Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Apr. 17, 2017 | Jun. 30, 2016 | |
Document and Entity Information | |||
Entity Registrant Name | PROLUNG INC | ||
Entity Central Index Key | 1,541,884 | ||
Document Type | 10-K/A | ||
Document Period End Date | Dec. 31, 2016 | ||
Amendment Flag | true | ||
Amendment description | ProLung, Inc. (the Company) is filing this Amendment No. 3 on Form 10-K/A (this Amendment, together with the portions of Amendments No. 1 and 2 on Form 10-K/A not superseded hereby, this Report) in order to amend the disclosure set forth in Amendment No. 1 on Form 10-K/A filed by the Company on April 19, 2017 (the First Amendment) and Amendment No. 2 on Form 10-K/A filed by the Company on September 15, 2017 (the Second Amendment) with respect to the following Items. Item 8 Financial Statements and Supplementary Data, in order to supplement disclosure on how the Company determines values when accounting for equity-based compensation; and Item 15 Exhibits, Financial Statement Schedules, in order to reflect updated Exhibit 31 and 32 certifications, XBRL and other Exhibits. Item 1 Business is restated in the same form as set forth in the Second Amendment in light of the failure to file certifications with the Second Amendment. The modifications are in response to comments by the SEC staff on the Second Amendment. In this Amendment, we set forth in their entirety Items that are being amended and have omitted Items that are not being amended. Any Items set forth in this Amendment supersede in its entirety the same Item included in the Amendment. This Amendment should be read as an integrated Report together with the portions of the First Amendment or Second Amendment that are not superseded hereby. | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Public Float | $ 13,367,160 | ||
Entity Common Stock, Shares Outstanding | 25,659,409 | ||
Entity Trading Symbol | FRES | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2,016 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Current Assets | ||
Cash | $ 28,922 | $ 451,526 |
Accounts receivable, net of allowance for doubtful accounts of $0 and $194,467, respectively | ||
Inventory | 35,174 | |
Prepaid expenses | 8,831 | 30,520 |
Total Current Assets | 37,753 | 517,220 |
Inventory, noncurrent | 291,559 | 206,722 |
Property and equipment, net of accumulated depreciation | 82,917 | 106,541 |
Intangible assets, net of accumulated amortization | 165,738 | 175,300 |
Total Assets | 577,967 | 1,005,783 |
Current Liabilities | ||
Accounts payable | 358,477 | 97,849 |
Accrued liabilities | 264,698 | 138,683 |
Related-party notes payable | 105,000 | 25,000 |
Current portion of long-term debt | 32,000 | 189,389 |
Total Current Liabilities | 760,175 | 450,921 |
Long-Term Liabilities | ||
Long-term debt, net of current portion | 2,653,370 | 3,206,931 |
Total Long-Term Liabilities | 2,653,370 | 3,206,931 |
Total Liabilities | 3,413,545 | 3,657,852 |
Stockholders' Deficit: | ||
Preferred stock, $0.001 par value; 10,000,000 shares authorized; none issued and outstanding | ||
Common stock, $0.001 par value; 40,000,000 shares authorized; 24,006,515 shares and 21,525,126 shares issued and outstanding, respectively | 24,007 | 21,525 |
Additional paid-in capital | 13,226,048 | 10,636,583 |
Accumulated deficit | (16,085,633) | (13,310,177) |
Total Stockholders' Deficit | (2,835,578) | (2,652,069) |
Total Liabilities and Stockholder' Deficit | $ 577,967 | $ 1,005,783 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful of accounts receivable | $ 0 | $ 194,467 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | ||
Preferred stock, shares outstanding | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 40,000,000 | 40,000,000 |
Common stock, shares issued | 24,006,515 | 21,525,126 |
Common stock, shares outstanding | 24,006,515 | 21,525,126 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Revenues: | ||
Revenue | $ 8,800 | $ 19,450 |
Total revenue | 8,800 | 19,450 |
Cost of revenue | 10,193 | 15,563 |
Gross margin | (1,393) | 3,887 |
Operating expenses: | ||
Research and development expense | 1,219,189 | 1,250,723 |
Selling, general and administrative expense | 1,288,960 | 1,257,557 |
Total operating expenses | 2,508,149 | 2,508,280 |
Loss from operations | (2,509,542) | (2,504,393) |
Other expense: | ||
Interest expense | (265,914) | (271,984) |
Foreign currency exchange loss, net | (24,093) | |
Total other expense | (265,914) | (296,077) |
Net loss | $ (2,775,456) | $ (2,800,470) |
Basic and diluted loss per share | $ (0.12) | $ (0.14) |
Weighted-average common shares outstanding, basic and diluted | 22,739,569 | 20,344,262 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Deficit - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Total |
Balance at Dec. 31, 2014 | $ 19,730 | $ 9,075,590 | $ (10,509,707) | $ (1,414,387) |
Balance, shares at Dec. 31, 2014 | 19,730,052 | |||
Stock-based compensation | 255,915 | 255,915 | ||
Common stock issued for cash | $ 294 | 146,706 | 147,000 | |
Common stock issued for cash, shares | 294,000 | |||
Common stock issued for cash | $ 1,235 | 925,225 | 926,460 | |
Common stock issued for cash, shares | 1,235,278 | |||
Common stock issued pursuant to bill of sale and patent assignment agreements | $ 150 | 112,350 | 112,500 | |
Common stock issued pursuant to bill of sale and patent assignment agreements, shares | 150,000 | |||
Common stock issued for conversion of note and accrued interest | $ 95 | 61,839 | 61,934 | |
Common stock issued for conversion of note and accrued interest, shares | 95,283 | |||
Issuance of warrants under consulting agreement | 43,594 | 43,594 | ||
Common stock issued for services | $ 21 | 15,364 | 15,385 | |
Common stock issued for services, shares | 20,513 | |||
Net loss | (2,800,470) | (2,800,470) | ||
Balance at Dec. 31, 2015 | $ 21,525 | 10,636,583 | (13,310,177) | (2,652,069) |
Balance, shares at Dec. 31, 2015 | 21,525,126 | |||
Stock-based compensation | 262,474 | 262,474 | ||
Common stock issued for conversion of note and accrued interest | $ 1,252 | 812,225 | 813,477 | |
Common stock issued for conversion of note and accrued interest, shares | 1,251,504 | |||
Common stock issued for services | $ 20 | 17,245 | 17,265 | |
Common stock issued for services, shares | 19,767 | |||
Common stock issued for cash and warrants, net of offering costs | $ 1,107 | 1,497,624 | 1,498,731 | |
Common stock issued for cash and warrants, net of offering costs, shares | 1,106,952 | |||
Common stock issued to placement agent | $ 103 | (103) | ||
Common stock issued to placement agent, shares | 103,166 | |||
Net loss | (2,775,456) | (2,775,456) | ||
Balance at Dec. 31, 2016 | $ 24,007 | $ 13,226,048 | $ (16,085,633) | $ (2,835,578) |
Balance, shares at Dec. 31, 2016 | 24,006,515 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Cash flows from operating activities: | ||
Net loss | $ (2,775,456) | $ (2,800,470) |
Adjustments to reconcile net loss to net cash flows from operating activities: | ||
Depreciation and amortization | 33,186 | 10,923 |
Stock-based compensation | 279,739 | 343,488 |
Obsolete inventory | 10,193 | |
Impairment loss | 50,000 | |
Provision for doubtful accounts | 102,282 | |
Change in assets and liabilities: | ||
Accounts receivable | 52,517 | |
Inventory | (59,856) | (31,422) |
Prepaid expenses | 21,689 | (20,474) |
Accounts payable | 260,628 | (7,467) |
Accrued liabilities | 196,542 | (255,719) |
Net cash flows from operating activities | (2,033,335) | (2,556,342) |
Cash flows from investing activities: | ||
Payments for property and equipment | (164,489) | |
Net cash flows from investing activities | 0 | (164,489) |
Cash flows from financing activities: | ||
Issuance of common stock and warrants for cash, net of offering costs | 1,498,731 | 1,073,460 |
Proceeds from issuance of convertible debentures | 2,000,000 | |
Proceeds from issuance of convertible notes payable | 1,206,931 | |
Payments on convertible notes payable | (40,000) | |
Payments on notes payable | (1,097,078) | |
Proceeds from notes payable | 32,000 | |
Proceeds from related party debt | 210,000 | 50,000 |
Payments on related party debt | (130,000) | (25,000) |
Net cash flows from financing activities | 1,610,731 | 3,168,313 |
Net increase (decrease) in cash | (422,604) | 447,482 |
Cash at beginning of period | 451,526 | 4,044 |
Cash at end of period | 28,922 | 451,526 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | 76,170 | 524,544 |
Cash paid for income taxes | ||
Supplemental disclosure of non-cash investing and financing activities: | ||
Conversion of convertible debt and interest | 813,477 | 61,934 |
Stock issued to placement agent | 103 | |
Common stock issued to acquire property and equipment, and intangible assets | $ 112,500 |
Organization and Summary of Sig
Organization and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Organization and Summary of Significant Accounting Policies | Note 1 – Organization and Summary of Significant Accounting Policies Organization Principles of Consolidation Basis of Presentation The Company has the ability to maintain current levels of spending or reduce expenditures significantly if funding is not available. Additionally, should FDA approval be obtained, the Company could execute on an aggressive marketing plan that would require significant additional funding; however, this plan would not begin until funding is in place. As discussed in Note 13, subsequent to December 31, 2016, the Company sold 2,256,634 units from its on-going Private Placement Memorandum for approximately $3.4 million. Additionally, the Company converted outstanding debt of approximately $1.3 million to equity, and paid debt and accrued interest of approximately $0.5 million. Therefore, approximately $1.8 million of liabilities on the December 31, 2016 balance sheet were converted to equity or repaid subsequent to December 31, 2016. The Company’s financial statements for the prior year ended December 31, 2015 disclosed substantial doubt about the Company’s ability to continue as a going concern. Based on management’s plans and the significant capital raised during subsequent to the year ended December 31, 2016, that substantial doubt has been alleviated. Use of Estimates Fair Value of Financial Instruments Research and Development Cash and Cash Equivalents Inventory Property and Equipment Intangible Assets Revenue Recognition Trade Receivables and Credit Policies Employee Stock-based Compensation Non-Employee Stock-based Compensation The Company recognizes stock-based compensation to non-employees over the same periods as if the Company had paid cash for the goods or services. The measurement of stock-based compensation is subject to periodic adjustment as the underlying equity instruments vest. Income Taxes Basic and Diluted Loss Per Share and 2015, the following items were excluded from the computation of diluted net loss per common share as their effect is anti-dilutive: For the Years Ended December 31, 2016 2015 Warrants to purchase shares 3,447,386 1,423,211 Restricted common stock grants 872 253,670 Convertible debentures 2,198,850 3,253,279 Convertible notes 1,641,692 1,609,242 Foreign Currency Policy – Related Parties Recent Accounting Pronouncements In March 2016, the FASB issued ASU 2016-09, Stock Compensation |
Inventory
Inventory | 12 Months Ended |
Dec. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Inventory | Note 2 – Inventory Inventory principally consists of the cost of materials purchased and assembled during the years ended December 31, 2016 and 2015. The cost of inventory also includes the costs of direct labor for the assembly and certain indirect costs incurred in connection with purchasing of parts and the assembly of products. Inventory consists of the following: December 31, 2016 2015 Raw materials $ 69,264 $ 76,925 Work in progress 31,185 58,376 Finished goods 191,110 106,595 Total inventory 291,559 241,896 Less carrying value of inventory not deemed to be a current asset 291,559 206,722 Inventory, included in current assets $ - $ 35,174 In an effort to create a unified marketing image, inventory recorded at $10,193, which consisted of older packaging materials was written off during the year ended December 31, 2016 and is reported as cost of revenues in the accompanying statement of operations. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Note 3 – Property and Equipment Property and equipment consists of the following at December 31, 2016 and 2015: December 31, Life 2016 2015 Computer equipment 3 years $ 19,787 $ 19,787 Office equipment 3 to 5 years 13,852 13,852 Tooling 5 years 92,228 92,228 125,867 125,867 Less accumulated depreciation (42,950 ) (19,326 ) Property and equipment, net $ 82,917 $ 106,541 Depreciation expense for the years ended December 31, 2016 and 2015 was $23,624 and $10,923, respectively. Effective January 2014, the Company entered into a Master Services Agreement (the “Agreement”) with an entity that provides consulting and professional services to develop an internet-based customer service portal. The entity is owned and managed by a former director of the Company. By December 31, 2015, the Company had paid a total of $50,000 under the Agreement in full satisfaction of amounts owed for services provided under the Agreement. With this payment, the Agreement was terminated. With the termination of the Agreement, management evaluated the status of this project in light of its plan for the future development and completion of the project and concluded that the $50,000 of costs paid and recorded will not have a significant future benefit. Accordingly, an impairment loss of $50,000 was recorded at December 31, 2015. |
Accrued Liabilities
Accrued Liabilities | 12 Months Ended |
Dec. 31, 2016 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities | Note 4 – Accrued Liabilities Accrued liabilities consisted of the following at December 31, 2016 and 2015: December 31, 2016 2015 Accrued interest $ 234,405 $ 115,627 Accrued royalties 17,873 5,183 Accrued payroll and payroll taxes 12,420 17,873 Total accrued liabilities $ 264,698 $ 138,683 Related party accrued interest was 35,519 and 1,012 at December 31, 2016 and 2015 respectively. |
Short and Long-term Debt
Short and Long-term Debt | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Short and Long-term Debt | Note 5 –Short and Long-term Debt Short and Long-term debt is summarized as follows: December 31, 2016 2015 Convertible debentures; unsecured; interest at 8.00% per annum; due May 1, 2018; $742,950 was converted to common stock during the year ended December 31, 2016 $ 1,257,050 $ 2,000,000 Convertible notes payable; unsecured; interest at 8.00% per annum; due November 6, 2020 1,206,931 1,206,931 Note payable secured by all the assets of the Company; interest at 15.00% per annum; due June 30, 2018 189,389 189,389 Unsecured Note payable; interest at 10.00% per annum; due on demand 32,000 - Total long-term debt 2,685,370 3,396,320 Less: current portion 32,000 189,389 Long-term debt, net of current portion $ 2,653,370 $ 3,206,931 During the year ended December 31, 2016, notes totaling $32,000 became due. These notes are now considered due on demand and are recorded as current notes payable. Maturities on long-term debt are as follows: Year ending December 31, 2017 $ 32,000 2018 1,446,439 2019 - 2020 1,206,931 2021 - Note Payable Secured by the Assets of the Company During the year ended December 31, 2015, the Company paid off the remaining principal of a master note to a shareholder of $929,536 and accrued interest of $310,770. Total interest expense related to this note for the year ended December 31, 2015 was $87,028. Other Convertible Notes During the year ended December 31, 2015, one note payable in the amount of $40,000 and related accrued interest of $9,837 were paid off for cash. During the year ended December 31, 2015, a note payable in the amount of $50,000 and related accrued interest of $11,934 was converted into 95,283 shares of the Company’s common stock, at $0.65 per share. Note Payable to a Relative of an Executive Officer At December 31, 2016 and 2015, the Company was obligated under the terms of a master note to an individual related to an executive officer of the Company in the amount of $189,389. During the year ended December 31, 2015, the Company paid $356,931 to the note holder, which paid all accrued interest in the amount of $189,389 as of the date of the payment and the remainder of the payment was applied to reduce the principal of the note by $167,542, leaving a balance of $189,389. The note is secured by all the assets of the Company, bears interest at 15 percent per annum, and requires the board of directors to retain the current management as long as the note is outstanding. The note was extended on June 30, 2016 and is now due September 30, 2018. The balance of accrued interest at December 31, 2016 and 2015 was $29,498 and $1,012, respectively. As part of the extension of the due date, the Company analyzed the note and determined that the change in due date did not qualify as a debt modification under generally accepted accounting principles and accordingly, classified the note as long-term. As described in Note 13, the remainder of the principal and interest was either converted or repaid subsequent to year end. Convertible Debentures In 2015, the Company issued $2,000,000 in Convertible Debentures. The Convertible Debentures are unsecured and bear interest at the rate of 8% per annum. Principal and accrued interest are due on the maturity date, which is May 1, 2018. The holder of the Convertible Debenture is entitled, at its option, to convert all or any portion of the outstanding principal of the Convertible Debenture into shares of the Company’s common stock at a conversion price of $0.65 per share. Interest accruing from the date of issuance to the conversion date shall be paid on the maturity date. The Company evaluated the Convertible Debentures for consideration of any beneficial conversion features as required under generally accepted accounting principles. The Company determined that there was no beneficial conversion feature. As further described in Note 6 to these consolidated financial statements, the Company entered into a Placement Agent Agreement, effective December 28, 2015, that provides for compensation to a Placement Agent in connection with an offering of common stock. Additionally, the Placement Agent Agreement provides for potential compensation to the Placement Agent in connection with the future conversion of the Convertible Debentures into shares of common stock of the Company. Upon the conversion of the Convertible Debentures, the Company shall issue the Placement Agent warrants to acquire shares of the Company’s common stock at an exercise price of $0.65 per share. On a quarterly basis, the Placement Agent will be issued a warrant to purchase one share of common stock for each $0.81 of the principal amount of the Convertible Debentures converted into common stock during the quarter, with the maximum number of warrants issuable under the Placement Agreement limited to 2,643,460 shares of the Company’s common stock. The term of the warrants shall be for a period of 36 months from the date of issuance. As of December 31, 2016, $742,950 of principal and accrued interest of $70,525 were converted into 1,251,504 shares of common stock. As described in Note 13, the remainder of the principal and interest was either converted or repaid subsequent to year end. Convertible Notes Payable On November 6, 2015, the Company issued two convertible promissory notes (the “Convertible Notes”) in the aggregate principal amount of $1,206,931 to two investment entities controlled by a single family. In the same transaction, the investment entities purchased an aggregate of 66,666 shares of common stock for a purchase price of $50,000, or $0.75 per share. The Convertible Notes are unsecured and accrue interest at the rate of 8% per annum, with interest payable on the last day of each calendar quarter. The principal amount under the Convertible Notes is due on the five-year anniversary of the issue date. The Convertible Notes are convertible at any time prior to maturity at the option of the holders at a conversion rate of $0.75 per share. If the Company’s common stock commences trading and closes at a price of $3.50 per share for five consecutive trading days, the principal amount under the Convertible Notes automatically converts into common stock at the rate of $0.75 per share. Proceeds from the Convertible Notes were to be used for the purpose of retirement of long-term debt. The Company evaluated the Convertible Notes for consideration of any beneficial conversion features as required under generally accepted accounting principles. The Company determined that there was no beneficial conversion feature. Other Notes Payable On August 16, 2016, the Company issued an unsecured bridge note to an individual for $32,000 with an interest rate of 8%. This note was originally due on September 30, 2016, and is now due on demand. As of December 31, 2016, there is a balance of $1,461 in accrued interest related to this note. As described in Note 13, this principal and interest was repaid subsequent to year end. Related-Party Notes Payable During the year ended December 31, 2016 the Company issued notes to related parties for $210,000. Also during the year ended December 31, 2016, $105,000 of those notes were paid back along with interest and fees of $3,089. On December 18, 2015, the Company entered into a Patent Assignment Agreement for the acquisition of certain patent application rights. Prior to the execution of the Patent Assignment Agreement, a member of the Company’s board of directors advanced $50,000 on behalf of the Company to the seller under the Patent Assignment Agreement. The advance did not bear interest, was unsecured, and did not offer conversion terms at any time. In December 2015, the Company repaid $25,000, and as described in Note 13, the remainder of the principal and interest was repaid subsequent to year end. |
Preferred Stock
Preferred Stock | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Preferred Stock | Note 6 – Preferred Stock The stockholders of the Company have authorized 10,000,000 shares of preferred stock, par value $0.001 per share. The preferred stock may be issued in one or more series. The board of directors has the right to fix the number of shares of each series (within the total number of authorized shares of the preferred stock available for designation as a part of such series), and designate, in whole or part, the preferences, limitations and relative rights of each series of preferred stock. As of December 31, 2016 and 2015, the board of directors has not designated any series of preferred stock and there are no shares of preferred stock issued or outstanding. |
Common Stock
Common Stock | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Common Stock | Note 7 – Common Stock Common Stock Issued for Cash The Company signed a Private Placement Memorandum dated December 28, 2015 to offer a maximum of 3,500,000 shares of its common stock at a price of $1.50 per share. On July 7, 2016, the board of directors authorized changing the offering to be units of one share of common stock and one warrant, sold for a price of $1.50 per unit. This change was applied retroactively to all purchasers under the Private Placement Memorandum. The units are being offered on a “best efforts” basis. During the year ended December 31, 2016, 1,106,952 units were subscribed, conditions for the minimum offering were met, and the Company received net proceeds of $1,498,731 from the offering. Concurrently with the Private Placement Memorandum, the Company entered into a Placement Agent Agreement, effective December 28, 2015, that provides for compensation to a Placement Agent in connection with the offering of common stock. Pursuant to the Placement Agent Agreement, the Company will pay the Placement Agent a cash commission of ten percent of the issuance price of the common stock sold in the offering, and one share of common stock of the Company for each ten shares of the Company’s common stock sold in the offering. Pursuant to these provisions, with the release of shares described in the previous paragraph, the Company incurred commission fees to the Placement Agent of $166,043 and has issued the Placement Agent 103,166 shares of common stock. The Placement Agent will also receive an expense allowance of up to $10,000 to reimburse it for direct out-of-pocket costs related to the offering and the Escrow Agent was paid $1,000 for services in connection with the offering. Legal fees of $6,949 were also paid in connection with the offering. During the three months ended March 31, 2015, the Company issued 294,000 shares of common stock for cash. Proceeds from these issuances total $147,000, or $0.50 per share. During the nine months ended December 31, 2015, the Company issued 1,235,278 shares of common stock for cash. Proceeds from these issuances total $926,460, or $0.75 per share. Certain of these issuances were the result of the Company receiving proceeds in excess of the number of Convertible Debentures authorized by the Company’s board of directors. These investors opted to purchase shares of common stock in the Company at $0.75 per share in accordance with the provisions of the convertible debentures. Common Stock Issued for Conversion of Debt During the year ended December 31, 2016, certain convertible debenture holders exercised their right and converted $742,950 of principal and $70,527 of accrued interest into common stock. The Company issued 1,251,504 shares of common stock at $0.65 per share in accordance with the provisions of the convertible debentures. During the year ended December 31, 2015, a convertible note payable in the amount of $50,000 and related accrued interest of $11,934 was converted into 95,283 shares of the Company’s common stock, at $0.65 per share. Common Stock Issued Pursuant to Bill of Sale and Patent Assignment Agreements On December 18, 2015, the Company entered into a Bill of Sale Agreement and a Patent Assignment Agreement with an individual. Pursuant to the two agreements, the Company acquired a) inventory with an estimated value of $2,200; b) molds with an estimated value of $35,000; and c) certain patent application rights with an estimated value of $175,300. Total consideration given for these assets was cash in the amount of $100,000 and 150,000 shares of the Company’s common stock, valued at $0.75 per share, or $112,500. The value assigned to the common stock was based on the price per share that common stock was most-recently issued to third parties for cash. Common Stock Issued for Services Periodically, the Company issues restricted common stock grants to directors, officers and consultants as compensation for future services. During the year ended December 31, 2016, the Company recognized $126,400 in stock compensation expense related to the amortization of this deferred compensation. In addition, in August 2016, the Company issued 19,767 shares of common stock with a total value of $17,265 ($0.87 per share) to two consultants for services rendered. The services related to marketing efforts. The Company and consultants agreed the fair value of the stock was more reliable than the value of the services. The Company did not have an active trading market for its common stock and the stock was valued at the most recent sale of common stock for cash. During 2016, the Company had a private placement ongoing in which it would sell an equity unit for $1.50. Each equity unit consisted of one share of stock and one warrant to purchase a share of stock at $1.50. As further discussed in Note 8 Common Stock Warrants In November 2015, the Company issued 20,513 shares to employees, directors, and consultants as compensation for current services valued at $15,385 ($0.75 per share). The consultants and directors could not provide a reliable value on the services rendered and agreed the value of the common shares was more reliable. As the Company did not have an active trading market for its common shares, the shares were valued at the most recent sale of common stock for cash. The Company had a private placement ongoing during 2015 of $0.75 per share. The Company recognized stock-based compensation related to the shares issued to directors, officers and consultants for the year ended December 31, 2015 of $255,915. A summary of the status of the Company’s restricted common stock grants as of December 31, 2016 and changes during the year then ended, is presented below: Weighted Restricted Average Common Common Stock Stock Grants Price Balance at December 31, 2014 765,500 $ 0.50 Awarded - - Vested (511,830 ) 0.50 Balance at December 31, 2015 253,670 0.50 Awarded - - Vested (252,798 ) 0.50 Balance at December 31, 2016 872 $ 0.50 As of December 31, 2016, there was $436 of total unrecognized compensation cost related to the restricted common stock grants and the stock-based compensation arrangements awarded to directors, officers, and consultants. That cost is expected to be recognized over a weighted-average period of 0.02 years. Total stock-based compensation expense from all sources for the year ended December 31, 2016 and 2015, including stock-based compensation for the warrants and related amortization discussed below in Note 8, has been included in the consolidated statements of operations as follows: For the Years Ended December 31, 2016 2015 Research and development expense $ 166,626 $ 165,342 Selling, general and administrative expense 113,114 178,146 Total share-based compensation $ 279,739 $ 343,488 |
Common Stock Warrants
Common Stock Warrants | 12 Months Ended |
Dec. 31, 2016 | |
Other Liabilities [Abstract] | |
Common Stock Warrants | Note 8 – Common Stock Warrants The Company has issued warrants to purchase its common stock for the following: 1) consulting services; 2) extension of a note payable, and 3) in conjunction with common share purchases. The fair value of warrants issued for consulting services is recognized as consulting expense at the date the warrants become exercisable which is the same time period had the Company paid cash for the goods or services. The Company values warrants based on the fair value of the stock on the date of issuance and records compensation over the requisite service period which is usually the vesting period. The non-vested shares are included in the total outstanding shares recorded in the consolidated financial statements. The fair value of warrants was estimated using the Black-Scholes option pricing model with volatility based on peer group companies. The fair value of the warrants that vested during the year ended December 31, 2016 was $0.76 per share. The fair value of the warrants that vested during the year ended December 31, 2015 was $0.402 per share. Management used the following inputs to value the warrants for the year ended December 31, 2016: For the Years Ended December 31, 2016 2015 Expected life 4.5 years 5.2 years Exercise price $ 0.50 $ 0.50 Expected volatility 124 % 71 % Expected dividends None None Risk-free interest rate 1.33 % 1.70 % The Company recognized $136,074 of share-based compensation and additional paid in capital during the year ended December 31, 2016 and $43,594 of share-based compensation and additional paid-in capital in addition to $28,594 in amortization related to the vesting of warrants for the year ended December 31, 2015. Pursuant to the Private Placement Memorandum discussed in Note 7, the Company issued, to the investors, one warrant to purchase a share of common stock at a price of $1.50 for each share purchased. The Company issued 1,106,952 warrants under these terms. The fair value of warrants was estimated using the Black-Scholes option pricing model with the following weighted-average assumptions: risk-free interest rate of 1.02%, expected volatility 141%, expected life 2.12 years, expected dividend yield of zero. The proceeds of the private placement were allocated to the stock and warrants based on their relative fair values with $688,644 being allocated to the warrants. In addition, as noted in Note 7 above, the Private Placement Memorandum requires the Company to issue, to the Placement Agent, a warrant to purchase one share of common stock at a price of $0.65 for each $0.81 of the principal amount of the outstanding 8% Convertible Debentures that is converted into Common Stock of the Company. During the year ended December 31, 2016, certain convertible debenture holders exercised their right and converted $742,950 of principal which resulted in 917,223 warrants issued to the Placement Agent. A summary of warrant activity for the years ended December 31, 2016 and 2015 is presented below: Weighted Aggregate Weighted Average Intrinsic Shares Average Remaining Value of Under Exercise Contractual Vested Warrants Price Life Warrants Outstanding at December 31, 2014 1,423,211 $ 0.54 8.3 years $ 17,640 Issued - - Exercised - - Expired - - Outstanding at December 31, 2015 1,423,211 $ 0.54 7.3 years $ 213,364 Issued 2,024,175 1.26 Exercised - - Expired - - Outstanding at December 31, 2016 3,447,386 $ 0.88 4.2 years $ 546,333 The intrinsic value at December 31, 2016 is calculated at $0.85 per share less the exercise price, based on management’s latest estimate of the fair value of the shares of common stock, which is the latest price the Company issued shares of common stock for cash. |
Intangible Assets
Intangible Assets | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Note 9 – Intangible Assets In December 2015, the Company purchased patents for a probe as well as enhanced surface and tips for obtaining bioelectrical signals for $175,300 comprised of $62,800 in cash and 150,000 shares of common stock. These patents will be amortized at a rate of $797 per month, or $9,562 per year, over the 220-month remaining life of the patents. During the years ended December 31, 2016 and 2015 the Company recognized amortization expense of $9,562 and $0, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 10 – Commitments and Contingencies Consulting Representation Agreement On January 1, 2016, the Company entered into a Consulting Representation Agreement with two consultants located in the European Union. Pursuant to the Consulting Representation Agreement, the consultants agreed to complete certain marketing milestones related to relationship development with key government and regulatory officials in the European Union and the introduction and marketing of the Company’s products to potential medical, clinical and hospital customers of the member states of the European Union. This Consulting Representation Agreement was terminated during the year ended December 31, 2016 due to failure of the consultants to perform. During the year ended December 31, 2016, the Company has issued 10,000 shares of common stock in accordance with this agreement. Lease Agreement The Company leases office space under an agreement that expires in 2017, with an option to renew with a 3% annual rent escalation. Monthly rental payments as of December 31, 2016 are $3,940 per month. Lease expense charged to operations for the years ended December 31, 2016 and 2015 was $49,469 and $48,649, respectively. License Agreement The Company has a license agreement with a party related through a shareholder and former member of the board of directors. Under the agreement, the Company has the right to the exclusive use of certain patents pending and related technology (the “technology”) in its medical devices and other products for an indefinite term. In return, the Company agreed to incur a minimum of $4,750,000 in development costs by the year 2014 to develop and market its products worldwide based on a graduated schedule and to make royalty payments based on a percentage of the aggregate worldwide net sales (as defined in the agreement) of its medical device and other products that utilize the technology. The minimum expenditure of $4,750,000 was achieved. At December 31, 2016 and 2015, accrued royalties under this license agreement total $17,873, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 11 – Income Taxes The Company provides for income taxes using an asset and liability based approach. Deferred income tax assets and liabilities are recorded to reflect the future tax consequences of temporary differences between the financial statement and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. The significant components of net deferred tax assets (liabilities) were as follows at December 31, 2016 and 2015: 2016 2015 Net operating losses $ 4,841,700 $ 3,776,478 Research and development credit carryforward 129,500 75,004 Related-party accruals 2,300 - Allowance for doubtful accounts - 75,842 Stock based compensation - 57,253 Depreciation and amortization 15,500 (4,477 ) Change in valuation allowance (4,989,000 ) (3,980,100 ) Net Deferred Tax Asset $ - $ - As of December 31, 2016, the Company had no unrecognized tax benefits that, if recognized, would affect the Company’s effective income tax rate over the next 12 months. A reconciliation of the expected income tax benefit at the U.S. Federal income tax rate to the income tax benefit actually recognized for the years ended December 31, 2016 and 2015 is set forth below: 2016 2015 Net loss $ (1,082,400 ) $ (952,160 ) Non-deductible expenses 110,300 (8,824 ) Valuation allowance 972,100 960,984 Benefit from Income Taxes $ - $ - As of December 31, 2016, the Company has a net operating loss carry-forward for U.S. federal income tax purposes of approximately $12.2 million. This carry-forward is available to offset future taxable income, if any, and will expire, if not used, from 2017 through 2036. The utilization of the net operating loss carry-forward is dependent upon the tax laws in effect at the time the net operating loss carry-forward can be utilized and may be limited by changes in ownership control of the Company. The Company’s U.S. federal and Utah income tax returns, constituting the returns of the major taxing jurisdictions, are subject to examination by the taxing authorities for all open years as prescribed by applicable statute. No income tax waivers have been executed that would extend the period subject to examination beyond the period prescribed by statute. The Company is no longer subject to U.S. federal tax examinations for tax years before and including December 31, 2012. The Company is no longer subject to Utah state tax examinations for tax years before and including December 31, 2010. During the years ended December 31, 2016 and 2015, the Company did not incur interest and penalties. |
Other Related Party Transaction
Other Related Party Transactions | 12 Months Ended |
Dec. 31, 2016 | |
Related Party Transactions [Abstract] | |
Other Related Party Transactions | Note 12 – Other Related Party Transactions During the year ended December 31, 2016, the Company has consulting agreements in place with two of the members of its board of directors. These directors provide marketing and medical advisory services. One of the agreements was terminated during the year ended December 31, 2016. The remaining consulting agreement may be terminated by either the Company or by the consultant at any time and for any reason. During the year ended December 31, 2016, these directors were paid a total of $161,000 under these agreements. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 13 – Subsequent Events The Company evaluated all subsequent events that occurred after the balance sheet date through April 17, 2017, the date its financial statements were available to be issued, and concluded there were additional events and transactions occurring during this period that required recognition or disclosure in the financial statements. Subsequent to December 31, 2016, the Company sold 2,256,634 shares under the Private Placement Memorandum discussed in Note 7 for cash received of $3,384,952. Subsequent to December 31, 2016, the remaining balance of the note payable to a relative of an executive officer was converted or repaid as follows: 1) the Company issued 66,667 shares of common stock as well as 66,667 warrants to purchase stock at a price of $1.50 for conversion of debt principal of $100,000, and 2) the Company repaid the remaining principal of $89,389 and accrued interest payable of $39,071. Any and all security interest held by the noteholder was released to the Company. Subsequent to December 31, 2016, the remaining balance of convertible debentures was converted or repaid as follows: 1) the Company issued 1,752,274 shares of common stock for conversion of debenture principal of $991,550 and accrued interest payable of $147,428, and 2) the Company repaid the remaining principal of $265,500 and accrued interest payable of $41,607. Subsequent to December 31, 2016, the Company repaid the other note payable of $32,000. Subsequent to December 31, 2016, the remaining balance of the related-party notes payable were converted or repaid as follows: 1) the Company issued 40,000 shares of common stock as well as 40,000 warrants to purchase stock at a price of $1.50 for conversion of debt principal of $60,000, and 2) the Company repaid the remaining principal, interest and fees of $52,300. |
Organization and Summary of S20
Organization and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Organization | Organization |
Principles of Consolidation | Principles of Consolidation |
Basis of Presentation | Basis of Presentation The Company has the ability to maintain current levels of spending or reduce expenditures significantly if funding is not available. Additionally, should FDA approval be obtained, the Company could execute on an aggressive marketing plan that would require significant additional funding; however, this plan would not begin until funding is in place. As discussed in Note 13, subsequent to December 31, 2016, the Company sold 2,256,634 units from its on-going Private Placement Memorandum for approximately $3.4 million. Additionally, the Company converted outstanding debt of approximately $1.3 million to equity, and paid debt and accrued interest of approximately $0.5 million. Therefore, approximately $1.8 million of liabilities on the December 31, 2016 balance sheet were converted to equity or repaid subsequent to December 31, 2016. The Company’s financial statements for the prior year ended December 31, 2015 disclosed substantial doubt about the Company’s ability to continue as a going concern. Based on management’s plans and the significant capital raised during subsequent to the year ended December 31, 2016, that substantial doubt has been alleviated. |
Use of Estimates | Use of Estimates |
Fair Value of Financial Instruments | Fair Value of Financial Instruments |
Research and Development | Research and Development |
Cash and Cash Equivalents | Cash and Cash Equivalents |
Inventory | Inventory |
Property and Equipment | Property and Equipment |
Intangible Assets | Intangible Assets |
Revenue Recognition | Revenue Recognition |
Trade Receivables and Credit Policies | Trade Receivables and Credit Policies |
Employee Stock-based Compensation | Employee Stock-based Compensation |
Non-employee Stock-based Compensation | Non-Employee Stock-based Compensation The Company recognizes stock-based compensation to non-employees over the same periods as if the Company had paid cash for the goods or services. The measurement of stock-based compensation is subject to periodic adjustment as the underlying equity instruments vest. |
Income Taxes | Income Taxes |
Basic and Diluted Loss Per Share | Basic and Diluted Loss Per Share and 2015, the following items were excluded from the computation of diluted net loss per common share as their effect is anti-dilutive: For the Years Ended December 31, 2016 2015 Warrants to purchase shares 3,447,386 1,423,211 Restricted common stock grants 872 253,670 Convertible debentures 2,198,850 3,253,279 Convertible notes 1,641,692 1,609,242 |
Foreign Currency Policy | Foreign Currency Policy – |
Related Parties | Related Parties |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In March 2016, the FASB issued ASU 2016-09, Stock Compensation |
Organization and Summary of S21
Organization and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Schedule of Warrants to Purchase Shares of Common Stock | As of and 2015, the following items were excluded from the computation of diluted net loss per common share as their effect is anti-dilutive: For the Years Ended December 31, 2016 2015 Warrants to purchase shares 3,447,386 1,423,211 Restricted common stock grants 872 253,670 Convertible debentures 2,198,850 3,253,279 Convertible notes 1,641,692 1,609,242 |
Inventory (Tables)
Inventory (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventory consists of the following: December 31, 2016 2015 Raw materials $ 69,264 $ 76,925 Work in progress 31,185 58,376 Finished goods 191,110 106,595 Total inventory 291,559 241,896 Less carrying value of inventory not deemed to be a current asset 291,559 206,722 Inventory, included in current assets $ - $ 35,174 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment consists of the following at December 31, 2016 and 2015: December 31, Life 2016 2015 Computer equipment 3 years $ 19,787 $ 19,787 Office equipment 3 to 5 years 13,852 13,852 Tooling 5 years 92,228 92,228 125,867 125,867 Less accumulated depreciation (42,950 ) (19,326 ) Property and equipment, net $ 82,917 $ 106,541 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Liabilities | Accrued liabilities consisted of the following at December 31, 2016 and 2015: December 31, 2016 2015 Accrued interest $ 234,405 $ 115,627 Accrued royalties 17,873 5,183 Accrued payroll and payroll taxes 12,420 17,873 Total accrued liabilities $ 264,698 $ 138,683 |
Short and Long-term Debt (Table
Short and Long-term Debt (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt | Short and Long-term debt is summarized as follows: December 31, 2016 2015 Convertible debentures; unsecured; interest at 8.00% per annum; due May 1, 2018; $742,950 was converted to common stock during the year ended December 31, 2016 $ 1,257,050 $ 2,000,000 Convertible notes payable; unsecured; interest at 8.00% per annum; due November 6, 2020 1,206,931 1,206,931 Note payable secured by all the assets of the Company; interest at 15.00% per annum; due June 30, 2018 189,389 189,389 Unsecured Note payable; interest at 10.00% per annum; due on demand 32,000 - Total long-term debt 2,685,370 3,396,320 Less: current portion 32,000 189,389 Long-term debt, net of current portion $ 2,653,370 $ 3,206,931 |
Schedule of Maturities of Long-term Debt | Maturities on long-term debt are as follows: Year ending December 31, 2017 $ 32,000 2018 1,446,439 2019 - 2020 1,206,931 2021 - |
Common Stock (Tables)
Common Stock (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Company's Nonvested Shares | A summary of the status of the Company’s restricted common stock grants as of December 31, 2016 and changes during the year then ended, is presented below: Weighted Restricted Average Common Common Stock Stock Grants Price Balance at December 31, 2014 765,500 $ 0.50 Awarded - - Vested (511,830 ) 0.50 Balance at December 31, 2015 253,670 0.50 Awarded - - Vested (252,798 ) 0.50 Balance at December 31, 2016 872 $ 0.50 |
Schedule of Compensation Cost for Share-based Payment Arrangements, Allocation of Share-based Compensation Costs by Plan | Total stock-based compensation expense from all sources for the year ended December 31, 2016 and 2015, including stock-based compensation for the warrants and related amortization discussed below in Note 8, has been included in the consolidated statements of operations as follows: For the Years Ended December 31, 2016 2015 Research and development expense $ 166,626 $ 165,342 Selling, general and administrative expense 113,114 178,146 Total share-based compensation $ 279,739 $ 343,488 |
Common Stock Warrants (Tables)
Common Stock Warrants (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Other Liabilities [Abstract] | |
Summary of Fair Value of the Warrants Assumptions | Management used the following inputs to value the warrants for the year ended December 31, 2016: For the Years Ended December 31, 2016 2015 Expected life 4.5 years 5.2 years Exercise price $ 0.50 $ 0.50 Expected volatility 124 % 71 % Expected dividends None None Risk-free interest rate 1.33 % 1.70 % |
Summary of Warrants Outstanding | A summary of warrant activity for the years ended December 31, 2016 and 2015 is presented below: Weighted Aggregate Weighted Average Intrinsic Shares Average Remaining Value of Under Exercise Contractual Vested Warrants Price Life Warrants Outstanding at December 31, 2014 1,423,211 $ 0.54 8.3 years $ 17,640 Issued - - Exercised - - Expired - - Outstanding at December 31, 2015 1,423,211 $ 0.54 7.3 years $ 213,364 Issued 2,024,175 1.26 Exercised - - Expired - - Outstanding at December 31, 2016 3,447,386 $ 0.88 4.2 years $ 546,333 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Net Deferred Tax Assets (Liabilities) | The significant components of net deferred tax assets (liabilities) were as follows at December 31, 2016 and 2015: 2016 2015 Net operating losses $ 4,841,700 $ 3,776,478 Research and development credit carryforward 129,500 75,004 Related-party accruals 2,300 - Allowance for doubtful accounts - 75,842 Stock based compensation - 57,253 Depreciation and amortization 15,500 (4,477 ) Change in valuation allowance (4,989,000 ) (3,980,100 ) Net Deferred Tax Asset $ - $ - |
Schedule of Effective Income Tax Rate Reconciliation | A reconciliation of the expected income tax benefit at the U.S. Federal income tax rate to the income tax benefit actually recognized for the years ended December 31, 2016 and 2015 is set forth below: 2016 2015 Net loss $ (1,082,400 ) $ (952,160 ) Non-deductible expenses 110,300 (8,824 ) Valuation allowance 972,100 960,984 Benefit from Income Taxes $ - $ - |
Organization and Summary of S29
Organization and Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Net losses | $ 2,775,456 | $ 2,800,470 |
Cash used in operating activities | 2,033,335 | 2,556,342 |
Paid debt and accrued interest | 29,498 | 1,012 |
Liabilities | 3,413,545 | 3,657,852 |
Provision for doubtful accounts | 102,282 | |
Allowance for doubtful accounts | $ 0 | 194,467 |
Tax benefits recognized, description | The tax benefits recognized in the financial statements from such positions are then measured based on the largest benefit that has a greater than 50% likelihood of being realized upon settlement. | |
Foreign currency exchange loss | $ 24,093 | |
Minimum [Member] | ||
Property and equipment useful lives | 3 years | |
Maximum [Member] | ||
Property and equipment useful lives | 5 years | |
Private Placement [Member] | ||
Company sold unit, share | 2,256,634 | |
Company sold unit, value | $ 3,400,000 | |
Converted outstanding debt | 1,300,000 | |
Paid debt and accrued interest | 500,000 | |
Liabilities | $ 1,800,000 |
Organization and Summary of S30
Organization and Summary of Significant Accounting Policies - Schedule of Warrants to purchase shares of common stock (Details) - shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Warrants to Purchase Shares [Member] | ||
Antidilutive securities excluded from computation of earnings per share | 3,447,386 | 1,423,211 |
Restricted Common Stock Grants [Member] | ||
Antidilutive securities excluded from computation of earnings per share | 872 | 253,670 |
Convertible Debentures [Member] | ||
Antidilutive securities excluded from computation of earnings per share | 2,198,850 | 3,253,279 |
Convertible Notes [Member] | ||
Antidilutive securities excluded from computation of earnings per share | 1,641,692 | 1,609,242 |
Inventory (Details Narrative)
Inventory (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Inventory Disclosure [Abstract] | ||
Obsolete inventory | $ 10,193 |
Inventory - Schedule of Invento
Inventory - Schedule of Inventory (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 69,264 | $ 76,925 |
Work in progress | 31,185 | 58,376 |
Finished goods | 191,110 | 106,595 |
Total inventory | 291,559 | 241,896 |
Less carrying value of inventory not deemed to be a current asset | 291,559 | 206,722 |
Inventory, included in current assets | $ 35,174 |
Property and Equipment (Details
Property and Equipment (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Depreciation expense | $ 23,624 | $ 10,923 |
Payment to property and equipment | 164,489 | |
Impairment loss | 50,000 | |
Master Services Agreement [Member] | ||
Payment to property and equipment | 50,000 | |
Completion of the project and concluded costs paid | $ 50,000 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Property and equipment gross | $ 125,867 | $ 125,867 |
Less accumulated depreciation | (42,950) | (19,326) |
Property and equipment, net | $ 82,917 | 106,541 |
Minimum [Member] | ||
Property and equipment life | 3 years | |
Maximum [Member] | ||
Property and equipment life | 5 years | |
Computer Equipment [Member] | ||
Property and equipment life | 3 years | |
Property and equipment gross | $ 19,787 | 19,787 |
Office Equipment [Member] | ||
Property and equipment gross | $ 13,852 | 13,852 |
Office Equipment [Member] | Minimum [Member] | ||
Property and equipment life | 3 years | |
Office Equipment [Member] | Maximum [Member] | ||
Property and equipment life | 5 years | |
Tooling [Member] | ||
Property and equipment life | 5 years | |
Property and equipment gross | $ 92,228 | $ 92,228 |
Accrued Liabilities (Details Na
Accrued Liabilities (Details Narrative) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Payables and Accruals [Abstract] | ||
Related party accrued interest | $ 35,519 | $ 1,012 |
Accrued Liabilities - Schedule
Accrued Liabilities - Schedule of Accrued Liabilities (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Payables and Accruals [Abstract] | ||
Accrued interest | $ 234,405 | $ 115,627 |
Accrued royalties | 17,873 | 5,183 |
Accrued payroll and payroll taxes | 12,420 | 17,873 |
Total accrued liabilities | $ 264,698 | $ 138,683 |
Short and Long-term Debt (Detai
Short and Long-term Debt (Details Narrative) - USD ($) | Aug. 16, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 18, 2015 | Nov. 06, 2015 | Mar. 31, 2015 |
Note payable | $ 32,000 | |||||
Note principal payment paid off | $ 929,536 | |||||
Note accrued interest paid | 310,770 | |||||
Interest expense | 87,028 | |||||
Accrued interest | 29,498 | 1,012 | ||||
Convertible debentures issued | $ 1,206,931 | |||||
Common stock purchase price per share | $ 0.75 | $ 0.50 | ||||
Proceeds from issuance of related party debt | 210,000 | $ 50,000 | ||||
Repayment of principal and interest | 130,000 | 25,000 | ||||
Board of Directors [Member] | Patent Assignment Agreement [Member] | ||||||
Advance due | $ 50,000 | |||||
Other Convertible Notes [Member] | One Note Payable [Member] | ||||||
Note payable | 40,000 | |||||
Accrued interest | 9,837 | |||||
Other Convertible Notes [Member] | Note Payable [Member] | ||||||
Note payable | 50,000 | |||||
Accrued interest | $ 11,934 | |||||
Note payable converted into common shares, shares | 95,283 | |||||
Common stock conversion price per share | $ 0.65 | |||||
Master Note [Member] | ||||||
Note payable | $ 356,931 | |||||
Accrued interest | 189,389 | |||||
Note principal amount reduced | $ 167,542 | |||||
Note interest rate | 15.00% | |||||
Note payable due date | Sep. 30, 2018 | |||||
Master Note [Member] | Executive Officer [Member] | ||||||
Note payable | 189,389 | $ 189,389 | ||||
Convertible Debentures [Member] | ||||||
Accrued interest | $ 70,525 | |||||
Note payable converted into common shares, shares | 1,251,504 | |||||
Common stock conversion price per share | $ 0.65 | |||||
Note interest rate | 8.00% | 8.00% | ||||
Note payable due date | May 1, 2018 | May 1, 2018 | ||||
Convertible debentures issued | $ 2,000,000 | |||||
Warrant to purchase common shares per share value | $ 0.81 | |||||
Number of warrant issuable | 2,643,460 | |||||
Warrant term | 36 months | |||||
Debt principal amount | $ 742,950 | |||||
Convertible Notes Payable [Member] | ||||||
Common stock conversion price per share | $ 0.75 | |||||
Note interest rate | 8.00% | 8.00% | ||||
Note payable due date | Nov. 6, 2020 | Nov. 6, 2020 | ||||
Debt principal amount | $ 1,206,931 | |||||
Number of common stock shares purchased | 66,666 | |||||
Common stock purchase price value | $ 50,000 | |||||
Common stock purchase price per share | $ 0.75 | |||||
Common stock trading price per share | $ 3.50 | |||||
Unsecured Bridge Note [Member] | ||||||
Accrued interest | $ 1,461 | |||||
Note interest rate | 8.00% | |||||
Note payable due date | Sep. 30, 2016 | |||||
Proceeds from other notes payable | $ 32,000 | |||||
Related Party Notes Payable [Member] | ||||||
Proceeds from issuance of related party debt | $ 210,000 | |||||
Repayment of debt | 105,000 | |||||
Debt interest and fees paid | $ 3,089 |
Short and Long-term Debt - Sche
Short and Long-term Debt - Schedule of Long-term Debt (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Total long-term debt | $ 2,685,370 | $ 3,396,320 |
Less: current portion | 32,000 | 189,389 |
Long-term debt, net of current portion | 2,653,370 | 3,206,931 |
Convertible Debentures [Member] | ||
Total long-term debt | 1,257,050 | 2,000,000 |
Convertible Notes Payable [Member] | ||
Total long-term debt | 1,206,931 | 1,206,931 |
Note Payable [Member] | ||
Total long-term debt | 189,389 | 189,389 |
Unsecured Note Payable [Member] | ||
Total long-term debt | $ 32,000 |
Short and Long-term Debt - Sc39
Short and Long-term Debt - Schedule of Long-term Debt (Details) (Parenthetical) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Convertible Debentures [Member] | ||
Debt interest percentage | 8.00% | 8.00% |
Debt due date | May 1, 2018 | May 1, 2018 |
Debt conversion of convertible debt | $ 742,950 | $ 742,950 |
Convertible Notes Payable [Member] | ||
Debt interest percentage | 8.00% | 8.00% |
Debt due date | Nov. 6, 2020 | Nov. 6, 2020 |
Note Payable [Member] | ||
Debt interest percentage | 15.00% | 15.00% |
Debt due date | Jun. 30, 2018 | Jun. 30, 2018 |
Unsecured Note Payable [Member] | ||
Debt interest percentage | 10.00% | 10.00% |
Short and Long-term Debt - Sc40
Short and Long-term Debt - Schedule of Maturities of Long-term Debt (Details) | Dec. 31, 2016USD ($) |
Debt Disclosure [Abstract] | |
2,017 | $ 32,000 |
2,018 | 1,446,439 |
2,019 | |
2,020 | 1,206,931 |
2,021 |
Preferred Stock (Details Narrat
Preferred Stock (Details Narrative) - $ / shares | Dec. 31, 2016 | Dec. 31, 2015 |
Equity [Abstract] | ||
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Common Stock (Details Narrative
Common Stock (Details Narrative) - USD ($) | Dec. 28, 2015 | Dec. 18, 2015 | Aug. 31, 2016 | Nov. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Jul. 07, 2016 |
Number of common stock issued | 294,000 | 1,235,278 | |||||||
Shares issued price per share | $ 0.50 | $ 0.75 | $ 0.75 | ||||||
Warrant exercise price | $ 1.50 | ||||||||
Number of units subscribed | 1,106,952 | ||||||||
Proceeds from the offering of units | $ 1,498,731 | ||||||||
Number of common stock issued, value | $ 147,000 | $ 926,460 | $ 147,000 | ||||||
Accrued interest | 1,012 | 29,498 | 1,012 | ||||||
Estimated value of inventory | $ 35,174 | 35,174 | |||||||
Stock based compensation | 279,739 | 343,488 | |||||||
Number of shares issued for services, value | $ 17,265 | $ 15,385 | |||||||
Private Placement [Member] | |||||||||
Shares issued price per share | $ 0.75 | $ 1.50 | $ 0.75 | ||||||
Warrant exercise price | $ 1.50 | ||||||||
Conversion of debt principal amount | $ 1,300,000 | ||||||||
Accrued interest | $ 500,000 | ||||||||
Stock option price per share | $ 1.50 | ||||||||
Sale Agreement And Patent Assignment Agreement [Member] | |||||||||
Shares issued price per share | $ 0.75 | ||||||||
Number of common stock issued, value | $ 112,500 | ||||||||
Estimated value of inventory | 2,200 | ||||||||
Estimated value of molds | 35,000 | ||||||||
Estimated value of patent | 175,300 | ||||||||
Asset consideration | $ 100,000 | ||||||||
Asset consideration, shares | 150,000 | ||||||||
Common Stock [Member] | |||||||||
Number of common stock issued | 294,000 | ||||||||
Shares issued price per share | $ 0.87 | ||||||||
Number of common stock issued, value | $ 294 | ||||||||
Common stock issued for conversion of note and accrued interest, shares | 1,251,504 | 95,283 | |||||||
Debt conversion price per share | $ 0.65 | ||||||||
Number of shares issued for services | 19,767 | 20,513 | |||||||
Number of shares issued for services, value | $ 20 | $ 21 | |||||||
Convertible Debt [Member] | |||||||||
Conversion of debt principal amount | 742,950 | ||||||||
Accrued interest | $ 70,527 | ||||||||
Convertible Notes Payable [Member] | |||||||||
Accrued interest | $ 11,934 | $ 11,934 | |||||||
Debt conversion price per share | $ 0.65 | $ 0.65 | |||||||
Convertible notes payable | $ 50,000 | $ 50,000 | |||||||
Debt converted into shares | 95,283 | ||||||||
Placement Agent [Member] | |||||||||
Number of common stock issued | 103,166 | ||||||||
Commission fee incurred | $ 166,043 | ||||||||
Allowance of reimburse expenses received | 10,000 | ||||||||
Legal fees | $ 6,949 | ||||||||
Debt converted into shares | 742,950 | ||||||||
Escrow Agent [Member] | |||||||||
Due from related party | $ 1,000 | ||||||||
Directors Officers And Consultant [Member] | |||||||||
Shares issued price per share | $ 0.75 | ||||||||
Stock based compensation | $ 15,385 | 126,400 | $ 255,915 | ||||||
Number of shares issued for services | 20,513 | ||||||||
Unrecognized Compensation Cost Related to Restricted Common Stock Grants | $ 436 | ||||||||
Weighted average period | 7 days | ||||||||
Two Consultant [Member] | |||||||||
Shares issued price per share | $ 0.87 | ||||||||
Number of shares issued for services | 19,767 | ||||||||
Number of shares issued for services, value | $ 17,265 | ||||||||
Maximum [Member] | |||||||||
Number of common stock issued | 3,500,000 | ||||||||
Shares issued price per share | $ 1.50 |
Common Stock - Company's Nonves
Common Stock - Company's Nonvested Shares (Details) - Restricted Common Stock [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Restricted Common Stock Beginning Balance | 253,670 | 765,500 |
Restricted Common Stock Grants, Awarded | ||
Restricted Common Stock Grants, Vested | (252,798) | (511,830) |
Restricted Common Stock Ending Balance | 872 | 253,670 |
Weighted Average Common Stock Price Beginning Balance | $ 0.50 | $ 0.50 |
Weighted Average Common Stock Price, Awarded | ||
Weighted Average Common Stock Price, Vested | 0.50 | 0.50 |
Weighted Average Common Stock Price Ending Balance | $ 0.50 | $ 0.50 |
Common Stock - Schedule of Comp
Common Stock - Schedule of Compensation Cost for Share-based Payment Arrangements, Allocation of Share-based Compensation Costs by Plan(Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Total share-based compensation | $ 279,739 | $ 343,488 |
Research and Development Expense [Member] | ||
Total share-based compensation | 166,626 | 165,342 |
Selling, General and Administrative Expenses [Member] | ||
Total share-based compensation | $ 113,114 | $ 178,146 |
Common Stock Warrants (Details
Common Stock Warrants (Details Narrative) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Mar. 31, 2015 | |
Fair value of warrant vested price per share | $ 0.76 | $ 0.402 | |
Share-based compensation and additional paid in capital | $ 136,074 | $ 43,594 | |
Amortization related to vesting of warrants | $ 28,594 | ||
Share issued price per share | $ 0.75 | $ 0.50 | |
Number of warrants issued | 1,106,952 | ||
Risk-free interest rate | 1.02% | ||
Expected volatility | 141.00% | ||
Expected life | 2 years 1 month 13 days | ||
Expected dividend yield | 0.00% | ||
Proceeds from private placement | $ 688,644 | ||
Common stock description | The Company to issue, to the Placement Agent, a warrant to purchase one share of common stock at a price of $0.65 for each $0.81 of the principal amount of the outstanding 8% Convertible Debentures that is converted into Common Stock of the Company. | ||
Intrinsic value | $ 0.85 | ||
Investors [Member] | |||
Share issued price per share | 1.50 | ||
Placement Agent [Member] | |||
Fair value of warrant vested price per share | $ 0.65 | ||
Number of warrants issued | 917,223 | ||
Debt converted into warrants | 742,950 |
Common Stock Warrants - Summary
Common Stock Warrants - Summary of Fair Value of the Warrants Assumptions (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Expected life | 2 years 1 month 13 days | |
Expected volatility | 141.00% | |
Risk-free interest rate | 1.02% | |
Warrants [Member] | ||
Expected life | 4 years 6 months | 5 years 2 months 12 days |
Exercise price | $ 0.50 | $ 0.50 |
Expected volatility | 124.00% | 71.00% |
Expected dividends | ||
Risk-free interest rate | 1.33% | 1.70% |
Common Stock Warrants - Summa47
Common Stock Warrants - Summary of Warrants Outstanding (Details) - Warrants [Member] - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Shared Under Warrants Outstanding Beginning | 1,423,211 | 1,423,211 |
Shared Under Warrants Issued | 2,024,175 | |
Shared Under Warrants Exercised | ||
Shared Under Warrants Expired | ||
Shared Under Warrants Outstanding Ending | 3,447,386 | 1,423,211 |
Weighted Average Exercise Price Outstanding Beginning | $ 0.54 | $ 0.54 |
Weighted Average Exercise Price Issued | 1.26 | |
Weighted Average Exercise Price Exercised | ||
Weighted Average Exercise Price Expired | ||
Weighted Average Exercise Price Outstanding Ending | $ 0.88 | $ 0.54 |
Weighted Average Remaining Contractual Life Outstanding Beginning | 7 years 3 months 19 days | 8 years 3 months 19 days |
Weighted Average Remaining Contractual Life Outstanding Ending | 4 years 2 months 12 days | 7 years 3 months 19 days |
Aggregate Intrinsic Value of Vested Warrants Outstanding Beginning | $ 213,364 | $ 17,640 |
Aggregate Intrinsic Value of Vested Warrants Outstanding Ending | $ 546,333 | $ 213,364 |
Intangible Assets (Details Narr
Intangible Assets (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Number of patents purchased | $ 175,300 | |
Number of common stock shares value | $ 62,800 | |
Number of common stock shares | 150,000 | |
Amortization of patents per month | $ 797 | |
Amortization of patents per year | 9,562 | |
Patents, remaining amortization period | 220 months | |
Amortization expense | $ 9,562 | $ 0 |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Mar. 31, 2015 | Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | |
Number of common stock shares issued | 294,000 | 1,235,278 | ||
Consulting Representation Agreement [Member] | ||||
Number of common stock shares issued | 10,000 | |||
Lease Agreement [Member] | ||||
Percentage of increase in lease rental payment | 3.00% | |||
Monthly rental payments | $ 3,940 | |||
Operating lease expense | 49,469 | $ 48,649 | ||
Accrued royalties | $ 17,873 | 17,873 | $ 17,873 | |
Lease Agreement [Member] | Minimum [Member] | ||||
Development costs | $ 4,750,000 |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Income Tax Disclosure [Abstract] | |
Net operating loss carryforwards | $ 12,200,000 |
Operating loss carryforward expiration | from 2017 through 2036 |
Income Taxes - Schedule of Comp
Income Taxes - Schedule of Components of Net Deferred Tax Assets (Liabilities) (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Income Tax Disclosure [Abstract] | ||
Net operating losses | $ 4,841,700 | $ 3,776,478 |
Research and development credit carryforward | 129,500 | 75,004 |
Related-party accruals | 2,300 | |
Allowance for doubtful accounts | 75,842 | |
Stock based compensation | 57,253 | |
Depreciation and amortization | 15,500 | (4,477) |
Change in valuation allowance | (4,989,000) | (3,980,100) |
Net deferred tax asset |
Income Taxes - Schedule of Effe
Income Taxes - Schedule of Effective Income Tax Rate Reconciliation (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | ||
Net loss | $ (1,082,400) | $ (952,160) |
Non-deductible expenses | 110,300 | (8,824) |
Valuation allowance | 972,100 | 960,984 |
Benefit from Income Taxes |
Other Related Party Transacti53
Other Related Party Transactions (Details Narrative) | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Consulting Agreements [Member] | Directors [Member] | |
Other related party transaction amount | $ 161,000 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Mar. 31, 2015 | Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | |
Number of common stock shares issued | 294,000 | 1,235,278 | ||
Warrant to purchase of common stock | 1,106,952 | |||
Accrued interest payable | $ 1,012 | $ 29,498 | $ 1,012 | |
Repayment of related party debt | 130,000 | $ 25,000 | ||
Convertible Debentures [Member] | ||||
Conversion price per share | $ 0.65 | $ 0.65 | ||
Conversion of debt principal amount | 742,950 | $ 742,950 | ||
Accrued interest payable | $ 70,525 | |||
Subsequent Event [Member] | ||||
Number of shares sold | 2,256,634 | |||
Number of shares sold, value | $ 3,384,952 | |||
Accrued interest payable | 41,607 | |||
Repayment of other note payable | $ 32,000 | |||
Subsequent Event [Member] | Convertible Debentures [Member] | ||||
Number of common stock shares issued | 1,752,274 | |||
Conversion of debt principal amount | $ 991,550 | |||
Repayment of debt | 265,500 | |||
Accrued interest payable | $ 147,428 | |||
Subsequent Event [Member] | Related Party Notes Payable [Member] | ||||
Number of common stock shares issued | 40,000 | |||
Warrant to purchase of common stock | 40,000 | |||
Conversion price per share | $ 1.50 | |||
Conversion of debt principal amount | $ 60,000 | |||
Repayment of related party debt | $ 52,300 | |||
Subsequent Event [Member] | Executive Officer [Member] | ||||
Number of common stock shares issued | 66,667 | |||
Warrant to purchase of common stock | 66,667 | |||
Conversion price per share | $ 1.50 | |||
Conversion of debt principal amount | $ 100,000 | |||
Repayment of debt | 89,389 | |||
Accrued interest payable | $ 39,071 |