Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2015 | Aug. 14, 2015 | |
Document And Entity Information | ||
Entity Registrant Name | FLUOROPHARMA MEDICAL, INC. | |
Entity Central Index Key | 1,402,785 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2015 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Is Entity a Well-known Seasoned Issuer? | No | |
Is Entity a Voluntary Filer? | No | |
Is Entity's Reporting Status Current? | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 29,743,580 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2,015 | |
Trading Symbol | FPMI |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Current Assets: | ||
Cash and cash equivalents | $ 42,042 | $ 252,145 |
Investment in trading securities | 39,930 | |
Prepaid expenses & other | $ 132,281 | 158,849 |
Total Current Assets | 174,323 | 450,924 |
Property and equipment, net | 6,651 | 11,727 |
Intangible assets, net | 338,043 | 357,540 |
Total Assets | 519,017 | 820,191 |
Current Liabilities: | ||
Convertible notes payable - short term (see Note 4) | 2,713,416 | 2,123,416 |
Accounts payable | 1,671,111 | 1,064,480 |
Derivative warrant liability | 1,628,343 | 1,354,319 |
Accrued expenses & other | 1,402,851 | 1,074,611 |
Total Current Liabilities | 7,415,721 | 5,616,826 |
Stockholders' Equity (Deficit): | ||
Common stock - Class A - $0.001 par value, 100,000,000 shares authorized, 29,527,187 and 29,197,497 shares issued and outstanding at June 30, 2015 and December 31, 2014, respectively. | 29,528 | 29,199 |
Additional paid-in capital | 24,223,596 | 24,034,203 |
Accumulated deficit | (31,156,336) | (28,866,683) |
Total Stockholders' Deficit | (6,896,704) | (4,796,635) |
Total Liabilities and Stockholders' Deficit | 519,017 | 820,191 |
Series A Preferred Stock [Member] | ||
Stockholders' Equity (Deficit): | ||
Preferred stock Series A; $0.001 par value, 3,500,000 shares designated 811,148 and 949,477 shares issued and outstanding at June 30, 2015 and December 31, 2014, respectively; Series B; $0.001 par value, 12,000,000 shares designated 5,694,571 shares issued and outstanding at June 30, 2015 and December 31, 2014 | 813 | 951 |
Series B Preferred Stock [Member] | ||
Stockholders' Equity (Deficit): | ||
Preferred stock Series A; $0.001 par value, 3,500,000 shares designated 811,148 and 949,477 shares issued and outstanding at June 30, 2015 and December 31, 2014, respectively; Series B; $0.001 par value, 12,000,000 shares designated 5,694,571 shares issued and outstanding at June 30, 2015 and December 31, 2014 | $ 5,695 | $ 5,695 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Jun. 30, 2015 |
Preferred stock,designated | 100,000,000 |
Common stock, par value | $ .001 |
Common stock, Authorized | 100,000,000 |
Common stock, shares issued | 29,527,187 |
Common stock, shares outstanding | 29,527,187 |
Series A Preferred Stock [Member] | |
Preferred stock, par value | $ .001 |
Preferred stock,designated | 3,500,000 |
Preferred stock, shares issued | 811,148 |
Preferred stock, shares outstanding | 811,148 |
Preference in liquidation | $ 673,253 |
Series B Preferred Stock [Member] | |
Preferred stock, par value | $ .001 |
Preferred stock,designated | 12,000,000 |
Preferred stock, shares issued | 5,694,571 |
Preferred stock, shares outstanding | 5,694,571 |
Preference in liquidation | $ 5,392,747 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Operating Expenses: | ||||
General and administrative | $ 602,386 | $ 947,387 | $ 1,281,022 | $ 1,842,235 |
Research and development | 102,801 | 266,907 | 285,206 | 591,494 |
Total Operating Expenses | 705,187 | 1,214,294 | 1,566,228 | 2,433,729 |
Loss from Operations | $ (705,187) | (1,214,294) | $ (1,566,228) | (2,433,729) |
Other Income (Expense): | ||||
Loss on disposition of intangible assets | (16,591) | (16,591) | ||
Loss on sale of trading securities | (118,518) | $ (11,946) | (302,116) | |
Unrealized gain on trading securities | 94,404 | 7,986 | 236,143 | |
Loss on revaluation of derivative warrant liability | $ (642,031) | (642,047) | (274,024) | (706,967) |
Interest and other expense, net | (80,822) | (282) | (157,924) | (608) |
Total Other Expense, net | (722,853) | (683,034) | (435,908) | (790,139) |
Loss Before Provision for Income Taxes | $ (1,428,040) | $ (1,897,328) | $ (2,002,136) | $ (3,223,868) |
Provision for Income Taxes | ||||
Net Loss | $ (1,428,040) | $ (1,897,328) | $ (2,002,136) | $ (3,223,868) |
Preferred Stock Dividend | (144,622) | (134,159) | (287,517) | (279,953) |
Net Loss Attributable to Common Stockholders | $ (1,572,662) | $ (2,031,487) | $ (2,289,653) | $ (3,503,821) |
Net loss per common share - Basic and Diluted | $ (0.05) | $ (0.07) | $ (0.08) | $ (0.12) |
Weighted Average Shares Used in per Share Calculation - Basic and Diluted | 29,430,742 | 28,947,241 | 29,328,418 | 28,117,277 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | Jul. 02, 2015 | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||
Net loss | $ (1,428,040) | $ (1,897,328) | $ (2,002,136) | $ (3,223,868) | ||
Adjustments to reconcile net loss to net cash used by operating activities | ||||||
Depreciation and amortization | 24,573 | $ 15,313 | ||||
Amortization of issuance costs | $ 60,486 | |||||
Fair value of common stock issued for consulting | $ 178,160 | |||||
Share-based compensation related to employee stock options | $ 150,570 | 236,953 | ||||
Loss on intangible asset dispositions | 16,591 | |||||
Net loss on sale of trading securities | $ 11,946 | 302,116 | ||||
Change in unrealized gain (loss) on trading securities | (7,986) | (236,143) | ||||
Loss on revaluation and modification of derivative warrant liability | 274,024 | 706,967 | ||||
(Increase) decrease in: | ||||||
Prepaid expenses & other | 20,897 | (103,818) | ||||
Increase (decrease) in: | ||||||
Accounts payable | 606,631 | 586,100 | ||||
Accrued expenses & other | 79,737 | (26,278) | ||||
Net Cash Used in Operating Activities | (781,258) | (1,547,907) | ||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||
Proceeds from sale of investments | $ 35,970 | 568,852 | ||||
Cash paid for intangible assets | (350,000) | |||||
Cash paid for purchase of property and equipment | (6,564) | |||||
Net Cash Provided by Investing Activities | $ 35,970 | $ 212,288 | ||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||
Proceeds from issuance of convertible notes payable - short term | 600,000 | |||||
Notes payable issuance costs | (54,815) | |||||
Repayment of notes payable | $ (3,542) | $ (10,000) | ||||
Proceeds from the exercise of stock warrants | $ 90,375 | |||||
Proceeds from sale of common stock, net | 203,055 | |||||
Net Cash Provided by Financing Activities | $ 535,185 | 293,430 | ||||
Net Decrease in Cash and Cash Equivalents | (210,103) | (1,042,189) | ||||
Cash and Cash Equivalents, Beginning of Period | $ 42,042 | 252,145 | 1,143,175 | $ 1,143,175 | ||
Cash and Cash Equivalents, End of Period | $ 42,042 | $ 100,986 | $ 42,042 | $ 100,986 | $ 252,145 | |
Supplemental Cash Flow Disclosures: | ||||||
Interest expense paid in cash | ||||||
Tax paid | $ 1,683 | |||||
Supplemental Non-Cash Disclosure: | ||||||
Fair value of warrants modified in connection with Series B financing | (114,923) | |||||
Fair value of warrants issued to Series B placement agents | (12,738) | |||||
Series B Preferred Stock dividends accrued | $ (248,503) | (225,219) | ||||
Series A Preferred Stock dividend | (34,685) | (38,666) | ||||
Conversion of Series A Preferred Stock dividend to Common Stock | $ (4,329) | (16,068) | ||||
Conversion of Series A preferred shares to Common Stock | (1,254) | |||||
Conversion of preferred shares and accrued dividends to Common Stock | $ (1,254) | |||||
Series B Preferred Stock [Member] | ||||||
Supplemental Non-Cash Disclosure: | ||||||
Conversion of Series A Preferred Stock dividend to Common Stock | $ (1,220) | |||||
Conversion of Series A preferred shares to Common Stock | (75) | $ (1,373) | ||||
Conversion of preferred shares and accrued dividends to Common Stock | $ (75) | $ (1,373) |
ORGANIZATION, BASIS OF PRESENTA
ORGANIZATION, BASIS OF PRESENTATION AND GOING CONCERN | 6 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
ORGANIZATION, BASIS OF PRESENTATION AND GOING CONCERN | FluoroPharma Medical, Inc., a Nevada corporation (the Company), is a molecular imaging company headquartered in Montclair, N.J. The Company was founded as FluoroPharma Inc. in 2003 to engage in the discovery, development and commercialization of proprietary products for the positron emission tomography (PET) market. The Companys initial focus has been on the development of novel cardiovascular imaging agents that can more efficiently and effectively detect and assess acute and chronic forms of coronary artery disease (CAD). Molecular imaging pharmaceuticals are radiopharmaceuticals that enable early detection of disease through the visualization of subtle changes in biochemical and biological processes. The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, FluoroPharma, Inc., a Delaware corporation. All intercompany transactions have been eliminated in consolidation. Basis of Presentation The accompanying unaudited condensed consolidated financial statements of FluoroPharma Medical, Inc. and Subsidiary have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) for interim financial information and the rules and regulations of the U.S. Securities and Exchange Commission (the "SEC"). Accordingly, the unaudited condensed consolidated financial statements do not include all information and footnotes required by U.S. GAAP for complete annual financial statements. In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments, consisting of only normal recurring adjustments, considered necessary for a fair presentation. Certain prior year amounts in the condensed consolidated financial statements and notes thereto have been reclassified to conform to the current periods presentation. Interim operating results are not necessarily indicative of results that may be expected for the year ending December 31, 2015 or for any other interim period. The unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements of the Company and the notes thereto as of and for the year ended December 31, 2014, as included in the Company's Form 10-K filed with the SEC on March 31, 2015. Going concern The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has experienced net losses and negative cash flows from operations since its inception. The Company has sustained cumulative losses attributable to common stockholders of $31,156,336 as of June 30, 2015. The Company has historically financed its operations through issuances of equity and the proceeds of debt instruments. In the past, the Company has also provided for its cash needs by issuing common stock, options and warrants for certain operating costs, including consulting and professional fees. During the six months ended June 30, 2015, the Company raised net cash proceeds of $545,185 through the issuance of notes payable. In addition, during the six months ended June 30, 2015, the Company received gross proceeds of $35,970 from the sale of freely tradable securities received pursuant to the issuance and sale in a private placement of promissory notes (see Note 4). During the year ended December 31, 2014, the Company raised net cash of $2,243,102 through the issuance of notes payable, the sale of common stock and the exercise of warrants. Additionally, the Company received cash proceeds of $568,852 from the sale of freely tradable securities received as consideration in the Companys 2013 private placement of its Series B Preferred Stock. The Company continues to actively pursue various funding options, including equity offerings, to obtain additional funds to continue the development of its products and bring them to commercial markets. Management continues to assess fund raising opportunities to ensure minimal dilution to its existing shareholder base and to obtain the best price for its securities. Management is optimistic based upon its ability to raise funds in prior years, through private placement offerings, that it will be able to raise additional funds in the future. If the Company is unable to raise additional capital as may be needed to meet its projections for operating expenses, it could have a material adverse effect on liquidity or require the Company to cease or significantly delay some of its clinical trials. These financial statements do not include any adjustments relating to the recoverability of recorded asset amounts that might be necessary as a result of the above uncertainty. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2015 | |
Notes to Financial Statements | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | Investments Investments that are purchased and held principally for the purpose of selling them in the near term are classified as trading securities and reflected on the balance sheet at fair value, with unrealized gains and losses included in earnings. All the Companys investments are considered trading securities at December 31, 2014. During the six months ended June 30, 2015, the Company sold all investments and received cash proceeds of $35,970. The Company recorded realized losses of $11,946 upon the sale. Intangible Assets The Companys intangible assets consist of technology licenses and are carried at the legal cost to obtain them. Intangible assets are amortized using the straight-line method over the estimated useful life. Useful lives on technology licenses are 5 to 15 years. Fair Value of Financial Instruments The Company groups its assets and liabilities measured at fair value, in three levels based on the markets in which the assets and liabilities are traded and the reliability of the assumptions used to determine fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). Financial instruments with readily available active quoted prices or for which fair value can be measured from actively quoted prices generally will have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value. The three levels of the fair value hierarchy are as follows: Level 1 Valuation is based on quoted prices in active markets for identical assets or liabilities. Valuations are obtained from readily available pricing sources for market transactions involving identical assets or liabilities. Level 2 Valuation is based on observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 Valuation is based on unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an instruments level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The Companys assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the financial instrument. The Company recognizes transfers between levels at the end of the reporting period as if the transfers occurred on the last day of the reporting period. Assets and liabilities measured at fair value on a recurring basis at June 30, 2015 are summarized below: June 30, 2015 Level 1 Level 2 Level 3 Fair Value Current Liabilities: Derivative warrant liability $ - $ - $ 1,628,343 $ 1,628,343 Assets and liabilities measured at fair value on a recurring basis at December 31, 2014 are summarized below: December 31, 2014 Level 1 Level 2 Level 3 Fair Value Current Assets: Trading securities $ 39,930 $ - $ - $ 39,930 Current Liabilities: Derivative warrant liability $ - $ - $ 1,354,319 $ 1,354,319 The following table sets forth the changes in the estimated fair value for our Level 3 classified derivative warrant liability: Six Months Ended Six Months Ended June 30, 2015 June 30, 2014 Fair value at beginning of period $ 1,354,319 $ 2,549,196 Modification and reclassification of outstanding warrants - 114,923 Change in fair value 274,024 625,165 Fair value at end of period $ 1,628,343 $ 3,289,284 Recently Issued Accounting Standards In April 2015, the Financial Accounting Standards Board (the FASB) issued Accounting Standards Update (ASU) 2015-03, 'Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. ASU 2015-03 is intended to simplify the presentation of debt issuance costs. These amendments require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by the amendments in this ASU. This new guidance is effective for fiscal years beginning after December 15, 2015 and interim periods within those fiscal years. Early adoption is permitted. The Company is currently in the process of evaluating the impact of the adoption of this ASU on the financial statements. In January 2015, FASB issued ASU 2015-01 Income Statement - Extraordinary and Unusual Items (Subtopic 225-20): Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items. This ASU removes the concept of an extraordinary item. Subtopic 225-20, Income Statement - Extraordinary and Unusual Items, required that an entity separately classify, present, and disclose extraordinary events and transactions. Presently, an event or transaction is presumed to be an ordinary and usual activity of the reporting entity unless evidence clearly supports its classification as an extraordinary item. If an event or transaction meets the criteria for extraordinary classification, an entity is required to segregate the extraordinary item from the results of ordinary operations and show the item separately in the income statement, net of tax, after income from continuing operations. The entity also is required to disclose applicable income taxes and either present or disclose earnings-per-share data applicable to the extraordinary item. The amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015. Early adoption is permitted provided that the guidance is applied from the beginning of the fiscal year of adoption. The Company is currently in the process of evaluating the impact of the adoption of this ASU on the financial statements. |
OTHER BALANCE SHEET INFORMATION
OTHER BALANCE SHEET INFORMATION | 6 Months Ended |
Jun. 30, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
OTHER BALANCE SHEET INFORMATION | Components of selected captions in the accompanying balance sheets as of June 30, 2015 and December 31, 2014 consist of: June 30, 2015 December 31, 2014 Prepaid expenses & other: Prepaid insurance $ 20,196 $ 24,576 Deferred closing costs 78,269 83,941 Other 33,816 50,332 Prepaid expenses & other $ 132,281 $ 158,849 Accrued expenses and other: Professional fees $ 28,695 $ 47,028 Accrued dividends Series B Preferred Stock 837,090 588,588 Deferred salary 88,958 63,542 Accrued interest on Note Payable 150,403 53,749 Research and development 67,803 170,292 Other 229,902 151,412 Accrued expenses and other $ 1,402,851 $ 1,074,611 |
CONVERTIBLE NOTES PAYABLE _ SHO
CONVERTIBLE NOTES PAYABLE – SHORT TERM | 6 Months Ended |
Jun. 30, 2015 | |
Debt Disclosure [Abstract] | |
CONVERTIBLE NOTES PAYABLE – SHORT TERM | 2014 Convertible Notes Payable In July, November and December 2014, the Company issued promissory notes (the Notes) pursuant to a Note Purchase Agreement entered into with certain accredited investors for an aggregate principal amount of approximately $1,998,500, $47,916 of which was received by the Company in marketable securities. The Notes mature one year from the date of issuance and bear interest at the rate of 8% per annum. All principal and accrued interest under the Notes will automatically convert into the Companys next equity or equity-linked financings (a Subsequent Financing) in accordance with the following formula: (outstanding balance of the Notes as of the closing of the Subsequent Financing) x (1.15) / (the per security price of the securities sold in the Subsequent Financing). The investors shall be considered to be purchasers in the Subsequent Financing by way of their converted Notes. In addition, upon the closing of a Subsequent Financing, each of the investors shall be issued, in addition to any warrants issued in connection with a Subsequent Financing, an additional warrant to purchase a number of shares of common stock equal to fifty percent (50%) of the number of shares of common stock purchased by such investor in the Subsequent Financing assuming a per share purchase price of the securities to be issued in the Subsequent Financing. In March 2015, the Company issued additional Notes for an aggregate principal amount of $200,000. In connection with the issuance of the 2015 Convertible Notes (as defined and discussed below), the holders of Notes, in the outstanding principal amount of $2,198,416, amended their Notes to (i) extend the maturity date an additional six months, (ii) change the terms of the conversion premium from 1.15 to 1.25 to be consistent with conversion terms of the newly issued convertible notes payable, and (iii) provide that the issuance of promissory notes by the Company in a transaction with a substantially similar structure to the transactions contemplated by the Notes shall not be deemed a Subsequent Financing. In addition, in September 2014, the Company issued a promissory note to a shareholder in the principal amount of $150,000. Interest accrues on the note at a rate of 12% per annum in the event this note is repaid upon maturity on December 31, 2014; otherwise interest accrues at a rate of 16% per annum. As of June 30, 2015, the Company accrued $17,707 in interest expense. As of June 30, 2015, the outstanding balance of this note of $115,000 is included in convertible notes payable - short term in the condensed balance sheets. 2015 Convertible Notes Payable On May 28, 2015, the Company accepted subscriptions pursuant to a new Note and Warrant Purchase Agreement, as amended on August 6, 2015, for the issuance and sale in a private placement of up to $3,000,000 of convertible promissory notes (the Convertible Notes). The Convertible Notes mature one year from the date of issuance and bear interest at the rate of 8% per annum. All principal and accrued interest under the Convertible Notes will, at the sole option of the investor (i) convert into the Companys next equity or equity-linked financing in which the Company raises gross proceeds of at least $3,600,000 (the Subsequent Financing), into such securities, including warrants of the Company as are issued in the Subsequent Financing, the amount of which shall be determined in accordance with the following formula: (the outstanding balance of the notes plus accrued interest as of the closing of the Subsequent Financing) x (1.25) / (the per security price of the securities sold in the Subsequent Financing), or (ii) convert into a new financing in which the Company shall issue to the investor one share of common stock and one-half of one warrant at a purchase price no greater than $0.35 per share. The per security price of the securities sold in the Subsequent Financing shall not exceed $0.35. In addition, the holders of the Convertible Notes shall have the option, at any time, to convert all principal and accrued interest into common stock at price per share of $0.35. In the event that the Company shall, at any time, issue or sell additional shares of common stock or common stock equivalents, as defined, at a price per share less than $0.35, then the conversion price of the Convertible Notes shall be reduced to a price equal to the consideration paid for these additional shares of common stock. Pursuant to the Note and Warrant Purchase Agreement, the Company shall issue warrants at an initial exercise price per share of $0.50 to purchase a number of shares of common stock equal to fifty percent of the number of shares of common stock such investor would receive upon full conversion of the Convertible Notes. The warrants will be issued upon conversion. The initial closings of the Convertible Notes were consummated on May 28, 2015, June 2, 2015 and June 19, 2015, for an aggregate amount of $400,000. In connection with the initial closings of the Convertible Notes, the Company paid to a placement agent a cash fee of $32,000. The issuance of the Convertible Notes has resulted in an adjustment to the conversion price and exercise price of certain of the Companys outstanding securities, including its Series A Preferred Stock, Series B Preferred Stock and certain outstanding warrants, to $0.35 per share as a result of the various full-ratchet provisions contained in such securities. In connection with the issuance of the Notes and the Convertible Notes, the Company incurred $183,144 in issuance costs. These costs are recorded as deferred issuance costs, included in prepaid and other current assets on the Companys balance sheet and amortized to interest expense over the term of such notes. For the six months ended June 30, 2015 and 2014, respectively, the Company has amortized $60,486 and $0 of issuance costs to expense. Interest expense, including amortization of deferred issuance costs, totaled $157,924 and $0 for the six months ended June 30, 2015 and 2014, respectively. |
CAPITAL STOCK
CAPITAL STOCK | 6 Months Ended |
Jun. 30, 2015 | |
Notes to Financial Statements | |
CAPITAL STOCK | SERIES A PREFERRED STOCK The Company is authorized to issue 100,000,000 shares of preferred stock, $0.001 par value per share, of which 3,500,000 shares have been designated Series A Preferred Stock. At June 30, 2015 and December 31, 2014, 811,148 and 949,477 shares of Series A Preferred Stock, respectively, were issued and outstanding. During the six months ended June 30, 2015, 180,119 shares of Series A Preferred Stock were converted into 320,000 shares of common stock. In addition, the Company issued 9,691 shares of its common stock in satisfaction of a $4,329 dividend accrued on the shares Series A Preferred Stock that were converted. For the six months ended June 30, 2015, the Company accrued a preferred stock dividend of $34,685 and issued 41,790 shares of Series A Preferred Stock in satisfaction of such accrued dividends. During the six months ended June 30, 2014, 1,433,734 shares of Series A Preferred Stock were converted into 2,380,000 shares of common stock. In addition, the Company issued 32,137 shares of the Companys common stock in satisfaction of a $16,068 dividend accrued on the shares Series A Preferred Stock that were converted. For the six months ended June 30, 2014, the Company accrued a preferred stock dividend of $38,666 and issued 46,586 shares of Series A Preferred Stock in satisfaction of such accrued dividends. SERIES B PREFERRED STOCK The Company is authorized to issue 100,000,000 shares of preferred stock, $0.001 par value per share, of which 12,000,000 shares have been designated Series B Preferred Stock. At June 30, 2015 and December 31, 2014, 5,694,571 shares of Series B Preferred Stock were issued and outstanding. For the six months ended June 30, 2015 and 2014, the Company accrued a Series B Preferred Stock dividend of $248,503 and $225,219, respectively. In addition, the Company issued 2,507 shares of common stock in payment of such dividends as related to the Series B Preferred Stock converted to common stock during the six months ended June 30, 2014. During the six months ended June 30, 2015, there were no voluntary conversions. COMMON STOCK The Company has authorized 100,000,000 shares of its common stock, $0.001 par value per share. At June 30, 2015 and December 31, 2014, the Company had issued and outstanding 29,527,187 and 29,197,497 shares of its common stock, respectively. |
STOCK PURCHASE WARRANTS
STOCK PURCHASE WARRANTS | 6 Months Ended |
Jun. 30, 2015 | |
Notes to Financial Statements | |
STOCK PURCHASE WARRANTS | During the six months ended June 30, 2015, there were no stock purchase warrants issued. During the six months ended June 30, 2015, 2,609,307 stock purchase warrants expired with a weighted average exercise price of $1.29. As a result of the issuance of the Convertible Notes payable pursuant to the Note and Warrant Purchase Agreement entered into with certain accredited investors on May 28, 2015, the exercise price of the warrants issued in connection with the sale of the Company's Series B Preferred Stock was reduced to $0.35 per share. The following represents additional information related to common stock warrants outstanding and exercisable at June 30, 2015: Exercise Price Number of Shares Under Warrants Weighted Average Remaining Contract Life in Years Weighted Average Exercise Price $ 0.35 8,676,408 3.26 $ 0.35 Total warrants accounted for as derivative liability 8,676,408 3.26 $ 0.35 $ 0.83 2,175,970 3.20 $ 0.83 $ 0.84 20,000 1.09 $ 0.84 $ 0.85 281,912 2.07 $ 0.85 $ 0.95 20,000 1.26 $ 0.95 $ 1.00 165,417 3.63 $ 1.00 $ 1.33 905,021 0.30 $ 1.33 Total warrants accounted for as equity 3,568,320 2.37 $ 0.96 Total for all warrants outstanding 12,244,728 3.00 $ 0.53 For warrants granted that are accounted for as a derivative liability, the Company used a Binomial Options Pricing model. The primary assumptions used to determine the fair values of these warrants were: risk free interest rate of 1.63%, volatility of 49.42%, and actual term and exercise price of the warrants granted. |
COMMON STOCK OPTIONS
COMMON STOCK OPTIONS | 6 Months Ended |
Jun. 30, 2015 | |
Notes to Financial Statements | |
COMMON STOCK OPTIONS | On February 11, 2011, the Company adopted its 2011 Equity Incentive Plan (the Plan) under which 6,475,750 shares of common stock were reserved for issuance under options or other equity interests as set forth in the Plan. Under the Plan, options are available for issuance to employees, officers, directors, consultants and advisors. The Plan provides that the board of directors will determine the exercise price and vesting terms of each option on the date of grant. Options granted under the Plan generally expire ten years from the date of grant. Under the Plan, the Company has issued 161,250 shares of fully paid and non-assessable restricted common stock to a director of the Company. These shares of restricted stock are subject to the terms of the Plan and are unvested and outstanding as of June 30, 2015. The shares shall vest upon the earlier of (i) the occurrence of a Change of Control, as defined in the Plan, (ii) the successful completion of a Phase II clinical trial for any of the Companys products, or (iii) the determination by the board of directors to provide for immediate vesting. The weighted average grant-date fair value is $1.07 per share. The following is a summary of all common stock option activity for the six months ended June 30, 2015: Options Outstanding Weighted Average Exercise Price Outstanding at December 31, 2014 4,644,428 $ 0.68 Options granted 125,000 $ 0.53 Options forfeited (15,000) $ 0.13 Options exercised - $ - Outstanding at June 30, 2015 4,754,428 $ 0.67 Options Exercisable Weighted Average Exercise Price per Share Exercisable at December 31, 2014 3,781,096 $ 0.68 Exercisable at June 30, 2015 4,112,762 $ 0.67 The weighted average fair value of options granted during the six months ended June 30, 2015 was $0.15. At June 30, 2015, the weighted average remaining contractual term for exercisable and outstanding options is 5.27 and 5.51 years, respectively. At June 30, 2015, the aggregate intrinsic value of all of the Companys exercisable and outstanding options is $175,500 and $175,500, respectively. Employee stock-based compensation expense for the six months ended June 30, 2015 and 2014 is $150,570 and $236,953, respectively. To compute compensation expense, the Company estimated the fair value of each option award on the date of grant using the Black-Scholes option pricing model for employees, and calculated the fair value of each option award at the end of the period for non-employees. The Company based the expected volatility assumption on a volatility index of peer companies as the Company did not have sufficient historical market information to estimate the volatility of its own stock. The expected term of options granted represents the period of time that options are expected to be outstanding. The Company estimated the expected term of stock options by using the simplified method. The expected forfeiture rates are based on the historical employee forfeiture experiences. To determine the risk-free interest rate, the Company utilized the U.S. Treasury yield curve in effect at the time of grant with a term consistent with the expected term of the Companys awards. The Company has not declared a dividend on its common stock since its inception and has no intentions of declaring a dividend in the foreseeable future and therefore used a dividend yield of zero. The fair value of each share-based payment is estimated on the measurement date using the Black-Scholes model with the following assumptions as of June 30, 2015 and 2014, respectively: risk-free rate with a range from 1.82% - 1.96% and 3.31% - 3.40%, respectively, volatility of 49.42% and 60.13%, respectively, and expected term of 5 years and 5.5 years, respectively. There was no dividend yield included in the calculations. As of June 30, 2015, there was $34,212 of unrecognized compensation cost related to non-vested options. The unrecognized compensation expense is estimated to be recognized over a period of 0.49 years at June 30, 2015. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2015 | |
Notes to Financial Statements | |
COMMITMENTS AND CONTINGENCIES | License Agreements On June 26, 2014, the Company and The General Hospital Corporation, d/b/a Massachusetts General Hospital (MGH) entered into two license agreements (the Agreements), which Agreements replace the single license agreement between the Company and MGH dated April 27, 2009, as amended by letter dated June 21, 2011 and agreement dated October 31, 2011 (the Original Agreement). The Agreements provide exclusive licenses for the Companys two lead product candidates, BFPET and CardioPET, two of the three cardiac imaging technologies covered by the Original Agreement. The Company and MGH are in discussions regarding the exclusive license to VasoPET, the third product candidate covered by the Original Agreement, the Companys rights to which ceased upon the termination of the Original Agreement contemporaneously with the execution of the new Agreements. The Agreements were entered into primarily for the purpose of separating the Companys rights and obligations with respect to its different product development programs. Each of the Agreements requires the Company to pay MGH an initial license fee of $175,000 and annual license maintenance fees of $125,000 each. The Agreements require the Company to meet certain obligations, including, but not limited to, meeting certain development milestones relating to clinical trials and filings with the United States Food and Drug Administration. MGH has the right to cancel or make non-exclusive certain licenses on certain patents should the Company fail to meet stipulated obligations and milestones. Additionally, upon commercialization, the Company is required to make specified milestone payments and royalties on commercial sales. The Company is current with all stipulated obligations and milestones under the Agreements and the Agreements remain in full force and effect. The Company believes that it maintains a good relationship with MGH and will be able to obtain waivers or extension of its obligations under the Agreement, should the need arise. If MGH were to refuse to provide the Company with a waiver or extension of any of its obligations or were to cancel or make the license non-exclusive, this would have a material adverse impact on the Company as it may be unable to commercialize products without exclusivity and would lose its competitive edge for portions of the patent portfolio. Clinical Research Services Agreements On September 7, 2012, the Company entered into a Clinical Research Services Agreement with SGS Life Science Services (SGS), a company with its registered offices in Belgium, for clinical research services relating to the Companys CardioPET Phase II study to assess myocardial perfusion and fatty acid uptake in coronary artery disease (CAD) patients. The phase II trial will be an open label trial designed to assess the safety and diagnostic performance of CardioPET as compared to stress echocardiography, myocardial perfusion imaging and angiography as a gold standard of background disease. In addition, the Company engaged FGK Representative Service GmbH to serve as the Companys sponsor in compliance with the laws governing clinical trials conducted in the European Union. On February 28, 2013, the Company announced that the Phase II trial had begun and released the initial data and images from the trial. On February 6, 2014, the Company presented interim data from the trial at the SNMMI mid-winter meeting. On October 20, 2014, the Company presented additional interim data at the EANM meeting in Gothenburg, Sweden. In December 2014, the Company announced that the enrollment for a Phase II clinical trial of CardioPET was closed. The estimated remaining cost payable to SGS through the completion of the trial is approximately $500,000. On May 23, 2014, the Company entered into a Master Services Agreement with PPD Development, LP, a clinical research organization engaged in the business of managing clinical research programs and providing clinical development and other related services, for the clinical research services relating to the Companys BFPET Phase II study. The Phase II trial will be an open label trial designed to assess the safety and diagnostic performance of BFPET. Multiple trial sites are planned in various locations in the United States. In connection with this agreement, the Company has recorded $280,000 as of June 30, 2015 related to start-up costs. The trial is expected to commence in the second half of 2015. The estimated cost of this program is $1.7 million. Executive Employment Contracts The Company maintains employment contracts with key Company executives that provide for the continuation of salary and the grant of certain options to the executives if terminated for reasons other than cause, as defined within the agreements. One contract also provides for a $1 million bonus should the Company execute transactions as specified in the contract, including the sale of substantially all of the Companys assets or stock or a merger transaction, any of which resulting in compensation to the Companys stockholders aggregating in excess of $50 million for such transaction. Operating Lease Commitment In July 2011, the Company entered into a three-year lease for office space, which commenced May 1, 2012 and expires on April 30, 2015. On July 1, 2014, the Company increased its office space and amended this agreement. The amended annual minimum lease payments for this office space are $76,200 per year plus common area costs. In accordance with the amended agreement, the Company maintains a $9,525 security deposit. On February 24, 2015, the Company signed a three-year renewal of the lease which will expire on April 30, 2018. Subsequent to April 30, 2016, the Company will have the option to terminate the lease with 6 months prior notice. The future minimum lease payments remaining through April 30, 2018 are as follows: Year ending December 31: 2015 $ 38,100 2016 76,200 2017 76,200 2018 25,400 Total $ 215,900 Rent expense, net of sublease income, was $38,294 and $25,617 for the six months ended June 30, 2015 and 2014, respectively. Legal Contingencies In July 2013, an action was filed against the Company in the United States District Court for the District of Nevada. The action, Todd Nelson v. Fluoropharma Medical, Inc. and Does 1 through 10, No. 13 CV 01152 JAD CWH, The Company is not aware of any other material, active, pending or threatened proceeding, nor is the Company, or any subsidiary, involved as a plaintiff or defendant in any other material proceeding or pending litigation. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2015 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | On July 2, 2015, the Company issued promissory note for $195,000 which matured on August 2, 2015. The note bears interest at the rate of 18% per annum if the note is repaid on or prior to a maturity date, and 24% if the note is not repaid by the maturity date of August 2, 2015. On August 7, 2015, the Company has repaid the outstanding balance plus accrued interest in the amount of $3,542. On July 16 and August 6, 2015, the Company issued additional Convertible Notes in the principal amounts of $250,000 and $1,000,000, respectively. The Convertible Notes and related purchase agreement were amended on August 6, 2015 to increase the aggregate principal amount issuable under the purchase agreement from $2,000,000 to $3,000,000. From June 30, 2015 through August 10, 2015, 90,663 shares of Series A preferred Stock were converted into 215,000 shares of common stock. In addition, the Company issued 1,393 shares of its common stock in satisfaction of a $487 dividend accrued on the shares Series A Preferred Stock that were converted. |
SUMMARY OF SIGNIFICANT ACCOUN15
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2015 | |
Summary Of Significant Accounting Policies Policies | |
Basis of Presentation | The accompanying unaudited condensed consolidated financial statements of FluoroPharma Medical, Inc. and Subsidiary have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) for interim financial information and the rules and regulations of the U.S. Securities and Exchange Commission (the "SEC"). Accordingly, the unaudited condensed consolidated financial statements do not include all information and footnotes required by U.S. GAAP for complete annual financial statements. In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments, consisting of only normal recurring adjustments, considered necessary for a fair presentation. Certain prior year amounts in the condensed consolidated financial statements and notes thereto have been reclassified to conform to the current periods presentation. Interim operating results are not necessarily indicative of results that may be expected for the year ending December 31, 2015 or for any other interim period. The unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements of the Company and the notes thereto as of and for the year ended December 31, 2014, as included in the Company's Form 10-K filed with the SEC on March 31, 2015. |
Going Concern | The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has experienced net losses and negative cash flows from operations since its inception. The Company has sustained cumulative losses attributable to common stockholders of $31,156,336 as of June 30, 2015. The Company has historically financed its operations through issuances of equity and the proceeds of debt instruments. In the past, the Company has also provided for its cash needs by issuing common stock, options and warrants for certain operating costs, including consulting and professional fees. During the six months ended June 30, 2015, the Company raised net cash proceeds of $545,185 through the issuance of notes payable. In addition, during the six months ended June 30, 2015, the Company received gross proceeds of $35,970 from the sale of freely tradable securities received pursuant to the issuance and sale in a private placement of promissory notes (see Note 4). During the year ended December 31, 2014, the Company raised net cash of $2,243,102 through the issuance of notes payable, the sale of common stock and the exercise of warrants. Additionally, the Company received cash proceeds of $568,852 from the sale of freely tradable securities received as consideration in the Companys 2013 private placement of its Series B Preferred Stock. The Company continues to actively pursue various funding options, including equity offerings, to obtain additional funds to continue the development of its products and bring them to commercial markets. Management continues to assess fund raising opportunities to ensure minimal dilution to its existing shareholder base and to obtain the best price for its securities. Management is optimistic based upon its ability to raise funds in prior years, through private placement offerings, that it will be able to raise additional funds in the future. If the Company is unable to raise additional capital as may be needed to meet its projections for operating expenses, it could have a material adverse effect on liquidity or require the Company to cease or significantly delay some of its clinical trials. These financial statements do not include any adjustments relating to the recoverability of recorded asset amounts that might be necessary as a result of the above uncertainty. |
Investments | Investments that are purchased and held principally for the purpose of selling them in the near term are classified as trading securities and reflected on the balance sheet at fair value, with unrealized gains and losses included in earnings. All the Companys investments are considered trading securities at December 31, 2014. During the six months ended June 30, 2015, the Company sold all investments and received cash proceeds of $35,970. The Company recorded realized losses of $11,946 upon the sale. |
Intangible Assets | The Companys intangible assets consist of technology licenses and are carried at the legal cost to obtain them. Intangible assets are amortized using the straight-line method over the estimated useful life. Useful lives on technology licenses are 5 to 15 years. |
Fair Value of Financial Instruments | The Company groups its assets and liabilities measured at fair value, in three levels based on the markets in which the assets and liabilities are traded and the reliability of the assumptions used to determine fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). Financial instruments with readily available active quoted prices or for which fair value can be measured from actively quoted prices generally will have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value. The three levels of the fair value hierarchy are as follows: Level 1 Valuation is based on quoted prices in active markets for identical assets or liabilities. Valuations are obtained from readily available pricing sources for market transactions involving identical assets or liabilities. Level 2 Valuation is based on observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 Valuation is based on unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an instruments level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The Companys assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the financial instrument. The Company recognizes transfers between levels at the end of the reporting period as if the transfers occurred on the last day of the reporting period. Assets and liabilities measured at fair value on a recurring basis at June 30, 2015 are summarized below: June 30, 2015 Level 1 Level 2 Level 3 Fair Value Current Liabilities: Derivative warrant liability $ - $ - $ 1,628,343 $ 1,628,343 Assets and liabilities measured at fair value on a recurring basis at December 31, 2014 are summarized below: December 31, 2014 Level 1 Level 2 Level 3 Fair Value Current Assets: Trading securities $ 39,930 $ - $ - $ 39,930 Current Liabilities: Derivative warrant liability $ - $ - $ 1,354,319 $ 1,354,319 The following table sets forth the changes in the estimated fair value for our Level 3 classified derivative warrant liability: Six Months Ended Six Months Ended June 30, 2015 June 30, 2014 Fair value at beginning of period $ 1,354,319 $ 2,549,196 Modification and reclassification of outstanding warrants - 114,923 Change in fair value 274,024 625,165 Fair value at end of period $ 1,628,343 $ 3,289,284 |
Recently Issued Accounting Standards | In April 2015, the Financial Accounting Standards Board (the FASB) issued Accounting Standards Update (ASU) 2015-03, 'Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. ASU 2015-03 is intended to simplify the presentation of debt issuance costs. These amendments require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by the amendments in this ASU. This new guidance is effective for fiscal years beginning after December 15, 2015 and interim periods within those fiscal years. Early adoption is permitted. The Company is currently in the process of evaluating the impact of the adoption of this ASU on the financial statements. In January 2015, FASB issued ASU 2015-01 Income Statement - Extraordinary and Unusual Items (Subtopic 225-20): Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items. This ASU removes the concept of an extraordinary item. Subtopic 225-20, Income Statement - Extraordinary and Unusual Items, required that an entity separately classify, present, and disclose extraordinary events and transactions. Presently, an event or transaction is presumed to be an ordinary and usual activity of the reporting entity unless evidence clearly supports its classification as an extraordinary item. If an event or transaction meets the criteria for extraordinary classification, an entity is required to segregate the extraordinary item from the results of ordinary operations and show the item separately in the income statement, net of tax, after income from continuing operations. The entity also is required to disclose applicable income taxes and either present or disclose earnings-per-share data applicable to the extraordinary item. The amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015. Early adoption is permitted provided that the guidance is applied from the beginning of the fiscal year of adoption. The Company is currently in the process of evaluating the impact of the adoption of this ASU on the financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN16
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Summary Of Significant Accounting Policies Tables | |
Fair value of financial instruments | Assets and liabilities measured at fair value on a recurring basis at June 30, 2015 are summarized below: June 30, 2015 Level 1 Level 2 Level 3 Fair Value Current Liabilities: Derivative warrant liability $ - $ - $ 1,628,343 $ 1,628,343 Assets and liabilities measured at fair value on a recurring basis at December 31, 2014 are summarized below: December 31, 2014 Level 1 Level 2 Level 3 Fair Value Current Assets: Trading securities $ 39,930 $ - $ - $ 39,930 Current Liabilities: Derivative warrant liability $ - $ - $ 1,354,319 $ 1,354,319 |
Fair value of Level 3 financial instruments | Six Months Ended Six Months Ended June 30, 2015 June 30, 2014 Fair value at beginning of period $ 1,354,319 $ 2,549,196 Modification and reclassification of outstanding warrants - 114,923 Change in fair value 274,024 625,165 Fair value at end of period $ 1,628,343 $ 3,289,284 |
OTHER BALANCE SHEET INFORMATI17
OTHER BALANCE SHEET INFORMATION (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Selected balance sheet captions | June 30, 2015 December 31, 2014 Prepaid expenses & other: Prepaid insurance $ 20,196 $ 24,576 Deferred closing costs 78,269 83,941 Other 33,816 50,332 Prepaid expenses & other $ 132,281 $ 158,849 Accrued expenses and other: Professional fees $ 28,695 $ 47,028 Accrued dividends Series B Preferred Stock 837,090 588,588 Deferred salary 88,958 63,542 Accrued interest on Note Payable 150,403 53,749 Research and development 67,803 170,292 Other 229,902 151,412 Accrued expenses and other $ 1,402,851 $ 1,074,611 |
STOCK PURCHASE WARRANTS (Tables
STOCK PURCHASE WARRANTS (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Stock Purchase Warrants Tables | |
Common stock warrants outstanding and exercisable | Exercise Price Number of Shares Under Warrants Weighted Average Remaining Contract Life in Years Weighted Average Exercise Price $ 0.35 8,676,408 3.26 $ 0.35 Total warrants accounted for as derivative liability 8,676,408 3.26 $ 0.35 $ 0.83 2,175,970 3.20 $ 0.83 $ 0.84 20,000 1.09 $ 0.84 $ 0.85 281,912 2.07 $ 0.85 $ 0.95 20,000 1.26 $ 0.95 $ 1.00 165,417 3.63 $ 1.00 $ 1.33 905,021 0.30 $ 1.33 Total warrants accounted for as equity 3,568,320 2.37 $ 0.96 Total for all warrants outstanding 12,244,728 3.00 $ 0.53 |
COMMON STOCK OPTIONS (Tables)
COMMON STOCK OPTIONS (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Common Stock Options Tables | |
Common stock options outstanding and exercisable | The following is a summary of all common stock option activity for the six months ended June 30, 2015: Options Outstanding Weighted Average Exercise Price Outstanding at December 31, 2014 4,644,428 $ 0.68 Options granted 125,000 $ 0.53 Options forfeited (15,000) $ 0.13 Options exercised - $ - Outstanding at June 30, 2015 4,754,428 $ 0.67 Options Exercisable Weighted Average Exercise Price per Share Exercisable at December 31, 2014 3,781,096 $ 0.68 Exercisable at June 30, 2015 4,112,762 $ 0.67 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Commitments And Contingencies Tables | |
COMMITMENTS AND CONTINGENCIES | Year ending December 31: 2015 $ 38,100 2016 76,200 2017 76,200 2018 25,400 Total $ 215,900 |
ORGANIZATION, BASIS OF PRESEN21
ORGANIZATION, BASIS OF PRESENTATION AND GOING CONCERN (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | 136 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Mar. 31, 2015 | |
Accounting Policies [Abstract] | |||||
Cumulative losses | $ (1,572,662) | $ (2,031,487) | $ (2,289,653) | $ (3,503,821) | $ (31,156,336) |
Gross proceeds from sale of freely tradable securities | 545,185 | ||||
Cash proceeds from sale of investments | 35,970 | ||||
Proceeds from issuance of notes payable, the sale of common stock and the exercise of warrants | 2,243,102 | ||||
Proceeds from sale of tradable securities | $ 568,852 |
SUMMARY OF SIGNIFICANT ACCOUN22
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Trading securities | $ 39,930 | |
Derivative warrant liability | $ 628,343 | 1,354,319 |
Fair Value, Inputs, Level 1 [Member] | ||
Trading securities | $ 39,930 | |
Derivative warrant liability | ||
Fair Value, Inputs, Level 2 [Member] | ||
Trading securities | ||
Derivative warrant liability | ||
Fair Value, Inputs, Level 3 [Member] | ||
Trading securities | ||
Derivative warrant liability | $ 628,343 | $ 1,354,319 |
SUMMARY OF SIGNIFICANT ACCOUN23
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details1) - USD ($) | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Fair value at beginning of period | $ 2,549,196 | |
Issuance of derivative warrant liability | ||
Modification and reclassification of outstanding warrants | $ 114,923 | |
Change in fair value | (625,165) | |
Fair value at end of period | $ 3,289,284 | |
Fair Value, Inputs, Level 3 [Member] | ||
Fair value at beginning of period | $ 1,354,319 | |
Issuance of derivative warrant liability | ||
Modification and reclassification of outstanding warrants | ||
Change in fair value | $ (274,024) | |
Fair value at end of period | $ 628,343 |
SUMMARY OF SIGNIFICANT ACCOUN24
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Property, Plant and Equipment [Line Items] | ||
Intangible assets, useful life | 15 years | |
Employee stock-based compensation expense | $ 150,570 | $ 236,953 |
Realized losses | 11,946 | |
Proceeds from sale of investments | $ 35,970 | |
Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, estimated useful lives | 3 years | |
Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, estimated useful lives | 5 years |
OTHER BALANCE SHEET INFORMATI25
OTHER BALANCE SHEET INFORMATION (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Prepaid expenses & other: | ||
Prepaid insurance | $ 20,196 | $ 24,576 |
Deferred closing costs | 78,269 | 83,941 |
Other | 33,816 | 50,332 |
Prepaid expenses & other | 132,281 | 158,849 |
Accrued expenses and other: | ||
Professional fees | 28,695 | 47,028 |
Deferred salary | 88,958 | 63,542 |
Accrued interest on Note Payable | 15,403 | 53,749 |
Research and development | 67,803 | 170,292 |
Other | 229,902 | 151,412 |
Accrued expenses and other | 1,402,851 | 1,074,611 |
Series B Preferred Stock [Member] | ||
Accrued expenses and other: | ||
Accrued dividends | $ 837,090 | $ 588,588 |
CONVERTIBLE NOTES PAYABLE _ S26
CONVERTIBLE NOTES PAYABLE – SHORT TERM (Details Narrative) - USD ($) | Aug. 06, 2015 | Jul. 16, 2015 | Jul. 02, 2015 | Sep. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 |
Notes issued | $ 1,000,000 | $ 250,000 | $ 195,000 | |||
Marketable securities received | $ 11,946 | $ 302,116 | ||||
Note interest rate | 18.00% | |||||
Note issuance costs | 183,144 | |||||
Note issuance costs amortized to expense | 60,486 | $ 0 | ||||
Principal payments | $ 3,542 | 10,000 | ||||
Interest expense | 157,924 | $ 0 | ||||
Accredited Investors [Member] | 2014 Notes [Member] | ||||||
Notes issued | 1,998,500 | |||||
Marketable securities received | $ 47,916 | |||||
Maturity term | 1 year | |||||
Note interest rate | 8.00% | |||||
Amended notes | $ 2,198,416 | |||||
Accredited Investors [Member] | 2015 Notes [Member] | ||||||
Notes issued | $ 2,000,000 | |||||
Warrant exercise price | $ .50 | |||||
Proceeds from note issuance | $ 400,000 | |||||
Placement agent fee | 32,000 | |||||
Accredited Investors [Member] | 2014 Notes [Member] | ||||||
Notes issued | 200,000 | |||||
Stockholder [Member] | ||||||
Notes issued | $ 150,000 | |||||
Maturity term | 2 months | |||||
Note interest rate | 12.00% | |||||
Accrued interest | 17,707 | |||||
Convertible notes payable - short term | $ 115,000 | |||||
Stockholder [Member] | NoteDefault [Member] | ||||||
Note interest rate | 16.00% |
CAPITAL STOCK (Details Narrativ
CAPITAL STOCK (Details Narrative) - USD ($) | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 | |
Capital stock additional details | |||
Preferred stock, authorized | 100,000,000 | 100,000,000 | |
Common stock, par value | $ .001 | ||
Common stock, Authorized | 100,000,000 | ||
Common stock, shares issued | 29,527,187 | 29,197,497 | |
Common stock, outstanding | 29,527,187 | 29,197,497 | |
Series A Preferred Stock [Member] | |||
Capital stock additional details | |||
Preferred stock, authorized | 3,500,000 | 3,500,000 | |
Preferred stock par value | $ .001 | ||
Preferred stock Issued | 811,148 | 949,744 | |
Preferred stock Outstanding | 811,148 | 949,744 | |
Preferred stock converted to common stock | 180,119 | 1,433,734 | |
Issuance of common shares upon conversion of preferred | 320,000 | 2,380,000 | |
Stock issued in satisfaction of dividend | 9,691 | 32,137 | |
Payment of accrued dividend | $ 4,329 | $ 16,068 | |
Preferred dividend accrued | $ 34,685 | $ 38,666 | |
Shares issued in payment of accrued dividends | 41,790 | 46,586 | |
Series B Preferred Stock [Member] | |||
Capital stock additional details | |||
Preferred stock, authorized | 12,000,000 | 12,000,000 | |
Preferred stock par value | $ .001 | ||
Preferred stock Issued | 5,694,571 | 5,694,571 | |
Preferred stock Outstanding | 5,694,571 | 5,694,571 | |
Stock issued in satisfaction of dividend | 2,507 | ||
Preferred dividend accrued | $ 248,503 | $ 225,219 |
STOCK PURCHASE WARRANTS (Detail
STOCK PURCHASE WARRANTS (Details) - $ / shares | 6 Months Ended | |
Jun. 30, 2015 | Dec. 31, 2014 | |
Stock Purchase Warrants | ||
Weighted Average Exercise Price | $ .67 | $ .68 |
Weighted Average Remaining Contract Life | 5 years 6 months 4 days | |
Warrant [Member] | ||
Stock Purchase Warrants | ||
Equity Warrants | 3,568,320 | |
Number of Shares | 12,244,728 | |
Weighted Average Exercise Price | $ 0.53 | |
Warrant [Member] | Warrant 1 [Member] | ||
Stock Purchase Warrants | ||
Exercise Price | $ .35 | |
Derivative Warrants | 8,676,408 | |
Weighted Average Exercise Price | $ .35 | |
Weighted Average Remaining Contract Life | 3 years 3 months 4 days | |
Warrant [Member] | Derivative Liability Warrant Total [Member] | ||
Stock Purchase Warrants | ||
Weighted Average Remaining Contract Life | 3 years 3 months 4 days | |
Warrant [Member] | Warrant 3 [Member] | ||
Stock Purchase Warrants | ||
Exercise Price | $ 0.83 | |
Equity Warrants | 175,970 | |
Weighted Average Exercise Price | $ 0.83 | |
Weighted Average Remaining Contract Life | 1 year 1 month 2 days | |
Warrant [Member] | Warrant 4 [Member] | ||
Stock Purchase Warrants | ||
Exercise Price | $ 0.84 | |
Equity Warrants | 20,000 | |
Weighted Average Exercise Price | $ 0.84 | |
Weighted Average Remaining Contract Life | 2 years 26 days | |
Warrant [Member] | Warrant 5 [Member] | ||
Stock Purchase Warrants | ||
Exercise Price | $ 0.85 | |
Equity Warrants | 281,912 | |
Weighted Average Exercise Price | $ 0.85 | |
Weighted Average Remaining Contract Life | 1 year 3 months 4 days | |
Warrant [Member] | Warrant 6 [Member] | ||
Stock Purchase Warrants | ||
Exercise Price | $ 0.95 | |
Equity Warrants | 20,000 | |
Weighted Average Exercise Price | $ 0.95 | |
Weighted Average Remaining Contract Life | 3 years 7 months 17 days | |
Warrant [Member] | Warrant 7 [Member] | ||
Stock Purchase Warrants | ||
Exercise Price | $ 1 | |
Equity Warrants | 165,417 | |
Weighted Average Exercise Price | $ 1 | |
Weighted Average Remaining Contract Life | 3 months 18 days | |
Warrant [Member] | Warrant 8 [Member] | ||
Stock Purchase Warrants | ||
Exercise Price | $ 1.33 | |
Equity Warrants | 905,021 | |
Weighted Average Exercise Price | $ 1.33 | |
Weighted Average Remaining Contract Life | 2 years 4 months 13 days | |
Warrant [Member] | Equity Warrant Total [Member] | ||
Stock Purchase Warrants | ||
Weighted Average Exercise Price | $ .96 | |
Weighted Average Remaining Contract Life | 3 years | |
Derivative Warrant [Member] | ||
Stock Purchase Warrants | ||
Exercise Price | $ .35 | |
Derivative Warrants | 8,676,408 | |
Weighted Average Exercise Price | $ .35 | |
Weighted Average Remaining Contract Life | 2 months 12 days |
STOCK PURCHASE WARRANTS (Deta29
STOCK PURCHASE WARRANTS (Details Narrative) - $ / shares | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Stock Purchase Warrants Details Narrative | ||
Risk free rate | 1.37% | |
Expected volatility rate | 49.42% | |
Stock purchase warrants issued | ||
Warrants expired | 2,609,307 | |
Warrants expired, exercise price | $ 1.29 | |
Risk free interest rate | 163.00% | |
Volatility | 49.42% | 30.13% |
COMMON STOCK OPTIONS (Details)
COMMON STOCK OPTIONS (Details) - 6 months ended Jun. 30, 2015 - $ / shares | Total |
Summary of all common stock option activity | |
Outstanding shares, beginning of period | 4,644,428 |
Options granted, shares | 125,000 |
Options forfeited, shares | (15,000) |
Options exercised | |
Outstanding shares | 4,754,428 |
Outstanding weighted average exercise price, beginning | $ .68 |
Options granted, weighted average exercise price | .53 |
Options forfeited, weighted average exercise price | $ .13 |
Options exercised, weighted average exercise price | |
Outstanding weighted average exercise price, ending | $ .67 |
Exercisable shares, beginning of period | 3,781,096 |
Exercisable shares,end of period | 4,112,762 |
Exercisable, weighted average exercise price, Beginning of period | $ .68 |
Exercisable, weighted average exercise price, End of period | $ .67 |
COMMON STOCK OPTIONS (Details N
COMMON STOCK OPTIONS (Details Narrative) - USD ($) | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Equity plan reserved shares | 6,475,750 | |
Equity plan issued shares | 161,250 | |
Options granted, weighted average exercise price | $ .53 | |
Weighted average fair value of options granted | $ .15 | |
Weighted average remaining contract life, exercisable options | 5 years 3 months 6 days | |
Weighted average remaining contract life, outstanding options | 5 years 6 months 4 days | |
Aggregate intrinsic value of options exercisable | $ 175,500 | |
Aggregate intrinsic value of options outstanding | 175,500 | |
Employee stock-based compensation expense | $ 150,570 | $ 236,953 |
Risk free rate | 163.00% | |
Volatility rate | 49.42% | 30.13% |
Expected term | 5 years | 5 years 6 months |
Unrecognized compensation cost related to non-vested options | $ 34,212 | |
NonvestedAwards Total Compensation Cost Not Yet Recognized Period For Recognition | 5 months 27 days | |
Minimum [Member] | ||
Risk free rate | 1.82% | 3.31% |
Maximum [Member] | ||
Risk free rate | 1.96% | 3.40% |
COMMITMENTS AND CONTINGENCIES32
COMMITMENTS AND CONTINGENCIES (Details) | Jun. 30, 2015USD ($) |
The future minimum lease payments, year ending December 31, | |
2,015 | $ 38,100 |
2,016 | 76,200 |
2,017 | 76,200 |
2,018 | 25,400 |
Total future minimum lease payments | $ 215,900 |
COMMITMENTS AND CONTINGENCIES33
COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Notes to Financial Statements | ||
Cost payable | $ 500,000 | |
Bonus for key company executive if the Company execute transactions as specified in the contract | $ 1,000,000 | |
Executive employment contract conditions | should the Company execute transactions as specified in the contract, including the sale of substantially all of the Companys assets or stock or a merger transaction, any of which resulting in compensation to the Companys stockholders aggregating in excess of $50 million for such transaction | |
Lease term for office space | 3 years | |
Annual minimum lease payments | $ 76,200 | |
Security deposit for lease | 9,525 | |
Annual license maintenance fee | $ 125,000 | |
Initial license fee | 175,000 | |
Rent expenses | 38,294 | $ 25,617 |
Plaintiff amount | 325,200 | |
Start-up costs | $ 280,000 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - USD ($) | Aug. 06, 2015 | Jul. 16, 2015 | Jul. 02, 2015 | Aug. 10, 2015 | Jun. 30, 2015 | Jun. 30, 2014 |
Note issued | $ 1,000,000 | $ 250,000 | $ 195,000 | |||
Interest rate | 18.00% | |||||
Default rate | 24.00% | |||||
Maturity date | Aug. 2, 2015 | |||||
Repayment of notes payable | $ 3,542 | $ 10,000 | ||||
Series A Preferred Stock [Member] | ||||||
Preferred stock converted to common stock | 90,663 | |||||
Issuance of common shares upon conversion of preferred | 215,000 |