Secured 10% Bridge Notes (Secured 10% Bridge Notes [Member])

9 Months Ended

Sep. 30, 2014

Secured 10% Bridge Notes [Member]

Debt Instrument [Line Items]

Debt

Note 8 – Secured 10% Bridge Notes

During 2013, we issued Secured 10% Bridge Notes (“Bridge Notes”) with an aggregate principal value of $750,000. The Bridge Notes were secured by substantially all of our assets. As of September 30, 2014 and December 31, 2013 the Bridge Notes outstanding was $ 0 and $300,000, respectively .

Each of the Bridge Notes provided for warrants to purchase common stock in a future public company. Bridge Notes totaling $450,000 in principal value were granted warrants at a ratio of 1 warrant share for each $5.00 in principal amount. Bridge Notes totaling $300,000 in principal value were granted warrants at a ratio of 1 warrant share for each $2.00 in principal amount. The exercise price of the warrants is $0.32 per share and the warrants are exercisable for five years from the note issuance date. Warrants with respect to 240,000 underlying shares were issued as a result of the issuance of these notes. The warrants were valued using the Black- Scholes model and were valued at approximately $21,000, an amount that was recorded as a debt discount on the date of issuance. The discount was accreted to interest expense over the term of the notes and was fully accreted by December 31, 2013. In connection with these secured bridge notes, we issued additional warrants to purchase 481,428 shares of our common stock to a placement agent at an exercise price of $0.32 per share and exercisable for a period of five years. The warrants were valued using the Black- Scholes model and were valued at $81,843, an amount that was recorded as financial advisory fees in the three months ended March 31, 2014.

The due date for $450,000 (principal value) of the Bridge Notes was originally November 30, 2013 and was subsequently extended to December 31, 2013. The due date for $300,000 (principal value) of the Bridge Notes was originally December 31, 2013, but was subsequently extended to December 31, 2014.

On December 31, 2013, in anticipation of the Merger, Bridge Notes totaling $450,000 (the same notes that were due December 31, 2013) were cancelled and included in the private placement for four investors at a per share conversion price of $0.28. The remaining $300,000 (principal value) of Bridge Notes retain the right to convert at the same conversion price ($0.28) at anytime prior to December 31, 2014.

On July 3, 2014, we repaid $150,000 of principal value of the outstanding $300,000 of Bridge Notes.

On August 27, 2014, Bridge Notes totaling $150,000 were cancelled and included in the private placement for one investor at a per share conversion price of $0.28. In September 2014, all accrued and payable interest on the Bridge Notes outstanding was paid.