Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2017 | May 09, 2017 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | COATES INTERNATIONAL LTD \DE\ | |
Entity Central Index Key | 948,426 | |
Amendment Flag | false | |
Trading Symbol | COTE | |
Current Fiscal Year End Date | --12-31 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 4,146,575,076 |
Balance Sheets
Balance Sheets - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Current Assets | ||
Cash | $ 2,555 | $ 9,163 |
Inventory, net | 191,482 | 191,482 |
Deferred offering costs and other assets | 1,000 | 47,028 |
Total Current Assets | 195,037 | 247,673 |
Property, plant and equipment, net | 2,065,218 | 2,076,396 |
Deferred licensing costs, net | 37,095 | 38,166 |
Total Assets | 2,297,350 | 2,362,235 |
Current Liabilities | ||
Accounts payable and accrued liabilities | 2,650,876 | 2,461,175 |
Promissory notes to related parties | 1,449,673 | 1,454,699 |
Deferred compensation payable | 1,394,127 | 1,272,317 |
Derivative liability related to convertible promissory notes | 204,749 | 153,472 |
Deposits on orders | 150,595 | 150,595 |
Convertible promissory notes, net of unamortized discount | 87,564 | 45,801 |
Mortgage loan payable | 60,000 | 60,000 |
Current portion of sublicense deposits | 55,925 | 60,725 |
Promissory note | 25,000 | |
Total Current Liabilities | 6,078,509 | 5,658,784 |
Non-current portion of mortgage loan payable | 1,258,158 | 1,273,158 |
Non-current portion of sublicense deposits | 627,175 | 627,175 |
Total Liabilities | 7,963,842 | 7,559,117 |
Commitments and Contingencies | ||
Stockholders' Deficiency | ||
Preferred stock, $0.001 par value, 100,000,000 shares authorized: Series A Preferred Stock, 1,000,000 shares designated, 720,722 and 50,000 shares issued and outstanding at March 31, 2017 and December 31, 2016, respectively | 720 | 50 |
Series B Convertible Preferred Stock, 75,000,000 shares designated, 16,981,089 and 16,252,584 shares issued and outstanding at March 31, 2017 and December 31, 2016, respectively | 16,981 | 16,253 |
Common Stock, $0.0001 par value, 12,000,000,000 shares authorized, 3,177,788,855 and 3,002,730,366 shares issued and outstanding at March 31, 2017 and December 31, 2016. respectively | 317,779 | 300,273 |
Additional paid-in capital | 60,172,286 | 59,813,632 |
Accumulated deficit | (66,174,258) | (65,327,090) |
Total Stockholders' Deficiency | (5,666,492) | (5,196,882) |
Total Liabilities and Stockholders' Deficiency | $ 2,297,350 | $ 2,362,235 |
Balance Sheets (Parenthetical)
Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2017 | Dec. 31, 2016 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, authorized shares | 100,000,000 | 100,000,000 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, authorized shares | 12,000,000,000 | 12,000,000,000 |
Common stock, issued shares | 3,177,788,855 | 3,002,730,366 |
Common stock, outstanding shares | 3,177,788,855 | 3,002,730,366 |
Series A Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Series A preferred stock, designated shares | 1,000,000 | 1,000,000 |
Series A Preferred stock, issued shares | 720,722 | 50,000 |
Series A Preferred stock, outstanding shares | 720,722 | 50,000 |
Series B Convertible Preferred Stock [Member] | ||
Series B convertible preferred stock, designated shares | 75,000,000 | 75,000,000 |
Series B Preferred stock, issued shares | 16,981,089 | 16,252,584 |
Series B Preferred stock, outstanding shares | 16,981,089 | 16,252,584 |
Statements of Operations (Unaud
Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Statements of Operations [Abstract] | ||
Sublicensing fee revenue | $ 4,800 | $ 4,800 |
Total Revenues | 4,800 | 4,800 |
Expenses: | ||
Research and development costs | 138,387 | 91,561 |
Stock-based compensation expense | 191,325 | 1,761,905 |
Compensation and benefits | 131,747 | 69,912 |
General and administrative expenses | 118,839 | 77,078 |
Depreciation and amortization | 12,249 | 12,749 |
Total Operating Expenses | 592,547 | 2,013,205 |
Loss from Operations | (587,747) | (2,008,405) |
Other Income (Expense): | ||
(Increase) decrease in estimated fair value of embedded derivative liabilities | (51,277) | 121,078 |
Loss on conversion of convertible notes | (11,629) | (26,380) |
Interest expense, net | (196,515) | (243,960) |
Total other income (expense) | (259,421) | (149,262) |
Loss Before Income Taxes | (847,168) | (2,157,667) |
Provision for income taxes | ||
Net Loss | $ (847,168) | $ (2,157,667) |
Basic net loss per share | $ 0 | $ 0 |
Basic weighted average shares outstanding | 3,100,963,595 | 1,144,882,150 |
Diluted net loss per share | $ 0 | $ 0 |
Diluted weighted average shares outstanding | 3,100,963,595 | 1,144,882,150 |
Condensed Statements of Cash Fl
Condensed Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Statement of Cash Flows [Abstract] | ||
Net Cash Used in Operating Activities | $ (144,527) | $ (151,530) |
Cash Used in Investing Activities: | ||
Acquisition of property, plant and equipment | (11,492) | |
Total Cash Used in Investing Activities | (11,492) | |
Cash Flows Provided (Used in) by Financing Activities: | ||
Issuance of convertible promissory notes | 90,000 | 85,000 |
Issuance of common stock under equity purchase agreements | 42,944 | 100,000 |
Issuance of promissory note | 25,000 | |
Issuance of promissory notes to related parties | 4,740 | |
Issuance of common stock and warrants | 25,000 | |
Repayment of mortgage loan | (15,000) | (15,000) |
Repayment of promissory notes to related parties | (9,765) | (10,000) |
Finance lease obligation payments | (8,625) | |
Net Cash Provided by Financing Activities | 137,919 | 176,375 |
Net (Decrease) Increase in Cash | (6,608) | 13,353 |
Cash, beginning of period | 9,163 | 29,207 |
Cash, end of period | 2,555 | 42,560 |
Supplemental Disclosure of Cash Flow Information: | ||
Cash paid during the period for interest | 26,566 | 26,925 |
Supplemental Disclosure of Non-cash Financing Activities: | ||
Conversion of convertible promissory notes | $ 56,372 | $ 294,679 |
The Company and Basis of Presen
The Company and Basis of Presentation | 3 Months Ended |
Mar. 31, 2017 | |
The Company and Basis of Presentation [Abstract] | |
THE COMPANY AND BASIS OF PRESENTATION | 1. THE COMPANY AND BASIS OF PRESENTATION Nature of Organization Coates International, Ltd. (the “Company” or “CIL”) has acquired the exclusive licensing rights to the patented Coates spherical rotary valve (“CSRV ® ® ® ® ® Management believes that the CSRV ® ● Improved fuel efficiency ● Lower levels of harmful emissions ● Adaptability to numerous types of engine fuels ● Longer engine life ● Longer intervals between engine servicing The CSRV ® ® ® ® ® ® ® Basis of Presentation The accompanying condensed financial statements include the accounts of the Company. In the opinion of the Company’s management, the condensed consolidated financial statements reflect all adjustments, which are normal and recurring in nature, necessary for fair financial statement presentation. The preparation of these condensed consolidated financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the amounts reported in these condensed consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates. Certain prior period amounts in the condensed financial statements have been reclassified to conform to the current period’s presentation. These condensed financial statements and accompanying notes should be read in conjunction with the Company’s annual financial statements and the notes thereto included in its Annual Report on Form 10-K for the year ended December 31, 2016 and the Company’s quarterly financial statements and the notes thereto included in its Quarterly Reports. Since the Company’s inception, the Company has been responsible for the development costs of the CSRV ® ® ® As shown in the accompanying financial statements, the Company has incurred recurring losses from operations and, as of March 31, 2017, had a stockholders’ deficiency of ($5,666,000). In addition, the recent trading price range of the Company’s common stock at a fraction of a penny has introduced additional difficulty to the Company’s challenge to secure needed additional working capital. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management has instituted a cost control program intended to restrict variable costs to only those expenses that are necessary to complete its activities related to entering the production phase of operations, develop additional commercially feasible applications of the CSRV ® The Company continues to actively seek out new sources of working capital; however, there can be no assurance that it will be successful in these efforts. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. Inventory Inventory consists of raw materials and work-in-process, including overhead. Effective January 2017, the Company adopted the accounting guidance of Accounting Standards Update No. 2015-11, “Inventory – Simplifying the Measurement of Inventory (Topic 330), on a prospective basis. Pursuant to this update, inventory is stated at the lower of cost or net realizable value. Prior thereto, inventory was stated at the lower of cost or market. This change in 2017 did not have a material effect on the reported inventory values. Inventory is accounted for on the first-in, first-out method. Use of Estimates The preparation of the Company’s financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. These significant estimates include determining the fair value of convertible promissory notes containing embedded derivatives and variable conversion rates, determining a value for shares of Series A Preferred Stock and Series B Convertible Preferred Stock issued, assigning useful lives to the Company’s property, plant and equipment, determining an appropriate amount to reserve for obsolete and slow moving inventory, estimating a valuation allowance for deferred tax assets, assigning expected lives to, and estimating the rate of forfeitures of, stock options granted and selecting a trading price volatility factor for the Company’s common stock in order to estimate the fair value of the Company’s stock options on the date of grant or other appropriate measurement date. Actual results could differ from those estimates. |
Concentrations of Credit and Bu
Concentrations of Credit and Business Risk | 3 Months Ended |
Mar. 31, 2017 | |
Concentrations of Credit and Business Risk [Abstract] | |
CONCENTRATIONS OF CREDIT AND BUSINESS RISK | 2. CONCENTRATIONS OF CREDIT AND BUSINESS RISK The Company maintains cash balances with one financial institution. Monies on deposit are fully insured by the Federal Deposit Insurance Corporation. The Company’s operations are devoted to the development, application and marketing of the CSRV ® ® |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2017 | |
Fair Value of Financial Instruments [Abstract] | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | 3. FAIR VALUE OF FINANCIAL INSTRUMENTS Cash, Other Assets, Accounts Payable and Accrued Liabilities and Other Liabilities With the exception of convertible promissory notes, the carrying amount of these items approximates their fair value because of the short term maturity of these instruments. The convertible promissory notes are reported at their estimated fair value, determined as described in more detail in Note 15. Limitations Fair value estimates are made at a specific point in time, based on relevant market information and information about the financial instrument. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimates. |
Licensing Agreement and Deferre
Licensing Agreement and Deferred Licensing Costs | 3 Months Ended |
Mar. 31, 2017 | |
Licensing Agreement and Deferred Licensing Costs [Abstract] | |
LICENSING AGREEMENT AND DEFERRED LICENSING COSTS | 4. LICENSING AGREEMENT AND DEFERRED LICENSING COSTS The Company holds a manufacturing, use, lease and sale license from George J. Coates and Gregory G. Coates for the CSRV ® ® ® ® ® Under the License Agreement, George J. Coates and Gregory G. Coates agreed that they will not grant any Western Hemisphere licenses to any other party with respect to the CSRV ® At March 31, 2017, and December 31, 2016, deferred licensing costs, comprised of expenditures for patent costs incurred pursuant to the CSRV ® |
Agreement Assigned to Almont En
Agreement Assigned to Almont Energy, Inc. | 3 Months Ended |
Mar. 31, 2017 | |
Agreement Assigned to Almont Energy, Inc. [Abstract] | |
AGREEMENT ASSIGNED TO ALMONT ENERGY, INC. | 5. AGREEMENT ASSIGNED TO ALMONT ENERGY, INC. In 2010, Almont Energy Inc. (“Almont”), a privately held, independent third-party entity based in Alberta, Canada became the assignee of a sublicense which covers the use of the CSRV ® ® In prior years, the Company received a non-refundable $300,000 deposit on the Canadian License. As the Company continues to be desirous of commencing shipments of its CSRV® products to Almont under the sublicense at such time that it is able to start up production operations, it has continued to amortize this deposit into income over the period until expiration of the last CSRV® system technology patent in force. At March 31, 2017, the unamortized balance was $185,000. Amortization of this amount is as follows: Year Ending Amount 2017 $ 15,000 2018 19,000 2019 19,000 2020 19,000 2021 19,000 Thereafter 94,000 $ 185,000 |
Non-Exclusive Distribution Subl
Non-Exclusive Distribution Sublicense with Renown Power Development, Ltd. | 3 Months Ended |
Mar. 31, 2017 | |
Non-Exclusive Distribution Sublicense with Renown Power Development, Ltd. [Abstract] | |
NON-EXCLUSIVE DISTRIBUTION SUBLICENSE WITH RENOWN POWER DEVELOPMENT, LTD. | 6. NON-EXCLUSIVE DISTRIBUTION SUBLICENSE WITH RENOWN POWER DEVELOPMENT, LTD. In February 2015, the Company granted a non-exclusive distribution sublicense to Renown Power Development, Ltd., a China-based sales and distribution company (“Renown”) covering the territory defined as the Western Hemisphere. Under this sublicense, Renown will be permitted to sell, lease and distribute CSRV ® In addition, Coates Power, Ltd., a China-based manufacturing company (“Coates Power”) intends to produce CSRV ® The Company received a $131,000 cash deposit with an order from Coates Power for two completed Gen Sets. This amount is included in Deposits in the accompanying balance sheets at March 31, 2017 and December 31, 2016. |
Inventory
Inventory | 3 Months Ended |
Mar. 31, 2017 | |
Inventory [Abstract] | |
INVENTORY | 7. INVENTORY Inventory consisted of the following: March 31, December 31, Raw materials $ 178,000 $ 178,000 Work-in-process 13,000 13,000 Total $ 191,000 $ 191,000 |
License Deposits
License Deposits | 3 Months Ended |
Mar. 31, 2017 | |
License Deposits [Abstract] | |
LICENSE DEPOSITS | 8. LICENSE DEPOSITS License deposits consist of monies received as deposits on sublicense agreements, primarily comprised of deposits from Renown in the amount of $498,000 and from Almont in the amount of $300,000. These deposits are being recognized as income on a straight-line basis over the remaining period until expiration of the last remaining CSRV ® In December 2016, the Company executed an exclusive license with Secure Supplies Mexico LLC and Secure Supplies USA LLC (collectively “Secure Supplies”) of Coates CSRV ® ® ® Upon execution of this agreement, Secure Supplies was to pay a one-time licensing fee of $1,000,000 to the Company. In addition, a royalty fee of $50 per engine or gen set sold to Secure Supplies, is to be paid to The Coates Trust, a private trust controlled by George J. Coates, regardless of the size or type of CSRV ® ® As of the date of this filing, the Company had not received a $1,000,000, one-time upfront license fee as required by the agreement and cannot determine when, and if, the fee will be collected. Accordingly, the Company has not recorded a $1,000,000 receivable for the past due upfront license fee or recognized any unpaid amount as revenue related to this license agreement. Sublicensing fee revenue for the three months ended March 31, 2017 and 2016 amounted to $5,000 and $5,000, respectively. |
Property, Plant and Equipment
Property, Plant and Equipment | 3 Months Ended |
Mar. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY, PLANT AND EQUIPMENT | 9. PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment at cost, less accumulated depreciation, consist of the following: March 31, 2017 December 31, Land $ 1,235,000 $ 1,235,000 Building 964,000 964,000 Building improvements 83,000 83,000 Machinery and equipment 689,000 689,000 Furniture and fixtures 57,000 57,000 3,028,000 3.028,000 Less: Accumulated depreciation (940,000 ) (952,000 ) Total $ 2,065,000 $ 2,076,000 Depreciation expense amounted to $11,000 and $12,000 for the three months ended March 31, 2017 and 2016, respectively. |
Mortgage Loan Payable
Mortgage Loan Payable | 3 Months Ended |
Mar. 31, 2017 | |
Mortgage Loan Payable/Promissory Note [Abstract] | |
MORTGAGE LOAN PAYABLE | 10. MORTGAGE LOAN PAYABLE The Company has a mortgage loan on the land and building that serves as its headquarters and research and development facility which bears interest at the rate of 7.5% per annum and matures in July 2018. Interest expense for the three months ended March 31, 2017 and 2016 amounted to $33,000 and $26,000, respectively. The loan requires monthly payments of interest, plus $5,000 which is being applied to the principal balance. The remaining principal balance at March 31, 2017 and December 31, 2016 was $1,318,000 and $1,333,000, respectively. The mortgage loan may be prepaid in whole, or, in part, at any time without penalty. The loan is collateralized by a security interest in all of the Company’s assets, the pledge of five million shares of common stock of the Company owned by George J. Coates, which were deposited into escrow for the benefit of the lender and the personal guarantee of George J. Coates. The Company is not permitted to create or permit any secondary mortgage or similar liens on the property or improvements thereon without prior consent of the lender. |
Finance Lease Obligation
Finance Lease Obligation | 3 Months Ended |
Mar. 31, 2017 | |
Finance Lease Obligation [Abstract] | |
FINANCE LEASE OBLIGATION | 11. FINANCE LEASE OBLIGATION In August 2013, the Company entered into a sale/leaseback financing arrangement pursuant to which it sold its research and development and manufacturing equipment in consideration for net cash proceeds of $133,000. This lease terminated in February 2016, upon which the Company reacquired title to the equipment. The effective interest rate on this lease was 36.6%. In accordance with GAAP, this sale/leaseback was required to be accounted for as a financing lease. Under this accounting method, the equipment and accumulated depreciation remained on the Company’s books and records as if the Company still owned the equipment. For the three months ended March 31, 2017 and 2016, interest expense amounted to $-0- and $2,000, respectively. These amounts are included in interest expense in the accompanying statements of operations. |
Accounts Payable and Accrued Li
Accounts Payable and Accrued Liabilities | 3 Months Ended |
Mar. 31, 2017 | |
Accounts Payable and Accrued Liabilities [Abstract] | |
ACCOUNTS PAYABLE AND ACCRUED LIABILITIES | 12. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES Accounts payable and accrued liabilities are as follows: March 31, 2017 December 31, Legal and professional fees $ 1,475,000 $ 1,452,000 Accrued interest expense 533,000 502,000 General and administrative expenses 528,000 392,000 Research and development costs 115,000 115,000 Total $ 2,651,000 $ 2,461,000 |
Promissory Notes to Related Par
Promissory Notes to Related Parties | 3 Months Ended |
Mar. 31, 2017 | |
Promissory Notes to Related Parties [Abstract] | |
PROMISSORY NOTES TO RELATED PARTIES | 13. PROMISSORY NOTES TO RELATED PARTIES Promissory Notes Issued to George J. Coates During the three months ended March 31, 2017 and 2016, the Company issued, in a series of transactions, promissory notes to George J. Coates and received cash proceeds of $4,000 and $-0-, respectively, repaid promissory notes to George J. Coates in the aggregate principal amount of $4,000 and $10,000, respectively. Interest expense for the three months ended March 31, 2017 and 2016 amounted to $13,000 and $13,000, respectively. The promissory notes are payable on demand and provide for interest at the rate of 17% per annum, compounded monthly. At March 31, 2017, the outstanding balance was $328,000, including accrued interest thereon. Promissory Note Issued to Gregory G. Coates The Company has a non-interest bearing promissory note due to Gregory G. Coates which is payable on demand. Interest is being imputed on this promissory note at the rate of 10% per annum. Interest expense for the three months ended March 31, 2017 and 2016, amounted to $35,000 and $36,000, respectively. At March 31, 2017, the outstanding principal balance was $1,438,000. Promissory Notes Issued to Bernadette Coates During the three months ended March 31, 2017 and 2016, the Company issued a promissory note to Bernadette Coates, spouse of George J. Coates and received cash proceeds of $1,000 and $-0-, respectively. The Company repaid promissory notes to Bernadette Coates in the principal amount of $6,000 and $-0-, respectively. The promissory notes are payable on demand and provide for interest at the rate of 17% per annum, compounded monthly. Interest expense for the three months ended March 31, 2017 and 2016 amounted to $3,000 and $3,000, respectively. At March 31, 2017, the outstanding balance amounted to $82,000, including accrued interest thereon. Unpaid accrued interest on these promissory notes amounting to $410,000 is included in accounts payable and accrued liabilities in the accompanying balance sheet at March 31, 2017. |
Promissory Note
Promissory Note | 3 Months Ended |
Mar. 31, 2017 | |
Mortgage Loan Payable/Promissory Note [Abstract] | |
PROMISSORY NOTE | 14. PROMISSORY NOTE In March 2017, the Company issued a $25,000 promissory note which matures May 13, 2017. Interest is payable upon maturity in the form of 10,000,000 shares of unregistered, restricted shares of the Company's common stock. The note provides for late payment fees of 750,000 additional shares of unregistered, restricted shares of the Company's common stock for each month after maturity that payment is late until repaid. In addition, the Company agreed to extend warrants held by the lender to purchase 10,839,752 shares of common stock that were scheduled to expire in 2017 for an additional five years and modify the exercise price to $0.0015. |
Convertible Promissory Notes an
Convertible Promissory Notes and Embedded Derivative Liability | 3 Months Ended |
Mar. 31, 2017 | |
Convertible Promissory Notes And Embedded Derivative Liability [Abstract] | |
CONVERTIBLE PROMISSORY NOTES AND EMBEDDED DERIVATIVE LIABILITY | 15. CONVERTIBLE PROMISSORY NOTES AND EMBEDDED DERIVATIVE LIABILITY From time to time, the Company issues convertible promissory notes, the proceeds of which are used for general working capital purposes. At March 31, 2017, there was $140,000 principal amount of convertible promissory notes outstanding. During the three months ended March 31, 2017 and 2016, $93,000 and $91,000 of convertible promissory notes were issued, respectively. Outstanding notes may be converted into unregistered shares of the Company’s common stock at a discount ranging from 30% to 39% of the defined trading price of the common stock on the date of conversion. The defined trading prices are based on the trading price of the stock during a defined period ranging from fifteen to twenty-five trading days immediately preceding the date of conversion. The conversion rate discount establishes a beneficial conversion feature (“BCF”) or unamortized discount, which is required to be valued and accreted to interest expense over the six-month period until the conversion of the notes into restricted shares of common stock is permitted. In addition, the conversion formula meets the conditions that require accounting for convertible notes as derivative liability instruments. The effective interest rate on the outstanding convertible notes at March 31, 2017 was 147%. The unamortized discount on the outstanding convertible notes at March 31, 2017 and December 31, 2016 amounted to $52,000 and $53,000, respectively. The convertible notes generally become convertible, in whole, or in part, beginning on the six month anniversary of the issuance date and may be prepaid at the option of the Company, generally with a prepayment penalty equal to 50% of the principal amount of the convertible note at any time prior to becoming eligible for conversion. One convertible promissory note with a balance of $23,000 is convertible in monthly installments in an amount determined by the noteholder of up to $23,000, plus accrued interest. The Company may elect, at its option to repay each monthly installment in whole, or in part, in cash, without penalty. The amount of each installment not paid in cash is converted into shares of the Company’s common stock. This convertible note also requires that the conversion price be re-measured 23 trading days after the conversion shares are originally delivered. If the re-measured conversion price is lower, then the Company is required to issue additional conversion shares to the noteholder. In accordance with GAAP, the estimated fair value of the embedded derivative liability related to the convertible notes is required to be remeasured at each balance sheet date. The fair value measurement accounting standard establishes a valuation hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used, when available. Observable inputs are inputs market participants would use in valuing the asset or liability developed based on independent market data sources. Unobservable inputs are inputs that reflect the Company’s assumptions about the factors market participants would use in valuing the asset or liability developed based upon the best information available. The valuation hierarchy is composed of three categories, which are as follows: ● Level 1 – Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. ● Level 2 – Inputs include quoted prices in active markets for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, and inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. ● Level 3 – Inputs to the fair value measurement are unobservable inputs or valuation techniques. The estimated fair value of the embedded derivative liabilities related to promissory notes outstanding was measured as the aggregate estimated fair value, based on Level 2 inputs, which included the average of the quoted daily yield curve rates on six-month and one-year treasury securities and, because the actual volatility rate on the Company’s common stock is not available, a conservative estimated volatility rate of 200%. The embedded derivative liability arises because, based on historical trading patterns of the Company’s stock, the formula for determining the Conversion Rate is expected to result in a different Conversion Rate than the closing price of the stock on the actual date of conversion (hereinafter referred to as the “Variable Conversion Rate Differential”). The estimated fair values of the derivative liabilities have been calculated based on a Black-Scholes option pricing model. The following table presents the Company's fair value hierarchy of financial assets and liabilities measured at fair value at: March 31, 2017 December 31, Level 1 Inputs $ - $ - Level 2 Inputs 205,000 153,000 Level 3 Inputs - - Total $ 205,000 $ 153,000 In a series of transactions, during the three months ended March 31, 2017, convertible promissory notes with an aggregate principal balance of $56,000, including accrued interest thereon were converted into 170,872,980 unregistered shares of common stock. The Company incurred a loss on these conversions amounting to $12,000 for the three months ended March 31, 2017. In a series of transactions, during the three months ended March 31, 2016, convertible promissory notes with an aggregate principal balance of $295,000, including accrued interest thereon were converted into 234,920,926 unregistered shares of common stock. The Company incurred a loss on these conversions amounting to $26,000 for the three months ended March 31, 2016. At March 31, 2017, the Company had reserved 2,112,854,710 shares of its unissued common stock for conversion of convertible promissory notes. The Company made the private placement of these securities in reliance upon Section 4(2) of the Securities Act of 1933, as amended (the “Act”), Rule 506 of Regulation D, and the rules and regulations promulgated thereunder, and/or upon any other exemption from the registration requirements of the Act, as applicable. |
Capital Stock
Capital Stock | 3 Months Ended |
Mar. 31, 2017 | |
Capital Stock/Stock Options [Abstract] | |
CAPITAL STOCK | 16. CAPITAL STOCK Common Stock The Company’s common stock is traded on OTC Pink Sheets. Investors can find stock quotes and market information for the Company at www.otcmarkets.com The following common stock transactions occurred during the three months ended March 31, 2017: ● In a series of transactions during the three months ended March 31, 2017, convertible promissory notes with an aggregate principal balance of $56,000, including accrued interest thereon were converted into 170,872,980 unregistered shares of common stock. ● During the three months ended March 31, 2017, Barry C. Kaye converted 1,372 shares of Series B into 1,372,000 unregistered, restricted shares of the Company’s common stock. The following common stock transactions occurred during the three months ended March 31, 2016: ● In a series of transactions during the three months ended March 31, 2016, convertible promissory notes with an aggregate principal balance of $295,000, including accrued interest thereon were converted into 234,920,926 unregistered shares of common stock. ● In a series of transactions during the three months ended March 31, 2016, the Company issued 37,234,002 registered shares of its common stock to Southridge Partners II LP (“Southridge”) under the 2015 EP Agreement, as discussed in Note 20, in consideration for $100,000. The proceeds were used for general working capital. ● In March 2016, the Company made a private sale, pursuant to a stock purchase agreement of 25,000,000 unregistered shares of its common stock and 25,000,000 common stock warrants to purchase one unregistered share of its common stock at an exercise price of $0.001 per share in consideration for $25,000. At March 31, 2017, on a pro forma basis, the approximate number of shares of common stock that would have been issued if all of the Company’s outstanding convertible notes eligible for conversion had been converted was 340,780,432. None of the outstanding stock options and warrants were assumed to be exercised since the trading price of the stock on March 31, 2017 was below the exercise price of such instruments. Preferred Stock and anti-dilution rights The Company is authorized to issue 100,000,000 shares of preferred stock, par value, $0.001 per share (the “Preferred Stock”). The Company may issue any class of the Preferred Stock in any series. The board is authorized to establish and designate series, and to fix the number of shares included in each such series and the relative rights, preferences and limitations as between series, provided that, if the stated dividends and amounts payable on liquidation are not paid in full, the shares of all series of the same class shall share ratably in the payment of dividends including accumulations, if any, in accordance with the sums which would be payable on such shares if all dividends were declared and paid in full and in any distribution of assets other than by way of dividends in accordance with the sums which would be payable on such distribution if all sums payable were discharged in full. Shares of each such series when issued, shall be designated to distinguish the shares of each series from shares of all other series. There are two series of Preferred Stock that have been designated to date from the total 100,000,000 authorized shares of Preferred Stock. These are as follows: ● Series A Preferred Stock, par value $0.001 per share (“Series A”), 1,000,000 shares designated, 770,222 and 50,000 shares issued and outstanding as of March 31, 2017 and December 31, 2016, respectively. Shares of Series A entitle the holder to 10,000 votes per share on all matters brought before the shareholders for a vote. These shares are not entitled to receive dividends or share in distributions of capital and have no liquidation preference. All outstanding shares of Series A are owned by George J. Coates. For the three months ended March 31, 2017, the Company issued 670,219 shares of Series A Preferred Stock to George J. Coates representing anti-dilution shares to restore Mr. Coates' percentage of eligible votes to 85.7%. This percentage increased during the year ended December 31, 2016 as a result of Mr. Coates' acquisition of 211,318,358 shares of common stock upon conversion of promissory notes from the Company which he held with a principal amount of $157,000 and 115,006,000 shares of common stock upon conversion of 115,006 shares of Series B Convertible Preferred Stock. ● Series B Convertible Preferred Stock, par value $0.001 per share, 75,000,000 shares designated, 16,981,089 and 16,252,584 shares issued and outstanding as of March 31, 2017 and December 31, 2016, respectively. Shares of Series B do not earn any dividends and may be converted at the option of the holder at any time beginning on the second annual anniversary date after the date of issuance into 1,000 unregistered shares of the Company’s common stock. Holders of Series B are entitled to one thousand votes per share held, on all matters brought before the shareholders for a vote. In the event that either (i) the Company enters into an underwriting agreement for a secondary public offering of securities, or (ii) a change in control of the Company is consummated representing 50% more of the then outstanding shares of Company’s common stock, plus the number of shares of common stock into which any convertible preferred stock is convertible, regardless of whether or not such shares are otherwise eligible for conversion, then the Series B may be immediately converted at the option of the holder into restricted shares of the Company’s common stock. The Company provides anti-dilution protection for certain of its key employees. For each new share of common stock issued by the Company to non-Coates family members in the future, additional shares of Series B will be issued to maintain their fixed ownership percentage of the Company. The fixed ownership percentage is adjusted for acquisitions and dispositions of common stock, not related to conversions of Series B Convertible Preferred Stock, by these key employees. At March 31, 2017, the fixed ownership percentages were as follows: ● George J. Coates – 80.63% ● Gregory G. Coates – 6.10% ● Barry C. Kaye – 0.048% These anti-dilution provisions do not apply to new shares of common stock issued in connection with exercises of employee stock options, a secondary public offering of the Company’s securities or a merger or acquisition. The following presents by year, the number of shares of Series B held and the year that they become eligible for conversion into shares of common stock, as of March 31, 2017. Total 2017 2018 2019 George J. Coates 15,674,047 3,135,357 11,766,624 772,066 Gregory G. Coates 1,216,320 224,975 872,014 119,331 Barry C. Kaye 90,722 13,063 68,266 9,393 Total 16,981,089 3,373,395 12,706,904 900,790 For the three months ended March 31, 2017, 772,066, 119,315 and 9,393 shares of Series B were issued to George J. Coates, Gregory G. Coates and Barry C. Kaye, respectively, having an estimated fair value of $132,000, $39,000 and $3,000, respectively. These amounts were included in stock-based compensation expense in the accompanying statement of operations for the three months ended March 31, 2017. For the three months ended March 31, 2016, 1,263,978, 86,048 and 6,736 shares of Series B were issued to George J. Coates, Gregory G. Coates and Barry C. Kaye, respectively, having an estimated fair value of $1,641,000, $112,000 and $9,000, respectively. These amounts were included in stock-based compensation expense in the accompanying statement of operations for the three months ended March 31, 2016. During the three months ended March 31, 2017, Barry C. Kaye converted 1,372 shares of Series B into 1,372,000 unregistered, restricted shares of the Company’s common stock. In the event that all of the 16,981,089 shares of Series B outstanding at March 31, 2017 were converted, once the conversion restrictions lapse, an additional 16,981,089,000 new restricted shares of common stock would be issued. On a pro forma basis, based on the number of shares of common stock outstanding at March 31, 2017, this would dilute the ownership percentage of non-affiliated stockholders from 81.0% to 12.8%. To the extent that additional shares of Series B are issued under the anti-dilution plan, the non-affiliated stockholders’ percentage ownership of the Company would be further diluted. |
Unearned Revenue
Unearned Revenue | 3 Months Ended |
Mar. 31, 2017 | |
Unearned Revenue [Abstract] | |
UNEARNED REVENUE | 17. UNEARNED REVENUE Unearned revenue at March 31, 2017, consisted of the following: ● A deposit received with an order for two CSRV® Gen Sets from Coates Power, Ltd., a China-based unaffiliated manufacturing company in the amount of $131,000. ● A $19,000 non-refundable deposit from Almont in connection with its order for a natural gas fueled electric power CSRV® engine generator. |
Sublicensing Fee Revenue
Sublicensing Fee Revenue | 3 Months Ended |
Mar. 31, 2017 | |
Sublicensing Fee Revenue [Abstract] | |
SUBLICENSING FEE REVENUE | 18. SUBLICENSING FEE REVENUE Sublicensing fee revenue for the three months ended March 31, 2017 and 2016 amounted to $5,000 and $5,000, respectively. The Company is recognizing the license deposit of $300,000 on the Canadian License as revenue on a straight-line basis over the approximate remaining life until 2027 of the last CSRV ® |
Loss Per Share
Loss Per Share | 3 Months Ended |
Mar. 31, 2017 | |
Loss Per Share [Abstract] | |
LOSS PER SHARE | 19. LOSS PER SHARE At March 31, 2017, there were stock warrants outstanding to purchase 150,344,911 shares of common stock at exercise prices ranging from $0.0005 to $0.675 per share and vested stock options outstanding to acquire 12,470,000 shares of common stock at exercise prices ranging from $0.028 to $0.44 per share and $72,000 of convertible promissory notes eligible for conversion, which on a pro forma basis, assuming they would have been converted on March 31, 2017, would have been convertible into 340,780,432 shares of common stock. At March 31, 2016, there were stock warrants outstanding to purchase 60,344,911 shares of common stock at exercise prices ranging from $0.001 to $0.12 per share and vested stock options outstanding to acquire 12,470,000 shares of common stock at exercise prices ranging from $0.028 to $0.44 per share and $252,000 of convertible promissory notes eligible for conversion, which on a pro forma basis, assuming they would have been converted on March 31, 2016, would have been convertible into 244,775,045 shares of common stock. For the three months ended March 31, 2017 and 2016, none of the potentially issuable shares of common stock were assumed to be converted because the Company incurred a net loss in those periods and the effect of including them in the calculation of earnings per share would have been anti-dilutive. |
Stock Options
Stock Options | 3 Months Ended |
Mar. 31, 2017 | |
Capital Stock/Stock Options [Abstract] | |
STOCK OPTIONS | 20. STOCK OPTIONS The Company’s 2006 Stock Option and Incentive Plan (the “Stock Plan”) was adopted by the Company’s board in October 2006. In September 2007, the Stock Plan, by consent of George J. Coates, majority shareholder, was adopted by our shareholders. The Stock Plan provides for the grant of stock-based awards to employees, officers and directors of, and consultants or advisors to, the Company and its subsidiaries, if any. Under the Stock Plan, the Company may grant options that are intended to qualify as incentive stock options within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (“ISO’s”), options not intended to qualify as incentive stock options (“non-statutory options”), restricted stock and other stock-based awards. ISO’s may be granted only to employees of the Company. All of the shares of common stock authorized under the Stock Plan have been granted and no further grants may be awarded thereunder. The Company established a 2014 Stock Option and Incentive Plan (the “2014 Stock Plan”) which was adopted by the Company’s board on May 30, 2014. On March 2, 2015, the 2014 Stock Plan, by consent of George J. Coates, majority shareholder, was adopted by our shareholders. The 2014 Stock Plan provides for the grant of stock-based awards to employees, officers and directors of, and consultants or advisors to, the Company and its subsidiaries, if any. Under the 2014 Stock Plan, the Company may grant ISO’s, non-statutory options, restricted stock and other stock-based awards. ISO’s may be granted only to employees of the Company. A total of 50,000,000 shares of common stock may be issued upon the exercise of options or other awards granted under the 2014 Stock Plan. The maximum number of shares with respect to which awards may be granted during any one year to any employee under the 2014 Stock Plan shall not exceed 25% of the 50,000,000 shares of common stock covered by the 2014 Stock Plan. At March 31, 2017, none of the shares of common stock authorized under the 2014 Stock Plan had been granted as stock options or awards. The Stock Plan and the 2014 Stock Plan (the “Stock Plans”) are administered by the board and the Compensation Committee. Subject to the provisions of the Stock Plans, the board and the Compensation Committee each has the authority to select the persons to whom awards are granted and determine the terms of each award, including the number of shares of common stock subject to the award. Payment of the exercise price of an award may be made in cash, in a “cashless exercise” through a broker, or if the applicable stock option agreement permits, shares of common stock, or by any other method approved by the board or Compensation Committee. Unless otherwise permitted by the Company, awards are not assignable or transferable except by will or the laws of descent and distribution. Upon the consummation of an acquisition of the business of the Company, by merger or otherwise, the board shall, as to outstanding awards (on the same basis or on different bases as the board shall specify), make appropriate provision for the continuation of such awards by the Company or the assumption of such awards by the surviving or acquiring entity and by substituting on an equitable basis for the shares then subject to such awards either (a) the consideration payable with respect to the outstanding shares of common stock in connection with the acquisition, (b) shares of stock of the surviving or acquiring corporation, or (c) such other securities or other consideration as the board deems appropriate, the fair market value of which (as determined by the board in its sole discretion) shall not materially differ from the fair market value of the shares of common stock subject to such awards immediately preceding the acquisition. In addition to, or in lieu of the foregoing, with respect to outstanding stock options, the board may, on the same basis or on different bases as the board shall specify, upon written notice to the affected optionees, provide that one or more options then outstanding must be exercised, in whole or in part, within a specified number of days of the date of such notice, at the end of which period such options shall terminate, or provide that one or more options then outstanding, in whole or in part, shall be terminated in exchange for a cash payment equal to the excess of the fair market value (as determined by the board in its sole discretion) for the shares subject to such stock options over the exercise price thereof. Unless otherwise determined by the board (on the same basis or on different bases as the board shall specify), any repurchase rights or other rights of the Company that relate to a stock option or other award shall continue to apply to consideration, including cash, that has been substituted, assumed or amended for a stock option or other award pursuant to these provisions. The Company may hold in escrow all or any portion of any such consideration in order to effectuate any continuing restrictions. The board may at any time provide that any stock options shall become immediately exercisable in full or in part, that any restricted stock awards shall be free of some or all restrictions, or that any other stock-based awards may become exercisable in full or in part or free of some or all restrictions or conditions, or otherwise realizable in full or in part, as the case may be. The board or Compensation Committee may, in its sole discretion, amend, modify or terminate any award granted or made under the Stock Plan, so long as such amendment, modification or termination would not materially and adversely affect the participant. During the three months ended March 31, 2017 and 2016, no stock options were granted. There were no unvested stock options outstanding at March 31, 2017. During the three months ended March 31, 2017 and 2016, the Company did not incur any stock-based compensation expense related to employee stock options. At March 31, 2017, all stock-based compensation expense related to outstanding stock options had been fully recognized. Details of the stock options outstanding under the Company’s Stock Option Plans are as follows: Exercise Price Per Share Number Outstanding Weighted Average Remaining Contractual Life Number Exercisable Weighted Average Exercise Price Weighted Average Fair Value Per Stock Option at Date of Grant Balance, 3/31/17 $0.028 – $0.44 12,470,000 10 12,470,000 $ 0.182 $ 0.169 No stock options were exercised, forfeited or expired during the three months ended March 31, 2017 and 2016. The weighted average fair value of the Company's stock options was estimated using the Black-Scholes option pricing model which requires highly subjective assumptions including the expected stock price volatility. These assumptions were as follows: ● Historical stock price volatility 139% - 325% ● Risk-free interest rate 0.21% - 4.64% ● Expected life (in years) 4 ● Dividend yield 0.00 The valuation assumptions were determined as follows: ● Historical stock price volatility: The Company utilized the volatility in the trading of its common stock computed for the 12 months of trading immediately preceding the date of grant. ● Risk-free interest rate: The Company bases the risk-free interest rate on the interest rate payable on U.S. Treasury securities in effect at the time of the grant for a period that is commensurate with the assumed expected option life. ● Expected life: The expected life of the options represents the period of time options are expected to be outstanding. The Company has very limited historical data on which to base this estimate. Accordingly, the Company estimated the expected life based on its assumption that the executives will be subject to frequent blackout periods during the time that the stock options will be exercisable and based on the Company’s expectation that it will complete its research and development phase and commence its initial production phase. The vesting period of these options was also considered in the determination of the expected life of each stock option grant. ● No expected dividends. |
Equity Purchase and Registratio
Equity Purchase and Registration Rights Agreements | 3 Months Ended |
Mar. 31, 2017 | |
Equity Purchase and Registration Rights Agreements [Abstract] | |
EQUITY PURCHASE AND REGISTRATION RIGHTS AGREEMENTS | 21. EQUITY PURCHASE AND REGISTRATION RIGHTS AGREEMENTS In July 2015, the Company entered into an equity purchase agreement (the “EP Agreement”) with Southridge Partners II LP, a Delaware limited partnership (“Southridge”). Pursuant to the terms of the EP Agreement, Southridge committed to purchase up to 205,000,000 shares of the Company’s common stock at 94% of the lowest closing price of the common stock during the ten trading days that comprise the defined pricing period. In December 2016, the EP Agreement automatically terminated because Southridge had purchased all 205,000,000 registered shares of common stock under the EP Agreement. The Company filed a registration statement with the SEC covering 205,000,000 shares of common stock underlying the EP Agreement, which was declared effective in August 2015. During the three months ended March 31, 2016, the Company sold 37,234,042 registered shares of common stock to Southridge and received proceeds of $100,000 under the EP Agreement. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2017 | |
Income Taxes [Abstract] | |
INCOME TAXES | 22. INCOME TAXES Deferred income taxes are determined using the liability method for the temporary differences between the financial reporting basis and income tax basis of the Company’s assets and liabilities. Deferred income taxes are measured based on the tax rates expected to be in effect when the temporary differences are included in the Company’s tax return. Deferred tax assets and liabilities are recognized based on anticipated future tax consequences attributable to differences between financial statement carrying amounts of assets and liabilities and their respective tax bases. Deferred tax assets increased by $209,000 and $833,000 for the three months ended March 31, 2017 and 2016, respectively. These amounts were fully offset by a corresponding increase in the tax valuation allowance resulting in no net change in deferred tax assets, respectively, during these periods. No liability for unrecognized tax benefits was required to be reported at March 31, 2017 and December 31, 2016. Based on the Company's evaluation, it has concluded that there are no significant uncertain tax positions requiring recognition in the Company's financial statements. The Company's evaluation was performed for tax years ended 2013 through 2015, the only periods subject to examination. The Company believes that its income tax positions and deductions will be sustained on audit and does not anticipate that adjustments, if any, will result in a material change to its financial position. For the three months ended March 31, 2017 and 2016, there were no penalties or interest related to the Company’s income tax returns. At March 31, 2017, the Company had available, $20,793,000 of net operating loss carryforwards which may be used to reduce future federal taxable income, expiring between 2018 and 2037 and $10,969,000 of net operating loss carryforwards which may be used to reduce future state taxable income, expiring between 2029 and 2037. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2017 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | 23. RELATED PARTY TRANSACTIONS Issuances and Repayments of Promissory Notes to Related Parties Issuances and repayments of promissory notes to related parties during the three months ended March 31, 2017 and 2016, are discussed in detail in Note 13. Issuances of Preferred Stock Shares of Series A Preferred Stock awarded to George J. Coates and Shares of Series B Convertible Preferred Stock awarded to George J. Coates, Gregory G. Coates and Barry C. Kaye during the three months ended March 31, 2017 and 2016 are discussed in detail in Note 16. Personal Guaranty and Stock Pledge In connection with the Company’s mortgage loan, George J. Coates has pledged certain of his shares of common stock of the Company to the extent required by the lender and provided a personal guaranty as additional collateral for a mortgage loan on the Company’s headquarters facility. Compensation and Benefits Paid The approximate amount of compensation and benefits, all of which were approved by the board, paid to George J. Coates, Gregory G. Coates and Bernadette Coates, exclusive of stock-based compensation for unregistered, restricted shares of Preferred Stock awarded to George J. Coates and Gregory G. Coates is summarized as follows: For the 2017 2016 George J. Coates (a) (b) (c) $ 14,000 $ 3,000 Gregory G. Coates (d) (e) 3,000 40,000 Bernadette Coates (f) 1,000 1,000 (a) For the three months ended March 31, 2017 and 2016, George J. Coates earned additional base compensation of $53,000 and $63,000, respectively, payment of which is being deferred until the Company has sufficient working capital. These amounts are included in deferred compensation in the accompanying balance sheets at March 31, 2017 and December 31, 2016. (b) During the three months ended March 31, 2017 and 2016, George J. Coates was awarded 772,066 and 1,263,978 shares of Series B Convertible Preferred Stock, respectively, with an estimated fair value of $199,000 and $1,641,000, respectively, for anti-dilution. (c) During the three months ended March 31, 2017, George J. Coates was awarded 670,222 shares of Series A Preferred Stock with an estimated fair value of $17,000, for anti-dilution. (d) For the three months ended March 31, 2017 and 2016, Gregory G. Coates earned additional base compensation of $38,000 and $-0-, respectively, payment of which is being deferred until the Company has sufficient working capital. These amounts are included in deferred compensation in the accompanying balance sheets at March 31, 2017 and December 31, 2016. (e) During the three months ended March 31, 2017 and 2016, Gregory G. Coates was awarded 119,331 and 86,048 shares of Series B Convertible Preferred Stock, respectively, with an estimated fair value of $39,000 and $112,000, respectively, for anti-dilution. (f) For the three months ended March 31, 2017 and 2016, Bernadette Coates earned additional base compensation of $17,000 and $17,000, respectively, payment of which is being deferred until the Company has sufficient working capital. These amounts are included in deferred compensation in the accompanying balance sheets at March 31, 2017 and December 31, 2016. During the three months ended March 31, 2017 and 2016, Barry C. Kaye, Treasurer and Chief Financial Officer was paid compensation of $10,000 and $-0-, respectively. For the three months ended March 31, 2017 and 2016, Mr. Kaye earned compensation of $32,000 and $23,000, respectively, which was not paid and is being deferred until the Company has sufficient working capital to remit payment to him. Starting in September 2016, the Company agreed to pay Mr. Kaye interest on the balance of his deferred compensation retroactive to when it began being deferred in May 2012. Interest continues to be accrued on the unpaid balance. During the three months ended March 31, 2017, interest accrued on Mr. Kaye’s deferred compensation amounted to $11,000. At March 31, 2017, the total amount of Mr. Kaye’s unpaid, deferred compensation, including accrued interest thereon, was $343,000. This amount is included in accounts payable and accrued liabilities in the accompanying balance sheet at March 31, 2017. During the three months ended March 31, 2017 and 2016, Barry C. Kaye was awarded 9,393 and 6,736 shares of Series B Convertible Preferred Stock, respectively, with an estimated fair value of $3,000 and $9,000, respectively, for anti-dilution. |
Contractual Obligations and Com
Contractual Obligations and Commitments | 3 Months Ended |
Mar. 31, 2017 | |
Contractual Obligations and Commitments [Abstract] | |
CONTRACTUAL OBLIGATIONS AND COMMITMENTS | 24. CONTRACTUAL OBLIGATIONS AND COMMITMENTS The following table summarizes the Company’s contractual obligations and commitments at March 31, 2017: Total 2017 2018 Promissory notes to related parties $ 1,450,000 $ 1,450,000 $ - Mortgage loan payable 1,318,000 60,000 1,258,000 Deferred compensation 1,394,000 1,394,000 - Convertible promissory notes 140,000 117,000 23,000 Promissory note 25,000 25,000 - Total $ 4,327,000 $ 3,046,000 $ 1,281,000 |
Litigation and Contingencies
Litigation and Contingencies | 3 Months Ended |
Mar. 31, 2017 | |
Litigation And Contingencies [Abstract] | |
LITIGATION AND CONTINGENCIES | 25. LITIGATION AND CONTINGENCIES The Company is not a party to any litigation that is material to its business. |
Recently Issued Accounting Stan
Recently Issued Accounting Standards | 3 Months Ended |
Mar. 31, 2017 | |
Recently Issued Accounting Standard [Abstract] | |
RECENTLY ISSUED ACCOUNTING STANDARDS | 26. RECENTLY ISSUED ACCOUNTING STANDARDS Revenue Recognition In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”), which amends the existing accounting standards for revenue recognition. ASU 2014-09 is based on principles that govern the recognition of revenue at an amount an entity expects to be entitled to when products are transferred to customers. In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606) – Deferral of the Effective Date, which defers the effective date of ASU 2014-09 for one year and permits early adoption. Accordingly, the Company may adopt the standard in either its first quarter of 2018 or 2019. In April 2016, the FASB issued ASU No. 2016-10, Revenue from Contracts with Customers (Topic 606) – Identifying Performance Obligations and Licensing (“ASU 2016-10”), which amends the guidance in ASU 2014-09 related to identifying performance obligations and accounting for licenses of intellectual property. The Company will adopt ASU 2016-10 with ASU 2014-09. The Company is currently evaluating the impact of adopting the new revenue recognition standard, as amended, but does not expect it to have a material impact on its financial statements. Stock Compensation In March 2016, the FASB issued ASU No. 2016-09, Compensation – Stock Compensation (Topic 718), which simplified certain aspects of the accounting for share-based payment transactions, including income taxes, classification of awards and classification in the statement of cash flows. ASU 2016-09 will be effective for the Company beginning in its first quarter of 2018. The Company is currently evaluating the impact of adopting the new stock compensation standard, but does not expect it to have a material impact on its financial statements. Financial Instruments In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments – Overall (Subtopic 825-10) (“ASU 2016-01”), which updates certain aspects of recognition, measurement, presentation and disclosure of financial instruments. ASU 2016-01 will be effective for the Company beginning in its first quarter of 2019. The Company does not believe the adoption of the new financial instruments standard will have a material impact on its financial statements. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2017 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 27. SUBSEQUENT EVENTS Issuance of Convertible Promissory Notes During the period from April 1 to May 9, 2017, the Company issued three new convertible promissory notes and received net proceeds of $109,000, after transaction costs. The holders may convert the convertible note at any time beginning six months after funding, into shares of the Company's common stock at a conversion price ranging from 61% to 65% of the trading price, as defined, of the Company’s common stock over a specified trading period prior to the date of conversion. In addition, the Company and certain noteholders mutually agreed to fund additional back-end, collateralized convertible notes that were executed in 2016. The principal amount of the back-end notes funded was $304,000 after transaction costs. These notes were immediately eligible for conversion upon funding. The conversion price of the back-end notes ranged from 62% to 70% of the trading price, as defined, of the Company’s common stock over a specified trading period prior to the date of conversion. Conversion of Convertible Promissory Notes During the period from April 1 to May 9, 2017, $226,000 principal amount of convertible promissory notes, including accrued interest, was converted into 960,097,696 unregistered, restricted shares of the Company’s common stock. Issuance of Anti-dilution shares During the period from April 1 to May 9, 2017, the Company issued 3,409,590, 258,091 and 20,205 shares of Series B Convertible Preferred Stock to George J. Coates, Gregory G. Coates and Barry C. Kaye, respectively, representing anti-dilution shares related to newly issued shares of common stock. The estimated fair value of these shares was $1,125,000, $85,000 and $7,000, respectively. Issuances of Promissory Notes to Related Parties During the period from April 1 to May 9, 2017, the Company issued promissory notes to George J. Coates and received cash proceeds of $16,000 and repaid promissory notes to George J. Coates amounting to $25,000, including interest of $6,000. The promissory notes are payable on demand and provide for interest at the rate of 17% per annum, compounded monthly. During the period from April 1 to May 9, 2017, the Company issued promissory notes to Bernadette Coates and received cash proceeds of $23,000 and repaid promissory notes to Bernadette Coates amounting to $10,000. The promissory notes are payable on demand and provide for interest at the rate of 17% per annum, compounded monthly. Deferred Compensation As of May 9, 2017, George J. Coates, Gregory G. Coates, Barry C. Kaye and Bernadette Coates agreed to additional deferral of their compensation amounting to $28,000, $17,000, $14,000 and $8,000, respectively. During this period, Mr. Kaye was also paid $15,000. At May 9, 2017 the total balance of their deferred compensation was $1,061,000, $87,000, $224,000 and $283,000, respectively. Promissory Note On April 13, 2017, the Company issued a promissory note for $5,000 providing for interest thereon at the rate of 25% per annum. On April 25, 2017, this promissory note, including accrued interest thereon was repaid. On May 5, 2017, the Company repaid the $25,000 promissory note and issued 8,688,525 unregistered, restricted shares of the Company’s common stock to the holder in payment of interest on the note. |
The Company and Basis of Pres33
The Company and Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2017 | |
The Company and Basis of Presentation [Abstract] | |
Nature of Organization | Nature of Organization Coates International, Ltd. (the “Company” or “CIL”) has acquired the exclusive licensing rights to the patented Coates spherical rotary valve (“CSRV ® ® ® ® ® Management believes that the CSRV ® ● Improved fuel efficiency ● Lower levels of harmful emissions ● Adaptability to numerous types of engine fuels ● Longer engine life ● Longer intervals between engine servicing The CSRV ® ® ® ® ® ® ® |
Basis of Presentation | Basis of Presentation The accompanying condensed financial statements include the accounts of the Company. In the opinion of the Company’s management, the condensed consolidated financial statements reflect all adjustments, which are normal and recurring in nature, necessary for fair financial statement presentation. The preparation of these condensed consolidated financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the amounts reported in these condensed consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates. Certain prior period amounts in the condensed financial statements have been reclassified to conform to the current period’s presentation. These condensed financial statements and accompanying notes should be read in conjunction with the Company’s annual financial statements and the notes thereto included in its Annual Report on Form 10-K for the year ended December 31, 2016 and the Company’s quarterly financial statements and the notes thereto included in its Quarterly Reports. Since the Company’s inception, the Company has been responsible for the development costs of the CSRV ® ® ® As shown in the accompanying financial statements, the Company has incurred recurring losses from operations and, as of March 31, 2017, had a stockholders’ deficiency of ($5,666,000). In addition, the recent trading price range of the Company’s common stock at a fraction of a penny has introduced additional difficulty to the Company’s challenge to secure needed additional working capital. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management has instituted a cost control program intended to restrict variable costs to only those expenses that are necessary to complete its activities related to entering the production phase of operations, develop additional commercially feasible applications of the CSRV ® The Company continues to actively seek out new sources of working capital; however, there can be no assurance that it will be successful in these efforts. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. |
Inventory | Inventory Inventory consists of raw materials and work-in-process, including overhead. Effective January 2017, the Company adopted the accounting guidance of Accounting Standards Update No. 2015-11, “Inventory – Simplifying the Measurement of Inventory (Topic 330), on a prospective basis. Pursuant to this update, inventory is stated at the lower of cost or net realizable value. Prior thereto, inventory was stated at the lower of cost or market. This change in 2017 did not have a material effect on the reported inventory values. Inventory is accounted for on the first-in, first-out method. |
Use of Estimates | Use of Estimates The preparation of the Company’s financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. These significant estimates include determining the fair value of convertible promissory notes containing embedded derivatives and variable conversion rates, determining a value for shares of Series A Preferred Stock and Series B Convertible Preferred Stock issued, assigning useful lives to the Company’s property, plant and equipment, determining an appropriate amount to reserve for obsolete and slow moving inventory, estimating a valuation allowance for deferred tax assets, assigning expected lives to, and estimating the rate of forfeitures of, stock options granted and selecting a trading price volatility factor for the Company’s common stock in order to estimate the fair value of the Company’s stock options on the date of grant or other appropriate measurement date. Actual results could differ from those estimates. |
Agreement Assigned to Almont 34
Agreement Assigned to Almont Energy, Inc. (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Agreement Assigned to Almont Energy, Inc. [Abstract] | |
Summary of amortization | Year Ending Amount 2017 $ 15,000 2018 19,000 2019 19,000 2020 19,000 2021 19,000 Thereafter 94,000 $ 185,000 |
Inventory (Tables)
Inventory (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Inventory [Abstract] | |
Summary of inventory | March 31, December 31, Raw materials $ 178,000 $ 178,000 Work-in-process 13,000 13,000 Total $ 191,000 $ 191,000 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Summary of property, plant and equipment | March 31, 2017 December 31, Land $ 1,235,000 $ 1,235,000 Building 964,000 964,000 Building improvements 83,000 83,000 Machinery and equipment 689,000 689,000 Furniture and fixtures 57,000 57,000 3,028,000 3.028,000 Less: Accumulated depreciation (940,000 ) (952,000 ) Total $ 2,065,000 $ 2,076,000 |
Accounts Payable and Accrued 37
Accounts Payable and Accrued Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Accounts Payable and Accrued Liabilities [Abstract] | |
Summary of accounts payable and accrued liabilities | March 31, 2017 December 31, Legal and professional fees $ 1,475,000 $ 1,452,000 Accrued interest expense 533,000 502,000 General and administrative expenses 528,000 392,000 Research and development costs 115,000 115,000 Total $ 2,651,000 $ 2,461,000 |
Convertible Promissory Notes 38
Convertible Promissory Notes and Embedded Derivative Liability (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Convertible Promissory Notes And Embedded Derivative Liability [Abstract] | |
Schedule of fair value hierarchy of financial assets and liabilities measured at fair value | March 31, 2017 December 31, Level 1 Inputs $ - $ - Level 2 Inputs 205,000 153,000 Level 3 Inputs - - Total $ 205,000 $ 153,000 |
Capital Stock (Tables)
Capital Stock (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Capital Stock/Stock Options [Abstract] | |
Schedule of conversion to shares of common stock | Total 2017 2018 2019 George J. Coates 15,674,047 3,135,357 11,766,624 772,066 Gregory G. Coates 1,216,320 224,975 872,014 119,331 Barry C. Kaye 90,722 13,063 68,266 9,393 Total 16,981,089 3,373,395 12,706,904 900,790 |
Stock Options (Tables)
Stock Options (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Capital Stock/Stock Options [Abstract] | |
Summary of stock options outstanding under the company's stock option plans | Exercise Price Per Share Number Outstanding Weighted Average Remaining Contractual Life Number Exercisable Weighted Average Exercise Price Weighted Average Fair Value Per Stock Option at Date of Grant Balance, 3/31/17 $0.028 – $0.44 12,470,000 10 12,470,000 $ 0.182 $ 0.169 |
Summary of assumptions used to determine weighted average fair value | ● Historical stock price volatility 139% - 325% ● Risk-free interest rate 0.21% - 4.64% ● Expected life (in years) 4 ● Dividend yield 0.00 The valuation assumptions were determined as follows: ● Historical stock price volatility: The Company utilized the volatility in the trading of its common stock computed for the 12 months of trading immediately preceding the date of grant. ● Risk-free interest rate: The Company bases the risk-free interest rate on the interest rate payable on U.S. Treasury securities in effect at the time of the grant for a period that is commensurate with the assumed expected option life. ● Expected life: The expected life of the options represents the period of time options are expected to be outstanding. The Company has very limited historical data on which to base this estimate. Accordingly, the Company estimated the expected life based on its assumption that the executives will be subject to frequent blackout periods during the time that the stock options will be exercisable and based on the Company’s expectation that it will complete its research and development phase and commence its initial production phase. The vesting period of these options was also considered in the determination of the expected life of each stock option grant. ● No expected dividends. |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Related Party Transactions [Abstract] | |
Summary of approximate amount of base compensation and benefits | For the 2017 2016 George J. Coates (a) (b) (c) $ 14,000 $ 3,000 Gregory G. Coates (d) (e) 3,000 40,000 Bernadette Coates (f) 1,000 1,000 (a) For the three months ended March 31, 2017 and 2016, George J. Coates earned additional base compensation of $53,000 and $63,000, respectively, payment of which is being deferred until the Company has sufficient working capital. These amounts are included in deferred compensation in the accompanying balance sheets at March 31, 2017 and December 31, 2016. (b) During the three months ended March 31, 2017 and 2016, George J. Coates was awarded 772,066 and 1,263,978 shares of Series B Convertible Preferred Stock, respectively, with an estimated fair value of $199,000 and $1,641,000, respectively, for anti-dilution. (c) During the three months ended March 31, 2017, George J. Coates was awarded 670,222 shares of Series A Preferred Stock with an estimated fair value of $17,000, for anti-dilution. (d) For the three months ended March 31, 2017 and 2016, Gregory G. Coates earned additional base compensation of $38,000 and $-0-, respectively, payment of which is being deferred until the Company has sufficient working capital. These amounts are included in deferred compensation in the accompanying balance sheets at March 31, 2017 and December 31, 2016. (e) During the three months ended March 31, 2017 and 2016, Gregory G. Coates was awarded 119,331 and 86,048 shares of Series B Convertible Preferred Stock, respectively, with an estimated fair value of $39,000 and $112,000, respectively, for anti-dilution. (f) For the three months ended March 31, 2017 and 2016, Bernadette Coates earned additional base compensation of $17,000 and $17,000, respectively, payment of which is being deferred until the Company has sufficient working capital. These amounts are included in deferred compensation in the accompanying balance sheets at March 31, 2017 and December 31, 2016. |
Contractual Obligations and C42
Contractual Obligations and Commitments (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Contractual Obligations and Commitments [Abstract] | |
Summary of contractual obligations and commitments | Total 2017 2018 Promissory notes to related parties $ 1,450,000 $ 1,450,000 $ - Mortgage loan payable 1,318,000 60,000 1,258,000 Deferred compensation 1,394,000 1,394,000 - Convertible promissory notes 140,000 117,000 23,000 Promissory note 25,000 25,000 - Total $ 4,327,000 $ 3,046,000 $ 1,281,000 |
The Company and Basis of Pres43
The Company and Basis of Presentation (Details) - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
The Company and Basis of Presentation (Textual) | ||
Stockholder's deficiency | $ (5,666,492) | $ (5,196,882) |
Negative working capital | $ (5,858,000) | $ (5,411,000) |
Licensing Agreement and Defer44
Licensing Agreement and Deferred Licensing Costs (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Licensing Agreement and Deferred Licensing Costs (Textual) | |||
Deferred licensing costs | $ 37,000 | $ 38,000 | |
Amortization expense | $ 1,000 | $ 1,000 |
Agreement Assigned to Almont 45
Agreement Assigned to Almont Energy, Inc. (Details ) | Mar. 31, 2017USD ($) |
Agreement Assigned to Almont Energy, Inc. [Abstract] | |
2,017 | $ 15,000 |
2,018 | 19,000 |
2,019 | 19,000 |
2,020 | 19,000 |
2,021 | 19,000 |
Thereafter | 94,000 |
Amortization amount | $ 185,000 |
Agreement Assigned to Almont 46
Agreement Assigned to Almont Energy, Inc. (Details Textual) | 3 Months Ended |
Mar. 31, 2017USD ($) | |
Agreements Assigned to Almont Energy, Inc. (Textual) | |
Unamortized balance | $ 185,000 |
Canadian License [Member] | |
Agreements Assigned to Almont Energy, Inc. (Textual) | |
Company received a non-refundable deposit | $ 300,000 |
Non-Exclusive Distribution Su47
Non-Exclusive Distribution Sublicense with Renown Power Development, Ltd. (Details) - USD ($) | 1 Months Ended | |
Feb. 28, 2015 | Mar. 31, 2017 | |
Non-Exclusive Distribution Sublicense with Renown Power Development, Ltd. (Textual) | ||
Non-refundable deposit | $ 19,000 | |
Renown Power Development, Ltd. [Member] | ||
Non-Exclusive Distribution Sublicense with Renown Power Development, Ltd. (Textual) | ||
Non-refundable deposit | $ 500,000 | |
Sublicense fee payment terms | In addition, after Renown receives aggregate cash flow of $10,000,000, it is required to pay the Company 25% of all funds it receives from any and all sources, until it fully pays the contractual licensing fee. | |
Amount of monies required to be received before sublicense fee payments commence | $ 10,000,000 | |
Ownership interest | 25.00% | |
Coates Power [Member] | ||
Non-Exclusive Distribution Sublicense with Renown Power Development, Ltd. (Textual) | ||
Deposit on order for two completed Gen Sets | $ 131,000 |
Inventory (Details)
Inventory (Details) - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Summary of inventory | ||
Raw materials | $ 178,000 | $ 178,000 |
Work-in-process | 13,000 | 13,000 |
Total | $ 191,000 | $ 191,000 |
License Deposits (Details)
License Deposits (Details) - License Deposits [Member] - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
License Deposits (Textual) | ||
License deposit from Renown | $ 498,000 | |
License deposit from Almont | $ 300,000 | |
Term of sublicense deposit | Straight-line basis over the remaining period until expiration of the last remaining CSRV® patent in force in 2027. | |
Aggregate of all revenue recognized related to license deposit from Almont since received | $ 115,000 | |
Licenses fee | 1,000,000 | |
Royalty fee (per engine) | $ 50 | |
License fee, description | As of the date of this filing, the Company had not received a $1,000,000, one-time upfront license fee as required by the agreement and cannot determine when, and if, the fee will be collected. Accordingly, the Company has not recorded a $1,000,000 receivable for the past due upfront license fee or recognized any unpaid amount as revenue related to this license agreement. | |
Percentage of down payment | 50.00% | |
Sublicensing fee revenue | $ 5,000 | $ 5,000 |
Property, Plant and Equipment50
Property, Plant and Equipment (Details) - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Summary of Property, plant and equipment | ||
Property, plant and equipment, Gross | $ 3,028,000 | $ 3,028,000 |
Less: Accumulated depreciation | (940,000) | (952,000) |
Total | 2,065,000 | 2,076,000 |
Land [Member] | ||
Summary of Property, plant and equipment | ||
Property, plant and equipment, Gross | 1,235,000 | 1,235,000 |
Building [Member] | ||
Summary of Property, plant and equipment | ||
Property, plant and equipment, Gross | 964,000 | 964,000 |
Building improvements [Member] | ||
Summary of Property, plant and equipment | ||
Property, plant and equipment, Gross | 83,000 | 83,000 |
Machinery and equipment [Member] | ||
Summary of Property, plant and equipment | ||
Property, plant and equipment, Gross | 689,000 | 689,000 |
Furniture and fixtures [Member] | ||
Summary of Property, plant and equipment | ||
Property, plant and equipment, Gross | $ 57,000 | $ 57,000 |
Property, Plant and Equipment51
Property, Plant and Equipment (Details Textual) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Property, Plant and Equipment (Textual) | ||
Depreciation expense | $ 11,000 | $ 12,000 |
Mortgage Loan Payable (Details)
Mortgage Loan Payable (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Mortgage Loan Payable (Textual) | |||
Maturity date | Jul. 1, 2018 | ||
Mortgage loan payable, interest rate | 7.50% | ||
Interest expense | $ 33,000 | $ 26,000 | |
Mortgage loan payment terms | Monthly payments of interest, plus $5,000 which is being applied to the principal balance. | ||
Periodic payment of principal | $ 5,000 | ||
Principal balance of mortgage loan due | $ 1,318,000 | $ 1,333,000 | |
Number of shares pledged as collateral | Five million |
Finance Lease Obligation (Detai
Finance Lease Obligation (Details) - Finance Lease Obligation [Member] - USD ($) | 1 Months Ended | 3 Months Ended | |
Aug. 31, 2013 | Mar. 31, 2017 | Mar. 31, 2016 | |
Finance Lease Obligation (Textual) | |||
Cash proceeds for research and development and manufacturing equipment | $ 133,000 | ||
Effective Interest rate on lease | 36.60% | ||
Financial lease, interest expense | $ 0 | $ 2,000 |
Accounts Payable and Accrued 54
Accounts Payable and Accrued Liabilities (Details) - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Summary of accounts payable and accrued liabilities | ||
Legal and professional fees | $ 1,475,000 | $ 1,452,000 |
Accrued interest expense | 533,000 | 502,000 |
General and administrative expenses | 528,000 | 392,000 |
Research and development costs | 115,000 | 115,000 |
Total | $ 2,651,000 | $ 2,461,000 |
Promissory Notes to Related P55
Promissory Notes to Related Parties (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Promissory Notes to Related Parties (Textual) | ||
Promissory notes unpaid accrued interest | $ 410,000 | |
George J. Coates [Member] | ||
Promissory Notes to Related Parties (Textual) | ||
Cash proceeds from related party promissory notes | 4,000 | $ 0 |
Repaid promissory notes principal amount | $ 4,000 | 10,000 |
Promissory note interest rate | 17.00% | |
Outstanding balance, including accrued interest | $ 328,000 | |
Promissory notes interest expense | 13,000 | 13,000 |
Gregory G. Coates [Member] | ||
Promissory Notes to Related Parties (Textual) | ||
Promissory notes interest expense | $ 35,000 | 36,000 |
Imputed interest rate on promissory note | 10.00% | |
Outstanding principal balance | $ 1,438,000 | |
Bernadette Coates [Member] | ||
Promissory Notes to Related Parties (Textual) | ||
Cash proceeds from related party promissory notes | 1,000 | 0 |
Repaid promissory notes principal amount | $ 6,000 | 0 |
Promissory note interest rate | 17.00% | |
Outstanding balance, including accrued interest | $ 82,000 | |
Promissory notes interest expense | $ 3,000 | $ 3,000 |
Promissory Note (Details)
Promissory Note (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Dec. 31, 2016 | |
Promissory Note (Textual) | ||
Promissory note issued | $ 25,000 | |
Promissory note matures | May 13, 2017 | |
Promissory note Interest payable unregistered | 10,000,000 | |
Payment fees repaid | 750,000 | |
Lender to purchase of common stock | 10,839,752 | |
Promissory note exercise price | $ 0.0015 | |
Promissory note additional term | P5Y | |
Common stock scheduled expire | 2,017 |
Convertible Promissory Notes 57
Convertible Promissory Notes and Embedded Derivative Liability (Details) - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Financial assets and liabilities measured at fair value | ||
Total | $ 205,000 | $ 153,000 |
Level 1 Inputs [Member] | ||
Financial assets and liabilities measured at fair value | ||
Total | ||
Level 2 Inputs [Member] | ||
Financial assets and liabilities measured at fair value | ||
Total | 205,000 | 153,000 |
Level 3 Inputs [Member] | ||
Financial assets and liabilities measured at fair value | ||
Total |
Convertible Promissory Notes 58
Convertible Promissory Notes and Embedded Derivative Liability (Details Textual) - USD ($) | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Convertible Promissory Notes and Embedded Derivative Liability (Textual) | |||
Volatility rate | 200.00% | ||
Convertible promissory notes [Member] | |||
Convertible Promissory Notes and Embedded Derivative Liability (Textual) | |||
Principal amount | $ 140,000 | ||
Principal amount of convertible notes issued | $ 93,000 | $ 91,000 | |
Conversion price, description for convertible note payable | Outstanding notes may be converted into unregistered shares of the Company's common stock at a discount ranging from 30% to 39% of the defined trading price of the common stock on the date of conversion. | ||
Effective interest rate | 147.00% | ||
Unamortized discount | $ 52,000 | $ 53,000 | |
Principal amount of debt, including accrued interest converted into shares of common stock | 56,000 | 295,000 | |
Loss on conversion of convertible notes | $ 12,000 | $ 26,000 | |
Common shares issued upon conversion of convertible notes | 170,872,980 | 234,920,926 | |
Prepayment option, description | The convertible notes generally become convertible, in whole, or in part, beginning on the six month anniversary of the issuance date and may be prepaid at the option of the Company, generally with a prepayment penalty equal to 50% of the principal amount of the convertible note at any time prior to becoming eligible for conversion. | ||
Common stock reserved for conversion of convertible notes | 2,112,854,710 | ||
Convertible promissory notes [Member] | Maximum [Member] | |||
Convertible Promissory Notes and Embedded Derivative Liability (Textual) | |||
Conversion price discount from defined trading price | 39.00% | ||
Convertible promissory notes [Member] | Minimum [Member] | |||
Convertible Promissory Notes and Embedded Derivative Liability (Textual) | |||
Conversion price discount from defined trading price | 30.00% | ||
Convertible promissory note one [Member] | |||
Convertible Promissory Notes and Embedded Derivative Liability (Textual) | |||
Conversion price, description for convertible note payable | This convertible note also requires that the conversion price be re-measured 23 trading days after the conversion shares are originally delivered. If the re-measured conversion price is lower, then the Company is required to issue additional conversion shares to the noteholder. | ||
Maximum monthly amount that can be converted for convertible note payable in monthly installments | $ 23,000 |
Capital Stock (Details)
Capital Stock (Details) - Series B [Member] | 3 Months Ended |
Mar. 31, 2017shares | |
Number of shares of stock becoming eligible for conversion to shares of common stock by year [Line Items] | |
Total | 16,981,089 |
2017 [Member] | |
Number of shares of stock becoming eligible for conversion to shares of common stock by year [Line Items] | |
Total | 3,373,395 |
2018 [Member] | |
Number of shares of stock becoming eligible for conversion to shares of common stock by year [Line Items] | |
Total | 12,706,904 |
2019 [Member] | |
Number of shares of stock becoming eligible for conversion to shares of common stock by year [Line Items] | |
Total | 900,790 |
George J. Coates [Member] | |
Number of shares of stock becoming eligible for conversion to shares of common stock by year [Line Items] | |
Total | 15,674,047 |
George J. Coates [Member] | 2017 [Member] | |
Number of shares of stock becoming eligible for conversion to shares of common stock by year [Line Items] | |
Total | 3,135,357 |
George J. Coates [Member] | 2018 [Member] | |
Number of shares of stock becoming eligible for conversion to shares of common stock by year [Line Items] | |
Total | 11,766,624 |
George J. Coates [Member] | 2019 [Member] | |
Number of shares of stock becoming eligible for conversion to shares of common stock by year [Line Items] | |
Total | 772,066 |
Gregory G. Coates [Member] | |
Number of shares of stock becoming eligible for conversion to shares of common stock by year [Line Items] | |
Total | 1,216,320 |
Gregory G. Coates [Member] | 2017 [Member] | |
Number of shares of stock becoming eligible for conversion to shares of common stock by year [Line Items] | |
Total | 224,975 |
Gregory G. Coates [Member] | 2018 [Member] | |
Number of shares of stock becoming eligible for conversion to shares of common stock by year [Line Items] | |
Total | 872,014 |
Gregory G. Coates [Member] | 2019 [Member] | |
Number of shares of stock becoming eligible for conversion to shares of common stock by year [Line Items] | |
Total | 119,331 |
Barry C. Kaye [Member] | |
Number of shares of stock becoming eligible for conversion to shares of common stock by year [Line Items] | |
Total | 90,722 |
Barry C. Kaye [Member] | 2017 [Member] | |
Number of shares of stock becoming eligible for conversion to shares of common stock by year [Line Items] | |
Total | 13,063 |
Barry C. Kaye [Member] | 2018 [Member] | |
Number of shares of stock becoming eligible for conversion to shares of common stock by year [Line Items] | |
Total | 68,266 |
Barry C. Kaye [Member] | 2019 [Member] | |
Number of shares of stock becoming eligible for conversion to shares of common stock by year [Line Items] | |
Total | 9,393 |
Capital Stock (Details Textual)
Capital Stock (Details Textual) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Capital Stock (Textual) | ||||
Common stock, authorized shares | 12,000,000,000 | 12,000,000,000 | ||
Common stock, par value | $ 0.0001 | $ 0.0001 | ||
Unregistered shares of common stock issued | 25,000,000 | |||
Unregistered shares of common stock issued, value | $ 25,000 | |||
Registered shares of common stock issued, but not sold | 25,000,000 | |||
Exercise price of common stock warrants sold | $ 0.001 | $ 0.001 | ||
Preferred stock, authorized shares | 100,000,000 | 100,000,000 | ||
Preferred stock, par value | $ 0.001 | $ 0.001 | ||
Pro forma information for Series B Convertible Preferred Stock, Description | Once the conversion restrictions lapse, an additional 16,981,089,000 new restricted shares of common stock would be issued. On a pro forma basis, based on the number of shares of common stock outstanding at March 31, 2017, this would dilute the ownership percentage of non-affiliated stockholders from 81.0% to 12.8%. | |||
Convertible promissory notes one [Member] | ||||
Capital Stock (Textual) | ||||
Pro forma number of shares of common stock potentially issuable upon assumed conversion of convertible promissory notes eligible for conversion | 340,780,432 | |||
Series A Preferred Stock [Member] | ||||
Capital Stock (Textual) | ||||
Preferred stock, par value | $ 0.001 | $ 0.001 | ||
Series A preferred stock, designated shares | 1,000,000 | 1,000,000 | ||
Series A convertible preferred stock, issued shares | 770,222 | 770,222 | ||
Series A Convertible preferred stock, outstanding shares | 50,000 | 50,000 | ||
Description of preferred stock voting rights | Shares of Series A entitle the holder to 10,000 votes per share on all matters brought before the shareholders for a vote. | Shares of Series A entitle the holder to 10,000 votes per share on all matters brought before the shareholders for a vote. | ||
Series B Preferred Stock [Member] | ||||
Capital Stock (Textual) | ||||
Preferred stock, par value | $ 0.001 | $ 0.001 | ||
Series B convertible preferred stock, designated shares | 75,000,000 | 75,000,000 | ||
Series B Convertible preferred stock, issued shares | 16,981,089 | 16,981,089 | ||
Series B Convertible preferred stock, outstanding shares | 16,252,584 | 16,252,584 | ||
Number shares of Common Stock into which each share of Series B Convertible Preferred Stock can be converted | 1,000 | 1,000 | ||
Description of preferred stock voting rights | Holders of Series B are entitled to one thousand votes per share held, on all matters brought before the shareholders for a vote. | Holders of Series B are entitled to one thousand votes per share held, on all matters brought before the shareholders for a vote. | ||
Percentage of non - affiliate shareholder ownership before assumed conversion | 81.00% | |||
Percentage of non - affiliate shareholder ownership after assumed conversion | 12.80% | |||
Series B [Member] | ||||
Capital Stock (Textual) | ||||
Conversion of promissory notes | 16,981,089 | |||
Convertible promissory note [Member] | ||||
Capital Stock (Textual) | ||||
Common shares issued upon conversion of convertible promissory notes | 170,872,980 | 234,920,926 | ||
Principal amount of debt, including accrued interest converted into shares of common stock | $ 56,000 | $ 295,000 | ||
Unregistered, restricted shares of common stock | 170,872,980 | |||
Principal amount | $ 140,000 | |||
George J. Coates [Member] | Series A Preferred Stock [Member] | ||||
Capital Stock (Textual) | ||||
Series A convertible preferred stock, issued shares | 670,219 | |||
Percentage of eligible votes | 85.70% | |||
George J. Coates [Member] | Series B Preferred Stock [Member] | ||||
Capital Stock (Textual) | ||||
Series B convertible preferred stock, issued shares | 772,066 | 1,263,978 | ||
Fixed ownership percentage | 80.63% | |||
Estimated fair value of Series B convertible preferred stock granted | $ 132,000 | $ 1,641,000 | ||
George J. Coates [Member] | Series B [Member] | ||||
Capital Stock (Textual) | ||||
Conversion of promissory notes | 15,674,047 | |||
Gregory G. Coates [Member] | Series B Preferred Stock [Member] | ||||
Capital Stock (Textual) | ||||
Series B convertible preferred stock, issued shares | 119,315 | 86,048 | ||
Fixed ownership percentage | 6.10% | |||
Estimated fair value of Series B convertible preferred stock granted | $ 39,000 | $ 112,000 | ||
Gregory G. Coates [Member] | Series B [Member] | ||||
Capital Stock (Textual) | ||||
Conversion of promissory notes | 1,216,320 | |||
Barry C. Kaye [Member] | Series B Preferred Stock [Member] | ||||
Capital Stock (Textual) | ||||
Series B convertible preferred stock, issued shares | 9,393 | 6,736 | ||
Fixed ownership percentage | 0.048% | |||
Shares of convertible securities | 1,372 | |||
Estimated fair value of Series B convertible preferred stock granted | $ 3,000 | $ 9,000 | ||
Unregistered, restricted shares of common stock | 1,372,000 | |||
Barry C. Kaye [Member] | Series B [Member] | ||||
Capital Stock (Textual) | ||||
Conversion of promissory notes | 90,722 | |||
Southridge Partners II LP [Member] | ||||
Capital Stock (Textual) | ||||
Registered shares of common stock sold, shares | 37,234,002 | |||
Registered shares of common stock sold, value | $ 100,000 | |||
Mr. Coates [Member] | Series B [Member] | ||||
Capital Stock (Textual) | ||||
Conversion of promissory notes | 115,006 | |||
Mr. Coates [Member] | Convertible promissory note [Member] | ||||
Capital Stock (Textual) | ||||
Stock Issued During Period, Shares, Acquisitions | 211,318,358 | |||
Principal amount | $ 157,000 |
Unearned Revenue (Details)
Unearned Revenue (Details) | Mar. 31, 2017USD ($) |
Unearned Revenue (Textual) | |
Deposit received for sale | $ 131,000 |
Non-refundable deposit | $ 19,000 |
Sublicensing Fee Revenue (Detai
Sublicensing Fee Revenue (Details) - Sublicensing Fee Revenue [Member] - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Sublicensing Fee Revenue (Textual) | ||
Sublicensing fee revenue | $ 5,000 | $ 5,000 |
License deposit | $ 300,000 | |
Amortization method, description | Straight-line basis over the approximate remaining life until 2027 |
Loss Per Share (Details)
Loss Per Share (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Loss Per Share (Textual) | ||
Warrants outstanding to purchase common stock | 150,344,911 | 60,344,911 |
Vested stock options outstanding | 12,470,000 | 12,470,000 |
Exercise prices, description | Stock warrants outstanding to purchase 150,344,911 shares of common stock at exercise prices ranging from $0.0005 to $0.675 per share. | Stock warrants outstanding to purchase 60,344,911 shares of common stock at exercise prices ranging from $0.001 to $0.12 per share. |
Convertible promissory notes [Member] | ||
Loss Per Share (Textual) | ||
Convertible promissory notes outstanding, eligible for conversion | $ 72,000 | $ 252,000 |
Pro forma number of common shares issuable upon assumed conversion of promissory notes | 340,780,432 | 244,775,045 |
Maximum [Member] | ||
Loss Per Share (Textual) | ||
Stock option exercise price | $ 0.44 | $ 0.44 |
Minimum [Member] | ||
Loss Per Share (Textual) | ||
Stock option exercise price | $ 0.028 | $ 0.028 |
Stock Options (Details)
Stock Options (Details) - Stock Option [Member] | 3 Months Ended |
Mar. 31, 2017$ / sharesshares | |
Stock options outstanding under stock option plan | |
Number Outstanding | shares | 12,470,000 |
Weighted Average Remaining Contractual Life | 10 years |
Number Exercisable | shares | 12,470,000 |
Weighted Average Exercise Price | $ 0.182 |
Weighted Average Fair Value Per Stock Option at Date of Grant | 0.169 |
Maximum [Member] | |
Stock options outstanding under stock option plan | |
Exercise Price Per Share | 0.44 |
Minimum [Member] | |
Stock options outstanding under stock option plan | |
Exercise Price Per Share | $ 0.028 |
Stock Options (Details 1)
Stock Options (Details 1) | 3 Months Ended | |
Mar. 31, 2017 | ||
Summary of assumptions used to determine weighted average fair value | ||
Historical stock price volatility, minimum | 139.00% | [1] |
Historical stock price volatility, maximum | 325.00% | [1] |
Risk-free interest rate, minimum | 0.21% | [2] |
Risk-free interest rate, maximum | 4.64% | [2] |
Expected life (in years) | 4 years | [3] |
Dividend yield | 0.00% | [4] |
[1] | Historical stock price volatility: The Company utilized the volatility in the trading of its common stock computed for the 12 months of trading immediately preceding the date of grant. | |
[2] | Risk-free interest rate: The Company bases the risk-free interest rate on the interest rate payable on U.S. Treasury securities in effect at the time of the grant for a period that is commensurate with the assumed expected option life. | |
[3] | Expected life: The expected life of the options represents the period of time options are expected to be outstanding. The Company has very limited historical data on which to base this estimate. Accordingly, the Company estimated the expected life based on its assumption that the executives will be subject to frequent blackout periods during the time that the stock options will be exercisable and based on the Company's expectation that it will complete its research and development phase and commence its initial production phase. The vesting period of these options was also considered in the determination of the expected life of each stock option grant. | |
[4] | No expected dividends. |
Stock Options (Details Textual)
Stock Options (Details Textual) | 3 Months Ended |
Mar. 31, 2017shares | |
Stock Options (Textual) | |
Historical stock price volatility description | The Company utilized the volatility in the trading of its common stock computed for the 12 months of trading immediately preceding the date of grant. |
2014 Stock Option and Incentive Plan [Member] | |
Stock Options (Textual) | |
Common stock available for stock options or awards under the Stock Plan | 50,000,000 |
Maximum percentage of shares issuable in one year to one employee | 25.00% |
Maximum number of shares of common stock authorized for issue under plan | 50,000,000 |
Equity Purchase and Registrat67
Equity Purchase and Registration Rights Agreements (Details) - Equity Purchase Agreement [Member] - USD ($) | 1 Months Ended | 3 Months Ended | ||
Dec. 31, 2016 | Jul. 31, 2015 | Mar. 31, 2017 | Mar. 31, 2016 | |
Equity Purchase and Registration Rights Agreements (Textual) | ||||
Number of shares of common stock registered | 205,000,000 | |||
Southridge Partners II LP [Member] | ||||
Equity Purchase and Registration Rights Agreements (Textual) | ||||
Number of shares of common stock sold | 37,234,042 | |||
2015 equity purchase agreement description | Pursuant to the terms of the EP Agreement, Southridge committed to purchase up to 205,000,000 shares of the Company's common stock at 94% of the lowest closing price of the common stock during the ten trading days that comprise the defined pricing period. In December 2016, the EP Agreement automatically terminated because Southridge had purchased all 205,000,000 registered shares of common stock under the EP Agreement. | |||
Number of shares of common stock registered | 205,000,000 | |||
Proceeds from issuance of common stock under equity line of credit | $ 100,000 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Income Taxes (Textual) | ||
Increase in deferred tax assets | $ 209,000 | $ 833,000 |
Open income tax years, Description | 2013 through 2015. | |
Federal [Member] | ||
Income Taxes (Textual) | ||
Operating loss carryforwards | $ 20,793,000 | |
Operating loss carryforwards expiration date description | Expiring between 2018 and 2037. | |
State [Member] | ||
Income Taxes (Textual) | ||
Operating loss carryforwards | $ 10,969,000 | |
Operating loss carryforwards expiration date description | Expiring between 2029 and 2037. |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | ||
George J. Coates [Member] | |||
Summary of approximate amount of base compensation and benefits | |||
Base compensation and benefits paid | [1],[2],[3] | $ 14,000 | $ 3,000 |
Gregory G. Coates [Member] | |||
Summary of approximate amount of base compensation and benefits | |||
Base compensation and benefits paid | [4],[5] | 3,000 | 40,000 |
Bernadette Coates [Member] | |||
Summary of approximate amount of base compensation and benefits | |||
Base compensation and benefits paid | [6] | $ 1,000 | $ 1,000 |
[1] | During the three months ended March 31, 2017 and 2016, George J. Coates was awarded 772,066 and 1,263,978 shares of Series B Convertible Preferred Stock, respectively, with an estimated fair value of $199,000 and $1,641,000, respectively, for anti-dilution. | ||
[2] | During the three months ended March 31, 2017, George J. Coates was awarded 670,222 shares of Series A Preferred Stock with an estimated fair value of $17,000, for anti-dilution. | ||
[3] | For the three months ended March 31, 2017 and 2016, George J. Coates earned additional base compensation of $53,000 and $63,000, respectively, payment of which is being deferred until the Company has sufficient working capital. These amounts are included in deferred compensation in the accompanying balance sheets at March 31, 2017 and December 31, 2016. | ||
[4] | During the three months ended March 31, 2017 and 2016, Gregory G. Coates was awarded 119,331 and 86,048 shares of Series B Convertible Preferred Stock, respectively, with an estimated fair value of $39,000 and $112,000, respectively, for anti-dilution. | ||
[5] | For the three months ended March 31, 2017 and 2016, Gregory G. Coates earned additional base compensation of $38,000 and $-0-, respectively, payment of which is being deferred until the Company has sufficient working capital. These amounts are included in deferred compensation in the accompanying balance sheets at March 31, 2017 and December 31, 2016. | ||
[6] | For the three months ended March 31, 2017 and 2016, Bernadette Coates earned additional base compensation of $17,000 and $17,000, respectively, payment of which is being deferred until the Company has sufficient working capital. These amounts are included in deferred compensation in the accompanying balance sheets at March 31, 2017 and December 31, 2016. |
Related Party Transactions (D70
Related Party Transactions (Details Textual) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
George J. Coates [Member] | ||
Related Party Transactions (Textual) | ||
Amount of compensation deferred | $ 53,000 | $ 63,000 |
George J. Coates [Member] | Series A Preferred Stock [Member] | ||
Related Party Transactions (Textual) | ||
Shares of series A preferred stock issued | 670,222 | |
Fair value of series A preferred stock issued | $ 17,000 | |
George J. Coates [Member] | Series B Preferred Stock [Member] | ||
Related Party Transactions (Textual) | ||
Issuance of anti-dilution shares of Series B convertible preferred stock to related parties, shares | 772,066 | 1,263,978 |
Value of anti-dilution shares of series B convertible preferred stock issued to related parties | $ 199,000 | $ 1,641,000 |
Gregory G. Coates [Member] | ||
Related Party Transactions (Textual) | ||
Amount of compensation deferred | $ 38,000 | $ 0 |
Gregory G. Coates [Member] | Series B Preferred Stock [Member] | ||
Related Party Transactions (Textual) | ||
Issuance of anti-dilution shares of Series B convertible preferred stock to related parties, shares | 119,331 | 86,048 |
Value of anti-dilution shares of series B convertible preferred stock issued to related parties | $ 39,000 | $ 112,000 |
Bernadette Coates [Member] | ||
Related Party Transactions (Textual) | ||
Amount of compensation deferred | 17,000 | 17,000 |
Barry C. Kaye [Member] | ||
Related Party Transactions (Textual) | ||
Amount of compensation paid Treasurer and Chief Financial Officer | $ 10,000 | $ 0 |
Issuance of anti-dilution shares of Series B convertible preferred stock to related parties, shares | 9,393 | 6,736 |
Value of anti-dilution shares of series B convertible preferred stock issued to related parties | $ 3,000 | $ 9,000 |
Compensation earned by Barry C. Kaye, but not paid | 32,000 | $ 23,000 |
Total amount of unpaid, deferred compensation | 11,000 | |
Interest expense related party | $ 343,000 |
Contractual Obligations and C71
Contractual Obligations and Commitments (Details) | Mar. 31, 2017USD ($) |
Summary of Company's contractual obligations | |
2,017 | $ 3,046,000 |
2,018 | 1,281,000 |
Total | 4,327,000 |
Promissory notes to related parties [Member] | |
Summary of Company's contractual obligations | |
2,017 | 1,450,000 |
2,018 | |
Total | 1,450,000 |
Mortgage loan payable [Member] | |
Summary of Company's contractual obligations | |
2,017 | 60,000 |
2,018 | 1,258,000 |
Total | 1,318,000 |
Deferred compensation [Member] | |
Summary of Company's contractual obligations | |
2,017 | 1,394,000 |
2,018 | |
Total | 1,394,000 |
Convertible promissory notes [Member] | |
Summary of Company's contractual obligations | |
2,017 | 117,000 |
2,018 | 23,000 |
Total | 140,000 |
Promissory Note [Member] | |
Summary of Company's contractual obligations | |
2,017 | 25,000 |
2,018 | |
Total | $ 25,000 |
Subsequent Events (Details)
Subsequent Events (Details) - Subsequent Events [Member] - USD ($) | Apr. 13, 2017 | May 09, 2017 | May 05, 2017 |
George J. Coates [Member] | |||
Subsequent Event [Line Items] | |||
Total aggregate deferred compensation | $ 1,061,000 | ||
Total deferred compensation | 28,000 | ||
Gregory G. Coates [Member] | |||
Subsequent Event [Line Items] | |||
Total aggregate deferred compensation | 87,000 | ||
Total deferred compensation | 17,000 | ||
Barry C. Kaye [Member] | |||
Subsequent Event [Line Items] | |||
Total aggregate deferred compensation | 224,000 | ||
Total deferred compensation | 14,000 | ||
Bernadette Coates [Member] | |||
Subsequent Event [Line Items] | |||
Total aggregate deferred compensation | 283,000 | ||
Total deferred compensation | 8,000 | ||
Mr. Kaye [Member] | |||
Subsequent Event [Line Items] | |||
Total aggregate deferred compensation | 15,000 | ||
Convertible Promissory Note [Member] | |||
Subsequent Event [Line Items] | |||
Total amount of convertible notes issued | 109,000 | ||
Convertible promissory notes principal amount after transaction costs | $ 304,000 | ||
Convertible Promissory Note [Member] | Minimum [Member] | |||
Subsequent Event [Line Items] | |||
Conversion price, description | A conversion price ranging from 61% to 65% of the trading price. | ||
Convertible Promissory Note [Member] | Maximum [Member] | |||
Subsequent Event [Line Items] | |||
Conversion price, description | The conversion price of the back-end notes ranged from 62% to 70% of the trading price. | ||
Convertible Promissory Notes One [Member] | |||
Subsequent Event [Line Items] | |||
Unregistered shares of common stock issued upon conversion | 960,097,696 | ||
Total amount of convertible notes converted to common stock | $ 226,000 | ||
Promissory Note [Member] | |||
Subsequent Event [Line Items] | |||
Unregistered shares of common stock issued upon conversion | 8,688,525 | ||
Interest rate | 25.00% | ||
Total amount of convertible notes issued | $ 5,000 | ||
Repaid promissory notes | $ 25,000 | ||
Promissory Note [Member] | George J. Coates [Member] | |||
Subsequent Event [Line Items] | |||
Interest rate | 17.00% | ||
Total amount of convertible notes issued | $ 16,000 | ||
Repaid promissory notes | 25,000 | ||
Repaid promissory notes interest | $ 6,000 | ||
Promissory Note [Member] | Bernadette Coates [Member] | |||
Subsequent Event [Line Items] | |||
Interest rate | 17.00% | ||
Total amount of convertible notes issued | $ 23,000 | ||
Repaid promissory notes | $ 10,000 | ||
Series B Convertible Preferred Stock [Member] | George J. Coates [Member] | |||
Subsequent Event [Line Items] | |||
Shares of Series B Preferred Stock issued | 3,409,590 | ||
Fair value of Series B Preferred Stock issued | $ 1,125,000 | ||
Series B Convertible Preferred Stock [Member] | Gregory G. Coates [Member] | |||
Subsequent Event [Line Items] | |||
Shares of Series B Preferred Stock issued | 258,091 | ||
Fair value of Series B Preferred Stock issued | $ 85,000 | ||
Series B Convertible Preferred Stock [Member] | Barry C. Kaye [Member] | |||
Subsequent Event [Line Items] | |||
Shares of Series B Preferred Stock issued | 20,205 | ||
Fair value of Series B Preferred Stock issued | $ 7,000 |