Document_And_Entity_Informatio
Document And Entity Information | 9 Months Ended | |
Sep. 30, 2013 | Nov. 08, 2013 | |
Document Information [Line Items] | ' | ' |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 30-Sep-13 | ' |
Document Fiscal Year Focus | '2013 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Trading Symbol | 'WSGI | ' |
Entity Registrant Name | 'World Surveillance Group Inc. | ' |
Entity Central Index Key | '0000919742 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Entity Common Stock, Shares Outstanding | ' | 644,032,984 |
CONDENSED_CONSOLIDATED_BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
CURRENT ASSETS | ' | ' |
Cash | $350,290 | $49,343 |
Accounts receivable | 79,164 | 8,977 |
Accounts receivable from related party | 20,359 | 48,220 |
Inventories | 38,187 | 0 |
Prepaid expenses | 39,622 | 46,134 |
Deposits | 0 | 50,000 |
TOTAL CURRENT ASSETS | 527,622 | 202,674 |
PROPERTY AND EQUIPMENT | ' | ' |
Property and equipment, net of accumulated depreciation of $450,681 and $355,420, respectively | 2,318,516 | 2,452,966 |
OTHER NONCURRENT ASSETS | ' | ' |
Goodwill | 871,256 | 0 |
Deferred financing costs | 32,736 | 43,074 |
TOTAL NONCURRENT ASSETS | 903,992 | 43,074 |
TOTAL ASSETS | 3,750,130 | 2,698,714 |
CURRENT LIABILITIES | ' | ' |
Accounts payable | 4,381,411 | 4,781,075 |
Notes payable | 9,391,529 | 8,938,380 |
Other accrued liabilities | 3,200,808 | 2,132,085 |
Deferred revenues | 0 | 7,500 |
Derivative liabilities | 0 | 363 |
TOTAL CURRENT LIABILITIES | 16,973,748 | 15,859,403 |
COMMITMENTS AND CONTINGENCIES | ' | ' |
STOCKHOLDERS' DEFICIT | ' | ' |
Common stock, $0.00001 par value, 1,000,000,000 shares authorized at September 30, 2013 and 750,000,000 authorized at December 31, 2012; 637,722,024 shares and 546,887,530 shares issued and outstanding at September 30, 2013 and December 31, 2012, respectively. | 6,377 | 5,469 |
Additional paid-in capital | 138,168,471 | 135,829,194 |
Accumulated deficit | -151,398,466 | -148,995,352 |
TOTAL STOCKHOLDERS' DEFICIT | -13,223,618 | -13,160,689 |
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT | $3,750,130 | $2,698,714 |
CONDENSED_CONSOLIDATED_BALANCE1
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Property and equipment, accumulated depreciation | $450,681 | $355,420 |
Common stock, par value | $0.00 | $0.00 |
Common stock, shares authorized | 1,000,000,000 | 750,000,000 |
Common stock, shares issued | 637,722,024 | 546,887,530 |
Common stock, shares outstanding | 637,722,024 | 546,887,530 |
CONDENSED_CONSOLIDATED_STATEME
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
REVENUES | ' | ' | ' | ' |
Contract revenues | $0 | $0 | $0 | $200,000 |
Product sales | 279,765 | 190,951 | 1,456,222 | 689,344 |
Cost of sales | 264,860 | 164,794 | 1,053,665 | 611,242 |
Gross profit | 14,905 | 26,157 | 402,557 | 78,102 |
NET REVENUES | 14,905 | 26,157 | 402,557 | 278,102 |
COSTS AND EXPENSES: | ' | ' | ' | ' |
General and administrative | 784,105 | 407,397 | 1,684,694 | 2,403,391 |
Professional fees | 118,262 | 272,826 | 348,188 | 809,791 |
Acquisition-related costs | 0 | 0 | 21,000 | 0 |
Depreciation expense | 46,583 | 45,750 | 138,363 | 137,250 |
Research and development | 0 | 42,250 | 300 | 171,700 |
TOTAL EXPENSES | 948,950 | 768,223 | 2,192,545 | 3,522,132 |
LOSS FROM OPERATIONS | -934,045 | -742,066 | -1,789,988 | -3,244,030 |
OTHER INCOME (EXPENSE) | ' | ' | ' | ' |
Gain on write-off of assets and derecognition of liabilities of discontinued operations | 0 | 0 | 0 | 544,201 |
Gain on derecognition of legacy payables | 0 | 0 | 0 | 1,787,324 |
Loss from conversion agreement true-up | 0 | -135,958 | -233,381 | -373,078 |
Change in fair value of derivative liabilities | 0 | 6,518 | 363 | 125,364 |
Interest expense, net | -111,617 | -115,457 | -380,108 | -346,538 |
NET OTHER INCOME (EXPENSE) | -111,617 | -244,897 | -613,126 | 1,737,273 |
NET LOSS | ($1,045,662) | ($986,963) | ($2,403,114) | ($1,506,757) |
NET LOSS PER SHARE: | ' | ' | ' | ' |
Basic and Diluted | $0 | $0 | $0 | $0 |
WEIGHTED AVERAGE SHARES: | ' | ' | ' | ' |
Basic and Diluted | 519,340,666 | 437,528,245 | 597,936,763 | 402,920,267 |
CONDENSED_CONSOLIDATED_STATEME1
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT (USD $) | Total | COMMON STOCK | ADDITIONAL PAID-IN CAPITAL | ACCUMULATED DEFICIT |
Beginning Balance at Dec. 31, 2012 | ($13,160,689) | $5,469 | $135,829,194 | ($148,995,352) |
Beginning Balance (in shares) at Dec. 31, 2012 | ' | 546,887,530 | ' | ' |
Shares issued as inducement for loans (in shares) | ' | 2,000,000 | ' | ' |
Shares issued as inducement for loans | 34,400 | 20 | 34,380 | 0 |
Shares issued for cash (in shares) | ' | 6,000,000 | ' | ' |
Shares issued for cash | 120,000 | 60 | 119,940 | 0 |
Shares issued for legal settlement (in shares) | ' | 14,436,353 | ' | ' |
Shares issued for legal settlement | 227,900 | 144 | 227,756 | 0 |
Shares issued to services (in shares) | ' | 11,872,500 | ' | ' |
Shares issued to services | 236,250 | 119 | 236,131 | 0 |
Shares issued for LTAS acquisition (in shares) | ' | 25,000,000 | ' | ' |
Shares issued for LTAS acquisition | 672,500 | 250 | 672,250 | 0 |
Shares issued for accrued salaries (in shares) | ' | 7,692,308 | ' | ' |
Shares issued for accrued salaries | 100,000 | 77 | 99,923 | 0 |
Shares issued for employee and directors’ compensation (in shares) | ' | 4,900,000 | ' | ' |
Shares issued for employee and directors’ compensation | 13,890 | 49 | 13,841 | 0 |
Shares issued for convertible debt conversion (in shares) | ' | 2,933,333 | ' | ' |
Shares issued for convertible debt conversion | 76,339 | 29 | 76,310 | 0 |
Fair value of vested restricted shares issued as retention bonuses (in shares) | ' | 16,000,000 | ' | ' |
Fair value of vested restricted shares issued as retention bonuses | 9,312 | 160 | 9,152 | 0 |
Fair value of vested options issued as share-based compensation and director’s fees (in shares) | ' | 0 | ' | ' |
Fair value of vested options issued as share-based compensation and director’s fees | 324,970 | 0 | 324,970 | 0 |
Fair value of vested options issued for salary conversion | 524,624 | 0 | 524,624 | 0 |
Net loss | -2,403,114 | 0 | 0 | -2,403,114 |
Ending Balance at Sep. 30, 2013 | ($13,223,618) | $6,377 | $138,168,471 | ($151,398,466) |
Ending Balance (in shares) at Sep. 30, 2013 | ' | 637,722,024 | ' | ' |
CONDENSED_CONSOLIDATED_STATEME2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 9 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
OPERATING ACTIVITIES: | ' | ' |
Net loss | ($2,403,114) | ($1,506,757) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ' | ' |
Depreciation expense | 138,363 | 137,250 |
Share-based compensation | 33,102 | 1,283,778 |
Fair value of vested options | 324,970 | 0 |
Loss on conversion of debt | 233,382 | 373,077 |
Change in fair value of derivative liabilities | -363 | -125,364 |
Gain on write-off of assets and derecognition of liabilities of discontinued operations | 0 | -544,201 |
Gain on derecognition of legacy payables | 0 | -1,787,324 |
Loan interest capitalized to debt | 339,984 | 314,557 |
Amortized deferred financing costs | 10,338 | 13,783 |
Shares issued as inducement for loans | 34,400 | 0 |
Change in operating assets and liabilities: | ' | ' |
Accounts receivable | 136,880 | -41,553 |
Inventories | 191,511 | 4,500 |
Prepaid expenses | 9,478 | -24,850 |
Deposits | 50,000 | 0 |
Accounts payable | -156,904 | 482,843 |
Other accrued liabilities | 1,187,875 | 595,604 |
Deferred revenues | -7,500 | -189,660 |
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | 122,402 | -1,014,317 |
INVESTING ACTIVITIES: | ' | ' |
Cash acquired in acquisition | 158,545 | 0 |
NET CASH PROVIDED BY INVESTING ACTIVITIES | 158,545 | 0 |
FINANCING ACTIVITIES: | ' | ' |
Proceeds from debenture, net of deferred financing costs | 0 | 437,974 |
Proceeds from convertible debt conversions | 0 | 585,000 |
Payment on LTAS acquisition payable | -110,000 | 0 |
Payment to LTAS selling shareholder | -140,000 | 0 |
Proceeds from notes payable | 150,000 | 0 |
Proceeds from sale of common stock | 120,000 | 0 |
NET CASH PROVIDED BY FINANCING ACTIVITIES | 20,000 | 1,022,974 |
NET INCREASE IN CASH AND EQUIVALENTS | 300,947 | 8,657 |
CASH AND EQUIVALENTS, BEGINNING OF PERIOD | 49,343 | 5,532 |
CASH AND EQUIVALENTS, END OF PERIOD | 350,290 | 14,189 |
SUPPLEMENTAL INFORMATION: | ' | ' |
Interest paid | 3,688 | 0 |
SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES | ' | ' |
Reclassification of long-term convertible notes payable to current notes payable | 267,000 | 0 |
Common stock issued for services | 236,250 | 274,979 |
Common stock issued for settlements | 227,900 | 106,700 |
Common stock issued for convertible debt conversions | 76,339 | 761,235 |
Common stock issued for acquisition | 672,500 | 0 |
Common stock issued for accrued salary conversion | 100,000 | 0 |
Fair value of vested options issued for accrued salary conversion | 524,624 | 0 |
Due to LTAS selling shareholder | 413,432 | 0 |
LTAS acquisition payable | $140,000 | $0 |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES | 9 Months Ended | ||
Sep. 30, 2013 | |||
Summary Of Significant Accounting Principles [Abstract] | ' | ||
SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES | ' | ||
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES | |||
DESCRIPTION OF BUSINESS | |||
World Surveillance Group Inc. (the “Company”) designs, develops, markets, and sells, autonomous lighter-than-air (LTA) aerostats and unmanned aerial systems (UAS) capable of carrying payloads that provide semi-persistent intelligence, surveillance and reconnaissance (ISR), security and/or wireless communications from air to ground solutions at low and mid altitudes. The Company’s business focuses primarily on the design and development of innovative aerostats and UAS that provide situational awareness and other communications capabilities via the integration of wireless capabilities and customer payloads. The Company’s aerostats and airships, when integrated with cameras, electronics systems and other high technology payloads, are designed for use by government-related and commercial entities that require real-time ISR or communications support for military, homeland defense, border control, drug interdiction, natural disaster relief, maritime and environmental missions. | |||
The Company’s wholly owned subsidiary Global Telesat Corp. (GTC), provides mobile voice and data communications services globally via satellite to the U.S. government, defense industry and commercial users. GTC specializes in services related to the Globalstar satellite constellation, including satellite telecommunications voice airtime, tracking devices and services, and ground station construction. GTC has an e-commerce mobile satellite solutions portal and is an authorized reseller of satellite telecommunications equipment and services offered by other leading satellite network providers such as Inmarsat, Iridium, Globalstar and Thuraya. GTC also has a new subscription based online tracking portal called GTCTrack, designed to attract new satellite and GSM tracking customers by offering an easy-to-use interface and compatibility with a wide range of devices. GTC’s equipment is installed in various ground stations across Africa, Asia, Australia, Europe and South America. | |||
The Company’s wholly owned subsidiary Lighter Than Air Systems Corp. (LTAS), provides critical aerial and land-based surveillance and communications solutions to government and commercial customers. LTAS systems are designed and developed in-house utilizing proprietary technologies and processes that result in compact, rapidly deployable aerostat solutions and mast-based ISR systems. The LTAS systems have been proven to fulfill critical requirements of the military and law enforcement in the U.S. and internationally. | |||
BASIS OF PRESENTATION | |||
The accompanying unaudited condensed consolidated financial statements include the accounts of World Surveillance Group Inc. and its subsidiaries (“WSGI” or the “Company”) and have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) for interim financial information and reports and pursuant to the requirements for reporting on Form 10-Q and Regulation S-X for scaled disclosures for smaller reporting companies. Accordingly, they do not include all, or include a condensed version of, the information and footnotes required by U.S. GAAP for complete financial statements. The Company believes, however, that the disclosures are adequate to make the information presented not misleading. Therefore, the Company’s condensed consolidated financial statements reflect all adjustments (consisting solely of normal recurring adjustments), which are, in the opinion of management, necessary for the fair presentation of the consolidated financial position and the consolidated results of operations of the Company for the periods shown. Results shown for interim periods are not necessarily indicative of the results to be obtained for a full fiscal year or for any future period. The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates, judgments and assumptions that affect the amounts reported in the condensed consolidated financial statements. Actual results may differ from management’s estimates. | |||
The consolidated balance sheet information as of December 31, 2012 was derived from the audited consolidated financial statements included in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) for the fiscal year ended December 31, 2012. These interim condensed consolidated financial statements should be read in conjunction with the Company’s most recently audited financial statements and the notes thereto included in such above referenced Annual Report on Form 10-K. | |||
RECLASSIFICATIONS | |||
Certain 2012 amounts have been reclassified to conform to the 2013 presentation. | |||
GOING CONCERN | |||
The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. However, as reflected in the accompanying condensed consolidated financial statements, the Company incurred a loss from operations of $1,789,988 for the nine months ended September 30, 2013. The Company also had a working capital deficit of $16,446,126 and total stockholders’ deficit of $13,223,618, as well as an accumulated deficit for $151,398,466 at September 30, 2013. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent upon its ability to raise additional funds either through investments or by generating revenue from the sale of the Company’s products to continue its business operations and implement its strategic plan, which includes, among other things, continued development of its aerostats and UAS, the pursuit or continued development of strategic relationships and expansion of the Company’s subsidiaries’ businesses. The Company’s business plan, which if successfully implemented, will allow it to sell aerostats, UAS and other products for a profit, which in turn will reduce the Company’s dependence on raising additional funds from outside sources. The condensed consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. The Company anticipates a net loss to continue for the next several quarters. | |||
Additional cash will be needed to support our ongoing operations until such time that operations provide sufficient cash flow to cover expenditures. We are currently pursuing both short and long-term financing options from private investors as well as through institutional investors. We are also working to commercialize our aerostats, Argus One airship, and our subsidiaries’ products to generate revenues from customers. We anticipate generating revenues from the sale of our airships in 2014 and are already generating revenue from our aerostats and our subsidiaries’ products. The costs associated with our strategic plan are variable and contingent on our ability to raise capital or generate revenue from customer contracts, but we expect to need funding of approximately $3 million over the next 12 months. We are currently in litigation with La Jolla Cove Investors and do not expect any future funding under those agreements. We continue to have discussions with various entities relating to funding, but there can be no assurance that such funding will be received in the amounts required, on a timely basis, or at all. While we believe we will be able to continue to raise capital from various funding sources in such amounts sufficient to sustain operations at our current levels through the next several quarters, if we are not able to do so and if we are not able to generate sufficient revenue through the sale of our products, we would likely need to modify our strategy or cut back or terminate some of our operations. If we are able to raise additional funds through the issuance of equity securities, substantial dilution to existing shareholders may result. However, if our plans are not achieved, if significant unanticipated damaging events occur, or if we are unable to obtain the necessary additional funding on favorable terms or at all, we will likely have to modify our business plan and reduce, delay or discontinue some or all of our operations to continue as a going concern or seek a buyer for all or a portion of our assets. As of the date hereof, we continue to raise capital to sustain our current operations. | |||
REVENUE RECOGNITION | |||
The Company recognizes revenue when all four of the following criteria are met: 1) persuasive evidence of an arrangement exists; 2) delivery has occurred and title has transferred or services have been rendered; 3) our price to the buyer is fixed or determinable; and 4) collectability is reasonably assured. The Company records unearned contract revenues and subscription fees as deferred revenues and their associated costs of sales as prepaid expenses. Deferred revenues from subscription fees and their related costs are amortized pro-ratable over the subscription term. Deferred revenues from contracts and their related costs are recognized upon completion and fulfillment of the contractual obligation using the completed contract method. | |||
INCOME TAXES | |||
The Company accounts for income taxes using the asset and liability approach. Under this approach, deferred income taxes are recognized based on the tax effects of temporary differences between the financial statement and tax bases of assets and liabilities, as measured by current enacted tax rates. Valuation allowances are recorded to reduce the deferred tax assets to an amount that will more likely than not be realized. | |||
U.S. GAAP requires that, in applying the liability method, the financial statement effects of an uncertain tax position be recognized based on the outcome that is more likely than not to occur. Under this criterion the most likely resolution of an uncertain tax position should be analyzed based on technical merits and on the outcome that will likely be sustained under examination. There were no adjustments related to uncertain tax positions recognized during the nine months ended September 30, 2013 and 2012, respectively. | |||
FAIR VALUE MEASUREMENTS | |||
U.S. GAAP includes a framework for measuring fair value, which also addresses disclosure requirements for fair value measurements. Fair value is the price that would be received upon sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date and in the principal or most advantageous market for that asset or liability. The fair value, in this context, should be calculated based on assumptions that market participants would use in pricing the asset or liability, not on assumptions specific to the entity. In addition, the fair value of liabilities should include consideration of non-performance risk, including the Company’s own credit risk. | |||
Under the measurement framework, a fair valuation hierarchy for disclosure of the inputs to valuation used to measure fair value has been established. This hierarchy prioritizes the inputs into three broad levels that reflect the degree of subjectivity necessary to determine fair value measurements, as follows. Level 1 inputs are based on unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 inputs are based on 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 asset or liability. Level 3 inputs are unobservable inputs and reflect the Company’s estimates of assumptions that market participants would use to measure assets and liabilities at fair value. The fair values are therefore determined using model-based techniques that include option pricing models and discounted cash flow models. 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. | |||
DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS | |||
The Company’s financial instruments include cash, accounts payable, notes payable and derivative instruments. The carrying values for the current financial assets and liabilities approximate fair value due to their short maturity. The fair values of the Company’s derivative instruments are recorded in the condensed consolidated balance sheets. | |||
USE OF ESTIMATES | |||
The process of preparing financial statements in conformity with U.S. GAAP requires the use of estimates, judgments and assumptions regarding certain types of assets, liabilities, revenues, and expenses. These estimates, judgments and assumptions are evaluated on an ongoing basis. The Company bases its estimates on historical experience and on various other assumptions that it believes are reasonable at that time, 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. Such estimates primarily relate to unsettled transactions and events as of the date of the financial statements. Accordingly, upon settlement, actual results may differ from the Company’s estimated amounts. | |||
BASIC AND DILUTED NET LOSS PER COMMON SHARE | |||
Basic and diluted net loss per common share has been computed by dividing the net loss by the weighted average number of shares of common stock outstanding during each period. Whenever losses are reported, the weighted average number of common shares outstanding excludes common stock equivalents because their inclusion would result in a diluted loss per share less than the basic loss per share and therefore would be anti-dilutive. Whenever net income is reported, the weighted average number of common shares outstanding will include common stock equivalents that are in-the-money. If all outstanding options, warrants and convertible shares were converted or exercised at September 30, 2013, the shares outstanding would be 782,633,119. | |||
PROPERTY AND EQUIPMENT | |||
Property and equipment are carried at cost less accumulated depreciation. Depreciation is based on the estimated service lives of the depreciable assets and is calculated using the straight-line method. Expenditures that increase the value or productive capacity of assets are capitalized. Fully depreciated assets are retained in property and accumulated depreciation accounts until they are removed from service. When property and equipment are retired, sold or otherwise disposed of, the asset’s carrying amount and related accumulated depreciation are removed from the accounts and any gain or loss is included in operations. Repairs and maintenance are expensed as incurred. | |||
The estimated useful lives of property and equipment are generally as follows: | |||
Appliques | 15 – 25 years | ||
Machinery and equipment | 3 – 12 years | ||
Office furniture and fixtures | 3 – 10 years | ||
Computer hardware and software | 3 – 7 years | ||
LONG LIVED ASSETS | |||
The Company evaluates the fair value of long-lived assets on an annual basis or whenever events or changes in circumstances indicate that its carrying amounts may not be recoverable. Accordingly, any impairment of value is recognized when the carrying amount of a long-lived asset exceeds its fair value. The Company’s evaluations have not indicated any impairment of fair values. | |||
DERIVATIVE FINANCIAL INSTRUMENTS | |||
Derivative liabilities primarily relate to warrants to purchase common stock of the Company issued in conjunction with certain debt and equity financings. Each reporting period the Company determines the fair value of the stock warrants using the Black-Scholes option pricing model at the balance sheet date. Changes in the fair value of the stock warrants are recognized each period in current earnings. | |||
SHARE-BASED COMPENSATION | |||
The Company offers share-based compensation programs to its officers, directors and employees that consist of employee stock options, common stock and restricted stock awards. Common stock and restricted stock awards are issued at the closing price of the Company’s common stock on the date of grant. The Company recognizes compensation expense ratably over the vesting periods for restricted stock awards using the fair value of the stock on the vest date. The Black-Scholes option pricing model is used to value stock options, and compensation expense is recognized ratably over the requisite service period. Stock options typically have contractual terms of three to seven years. Share-based compensation for employees and non-employees is reflected in the appropriate functional expense category, principally the general administrative and research and development categories. Share-based compensation and vested options incurred during the nine months ended September 30, 2013 and 2012 was $972,796 and $1,283,778, respectively. | |||
ACQUISITIONS
ACQUISITIONS | 9 Months Ended | ||||||||||
Sep. 30, 2013 | |||||||||||
Business Combination, Description [Abstract] | ' | ||||||||||
ACQUISITIONS | ' | ||||||||||
NOTE 2. ACQUISITIONS | |||||||||||
On March 28, 2013, the Company consummated a Stock Purchase Agreement (the “Agreement”) by and among the Company, Lighter Than Air Systems Corp. (“LTAS”), Felicia Hess (the “Shareholder”) and Kevin Hess (“KHess”) pursuant to which the Company acquired 100% of the outstanding shares of capital stock of LTAS, thereby making LTAS a wholly-owned subsidiary of the Company. | |||||||||||
The purchase price paid by the Company for LTAS consisted of $250,000 in cash payable on or before the date that is 30 days after the closing of the acquisition (the “Closing”), 25,000,000 shares of the Company’s common stock valued at the acquisition date based on the market price of $0.0269 per share, and an earn-out based on varying percentages of the gross revenues based on the level of revenue from contracts with an identified group of potential customers. No value was ascribed to the earn-out because future revenues, if any, cannot be reliably predicted. Pursuant to the Agreement and an Escrow Agreement, 7,500,000 shares of common stock out of the 25,000,000 shares issued by the Company have been placed in escrow for one year to satisfy possible indemnification claims of the Company. Felicia Hess, the President of LTAS, has entered into an employment agreement to continue in her role as President of LTAS. The Agreement also includes restrictions on the sale of the Company’s securities issued as the purchase price by the Shareholder for a one-year period following the Closing. | |||||||||||
The Shareholder has the right pursuant to the Agreement to nominate one member of the Company’s Board of Directors, and as a result, the size of the Company’s Board of Directors has been increased and Felicia Hess has been appointed as a Class I director as of March 28, 2013. Since Ms. Hess would not be an “independent” director pursuant to the rules of the Securities and Exchange Commission, it is not expected that she will be appointed to any committees. | |||||||||||
In connection with the Closing, LTAS, the Shareholder and the Company also entered into an Option Agreement dated March 28, 2013 pursuant to which the Shareholder was granted an exclusive option to purchase the shares of LTAS held by WSGI on the occurrence of (i) a WSGI bankruptcy event, or (ii) a decrease in the daily volume of WSGI’s common stock to below 50,000 shares for 30 consecutive days, occurring within 18 months of the Closing at a purchase price equal to the fair market value of the LTAS stock at the time of such triggering event, as determined by an independent valuation firm. | |||||||||||
The common stock of the Company issued as purchase price pursuant to the Agreement was issued as restricted securities under an exemption provided by Section 4(2) of the Securities Act of 1933, as amended. The Agreement, however, provides the Shareholder with certain piggyback registration rights. | |||||||||||
LTAS provides critical aerial and land-based surveillance and communications solutions to government and commercial customers. LTAS systems are designed and developed in-house utilizing proprietary technologies and processes that result in compact, rapidly deployable aerostat solutions and mast-based ISR systems. The LTAS systems have been proven to fulfill critical requirements of the military and law enforcement in the U.S. and internationally. | |||||||||||
The Company’s Condensed Consolidated Balance Sheet at September 30, 2013 includes the accounts of LTAS. The operating results of LTAS since the acquisition date of March 28, 2013 are reflected in the Company’s Condensed Consolidated Statements of Operations. | |||||||||||
The following table summarizes the original allocation of the LTAS acquisition purchase price, which has been accounted at the fair values of the assets acquired and liabilities assumed under the acquisition method of accounting: | |||||||||||
Original | Allocation | Revised | |||||||||
Allocation | Adjustment | Allocation | |||||||||
Current assets | $ | 703,220 | $ | 7,195 | $ | 710,415 | |||||
Property and equipment | 1,357 | 2,556 | 3,913 | ||||||||
Goodwill | 479,585 | 391,671 | 871,256 | ||||||||
Due to selling shareholder | 0 | -413,432 | -413,432 | ||||||||
Current liabilities assumed | -261,662 | 12,010 | -249,652 | ||||||||
Total Purchase Price | $ | 922,500 | $ | 0 | $ | 922,500 | |||||
RELATED_PARTY_TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Sep. 30, 2013 | |
Related Party Transactions [Abstract] | ' |
RELATED PARTY TRANSACTIONS | ' |
NOTE 3. RELATED PARTY TRANSACTIONS | |
The accounts receivable from related party at September 30, 2013 reflects trade receivables from Global Telesat Communications, Ltd. (“GTCL”) of $20,359. GTCL is a related party based in the United Kingdom and controlled by a current officer of GTC. Total sales to GTCL for the three and nine-months ended September 30, 2013 were $95,641 and $391,646, respectively, and account for 47% and 33% of GTC’s total sales for the respective periods. In 2012, GTC began charging a 10% handling fee on all GTCL orders. | |
PROPERTY_AND_EQUIPMENT
PROPERTY AND EQUIPMENT | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Property, Plant and Equipment [Abstract] | ' | |||||||
PROPERTY AND EQUIPMENT | ' | |||||||
NOTE 4. PROPERTY AND EQUIPMENT | ||||||||
Property and equipment consisted of the following: | ||||||||
September 30, | ||||||||
2013 | December 31, | |||||||
(Unaudited) | 2012 | |||||||
Appliques | $ | 2,755,732 | $ | 2,755,732 | ||||
Office furniture and fixtures | 13,465 | 6,904 | ||||||
2,769,197 | 2,762,636 | |||||||
Less: accumulated depreciation | -450,681 | -309,670 | ||||||
$ | 2,318,516 | $ | 2,452,966 | |||||
OTHER_ACCRUED_LIABILITIES
OTHER ACCRUED LIABILITIES | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Other Accrued Liabilities [Abstract] | ' | |||||||
OTHER ACCRUED LIABILITIES | ' | |||||||
NOTE 5. OTHER ACCRUED LIABILITIES | ||||||||
Accrued liabilities consisted of the following: | ||||||||
September 30, | ||||||||
2013 | December 31, | |||||||
(Unaudited) | 2012 | |||||||
Payroll liabilities | $ | 1,667,280 | $ | 1,494,883 | ||||
Professional fees | 10,000 | 10,000 | ||||||
Accrued legal claims payable | 475,540 | 334,540 | ||||||
Accrued cash true-up from conversion | 353,873 | 176,831 | ||||||
Accrued interest on debenture | 24,740 | 18,243 | ||||||
GTC acquisition payable | 75,000 | 75,000 | ||||||
Due to LTAS selling shareholder | 413,432 | 0 | ||||||
LTAS acquisition payable | 140,000 | 0 | ||||||
Other | 40,943 | 22,588 | ||||||
OTHER ACCRUED LIABILITIES | $ | 3,200,808 | $ | 2,132,085 | ||||
NOTES_PAYABLE
NOTES PAYABLE | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Notes Payable [Abstract] | ' | |||||||
NOTES PAYABLE | ' | |||||||
NOTE 6. NOTES PAYABLE | ||||||||
Notes payable consisted of the following: | ||||||||
September 30, | ||||||||
2013 | December 31, | |||||||
(Unaudited) | 2012 | |||||||
Unsecured promissory notes | $ | 5,997,030 | $ | 5,997,030 | ||||
Unsecured short-term promissory notes | 150,000 | 0 | ||||||
Convertible debenture | 267,000 | 287,000 | ||||||
Accrued interest | 2,977,499 | 2,654,350 | ||||||
NOTES PAYABLE | $ | 9,391,529 | $ | 8,938,380 | ||||
At September 30, 2013 and December 31, 2012, notes payable included two unsecured promissory notes aggregating $5,997,030 with no stated interest rate or terms of repayment. The Company has accrued interest at 7% per annum on both notes since their inception and includes the notes in current liabilities. | ||||||||
On February 1, 2013, the Company issued a $100,000 75-day unsecured 10% promissory note to an individual investor for funds received. On March 18, 2013, the Company issued a $50,000 60-day unsecured 12% promissory note to the same investor for funds received. The Company issued 2 million common shares to the investor as an inducement for the loans, which were amortized as financing fees. As of September 30, 2013, the Company has not repaid these notes. | ||||||||
On February 2, 2012, the Company closed on a Securities Purchase Agreement with La Jolla Cove Investors, Inc. a California-based institutional investor (the “Investor”) for an aggregate of $5.5 million. The $500,000 initial tranche was funded at the closing in connection with a Convertible Debenture due in February 2015 and an Equity Investment Agreement (the “EIA”). A portion of the Debenture was converted by the Investor into shares of common stock beginning on May 3, 2012. | ||||||||
The Debenture grants the Investor with a right of first refusal on future financings of the Company subject to certain terms and conditions and contains acceleration provisions requiring 120% of the principal amount, accrued and unpaid interest, to become immediately due and payable on certain events of default described therein. | ||||||||
Pursuant to the EIA, the Investor agreed to invest an additional $5.0 million in monthly tranches beginning on May 3, 2012. The Investor also has the right to purchase an additional $5.0 million of the Company’s common stock at an exercise price of $0.21 per share for a period of three years. | ||||||||
The Company incurred customary closing costs including attorney’s fees, commissions and closing costs of $62,027, which are recorded as deferred financing costs to be amortized as additional interest expense on a straight-line basis over the 3-year term of the Debenture and EIA. | ||||||||
On July 25, 2013, the Company filed a lawsuit against the Investor in the United States District Court for the Northern District of California relating to the finance documents entered into by the Company and the Investor in January 2012. In the lawsuit, the Company alleges breach of contract and other causes of action. The Company has reclassified the convertible notes payable from long-term to current notes payable. | ||||||||
DERIVATIVE_LIABILITIES
DERIVATIVE LIABILITIES | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
Derivative Liability [Abstract] | ' | |||||||||||||
DERIVATIVE LIABILITIES | ' | |||||||||||||
NOTE 7. DERIVATIVE LIABILITIES | ||||||||||||||
The Company accounts for derivative instruments at fair value. Gains and losses from changes in the fair value of derivatives are recognized in interest expense. The Company’s derivative instruments consist of stock warrants that contained anti-dilution provisions that were issued with certain debt and equity financings. During the nine months ended September 30, 2013, all financial instruments that gave rise to the derivative liabilities have expired. | ||||||||||||||
Warrants | ||||||||||||||
In the past, the Company entered into financing agreements for convertible promissory notes and stock purchase agreements, which included Class A and Class B warrants. Both Class A and Class B warrants contained anti-dilution rights and are considered to be derivative liabilities under U.S. GAAP. During 2010 and 2011, the Company entered into new stock purchase agreements and issued an aggregate of 9,677,167 warrants under the 2010 and 2011 stock purchase agreements. Warrants issued under the 2010 and 2011 stock purchase agreements have no anti-dilution rights and are not considered to be derivative liabilities. All warrants have 3-year terms and are exercisable for a purchase price of $0.21 per share or, in the case of Class B warrants, $0.315 per share. | ||||||||||||||
The following table summarizes certain information about the Company’s warrants to purchase common stock. | ||||||||||||||
Derivative Liabilities | Weighted | |||||||||||||
Warrants | Average | |||||||||||||
Warrants | Warrants | & Purchase | Exercise | |||||||||||
Class A | Class B | Rights | Price | |||||||||||
Outstanding at December 31, 2012 | 8,327,462 | 8,327,462 | 20,033,021 | $ | 0.234 | |||||||||
Warrants Granted | 0 | 0 | 972,381 | 0.21 | ||||||||||
Warrants Expired | -8,327,462 | -8,327,462 | 0 | 0 | ||||||||||
Outstanding at September 30, 2013 | 0 | 0 | 21,005,402 | $ | 0.21 | |||||||||
There was no intrinsic value for the derivative liabilities relating the Class A and Class B warrants, which all expired by September 30, 2013. There were no changes in the valuation techniques during the nine months ended September 30, 2013. | ||||||||||||||
The warrants outstanding and exercisable at September 30, 2013 and December 31, 2012 had no intrinsic value. All warrants were fully exercisable and there was no unamortized cost to be recognized in future periods. | ||||||||||||||
LITIGATION_AND_CONTINGENCIES
LITIGATION AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2013 | |
Litigation and Contingencies [Abstract] | ' |
LITIGATION AND CONTINGENCIES | ' |
NOTE 8. LITIGATION AND CONTINGENCIES | |
In the ordinary conduct of business, the Company is subject to periodic lawsuits, investigations and litigation claims, which are accounted for where appropriate. Management cannot predict with certainty the ultimate resolution of such lawsuits, investigations and claims asserted against the Company. At September 30, 2013, we had the following material contingencies: | |
Brio Capital | |
Brio Capital, the holder of a warrant, filed an action against us on February 25, 2011 in the New York Supreme Court, County of New York, for the issuance of approximately 6.2 million shares of common stock upon the exercise of certain warrants. The Court granted a non-final Summary Judgment Order on a portion of the action in favor of Brio in December 2011 requiring the Company, among other things, to issue 6.2 million shares of common stock. The Company has issued the shares required by the Court order. We also entered into a settlement agreement to pay $57,661 in legal fees as required by the Court order, which has been satisfied. The Company reached a settlement with Brio resolving all remaining matters. Under the terms of the settlement, the Company is required to issue a number of shares of common stock in twelve (12) monthly installments equal to $31,250 divided by the average of the closing bid prices of our common stock for the last three (3) trading days of the month immediately preceding the month in which the shares are due to be issued. Pursuant to the Court’s Section 3(a) (10) approval, the shares of common stock issued to Brio shall be freely tradeable upon issuance. All shares issued are subject to a leak-out provision contained in the settlement agreement. | |
Tsunami Communications v. GlobeTel | |
On March 3, 2006, Civil Action File No. 06A-02368-5 was filed in Superior Court for Gwinnett County, Georgia by Tsunami Communications and several of its former shareholders. We asserted affirmative defenses and a trial was held in November 2009. By Order of the Court entered on September 2, 2010, an Order was entered against GlobeTel and several other co-defendants for the breach by Sanswire Technologies, Inc. (“ST”) (a then unrelated party) of its asset purchase agreement with the plaintiff Tsunami based on a deemed de facto merger resulting from a subsequent asset purchase agreement between ST and GlobeTel. As damages, we were ordered to issue 530,015 shares of common stock to former shareholders of Tsunami and pay $229,180 to a former Tsunami shareholder with respect to two outstanding promissory notes. Subsequent to the Order, the plaintiffs filed a Motion for Reconsideration asking the Court to both reconsider its decision to deny several of the plaintiffs’ claims and to substantially increase the award of damages and a Claim for Attorney’s Fees, which has been denied by the Court. We have issued the share portion of the Order. We reached a settlement with the plaintiffs resolving the cash portion of the Order. Under the terms of the settlement, we issued 3.75 million shares of common stock and are required to pay them $60,000 over a twelve-month period. | |
The DeCarlo Group | |
A lawsuit was filed by the DeCarlo Group on November 24, 2010 in Miami-Dade County Courthouse for over $400,000 claimed in connection with CFO and accounting services allegedly rendered to the Company. It is our position that the Company was overcharged in connection with the services rendered and that no amounts are due. DeCarlo has now filed a second amended complaint that the Company will respond to and the Company intends to otherwise defend ourselves vigorously in this matter, but the outcome of the action cannot be predicted. | |
Siefert | |
A lawsuit was filed by Thomas Seifert, a former officer and director of the Company, on April 9, 2012 in the Circuit Court of the 17th Judicial Circuit in Broward County for $548,000 and 7.0 million shares of common stock for alleged unpaid compensation. We reached a settlement with the plaintiff resolving this lawsuit, without admitting or denying the allegations. Under the terms of the settlement, we were required to issue him 6.0 million shares of common stock, which shares are subject to a fourteen-month leak-out, and pay him $50,000 over a twelve-month period. The Company entered into a forbearance agreement with Seifert in September 2013. | |
La Jolla Cove Investors, Inc. | |
On July 25, 2013, the Company filed a lawsuit against La Jolla Cove Investors, Inc. in the United States District Court for the Northern District of California relating to the finance documents entered into by the Company and La Jolla in January 2012. In the lawsuit, the Company alleges breach of contract and other causes of action. The Company is seeking injunctive relief in addition to unspecified monetary damages as well as other relief. The Company also filed an Ex Parte Motion for temporary restraining order and order to show cause regarding preliminary injunction. The Company intends to otherwise pursue this matter vigorously, but the outcome of the action cannot be predicted. | |
IRS | |
During 2010 and 2009, we, under our former name Sanswire Corp., incurred and reported to the Internal Revenue Service (“IRS”) payroll tax liabilities (and deposited the appropriate withholding amounts) during the normal course of business at each payroll cycle. The Company has reported its payroll tax liabilities for all the tax periods in 2007 and 2008, however, it failed to deposit the appropriate withholding amounts for those periods. We recognized this issue and, accordingly, contacted the IRS to make arrangements to pay any taxes due. One such matter has been resolved with the IRS, and we currently estimate the amount involved in the second matter to be approximately $200,000. We may be subject to additional penalties and interest from the IRS in connection with these payroll tax matters. We are engaged in discussions and contiune to cooperate with the IRS to resolve this matter. | |
The Company provides indemnification, to the extent permitted by law, to its’ officers, directors, employees and agents for liabilities arising from certain events or occurrences while the officer, director, employee, or agent is or was serving at the Company’s request in such capacity. | |
COMMON_STOCK_TRANSACTIONS
COMMON STOCK TRANSACTIONS | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Common Stock Transactions [Abstract] | ' | ||||||||
COMMON STOCK TRANSACTIONS | ' | ||||||||
NOTE 9. COMMON STOCK TRANSACTIONS | |||||||||
During the nine month period ended September 30, 2013, the Company issued the following shares of Common Stock: | |||||||||
Shares | Consideration | Valuation | |||||||
2,000,000 | Shares issued as inducement for loans | $ | 34,400 | ||||||
6,000,000 | Shares issued for cash | 120,000 | |||||||
14,436,353 | Shares issued for legal settlements | 227,900 | |||||||
11,872,500 | Shares issued for services | 236,250 | |||||||
25,000,000 | Shares issued for LTAS acquisition | 672,500 | |||||||
7,692,308 | Shares issued for accrued salaries | 100,000 | |||||||
4,900,000 | Shares issued for compensation | 13,890 | |||||||
2,933,333 | Shares issued for convertible debt conversion | 76,339 | |||||||
16,000,000 | Shares issued for retention bonuses | 9,312 | |||||||
90,834,494 | $ | 1,490,591 | |||||||
The valuation amounts of the above common stock transactions are based on the amounts reflected in common stock and related additional paid-in capital for each transaction. | |||||||||
SHAREBASED_COMPENSATION
SHARE-BASED COMPENSATION | 9 Months Ended | |||||||||||
Sep. 30, 2013 | ||||||||||||
Share-Based Compensation [Abstract] | ' | |||||||||||
SHARE-BASED COMPENSATION | ' | |||||||||||
NOTE 10. SHARE-BASED COMPENSATION | ||||||||||||
The Company issues stock-based compensation that consists of common stock, restricted stock and stock options to its directors, officers, employees and consultants. All common stock and restricted stock awards are subject to the securities law restrictions of Rule 144 as promulgated under the Securities Act of 1933, as amended, unless covered by a registration statement. | ||||||||||||
Common Stock | ||||||||||||
The Company recognizes the cost of the common stock issued to directors, officers, and employees as compensation expense at the closing market price on the grant date. All common stock awards are fully vested on the date of grant, therefore there is no unrecognized compensation expense associated with these awards. During the nine-months ended September 30, 2013, the Company awarded 900,000 shares for $13,890 for quarterly directors’ fees, including 600,000 shares issued to the former Chairman of the Board of Directors pursuant to a settlement agreement. | ||||||||||||
Restricted Stock | ||||||||||||
Awards of restricted stock are independent of stock option grants and are generally subject to forfeiture if employment terminates prior to vesting. Prior to vesting, ownership of the restricted stock cannot be transferred. The restricted stock has the same voting rights as the common stock. The Company recognizes the grant date fair value of restricted stock awards ratably over the vesting period as compensation expense based upon the stock’s closing market price on the vest date. Restricted stock that vested during the nine-months ended September 30, 2013 totaled $9,312. During the first quarter of 2013, the Company awarded 16 million shares to certain officers and employees as retention bonuses, which cliff vest on February 6, 2014. On July 29, 2013, the Company awarded 4 million shares for $100,000 with a six-month cliff vest in retention bonus. On September 25, 2013, the Company issued 7,692,308 shares in lieu of accrued employee salaries. There is approximately $469,215 in unrecognized compensation relating to unvested restricted stock at September 30, 2013. | ||||||||||||
Stock Options | ||||||||||||
The Company has issued stock options at exercise prices equal to the Company’s common stock market price on the date of grant with contractual terms of three to seven years. Historically, the stock options were fully vested and expensed as compensation on the grant date. During 2010, the Company began issuing stock options with vesting schedules and such stock options are generally subject to forfeiture if employment terminates prior to vesting. During the nine-months ended September 30, 2013, the Company awarded 2 million options that cliff vest on February 6, 2014 in retention bonuses and issued 900,000 fully-vested options totaling $18,913 as directors’ fees. On July 29, 2013, the Company awarded 12 million fully-vested options totaling approximately $285,600 as share-based compensation. On September 25, 2013, the Company issued 40,355,693 fully-vested options totaling approximately $524,624 as an accrued employee salary conversion. Vested options during the nine-month period totaled $849,594. At September 30, 2013, there is approximately $92,315 in unrecognized compensation expense relating to unvested stock options. | ||||||||||||
The Company uses the Black-Scholes option pricing model to estimate the fair value of stock options. The principal assumptions utilized in valuing stock options include the expected stock price volatility based on the most recent historical period equal to the expected life of the option; an estimate of the expected option life based upon historical experience; no expected dividend yield; and the risk-free interest rate based upon on the yields of Treasury constant maturities for the remaining term of the option. | ||||||||||||
The following table summarizes information about stock options outstanding and exercisable at September 30, 2013: | ||||||||||||
Options Outstanding and Exercisable | ||||||||||||
Weighted average | ||||||||||||
remaining | Weighted | |||||||||||
contractual | Average | |||||||||||
Number | terms | Exercise | ||||||||||
Exercise prices | outstanding | (years) | price | |||||||||
$ | 0.013 | 40,355,693 | 6.99 | $ | 0.013 | |||||||
0.015 | 10,120,000 | 6.01 | 0.015 | |||||||||
0.016 | 250,000 | 2.42 | 0.016 | |||||||||
0.021 | 250,000 | 2.62 | 0.021 | |||||||||
0.023 | 22,316,667 | 6.12 | 0.023 | |||||||||
0.024 | 12,000,000 | 6.83 | 0.024 | |||||||||
0.028 | 400,000 | 2.83 | 0.028 | |||||||||
0.045 | 4,444,444 | 0.59 | 0.045 | |||||||||
0.07 | 1,500,000 | 0.36 | 0.07 | |||||||||
0.075 | 10,250,000 | 3.5 | 0.075 | |||||||||
0.08 | 1,500,000 | 0.52 | 0.08 | |||||||||
0.09 | 11,338,889 | 0.3 | 0.09 | |||||||||
0.094 | 1,300,000 | 0.01 | 0.094 | |||||||||
116,025,693 | 5.26 | $ | 0.048 | |||||||||
No options were in-the-money on September 30, 2013. | ||||||||||||
INCOME_TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2013 | |
Income Tax Disclosure [Abstract] | ' |
INCOME TAXES | ' |
NOTE 11. INCOME TAXES | |
The Company has federal and state net operating loss (NOL) carry-forwards, which can be used to offset future earnings. Accordingly, no provision for income taxes is recorded in the condensed consolidated financial statements. A deferred tax asset for the future benefits of net operating losses and other differences is offset by a 100% valuation allowance due to the uncertainty of the Company's ability to utilize the losses. These net operating losses begin to expire in the year 2021. The Company operated in multiple tax jurisdictions within the United States of America. Although management does not believe that the Company is currently under examination in any major tax jurisdiction in which it operates other than the issues with the IRS as described in Note 8, the Company remains subject to examination in all of those tax jurisdictions | |
until the applicable statute of limitations expire. At September 30, 2013, the tax years that remain subject to examination in the Company’s major tax jurisdictions are: United States – Federal and State – 2005 and forward. The Company does not expect to have a material change to unrecognized tax positions within the next twelve months. | |
PER_SHARE_INFORMATION
PER SHARE INFORMATION: | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Earnings Per Share [Abstract] | ' | |||||||
PER SHARE INFORMATION: | ' | |||||||
NOTE 12. PER SHARE INFORMATION: | ||||||||
Basic earnings per share (“Basic EPS”) of common stock is computed by dividing the net loss by the weighted-average number of shares of common stock outstanding. Diluted earnings per share of common stock (“Diluted EPS”) is computed by dividing the net loss by the weighted-average number of shares of common stock, and dilutive common stock equivalents and convertible securities then outstanding. U.S. GAAP requires the presentation of both Basic EPS and Diluted EPS on the face of the Company’s Condensed Consolidated Statements of Operations. There were no dilutive common stock equivalents at September 30, 2013. | ||||||||
Nine Months Ended September 30, | ||||||||
2013 | 2012 | |||||||
Numerator: | ||||||||
Net loss | $ | -2,403,114 | $ | -1,506,757 | ||||
Denominator: | ||||||||
Weighted-average common shares outstanding | 597,936,763 | 402,920,267 | ||||||
Dilutive effect of stock warrants and stock options | 0 | 0 | ||||||
Weighted-average common shares outstanding, assuming dilution | 597,936,763 | 402,920,267 | ||||||
Net loss per share: | ||||||||
Basic and diluted | $ | 0 | $ | 0 | ||||
SUBSEQUENT_EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2013 | |
Subsequent Events [Abstract] | ' |
SUBSEQUENT EVENTS | ' |
NOTE 13. SUBSEQUENT EVENTS | |
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES (Policies) | 9 Months Ended | ||
Sep. 30, 2013 | |||
Summary Of Significant Accounting Principles [Abstract] | ' | ||
DESCRIPTION OF BUSINESS | ' | ||
DESCRIPTION OF BUSINESS | |||
World Surveillance Group Inc. (the “Company”) designs, develops, markets, and sells, autonomous lighter-than-air (LTA) aerostats and unmanned aerial systems (UAS) capable of carrying payloads that provide semi-persistent intelligence, surveillance and reconnaissance (ISR), security and/or wireless communications from air to ground solutions at low and mid altitudes. The Company’s business focuses primarily on the design and development of innovative aerostats and UAS that provide situational awareness and other communications capabilities via the integration of wireless capabilities and customer payloads. The Company’s aerostats and airships, when integrated with cameras, electronics systems and other high technology payloads, are designed for use by government-related and commercial entities that require real-time ISR or communications support for military, homeland defense, border control, drug interdiction, natural disaster relief, maritime and environmental missions. | |||
The Company’s wholly owned subsidiary Global Telesat Corp. (GTC), provides mobile voice and data communications services globally via satellite to the U.S. government, defense industry and commercial users. GTC specializes in services related to the Globalstar satellite constellation, including satellite telecommunications voice airtime, tracking devices and services, and ground station construction. GTC has an e-commerce mobile satellite solutions portal and is an authorized reseller of satellite telecommunications equipment and services offered by other leading satellite network providers such as Inmarsat, Iridium, Globalstar and Thuraya. GTC also has a new subscription based online tracking portal called GTCTrack, designed to attract new satellite and GSM tracking customers by offering an easy-to-use interface and compatibility with a wide range of devices. GTC’s equipment is installed in various ground stations across Africa, Asia, Australia, Europe and South America. | |||
The Company’s wholly owned subsidiary Lighter Than Air Systems Corp. (LTAS), provides critical aerial and land-based surveillance and communications solutions to government and commercial customers. LTAS systems are designed and developed in-house utilizing proprietary technologies and processes that result in compact, rapidly deployable aerostat solutions and mast-based ISR systems. The LTAS systems have been proven to fulfill critical requirements of the military and law enforcement in the U.S. and internationally. | |||
BASIS OF PRESENTATION | ' | ||
BASIS OF PRESENTATION | |||
The accompanying unaudited condensed consolidated financial statements include the accounts of World Surveillance Group Inc. and its subsidiaries (“WSGI” or the “Company”) and have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) for interim financial information and reports and pursuant to the requirements for reporting on Form 10-Q and Regulation S-X for scaled disclosures for smaller reporting companies. Accordingly, they do not include all, or include a condensed version of, the information and footnotes required by U.S. GAAP for complete financial statements. The Company believes, however, that the disclosures are adequate to make the information presented not misleading. Therefore, the Company’s condensed consolidated financial statements reflect all adjustments (consisting solely of normal recurring adjustments), which are, in the opinion of management, necessary for the fair presentation of the consolidated financial position and the consolidated results of operations of the Company for the periods shown. Results shown for interim periods are not necessarily indicative of the results to be obtained for a full fiscal year or for any future period. The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates, judgments and assumptions that affect the amounts reported in the condensed consolidated financial statements. Actual results may differ from management’s estimates. | |||
The consolidated balance sheet information as of December 31, 2012 was derived from the audited consolidated financial statements included in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) for the fiscal year ended December 31, 2012. These interim condensed consolidated financial statements should be read in conjunction with the Company’s most recently audited financial statements and the notes thereto included in such above referenced Annual Report on Form 10-K. | |||
RECLASSIFICATIONS | ' | ||
RECLASSIFICATIONS | |||
Certain 2012 amounts have been reclassified to conform to the 2013 presentation. | |||
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 settlement of liabilities and commitments in the normal course of business. However, as reflected in the accompanying condensed consolidated financial statements, the Company incurred a loss from operations of $1,789,988 for the nine months ended September 30, 2013. The Company also had a working capital deficit of $16,446,126 and total stockholders’ deficit of $13,223,618, as well as an accumulated deficit for $151,398,466 at September 30, 2013. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent upon its ability to raise additional funds either through investments or by generating revenue from the sale of the Company’s products to continue its business operations and implement its strategic plan, which includes, among other things, continued development of its aerostats and UAS, the pursuit or continued development of strategic relationships and expansion of the Company’s subsidiaries’ businesses. The Company’s business plan, which if successfully implemented, will allow it to sell aerostats, UAS and other products for a profit, which in turn will reduce the Company’s dependence on raising additional funds from outside sources. The condensed consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. The Company anticipates a net loss to continue for the next several quarters. | |||
Additional cash will be needed to support our ongoing operations until such time that operations provide sufficient cash flow to cover expenditures. We are currently pursuing both short and long-term financing options from private investors as well as through institutional investors. We are also working to commercialize our aerostats, Argus One airship, and our subsidiaries’ products to generate revenues from customers. We anticipate generating revenues from the sale of our airships in 2014 and are already generating revenue from our aerostats and our subsidiaries’ products. The costs associated with our strategic plan are variable and contingent on our ability to raise capital or generate revenue from customer contracts, but we expect to need funding of approximately $3 million over the next 12 months. We are currently in litigation with La Jolla Cove Investors and do not expect any future funding under those agreements. We continue to have discussions with various entities relating to funding, but there can be no assurance that such funding will be received in the amounts required, on a timely basis, or at all. While we believe we will be able to continue to raise capital from various funding sources in such amounts sufficient to sustain operations at our current levels through the next several quarters, if we are not able to do so and if we are not able to generate sufficient revenue through the sale of our products, we would likely need to modify our strategy or cut back or terminate some of our operations. If we are able to raise additional funds through the issuance of equity securities, substantial dilution to existing shareholders may result. However, if our plans are not achieved, if significant unanticipated damaging events occur, or if we are unable to obtain the necessary additional funding on favorable terms or at all, we will likely have to modify our business plan and reduce, delay or discontinue some or all of our operations to continue as a going concern or seek a buyer for all or a portion of our assets. As of the date hereof, we continue to raise capital to sustain our current operations. | |||
REVENUE RECOGNITION | ' | ||
REVENUE RECOGNITION | |||
The Company recognizes revenue when all four of the following criteria are met: 1) persuasive evidence of an arrangement exists; 2) delivery has occurred and title has transferred or services have been rendered; 3) our price to the buyer is fixed or determinable; and 4) collectability is reasonably assured. The Company records unearned contract revenues and subscription fees as deferred revenues and their associated costs of sales as prepaid expenses. Deferred revenues from subscription fees and their related costs are amortized pro-ratable over the subscription term. Deferred revenues from contracts and their related costs are recognized upon completion and fulfillment of the contractual obligation using the completed contract method. | |||
INCOME TAXES | ' | ||
INCOME TAXES | |||
The Company accounts for income taxes using the asset and liability approach. Under this approach, deferred income taxes are recognized based on the tax effects of temporary differences between the financial statement and tax bases of assets and liabilities, as measured by current enacted tax rates. Valuation allowances are recorded to reduce the deferred tax assets to an amount that will more likely than not be realized. | |||
U.S. GAAP requires that, in applying the liability method, the financial statement effects of an uncertain tax position be recognized based on the outcome that is more likely than not to occur. Under this criterion the most likely resolution of an uncertain tax position should be analyzed based on technical merits and on the outcome that will likely be sustained under examination. There were no adjustments related to uncertain tax positions recognized during the nine months ended September 30, 2013 and 2012, respectively. | |||
FAIR VALUE MEASUREMENTS | ' | ||
FAIR VALUE MEASUREMENTS | |||
U.S. GAAP includes a framework for measuring fair value, which also addresses disclosure requirements for fair value measurements. Fair value is the price that would be received upon sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date and in the principal or most advantageous market for that asset or liability. The fair value, in this context, should be calculated based on assumptions that market participants would use in pricing the asset or liability, not on assumptions specific to the entity. In addition, the fair value of liabilities should include consideration of non-performance risk, including the Company’s own credit risk. | |||
Under the measurement framework, a fair valuation hierarchy for disclosure of the inputs to valuation used to measure fair value has been established. This hierarchy prioritizes the inputs into three broad levels that reflect the degree of subjectivity necessary to determine fair value measurements, as follows. Level 1 inputs are based on unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 inputs are based on 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 asset or liability. Level 3 inputs are unobservable inputs and reflect the Company’s estimates of assumptions that market participants would use to measure assets and liabilities at fair value. The fair values are therefore determined using model-based techniques that include option pricing models and discounted cash flow models. 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. | |||
DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS | ' | ||
DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS | |||
The Company’s financial instruments include cash, accounts payable, notes payable and derivative instruments. The carrying values for the current financial assets and liabilities approximate fair value due to their short maturity. The fair values of the Company’s derivative instruments are recorded in the condensed consolidated balance sheets. | |||
USE OF ESTIMATES | ' | ||
USE OF ESTIMATES | |||
The process of preparing financial statements in conformity with U.S. GAAP requires the use of estimates, judgments and assumptions regarding certain types of assets, liabilities, revenues, and expenses. These estimates, judgments and assumptions are evaluated on an ongoing basis. The Company bases its estimates on historical experience and on various other assumptions that it believes are reasonable at that time, 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. Such estimates primarily relate to unsettled transactions and events as of the date of the financial statements. Accordingly, upon settlement, actual results may differ from the Company’s estimated amounts. | |||
BASIC AND DILUTED NET LOSS PER COMMON SHARE | ' | ||
BASIC AND DILUTED NET LOSS PER COMMON SHARE | |||
Basic and diluted net loss per common share has been computed by dividing the net loss by the weighted average number of shares of common stock outstanding during each period. Whenever losses are reported, the weighted average number of common shares outstanding excludes common stock equivalents because their inclusion would result in a diluted loss per share less than the basic loss per share and therefore would be anti-dilutive. Whenever net income is reported, the weighted average number of common shares outstanding will include common stock equivalents that are in-the-money. If all outstanding options, warrants and convertible shares were converted or exercised at September 30, 2013, the shares outstanding would be 782,633,119. | |||
PROPERTY AND EQUIPMENT | ' | ||
PROPERTY AND EQUIPMENT | |||
Property and equipment are carried at cost less accumulated depreciation. Depreciation is based on the estimated service lives of the depreciable assets and is calculated using the straight-line method. Expenditures that increase the value or productive capacity of assets are capitalized. Fully depreciated assets are retained in property and accumulated depreciation accounts until they are removed from service. When property and equipment are retired, sold or otherwise disposed of, the asset’s carrying amount and related accumulated depreciation are removed from the accounts and any gain or loss is included in operations. Repairs and maintenance are expensed as incurred. | |||
The estimated useful lives of property and equipment are generally as follows: | |||
Appliques | 15 – 25 years | ||
Machinery and equipment | 3 – 12 years | ||
Office furniture and fixtures | 3 – 10 years | ||
Computer hardware and software | 3 – 7 years | ||
LONG LIVED ASSETS | ' | ||
LONG LIVED ASSETS | |||
The Company evaluates the fair value of long-lived assets on an annual basis or whenever events or changes in circumstances indicate that its carrying amounts may not be recoverable. Accordingly, any impairment of value is recognized when the carrying amount of a long-lived asset exceeds its fair value. The Company’s evaluations have not indicated any impairment of fair values. | |||
DERIVATIVE FINANCIAL INSTRUMENTS | ' | ||
DERIVATIVE FINANCIAL INSTRUMENTS | |||
Derivative liabilities primarily relate to warrants to purchase common stock of the Company issued in conjunction with certain debt and equity financings. Each reporting period the Company determines the fair value of the stock warrants using the Black-Scholes option pricing model at the balance sheet date. Changes in the fair value of the stock warrants are recognized each period in current earnings. | |||
SHARE-BASED COMPENSATION | ' | ||
SHARE-BASED COMPENSATION | |||
The Company offers share-based compensation programs to its officers, directors and employees that consist of employee stock options, common stock and restricted stock awards. Common stock and restricted stock awards are issued at the closing price of the Company’s common stock on the date of grant. The Company recognizes compensation expense ratably over the vesting periods for restricted stock awards using the fair value of the stock on the vest date. The Black-Scholes option pricing model is used to value stock options, and compensation expense is recognized ratably over the requisite service period. Stock options typically have contractual terms of three to seven years. Share-based compensation for employees and non-employees is reflected in the appropriate functional expense category, principally the general administrative and research and development categories. Share-based compensation and vested options incurred during the nine months ended September 30, 2013 and 2012 was $972,796 and $1,283,778, respectively. | |||
SUMMARY_OF_SIGNIFICANT_ACCOUNT2
SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES (Tables) | 9 Months Ended | ||
Sep. 30, 2013 | |||
Summary Of Significant Accounting Principles [Abstract] | ' | ||
Estimated Useful Lives of Property and Equipment | ' | ||
The estimated useful lives of property and equipment are generally as follows: | |||
Appliques | 15 – 25 years | ||
Machinery and equipment | 3 – 12 years | ||
Office furniture and fixtures | 3 – 10 years | ||
Computer hardware and software | 3 – 7 years | ||
ACQUISITIONS_Tables
ACQUISITIONS (Tables) | 9 Months Ended | ||||||||||
Sep. 30, 2013 | |||||||||||
Business Combination, Description [Abstract] | ' | ||||||||||
Summary of Original and Revised Allocation of Global Telesat Corp Acquisition Purchase Price | ' | ||||||||||
The following table summarizes the original allocation of the LTAS acquisition purchase price, which has been accounted at the fair values of the assets acquired and liabilities assumed under the acquisition method of accounting: | |||||||||||
Original | Allocation | Revised | |||||||||
Allocation | Adjustment | Allocation | |||||||||
Current assets | $ | 703,220 | $ | 7,195 | $ | 710,415 | |||||
Property and equipment | 1,357 | 2,556 | 3,913 | ||||||||
Goodwill | 479,585 | 391,671 | 871,256 | ||||||||
Due to selling shareholder | 0 | -413,432 | -413,432 | ||||||||
Current liabilities assumed | -261,662 | 12,010 | -249,652 | ||||||||
Total Purchase Price | $ | 922,500 | $ | 0 | $ | 922,500 | |||||
PROPERTY_AND_EQUIPMENT_Tables
PROPERTY AND EQUIPMENT (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Property, Plant and Equipment [Abstract] | ' | |||||||
Property and Equipment | ' | |||||||
Property and equipment consisted of the following: | ||||||||
September 30, | ||||||||
2013 | December 31, | |||||||
(Unaudited) | 2012 | |||||||
Appliques | $ | 2,755,732 | $ | 2,755,732 | ||||
Office furniture and fixtures | 13,465 | 6,904 | ||||||
2,769,197 | 2,762,636 | |||||||
Less: accumulated depreciation | -450,681 | -309,670 | ||||||
$ | 2,318,516 | $ | 2,452,966 | |||||
OTHER_ACCRUED_LIABILITIES_Tabl
OTHER ACCRUED LIABILITIES (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Other Accrued Liabilities [Abstract] | ' | |||||||
Accrued Liabilities | ' | |||||||
Accrued liabilities consisted of the following: | ||||||||
September 30, | ||||||||
2013 | December 31, | |||||||
(Unaudited) | 2012 | |||||||
Payroll liabilities | $ | 1,667,280 | $ | 1,494,883 | ||||
Professional fees | 10,000 | 10,000 | ||||||
Accrued legal claims payable | 475,540 | 334,540 | ||||||
Accrued cash true-up from conversion | 353,873 | 176,831 | ||||||
Accrued interest on debenture | 24,740 | 18,243 | ||||||
GTC acquisition payable | 75,000 | 75,000 | ||||||
Due to LTAS selling shareholder | 413,432 | 0 | ||||||
LTAS acquisition payable | 140,000 | 0 | ||||||
Other | 40,943 | 22,588 | ||||||
OTHER ACCRUED LIABILITIES | $ | 3,200,808 | $ | 2,132,085 | ||||
NOTES_PAYABLE_Tables
NOTES PAYABLE (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Notes Payable [Abstract] | ' | |||||||
Notes Payable | ' | |||||||
Notes payable consisted of the following: | ||||||||
September 30, | ||||||||
2013 | December 31, | |||||||
(Unaudited) | 2012 | |||||||
Unsecured promissory notes | $ | 5,997,030 | $ | 5,997,030 | ||||
Unsecured short-term promissory notes | 150,000 | 0 | ||||||
Convertible debenture | 267,000 | 287,000 | ||||||
Accrued interest | 2,977,499 | 2,654,350 | ||||||
NOTES PAYABLE | $ | 9,391,529 | $ | 8,938,380 | ||||
DERIVATIVE_LIABILITIES_Tables
DERIVATIVE LIABILITIES (Tables) | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
Derivative Liability [Abstract] | ' | |||||||||||||
Warrant to Purchase Common Stock | ' | |||||||||||||
The following table summarizes certain information about the Company’s warrants to purchase common stock. | ||||||||||||||
Derivative Liabilities | Weighted | |||||||||||||
Warrants | Average | |||||||||||||
Warrants | Warrants | & Purchase | Exercise | |||||||||||
Class A | Class B | Rights | Price | |||||||||||
Outstanding at December 31, 2012 | 8,327,462 | 8,327,462 | 20,033,021 | $ | 0.234 | |||||||||
Warrants Granted | 0 | 0 | 972,381 | 0.21 | ||||||||||
Warrants Expired | -8,327,462 | -8,327,462 | 0 | 0 | ||||||||||
Outstanding at September 30, 2013 | 0 | 0 | 21,005,402 | $ | 0.21 | |||||||||
COMMON_STOCK_TRANSACTIONS_Tabl
COMMON STOCK TRANSACTIONS (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Common Stock Transactions [Abstract] | ' | ||||||||
Common Stock Shares Issued | ' | ||||||||
During the nine month period ended September 30, 2013, the Company issued the following shares of Common Stock: | |||||||||
Shares | Consideration | Valuation | |||||||
2,000,000 | Shares issued as inducement for loans | $ | 34,400 | ||||||
6,000,000 | Shares issued for cash | 120,000 | |||||||
14,436,353 | Shares issued for legal settlements | 227,900 | |||||||
11,872,500 | Shares issued for services | 236,250 | |||||||
25,000,000 | Shares issued for LTAS acquisition | 672,500 | |||||||
7,692,308 | Shares issued for accrued salaries | 100,000 | |||||||
4,900,000 | Shares issued for compensation | 13,890 | |||||||
2,933,333 | Shares issued for convertible debt conversion | 76,339 | |||||||
16,000,000 | Shares issued for retention bonuses | 9,312 | |||||||
90,834,494 | $ | 1,490,591 | |||||||
SHAREBASED_COMPENSATION_Tables
SHARE-BASED COMPENSATION (Tables) | 9 Months Ended | |||||||||||
Sep. 30, 2013 | ||||||||||||
Share-Based Compensation [Abstract] | ' | |||||||||||
Stock Options Outstanding and Exercisable | ' | |||||||||||
The following table summarizes information about stock options outstanding and exercisable at September 30, 2013: | ||||||||||||
Options Outstanding and Exercisable | ||||||||||||
Weighted average | ||||||||||||
remaining | Weighted | |||||||||||
contractual | Average | |||||||||||
Number | terms | Exercise | ||||||||||
Exercise prices | outstanding | (years) | price | |||||||||
$ | 0.013 | 40,355,693 | 6.99 | $ | 0.013 | |||||||
0.015 | 10,120,000 | 6.01 | 0.015 | |||||||||
0.016 | 250,000 | 2.42 | 0.016 | |||||||||
0.021 | 250,000 | 2.62 | 0.021 | |||||||||
0.023 | 22,316,667 | 6.12 | 0.023 | |||||||||
0.024 | 12,000,000 | 6.83 | 0.024 | |||||||||
0.028 | 400,000 | 2.83 | 0.028 | |||||||||
0.045 | 4,444,444 | 0.59 | 0.045 | |||||||||
0.07 | 1,500,000 | 0.36 | 0.07 | |||||||||
0.075 | 10,250,000 | 3.5 | 0.075 | |||||||||
0.08 | 1,500,000 | 0.52 | 0.08 | |||||||||
0.09 | 11,338,889 | 0.3 | 0.09 | |||||||||
0.094 | 1,300,000 | 0.01 | 0.094 | |||||||||
116,025,693 | 5.26 | $ | 0.048 | |||||||||
PER_SHARE_INFORMATION_Tables
PER SHARE INFORMATION: (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Earnings Per Share [Abstract] | ' | |||||||
Computation of Earnings Per Share Basic and Diluted | ' | |||||||
There were no dilutive common stock equivalents at September 30, 2013. | ||||||||
Nine Months Ended September 30, | ||||||||
2013 | 2012 | |||||||
Numerator: | ||||||||
Net loss | $ | -2,403,114 | $ | -1,506,757 | ||||
Denominator: | ||||||||
Weighted-average common shares outstanding | 597,936,763 | 402,920,267 | ||||||
Dilutive effect of stock warrants and stock options | 0 | 0 | ||||||
Weighted-average common shares outstanding, assuming dilution | 597,936,763 | 402,920,267 | ||||||
Net loss per share: | ||||||||
Basic and diluted | $ | 0 | $ | 0 | ||||
Recovered_Sheet1
Summary of Significant Accounting Principles - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | |
Summary Of Significant Accounting Policies [Line Items] | ' | ' | ' | ' | ' |
Loss from operations | ($934,045) | ($742,066) | ($1,789,988) | ($3,244,030) | ' |
Working capital deficit | ' | ' | 16,446,126 | ' | ' |
Total stockholders' deficit | 13,223,618 | ' | 13,223,618 | ' | 13,160,689 |
Accumulated deficit | -151,398,466 | ' | -151,398,466 | ' | -148,995,352 |
Additional capital | 3,000,000 | ' | 3,000,000 | ' | ' |
Shares outstanding if all potential number of shares were exercised | ' | ' | 782,633,119 | ' | ' |
Share based compensation expense | ' | ' | $972,796 | $1,283,778 | ' |
Estimated_Useful_Lives_of_Prop
Estimated Useful Lives of Property and Equipment (Detail) | 9 Months Ended |
Sep. 30, 2013 | |
Appliques | Minimum | ' |
Property, Plant and Equipment [Line Items] | ' |
Property and equipment, estimated useful life | '15 years |
Appliques | Maximum | ' |
Property, Plant and Equipment [Line Items] | ' |
Property and equipment, estimated useful life | '25 years |
Machinery and equipment | Minimum | ' |
Property, Plant and Equipment [Line Items] | ' |
Property and equipment, estimated useful life | '3 years |
Machinery and equipment | Maximum | ' |
Property, Plant and Equipment [Line Items] | ' |
Property and equipment, estimated useful life | '12 years |
Office furniture and fixtures | Minimum | ' |
Property, Plant and Equipment [Line Items] | ' |
Property and equipment, estimated useful life | '3 years |
Office furniture and fixtures | Maximum | ' |
Property, Plant and Equipment [Line Items] | ' |
Property and equipment, estimated useful life | '10 years |
Computer hardware and software | Minimum | ' |
Property, Plant and Equipment [Line Items] | ' |
Property and equipment, estimated useful life | '3 years |
Computer hardware and software | Maximum | ' |
Property, Plant and Equipment [Line Items] | ' |
Property and equipment, estimated useful life | '7 years |
Acquisitions_Additional_Inform
Acquisitions - Additional Information (Detail) (USD $) | 1 Months Ended | 9 Months Ended |
Mar. 28, 2013 | Sep. 30, 2013 | |
Business Acquisition [Line Items] | ' | ' |
Percentage of equity interest acquired of Lighter Than Air Systems Corp. | 100.00% | ' |
Lighter Than Air Systems Corp | ' | ' |
Business Acquisition [Line Items] | ' | ' |
Business acquisition, contingent consideration, potential cash payment | $250,000 | ' |
Business acquisition earn out equal revenue gross | 25,000,000 | ' |
Shares placed in escrow for one year to satisfy possible indemnification claims | 7,500,000 | ' |
Number of shares issued in connection with acquisition | 25,000,000 | ' |
Business acquisition, description of acquired entity | ' | '(i) a WSGI bankruptcy event, or (ii) a decrease in the daily volume of WSGIs common stock to below 50,000 shares for 30 consecutive days, occurring within 18 months of the Closing at a purchase price equal to the fair market value of the LTAS stock at the time of such triggering event, as determined by an independent valuation firm. |
Market price per share on acquisition | $0.03 | ' |
Summary_of_Original_Allocation
Summary of Original Allocation of Lighter Than Air Systems Corp Acquisition Purchase Price (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Mar. 28, 2013 | Mar. 28, 2013 | Mar. 28, 2013 |
Original Allocation | Allocation Adjustment | Revised Allocation | |||
Business Acquisition [Line Items] | ' | ' | ' | ' | ' |
Current assets | ' | ' | $703,220 | $7,195 | $710,415 |
Property and equipment | ' | ' | 1,357 | 2,556 | 3,913 |
Goodwill | 871,256 | 0 | 479,585 | 391,671 | 871,256 |
Due to selling shareholder | -413,432 | 0 | 0 | -413,432 | -413,432 |
Current liabilities assumed | ' | ' | -261,662 | 12,010 | -249,652 |
Total Purchase Price | ' | ' | $922,500 | $0 | $922,500 |
Related_Party_Transactions_Add
Related Party Transactions - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | |
Related Party Transaction [Line Items] | ' | ' | ' |
Accounts receivable from related party | $20,359 | $20,359 | $48,220 |
Revenue from related parties | $95,641 | $391,646 | ' |
Revenue from related parties percentage | 47.00% | 33.00% | ' |
Percentage of handling fees | ' | ' | 10.00% |
Property_and_Equipment_Detail
Property and Equipment (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Property, Plant and Equipment [Line Items] | ' | ' |
Property and equipment, gross | $2,769,197 | $2,762,636 |
Less: accumulated depreciation | -450,681 | -355,420 |
Property and equipment, net | 2,318,516 | 2,452,966 |
Appliques | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property and equipment, gross | 2,755,732 | 2,755,732 |
Office furniture and fixtures | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property and equipment, gross | $13,465 | $6,904 |
Accrued_liabilities_Detail
Accrued liabilities (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Schedule of Other Liabilities [Line Items] | ' | ' |
Payroll liabilities | $1,667,280 | $1,494,883 |
Professional fees | 10,000 | 10,000 |
Accrued legal claims payable | 475,540 | 334,540 |
Accrued cash true-up from conversion | 353,873 | 176,831 |
Accrued interest on debenture | 24,740 | 18,243 |
GTC acquisition payable | 75,000 | 75,000 |
Due to LTAS selling shareholder | 413,432 | 0 |
LTAS acquisition payable | 140,000 | 0 |
Other | 40,943 | 22,588 |
OTHER ACCRUED LIABILITIES | $3,200,808 | $2,132,085 |
Notes_Payable_Detail
Notes Payable (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Debt Instrument [Line Items] | ' | ' |
Unsecured promissory notes | $5,997,030 | $5,997,030 |
Unsecured short-term promissory notes | 150,000 | 0 |
Convertible debenture | 267,000 | 287,000 |
Accrued interest | 2,977,499 | 2,654,350 |
NOTES PAYABLE | $9,391,529 | $8,938,380 |
Notes_Payable_Additional_Infor
Notes Payable - Additional Information (Detail) (USD $) | 9 Months Ended | 9 Months Ended | 9 Months Ended | 12 Months Ended | 1 Months Ended | |||
Share data in Millions, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Feb. 01, 2013 | Mar. 18, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Feb. 02, 2012 |
Individual Investor | Short Term Note One | Short Term Note Two | Unsecured Debt | Unsecured Debt | Note Purchase Agreement | |||
Individual Investor | Individual Investor | |||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Unsecured promissory notes | $5,997,030 | $5,997,030 | ' | ' | ' | $5,997,030 | $5,997,030 | ' |
Number of promissory notes | ' | ' | ' | ' | ' | 2 | 2 | ' |
Promissory note interest rate per annum | ' | ' | ' | ' | ' | 7.00% | 7.00% | ' |
Notes payable | 9,391,529 | 8,938,380 | ' | 100,000 | 50,000 | ' | ' | ' |
Stated interest rates | ' | ' | ' | 10.00% | 12.00% | ' | ' | ' |
Number of common shares issued | ' | ' | 2 | ' | ' | ' | ' | ' |
Securities purchase agreement, borrowing capacity | 5,000,000 | ' | ' | ' | ' | ' | ' | 5,500,000 |
Proceeds from notes payable | ' | ' | ' | ' | ' | ' | ' | 500,000 |
Debt acceleration provision | 'The Debenture grants the Investor with a right of first refusal on future financings of the Company subject to certain terms and conditions and contains acceleration provisions requiring 120% of the principal amount, accrued and unpaid interest, to become immediately due and payable on certain events of default described therein. | ' | ' | ' | ' | ' | ' | ' |
Investor right to purchase additional common stock | 5,000,000 | ' | ' | ' | ' | ' | ' | ' |
Exercise price | $0.21 | ' | ' | ' | ' | ' | ' | ' |
Deferred financing costs | $62,027 | ' | ' | ' | ' | ' | ' | ' |
Deferred financing cost amortization period | '3 years | ' | ' | ' | ' | ' | ' | ' |
Derivative_Liabilities_Additio
Derivative Liabilities - Additional Information (Detail) (USD $) | 9 Months Ended | |
Sep. 30, 2013 | Dec. 31, 2012 | |
Class of Warrant or Right [Line Items] | ' | ' |
Warrants Granted | 9,677,167 | ' |
Warrant and purchase rights term | '3 years | ' |
Warrant exercise price | 0.21 | ' |
Aggregate intrinsic value of warrants outstanding and exercisable | $0 | $0 |
Warrants expiration date | 30-Sep-13 | ' |
Class A Warrants | ' | ' |
Class of Warrant or Right [Line Items] | ' | ' |
Derivative liabilities | 0 | ' |
Class B Warrants | ' | ' |
Class of Warrant or Right [Line Items] | ' | ' |
Warrant exercise price | 0.315 | ' |
Derivative liabilities | $0 | ' |
Warrants_to_Purchase_Common_St
Warrants to Purchase Common Stock (Detail) (USD $) | 9 Months Ended |
Sep. 30, 2013 | |
Class of Warrant or Right Outstanding, Weighted Average Exercise Price [Roll Forward ] | ' |
Outstanding at December 31, 2012 | $0.23 |
Warrants Granted | $0.21 |
Warrants Expired | $0 |
Outstanding at September 30, 2013 | $0.21 |
Warrants & Purchase Rights | ' |
Class of Warrant or Right Outstanding [Roll Forward ] | ' |
Outstanding at December 31, 2012 | 20,033,021 |
Warrants Granted | 972,381 |
Warrants Expired | 0 |
Outstanding at September 30, 2013 | 21,005,402 |
Derivative Liabilities | Warrants Class A | ' |
Class of Warrant or Right Outstanding [Roll Forward ] | ' |
Outstanding at December 31, 2012 | 8,327,462 |
Warrants Granted | 0 |
Warrants Expired | -8,327,462 |
Outstanding at September 30, 2013 | 0 |
Derivative Liabilities | Warrants Class B | ' |
Class of Warrant or Right Outstanding [Roll Forward ] | ' |
Outstanding at December 31, 2012 | 8,327,462 |
Warrants Granted | 0 |
Warrants Expired | -8,327,462 |
Outstanding at September 30, 2013 | 0 |
Litigation_and_Contingencies_A
Litigation and Contingencies - Additional Information (Detail) (USD $) | Sep. 30, 2013 | Apr. 09, 2012 | Dec. 31, 2012 | Dec. 31, 2011 | Feb. 25, 2011 | Sep. 02, 2010 | Dec. 31, 2012 | Nov. 24, 2010 | Dec. 31, 2012 |
Siegel | Siegel | Brio Capital | Brio Capital | Tsunami Communications v. GlobeTel | Tsunami Communications v. GlobeTel | The DeCarlo Group | GlobeTel Wireless Europe GmbH | ||
Loss Contingencies [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shares issued for legal settlement (in shares) | ' | ' | ' | 6,200,000 | 6,200,000 | ' | ' | ' | ' |
Common stock issued upon court order | ' | ' | ' | ' | ' | 530,015 | ' | ' | ' |
Damages sought by plaintiff, value | ' | $548,000 | ' | ' | ' | ' | ' | $400,000 | ' |
Damages sought by plaintiff, shares of common stock | ' | 7,000,000 | ' | ' | ' | ' | ' | ' | ' |
Required to issue common stock | ' | ' | 6,000,000 | ' | ' | ' | ' | ' | ' |
Additional loss contingency settlement agreement consideration | ' | ' | 50,000 | ' | ' | ' | ' | ' | ' |
Expected payment for settlement of unpaid taxes with IRS | 200,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Litigation Settlement Monthly | ' | ' | ' | ' | 31,250 | ' | ' | ' | ' |
Settlement agreement consideration | ' | ' | ' | $57,661 | ' | $229,180 | $60,000 | ' | $3,750,000 |
Company_Issued_Shares_of_Commo
Company Issued Shares of Common Stock (Detail) (USD $) | 9 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Class of Stock [Line Items] | ' | ' |
Shares issued as inducement for loans | $34,400 | $0 |
Shares issued for cash | 120,000 | ' |
Shares issued for services | 236,250 | 274,979 |
Shares issued for LTAS acquisition | 672,500 | 0 |
Shares issued for accrued salaries | 100,000 | ' |
Shares issued for compensation | 13,890 | ' |
Shares issued for convertible debt conversion | 76,339 | ' |
COMMON STOCK | ' | ' |
Class of Stock [Line Items] | ' | ' |
Shares issued as inducement for loans (in shares) | 2,000,000 | ' |
Shares issued as inducement for loans | 20 | ' |
Shares issued for cash (in shares) | 6,000,000 | ' |
Shares issued for cash | 60 | ' |
Shares issued for legal settlements (in shares) | 14,436,353 | ' |
Shares issued for services (in shares) | 11,872,500 | ' |
Shares issued for services | 119 | ' |
Shares issued for LTAS acquisition (in shares) | 25,000,000 | ' |
Shares issued for LTAS acquisition | 250 | ' |
Shares issued for accrued salaries (in shares) | 7,692,308 | ' |
Shares issued for accrued salaries | 77 | ' |
Shares issued for compensation (in shares) | 4,900,000 | ' |
Shares issued for compensation | 49 | ' |
Shares issued for convertible debt conversion (in shares) | 2,933,333 | ' |
Shares issued for convertible debt conversion | 29 | ' |
Shares issued for retention bonuses (in shares) | 16,000,000 | ' |
Stock issued during period (in shares) | 90,834,494 | ' |
COMMON STOCK | Related Additional Paid In Capital | ' | ' |
Class of Stock [Line Items] | ' | ' |
Shares issued as inducement for loans | 34,400 | ' |
Shares issued for cash | 120,000 | ' |
Shares issued for legal settlements | 227,900 | ' |
Shares issued for services | 236,250 | ' |
Shares issued for LTAS acquisition | 672,500 | ' |
Shares issued for accrued salaries | 100,000 | ' |
Shares issued for compensation | 13,890 | ' |
Shares issued for convertible debt conversion | 76,339 | ' |
Shares issued for retention bonuses | 9,312 | ' |
Stock issued during period | $1,490,591 | ' |
ShareBased_Compensation_Additi
Share-Based Compensation - Additional Information (Detail) (USD $) | 9 Months Ended | 1 Months Ended | 3 Months Ended | 1 Months Ended | 9 Months Ended | 1 Months Ended | 9 Months Ended | |
Sep. 30, 2013 | Jul. 29, 2013 | Mar. 31, 2013 | Jul. 29, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 25, 2013 | Sep. 30, 2013 | |
Restricted Stock | Restricted Stock | Stock Options | Stock Options | Director Fees | Accrued Salaries | Board of Directors Chairman | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Common shares awarded | ' | ' | ' | ' | ' | 900,000 | ' | 600,000 |
Common shares awarded amount | $100,000 | ' | ' | ' | ' | $13,890 | ' | ' |
Performance based restricted stock vested | 9,312 | 100,000 | ' | ' | ' | ' | ' | ' |
Unrecognized compensation relating to performance-based restricted stock | 469,215 | ' | ' | ' | ' | ' | ' | ' |
Unrecognized compensation expense related to unvested stock options | ' | ' | ' | ' | 92,315 | ' | ' | ' |
Share based compensation arrangement by share based payment award options cliff vesting | ' | 4,000,000 | 16,000,000 | ' | 2,000,000 | ' | ' | ' |
Share based compensation arrangement by share based payment award options vesting period | ' | ' | 6-Feb-14 | ' | 6-Feb-14 | ' | ' | ' |
Fair value of restricted stock issued during period shares for retention bonuses | ' | ' | ' | ' | 900,000 | ' | ' | ' |
Directors fees | ' | ' | ' | ' | 18,913 | ' | ' | ' |
Share based compensation arrangement by share based payment award options vested in period | ' | ' | ' | $285,600 | $849,594 | ' | $524,624 | ' |
Options in-the-money | 116,025,693 | ' | ' | ' | 0 | ' | ' | ' |
Stock issued during period, shares, restricted stock award, gross | ' | ' | ' | ' | ' | ' | 7,692,308 | ' |
Share based compensation arrangement by share based payment award shares options vested in period | ' | ' | ' | 12,000,000 | ' | ' | 40,355,693 | ' |
Summary_of_Stock_Options_Outst
Summary of Stock Options Outstanding and Exercisable (Detail) (USD $) | 9 Months Ended |
Sep. 30, 2013 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Options exercisable at end of year, Shares | 116,025,693 |
Options Outstanding and Exercisable, Weighted average remaining contractual terms (years) | '5 years 3 months 4 days |
Options Outstanding and Exercisable, weighted Average Exercise price | $0.05 |
Exercise Price .013 | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Options Outstanding and Exercisable ,Exercise prices | $0.01 |
Options exercisable at end of year, Shares | 40,355,693 |
Options Outstanding and Exercisable, Weighted average remaining contractual terms (years) | '6 years 11 months 26 days |
Options Outstanding and Exercisable, weighted Average Exercise price | $0.01 |
Exercise Price .015 | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Options Outstanding and Exercisable ,Exercise prices | $0.02 |
Options exercisable at end of year, Shares | 10,120,000 |
Options Outstanding and Exercisable, Weighted average remaining contractual terms (years) | '6 years 4 days |
Options Outstanding and Exercisable, weighted Average Exercise price | $0.02 |
Exercise Price .016 | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Options Outstanding and Exercisable ,Exercise prices | $0.02 |
Options exercisable at end of year, Shares | 250,000 |
Options Outstanding and Exercisable, Weighted average remaining contractual terms (years) | '2 years 5 months 1 day |
Options Outstanding and Exercisable, weighted Average Exercise price | $0.02 |
Exercise Price .021 | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Options Outstanding and Exercisable ,Exercise prices | $0.02 |
Options exercisable at end of year, Shares | 250,000 |
Options Outstanding and Exercisable, Weighted average remaining contractual terms (years) | '2 years 7 months 13 days |
Options Outstanding and Exercisable, weighted Average Exercise price | $0.02 |
Exercise Price .023 | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Options Outstanding and Exercisable ,Exercise prices | $0.02 |
Options exercisable at end of year, Shares | 22,316,667 |
Options Outstanding and Exercisable, Weighted average remaining contractual terms (years) | '6 years 1 month 13 days |
Options Outstanding and Exercisable, weighted Average Exercise price | $0.02 |
Exercise Price .024 | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Options Outstanding and Exercisable ,Exercise prices | $0.02 |
Options exercisable at end of year, Shares | 12,000,000 |
Options Outstanding and Exercisable, Weighted average remaining contractual terms (years) | '6 years 9 months 29 days |
Options Outstanding and Exercisable, weighted Average Exercise price | $0.02 |
Exercise Price .028 | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Options Outstanding and Exercisable ,Exercise prices | $0.03 |
Options exercisable at end of year, Shares | 400,000 |
Options Outstanding and Exercisable, Weighted average remaining contractual terms (years) | '2 years 9 months 29 days |
Options Outstanding and Exercisable, weighted Average Exercise price | $0.03 |
Exercise Price .045 | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Options Outstanding and Exercisable ,Exercise prices | $0.05 |
Options exercisable at end of year, Shares | 4,444,444 |
Options Outstanding and Exercisable, Weighted average remaining contractual terms (years) | '7 months 2 days |
Options Outstanding and Exercisable, weighted Average Exercise price | $0.05 |
Exercise Price .070 | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Options Outstanding and Exercisable ,Exercise prices | $0.07 |
Options exercisable at end of year, Shares | 1,500,000 |
Options Outstanding and Exercisable, Weighted average remaining contractual terms (years) | '4 months 10 days |
Options Outstanding and Exercisable, weighted Average Exercise price | $0.07 |
Exercise Price .075 | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Options Outstanding and Exercisable ,Exercise prices | $0.08 |
Options exercisable at end of year, Shares | 10,250,000 |
Options Outstanding and Exercisable, Weighted average remaining contractual terms (years) | '3 years 6 months |
Options Outstanding and Exercisable, weighted Average Exercise price | $0.08 |
Exercise Price .080 | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Options Outstanding and Exercisable ,Exercise prices | $0.08 |
Options exercisable at end of year, Shares | 1,500,000 |
Options Outstanding and Exercisable, Weighted average remaining contractual terms (years) | '6 months 7 days |
Options Outstanding and Exercisable, weighted Average Exercise price | $0.08 |
Exercise Price .090 | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Options Outstanding and Exercisable ,Exercise prices | $0.09 |
Options exercisable at end of year, Shares | 11,338,889 |
Options Outstanding and Exercisable, Weighted average remaining contractual terms (years) | '3 months 18 days |
Options Outstanding and Exercisable, weighted Average Exercise price | $0.09 |
Exercise Price .094 | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Options Outstanding and Exercisable ,Exercise prices | $0.09 |
Options exercisable at end of year, Shares | 1,300,000 |
Options Outstanding and Exercisable, Weighted average remaining contractual terms (years) | '4 days |
Options Outstanding and Exercisable, weighted Average Exercise price | $0.09 |
Income_Taxes_Additional_Inform
Income Taxes - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2013 | |
Operating Loss Carryforwards [Line Items] | ' |
Deferred tax assets, valuation allowance | 100.00% |
Operating loss carry forwards expiration year | '2021 |
Computation_of_Earnings_Per_Sh
Computation of Earnings Per Share Basic and Diluted (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Numerator: | ' | ' | ' | ' |
Net loss | ($1,045,662) | ($986,963) | ($2,403,114) | ($1,506,757) |
Denominator: | ' | ' | ' | ' |
Weighted-average common shares outstanding | ' | ' | 597,936,763 | 402,920,267 |
Dilutive effect of stock warrants and stock options | ' | ' | 0 | 0 |
Weighted-average common shares outstanding, assuming dilution | ' | ' | 597,936,763 | 402,920,267 |
Net loss per share: | ' | ' | ' | ' |
Basic and diluted | ' | ' | $0 | $0 |