Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | May 13, 2020 | |
Document And Entity Information | ||
Entity Registrant Name | APPLIED ENERGETICS, INC. | |
Entity Central Index Key | 0000879911 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2020 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2020 | |
Entity Reporting Status Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 213,127,395 | |
Entity File Number | 001-14015 | |
Entity Interactive Data Current | Yes | |
Entity Incorporation, State Country Code | DE |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Current assets | ||
Cash and cash equivalents | $ 296,133 | $ 88,415 |
Other receivable | 2,880 | 2,880 |
Other assets | 197,980 | 52,686 |
Total current assets | 496,993 | 143,981 |
Long-term assets | ||
Long-term receivable | 582,377 | 582,377 |
Property and equipment - net | 32,292 | 36,568 |
Deferred compensation | 1,875,000 | 2,083,334 |
Total long-term assets | 2,489,669 | 2,702,279 |
TOTAL ASSETS | 2,986,662 | 2,846,260 |
Current liabilities | ||
Accounts payable | 298,522 | 472,868 |
Accrued officer compensation | 206,000 | 206,000 |
Notes payable including accrued interest of $176,423 at March 31, 2020 and $119,218 at December 31, 2019 | 3,513,591 | 3,467,890 |
Due to related parties | 50,000 | 50,000 |
Accrued expenses | 3,020 | 23,587 |
Accrued dividends | 48,079 | 48,079 |
Total current liabilities | 4,119,212 | 4,268,424 |
Long-term liabilities | ||
Long-term notes payable | 1,500,000 | 1,500,000 |
Total liabilities | 5,619,212 | 5,768,424 |
Commitments and contingencies | ||
Stockholders' (deficit) | ||
Series A Convertible Preferred Stock, $.001 par value, 2,000,000 shares authorized; 13,602 shares issued and outstanding at March 31, 2020 and at December 31, 2019 | 14 | 14 |
Common stock, $.001 par value, 500,000,000 shares authorized; 210,304,062 and 206,569,062 shares issued and outstanding at March 31, 2020 and at December 31, 2019, respectively | 210,304 | 206,569 |
Additional paid-in capital | 87,458,494 | 85,907,523 |
Accumulated deficit | (90,301,362) | (89,036,270) |
Total stockholders' (deficit) | (2,632,550) | (2,922,164) |
TOTAL LIABILITIES AND STOCKHOLDERS' (DEFICIT) | $ 2,986,662 | $ 2,846,260 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Series A convertible preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Series A convertible preferred stock, shares authorized | 2,000,000 | 2,000,000 |
Series A convertible preferred stock, shares issued | 13,602 | 13,602 |
Series A convertible preferred stock, shares outstanding | 13,602 | 13,602 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 210,304,062 | 206,569,062 |
Common stock, shares outstanding | 210,304,062 | 206,569,062 |
Notes payable including accrued interest | $ 176,423 | $ 119,218 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Statement [Abstract] | ||
Revenue | $ 10,000 | |
Cost of revenue | ||
Gross profit | 10,000 | |
Operating expenses | ||
General and administrative | 1,090,418 | 456,719 |
Selling and marketing | 81,686 | 52,335 |
Research and development | 57,480 | 72,661 |
Total operating expenses | 1,229,584 | 581,715 |
Operating loss | (1,219,584) | (581,715) |
Other income (expense) | ||
Other income | 15,832 | |
Interest (expense) | (61,339) | (4,440) |
Total other (expense) | (45,507) | (4,440) |
Net loss | (1,265,091) | (586,155) |
Preferred stock dividends | (8,501) | (8,501) |
Net loss attributable to common stockholders | $ (1,273,592) | $ (594,656) |
Net loss per common share - basic and diluted | $ (0.01) | $ (0.01) |
Weighted average number of shares outstanding, basic and diluted | 208,973,729 | 203,814,063 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders' Equity Deficit (Unaudited) - USD ($) | Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Total |
Balance at Dec. 31, 2018 | $ 14 | $ 201,697 | $ 82,637,749 | $ (83,479,931) | $ (640,471) |
Balance (in shares) at Dec. 31, 2018 | 13,602 | 201,697,396 | |||
Stock-based compensation | 122,950 | 122,950 | |||
Stock-based compensation, Shares | |||||
Sale of common stock | $ 2,500 | 147,500 | 150,000 | ||
Sale of common stock, Shares | 2,500,000 | ||||
Net loss | (586,155) | (586,155) | |||
Balance at Mar. 31, 2019 | $ 14 | $ 204,197 | 82,908,199 | (84,066,086) | (953,676) |
Balance (in shares) at Mar. 31, 2019 | 13,602 | 204,197,396 | |||
Balance at Dec. 31, 2019 | $ 14 | $ 206,569 | 85,907,523 | (89,036,271) | (2,922,164) |
Balance (in shares) at Dec. 31, 2019 | 13,602 | 206,569,062 | |||
Stock-based compensation | 439,956 | 439,956 | |||
Stock-based compensation, Shares | |||||
Common stock issued on exercise of warrant | $ 25 | 1,725 | 1,750 | ||
Common stock issued on exercise of warrant, Shares | 25,000 | ||||
Sale of common stock | $ 3,710 | 1,109,290 | 1,113,000 | ||
Sale of common stock, Shares | 3,710,000 | ||||
Net loss | (1,265,091) | (1,265,091) | |||
Balance at Mar. 31, 2020 | $ 14 | $ 210,304 | $ 87,458,494 | $ (90,301,362) | $ (2,632,550) |
Balance (in shares) at Mar. 31, 2020 | 13,602 | 210,304,062 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (1,265,091) | $ (586,155) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Noncash stock based compensation expense | 439,956 | 122,950 |
Amortization of future compensation payable | 208,333 | |
Depreciation and amortization | 4,276 | 3,241 |
Amortization of prepaid expenses | 39,303 | 11,539 |
Interest expense | 4,440 | |
Changes in assets and liabilities: | ||
Accounts receivable | 9,888 | |
Other receivable | 60,000 | |
Prepaids and deposits | (86,420) | (47,891) |
Long term receivables - net | (141,182) | |
Accounts payable | (177,989) | (128,878) |
Accrued interest | 60,848 | |
Accrued expenses and compensation | (20,567) | 54,212 |
Net cash used in operating activities | (787,463) | (647,724) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Net cash used in investing activities | ||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from notes payable | 400,000 | |
Proceeds from issuance of common stock | 1,113,000 | 150,000 |
Repayment on notes payable | (119,569) | |
Proceeds from the exercise of stock options and warrants | 1,750 | |
Net cash provided by financing activities | 995,181 | 550,000 |
Net increase (decrease) in cash and cash equivalents | 207,718 | (97,724) |
Cash and cash equivalents, beginning of period | 88,415 | 178,552 |
Cash and cash equivalents, end of period | 296,133 | 80,828 |
Supplemental Cash Flow Information | ||
Cash paid for interest | 5,243 | 523 |
Cash paid for taxes |
Basis of Presentation and Going
Basis of Presentation and Going Concern | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF PRESENTATION AND GOING CONCERN | 1. BASIS OF PRESENTATION AND GOING CONCERN The accompanying interim unaudited condensed consolidated financial statements include the accounts of Applied Energetics, Inc. and its wholly owned subsidiary North Star Power Engineering, Inc. as of March 31, 2020 (collectively, "company," "Applied Energetics," "we," "our" or "us"). All intercompany balances and transactions have been eliminated. In the opinion of management, all adjustments (which include normal recurring adjustments) necessary for a fair presentation of the results for the interim periods presented have been made. The results for the three-month period ended March 31, 2020, may not be indicative of the results for the entire year. The interim unaudited condensed consolidated financial statements should be read in conjunction with the company's audited consolidated financial statements contained in our Annual Report on Form 10-K. The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. For the three months ended March 31, 2020, the company incurred a net loss of approximately $1,265,000, had negative cash flows from operations of $787,000 and may incur additional future losses due to the reduction in Government contract activity. Additionally, as of March 31, 2020, the company had a working capital (current assets less current liabilities) deficit of $3,622,000. These matters raise substantial doubt as to the company's ability to continue as a going concern. The ongoing COVID-19 pandemic contributes to this uncertainty. The company's existence is dependent upon management's ability to develop profitable operations. Management is devoting substantially all of its efforts to developing its business and raising capital and there can be no assurance that the company's efforts will be successful. No assurance can be given that management's actions will result in profitable operations or the resolution of its liquidity problems. The accompanying consolidated financial statements do not include any adjustments that might result should the company be unable to continue as a going concern for one year from the date the financials are issued. In order to improve the company's liquidity, the company's management is actively pursuing additional equity financing through discussions with investment bankers and private investors. There can be no assurance that the company will be successful in its effort to secure additional equity financing. The financial statements do not include any adjustments relating to the recoverability of assets and the amount or classification of liabilities that might be necessary should the company be unable to continue as a going concern. LIQUIDITY AND MANAGEMENT'S PLAN The accompanying unaudited financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. For the three months ended March 31, 2020, the company incurred a net loss of approximately $1,265,000, had negative cash flows from operations of approximately $787,000 and conducted financing activities yielding $1,113,000 in proceeds from the issuance of common stock, partially offset by payments on notes payable of $120,000 and expects to incur additional future losses due to the reactivation of its business activities. These matters raise substantial doubt as to the company's ability to continue as a going concern unless the company is able to obtain additional financing for its continuing operations. The financial statements do not include any adjustments relating to the recoverability of assets and the amount or classification of liabilities that might be necessary should the company be unable to continue as a going concern. As of March 31, 2020, the company had approximately $296,000 in cash and cash equivalents. USE OF ESTIMATES The preparation of consolidated financial statements in conformity with United States Generally Accepted Accounting Principles ("GAAP") requires management to make estimates, judgments and assumptions that affect the amounts reported in the financial statements and accompanying notes. Management bases its assumptions on historical experiences and on various other estimates that it believes 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. In addition, management considers the basis and methodology used in developing and selecting these estimates, the trends in and amounts of these estimates, specific matters affecting the amount of and changes in these estimates, and any other relevant matters related to these estimates, including significant issues concerning accounting principles and financial statement presentation. Such estimates and assumptions could change in the future, as more information becomes known which could materially impact the amounts reported and disclosed herein. Significant estimates include measurements of income tax assets and liabilities. Multiple contract proposals were submitted to various government agencies in 2019 and 2020. Due to the COVID-19 related closures of multiple agencies and work-from-home orders across various regions of the United States, we anticipate that reviews and funding decisions on these proposals might be delayed longer than anticipated as resources are focused on other matters within the government. REVENUE RECOGNITION A majority of revenue under long-term government contracts is recorded under the percentage of completion method. Revenue, billable monthly under cost plus fixed fee contracts, is recorded as costs are incurred and includes estimated earned fees in the proportion that costs incurred to date bear to total estimated costs. Costs include direct labor, direct materials, subcontractor costs and manufacturing and administrative overhead allowable under the contract. General and administrative expenses allowable under the terms of contracts are allocated per contract, depending on its direct labor and material proportion to total direct labor and material of all contracts. As contracts can extend over one or more accounting periods, revisions in earnings estimated during the course of work are reflected during the accounting period in which the facts become known. When the current contract estimate indicates a loss, a provision is made for the total anticipated loss in the current period. We do not generally provide an allowance for returns from our government customers because our customer agreements do not provide for a right of return. The asset caption "accounts receivable" includes costs and estimated earnings in excess of billings on uncompleted contracts, which represents revenue recognized in excess of amounts billed. Such revenue is billable under the terms of contracts at the end of the year, but was not invoiced until the following year and is generally expected to be collected within one year. Revenue for other products and services is recognized when such products and services are delivered or performed and, in connection with certain sales to Government agencies, when the products and services are accepted, which is normally negotiated as part of the initial contract. Revenue from commercial, non-Governmental, customers is based on fixed price contracts where the sale is recognized upon acceptance of the product or performance of the service and when payment is probable. Contract costs are deferred in the same manner as inventory costs and are charged to operations as the related revenue from contracts is recognized. When a current contract estimate indicates a loss, a provision is made for the total anticipated loss in the period in which such facts become evident. RECENT ACCOUNTING PRONOUNCEMENTS The company has reviewed issued accounting pronouncements and plans to adopt those that are applicable to it. The company does not expect the adoption of any other pronouncements to have an impact on its results of operations or financial position. |
Share-Based Compensation
Share-Based Compensation | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
SHARE-BASED COMPENSATION | 2. SHARE-BASED COMPENSATION Share-Based Compensation For the three months ended March 31, 2020 and 2019, share-based compensation expense totaled approximately $440,000 and $123,000, respectively. We determine the fair value of option grant share-based awards at their grant date, using a Black-Scholes-Merton Option-Pricing Model applying the assumptions in the following table: three months ended 2020 2019 Expected life (years) N/A N/A Dividend yield N/A N/A Expected volatility N/A N/A Risk free interest rates N/A N/A Weighted average fair value of options at grant date N/A N/A For the three months ended March 31, 2020, no options to purchase stock were granted and no options were forfeited, additionally, no options to purchase stock were exercised or expired and no restricted stock awards were granted; no restricted stock units were granted, vested or forfeited. At March 31, 2020, options to purchase 31,400,000 shares of common stock were outstanding with a weighted average exercise price of $0.143, a weighted average remaining contract term of approximately 6.4 years with an aggregate intrinsic value of $3,811,000. At March 31, 2020 options for 21,688,000 shares were exercisable. As of March 31, 2020, there was approximately $1,436,000 of unrecognized compensation cost related to unvested stock options granted and outstanding, net of estimated forfeitures. The cost is expected to be recognized on a weighted average basis over a period of approximately two years. |
Net Loss Per Share
Net Loss Per Share | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
NET LOSS PER SHARE | 3. NET LOSS PER SHARE Basic net loss per common share is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding during the period before giving effect to stock options, stock warrants, restricted stock units and convertible securities outstanding, which are considered to be dilutive common stock equivalents. Diluted net loss per common share is calculated based on the weighted average number of common and potentially dilutive shares outstanding during the period after giving effect to convertible preferred stock, stock options, warrants and restricted stock units. Contingently issuable shares are included in the computation of basic loss per share when issuance of the shares is no longer contingent. Due to the losses from continuing operations for the three months ended March 31, 2020 and 2019, basic and diluted loss per common share were the same, as the effect of potentially dilutive securities would have been anti-dilutive. Potentially dilutive securities not included in the diluted loss per share calculation, due to net losses from continuing operations, were as follows: three months ended 2020 2019 Options to purchase common shares 31,400,000 27,750,000 Warrants to purchase common shares 3,650,000 200,000 Convertible preferred stock 47,466 44,632 Total potentially dilutive securities 35,097,466 27,994,632 |
Dividends
Dividends | 3 Months Ended |
Mar. 31, 2020 | |
Dividends [Abstract] | |
DIVIDENDS | 4. DIVIDENDS Dividends on Preferred Stock are accrued when the amount and kind of dividend is determined and are payable quarterly on the first day of February, May, August and November, in cash or shares of common stock. The holders of shares of Series A Convertible Preferred Stock are entitled to receive dividends at the initial rate of 6.5% of the liquidation preference per share (the "Initial Dividend Rate"), payable, at the option of the corporation, in (i) cash, (ii) shares of our common stock (valued for such purpose at 95% of the weighted average of the last sales prices of our common stock for each of the trading days in the ten trading day period ending on the third trading day prior to the applicable dividend payment date) provided that the issuance and/or resale of all such shares of our common stock are then covered by an effective registration statement or (iii) any combination of the foregoing. If the company fails to pay dividends in the five business days following a dividend payment date (a "Payment Default"), the dividend rate shall immediately and automatically increase to 7.5% of the liquidation preference per share for as long as such Payment Default continues (or return to the Initial Dividend Rate at such time as such Payment Default no longer continues), and if a Payment Default shall occur on two consecutive Dividend Payment Dates, the dividend rate shall immediately and automatically increase to 10% of the Liquidation Preference for as long as such Payment Default continues and shall immediately and automatically return to the Initial Dividend Rate at such time as the Payment Default is no longer continuing. As of March 31, 2020, we had 13,602 shares of our 6.5% Series A Convertible Preferred Stock outstanding. The company has not paid the dividends commencing with the quarterly dividend due August 1, 2013. Dividend arrearages as of March 31, 2020 was approximately $230,000. Our Board of Directors suspended the declaration of the dividend, commencing with the dividend payable as of February 1, 2015 since we did not have a surplus (as such term is defined in the Delaware General Corporation Law) as of December 31, 2014, until such time as we have a surplus or net profits for a fiscal year. Our Series A Preferred Stock has a liquidation preference of $25.00 per Share. |
Other Assets
Other Assets | 3 Months Ended |
Mar. 31, 2020 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
OTHER ASSETS | 5. OTHER ASSETS Other assets primarily represents prepaid assets for insurance premiums and deposits with attorneys. |
Long Term Receivable
Long Term Receivable | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
LONG TERM RECEIVABLE | 6. LONG TERM RECEIVABLE In our litigation, the company was required to place a bond with a surety. The company does not have access to these funds and it is out of our control to use them (refer note 11). |
Deferred Compensation
Deferred Compensation | 3 Months Ended |
Mar. 31, 2020 | |
Retirement Benefits [Abstract] | |
Deferred Compensation | 7. DEFERRED COMPENSATION Deferred compensation represents the remaining amortization of the note payable issued in the acquisition of Applied Optical Sciences. |
Notes Payable
Notes Payable | 3 Months Ended |
Mar. 31, 2020 | |
Notes Payable [Abstract] | |
NOTES PAYABLE | 8. NOTES PAYABLE During the three months ended March 31, 2020, the company entered into a premium financing agreement to finance its director and officer insurance policy. The principal is approximately $108,000, with nine monthly payments of $12,498 and an interest rate of 9.7% the balance at March 31, 2020 is $96,000 included in current notes payable. During the three months ended March 31, 2019, the company received $400,000 from three non-affiliated individuals based on 10% Promissory Notes ("Notes"). The Notes matured September 1, 2019. The Notes are accompanied by a Common Stock Purchase Warrant (a "Warrant") entitling the holder to purchase one share of the company's common stock, par value $0.001 per share (the "Common Shares"), for each $2.00 of Note principal, at an exercise price of $0.07 per share, for two years from the date of issuance. The company issued 200,000 warrants along with the notes. The company determine the fair value of warrant grant at their grant date, using a Black-Scholes-Merton Option-Pricing Model. The balance of these notes is $444,000 at March 31, 2020 and $434,000 at December 31, 2019. Interest expense on these notes was $10,000 for the quarter ended March 31, 2020 and $4,000 for the quarter ended March 31, 2019. The following reconciles notes payable as of March 31, 2020 and December 31, 2019: March 31, December 31, Notes payable $ 4,988,065 $ 4,880,000 Accrued interest 176,423 119,218 Payments on notes payable (205,226 ) (85,657 ) Transfer from prepaid 54,329 54,329 - $ 5,013,591 $ 4,967,890 Of the notes payable at March 31, 2020 $1,151,000 were due September 1, 2019 and $1,267,000 were due December 1, 2019, $96,000, payable monthly over eight monthly payments, is due December 12, 2020, and $2,500,000 is payable in $500,000 semi-annual payments starting May 24, 2020 and is due May 24, 2022. The notes due on September 1, 2019 and December 31, 2019 have an interest rate of 10%, the note due on December 12, 2020 has an interest rate of 9.7%, and the note due on May 24, 2022 has interest rate of 0%. All notes are unsecured and not convertible. Interest expense on these notes was $58,000 for the quarter ended March 31, 2020 and $4,000 for the quarter ended March 31, 2019. |
Due to Related Parties
Due to Related Parties | 3 Months Ended |
Mar. 31, 2020 | |
Related Party Transactions [Abstract] | |
DUE TO RELATED PARTIES | 9. DUE TO RELATED PARTIES It came to the board's attention that on July 31, 2018, our now deceased CEO deposited $50,000 into the company's account. Although it has been suggested that the funds may have been intended for use toward Mr. Dearmin's healthcare, the board does not know for certain what the purpose of the funds were or the nature of any intended investment. Accordingly, the board is investigating the appropriate disposition of the funds which will likely be to the estate of Mr. Dearmin. Until such a determination is made, the board does not intend to use these funds for any corporate purpose. For reporting purposes, the company has treated the deposit as a due to related party. |
Stockholders Deficit
Stockholders Deficit | 3 Months Ended |
Mar. 31, 2020 | |
Stockholders' Equity Note [Abstract] | |
STOCKHOLDERS DEFICIT | 10. STOCKHOLDERS DEFICIT On January 13, 2020, the company received $45,000 from an individual based on a subscription agreement with the company for which the company issued 150,000 shares of its common stock. On January 13, 2020, the company received $60,000 from two individuals based on a subscription agreement with the company for which the company issued 200,000 shares of its common stock. On January 15, 2020, the company received $30,000 from two individuals based on a subscription agreement with the company for which the company issued 100,000 shares of its common stock On January 22, 2020, the company received $204,000 from an individual based on a subscription agreement with the company for which the company issued 680,000 shares of its common stock. On January 23, 2020, the company received $204,000 from an individual based on a subscription agreement with the company for which the company issued 680,000 shares of its common stock. On January 24, 2020, the company received $60,000 from an individual based on a subscription agreement with the company for which the company issued 200,000 shares of its common stock. On January 30, 2020, the company received $1,750 from an individual based on the exercise of a warrant for which the company issued 25,000 shares of its common stock. On February 19, 2020, the company received $510,000 from an individual based on a subscription agreement with the company for which the company issued 1,700,000 shares of its common stock. Series A Convertible Preferred Stock, $.001 par value, 2,000,000 shares authorized; 13,602 shares issued and outstanding at March 31, 2020 and at December 31, 2019. The $440,000 stock-based compensation for the quarter ended March 31, 2020 was comprised of $273,000 option expense and $167,000 was the amortization of 5,000,000 shares of stock valued at $0.4014 over three years for the acquisition of Applied Optical Sciences. On April 8, 2020, the company received $10,500 from an individual based on a warrant exercise for which the company issued 150,000 shares of its common stock. On April 8, 2020, the company received $63,000 from an individual based on an option exercise for which the company issued 900,000 shares of its common stock. On April 8, 2020, the company received $60,000 from an individual based on a subscription agreement with the company for which the company issued 200,000 shares of its common stock. On April 23, 2020, the company received $72,000 from an individual based on a subscription agreement with the company for which the company issued 240,000 shares of its common stock. On April 29, 2020, the company received $400,000 from an individual based on a subscription agreement with the company for which the company issued 1,333,333 shares of its common stock. During January 2019, the company received $150,000 from three individuals based on subscription agreements with the company for which the company issued 2,500,000 shares of its common stock. |
Legal Proceedings
Legal Proceedings | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
LEGAL PROCEEDINGS | 11. LEGAL PROCEEDINGS As previously reported, on July 3, 2018, we commenced a lawsuit in the Court of Chancery of the State of Delaware against the company's former director and principal executive officer George Farley and AnneMarieCo LLC ("AMC"). The lawsuit alleges to the following six causes of action: 1. Breach of Fiduciary Duty of Loyalty against George Farley 2. Breach of Fiduciary Duty of Care against George Farley 3. Aiding and Abetting Breach of Fiduciary Duty against AMC 4. Conversion against George Farley 5. Fraudulent Transfer against George Farley and AMC 6. Injunctive Relief against George Farley and AMC This report provides an update on the progress of the litigation. In connection with the lawsuit, the company requested a temporary restraining order prohibiting Mr. Farley and AMC from selling their 25 million shares of the company's common stock which the company alleges were improperly issued. On July 20, 2018, the Delaware Court of Chancery, Vice Chancellor Tamika Montgomery-Reeves presiding, entered a "status quo" order upon the stipulation of the parties, whereby Mr. Farley and AMC agreed not to transfer, alienate or sell any of their shares pending a ruling on the company's motion for a preliminary injunction. On July 26, 2018, the Delaware Court of Chancery entered a scheduling order setting dates and deadlines for, among other matters, a hearing and briefing schedule on the amount of the bond the company would be required to post to maintain the "status quo" order through the preliminary injunction hearing, a hearing and briefing schedule on the motion for a preliminary injunction, and a discovery schedule. Also, in connection with the lawsuit, on August 8, 2018, the company filed a motion to disqualify Mr. Farley's attorney, Ryan Whalen, who had previously represented the company. On August 14, 2018, the Delaware Court of Chancery issued an order requiring the company to post a bond in the total amount of $200,446.52. On August 21, 2018, the company posted the bond via Atlantic Specialty Insurance company acting as surety. Pursuant to the contract between the company and Atlantic Specialty Insurance company, the company deposited $200,446.52 in cash as collateral for the surety agreement. On August 23, 2018, the Delaware Court of Chancery court extended the hearing date on the company's motion for a preliminary injunction to October 23, 2018, and simultaneously ordered an increase in the bond amount of $55,446.52. On August 30, 2018, the company posted the increased bond amount, again with Atlantic Specialty Insurance Company acting as surety, and deposited the additional $55,446.52 in cash with the surety. On September 7, 2018, the Delaware Court of Chancery entered an order setting a briefing schedule on the company's motion to disqualify Mr. Whalen. On September 10, 2018, the Delaware Court of Chancery entered an order governing the production and exchange of confidential documents and information among the parties in discovery. In another Current Report on Form 8-K filed September 13, 2018, the company updated the status of the litigation to include events that occurred up to that date. This report further updates the progress of the litigation. On October 16, 2018, the Delaware Court of Chancery entered a scheduling order continuing the hearing date on the company's motion for a preliminary injunction against defendants George Farley and AMC to December 14, 2018. The October 16, 2018 order also required the company to increase its bond amount by an additional $185,301.86 ($80,301.86 for AMC and $105,000.00 for Mr. Farley) to account for the continued hearing date. On October 24, 2018, the company posted the additional bond amount of $185,301.86. On October 16, 2018, the Delaware Court of Chancery issued an order denying the company's motion to disqualify Mr. Whalen. On January 23, 2019, the Delaware Court of Chancery issued a Memorandum Opinion, granting a preliminary injunction prohibiting Mr. Farley and AMC from selling their 25 million shares of the company's common stock, which the company alleges were improperly issued. On January 24, 2019, the Delaware Court of Chancery issued a revised Memorandum Opinion correcting calculations regarding the increased bond amount. In granting the preliminary injunction, the Court found that the company met "its considerable burden" of demonstrating it was likely to win its lawsuit against Mr. Farley and AMC. Specifically, the Court found it was "reasonably probable" Mr. Farley had unlawfully issued the 25 million shares without proper authorization, Mr. Farley had breached his duty of loyalty to the company, Mr. Farley was unlikely to prove the stock issuance was procedurally or substantively "fair" to the company, and Mr. Farley had fraudulently transferred 20 million of the shares to AMC. Finally, the Court ruled because Farley and AMC's 25 million shares represented approximately one eighth of the company's outstanding ownership, the injunction was necessary to protect the company's capital structure, ability to attract new investors, ability to raise new capital and continue deployment of its plans now underway to revitalize its business. In its Memorandum Opinion, the Court also required that the company post additional bond money, bringing the total cash collateral for the surety agreement to $582,377.26. The company posted the additional bond amount, and deposited the additional cash amount with the surety, on January 29, 2019. On March 4, 2019, the company filed an amended complaint adding claims against Mr. Farley concerning loans Mr. Farley caused the company take from PowerUp Lending Group Ltd. and Auctus Fund LLC from September 2017 through March 2018. Mr. Farley responded to the amended complaint by filing a motion to dismiss the lawsuit based on Delaware Court of Chancery Rules 12(b)(3) and 12(b)(7). On September 28, 2019, the Delaware Chancery Court denied this motion. On July 7, 2019, the company filed a motion to reduce or eliminate the cash bond requirement. As previously reported, the cash bond was required by the Delaware Chancery Court. On September 30, 2019, the Delaware Chancery Court denied the motion. On July 19, 2019, Mr. Farley and AMC filed answers and amended counter claims in response to the Company's amended complaint. The amended counter claims add claims under Delaware General Corporate Law section 205, seeking to validate the stock issuances at issue in the litigation. On July 29, 2019, the Delaware Chancery Court entered a scheduling order which, among other deadlines, rescheduled the trial date to begin on January 21, 2020. However, recently the judge presiding in the case, Vice Chancellor Montgomery-Reeves, was appointed and confirmed to the Delaware Supreme Court. Though no formal order has yet issued, the company expects the trial date to be postponed to mid-2020. On September 26, 2019, the company filed a motion for partial summary judgment concerning the issuance of company stock to Mr. Farley without having been authorized by a quorum of the board of directors. The previous hearing date of November 20, 2019, was postponed while the case awaited a new judge assignment. The case was reassigned to Vice Chancellor J. Travis Laster. On January 14, 2020, Vice Chancellor Laster held a scheduling conference. On January 29, 2020, the Delaware Chancery Court entered a scheduling order setting the trial date for July 20, 2020. In a related matter, on February 8, 2019, the company filed a complaint against Stein Riso Mantel McDonough, LLP ("Stein Riso"), its former counsel, in the United States District Court for the Southern District of New York alleging the following: 1. breach of fiduciary duty; 2. legal malpractice; 3. aiding and abetting a breach of fiduciary duty; 4. voidance of fees under New York Rules of Professional Conduct 1.8; 5. violation of New York Rule of Professional Conduct 1.5; 6. securities fraud; 7. breach of contract; and 8. unjust enrichment. The complaint against Stein Riso followed the issuance, on January 23, 2019, of a Memorandum Opinion granting the company's motion for a preliminary injunction by the Delaware Court of Chancery in the case against George Farley and AMC. Stein Riso has responded to the complaint by filing a motion to dismiss the complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). The company amended its complaint in response. On July 31, 2019, Stein Riso responded to the company's amended complaint by filing another motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6). The company filed an opposition to this motion on August 14, 2019. Stein Riso filed a reply brief on September 13, 2019. The United States District Court has not yet ruled on the motion. On July 3, 2019, Gusrae, Kaplan & Nusbaum and its partner, Ryan Whalen, counsel for defendants, George Farley and AnneMarie Co. LLC, in the litigation brought by the company and pending in Delaware, filed a claim in the District Court for the Southern District of New York against the company its directors, officers, attorneys and a consultant. The action alleges libel, securities fraud and related claims. The company believes that this suit lacks merit and intends to dispute these allegations. The company filed a motion to dismiss the complaint on October 24, 2019. On December 13, 2019, Gusrae Kaplan and Mr. Whalen filed an opposition to the Company's motion. On January 10, 2020, the company filed a reply brief. The United States District Court has not yet ruled on the motion. On September 24, 2019, the company filed a complaint in the Court of Common Pleas in the County of Beaufort, South Carolina, to prevent the sale of certain property located there (or in the alternative, to require payment of proceeds from any sale of the property into the registry of the court until a final decision is entered in the matter), in order to protect the company from having property disposed of. Effective January 8, 2020, this complaint was dismissed. As with any litigation, the company cannot predict the outcome with certainty, but the company expects to provide further updates on the status of the litigation as circumstances warrant. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2020 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 12. SUBSEQUENT EVENTS In April 2020, the company received $10,500 from a non-affiliate individual for the exercise of a warrant for 150,000 shares of the company's common stock. In April 2020, the company received $63,000 from a non-affiliate individual for the exercise of an option for 900,000 shares of the company's common stock. In April 2020, the company received $532,000 from three non-affiliate individuals for subscription agreements to purchase the company's common stock for $0.30 a share. Effective March 4, 2020, Applied Energetics, Inc. entered into the Phase I Small Business Technology Transfer (STTR) contract referred to in its prior Current Report on Form 8-K filed on January 6, 2020 with the United States Army. The contract is for the development of Standoff Electronic Denial systems. Phase I is to be completed within the first 90 days. The company will collaborate with the Laser Plasma Laboratory (LPL) at the University of Central Florida (UCF) in performing its research under the contract. The total contract amount for Phase I is $165,920. On April 20, 2020, we received $66,367.91 based on this contract with the Army. On April 28, 2020, we received proceeds from a Small Business Administration Paycheck Protection Program loan of $132,760.00. The company's management has evaluated subsequent events occurring after March 31, 2020, the date of our most recent balance sheet, through the date our financial statements were issued. |
Basis of Presentation and Goi_2
Basis of Presentation and Going Concern (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
LIQUIDITY AND MANAGEMENTS PLAN | LIQUIDITY AND MANAGEMENT'S PLAN The accompanying unaudited financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. For the three months ended March 31, 2020, the company incurred a net loss of approximately $1,265,000, had negative cash flows from operations of approximately $981,000, conducted financing activities yielding $1,113,000 in proceeds from the issuance of common stock and $194,000 in proceeds from notes payable, partially offset by payments on notes payable of $120,000 and expects to incur additional future losses due to the reactivation of its business activities. These matters raise substantial doubt as to the company's ability to continue as a going concern unless the company is able to obtain additional financing for its continuing operations. The financial statements do not include any adjustments relating to the recoverability of assets and the amount or classification of liabilities that might be necessary should the company be unable to continue as a going concern. As of March 31, 2020, the company had approximately $296,000 in cash and cash equivalents. |
USE OF ESTIMATES | USE OF ESTIMATES The preparation of consolidated financial statements in conformity with United States Generally Accepted Accounting Principles ("GAAP") requires management to make estimates, judgments and assumptions that affect the amounts reported in the financial statements and accompanying notes. Management bases its assumptions on historical experiences and on various other estimates that it believes 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. In addition, management considers the basis and methodology used in developing and selecting these estimates, the trends in and amounts of these estimates, specific matters affecting the amount of and changes in these estimates, and any other relevant matters related to these estimates, including significant issues concerning accounting principles and financial statement presentation. Such estimates and assumptions could change in the future, as more information becomes known which could materially impact the amounts reported and disclosed herein. Significant estimates include measurements of income tax assets and liabilities. Multiple contract proposals were submitted to various government agencies in 2019 and 2020. Due to the COVID-19 related closures of multiple agencies and work-from-home orders across various regions of the United States, we anticipate that reviews and funding decisions on these proposals might be delayed longer than anticipated as resources are focused on other matters within the government. |
REVENUE RECOGNITION | REVENUE RECOGNITION A majority of revenue under long-term government contracts is recorded under the percentage of completion method. Revenue, billable monthly under cost plus fixed fee contracts, is recorded as costs are incurred and includes estimated earned fees in the proportion that costs incurred to date bear to total estimated costs. Costs include direct labor, direct materials, subcontractor costs and manufacturing and administrative overhead allowable under the contract. General and administrative expenses allowable under the terms of contracts are allocated per contract, depending on its direct labor and material proportion to total direct labor and material of all contracts. As contracts can extend over one or more accounting periods, revisions in earnings estimated during the course of work are reflected during the accounting period in which the facts become known. When the current contract estimate indicates a loss, a provision is made for the total anticipated loss in the current period. We do not generally provide an allowance for returns from our government customers because our customer agreements do not provide for a right of return. The asset caption "accounts receivable" includes costs and estimated earnings in excess of billings on uncompleted contracts, which represents revenue recognized in excess of amounts billed. Such revenue is billable under the terms of contracts at the end of the year, but was not invoiced until the following year and is generally expected to be collected within one year. Revenue for other products and services is recognized when such products and services are delivered or performed and, in connection with certain sales to Government agencies, when the products and services are accepted, which is normally negotiated as part of the initial contract. Revenue from commercial, non-Governmental, customers is based on fixed price contracts where the sale is recognized upon acceptance of the product or performance of the service and when payment is probable. Contract costs are deferred in the same manner as inventory costs and are charged to operations as the related revenue from contracts is recognized. When a current contract estimate indicates a loss, a provision is made for the total anticipated loss in the period in which such facts become evident. |
RECENT ACCOUNTING PRONOUNCEMENTS | RECENT ACCOUNTING PRONOUNCEMENTS The company has reviewed issued accounting pronouncements and plans to adopt those that are applicable to it. The company does not expect the adoption of any other pronouncements to have an impact on its results of operations or financial position. |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of share-based compensation | three months ended 2020 2019 Expected life (years) N/A N/A Dividend yield N/A N/A Expected volatility N/A N/A Risk free interest rates N/A N/A Weighted average fair value of options at grant date N/A N/A |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of net loss per share | three months ended 2020 2019 Options to purchase common shares 31,400,000 27,750,000 Warrants to purchase common shares 3,650,000 200,000 Convertible preferred stock 47,466 44,632 Total potentially dilutive securities 35,097,466 27,994,632 |
Notes Payable (Tables)
Notes Payable (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Notes Payable [Abstract] | |
Schedule of notes payable | March 31, December 31, Notes payable $ 4,988,065 $ 4,880,000 Accrued interest 176,423 119,218 Payments on notes payable (205,226 ) (85,657 ) Transfer from prepaid 54,329 54,329 - $ 5,013,591 $ 4,967,890 |
Basis of Presentation and Goi_3
Basis of Presentation and Going Concern (Details) - USD ($) | 3 Months Ended | |||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | |
Basis of Presentation and Going Concern (Textual) | ||||
Net loss | $ 1,265,000 | |||
Cash flows from operations | 787,000 | |||
Proceeds from issuance of common stock | 1,113,000 | $ 150,000 | ||
Payment on note payable | 120,000 | |||
Cash and cash equivalents | 296,133 | $ 80,828 | $ 88,415 | $ 178,552 |
Interim Unaudited Condensed Consolidated Financial Statements [Member] | ||||
Basis of Presentation and Going Concern (Textual) | ||||
Net loss | 1,265,000 | |||
Cash flows from operations | 787,000 | |||
Working capital deficit | 3,622,000 | |||
Proceeds from issuance of common stock | 1,113,000 | |||
Cash and cash equivalents | $ 296,000 |
Share-Based Compensation (Detai
Share-Based Compensation (Details) - $ / shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | ||
Expected life (years) | 0 years | 0 years |
Dividend yield | ||
Expected volatility | ||
Risk free interest rates | ||
Weighted average fair value of options at grant date |
Share-Based Compensation (Det_2
Share-Based Compensation (Details Textual) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Share-Based Compensation (Textual) | ||
Share-based compensation expense | $ 440,000 | $ 123,000 |
Restricted stock awards granted | ||
Stock Option [Member] | ||
Share-Based Compensation (Textual) | ||
Share-based compensation, option awards, granted | 0 | |
Options to purchase stock were forfeited | 0 | |
Share-based compensation, options exercised | 0 | |
Share-based compensation, options forfeited | 0 | |
Share-based compensation, options expired | 0 | |
Share-based compensation, options outstanding | 31,400,000 | |
Share-based compensation, options outstanding, weighted average exercise price (in dollars per share) | $ 0.143 | |
Share-based compensation, options outstanding, weighted average remaining contractual term | 6 years 4 months 24 days | |
Options outstanding aggregate intrinsic value | $ 3,811,000 | |
Options exercisable (in shares) | 21,688,000 | |
Unrecognized compensation costs related to unvested equity awards, net of estimated forfeitures | $ 1,436,000 | |
Weighted average basis over period | 2 years |
Net Loss Per Share (Details)
Net Loss Per Share (Details) - shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total potentially dilutive securities | 35,097,466 | 27,994,632 |
Options to purchase common shares [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total potentially dilutive securities | 31,400,000 | 27,750,000 |
Warrants to purchase common shares [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total potentially dilutive securities | 3,650,000 | 200,000 |
Convertible preferred stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total potentially dilutive securities | 47,466 | 44,632 |
Dividends (Details)
Dividends (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Dividends (Textual) | ||
Initial dividend rate | 6.50% | |
Increase in dividend rate on default of payment | 7.50% | |
Increase in dividend rate on two consecutive default of payment | 10.00% | |
Series A convertible preferred stock outstanding (in shares) | 13,602 | 13,602 |
Amount of arrears dividend | $ 230,000 | |
Series A preferred stock has a liquidation preference (in dollars per share) | $ 25 | |
Percentage of weighted average of common stock sales price | 95.00% | |
Percentage of preferred stock outstanding | 6.50% |
Notes Payable (Details)
Notes Payable (Details) - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2020 | Dec. 31, 2019 | |
Notes Payable [Abstract] | ||
Notes payable | $ 3,513,591 | $ 3,467,890 |
Accrued interest | 176,423 | 119,218 |
Payments on notes payable | (205,226) | (85,657) |
Transfer from prepaid | 54,329 | 54,329 |
Reconciles notes payable | $ 5,013,591 | $ 4,967,890 |
Notes Payable (Details Textual)
Notes Payable (Details Textual) - USD ($) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Notes Payable (Textual) | |||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | |
Repayment of convertible notes | $ 119,569 | ||
Interest expense | $ 4,440 | ||
Payment, description | $96,000, is payable monthly over eight monthly payments, is due December 12, 2020, and $2,500,000 is payable in $500,000 semi-annual payments starting May 24, 2020 and is due May 24, 2022. | ||
Premium financing agreement [Member] | |||
Notes Payable (Textual) | |||
Notes Payable Current | $ 96,000 | ||
Principal amount | 108,000 | ||
Monthly payment | $ 12,498 | ||
Interest rate | 9.70% | ||
Promissory Notes [Member] | |||
Notes Payable (Textual) | |||
Description of affiliated individuals | The company received $400,000 from three non-affiliated individuals based on 10% Promissory Notes (“Notes”). The Notes matured September 1, 2019. | ||
10% Promissory Notes Due September 01, 2019 [Member] | Non affiliated Individuals [Member] | |||
Notes Payable (Textual) | |||
Note principal | $ 2 | ||
Common stock, par value (in dollars per share) | $ 0.001 | ||
Exercise price | $ 0.07 | ||
Note maturity date | Sep. 1, 2019 | ||
Debt interest rate (in percent) | 10.00% | ||
Interest expense | $ 10,000 | $ 4,000 | |
Notes | $ 444,000 | $ 434,000 | |
Number of warrants issued | 200,000 | ||
Due September 01, 2019 [Member] | |||
Notes Payable (Textual) | |||
Note maturity date | Sep. 1, 2019 | ||
Notes payable | $ 1,151,000 | ||
Interest rate | 10.00% | ||
Due December 1, 2019 [Member] | |||
Notes Payable (Textual) | |||
Note maturity date | Dec. 1, 2019 | ||
Notes payable | $ 1,267,000 | ||
Interest rate | 9.70% | ||
Due May 24, 2022 [Member] | |||
Notes Payable (Textual) | |||
Interest rate | 0.00% |
Due to Related Parties (Details
Due to Related Parties (Details) | Jul. 31, 2018USD ($) |
CEO [Member] | |
Due to Related Parties (Textual) | |
Deposited | $ 50,000 |
Stockholders Deficit (Details)
Stockholders Deficit (Details) - USD ($) | 3 Months Ended | ||||||||||||
Mar. 31, 2020 | Apr. 29, 2020 | Apr. 23, 2020 | Apr. 08, 2020 | Feb. 19, 2020 | Jan. 31, 2020 | Jan. 30, 2020 | Jan. 24, 2020 | Jan. 23, 2020 | Jan. 22, 2020 | Jan. 15, 2020 | Jan. 13, 2020 | Dec. 31, 2019 | |
Series A convertible preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | |||||||||||
Series A convertible preferred stock, authorized | 2,000,000 | 2,000,000 | |||||||||||
Series A convertible preferred stock, issued | 13,602 | 13,602 | |||||||||||
Series A convertible preferred stock, outstanding | 13,602 | 13,602 | |||||||||||
Share Based Compensation, description | The $440,000 stock-based compensation for the quarter ended March 31, 2020 was comprised of $273,000 option expense and $167,000 was the amortization of 5,000,000 shares of stock valued at $0.4014 over three years for the acquisition of Applied Optical Sciences. | ||||||||||||
Subscription Agreements [Member] | |||||||||||||
Number of common stock issued | 1,333,333 | 240,000 | 200,000 | 1,700,000 | 2,500,000 | 200,000 | 680,000 | 680,000 | 100,000 | 150,000 | |||
Common stock value | $ 400,000 | $ 72,000 | $ 60,000 | $ 510,000 | $ 150,000 | $ 60,000 | $ 204,000 | $ 204,000 | $ 30,000 | $ 45,000 | |||
Subscription Agreements One [Member] | |||||||||||||
Number of common stock issued | 200,000 | ||||||||||||
Common stock value | $ 60,000 | ||||||||||||
Warrants Exercise [Member] | |||||||||||||
Number of common stock issued | 150,000 | 25,000 | |||||||||||
Common stock value | $ 10,500 | $ 1,750 | |||||||||||
Options Exercise [Member] | |||||||||||||
Number of common stock issued | 900,000 | ||||||||||||
Common stock value | $ 63,000 |
Legal Proceedings (Details)
Legal Proceedings (Details) - USD ($) | Jan. 29, 2019 | Jan. 23, 2019 | Oct. 24, 2018 | Oct. 16, 2018 | Aug. 30, 2018 | Aug. 23, 2018 | Aug. 21, 2018 | Aug. 14, 2018 | Jul. 03, 2018 | Jan. 20, 2018 | Mar. 31, 2020 |
Legal Proceedings (Textual) | |||||||||||
Cash deposited | $ 200,447 | ||||||||||
Additional cash deposited | $ 185,302 | $ 55,447 | |||||||||
Collateral for the Surety Agreement [Member] | |||||||||||
Legal Proceedings (Textual) | |||||||||||
Cash deposited | $ 200,447 | ||||||||||
Additional cash deposited | $ 582,378 | ||||||||||
Atlantic Specialty Insurance Company [Member] | Collateral for the Surety Agreement [Member] | |||||||||||
Legal Proceedings (Textual) | |||||||||||
Additional cash deposited | $ 55,447 | ||||||||||
Mr. Farley and AMC [Member] | |||||||||||
Legal Proceedings (Textual) | |||||||||||
Common stock | $ 25,000,000 | ||||||||||
Number of shares issued in transaction | 25,000,000 | 25,000,000 | |||||||||
Additional cash deposited | $ 185,302 | ||||||||||
Description of preliminary injunction | In granting the preliminary injunction, the Court found that the company met "its considerable burden" of demonstrating it was likely to win its lawsuit against Mr. Farley and AMC. Specifically, the Court found it was "reasonably probable" Mr. Farley had unlawfully issued the 25 million shares without proper authorization, Mr. Farley had breached his duty of loyalty to the company, Mr. Farley was unlikely to prove the stock issuance was procedurally or substantively "fair" to the company, and Mr. Farley had fraudulently transferred 20 million of the shares to AMC. Finally, the Court ruled because Farley and AMC's 25 million shares represented one eighth of the company's outstanding ownership, the injunction was necessary to protect the company's capital structure, ability to attract new investors, ability to raise new capital and continue deployment of its plans now underway to revitalize its business. | ||||||||||
Mr. Farley [Member] | |||||||||||
Legal Proceedings (Textual) | |||||||||||
Additional cash deposited | 105,000 | ||||||||||
AMC [Member] | |||||||||||
Legal Proceedings (Textual) | |||||||||||
Additional cash deposited | $ 80,302 |
Subsequent Events (Details)
Subsequent Events (Details) | Apr. 30, 2020USD ($)Individuals$ / sharesshares | Apr. 28, 2020USD ($) | Mar. 04, 2020USD ($) |
Phase I [Member] | |||
Subsequent Event [Line Items] | |||
Contract amount | $ 165,920 | ||
Contract amount received | $ 66,368 | ||
Subsequent Event [Member] | |||
Subsequent Event [Line Items] | |||
Paycheck Protection Program loan | $ 132,760 | ||
Subsequent Event [Member] | Non Affiliated Individuals [Member] | Subscription Agreements [Member] | |||
Subsequent Event [Line Items] | |||
Contribution of capital individual | $ 532,000 | ||
Non-affiliated individuals | Individuals | 3 | ||
Common stock price | $ / shares | $ 0.30 | ||
Subsequent Event [Member] | Non Affiliated Individuals [Member] | Warrants Exercise [Member] | |||
Subsequent Event [Line Items] | |||
Contribution of capital individual | $ 10,500 | ||
Number of shares issued (in shares) | shares | 150,000 | ||
Subsequent Event [Member] | Non Affiliated Individuals [Member] | Options Exercise [Member] | |||
Subsequent Event [Line Items] | |||
Contribution of capital individual | $ 63,000 | ||
Number of shares issued (in shares) | shares | 900,000 |