Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Mar. 31, 2021 | May 11, 2021 | |
Document Information Line Items | ||
Entity Registrant Name | APPLIED ENERGETICS, INC. | |
Document Type | 10-Q | |
Current Fiscal Year End Date | --12-31 | |
Entity Common Stock, Shares Outstanding | 199,840,573 | |
Amendment Flag | false | |
Entity Central Index Key | 0000879911 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Document Period End Date | Mar. 31, 2021 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity File Number | 001-14015 | |
Entity Incorporation, State or Country Code | DE | |
Entity Interactive Data Current | Yes |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Current assets | ||
Cash and cash equivalents | $ 4,394,000 | $ 3,323,290 |
Other receivable | 19,884 | 2,880 |
Other assets | 144,652 | 39,352 |
Total current assets | 4,558,536 | 3,365,522 |
Long-term assets | ||
Property and equipment - net | 149,904 | 19,466 |
Deferred compensation | 1,041,666 | 1,250,001 |
Total assets | 5,750,106 | 4,634,989 |
Current liabilities | ||
Accounts payable | 193,144 | 152,445 |
Notes payable | 1,104,184 | 1,547,695 |
Notes payable CARES Act PPP Loan | 121,807 | |
Due to related parties | 50,000 | 50,000 |
Accrued expenses | 82,701 | 938 |
Accrued dividends | 48,079 | 48,079 |
Total current liabilities | 1,599,915 | 1,799,157 |
Long-term liabilities | ||
Long-term notes payable | 1,000,000 | 1,000,000 |
Long-term notes payable CARES Act PPP Loan | 12,181 | 133,462 |
Total liabilities | 2,612,096 | 2,932,619 |
Commitments and Contingencies (Note 9) | ||
Stockholders’ Equity | ||
Series A convertible preferred stock, $.001 par value, 2,000,000 shares authorized and 13,602 shares issued and outstanding at March 31, 2021 and December 31, 2020 (Liquidation preference $340,050 and 340,050, respectively) | 14 | 14 |
Common stock, $.001 par value, 500,000,000 shares authorized; 199,380,831 and 190,529,320 shares issued and outstanding at March 31, 2021 and at December 31, 2020, respectively | 199,381 | 190,529 |
Additional paid-in capital | 96,291,817 | 93,778,591 |
Accumulated deficit | (93,353,202) | (92,266,764) |
Total stockholders’ equity | 3,138,010 | 1,702,370 |
Total Liabilities and Stockholders’ Equity | $ 5,750,106 | $ 4,634,989 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parentheticals) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Series A convertible preferred stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 |
Series A convertible preferred stock, authorized | 2,000,000 | 2,000,000 |
Series A convertible preferred stock, issued | 13,602 | 13,602 |
Series A convertible preferred stock, outstanding | 13,602 | 13,602 |
Series A convertible preferred stock, liquidation preference (in Dollars) | $ 340,050 | $ 340,050 |
Common stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 199,380,831 | 190,529,320 |
Common stock, shares outstanding | 199,380,831 | 190,529,320 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Income Statement [Abstract] | ||
Revenue | $ 10,000 | |
Cost of revenue | ||
Gross profit | 10,000 | |
Operating expenses | ||
General and administrative | $ 943,619 | 1,090,418 |
Selling and marketing | 94,328 | 81,686 |
Research and development | 47,808 | 57,480 |
Total operating expenses | 1,085,755 | 1,229,584 |
Operating loss | (1,085,755) | (1,219,584) |
Other income/(expense) | ||
Other income | 15,832 | |
Interest expense | (683) | (61,339) |
Total other income/(expense) | (683) | (45,507) |
Loss before provision for income taxes | (1,086,438) | (1,265,091) |
Provision for income taxes | ||
Net loss | (1,086,438) | (1,265,091) |
Preferred stock dividends | (8,501) | (8,501) |
Net loss attributable to common stockholders | $ (1,094,939) | $ (1,273,592) |
Net loss attributable to common stockholders per common share - basic and diluted (in Dollars per share) | $ (0.01) | $ (0.01) |
Weighted average number of common shares outstanding (in Shares) | 195,372,061 | 208,973,729 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Changes In Stockholders’ (Deficit) Equity (Unaudited) - USD ($) | Preferred Stock | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Total |
Balance at Dec. 31, 2019 | $ 14 | $ 206,569 | $ 85,907,523 | $ (89,036,271) | $ (2,922,165) |
Balance (in Shares) at Dec. 31, 2019 | 13,602 | 206,569,062 | |||
Stock-based compensation | 439,956 | 439,956 | |||
Common stock issued on exercise of warrant | $ 25 | 1,725 | 1,750 | ||
Common stock issued on exercise of warrant (in Shares) | 25,000 | ||||
Sale of common stock | $ 3,710 | 1,109,290 | 1,113,000 | ||
Sale of common stock (in Shares) | 3,710,000 | ||||
Net loss | (1,265,091) | (1,265,091) | |||
Balance at Mar. 31, 2020 | $ 14 | $ 210,304 | 87,458,494 | (90,301,362) | (2,632,550) |
Balance (in Shares) at Mar. 31, 2020 | 13,602 | 210,304,062 | |||
Balance at Dec. 31, 2020 | $ 14 | $ 190,529 | 93,778,591 | (92,266,764) | 1,702,370 |
Balance (in Shares) at Dec. 31, 2020 | 13,602 | 190,529,320 | |||
RSU restricted Stock | $ 31 | 4,519 | 4,550 | ||
RSU restricted Stock (in Shares) | 31,250 | ||||
Stock-based compensation | 170,029 | 170,029 | |||
Common stock issued on exercise options and warrant | $ 1,606 | 40,394 | 42,000 | ||
Common stock issued on exercise options and warrant (in Shares) | 1,605,682 | ||||
Common stock issued on exercise of convertible note | $ 158 | 47,340 | 47,499 | ||
Common stock issued on exercise of convertible note (in Shares) | 158,329 | ||||
Sale of common stock | $ 7,056 | 2,250,944 | 2,258,000 | ||
Sale of common stock (in Shares) | 7,056,250 | ||||
Net loss | (1,086,438) | (1,086,438) | |||
Balance at Mar. 31, 2021 | $ 14 | $ 199,381 | $ 96,291,817 | $ (93,353,202) | $ 3,138,010 |
Balance (in Shares) at Mar. 31, 2021 | 13,602 | 199,380,831 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Cash Flows From Operating Activities | ||
Net loss | $ (1,086,438) | $ (1,265,091) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Noncash stock based compensation expense | 174,579 | 439,956 |
Depreciation and amortization | 4,276 | 4,276 |
Amortization of future compensation payable | 208,335 | 208,333 |
Amortization of prepaid assets | 43,124 | 39,303 |
Changes in assets and liabilities: | ||
Accounts receivable | 9,888 | |
Other receivable | (17,004) | |
Other assets | (31,413) | (86,420) |
Accounts payable | (23,358) | (177,989) |
Accrued interest | 526 | 60,848 |
Accrued expenses | 81,763 | (20,567) |
Net cash used in operating activities | (645,610) | (787,463) |
Cash Flows From Investing Activities | ||
Purchase of equipment | (70,657) | |
Net cash used in investing activities | (70,657) | |
Cash Flows From Financing Activities | ||
Proceeds from sale of common stock | 2,258,000 | 1,113,000 |
Repayment on note payable | (513,023) | (119,569) |
Proceeds from the exercise of stock options and warrants | 42,000 | 1,750 |
Net cash provided by financing activities | 1,786,977 | 995,181 |
Net change in cash and cash equivalents | 1,070,710 | 207,718 |
Cash and cash equivalents, beginning of year | 3,323,290 | 88,415 |
Cash and cash equivalents, end of year | 4,394,000 | 296,133 |
Supplemental disclosure of cash flow information | ||
Cash paid for interest | 355 | 5,243 |
Cash paid for taxes | ||
Non-cash investing and financing activities | ||
Insurance financing for prepaid insurance | 117,209 | |
Equipment investing in accounts payable | 64,107 | |
Common stock issued for repayment of convertible notes | $ 47,499 |
Organization of Business, Going
Organization of Business, Going Concern and Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
ORGANIZATION OF BUSINESS, GOING CONCERN AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1 – ORGANIZATION OF BUSINESS, GOING CONCERN AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The condensed consolidated financial statements include the accounts of Applied Energetics, Inc. and its wholly owned subsidiary North Star Power Engineering, Inc. (“North Star”) (collectively, “company,” “Applied Energetics,” “AERG”, “we,” “our” or “us”). All intercompany balances and transactions have been eliminated. The accompanying interim unaudited condensed consolidated financial statements include the accounts of Applied Energetics, Inc. and its wholly owned subsidiary North Star Power Engineering, Inc. (“North Star”) (collectively, “Company,” “Applied Energetics,” “we,” “our” or “us”). The unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information, the instructions for Form 10-Q and the rules and regulations of the SEC. Accordingly, since they are interim statements, the accompanying unaudited condensed consolidated financial statements do not include all of the information and notes required by GAAP for annual financial statements, but reflect all adjustments consisting of normal, recurring adjustments, that are necessary for a fair presentation of the financial position, results of operations and cash flows for the interim periods presented. Interim results are not necessarily indicative of the results that may be expected for any future periods. The December 31, 2020 balance sheet information was derived from the audited financial statements as of that date. Going Concern The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. For the period ended March 31, 2021, the company incurred a net loss of approximately $1,086,000, had negative cash flows from operations of approximately $646,000 and may incur additional future losses due to the reduction in government contract activity. At March 31, 2021, the Company had total current assets of approximately $4,559,000 and total current liabilities of approximately $1,600,000 resulting in working capital of approximately $2,959,000. At March 31, 2021, the Company had cash of approximately $4,394,000. During the three months ended March 31, 2021, the Company completed the issuance of 7,056,250 total shares of its common stock at a price of $0.32 per share, or $2,258,000 in the aggregate. Based on the Company’s current business plan, it believes its cash balance as of the date of this filing will be sufficient to meet its anticipated cash requirements for the next twelve months. However, there can be no assurance that the current business plan will be achievable. Such conditions raise substantial doubts about the Company’s ability to continue as a going concern for one year from the date the financial statements are issued. The company’s existence is dependent upon management’s ability to develop profitable operations. Management is devoting substantially all of its efforts to developing its business and raising capital and there can be no assurance that the company’s efforts will be successful. No assurance can be given that management’s actions will result in profitable operations or the resolution of its liquidity problems. The accompanying consolidated financial statements do not include any adjustments that might result should the company be unable to continue as a going concern. The ongoing COVID-19 pandemic contributes to this uncertainty. In order to improve the company’s liquidity, the company’s management is actively pursuing additional equity financing through discussions with investment bankers and private investors. There can be no assurance that the company will be successful in its effort to secure additional equity financing. The financial statements do not include any adjustments relating to the recoverability of assets and the amount or classification of liabilities that might be necessary should the company be unable to continue as a going concern. Applied Energetics, Inc. is a corporation organized and existing under the laws of the State of Delaware. Our executive office is located at 9070 S. Rita Road Suite 1500, Tucson, Arizona, 85747, we have office and laboratory space at 4595 S Palo Verde Rd, Suite 517, Tucson, AZ 85714 as well as office space at 2480 W Ruthrauff Road, Ste 140Q, Tucson, AZ 85705 and our telephone number is (520) 628-7415. Use of Estimates The preparation of unaudited condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates, judgments and assumptions that affect the amounts reported in the financial statements and accompanying notes. Management bases its assumptions on historical experiences and on various other assumptions that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. In addition, management considers the basis and methodology used in developing and selecting these estimates, the trends in and amounts of these estimates, specific matters affecting the amount of and changes in these estimates, and any other relevant matters related to these estimates, including significant issues concerning accounting principles and financial statement presentation. Such estimates and assumptions could change in the future as more information becomes known which could impact the amounts reported and disclosed herein. Significant estimates include revenue recognition, carrying amounts of long-lived assets, valuation assumptions for share-based payments, evaluation of debt modification accounting, effective borrowing rate determinations, analysis of fair value transferred upon debt extinguishment, valuation and calculation of measurements of income tax assets and liabilities and valuation of debt discount related to beneficial conversion features. Net Loss Attributable to Common Stockholders Basic loss per common share is computed by dividing net loss attributable to common stockholders by the weighted average number of common shares outstanding for the period before giving effect to stock options, stock warrants, restricted stock units and convertible securities outstanding, which are considered to be dilutive common stock equivalents. Diluted net loss per common share is calculated based on the weighted average number of common and potentially dilutive shares outstanding during the period after giving effect to dilutive common stock equivalents. Contingently issuable shares are included in the computation of basic loss per share when issuance of the shares is no longer contingent. The number of warrants, options, restricted stock units and our Series A Convertible Preferred Stock, which were not included in the computation of earnings per share because the effect was antidilutive, was 32,909,390 and 35,097,466 for the years ended March 31, 2021 and 2020, respectively. Significant Concentrations and Risks We maintain cash balances at a commercial bank and, at times, balances exceed FDIC limits. As of March 31, 2021 approximately $4,144,000 was uninsured. |
New Accounting Standards
New Accounting Standards | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
NEW ACCOUNTING STANDARDS | NOTE 2 – NEW ACCOUNTING STANDARDS The company has reviewed all issued accounting pronouncements and plans to adopt those that are applicable to it. The company does not expect the adoption of any other pronouncements to have an impact on its results of operations or financial position. In December 2019, the FASB issued amended guidance in the form of ASU No. 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes.” This ASU is intended to simplify various aspects related to accounting for income taxes by removing certain exceptions to the general principles in Topic 740 and clarifying certain aspects of the current guidance to promote consistency among reporting entities. ASU 2019-12 is effective for annual periods beginning after December 15, 2020 and interim periods within those annual periods, with early adoption permitted. An entity that elects early adoption must adopt all the amendments in the same period. Most amendments within this ASU are required to be applied on a prospective basis, while certain amendments must be applied on a retrospective or modified retrospective basis. The Company is in the initial stage of evaluating the impact of this new standard however it does not believe the guidance will have a material impact on our financial statements. On August 5, 2020, the FASB issued ASU No. 2020-06 which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts on an entity’s own equity. ASU 2020-06 simplifies the guidance in U.S. GAAP on the issuer’s accounting for convertible debt instruments. Such guidance includes multiple disparate sets of classification, measurement, and derecognition requirements whose interactions are complex. ASU 2020-06 is effective for annual periods beginning after December 15, 2021 and interim periods within those annual periods, with early adoption permitted. An entity that elects early adoption must adopt all the amendments in the same period. Most amendments within this ASU are required to be applied on a prospective basis, while certain amendments must be applied on a retrospective or modified retrospective basis. The Company is in the initial stage of evaluating the impact of this new standard however it does not believe the guidance will have a material impact on our financial statements. |
Notes Payable
Notes Payable | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
NOTES PAYABLE | NOTE 3 – NOTES PAYABLE On May 24, 2019, the Company entered into an Asset Purchase Agreement (the “APA”) with Applied Optical Sciences, LLC (“AOS”) to acquire certain assets. As consideration for the APA, the Company entered into a promissory note issued to the shareholders of AOS for $2,500,000. The note is non-interest bearing and shall be repaid in equal installments, the first payment is due on February 10, 2021 and subsequent payments being due May, 24, 2021 and the remainder on the last day of each six-month period thereafter, the final such payment being due on November 24, 2022. The Promissory Note may be prepaid at any time (in whole or in part). Upon inception, the Company recorded a debt discount in the amount of $2,500,000 in relation to the transaction which is being amortized over the life of the loan as compensation expense. During the three months ended March 31, 2021, the Company made a payment in the amount of $500,000 for this promissory note. As of March 31, 2021 and December 31, 2020, the note is not in default. On April 28, 2020, the Company entered into a loan agreement with Alliance Bank of Arizona, N.A. for a loan in the amount of $133,658 pursuant to the Paycheck Protection Program (the “PPP”) under the Coronavirus Aid, Relief, and Economic Security Act enacted on March 27, 2020 (the “CARES Act”). This loan is evidenced by a promissory note dated April 27, 2020 and matures two years from the disbursement date. This loan bears interest at a rate of 1.00% per annum, with the first nine months of interest deferred. Principal and interest are payable monthly commencing nine months after the disbursement date and may be prepaid by the Company at any time prior to maturity with no prepayment penalties. This loan contains customary events of default relating to, among other things, payment defaults or breaches of the terms of the loan. Upon the occurrence of an event of default, the lender may require immediate repayment of all amounts outstanding under the note. During the three months ending December 31, 2020, the Company converted $47,499 of notes payable into 158,329 shares of common stock. The following reconciles notes payable as of March 31, 2021 and December 31, 2020: March 31, December 31, Beginning balance $ 2,681,157 $ 4,697,890 Notes payable 117,209 4,456,760 Accrued interest 328 297,849 Transfer from prepaid - 108,064 Initial beneficial conversion feature - (919,000 ) Amortize beneficial conversion feature - 919,000 Payments on notes payable (513,023 ) (1,480,951 ) Repayment of interest - (152,603 ) Converted into common stock (47,499 ) (5,515,852 ) Total 2,238,172 2,681,157 Less-Notes payable - current (1,225,991 ) (1,547,695 ) Notes payable - non-current $ 1,012,181 $ 1,133,462 Future principal payments for the Company’s Notes as of March 31, 2021 are as follows: 2021 $ 1,225,991 2022 1,012,181 Thereafter - Total $ 2,238,172 Of the $2,238,172 note payable balance, $1,225,991 are short term of which $1,000,000 are payments on the note to acquire Applied Optical Sciences and $1,012,181 are long term, of which $1,000,000 are payments on the note to acquire Applied Optical Sciences. Of the note to acquire Applied Optical Sciences, the first payment was due on February 10, 2021 and subsequent payments being due May, 24, 2021 and the remainder on the last day of each six-month period thereafter, the final such payment being due on November 24, 2022. |
Deferred Compensation
Deferred Compensation | 3 Months Ended |
Mar. 31, 2021 | |
Compensation Related Costs [Abstract] | |
DEFERRED COMPENSATION | NOTE 4 – DEFERRED COMPENSATION On May 24, 2019, the company entered into the APA with AOS to acquire certain assets. As consideration for the APA, the company entered into a promissory note issued to the shareholders of AOS for $2,500,000. The company also recorded a debt discount, which is reported on the balance sheet as deferred compensation, in the amount of $2,500,000 in relation to the transaction which is being amortized over the life of the loan as compensation expense. The amortization of deferred compensation for the three months ended March 31, 2021 and 2020 was $208,335 and $208,333, respectively. |
Due to Related Parties
Due to Related Parties | 3 Months Ended |
Mar. 31, 2021 | |
Related Party Transactions [Abstract] | |
DUE TO RELATED PARTIES | NOTE 5 – DUE TO RELATED PARTIES It has come to the board’s attention that on July 31, 2018, our now deceased CEO deposited $50,000 into the company’s account. Although it has been suggested that the funds may have been intended for use toward Mr. Dearmin’s healthcare, the board does not know for certain what the purpose of the funds were or the nature of any intended investment. Accordingly, the board is investigating the appropriate disposition of the funds which will likely be to the estate of Mr. Dearmin. Until such a determination is made, the board does not intend to use these funds for any corporate purpose. For reporting purposes, the company has treated the deposit as a due to related party. |
Stockholders_ Deficit
Stockholders’ Deficit | 3 Months Ended |
Mar. 31, 2021 | |
Stockholders' Equity Note [Abstract] | |
STOCKHOLDERS’ DEFICIT | NOTE 6 – STOCKHOLDERS’ DEFICIT Authorized Capital Stock The Company’s authorized capital stock consists of 500,000,000 shares of common stock at a par value of $.001 per share and 2,000,000 shares of preferred stock at a par value of $.001 per share. In January 2020, the company received $603,000 from five non-affiliated individuals based on subscription agreements with the company for which the company issued 2,010,000 shares of its common stock. In January 2020, the company issued 25,000 shares upon exercise of a warrant by a non-affiliated warrant holder at an exercise price of $0.07 per share. In February 2020, the company received $510,000 from a non-affiliated individual based on a subscription agreement with the company for which the company issued 1,700,000 shares of its common stock. During the three months ended March 31, 2021, the Company issued 7,056,250 shares of common stock in a private placement to accredited investors for $0.32 per share or $2,258,000 of net cash proceeds, in the aggregate. During the three months ended March 31, 2021, the Company issued 158,329 shares of common stock upon the conversion of $47,499 of convertible notes (see Note 3). During the three months ended March 31, 2021, the Company issued 31,250 shares of common stock in relation to a restricted stock agreement with a value of $4,550. During the three months ended March 31, 2021, the Company issued 600,000 shares of common stock upon the exercise of 600,000 warrants at an exercise price of $0.07 a share. During the three months ended March 31, 2021, the company issued 1,005,682 shares of common stock upon the exercise of 1,090,910 options at an exercise price of $0.05 a share. This exercise was performed on a cashless basis. During the three months ended March 31, 2021, the Company recognized stock based compensation in the amount of $170,029. Preferred Stock As of March 31, 2021 and December 31, 2020 there were 13,602 shares of Series A Redeemable Convertible Preferred Stock (the “Series A Preferred Stock”) issued and outstanding, respectively. The company has not paid the dividends commencing with the quarterly dividend due August 1, 2013. Dividend arrearages as of March 31, 2021 including previously accrued dividends included in our balance sheet are approximately $264,000. Our Board of Directors suspended the declaration of the dividend, commencing with the dividend payable as of February 1, 2015 since we did not have a surplus (as such term is defined in the Delaware general corporation Law) as of December 31, 2014, until such time as we have a surplus or net profits for a fiscal year. Our Series A Preferred Stock has a liquidation preference of $25.00 per Share. The Series A Preferred Stock bears dividends at the rate of 6.5% of the liquidation preference per share per annum, which accrues from the date of issuance, and is payable quarterly. Dividends may be paid in: (i) cash, (ii) shares of our common stock (valued for such purpose at 95% of the weighted average of the last sales prices of our common stock for each of the trading days in the ten trading day period ending on the third trading day prior to the applicable dividend payment date), provided that the issuance and/or resale of all such shares of our common stock are then covered by an effective registration statement and the company’s common stock is listed on a U.S. national securities exchange or the Nasdaq Stock Market at the time of issuance or (iii) any combination of the foregoing. If the company fails to make a dividend payment within five business days following a dividend payment date, the dividend rate shall immediately and automatically increase by 1% from 6.5% of the liquidation preference per offered share of Series A preferred stock to 7.5% of such liquidation preference. If a payment default shall occur on two consecutive dividend payment dates, the dividend rate shall immediately and automatically increase to 10% of the liquidation preference for as long as such payment default continues and shall immediately and automatically return to the Initial dividend rate at such time as the payment default is no longer continuing. Each share of Series A Preferred Stock is convertible at any time at the option of the holder into a number of shares of common stock equal to the liquidation preference (plus any unpaid dividends for periods prior to the dividend payment date immediately preceding the date of conversion by the holder) divided by the conversion price (initially $12.00 per share, subject to adjustment in the event of a stock dividend or split, reorganization, recapitalization or similar event.) If the closing sale price of the common stock is greater than 140% of the conversion price on 20 out of 30 trading days, the company may redeem the Series A Preferred Stock in whole or in part at any time through October 31, 2010, upon at least 30 days’ notice, at a redemption price, payable in cash, equal to 100% of the liquidation preference of the shares to be redeemed, plus unpaid dividends thereon to, but excluding, the redemption date, subject to certain conditions. In addition, beginning November 1, 2010, the company may redeem the Series A Preferred Stock in whole or in part, upon at least 30 days’ notice, at a redemption price, payable in cash, equal to 100% of the liquidation preference of the Series A Preferred Stock to be redeemed, plus unpaid dividends thereon to, but excluding, the redemption date, under certain conditions. If a change of control occurs, each holder of shares of Series A Convertible Preferred Stock that are outstanding immediately prior to the change of control shall have the right to require the corporation to purchase, out of legally available funds, any outstanding shares of Series A Convertible Preferred Stock at the defined purchase price. The purchase price is defined as: per share of Preferred Stock, 101% of the liquidation preference thereof, plus all unpaid and accumulated dividends, if any, to the date of purchase thereof. The purchase price is payable, at the corporation’s option, (x) in cash, (y) in shares of the common stock at a discount of 5% from the fair market value of Common Stock on the Purchase Date (i.e. valued at a 95% discount of the Common Stock on the Purchase Date), or (z) any combination thereof. If the Corporation pays all or a portion of the Purchase Price in Common Stock, no fractional shares of Common Stock will be issued; instead, the company will round the applicable number of shares of Common Stock up to the nearest whole number of shares; provided that the Corporation may pay the Purchase Price (or a portion thereof), whether in cash or in shares of Common Stock, only if the Corporation has funds legally available for such payment and may pay the Purchase Price (or a portion thereof) in shares of its Common Stock only if (i) the Common Stock is listed on a U.S. national securities exchange or the Nasdaq Stock Market at the time of issuance and (ii) a shelf registration statement covering the issuance by the Corporation and/or resales of the Common Stock issuable as payment of the Purchase Price is effective on the Payment Date unless such shares are eligible for immediate resale in the public market by non-affiliates of the Corporation. Dividends on our Preferred Stock are payable quarterly on the first day of February, May, August and November, in cash or shares of Common Stock, at our discretion. Share-Based Payments Effective November 12, 2018, the Board of Directors of Applied Energetics, Inc. adopted the 2018 Incentive Stock Plan. The plan provides for the allocation and issuance of stock, restricted stock purchase offers and options (both incentive stock options and non-qualified stock options) to officers, directors, employees and consultants of the company. The board reserved a total of 50,000,000 shares for possible issuance under the plan. We have, from time to time, also granted non-plan options to certain officers, directors, employees and consultants. Total stock-based compensation expense for grants to officers, employees and consultants was approximately $174,579 and $440,000 for three months ended March 31, 2021 and 2020, respectively, which was charged to general and administrative expense. There was no related income tax benefit recognized because our deferred tax assets are fully offset by a valuation allowance. We determine the fair value of option grant share-based awards at their grant date, using a Black-Scholes- Merton Option-Pricing Model. At March 31, 2021, options to purchase 29,909,090 shares of common stock were outstanding with a weighted average exercise price of $0.1374 with a weighted average remaining contract term of approximately 5.4 years with an aggregate intrinsic value (amount by which Applied Energetics’ closing stock price on the last trading day of the year exceeds the exercise price of the option) of approximately $19,959,000. As of March 31, 2021, there was approximately $541,000 of unrecognized compensation cost related to unvested stock options granted and outstanding, net of estimated forfeitures. The cost is expected to be recognized on a weighted average basis over a period of approximately one year. There was no activity of our restricted stock units and restricted stock grants for three months ended March 31, 2021 and 2020. The following table summarizes the activity of our stock options for the three months ended March 31, 2021: Shares Weighted Outstanding at December 31, 2020 32,000,000 $ 0.1419 Granted - $ - Exercised (1,090,910 ) $ 0.0500 Forfeited or expired (1,000,000 ) $ 0.3700 Outstanding at March 31, 2021 29,909,090 $ 0.1374 Exercisable at March 31, 2021 24,621,590 $ 0.1043 As of March 31, 2021 and December 31, 2020 there was no unrecognized stock-based compensation related to unvested restricted stock agreements, net of estimated forfeitures. As of March 31, 2021 and December 31, 2020 there was $724,750 and $892,000, respectively, in unrecognized stock-based compensation related to a lockup agreement on 5,000,000 shares of common stock in the acquisition of AOS valued at $0.4014 a share as that was the closing price on the date of the contract and is amortized over 36 months. $167,250 and $167,250 was amortized for the three months ended March 31, 2021 and 2020, respectively. Warrant Activity Shares Weighted Weighted Outstanding at December 31, 2020 3,550,000 $ 0.0627 6.17 Warrants exercised (600,000 ) $ 0.0692 Outstanding and exercisable at March 31, 2021 2,950,000 $ 0.0614 7.08 Warrants Outstanding Warrants Exercisable Weighted Avg. Remaining Shares Contractual Weighted Avg. Shares Weighted Avg. Range of Exercise Prices Outstanding Life in Years Exercise Price Exercisable Exercise Price $0.05 - $0.08 2,950,000 7.08 $ 0.0614 2,950,000 $ 0.0614 2,950,000 7.08 $ 0.0614 2,950,000 $ 0.0614 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 7 – COMMITMENTS AND CONTINGENCIES Operating Leases In May 2016, the Company moved and entered into a month-to-month lease agreement to lease office space in Tucson, Arizona. In May 2019, the Company acquired Applied Optical Sciences and assumed the month-to-month lease for office and laboratory space also in Tucson, Arizona. Rent expense was approximately $13,000 for the three months ended March 31, 2021 and 2020, respectively. In March 2021, the Company signed a five-year lease for a 13,000 square foot laboratory/office space in Tucson. The lease term commences May 1, 2021 and ends on April 30, 2026. The base rent is $6.7626 per rentable square foot for year one, and escalates to $9.2009 in year two, $11.4806 in year three, $13.1740 in year four and $14.9306 in year five, plus certain operating expenses and taxes. At March 31, 2021, we had approximately $4,000 in future minimum lease payments due in less than a year. Guarantees We agree to indemnify our officers and directors for certain events or occurrences arising as a result of the officers or directors serving in such capacity. The maximum amount of future payments that we could be required to make under these indemnification agreements is unlimited. However, we maintain a director’s and officer’s liability insurance policy that limits our exposure and enables us to recover a portion of any future amounts paid. As a result, we believe the estimated fair value of these indemnification agreements is minimal because of our insurance coverage and we have not recognized any liabilities for these agreements as of March 31, 2021 and 2020. Litigation On July 3, 2019, Gusrae, Kaplan & Nusbaum and its partner, Ryan Whalen filed a claim in the District Court for the Southern District of New York against the company, its directors, officers, attorneys and a consultant. The action alleges libel, securities fraud and related claims. The company believes that this suit lacks merit and intends to dispute these allegations. The company filed a motion to dismiss the complaint on October 24, 2019. On December 13, 2019, Gusrae Kaplan and Mr. Whalen filed an opposition to the Company’s motion. On January 10, 2020, the company filed a reply brief. The United States District Court has not yet ruled on the motion. On January 15, 2021, the company filed a complaint in the United States District Court, Southern District of New York, against Gusrae, Kaplan & Nusbaum and Ryan Whalen for malpractice and breach of New York Rules of Professional Conduct by both parties as former counsel to the company. Gusrae, Kaplan & Nusbaum and Ryan Whalen have not yet responded to the complaint. As previously reported, on June 15, 2020, Grace A.C. Dearmin, as the Administrator of the Estate of Thomas Carr Dearmin, filed a cross-complaint against the company and company directors Jonathan Barcklow and Bradford Adamczyk, alleging causes of action against them for breach of contract and conversion. On February 8, 2021, the court granted the company’s motion to dismiss on personal jurisdiction grounds as to the company, Mr. Barcklow and Mr. Adamczyk. As with any litigation, the company cannot predict the outcome with certainty, but the company expects to provide further updates on the status of the litigation as circumstances warrant. We may, from time to time, be involved in legal proceedings arising from the normal course of business. |
Subsequent Event
Subsequent Event | 3 Months Ended |
Mar. 31, 2021 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENT | NOTE 8 – SUBSEQUENT EVENT Subsequent to March 31, 2021, the Company issued 259,741 shares of common stock upon the exercise of 500,000 options at an exercise price of $0.37 a share. This exercise was performed on a cashless basis. Subsequent to March 31, 2021, the Company issued 200,000 shares of common stock upon the exercise of 200,000 warrants at an exercise price of $0.07 per share. On April 21, 2021, the company amended its Master Services Agreement, dated as of July 16, 2018, with Westpark Advisors, LLC, pursuant to a First Amendment to Master Services Agreement. The amendment grants Westpark Advisors options to purchase an additional 1,000,000 shares of common stock at an exercise price of $0.40 per share, in exchange for Westpark Advisors continued service to the company. The options vest over a period of three years from the date of the amendment. Effective May 12, 2021, the company and Mr. Donaghey renewed his consulting agreement, extending his service on the Board of Advisors for an additional term of two sequential one-year periods. As compensation for the renewal, Mr. Donaghey is to receive for each year of service during the renewal term 70,000 shares of AERG common stock and options to purchase 200,000 shares of common stock at an exercise price of $0.61 per share, reflecting the fair market value of the common stock on the date of grant. 50% of the options vest on the first anniversary of the renewal, and the other 50% vest on the second anniversary. 50% of the common stock vests immediately and the remaining 50% on the first anniversary of the agreement. The company’s management has evaluated subsequent events occurring after March 31, 2021, the date of our most recent balance sheet, through the date our financial statements were issued. |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The condensed consolidated financial statements include the accounts of Applied Energetics, Inc. and its wholly owned subsidiary North Star Power Engineering, Inc. (“North Star”) (collectively, “company,” “Applied Energetics,” “AERG”, “we,” “our” or “us”). All intercompany balances and transactions have been eliminated. The accompanying interim unaudited condensed consolidated financial statements include the accounts of Applied Energetics, Inc. and its wholly owned subsidiary North Star Power Engineering, Inc. (“North Star”) (collectively, “Company,” “Applied Energetics,” “we,” “our” or “us”). The unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information, the instructions for Form 10-Q and the rules and regulations of the SEC. Accordingly, since they are interim statements, the accompanying unaudited condensed consolidated financial statements do not include all of the information and notes required by GAAP for annual financial statements, but reflect all adjustments consisting of normal, recurring adjustments, that are necessary for a fair presentation of the financial position, results of operations and cash flows for the interim periods presented. Interim results are not necessarily indicative of the results that may be expected for any future periods. The December 31, 2020 balance sheet information was derived from the audited financial statements as of that date. |
Going Concern | Going Concern The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. For the period ended March 31, 2021, the company incurred a net loss of approximately $1,086,000, had negative cash flows from operations of approximately $646,000 and may incur additional future losses due to the reduction in government contract activity. At March 31, 2021, the Company had total current assets of approximately $4,559,000 and total current liabilities of approximately $1,600,000 resulting in working capital of approximately $2,959,000. At March 31, 2021, the Company had cash of approximately $4,394,000. During the three months ended March 31, 2021, the Company completed the issuance of 7,056,250 total shares of its common stock at a price of $0.32 per share, or $2,258,000 in the aggregate. Based on the Company’s current business plan, it believes its cash balance as of the date of this filing will be sufficient to meet its anticipated cash requirements for the next twelve months. However, there can be no assurance that the current business plan will be achievable. Such conditions raise substantial doubts about the Company’s ability to continue as a going concern for one year from the date the financial statements are issued. The company’s existence is dependent upon management’s ability to develop profitable operations. Management is devoting substantially all of its efforts to developing its business and raising capital and there can be no assurance that the company’s efforts will be successful. No assurance can be given that management’s actions will result in profitable operations or the resolution of its liquidity problems. The accompanying consolidated financial statements do not include any adjustments that might result should the company be unable to continue as a going concern. The ongoing COVID-19 pandemic contributes to this uncertainty. In order to improve the company’s liquidity, the company’s management is actively pursuing additional equity financing through discussions with investment bankers and private investors. There can be no assurance that the company will be successful in its effort to secure additional equity financing. The financial statements do not include any adjustments relating to the recoverability of assets and the amount or classification of liabilities that might be necessary should the company be unable to continue as a going concern. Applied Energetics, Inc. is a corporation organized and existing under the laws of the State of Delaware. Our executive office is located at 9070 S. Rita Road Suite 1500, Tucson, Arizona, 85747, we have office and laboratory space at 4595 S Palo Verde Rd, Suite 517, Tucson, AZ 85714 as well as office space at 2480 W Ruthrauff Road, Ste 140Q, Tucson, AZ 85705 and our telephone number is (520) 628-7415. |
Use of Estimates | Use of Estimates The preparation of unaudited condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates, judgments and assumptions that affect the amounts reported in the financial statements and accompanying notes. Management bases its assumptions on historical experiences and on various other assumptions that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. In addition, management considers the basis and methodology used in developing and selecting these estimates, the trends in and amounts of these estimates, specific matters affecting the amount of and changes in these estimates, and any other relevant matters related to these estimates, including significant issues concerning accounting principles and financial statement presentation. Such estimates and assumptions could change in the future as more information becomes known which could impact the amounts reported and disclosed herein. Significant estimates include revenue recognition, carrying amounts of long-lived assets, valuation assumptions for share-based payments, evaluation of debt modification accounting, effective borrowing rate determinations, analysis of fair value transferred upon debt extinguishment, valuation and calculation of measurements of income tax assets and liabilities and valuation of debt discount related to beneficial conversion features. |
Net Loss Attributable to Common Stockholders | Net Loss Attributable to Common Stockholders Basic loss per common share is computed by dividing net loss attributable to common stockholders by the weighted average number of common shares outstanding for the period before giving effect to stock options, stock warrants, restricted stock units and convertible securities outstanding, which are considered to be dilutive common stock equivalents. Diluted net loss per common share is calculated based on the weighted average number of common and potentially dilutive shares outstanding during the period after giving effect to dilutive common stock equivalents. Contingently issuable shares are included in the computation of basic loss per share when issuance of the shares is no longer contingent. The number of warrants, options, restricted stock units and our Series A Convertible Preferred Stock, which were not included in the computation of earnings per share because the effect was antidilutive, was 32,909,390 and 35,097,466 for the years ended March 31, 2021 and 2020, respectively. |
Significant Concentrations and Risks | Significant Concentrations and Risks We maintain cash balances at a commercial bank and, at times, balances exceed FDIC limits. As of March 31, 2021 approximately $4,144,000 was uninsured. |
Notes Payable (Tables)
Notes Payable (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of reconciles notes payable | March 31, December 31, Beginning balance $ 2,681,157 $ 4,697,890 Notes payable 117,209 4,456,760 Accrued interest 328 297,849 Transfer from prepaid - 108,064 Initial beneficial conversion feature - (919,000 ) Amortize beneficial conversion feature - 919,000 Payments on notes payable (513,023 ) (1,480,951 ) Repayment of interest - (152,603 ) Converted into common stock (47,499 ) (5,515,852 ) Total 2,238,172 2,681,157 Less-Notes payable - current (1,225,991 ) (1,547,695 ) Notes payable - non-current $ 1,012,181 $ 1,133,462 |
Schedule of future principal payments | 2021 $ 1,225,991 2022 1,012,181 Thereafter - Total $ 2,238,172 |
Stockholders_ Deficit (Tables)
Stockholders’ Deficit (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Stockholders' Equity Note [Abstract] | |
Schedule of activity of our stock options | Shares Weighted Outstanding at December 31, 2020 32,000,000 $ 0.1419 Granted - $ - Exercised (1,090,910 ) $ 0.0500 Forfeited or expired (1,000,000 ) $ 0.3700 Outstanding at March 31, 2021 29,909,090 $ 0.1374 Exercisable at March 31, 2021 24,621,590 $ 0.1043 |
Schedule of unrecognized stock-based compensation related to unvested restricted stock, net of estimated forfeitures | Warrant Activity Shares Weighted Weighted Outstanding at December 31, 2020 3,550,000 $ 0.0627 6.17 Warrants exercised (600,000 ) $ 0.0692 Outstanding and exercisable at March 31, 2021 2,950,000 $ 0.0614 7.08 |
Schedule of range exercise prices warrants outstanding and exercisable | Warrants Outstanding Warrants Exercisable Weighted Avg. Remaining Shares Contractual Weighted Avg. Shares Weighted Avg. Range of Exercise Prices Outstanding Life in Years Exercise Price Exercisable Exercise Price $0.05 - $0.08 2,950,000 7.08 $ 0.0614 2,950,000 $ 0.0614 2,950,000 7.08 $ 0.0614 2,950,000 $ 0.0614 |
Organization of Business, Goi_2
Organization of Business, Going Concern and Summary of Significant Accounting Policies (Details) - USD ($) | 1 Months Ended | 3 Months Ended | ||
Jan. 31, 2020 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Organization of Business, Going Concern and Summary of Significant Accounting Policies (Details) [Line Items] | ||||
Net loss | $ 1,086,000 | |||
Negative cash flows from operations | 646,000 | |||
Total current assets | 4,559,000 | |||
Current liabilities | 1,599,915 | $ 1,799,157 | ||
Cash | $ 4,394,000 | $ 3,323,290 | ||
Shares issues (in Shares) | 2,010,000 | |||
Shares issued price per share (in Dollars per share) | $ 0.32 | |||
Aggregate shares amount | $ 2,258,000 | $ 1,113,000 | ||
Antidilutive options, restricted stock units, and Series A Convertible Preferred Stock shares excluded from of earnings per share (in Shares) | 32,909,390 | 35,097,466 | ||
Cash uninsured | $ 4,144,000 | |||
Government contract [Member] | ||||
Organization of Business, Going Concern and Summary of Significant Accounting Policies (Details) [Line Items] | ||||
Working capital | 1,600,000 | |||
Current liabilities | 2,959,000 | |||
Cash | $ 4,394,000 | |||
Common Stock [Member] | ||||
Organization of Business, Going Concern and Summary of Significant Accounting Policies (Details) [Line Items] | ||||
Shares issues (in Shares) | 7,056,250 | 3,710,000 | ||
Aggregate shares amount | $ 7,056 | $ 3,710 |
Notes Payable (Details)
Notes Payable (Details) - USD ($) | May 24, 2019 | Apr. 28, 2020 | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 |
Notes Payable (Details) [Line Items] | |||||
Issued of stock value | $ 1,750 | ||||
Debt discount | $ 2,500,000 | ||||
Promissory note | $ 500,000 | ||||
Payment, description | the Company entered into a loan agreement with Alliance Bank of Arizona, N.A. for a loan in the amount of $133,658 pursuant to the Paycheck Protection Program (the “PPP”) under the Coronavirus Aid, Relief, and Economic Security Act enacted on March 27, 2020 (the “CARES Act”). This loan is evidenced by a promissory note dated April 27, 2020 and matures two years from the disbursement date. This loan bears interest at a rate of 1.00% per annum, with the first nine months of interest deferred. Principal and interest are payable monthly commencing nine months after the disbursement date and may be prepaid by the Company at any time prior to maturity with no prepayment penalties. | ||||
Convertible notes payable | $ 47,499 | ||||
Common stock issued on exercise of stock option and warrant, Shares (in Shares) | 500,000 | 158,329 | |||
Note payable balance | $ 2,238,172 | ||||
Short term amount | 1,225,991 | ||||
Debt payment | 1,000,000 | ||||
Long term amount | 1,012,181 | ||||
Long term prepayments | $ 1,000,000 | ||||
AOS [Member] | |||||
Notes Payable (Details) [Line Items] | |||||
Issued of stock value | $ 2,500,000 |
Notes Payable (Details) - Sched
Notes Payable (Details) - Schedule of reconciles notes payable - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Schedule of reconciles notes payable [Abstract] | ||
Beginning balance | $ 2,681,157 | $ 4,697,890 |
Notes payable | 117,209 | 4,456,760 |
Accrued interest | 328 | 297,849 |
Transfer from prepaid | 108,064 | |
Initial beneficial conversion feature | (919,000) | |
Amortize beneficial conversion feature | 919,000 | |
Payments on notes payable | (513,023) | (1,480,951) |
Repayment of interest | (152,603) | |
Converted into common stock | (47,499) | (5,515,852) |
Total | 2,238,172 | 2,681,157 |
Less-Notes payable - current | (1,225,991) | (1,547,695) |
Notes payable - non-current | $ 1,012,181 | $ 1,133,462 |
Notes Payable (Details) - Sch_2
Notes Payable (Details) - Schedule of future principal payments | Mar. 31, 2021USD ($) |
Schedule of future principal payments [Abstract] | |
2021 | $ 1,225,991 |
2022 | 1,012,181 |
Thereafter | |
Total | $ 2,238,172 |
Deferred Compensation (Details)
Deferred Compensation (Details) - USD ($) | 1 Months Ended | 3 Months Ended | ||
May 24, 2019 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Compensation Related Costs [Abstract] | ||||
Promissory note issued | $ 2,500,000 | |||
Deferred compensation | $ 2,500,000 | $ 1,041,666 | $ 1,250,001 | |
Amortization of deferred compensation | $ 208,335 | $ 208,333 |
Due to Related Parties (Details
Due to Related Parties (Details) | 1 Months Ended |
Jul. 31, 2018USD ($) | |
CEO [Member] | |
Due to Related Parties (Details) [Line Items] | |
Deposited | $ 50,000 |
Stockholders_ Deficit (Details)
Stockholders’ Deficit (Details) | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Feb. 29, 2020USD ($)shares | Jan. 31, 2020USD ($)$ / sharesshares | Mar. 31, 2021USD ($)$ / sharesshares | Mar. 31, 2020USD ($) | Dec. 31, 2020USD ($)$ / sharesshares | Dec. 31, 2019USD ($) | |
Stockholders’ Deficit (Details) [Line Items] | ||||||
Common stock, shares authorized (in Shares) | shares | 500,000,000 | 500,000,000 | ||||
preferred stock, shares authorized (in Shares) | shares | 2,000,000 | 2,000,000 | ||||
Common stock value | $ 2,258,000 | $ 1,113,000 | ||||
Common stock shares (in Shares) | shares | 2,010,000 | |||||
Exercise price per share (in Dollars per Share) | $ / shares | 0.07 | |||||
Price per share (in Dollars per share) | $ / shares | $ 0.32 | |||||
Shares issued for convertible notes | $ 47,499 | |||||
Stock issued for restricted stock agreement (in Shares) | shares | 31,250 | |||||
Stock value issued for restricted stock agreement | $ 4,550 | |||||
Warrant exercise price per share (in Dollars per share) | $ / shares | $ 0.0614 | $ 0.0627 | ||||
Shares of exercise of options (in Shares) | shares | 1,005,682 | |||||
Stock value exercise of options | $ 1,090,910 | |||||
Options exercise price per share (in Dollars per share) | $ / shares | $ 0.32 | |||||
Stock based compensation expense | $ 170,029 | |||||
Reversal of convertible preferred stock dividend accrual | $ 13,602 | $ 264,000 | ||||
Series A convertible preferred stock, liquidation preference (in Dollars per share) | $ / shares | $ 25 | |||||
Series A convertible preferred stock, dividend rate | 6.50% | |||||
Weighted average of the last sales prices | 95.00% | |||||
liquidation preference | 7.50% | |||||
Dividend rate increase | 10.00% | |||||
Preferred stock conversion price per share (in Dollars per share) | $ / shares | $ 12 | |||||
Stockholders equity, description | If the closing sale price of the common stock is greater than 140% of the conversion price on 20 out of 30 trading days, the company may redeem the Series A Preferred Stock in whole or in part at any time through October 31, 2010, upon at least 30 days’ notice, at a redemption price, payable in cash, equal to 100% of the liquidation preference of the shares to be redeemed, plus unpaid dividends thereon to, but excluding, the redemption date, subject to certain conditions. In addition, beginning November 1, 2010, the company may redeem the Series A Preferred Stock in whole or in part, upon at least 30 days’ notice, at a redemption price, payable in cash, equal to 100% of the liquidation preference of the Series A Preferred Stock to be redeemed, plus unpaid dividends thereon to, but excluding, the redemption date, under certain conditions. | |||||
Common stock discount shares description | The purchase price is payable, at the corporation’s option, (x) in cash, (y) in shares of the common stock at a discount of 5% from the fair market value of Common Stock on the Purchase Date (i.e. valued at a 95% discount of the Common Stock on the Purchase Date), or (z) any combination thereof. | |||||
Reserved a total possible issuance under the plan (in Shares) | shares | 50,000,000 | |||||
Total stock-based compensation expense for grants | $ 174,579 | $ 440,000 | ||||
Issuable in acquisition, description | As of March 31, 2021 and December 31, 2020 there was $724,750 and $892,000, respectively, in unrecognized stock-based compensation related to a lockup agreement on 5,000,000 shares of common stock in the acquisition of AOS valued at $0.4014 a share as that was the closing price on the date of the contract and is amortized over 36 months. $167,250 and $167,250 was amortized for the three months ended March 31, 2021 and 2020, respectively | |||||
unrecognized stock based compensation | $ 892,000 | $ 724,750 | ||||
Minimum [Member] | ||||||
Stockholders’ Deficit (Details) [Line Items] | ||||||
Amount of dividend rate increase if distribution not made within five business days following dividend payment date | 1.00% | |||||
Maximum [Member] | ||||||
Stockholders’ Deficit (Details) [Line Items] | ||||||
Amount of dividend rate increase if distribution not made within five business days following dividend payment date | 6.50% | |||||
Stock option [Member] | ||||||
Stockholders’ Deficit (Details) [Line Items] | ||||||
Options exercise price per share (in Dollars per share) | $ / shares | $ 0.05 | |||||
Share-based compensation, options granted (in Shares) | shares | 29,909,090 | |||||
Share-based compensation, options outstanding, weighted average exercise price (in Dollars per share) | $ / shares | $ 0.1374 | |||||
Share-based compensation, options outstanding, weighted average remaining contractual term | 5 years 146 days | |||||
Options outstanding aggregate intrinsic value | $ 19,959,000 | |||||
Unrecognized compensation costs related to unvested equity awards, net of estimated forfeitures | 541,000 | |||||
Private Placement [Member] | ||||||
Stockholders’ Deficit (Details) [Line Items] | ||||||
Common stock value | $ 2,258,000 | |||||
Common Stock [Member] | ||||||
Stockholders’ Deficit (Details) [Line Items] | ||||||
Common stock value | $ 510,000 | $ 603,000 | ||||
Common stock shares (in Shares) | shares | 1,700,000 | 7,056,250 | ||||
Issue of warrants (in Shares) | shares | 25,000 | |||||
Stock issued for convertible notes (in Shares) | shares | 158,329 | |||||
Shares issued for convertible notes | $ 47,499 | |||||
Warrant [Member] | ||||||
Stockholders’ Deficit (Details) [Line Items] | ||||||
Stock value issued for exercise of warrants (in Shares) | shares | 600,000 | |||||
Warrant exercise price per share (in Dollars per share) | $ / shares | $ 0.07 | |||||
Preferred Stock [Member] | ||||||
Stockholders’ Deficit (Details) [Line Items] | ||||||
liquidation preference | 101.00% |
Stockholders_ Deficit (Detail_2
Stockholders’ Deficit (Details) - Schedule of activity of our stock options - Stock Option [Member] | 3 Months Ended |
Mar. 31, 2021$ / sharesshares | |
Stockholders’ Deficit (Details) - Schedule of activity of our stock options [Line Items] | |
Shares Outstanding, Beginning balance | shares | 32,000,000 |
Weighted Average Exercise Price Outstanding, Beginning balance | $ / shares | $ 0.1419 |
Shares Outstanding, Ending balance | shares | 29,909,090 |
Weighted Average Exercise Price Outstanding, Ending balance | $ / shares | $ 0.1374 |
Shares, Exercisable | shares | 24,621,590 |
Weighted Average Exercise Price, Exercisable | $ / shares | $ 0.1043 |
Granted | shares | |
Weighted Average Exercise Price, Granted | $ / shares | |
Shares, Exercised | shares | (1,090,910) |
Weighted Average Exercise Price, Exercised | $ / shares | $ 0.0500 |
Shares, Forfeited or expired | shares | (1,000,000) |
Weighted Average Exercise Price, Forfeited or expired | $ / shares | $ 0.3700 |
Stockholders_ Deficit (Detail_3
Stockholders’ Deficit (Details) - Schedule of unrecognized stock-based compensation related to unvested restricted stock, net of estimated forfeitures | 3 Months Ended |
Mar. 31, 2021$ / sharesshares | |
Schedule of unrecognized stock-based compensation related to unvested restricted stock, net of estimated forfeitures [Abstract] | |
Beginning Balance | 3,550,000 |
Beginning Balance (in Dollars per share) | $ / shares | $ 0.0627 |
Weighted Average Remaining Contractual Term (years) | 6.17 |
Ending Balance | 2,950,000 |
Ending Balance (in Dollars per share) | $ / shares | $ 0.0614 |
Weighted Average Remaining Contractual Term (years) | 7 years 29 days |
Warrants exercised, Shares | (600,000) |
Warrants exercised, Weighted Average Exercise Price (in Dollars per share) | $ / shares | $ 0.0692 |
Stockholders_ Deficit (Detail_4
Stockholders’ Deficit (Details) - Schedule of range exercise prices warrants outstanding and exercisable | 3 Months Ended |
Mar. 31, 2021$ / sharesshares | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Warrants Outstanding, Shares Outstanding | shares | 7.08 |
Warrants Outstanding, Weighted Avg. Remaining Contractual Life in Years | 22 days |
Warrants Outstanding, Weighted Avg. Exercise Price | $ / shares | $ 2,950,000 |
Warrants Exercisable, Shares Exercisable | shares | 0.0614 |
Minimum [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of Exercise Prices | $ / shares | $ 2,950,000 |
$0.05 - $0.08 [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Warrants Outstanding, Shares Outstanding | shares | 7.08 |
Warrants Outstanding, Weighted Avg. Remaining Contractual Life in Years | 22 days |
Warrants Outstanding, Weighted Avg. Exercise Price | $ / shares | $ 2,950,000 |
Warrants Exercisable, Shares Exercisable | shares | 0.0614 |
$0.05 - $0.08 [Member] | Minimum [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of Exercise Prices | $ / shares | $ 2,950,000 |
Commitments and Contingencies (
Commitments and Contingencies (Details) | 3 Months Ended | |
Mar. 31, 2021USD ($) | Mar. 31, 2020USD ($) | |
Commitments and Contingencies (Details) [Line Items] | ||
Rent expense | $ 13,000 | $ 13,000 |
Lease term | 5 years | |
Future minimum lease payments due in less than a year | $ 4,000 | |
Square Food Laboratory [Member] | ||
Commitments and Contingencies (Details) [Line Items] | ||
Lease square foot | 13,000 | |
Per rentable square foot for year one | $ 6.7626 | |
Per rentable square foot for year two | 9.2009 | |
Per rentable square foot for year three | 11.4806 | |
Per rentable square foot for year four | 13.1740 | |
Per rentable square foot for year five | $ 14.9306 |
Subsequent Event (Details)
Subsequent Event (Details) - $ / shares | May 12, 2021 | Apr. 21, 2021 | Mar. 31, 2021 | Dec. 31, 2020 |
Subsequent Event (Details) [Line Items] | ||||
Common stock issued during exercise of options | 259,741 | |||
Common stock upon the exercise | 500,000 | 158,329 | ||
Exercise price (in Dollars per share) | $ 0.37 | |||
Warrant [Member] | ||||
Subsequent Event (Details) [Line Items] | ||||
Common stock upon the exercise | 200,000 | |||
Common stock issued during exercise of warrants | 200,000 | |||
Exercise price of warrants (in Dollars per share) | $ 0.07 | |||
Subsequent Event [Member] | ||||
Subsequent Event (Details) [Line Items] | ||||
Additional shares of common stock issued | 1,000,000 | |||
Price per share (in Dollars per share) | $ 0.40 | |||
Subsequent events, description | the company and Mr. Donaghey renewed his consulting agreement, extending his service on the Board of Advisors for an additional term of two sequential one-year periods. As compensation for the renewal, Mr. Donaghey is to receive for each year of service during the renewal term 70,000 shares of AERG common stock and options to purchase 200,000 shares of common stock at an exercise price of $0.61 per share, reflecting the fair market value of the common stock on the date of grant. 50% of the options vest on the first anniversary of the renewal, and the other 50% vest on the second anniversary. 50% of the common stock vests immediately and the remaining 50% on the first anniversary of the agreement. |