Annual report pursuant to Section 13 and 15(d)

EQUITY TRANSACTIONS

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EQUITY TRANSACTIONS
 12 Months Ended
Dec. 31, 2016
Equity [Abstract]  
EQUITY TRANSACTIONS

NOTE 13 - EQUITY TRANSACTIONS

 

Common Stock – Authorized common stock of the Company consists of 70,000,000 shares of $.001 par value, of which 54,525,079 shares were issued and outstanding at December 31, 2016.

 

Preferred Stock – Authorized preferred stock consists of 5,000,000 shares of preferred stock, $.001 par value, no shares of preferred stock are issued and outstanding.

 

2016 Common Stock Transactions

 

In 2016, we issued 600,000 shares of common stock for $300,000 of proceeds.

 

In 2016, we issued 250,000 shares of common stock upon exercise of common stock warrants, receiving proceeds of $125,000.

 

In 2016, we received $29,900 in proceeds for the extension of common stock warrants.

 

In 2016, we issued 100,000 shares of common stock in consideration of a $25,000 common stock subscription payment.

 

2015 Common Stock Transactions

 

In 2015, we issued 13,100 shares of common stock upon the cashless exercise of 55,500 common stock options.

 

In 2015, we issued 120,900 shares of common stock upon the cashless exercise of 200,000 common stock warrants.

 

In January 2015, we issued 514,800 shares of common stock upon the conversion of a note payable and accrued interest totaling $257,400.

 

Warrants

 

In connection with the 2016 issuance of a $200,000 secured short term note payable that we issued a warrant was issued to purchase 500,000 shares of our common stock at $0.50 per share, exercisable over four years. The warrant was valued at $97,181 using a Black Scholes valuation and was charged to interest over the sixty days term of the note. The assumptions used in the valuation of the warrant were; common stock price $0.62, expected life 2 year, volatility 37.89% and discount rate 1.25%. The note was paid in full in 2016.

 

In connection with the issuance of convertible debt in 2016 noted above, the Company issued warrants to acquire 71,000 shares of common stock as an inducement to enter into the transaction. The warrants exercisable for five years at $0.85 per share were valued at $4,900 using the Black Scholes valuation method. The assumptions used in the valuation of the warrants were; common stock price $0.60, expected life 2.5 years, volatility 36.71% and discount rate 1.14%.

 

In connection with the issuance of convertible debt in 2015 noted above, the Company issued warrants to acquire 250,000 shares of common stock as an inducement to enter into the transaction. The warrants exercisable for three years at $1.25 per share were valued at $18,300 using the Black Scholes valuation method. In December 2016, the convertible debt agreements were amended and the warrants exercise price was modified to $0.85 per share.

 

In 2015, 200,000 warrants were issued in connection with a consulting agreement, warrants to acquire 100,000 shares of common stock vested immediately in 2015 and the additional warrants to acquire an additional 100,000 shares of common stock will vest in 2016 upon extension of the consulting agreement. The warrants are exercisable at $.77 per share and are exercisable for a period of five years.

 

A summary of warrant activity for the years ended December 31, 2016 and December 31, 2015 is presented as follows:

 

      Number of     Exercise  
      Warrants     Price  
Warrants Outstanding at January 1, 2015       9,614,430       $.40 to $1.25  
   Issued       450,000       $.77 to $1.25  
   Exercised       (200,000 )     $.40  
   Forfeited/expired/canceled       (25,000 )     $.50  
Warrants Outstanding at January 1, 2016       9,839,430       $.50 to $1.25  
   Issued       571,000       $.50 to $.85  
   Exercised       (250,000 )     $.50  
   Forfeited/expired/canceled       (495,000 )     $.70  
                   
Warrants Outstanding at December 31, 2016       9,665,430       $.50 to $1.25