Member] | ||||||||||||
Number of stock designated | 500 | 500 | ||||||||||
Series G Convertible Preferred Stock [Member] | ||||||||||||
Convertible preferred stock, authorized | 240,000 | 240,000 | 240,000 | |||||||||
Convertible preferred stock, par value | $ 0.01 | $ 0.01 | $ 0.01 | |||||||||
Convertible preferred stock, shares issued | 86,570 | 86,570 | 86,570 | |||||||||
Number of stock designated | 240,000 | 240,000 | ||||||||||
Series H Convertible Preferred Stock [Member] | ||||||||||||
Convertible preferred stock, authorized | 10,000 | 10,000 | 10,000 | |||||||||
Convertible preferred stock, par value | $ 0.01 | $ 0.01 | $ 0.01 | |||||||||
Convertible preferred stock, shares issued | 10,000 | 10,000 | 10,000 | |||||||||
Number of stock designated | 10,000 | 10,000 | ||||||||||
Series H2 Convertible Preferred Stock [Member] | ||||||||||||
Convertible preferred stock, authorized | 21 | 21 | 21 | |||||||||
Convertible preferred stock, par value | $ 0.01 | $ 0.01 | $ 0.01 | |||||||||
Convertible preferred stock, shares issued | 21 | 21 | 21 | |||||||||
Number of stock designated | 21 | 21 | ||||||||||
Series J Convertible Preferred Stock [Member] | ||||||||||||
Convertible preferred stock, authorized | 6,250 | 6,250 | 6,250 | |||||||||
Convertible preferred stock, par value | $ 0.01 | $ 0.01 | $ 0.01 | |||||||||
Convertible preferred stock, shares issued | 3,521 | 3,521 | 3,546 | |||||||||
Number of stock designated | 6,250 | 6,250 | ||||||||||
Series K Convertible Preferred Stock [Member] | ||||||||||||
Convertible preferred stock, authorized | 15,000 | 15,000 | 15,000 | |||||||||
Convertible preferred stock, par value | $ 0.01 | $ 0.01 | $ 0.01 | |||||||||
Convertible preferred stock, shares issued | 6,816 | 6,816 | 11,416 | |||||||||
Number of stock designated | 15,000 | 15,000 | ||||||||||
Number of preferred stock issued to conversion of common stock | 4,600 | |||||||||||
Conversion of common stock | 4,600,000 | |||||||||||
Number of debt converted into stock | 247,435 | |||||||||||
Pay accrued dividend | $ 63,413 |
Stockholders' Deficit - Schedul
Stockholders' Deficit - Schedule of Concerning Options and Warrants Outstanding and Exercisable (Details) - $ / shares | 9 Months Ended | 12 Months Ended |
Sep. 30, 2016 | Dec. 31, 2015 | |
Shares, Beginning balance | 34,798,914 | 22,588,451 |
Shares, Granted | 4,294,552 | 13,337,141 |
Shares, Exercised | (70,000) | |
Shares, Expired | (8,813,521) | (996,678) |
Shares, Forfeited | (116,000) | 130,000 |
Shares, Ending balance | 30,093,945 | 34,798,914 |
Exercisable, Beginning balance | 31,788,590 | 16,611,528 |
Exercisable, Ending balance | 28,095,959 | 31,788,590 |
Stock Option [Member] | ||
Shares, Beginning balance | 5,571,250 | 3,406,250 |
Shares, Granted | 2,500,000 | |
Shares, Exercised | ||
Shares, Expired | (186,000) | (205,000) |
Shares, Forfeited | (116,000) | (130,000) |
Shares, Ending balance | 5,269,250 | 5,571,250 |
Weighted average price per share, Beginning balance | $ 0.44 | $ 0.51 |
Weighted average price per share, Granted | 0.40 | |
Weighted average price per share, Exercised | ||
Weighted average price per share, Expired | 1 | 1 |
Weighted average price per share, Forfeited | 0.51 | 0.70 |
Weighted average price per share, Ending balance | $ 0.42 | $ 0.44 |
Warrants [Member] | ||
Shares, Beginning balance | 29,227,664 | 19,182,201 |
Shares, Granted | 4,294,552 | 10,837,141 |
Shares, Exercised | (70,000) | |
Shares, Expired | (8,627,521) | (791,678) |
Shares, Forfeited | ||
Shares, Ending balance | 24,824,695 | 29,227,664 |
Weighted average price per share, Beginning balance | $ 0.44 | $ 0.49 |
Weighted average price per share, Granted | 0.43 | 0.40 |
Weighted average price per share, Exercised | 0.31 | |
Weighted average price per share, Expired | 0.61 | 0.31 |
Weighted average price per share, Forfeited | ||
Weighted average price per share, Ending balance | $ 0.39 | $ 0.44 |
Stockholders' Deficit - Sched35
Stockholders' Deficit - Schedule of Share-based Compensation Stock Option Plans by Exercise Price Range (Details) | 9 Months Ended |
Sep. 30, 2016$ / sharesshares | |
Exercise Price 1 [Member] | |
Exercise price range, lower range limit | $ 0.30 |
Exercise price range, upper range limit | $ 0.39 |
Options outstanding, number of options | shares | 1,675,500 |
Options outstanding, weighted average remaining contractual life | 8 years |
Options outstanding, weighted average exercise price | $ 0.30 |
Options exercisable, number of options | shares | 1,248,514 |
Options exercisable, weighted average remaining contractual life | 8 years |
Options exercisable, weighted average exercise price | $ 0.30 |
Exercise Price 2 [Member] | |
Exercise price range, lower range limit | 0.40 |
Exercise price range, upper range limit | $ 0.49 |
Options outstanding, number of options | shares | 2,786,000 |
Options outstanding, weighted average remaining contractual life | 9 years |
Options outstanding, weighted average exercise price | $ 0.40 |
Options exercisable, number of options | shares | 1,165,000 |
Options exercisable, weighted average remaining contractual life | 8 years 7 months 6 days |
Options exercisable, weighted average exercise price | $ 0.40 |
Exercise Price 3 [Member] | |
Exercise price range, lower range limit | 0.50 |
Exercise price range, upper range limit | $ 0.59 |
Options outstanding, number of options | shares | 226,250 |
Options outstanding, weighted average remaining contractual life | 5 years 10 months 24 days |
Options outstanding, weighted average exercise price | $ 0.50 |
Options exercisable, number of options | shares | 226,250 |
Options exercisable, weighted average remaining contractual life | 5 years 10 months 24 days |
Options exercisable, weighted average exercise price | $ 0.50 |
Exercise Price 4 [Member] | |
Exercise price range, lower range limit | 0.60 |
Exercise price range, upper range limit | $ 0.69 |
Options outstanding, number of options | shares | 385,500 |
Options outstanding, weighted average remaining contractual life | 3 years 4 months 24 days |
Options outstanding, weighted average exercise price | $ 0.60 |
Options exercisable, number of options | shares | 385,500 |
Options exercisable, weighted average remaining contractual life | 3 years 4 months 24 days |
Options exercisable, weighted average exercise price | $ 0.60 |
Exercise Price 5 [Member] | |
Exercise price range, lower range limit | 0.70 |
Exercise price range, upper range limit | $ 1.25 |
Options outstanding, number of options | shares | 246,000 |
Options outstanding, weighted average remaining contractual life | 2 years 7 months 6 days |
Options outstanding, weighted average exercise price | $ 1 |
Options exercisable, number of options | shares | 246,000 |
Options exercisable, weighted average remaining contractual life | 2 years 7 months 6 days |
Options exercisable, weighted average exercise price | $ 1 |
Exercise Price 6 [Member] | |
Exercise price range, lower range limit | 0.30 |
Exercise price range, upper range limit | $ 1.25 |
Options outstanding, number of options | shares | 5,269,250 |
Options outstanding, weighted average remaining contractual life | 7 years 9 months 18 days |
Options outstanding, weighted average exercise price | $ 0.42 |
Options exercisable, number of options | shares | 3,271,264 |
Options exercisable, weighted average remaining contractual life | 7 years 1 month 6 days |
Options exercisable, weighted average exercise price | $ 0.44 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - USD ($) | Nov. 02, 2016 | Oct. 28, 2016 | Sep. 30, 2016 | Dec. 31, 2015 |
Common stock, par value | $ 0.01 | $ 0.01 | ||
Debt principal amount | $ 2,509,045 | |||
Subsequent Event [Member] | Consulting Agreement [Member] | ||||
Warrants to purchase, shares | 660,000 | |||
Warrant exercise price per share | $ 0.40 | |||
Subsequent Event [Member] | Promissory Note [Member] | ||||
Warrants to purchase, shares | 625,000 | 625,000 | ||
Warrant exercise price per share | $ 0.40 | |||
Debt principal amount | $ 2,000,000 | |||
Debt matures date | Oct. 28, 2017 | |||
Due to related parties | $ 250,000 | $ 250,000 | ||
Subsequent Event [Member] | Promissory Note [Member] | Prior Date One [Member] | ||||
Debt matures date | Apr. 28, 2017 | |||
Principal payment of prior percentage | 10.00% | |||
Subsequent Event [Member] | Promissory Note [Member] | Prior Date Two [Member] | ||||
Principal payment of prior percentage | 4.00% | |||
Debt maturity date description | April 28, 2017 and July28, 2017 | |||
Subsequent Event [Member] | Promissory Note [Member] | Prior Date Three [Member] | ||||
Principal payment of prior percentage | 4.00% | |||
Debt maturity date description | July 28, 2017 and October 28, 2017 | |||
Subsequent Event [Member] | Promissory Note [Member] | Minimum [Member] | ||||
Due to related parties | 250,000 | |||
Subsequent Event [Member] | Promissory Note [Member] | Maximum [Member] | ||||
Due to related parties | $ 500,000 | |||
Subsequent Event [Member] | Tranche One [Member] | Consulting Agreement [Member] | ||||
Number of warrants vested, shares | 330,000 | |||
Subsequent Event [Member] | Tranches Two [Member] | Consulting Agreement [Member] | ||||
Number of warrants vested, shares | 330,000 | |||
Subsequent Event [Member] | Private Placement [Member] | Two Tranches [Member] | ||||
Sale of common stock, shares | 400,000 | |||
Common stock, par value | $ 0.01 | |||
Purchase price per share | $ 0.40 | |||
Gross proceeds from sale of stock | $ 160,000 | |||
Warrants to purchase, shares | 400,000 | |||
Warrant exercise price per share | $ 0.50 | |||
Warrant expire term | 5 years |