Annual report pursuant to Section 13 and 15(d)

Stockholders' Equity (Tables)

v3.7.0.1
Stockholders' Equity (Tables)
 12 Months Ended
Dec. 31, 2016
Equity [Abstract]  
Dividends Preferred Stock

Dividend charges recorded during the years ended December 31, 2016, the three months ended December 31, 2015 and the year ended September 30, 2015 are as follows:

 

    For The Years/Three Months Ended  
    Year Ended December 31,
2016 		    Transitional Three Months Ended December 31,
2015 		    Year Ended September 30,
2015 		 
Series                        
A   $ 50,038     $ 12,510     $ 50,038  
A-1     29,523       7,381       29,523  
B     -       -       -  
C-1     -       -       -  
C-2     -       -       -  
C-3     -       -       -  
Total   $ 79,561     $ 19,891     $ 79,561  

Schedule of Accrued Liabilities

Accrued dividends payable at December 31, 2016, December 31, 2015, and September 30, 2015 are comprised of the following:

 

    As Of  
    December 31,
2016 		    December 31,
2015 		    September 30,
2015 		 
Series                  
A   $ 304,129       259,646     $ 247,136  
A-1     226,565       191,487       184,107  
B     -       -       -  
C-1     -       -       -  
C-2     -       -       -  
C-3     -       -       -  
Total   $ 530,694     $ 451,133     $ 431,243  

Schedule of Warrants and Derivative Warrant Liability

As of December 31, 2016, the following warrants are outstanding:

 

Issued to   Amount     Issue Date   Expiration Date   Exercise Price  
Term Note Lender(1)     2,343,750     9/30/2016   9/30/2021     0.80  
Investment Bank     1,969,837     12/9/2012   12/9/2019     0.20  
Investment Bank     2,434,539     10/31/2014   10/31/2021     0.20  
Equity Investors     2,487,000     9/8/2016   9/8/2021     0.80  
Equity Investors     2,423,688     9/29/2016   9/29/2021     0.80  
Equity Investors     2,589,312     10/12/2016   10/12/2021     0.80  
Term Note Lender (1)     2,500,000     11/11/2016   11/11/2021     0.40  
      16,748,126                  

 

(1) Warrants were determined to be a derivative subject to fair value accounting and are booked as a warrant liability.
Schedule of Warrants Activity

A summary of the warrant activity from the year ended September 30, 2015, the transitional three months ended December 31, 2015, and the year ended December 31, 2016 is presented below:

 

                  Weighted        
            Weighted     Average        
            Average     Remaining     Aggregate  
      Number of     Exercise     Life     Intrinsic  
      Warrants     Price     In Years     Value  
Outstanding, September 30, 2014       2,918,254     $ 0.89       1.2       -  
Issued       -       -       -       -  
Exercised       -       -       -       -  
Expired       (2,173,255 )     1.00       -       -  
Outstanding, September 20, 2015       744,999       .58       0.3       -  
Issued       -       -       -       -  
Exercised       -       -       -       -  
Expired       (307,664 )     .40       -       -  
Outstanding, December 31, 2015       437,335     $ 0.58       0.2       -  
Issued       16,748,126       0.64       -       -  
Exercised       -       -       -       -  
Expired       (437,335 )     .40       -       -  
Outstanding, December 31, 2016       16,748,126     $ 0.55       4.6     $ -  
                                   
Exercisable, December 31, 2016       16,748,126     $ 0.55       4.6     $ -  

Schedule of Common Stock Warrants

The following table presents information related to common stock warrants at December 31, 2016:

 

Warrants Outstanding     Warrants Exercisable
            Weighted      
            Average   Exercisable  
Exercise     Number of     Remaining Life   Number of  
Price     Warrants     In Years   Warrants  
                         
$ 0.20       4,404,376     4.0     4,404,376  
  0.40       6,250,000     4.9     6,250,000  
  0.80       6,093,750     4.7     6,093,750  
          16,748,126           16,748,126  

Schedule of Fair Value Assumptions of Warrant Derivative Liability

The following table summarizes the calculated aggregate fair values for the warrant derivative liability using the Lattice Model method based on the following assumptions:

 

    September Warrant     November Warrant     September Warrant December 31, 2016 Revaluation     November Warrant December 31, 2016 Revaluation  
Risk free rate     1.14 %     1.5 %     1.91 %     1.92 %
Volatility     37.80 %     37.40       37.53 %     37.40 %
Dividends     0       0       0       0  
Time to maturity      5.0 years         5.0 years       4.75 years       4.87 years  
Fair value per share price     .06111       .1544       .0724       .1697  
Fair value of warrants   $ 143,200     $ 386,000       169,700       424,300  

Schedule of Change in the Fair Value of Warrants

The following table summarizes the change in fair value of the warrants from inception through December 31, 2016.

 

    Fair value                 Fair value  
    as of     New     Derivative     as of  
    9/30/2016     Issuances     gain (loss)     12/31/2016  
Investor warrants (9/30/16)   $ (143,200 )     -     $ (26,500 )   $ (169,700 )
Investor warrants (11/11/16)           $ (386,000 )   $ (38,300 )   $ (424,300 )
Totals   $ (143,200 )   $ (386,000 )   $ (64,800 )   $ (594,000 )