Document_And_Entity_Informatio
Document And Entity Information | 3 Months Ended | |
Mar. 31, 2015 | 15-May-15 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | FALSE | |
Document Period End Date | 31-Mar-15 | |
Document Fiscal Year Focus | 2015 | |
Document Fiscal Period Focus | Q1 | |
Entity Registrant Name | NaturalNano, Inc. | |
Entity Central Index Key | 863895 | |
Current Fiscal Year End Date | -19 | |
Entity Filer Category | Smaller Reporting Company | |
Trading Symbol | NNAN | |
Entity Common Stock, Shares Outstanding | 2,093,502 |
CONDENSED_CONSOLIDATED_BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash | $66 | $0 |
Accounts Receivable | 4,347 | 5,036 |
Inventory | 196,731 | 231,764 |
Prepaid expenses and other current assets | 24,292 | 73,140 |
Total current assets | 225,436 | 309,940 |
Total Assets | 225,436 | 309,940 |
Current Liabilities | ||
Notes payable (Note 2) | 1,595,941 | 1,534,946 |
Accounts payable | 471,019 | 572,128 |
Accrued expenses | 119,233 | 97,095 |
Accrued interest | 305,037 | 239,937 |
Accrued payroll | 1,099,948 | 1,068,448 |
Registration rights liability | 12,324 | 12,324 |
Derivative liabilities | 241,444 | 387,721 |
Total current liabilities | 3,844,946 | 3,912,599 |
Total Liabilities | 3,844,946 | 3,912,599 |
Rights to reserved common shares (Note 2) | 343,350 | 559,289 |
Preferred Stock - $.001 par value, 10 million shares authorized | 1,715 | 2,131 |
Commitments and contingencies | ||
Stockholders' Deficiency | ||
Common Stock - $.001 par value 800,000,000 authorized with 2,093,502 shares issued and outstanding | 2,094 | 2,094 |
Additional paid in capital | 21,731,892 | 21,454,431 |
Accumulated deficit | -25,698,561 | -25,620,604 |
Total stockholders' deficiency | -3,964,575 | -4,164,079 |
Total liabilities and stockholders' deficiency | 225,436 | 309,940 |
Series D Preferred Stock [Member] | ||
Stockholders' Deficiency | ||
Series D - issued and outstanding 100 shares | $0 | $0 |
CONDENSED_CONSOLIDATED_BALANCE1
CONDENSED CONSOLIDATED BALANCE SHEETS [Parenthetical] (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
Temporary Equity, Par value (in dollars per share) | $0.01 | $0.01 |
Temporary Equity, Shares Authorized | 10,000,000 | 10,000,000 |
Temporary Equity, Shares Issued | 5,000 | 5,000 |
Temporary Equity, Shares Outstanding | 5,000 | 5,000 |
Temporary Equity, Liquidation Preference (in dollars) | $10 | $10 |
Common Stock, par value (in dollars per share) | $0.00 | $0.00 |
Common Stock, shares authorized | 800,000,000 | 800,000,000 |
Common Stock, shares issued | 2,093,502 | 2,093,502 |
Common Stock, shares outstanding | 2,093,502 | 2,093,502 |
Series D Preferred Stock [Member] | ||
Preferred Stock, shares issued | 100 | 100 |
Preferred Stock, shares outstanding | 100 | 100 |
CONDENSED_CONSOLIDATED_STATEME
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Income: | ||
Revenue | $115,085 | $3,640 |
Cost of goods sold | 27,408 | 485 |
Gross profit | 87,677 | 3,155 |
Operating expenses: | ||
Research and development | 3,284 | 10,735 |
Selling, general and administrative excluding stock based compensation | 190,326 | 94,145 |
Stock based compensation attributed to warrant grants | 61,106 | 0 |
Total operating expenses | 254,716 | 104,880 |
Loss from Operations | -167,039 | -101,725 |
Other income (expense): | ||
Interest expense, net | -65,095 | -95,547 |
Gain (loss) on change in derivative liability | 146,277 | -26,308 |
Gain (loss) on forgiveness and modifications of debt | 7,900 | -40,000 |
Total other income (expense) | 89,082 | -161,855 |
Loss before income taxes | -77,957 | -263,580 |
Income taxes | 0 | 0 |
Net loss | ($77,957) | ($263,580) |
Loss per common share- basic and diluted | ($0.04) | ($0.14) |
Weighted average shares outstanding | 2,093,502 | 1,937,262 |
CONDENSED_CONSOLIDATED_STATEME1
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY DEFICIENCY (USD $) | Total | Common Stock [Member] | Series D Preferred Stock [Member] | Additional Paid in Capital [Member] | Retained Earnings [Member] |
Balance at Dec. 31, 2014 | ($4,164,079) | $2,094 | $0 | $21,454,431 | ($25,620,604) |
Balance (in shares) at Dec. 31, 2014 | 2,093,502 | 100 | |||
Series B preferred shares change in value | 416 | 0 | 0 | 416 | 0 |
Warrants issued for services | 61,106 | 0 | 0 | 61,106 | 0 |
Change in value to rights to common shares | 215,939 | 0 | 0 | 215,939 | |
Net loss for the three months ended March 31, 2015 | -77,957 | 0 | 0 | 0 | -77,957 |
Balance at Mar. 31, 2015 | ($3,964,575) | $2,094 | $0 | $21,731,892 | ($25,698,561) |
Balance (in shares) at Mar. 31, 2015 | 2,093,502 | 100 |
CONDENSED_CONSOLIDATED_STATEME2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Cash flows from operating activities: | ||
Consolidated net (loss) | ($77,957) | ($263,580) |
Adjustments to reconcile net (loss) to net cash used in operating activities: | ||
Net (gain) loss on extinguishment/modification of debt | -7,900 | 40,000 |
Change in fair value of derivative liabilities | -146,277 | 26,308 |
Issuance of warrants for services | 61,106 | 0 |
Changes in operating assets and liabilities: | ||
Decrease in accounts receivable | 689 | 10,956 |
Decrease (increase) in inventory | 35,033 | -5,479 |
Decrease in prepaid expenses and other current assets | 48,848 | 0 |
Increase in accounts payable and accrued expenses | 25,524 | 78,803 |
Increase in deferred revenue | 0 | 40,745 |
Net cash used in operating activities | -60,934 | -72,247 |
Cash flows from investing activities | ||
Receivable from MJ Enterprises | 0 | -200,000 |
Net cash used in investing activities | 0 | -200,000 |
Cash flows from financing activities | ||
Proceeds from senior secured promissory notes | 61,000 | 280,000 |
Net cash provided by financing activities | 61,000 | 280,000 |
Increase in cash | 66 | 7,753 |
Cash at beginning of period | 0 | 0 |
Cash at end of period | $66 | $7,753 |
PRINCIPAL_BUSINESS_ACTIVITY_AN
PRINCIPAL BUSINESS ACTIVITY AND SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended | ||
Mar. 31, 2015 | |||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Organization, Consolidation and Presentation of Financial Statements Disclosure and Significant Accounting Policies [Text Block] | 1 | PRINCIPAL BUSINESS ACTIVITY AND SIGNIFICANT ACCOUNTING POLICIES | |
Interim Financial Statements | |||
The condensed consolidated financial statements as of March 31, 2015 and for the three months ended March 31, 2015 and 2014 are unaudited. However, in the opinion of management of the Company, these condensed consolidated financial statements reflect all material adjustments, consisting solely of normal recurring adjustments, necessary to present fairly the consolidated financial position and results of operations for such interim periods. The results of operations for the interim periods presented are not necessarily indicative of the results to be obtained for a full year. The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X for smaller reporting companies. Accordingly, these condensed consolidated financial statements do not include all of the information required by U.S. generally accepted accounting principles for complete financial statements. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014. | |||
Liquidity and Going Concern | |||
Going Concern – The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company generated a net loss for the three months ended March 31, 2015 of approximately $78,000, had negative working capital of approximately $3,620,000 and a stockholders’ deficiency of approximately $3,965,000 at March 31, 2015. Since inception the Company’s growth has been funded through a combination of convertible and non-convertible debt from private investors and from cash advances from its former parent Technology Innovations, LLC. These factors, among others, may indicate that the Company will be unable to continue as a going concern for a reasonable period of time. The Company's continuation as a going concern is dependent upon its ability to generate sufficient cash flow to meet its obligations, to obtain additional financing, renegotiate the terms of existing financing obligations and ultimately to attain successful operations. The ability to successfully achieve those items is uncertain. The financial statements do not include any adjustments that might result from the uncertainty. | |||
As of March 31, 2015, the Company continued to require waivers for debt covenant violations and extensions of maturity dates. Refer to Note 2 for lenders waivers and maturity extensions received from the lenders. | |||
Basis of Consolidation | |||
The condensed consolidated financial statements include the accounts of NaturalNano, Inc. (“NaturalNano” or the “Company”), a Nevada corporation, and its wholly owned subsidiaries NaturalNano Research, Inc. (“NN Research”) a Delaware corporation. All significant inter-company accounts and transactions have been eliminated in consolidation. | |||
Description of the Business | |||
Nanotechnology | |||
The Company, located in Rochester, New York, is engaged in the development and commercialization of material science technologies with an emphasis on additives to polymers and other industrial and consumer products by taking advantage of technology advances developed in-house. The Company’s current activities are directed toward research, development, production and marketing of its proprietary technologies relating to the treatment and separation of nanotubes from halloysite clay and the development of related commercial applications for cosmetics, health and beauty products and polymers, plastics and composites. | |||
ViralProtec | |||
In the fourth quarter of 2014, the Company announced the new business line, ViralProtec, (www.viralprotec.com) a division of NaturalNano. ViralProtec, is a reseller for healthcare personal protective equipment (PPE) and ancillary supplies. Our mission is to provide personal protective equipment for caregivers for infectious patient care that meet or exceed CDC and WHO guidelines. ViralProtec was created in response of the public concern and publicity surrounding the risk to caregivers and other responders created by the Ebola virus. The Company will maintain inventory on hand for customers to order complete protection kits from a single source instead multiple sources. | |||
Estimates | |||
The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and assumptions that affect the amounts reported and disclosed in the financial statements and the accompanying notes. Actual results could differ materially from these estimates. On an ongoing basis, we evaluate such estimates. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. | |||
Fair Value of Financial Instruments | |||
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Fair Value Measurement Topic of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) establishes a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include: | |||
· | Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. | ||
· | Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument. | ||
· | Level 3 inputs are unobservable inputs based on the Company’s own assumptions used to measure assets and liabilities at fair value. | ||
A financial asset or liability’s classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. The carrying amounts reported in the balance sheet of cash, accounts receivable, prepaids, accounts payable and accrued expenses approximate fair value because of the immediate or short-term maturity of these financial instruments. The fair value of notes payable approximates their carrying value as the terms of this debt reflects market conditions. The Company’s derivative liability was determined utilizing Level 3 inputs. | |||
Derivative Financial Instruments | |||
The Company does not use derivative instruments to hedge exposures to cash flow, market or foreign currency risks. The Company evaluates all of its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and then is revalued at each reporting date, with changes in fair value reported in the consolidated statement of operations. For stock based derivative financial instruments, the Company estimated the total enterprise value based upon trending the firm value from December 2006 to March 2015 considering company specific factors including the changes in forward estimated revenues and market factors, market multiples for comparable companies, and the Company’s market share price, all equally weighted. Once the enterprise value was determined an option pricing model was used to allocate the enterprise value to the individual derivative securities in the Company’s capital structure. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or equity, is evaluated at the end of each reporting period. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within twelve months of the balance sheet date. | |||
Reclassifications | |||
Certain prior year amounts have been reclassified to conform to the current year presentation. | |||
Income Taxes | |||
The Company accounts for income taxes in accordance with FASB ASC 740 which requires recognition of estimated income taxes payable or refundable on income tax returns for the current year and for the estimated future tax effect attributable to temporary differences and carry-forwards. Measurement of deferred income items is based on enacted tax laws including tax rates, with the measurement of deferred income tax assets being reduced by available tax benefits not expected to be realized. The Company recognizes penalties and accrued interest related to unrecognized tax benefits in income tax expense. Income tax expense was $0 for the three month periods ending March 31, 2015 and 2014. | |||
Loss Per Share | |||
Loss per common share is computed by dividing net income or loss by the weighted-average number of shares of common stock outstanding during the period. Diluted income or loss per common share gives effect to dilutive convertible preferred stock, convertible debt, options and warrants outstanding during the period. Shares to be issued upon the exercise of these instruments have not been included in the computation of diluted loss per share as their effect is anti-dilutive based on the net loss incurred. | |||
As of March 31, 2015 and 2014 there were 9,130,044 and 6,720,340 shares, respectively, underlying preferred stock, convertible debt, outstanding options and warrants that could potentially dilute future earnings. In addition to these potentially dilutive shares as of March 31, 2015 were an additional 6,666,667 reserved shares underlying the July 23, 2014 Exchange and Right to Shares Agreement with Cape One Master Fund II LLP further described in Note 2 below. | |||
These potentially dilutive shares have been limited by certain debt and equity agreements with lenders. These agreements provide limitations on the conversion of the dilutive instruments such that the number of shares of Common Stock that may be acquired by the holder upon conversion of such instruments shall be limited to ensure that following such conversion the total number of shares of Common Stock then beneficially owned by the holder does not exceed 4.99% of the total number of issued and outstanding shares of Common Stock. The Company does not have sufficient authorized shares to satisfy conversion of all the potentially dilutive instruments. | |||
Recent Accounting Pronouncements | |||
FASB ASU 2015-3, Interest—Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs ASU 2015-3 is effective for the annual period ending after December 15, 2015. Early adoption is permitted provided that the guidance is applied from the beginning of the fiscal year of adoption. | |||
FASB ASU 2015-1, Income Statement—Extraordinary and Unusual Items (Subtopic 225-20): Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items This ASU eliminates from GAAP the concept of extraordinary items. ASU 2015-1 is effective for the annual period ending after December 15, 2015. Early adoption is permitted provided that the guidance is applied from the beginning of the fiscal year of adoption. | |||
FASB ASU 2014-12, Compensation—Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (a consensus of the FASB Emerging Issues Task Force). ASU 2014-12 requires a performance target that affects vesting and that could be achieved after the requisite service period to be treated as a performance condition. To account for such awards, a reporting entity should apply existing guidance in FASB Accounting Standards Codification Topic 718, Compensation – Stock Compensation, as it relates to awards with performance conditions that affect vesting. ASU 2014-12 is effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. | |||
NOTES_PAYABLE
NOTES PAYABLE | 3 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Debt Disclosure [Abstract] | ||||||||
Debt Disclosure [Text Block] | 2 | NOTES PAYABLE | ||||||
Notes payable consisted of the following: | ||||||||
Notes Payable | March 31, | December 31, | ||||||
2015 | 2014 | |||||||
Senior Secured Convertible Notes | $ | 441,988 | $ | 441,988 | ||||
Senior Secured Promissory Notes | 398,938 | 398,938 | ||||||
2014-2015 Convertible Promissory Notes | 755,015 | 694,020 | ||||||
$ | 1,595,941 | $ | 1,534,946 | |||||
Senior Secured Convertible Notes and Senior Secured Promissory Notes | ||||||||
As of March 31, 2015 and December 31, 2014 Notes payable on the balance sheets includes $840,926 for senior secured convertible and non-convertible senior secured promissory notes. The conversion rate for principal and accrued interest on Senior Secured Convertible Notes is 75% of the lowest volume weighted average price (VWAP) of the Company’s common stock for the 1, 5 or 10 days immediately prior to the conversion. As further described below, the Company has defaulted on certain provisions of the notes. The Company has obtained a waiver of default on the outstanding principal through June 30, 2015. As a condition of this forbearance the interest rate on certain of these notes has been increased to 18%. | ||||||||
2014-2015 Senior Secured Promissory Notes | ||||||||
During the first quarter of 2015, the Company entered into two Senior Secured Convertible Promissory Notes aggregating $61,000. The 2014-2015 Senior Secured Promissory Notes are secured by, among other things, (i) the continuing security interest in certain assets of the Company pursuant to the terms of the Initial Notes dated March 7, 2007, (ii) the Pledge Agreement, as defined in the Initial Notes, and (iii) the Patent Security Agreement, dated as of March 6, 2007. The proceeds from the 2014-2015 Senior Secured Promissory Notes are available for general working capital purposes and cannot be used to redeem or make any payment on account of any securities due to the Lenders. The Company has obtained a waiver of default on the outstanding principal through June 30, 2015. As a condition of this forbearance the interest rate on certain of these notes has been increased to 18%. | ||||||||
Subordinated Secured Convertible Note and Exchange and Right to Shares Agreement – Cape One Master Fund II LP | ||||||||
On July 23, 2014, the Company and Cape One Master Fund II LLP agreed to exchange the Subordinated Secured Convertible Note and related accrued and unpaid interest totaling a combined $379,624 in exchange for 6,666,667 reserved shares of the Company’s common stock. The Company and Cape One agreed that a beneficial ownership limitation of 4.99% shall be maintained at all times as to the number of the shares of the common stock outstanding immediately after giving effect to the issuance of the common stock issuable under this agreement. Cape One also agreed to a Lockup provision in the agreement that specifies that Cape One will not sell, transfer or hypothecate any of the reserved shares until Alpha Capital Anstalt has received $3,500,000 from the proceeds of sales of shares obtained upon conversion of notes issued by the Company and held by Alpha as of the date of this agreement. Upon expiration of the Lockup period, Cape One shall be allowed to sell the lesser of (i) 5% of the daily trading volume of the Company’s common stock or, (ii) 10% of the reserved shares in any calendar month. | ||||||||
The Company estimated the total enterprise value based upon a combination of the trending of the firm value from December 2006 to March 2015, market comparables and the market value of the Company’s stock considering company specific factors including the changes in forward estimated revenues and market factors. Once the enterprise value was determined an option pricing model was used to allocate the enterprise value to these 6,666,667 share rights and other securities in the Company’s capital structure. The fair value of these 6,666,667 share rights was estimated at $343,350 as of March 31, 2015 based on the excess of the value of the instruments settled over the estimated fair market value of the share rights granted. The change in fair market value of this rights liability of $215,939 has been reflected in Additional Paid In Capital. As a result of the Company not having sufficient authorized shares to satisfy the issuance of these 6,666,667 share rights, conversion of all outstanding convertible debt, convertible preferred stock, warrants and options, the value of these share rights has been presented in temporary equity classification on the balance sheets. | ||||||||
During the three month period ended March 31, 2014, the Company entered into forbearance agreements with Cape One which extended the due dates of certain outstanding notes and accrued interest. As consideration for this forbearance, the lender increased its principal balance outstanding by $40,000. This amount was added to the principal balance of the Initial Notes and the Company recognized a loss on modification of debt of $40,000 in the three month period ended March 31, 2014. | ||||||||
SEGMENT_INFORMATION
SEGMENT INFORMATION | 3 Months Ended | |||||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||||||
Segment Reporting Disclosure [Text Block] | 3 | SEGMENT INFORMATION | ||||||||||||||||||
The Company's reportable segments are strategic business units that offer different products and services. The Company’s reportable segments are organized, managed and internally reported separately because each business requires different technology and marketing strategies. The Company currently has two operating segments, Nanotechnology and ViralProtec. A summary of the two segments is as follows: | ||||||||||||||||||||
Nanotechnology | Research, development, production and marketing of its proprietary technologies relating to the treatment and separation of nanotubes from halloysite clay and the development of related commercial applications for cosmetics, health and beauty products and polymers, plastics and composites. | |||||||||||||||||||
ViralProtec | Distributor and reseller of personal protective equipment and supplies to protect medical workers from infection and contagious incidents. | |||||||||||||||||||
The accounting policies of the segments are the same as those described in the summary of significant accounting policies of the Company. The Company accounts for intersegment sales and transfers as if the sales or transfers were to third parties, that is, at current market prices. The Company relies on intersegment cooperation and management does not represent that these segments, if operated independently, would report the results contained herein. For purposes of determining segment loss, corporate overhead is primarily included in Nanotechnology, other than direct expense of ViralProtec. Approximate information concerning the Company’s operations by reportable segment for the three months ended March 31, 2015 and March 31, 2014 is as follows: | ||||||||||||||||||||
Nanotechnology | ViralProtec | Consolidated | ||||||||||||||||||
For the three months ended | For the three months ended | For the three months ended | ||||||||||||||||||
March 31, | March 31, | March 31, | March 31, | March 31, | March 31, | |||||||||||||||
2015 | 2014 | 2015 | 2014 | 2015 | 2014 | |||||||||||||||
Revenue | $ | 67,827 | $ | 3,640 | $ | 47,258 | - | $ | 115,085 | $ | 3,640 | |||||||||
Loss from operations | $ | -180,260 | $ | -101,725 | $ | 13,221 | - | $ | -167,039 | $ | -101,725 | |||||||||
Interest expense | -65,095 | -95,547 | - | - | -65,095 | -95,547 | ||||||||||||||
Net gain (loss) on derivative liabilities | 146,277 | -26,308 | - | - | 146,277 | -26,308 | ||||||||||||||
Gain (loss) on forgiveness /modification of debt | 7,900 | -40,000 | - | - | 7,900 | -40,000 | ||||||||||||||
Income (loss) | $ | -91,178 | $ | -263,580 | $ | 13,221 | - | $ | -77,957 | $ | -263,580 | |||||||||
Assets | $ | 40,738 | $ | 309,940 | $ | 184,698 | - | $ | 225,436 | $ | 309,940 | |||||||||
Geographic Areas – The Company had no long-lived assets in any country other than the United States for any period presented. The Company had $9,600 in sales outside of the United States in the first quarter of 2015. | ||||||||||||||||||||
Major Customers – During the three months ended March 31, 2015, the Company derived 58% of total revenue from one Nanotechnology customer and 15% from one ViralProtec customer. During the three months ended March 31, 2014, the Company derived 100% of total revenue from one Nanotechnology customer. | ||||||||||||||||||||
DERIVATIVE_LIABILITY
DERIVATIVE LIABILITY | 3 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||
Derivative Instruments and Hedging Activities Disclosure [Text Block] | 4 | DERIVATIVE LIABILITY | ||||||
For stock based derivative financial instruments, the Company estimated the total enterprise value based upon a combination of the trending of the firm value from December 2006 to March 2015, market comparables, and the market value of the Company’s stock, considering company specific factors including the changes in forward estimated revenues and market factors. Once the enterprise value was determined an option pricing model was used to allocate the enterprise value to the individual derivative and other securities in the Company’s capital structure. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or equity, is evaluated at the end of each reporting period. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within twelve months of the balance sheet date. | ||||||||
The Company’s derivative liabilities as of March 31, 2015 and December 31, 2014 are as follows: | ||||||||
· | The debt conversion feature embedded in the various Convertible Promissory Notes which contain anti-dilution provisions that would be triggered if the Company issued instruments with rights to the Company’s common stock at prices below this exercise price (described in Note 2.) | |||||||
· | Derivative liabilities related to outstanding warrants and options due to the Company having insufficient authorized shares to satisfy the exercise or conversion of all outstanding instruments as of March 31, 2015 and December 31, 2014. | |||||||
The fair value of the derivative liabilities as of March 31, 2015 and December 31, 2014 are as follows: | ||||||||
March 31, | December 31, | |||||||
2015 | 2014 | |||||||
Note conversion feature liabilities | $ | 236,690 | $ | 375,949 | ||||
Warrant liability | 4,754 | 11,772 | ||||||
Total | $ | 241,444 | $ | 387,721 | ||||
The change in the fair value of the derivative liability of $146,277 was recognized as a gain on change in derivative liability in the statement of operations for the three months ended March 31, 2015. A change in fair value of the derivative liability of $26,308 was recognized as a loss for the three months ended March 31, 2014. Significant fluctuations in the variables used in calculating the value of the Company’s derivative liabilities could have significant impact on the fair market valuation. | ||||||||
STOCKHOLDERS_EQUITY
STOCKHOLDERS EQUITY | 3 Months Ended | ||||||||||
Mar. 31, 2015 | |||||||||||
Stockholders' Equity Note [Abstract] | |||||||||||
Stockholders' Equity Note Disclosure [Text Block] | 5 | STOCKHOLDERS EQUITY | |||||||||
As of March 31, 2015 the Company was authorized to issue up to 800,000,000 shares of common stock and 10,000,000 shares of preferred stock. | |||||||||||
Authorized Common Stock: In 2013 the Company received a unanimous written consent in lieu of a meeting from the members of the Board of Directors and a written consent from the Series D stockholder to amend its articles of incorporation to increase the Company’s authorized common shares to 800,000,000 common shares. As of March 31, 2015 there were 9,130,044 shares underlying preferred stock, convertible debt, outstanding options and warrants that could potentially dilute future earnings. In addition to these potentially dilutive shares were an additional 6,666,667 reserved shares underlying the July 23, 2014 Exchange and Right to Shares Agreement with Cape One Master Fund II LLP further described in Note 2. The Company does not have sufficient authorized shares to satisfy conversion of all the potentially dilutive instruments. | |||||||||||
Preferred Stock Issuances | |||||||||||
The Series B Convertible Preferred Stock is convertible into 160 shares of the Company’s common stock and votes on an as-converted basis (with each share having 160 votes). The Series B designation limits the holders’ rights to convert its Convertible Preferred Stock, and the aggregate voting powers, to no more than 4.99% of the votes attributable to the total outstanding common shares. As a result of the Company not having sufficient authorized shares to satisfy the conversion of all outstanding convertible debt, share rights, convertible preferred stock, warrants and options, the Series B preferred shares have been moved into temporary equity classification on the balance sheet. | |||||||||||
Warrants Grants | |||||||||||
The Company has issued warrants to purchase shares of its common stock to certain consultants and debt holders. As of March 31, 2015 and December 31, 2014 there were common stock warrants outstanding to purchase an aggregate of 845,294 and 545,294 shares of common stock, respectively, pursuant to the warrant grant agreements. | |||||||||||
On February 15, 2015, the Company granted a total of 300,000 warrants to the Company’s board members. These warrants, included in the summary below, grant the right to purchase one share of common stock at an exercise price of $0.10 per share. The warrants were fully vested as of the grant date and contain a cashless exercise provision. The fair value of the warrants on the date of grant was determined using the Black-Scholes model and was measured on the date of grant at $61,106. An expected volatility assumption of 140% was used based on the volatility of the Company’s stock price utilizing a look-back basis and the risk-free interest rate of 1.62% which was derived from the U.S. treasury yields on the date of grant. The market price of the Company’s common stock on the grant date was $0.22 per share. The expiration date used in the valuation model aligns with the warrant life of five years as indicated in the agreements. The dividend yield was assumed to be zero. | |||||||||||
A summary of the outstanding warrants is presented below: | |||||||||||
2015 | |||||||||||
Shares | Weighted | Weighted | |||||||||
Average | Average | ||||||||||
Exercise | Remaining | ||||||||||
Price | Life-years | ||||||||||
Outstanding at January 1, 2015 | 545,294 | $ | 4.26 | 2.24 | |||||||
Granted | 300,000 | 0.1 | |||||||||
Warrants outstanding at March 31, 2015 | 845,294 | $ | 0.77 | 4.75 | |||||||
Warrants exercisable at March 31, 2015 | 845,294 | $ | 0.77 | 4.75 | |||||||
INCENTIVE_STOCK_PLANS
INCENTIVE STOCK PLANS | 3 Months Ended | ||||||||||
Mar. 31, 2015 | |||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | 6 | INCENTIVE STOCK PLANS | |||||||||
A summary of the status of the outstanding incentive stock plans is presented below: | |||||||||||
Shares | Weighted | Weighted Average | |||||||||
Average | Remaining | ||||||||||
Exercise Price | Life-years | ||||||||||
Options outstanding at January 1, 2015 | 2,363 | $ | 921 | 3.53 | |||||||
Options expired unexercised | 907 | ||||||||||
Options outstanding at March 31, 2015 | 1,456 | $ | 1,578.00 | 1.44 | |||||||
Options exercisable at March 31, 2015 | 1,456 | $ | 1,578.00 | ||||||||
All compensation costs for the above options have been previously recognized in operations. As of March 31, 2015, the aggregate intrinsic value of the stock options outstanding and exercisable was $0. There were no option grants made in the three month periods ended March 31, 2015 and 2014. | |||||||||||
REVERSE_STOCK_SPLIT
REVERSE STOCK SPLIT | 3 Months Ended | |
Mar. 31, 2015 | ||
Reverse Stock Split Abstract [Abstract] | ||
Reverse Stock Split [Text Block] | 7 | REVERSE STOCK SPLIT |
On December 19, 2014, the Company filed a Certificate of Amendment to its Restated Certificate of Incorporation, as amended, with the Secretary of State of the State of Nevada, to effect a 1-for-300 reverse stock split of its common stock, or the Reverse Stock Split. This action had previously been approved by the Company’s Board of Directors on November 4, 2014. As a result of the Reverse Stock Split, every three hundred shares of the Company’s pre-reverse split common stock were combined and reclassified into one share of its common stock. No fractional shares were issued in connections with the Reverse Stock Split. Stockholders who would have been entitled to receive a fractional share in connection with the Reverse Stock Split received one whole share. The par value and other terms of the common stock were not affected by the Reverse Stock Split. | ||
The Company’s common stock began trading at its post-Reverse Stock Split price at the beginning of trading on December 23, 2014. | ||
PRINCIPAL_BUSINESS_ACTIVITY_AN1
PRINCIPAL BUSINESS ACTIVITY AND SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended | ||
Mar. 31, 2015 | |||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Interim Financial Statements [Policy Text Block] | Interim Financial Statements | ||
The condensed consolidated financial statements as of March 31, 2015 and for the three months ended March 31, 2015 and 2014 are unaudited. However, in the opinion of management of the Company, these condensed consolidated financial statements reflect all material adjustments, consisting solely of normal recurring adjustments, necessary to present fairly the consolidated financial position and results of operations for such interim periods. The results of operations for the interim periods presented are not necessarily indicative of the results to be obtained for a full year. The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X for smaller reporting companies. Accordingly, these condensed consolidated financial statements do not include all of the information required by U.S. generally accepted accounting principles for complete financial statements. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014. | |||
Liquidity Disclosure [Policy Text Block] | Liquidity and Going Concern | ||
Going Concern – The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company generated a net loss for the three months ended March 31, 2015 of approximately $78,000, had negative working capital of approximately $3,620,000 and a stockholders’ deficiency of approximately $3,965,000 at March 31, 2015. Since inception the Company’s growth has been funded through a combination of convertible and non-convertible debt from private investors and from cash advances from its former parent Technology Innovations, LLC. These factors, among others, may indicate that the Company will be unable to continue as a going concern for a reasonable period of time. The Company's continuation as a going concern is dependent upon its ability to generate sufficient cash flow to meet its obligations, to obtain additional financing, renegotiate the terms of existing financing obligations and ultimately to attain successful operations. The ability to successfully achieve those items is uncertain. The financial statements do not include any adjustments that might result from the uncertainty. | |||
As of March 31, 2015, the Company continued to require waivers for debt covenant violations and extensions of maturity dates. Refer to Note 2 for lenders waivers and maturity extensions received from the lenders. | |||
Consolidation, Policy [Policy Text Block] | Basis of Consolidation | ||
The condensed consolidated financial statements include the accounts of NaturalNano, Inc. (“NaturalNano” or the “Company”), a Nevada corporation, and its wholly owned subsidiaries NaturalNano Research, Inc. (“NN Research”) a Delaware corporation. All significant inter-company accounts and transactions have been eliminated in consolidation. | |||
Business Description [Policy Text Block] | Description of the Business | ||
Nanotechnology | |||
The Company, located in Rochester, New York, is engaged in the development and commercialization of material science technologies with an emphasis on additives to polymers and other industrial and consumer products by taking advantage of technology advances developed in-house. The Company’s current activities are directed toward research, development, production and marketing of its proprietary technologies relating to the treatment and separation of nanotubes from halloysite clay and the development of related commercial applications for cosmetics, health and beauty products and polymers, plastics and composites. | |||
ViralProtec | |||
In the fourth quarter of 2014, the Company announced the new business line, ViralProtec, (www.viralprotec.com) a division of NaturalNano. ViralProtec, is a reseller for healthcare personal protective equipment (PPE) and ancillary supplies. Our mission is to provide personal protective equipment for caregivers for infectious patient care that meet or exceed CDC and WHO guidelines. ViralProtec was created in response of the public concern and publicity surrounding the risk to caregivers and other responders created by the Ebola virus. The Company will maintain inventory on hand for customers to order complete protection kits from a single source instead multiple sources. | |||
Use of Estimates, Policy [Policy Text Block] | Estimates | ||
The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and assumptions that affect the amounts reported and disclosed in the financial statements and the accompanying notes. Actual results could differ materially from these estimates. On an ongoing basis, we evaluate such estimates. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. | |||
Fair Value of Financial Instruments, Policy [Policy Text Block] | Fair Value of Financial Instruments | ||
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Fair Value Measurement Topic of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) establishes a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include: | |||
· | Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. | ||
· | Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument. | ||
· | Level 3 inputs are unobservable inputs based on the Company’s own assumptions used to measure assets and liabilities at fair value. | ||
A financial asset or liability’s classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. The carrying amounts reported in the balance sheet of cash, accounts receivable, prepaids, accounts payable and accrued expenses approximate fair value because of the immediate or short-term maturity of these financial instruments. The fair value of notes payable approximates their carrying value as the terms of this debt reflects market conditions. The Company’s derivative liability was determined utilizing Level 3 inputs. | |||
Derivatives, Policy [Policy Text Block] | Derivative Financial Instruments | ||
The Company does not use derivative instruments to hedge exposures to cash flow, market or foreign currency risks. The Company evaluates all of its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and then is revalued at each reporting date, with changes in fair value reported in the consolidated statement of operations. For stock based derivative financial instruments, the Company estimated the total enterprise value based upon trending the firm value from December 2006 to March 2015 considering company specific factors including the changes in forward estimated revenues and market factors, market multiples for comparable companies, and the Company’s market share price, all equally weighted. Once the enterprise value was determined an option pricing model was used to allocate the enterprise value to the individual derivative securities in the Company’s capital structure. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or equity, is evaluated at the end of each reporting period. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within twelve months of the balance sheet date. | |||
Reclassification, Policy [Policy Text Block] | Reclassifications | ||
Certain prior year amounts have been reclassified to conform to the current year presentation. | |||
Income Tax, Policy [Policy Text Block] | Income Taxes | ||
The Company accounts for income taxes in accordance with FASB ASC 740 which requires recognition of estimated income taxes payable or refundable on income tax returns for the current year and for the estimated future tax effect attributable to temporary differences and carry-forwards. Measurement of deferred income items is based on enacted tax laws including tax rates, with the measurement of deferred income tax assets being reduced by available tax benefits not expected to be realized. The Company recognizes penalties and accrued interest related to unrecognized tax benefits in income tax expense. Income tax expense was $0 for the three month periods ending March 31, 2015 and 2014. | |||
Earnings Per Share, Policy [Policy Text Block] | Loss Per Share | ||
Loss per common share is computed by dividing net income or loss by the weighted-average number of shares of common stock outstanding during the period. Diluted income or loss per common share gives effect to dilutive convertible preferred stock, convertible debt, options and warrants outstanding during the period. Shares to be issued upon the exercise of these instruments have not been included in the computation of diluted loss per share as their effect is anti-dilutive based on the net loss incurred. | |||
As of March 31, 2015 and 2014 there were 9,130,044 and 6,720,340 shares, respectively, underlying preferred stock, convertible debt, outstanding options and warrants that could potentially dilute future earnings. In addition to these potentially dilutive shares as of March 31, 2015 were an additional 6,666,667 reserved shares underlying the July 23, 2014 Exchange and Right to Shares Agreement with Cape One Master Fund II LLP further described in Note 2 below. | |||
These potentially dilutive shares have been limited by certain debt and equity agreements with lenders. These agreements provide limitations on the conversion of the dilutive instruments such that the number of shares of Common Stock that may be acquired by the holder upon conversion of such instruments shall be limited to ensure that following such conversion the total number of shares of Common Stock then beneficially owned by the holder does not exceed 4.99% of the total number of issued and outstanding shares of Common Stock. The Company does not have sufficient authorized shares to satisfy conversion of all the potentially dilutive instruments. | |||
New Accounting Pronouncements, Policy [Policy Text Block] | Recent Accounting Pronouncements | ||
FASB ASU 2015-3, Interest—Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs ASU 2015-3 is effective for the annual period ending after December 15, 2015. Early adoption is permitted provided that the guidance is applied from the beginning of the fiscal year of adoption. | |||
FASB ASU 2015-1, Income Statement—Extraordinary and Unusual Items (Subtopic 225-20): Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items This ASU eliminates from GAAP the concept of extraordinary items. ASU 2015-1 is effective for the annual period ending after December 15, 2015. Early adoption is permitted provided that the guidance is applied from the beginning of the fiscal year of adoption. | |||
FASB ASU 2014-12, Compensation—Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (a consensus of the FASB Emerging Issues Task Force). ASU 2014-12 requires a performance target that affects vesting and that could be achieved after the requisite service period to be treated as a performance condition. To account for such awards, a reporting entity should apply existing guidance in FASB Accounting Standards Codification Topic 718, Compensation – Stock Compensation, as it relates to awards with performance conditions that affect vesting. ASU 2014-12 is effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. | |||
NOTES_PAYABLE_Tables
NOTES PAYABLE (Tables) | 3 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Debt Disclosure [Abstract] | ||||||||
Schedule of Debt [Table Text Block] | Notes payable consisted of the following: | |||||||
Notes Payable | March 31, | December 31, | ||||||
2015 | 2014 | |||||||
Senior Secured Convertible Notes | $ | 441,988 | $ | 441,988 | ||||
Senior Secured Promissory Notes | 398,938 | 398,938 | ||||||
2014-2015 Convertible Promissory Notes | 755,015 | 694,020 | ||||||
$ | 1,595,941 | $ | 1,534,946 | |||||
SEGMENT_INFORMATION_Tables
SEGMENT INFORMATION (Tables) | 3 Months Ended | |||||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||||||
Schedule of Segment Reporting Information, by Segment [Table Text Block] | Approximate information concerning the Company’s operations by reportable segment for the three months ended March 31, 2015 and March 31, 2014 is as follows: | |||||||||||||||||||
Nanotechnology | ViralProtec | Consolidated | ||||||||||||||||||
For the three months ended | For the three months ended | For the three months ended | ||||||||||||||||||
March 31, | March 31, | March 31, | March 31, | March 31, | March 31, | |||||||||||||||
2015 | 2014 | 2015 | 2014 | 2015 | 2014 | |||||||||||||||
Revenue | $ | 67,827 | $ | 3,640 | $ | 47,258 | - | $ | 115,085 | $ | 3,640 | |||||||||
Loss from operations | $ | -180,260 | $ | -101,725 | $ | 13,221 | - | $ | -167,039 | $ | -101,725 | |||||||||
Interest expense | -65,095 | -95,547 | - | - | -65,095 | -95,547 | ||||||||||||||
Net gain (loss) on derivative liabilities | 146,277 | -26,308 | - | - | 146,277 | -26,308 | ||||||||||||||
Gain (loss) on forgiveness /modification of debt | 7,900 | -40,000 | - | - | 7,900 | -40,000 | ||||||||||||||
Income (loss) | $ | -91,178 | $ | -263,580 | $ | 13,221 | - | $ | -77,957 | $ | -263,580 | |||||||||
Assets | $ | 40,738 | $ | 309,940 | $ | 184,698 | - | $ | 225,436 | $ | 309,940 | |||||||||
DERIVATIVE_LIABILITY_Tables
DERIVATIVE LIABILITY (Tables) | 3 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||
Schedule of Derivative Liabilities at Fair Value [Table Text Block] | The fair value of the derivative liabilities as of March 31, 2015 and December 31, 2014 are as follows: | |||||||
March 31, | December 31, | |||||||
2015 | 2014 | |||||||
Note conversion feature liabilities | $ | 236,690 | $ | 375,949 | ||||
Warrant liability | 4,754 | 11,772 | ||||||
Total | $ | 241,444 | $ | 387,721 | ||||
STOCKHOLDERS_EQUITY_Tables
STOCKHOLDERS EQUITY (Tables) | 3 Months Ended | ||||||||||
Mar. 31, 2015 | |||||||||||
Stockholders' Equity Note [Abstract] | |||||||||||
Class Of Warrant Outstanding [Table Text Block] | A summary of the outstanding warrants is presented below: | ||||||||||
2015 | |||||||||||
Shares | Weighted | Weighted | |||||||||
Average | Average | ||||||||||
Exercise | Remaining | ||||||||||
Price | Life-years | ||||||||||
Outstanding at January 1, 2015 | 545,294 | $ | 4.26 | 2.24 | |||||||
Granted | 300,000 | 0.1 | |||||||||
Warrants outstanding at March 31, 2015 | 845,294 | $ | 0.77 | 4.75 | |||||||
Warrants exercisable at March 31, 2015 | 845,294 | $ | 0.77 | 4.75 | |||||||
INCENTIVE_STOCK_PLANS_Tables
INCENTIVE STOCK PLANS (Tables) | 3 Months Ended | ||||||||||
Mar. 31, 2015 | |||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||
Schedule of Share-based Compensation, Stock Options, Activity [Table Text Block] | A summary of the status of the outstanding incentive stock plans is presented below: | ||||||||||
Shares | Weighted | Weighted Average | |||||||||
Average | Remaining | ||||||||||
Exercise Price | Life-years | ||||||||||
Options outstanding at January 1, 2015 | 2,363 | $ | 921 | 3.53 | |||||||
Options expired unexercised | 907 | ||||||||||
Options outstanding at March 31, 2015 | 1,456 | $ | 1,578.00 | 1.44 | |||||||
Options exercisable at March 31, 2015 | 1,456 | $ | 1,578.00 | ||||||||
PRINCIPAL_BUSINESS_ACTIVITY_AN2
PRINCIPAL BUSINESS ACTIVITY AND SIGNIFICANT ACCOUNTING POLICIES (Details Textual) (USD $) | 3 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | |
Accounting Policies [Line Items] | |||
Net loss attributable to controlling interest | ($77,957) | ($263,580) | |
Working Capital Deficit | 3,620,000 | ||
Total stockholders' deficiency | -3,964,575 | -4,164,079 | |
Stock Conversion Limit Percentage | 4.99% | ||
Income Tax Expense (Benefit) | $0 | $0 | |
Options And Securities [Member] | |||
Accounting Policies [Line Items] | |||
Weighted Average Number Diluted Shares Outstanding Adjustment | 9,130,044 | 6,720,340 | |
Cape One Master Fund II LLP [Member] | |||
Accounting Policies [Line Items] | |||
Incremental Common Shares Attributable to Dilutive Effect of Contingently Issuable Shares | 6,666,667 |
NOTES_PAYABLE_Details
NOTES PAYABLE (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
Notes Payable [Line Items] | ||
Notes payable, Total | $1,595,941 | $1,534,946 |
Senior Secured Convertible Notes [Member] | ||
Notes Payable [Line Items] | ||
Notes payable, Total | 441,988 | 441,988 |
Senior Secured Promissory Notes [Member] | ||
Notes Payable [Line Items] | ||
Notes payable, Total | 398,938 | 398,938 |
2014-2015 Convertible Promissory Notes [Member] | ||
Notes Payable [Line Items] | ||
Notes payable, Total | $755,015 | $694,020 |
NOTES_PAYABLE_Details_Textual
NOTES PAYABLE (Details Textual) (USD $) | 3 Months Ended | 1 Months Ended | 3 Months Ended | |
Mar. 31, 2015 | Jul. 23, 2014 | Mar. 31, 2014 | Dec. 31, 2014 | |
Notes Payable [Line Items] | ||||
Notes Payable, Total | $1,595,941 | $1,534,946 | ||
Rights Not Settleable in Cash Fair Value Disclosure | 343,350 | 559,289 | ||
Adjustments to Additional Paid in Capital, Fair Value | 215,939 | |||
Cape One Master Fund II LLP [Member] | ||||
Notes Payable [Line Items] | ||||
Incremental Common Shares Attributable to Dilutive Effect of Contingently Issuable Shares | 6,666,667 | 6,666,667 | ||
Additional Paid-in Capital [Member] | ||||
Notes Payable [Line Items] | ||||
Adjustments to Additional Paid in Capital, Fair Value | 215,939 | |||
Cape One [Member] | ||||
Notes Payable [Line Items] | ||||
Debt Instrument For Bearance Increased Amount | 40,000 | |||
Senior Secured Convertible Promissory Notes [Member] | ||||
Notes Payable [Line Items] | ||||
Notes Payable, Total | 840,926 | 840,926 | ||
Debt Instrument, Convertible, Threshold Percentage of Stock Price Trigger | 75.00% | |||
Senior Secured Convertible Promissory Notes [Member] | Scenario, Forecast [Member] | ||||
Notes Payable [Line Items] | ||||
Debt Instrument For Bearance Interest Rate Percentage | 18.00% | |||
Senior Convertible Promissory Notes 2014 [Member] | ||||
Notes Payable [Line Items] | ||||
Stock Issued During Period, Value, New Issues | 61,000 | |||
Senior Convertible Promissory Notes 2014 [Member] | Scenario, Forecast [Member] | ||||
Notes Payable [Line Items] | ||||
Debt Instrument For Bearance Interest Rate Percentage | 18.00% | |||
Subordinated Secured Convertible Notes [Member] | ||||
Notes Payable [Line Items] | ||||
Loss On Modification Notes Payable | 40,000 | |||
Subordinated Secured Convertible Notes [Member] | Cape One Master Fund II LLP [Member] | ||||
Notes Payable [Line Items] | ||||
Notes Payable, Total | 379,624 | |||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 4.99% | |||
Proceeds Receivable From Sale Of Shares Obtained | 3,500,000 | |||
Rights Not Settleable in Cash Fair Value Disclosure | $343,350 | |||
Incremental Common Shares Attributable to Dilutive Effect of Contingently Issuable Shares | 6,666,667 | |||
Sale of Shares Obtained Description | Upon expiration of the Lockup period, Cape One shall be allowed to sell the lesser of (i) 5% of the daily trading volume of the Companys common stock or, (ii) 10% of the reserved shares in any calendar month. |
SEGMENT_INFORMATION_Details
SEGMENT INFORMATION (Details) (USD $) | 3 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | |
Segment Reporting Information [Line Items] | |||
Revenue | $115,085 | $3,640 | |
Loss from operations | -167,039 | -101,725 | |
Interest expense | 65,095 | 95,547 | |
Net gain (loss) on derivative liabilities | 146,277 | -26,308 | |
Gain (loss) on forgiveness /modification of debt | 7,900 | -40,000 | |
Income (loss) | -77,957 | -263,580 | |
Assets | 225,436 | 309,940 | 309,940 |
Nanotechnology Segment [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenue | 67,827 | 3,640 | |
Loss from operations | -180,260 | -101,725 | |
Interest expense | -65,095 | -95,547 | |
Net gain (loss) on derivative liabilities | 146,277 | -26,308 | |
Gain (loss) on forgiveness /modification of debt | 7,900 | -40,000 | |
Income (loss) | -91,178 | -263,580 | |
Assets | 40,738 | 309,940 | |
Viralprotec Segment [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenue | 47,258 | 0 | |
Loss from operations | 13,221 | 0 | |
Interest expense | 0 | 0 | |
Net gain (loss) on derivative liabilities | 0 | 0 | |
Gain (loss) on forgiveness /modification of debt | 0 | 0 | |
Income (loss) | 13,221 | 0 | |
Assets | $184,698 | $0 |
SEGMENT_INFORMATION_Details_Te
SEGMENT INFORMATION (Details Textual) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Segment Reporting Information [Line Items] | ||
Revenue, Net, Total | $115,085 | $3,640 |
UNITED STATES | ||
Segment Reporting Information [Line Items] | ||
Revenue, Net, Total | 9,600 | |
Nanotechnology Segment [Member] | ||
Segment Reporting Information [Line Items] | ||
Concentration Risk, Percentage | 100.00% | |
Revenue, Net, Total | 67,827 | 3,640 |
Nanotechnology Segment [Member] | Sales Revenue, Net [Member] | ||
Segment Reporting Information [Line Items] | ||
Concentration Risk, Percentage | 58.00% | |
Viralprotec Segment [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenue, Net, Total | $47,258 | $0 |
Viralprotec Segment [Member] | Sales Revenue, Net [Member] | ||
Segment Reporting Information [Line Items] | ||
Concentration Risk, Percentage | 15.00% |
DERIVATIVE_LIABILITY_Details
DERIVATIVE LIABILITY (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
Derivative [Line Items] | ||
Note conversion feature liabilities | $236,690 | $375,949 |
Derivative Liability, Fair Value, Net | 241,444 | 387,721 |
Warrant liability [Member] | ||
Derivative [Line Items] | ||
Derivative Liability, Fair Value, Net | $4,754 | $11,772 |
DERIVATIVE_LIABILITY_Details_T
DERIVATIVE LIABILITY (Details Textual) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Derivative [Line Items] | ||
Derivative, Gain (Loss) on Derivative, Net, Total | $146,277 | ($26,308) |
STOCKHOLDERS_EQUITY_Details
STOCKHOLDERS EQUITY (Details) (Warrant [Member], USD $) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2015 | Dec. 31, 2014 | |
Warrant [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares, Outstanding at beginning of year | 545,294 | |
Shares, Granted during the year | 300,000 | |
Shares, Outstanding at end of year | 845,294 | 545,294 |
Shares, Exercisable at end of year | 845,294 | |
Weighted Average Exercise Price, Outstanding at beginning of year | $4.26 | |
Weighted Average Excercise Price, Granted | $0.10 | |
Weighted Average Exercise Price, Outstanding at end of year | $0.77 | $4.26 |
Weighted Average Exercise Price, Exercisable at end of year | $0.77 | |
Weighted Average Remaining Life-years, Outstanding (in years) | 4 years 9 months | 2 years 2 months 26 days |
Weighted Average Remaining Life years, Exercisable at end of year (in years) | 4 years 9 months |
STOCKHOLDERS_EQUITY_Details_Te
STOCKHOLDERS EQUITY (Details Textual) (USD $) | 1 Months Ended | 3 Months Ended | ||
Jul. 23, 2014 | Mar. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Schedule of Equity Method Investments [Line Items] | ||||
Common Stock, shares authorized | 800,000,000 | 800,000,000 | 800,000,000 | |
Preferred Stock, shares authorized | 10,000,000 | |||
Potential Equity Shares Outstanding | 9,130,044 | |||
Class of Warrant or Right, Outstanding | 845,294 | 545,294 | ||
Cape One Master Fund II LLP [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Incremental Common Shares Attributable to Dilutive Effect of Contingently Issuable Shares | 6,666,667 | 6,666,667 | ||
Series B and Series C Convertible Preferred Stock [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Stock Issued During Period, Shares, Conversion of Units | 160 | |||
Excess Of Debt Instrument Conversion Percentage | 4.99% | |||
Platinum Partners Long Term Growth Iv and Longview Special Financing Inc [Member] | Series C Preferred Stock [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Stock Issued During Period, Shares, Conversion of Units | 160 | |||
Management [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Granted | 300,000 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value | 61,106 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate | 140.00% | |||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate, Minimum | 1.62% | |||
Share Price | 0.22 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Exercise Price | 0.1 |
INCENTIVE_STOCK_PLANS_Details
INCENTIVE STOCK PLANS (Details) (Incentive Stock Plans [Member], USD $) | 3 Months Ended |
Mar. 31, 2015 | |
Incentive Stock Plans [Member] | |
Stock Option Plan [Line Items] | |
Shares, Outstanding at beginning of year | 2,363 |
Options expired unexercised | 907 |
Shares, Outstanding at end of year | 1,456 |
Shares, Exercisable at end of year | 1,456 |
Weighted Average Exercise Price, Outstanding at beginning of year | $921 |
Weighted Average Exercise Price, Outstanding at end of year | $1,578 |
Weighted Average Exercise Price, Exercisable at end of year | $1,578 |
Weighted Average Remaining Life-years, Outstanding (in years) | 3 years 6 months 11 days |
Weighted Average Remaining Life years, Exercisable at end of year (in years) | 1 year 5 months 8 days |
INCENTIVE_STOCK_PLANS_Details_
INCENTIVE STOCK PLANS (Details Textual) (USD $) | Mar. 31, 2015 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Intrinsic Value | $0 |
REVERSE_STOCK_SPLIT_Details_Te
REVERSE STOCK SPLIT (Details Textual) | 3 Months Ended |
Mar. 31, 2015 | |
Stockholders' Equity, Reverse Stock Split | 1-for-300 reverse stock split of its common stock |