Quarterly report pursuant to Section 13 or 15(d)

Common Stock

Common Stock
3 Months Ended
Mar. 31, 2014
Common Stock [Abstract]  
Common Stock

9.Common Stock

The following transactions occurred from January 1, 2014 to March 31, 2014:

a)On January 21, 2014 the Company closed on a registered direct public offering to issue and sell 19,047,620 shares of common stock and warrants to purchase up to 4,761,905 shares of common stock.  The common stock and warrants were sold in units, consisting of common stock and a warrant to purchase 0.25 shares of common stock, at a price of $1.05 per share, and the warrants have an exercise price of $1.28 per share.  The total gross proceeds of the offering were $20,000,001.  The warrants issued are exercisable beginning six months and one day after the closing date until the five-year anniversary of the closing date and were recorded as liabilities at fair value. 

The total closing costs of the offering were $1,365,754, which consisted of placement agent and other professional fees.  Based upon the estimated fair value of the stock and warrants in the units, the Company allocated $206,172 to financing expense and $1,159,582 as stock issuance costs.

A summary of the allocation of the proceeds of the offering is shown below:











Gross Proceeds:








Allocated to liabilities:




   Warrant liabilities












Allocated to equity:




   Common stock and additional paid-in capital








Total allocated gross proceeds:





b )On February 10, 2014, the Company issued 300,000 shares of stock to two vendors in exchange for investor relations and financial advisory services.  The market value of the stock issued was $1.12, and the total market value of the issuance was $336,000.

c)During the three months ended March 31, 2014, warrant holders exercised warrants to purchase shares of the Company’s common stock for cash of $5,228,518, and the Company issued 10,488,220 shares.

d) During the three months ended March 31, 2014, an option holder exercised stock options to purchase shares of the Company’s common stock for cash of $70,000, and the Company issued 87,500 shares.