Delaware |
20-3369218 |
(State or other jurisdiction of |
(I.R.S. Employer |
incorporation or organization) |
Identification No.) |
Large Accelerated Filer ☐
|
|
Accelerated Filer ☐
|
Non-accelerated Filer ☐ (Do not check if a smaller reporting company) |
|
Smaller Reporting Company ☒ |
|
|
Page |
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PART I |
|
Item 1. |
Business |
|
Item 1A |
Risk Factors |
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Item 1B |
Unresolved Staff Comments |
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Item 2. |
Properties |
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Item 3. |
Legal Proceedings |
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Item 4. |
Mine Safety Disclosures |
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PART II |
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Item 5. |
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchase of Equity Securities |
|
Item 6 |
Selected Financial Data |
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Item 7. |
Management's Discussion and Analysis of Financial Condition and Results of Operation |
|
Item 7A |
Quantitative and Qualitative Disclosures About Market Risk |
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Item 8. |
Financial Statements and Supplementary Data |
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Item 9. |
Changes In and Disagreements with Accountants on Accounting and Financial Disclosure |
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Item 9A. |
Controls and Procedures |
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Item 9B. |
Other Information |
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PART III |
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Item 10. |
Directors, Executive Officers, Promoters and Corporate Governance |
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Item 11. |
Executive Compensation |
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Item 12. |
Security Ownership of Certain Beneficial Owners and Management |
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|
and Related Stockholder Matters |
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Item 13. |
Certain Relationships and Related Transactions, and Director Independence |
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Item 14. |
Principal Accountant Fees and Services |
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PART IV |
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Item 15. |
Exhibits, Financial Statement Schedules |
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|
| |
SIGNATURES |
|
Period |
High |
Low |
January 1, 2014-March 31, 2014 |
$3.06 |
$1.76 |
April 1, 2014-June 30, 2014 |
$2.80 |
$1.80 |
July 1, 2014-September 30, 2014 |
$3.12 |
$2.06 |
October 1, 2014-December 31, 2014 |
$2.37 |
$1.46 |
January 1, 2015-March 31, 2015 |
$2.10 |
$1.46 |
April 1, 2015-June 30, 2015 |
$1.91 |
$1.32 |
July 1, 2015-September 30, 2015 |
$1.70 |
$1.06 |
October 1, 2015-December 31, 2015 |
$1.50 |
$0.61 |
Name of Purchaser |
Issue Date |
Security |
Shares |
Consideration |
STEVE GIRGENTI |
1/1/2015 |
Common |
2,717 |
Board Fees |
ALVARO PASCUAL-LEONE M.D. |
2/1/2015 |
Common |
919 |
Consulting Fees |
FOUNTAINHEAD CAPITAL MANAGEMENT LIMITED |
2/5/2015 |
Series D. Pref. |
5,745 |
Series D Dividend |
PETER C. ZACHARIOU |
2/5/2015 |
Series D. Pref. |
2,119 |
Series D Dividend |
CRAIG KIRSCH |
2/5/2015 |
Series D. Pref. |
380 |
Series D Dividend |
JOSEF ZIHL |
2/1/2015 |
Common |
1,838 |
Consulting Fees |
ACORN MANAGEMENT PTS |
3/6/2015 |
Common |
13,889 |
Consulting Fees |
STEVE GIRGENTI |
4/1/2015 |
Common |
2,660 |
Board Fees |
OSCAR BRONSTHER |
3/31/2015 |
Common |
2,660 |
Board Fees |
LOWELL RUSH |
3/31/2015 |
Common |
2,660 |
Board Fees |
JASON BARTON |
3/31/2015 |
Common |
831 |
Consulting Fees |
JOSE ROMANO |
3/31/2015 |
Common |
831 |
Consulting Fees |
FOUNTAINHEAD CAPITAL MANAGEMENT LIMITED |
3/31/2015 |
Common |
8,152 |
Consulting Fees |
ALVARO PASCUAL-LEONE M.D. |
4/30/2015 |
Common |
925 |
Consulting Fees |
JOSEF ZIHL |
4/30/2015 |
Common |
1,849 |
Consulting Fees |
ACORN MANAGEMENT PTS |
4/15/2015 |
Common |
4,630 |
Consulting Fees |
JASON BARTON |
3/31/2015 |
Common |
1,070 |
Consulting Fees |
JOSE ROMANO |
6/30/2015 |
Common |
1,070 |
Consulting Fees |
OSCAR BRONSTHER |
6/30/2015 |
Common |
3,425 |
Board Fees |
LOWELL RUSH |
6/30/2015 |
Common |
3,425 |
Board Fees |
FOUNTAINHEAD CAPITAL MANAGEMENT LIMITED |
6/30/2015 |
Common |
8,333 |
Consulting Fees |
STEVE GIRGENTI |
7/1/2015 |
Common |
3,425 |
Board Fees |
ALVARO PASCUAL-LEONE M.D. |
7/31/2015 |
Common |
1,184 |
Consulting Fees |
JOSEF ZIHL |
7/31/2015 |
Common |
2,367 |
Consulting Fees |
FOUNTAINHEAD CAPITAL MANAGEMENT LIMITED |
8/5/2015 |
Series D. Pref. |
5,946 |
Series D Dividend |
PETER C. ZACHARIOU |
8/5/2015 |
Series D. Pref. |
2,194 |
Series D Dividend |
CRAIG KIRSCH |
8/5/2015 |
Series D. Pref. |
393 |
Series D Dividend |
LIOLIOS GROUP, INC. |
8/6/2015 |
Common |
2,646 |
Consulting Fees |
ACORN MANAGEMENT PTS |
8/15/2015 |
Common |
4,630 |
Consulting Fees |
LIOLIOS GROUP, INC. |
9/4/2015 |
Common |
2,096 |
Consulting Fees |
ACORN MANAGEMENT PTS |
9/15/2015 |
Common |
4,630 |
Consulting Fees |
JASON BARTON |
9/30/2015 |
Common |
1,056 |
Consulting Fees |
JOSE ROMANO |
9/30/2015 |
Common |
1,056 |
Consulting Fees |
OSCAR BRONSTHER |
9/30/2015 |
Common |
3,378 |
Board Fees |
LOWELL RUSH |
9/30/2015 |
Common |
3,378 |
Board Fees |
FOUNTAINHEAD CAPITAL MANAGEMENT LIMITED |
9/30/2015 |
Common |
16,667 |
Consulting Fees |
STEVE GIRGENTI |
10/1/2015 |
Common |
3,378 |
Board Fees |
LIOLIOS GROUP, INC. |
10/4/2015 |
Common |
2,252 |
Consulting Fees |
ALVARO PASCUAL-LEONE M.D. |
1/31/2015 |
Common |
1,995 |
Consulting Fees |
JOSEF ZIHL |
1/31/2015 |
Common |
2,216 |
Consulting Fees |
JASON BARTON |
12/31/2015 |
Common |
3,196 |
Consulting Fees |
JOSE ROMANO |
12/31/2015 |
Common |
3,196 |
Consulting Fees |
OSCAR BRONSTHER |
12/31/2015 |
Common |
5,682 |
Board Fees |
LOWELL RUSH |
12/31/2015 |
Common |
5,682 |
Board Fees |
STEVE GIRGENTI |
1/1/2016 |
Common |
5,682 |
Board Fees, Deferred |
FOUNTAINHEAD CAPITAL MANAGEMENT LIMITED |
12/31/2015 |
Common |
16,667 |
Consulting Fees |
ALVARO PASCUAL-LEONE M.D. |
1/31/2016 |
Common |
3,801 |
Consulting Fees |
JOSEF ZIHL |
1/31/2016 |
Common |
4,223 |
Consulting Fees |
FOUNTAINHEAD CAPITAL MANAGEMENT LIMITED |
2/5/2016 |
Series D. Pref. |
6,154 |
Series D Dividend |
PETER C. ZACHARIOU |
2/5/2016 |
Series D. Pref. |
2,720 |
Series D Dividend |
CRAIG KIRSCH |
2/5/2016 |
Series D. Pref. |
407 |
Series D Dividend |
|
12/31/2015 |
12/31/2014 |
12/31/2013 |
Revenues |
$1,138,634 |
$1,250,292 |
$1,089,374 |
Net loss |
$(2,082,643) |
$(4,049,712) |
$(2,444,491) |
Net loss per share |
$(0.21) |
$(0.39) |
$(0.39) |
Weighted average no. shares |
10,839,335 |
10,270,657 |
6,324,175 |
Stockholders’ equity (deficit) |
$1,145,722 |
$2,888,902 |
$(3,315,243) |
Total assets |
$2,030,231 |
$3,813,743 |
$2,115,250 |
Total liabilities |
$884,509 |
$924,841 |
$5,430,493 |
|
2015 |
2014 |
% Change |
Revenue: |
|
|
|
Vycor Medical |
$885,481 |
$893,028 |
-1% |
NovaVision |
$253,153 |
$357,264 |
-29% |
|
$1,138,634 |
$1,250,292 |
-9% |
Cost of Revenue: |
|
|
|
Vycor Medical |
$(107,528) |
$(112,604) |
5% |
NovaVision |
$(56,590) |
$(43,696) |
-30% |
|
$(164,118) |
$(156,300) |
-5% |
Gross Profit |
|
|
|
Vycor Medical |
$777,953 |
$780,424 |
0% |
NovaVision |
$196,563 |
$313,568 |
-37% |
|
$974,516 |
$1,093,992 |
-11% |
|
Cash G&A |
Non-Cash G&A |
2014 offering costs and expenses |
(589,208) |
- |
Payroll |
(1,629) |
25,011 |
Investor relations and road show costs |
(17,004) |
(90,647) |
Legal, professional and other consulting |
(70,384) |
- |
Sales, marketing and travel |
41,902 |
- |
Other |
(72,769) |
- |
Board, financial and scientific advisory |
3,286 |
(36,524) |
Total change |
$(705,806) |
$(102,160) |
|
31-Dec-15 |
31-Dec-14 |
$ Change |
Cash |
$347,477 |
$1,891,658 |
$(1,544,181) |
Accounts receivable, inventory and other current assets |
$511,216 |
$677,636 |
$(166,420) |
Total current liabilities |
$(877,009) |
$(924,841) |
$47,832 |
Working capital |
$(18,316) |
$1,644,453 |
$(1,662,769) |
Cash provided by (used in) financing activities |
$(85,300) |
$4,725,630 |
$(4,810,930) |
Paritz & Company, P.A. |
15 Warren Street, Suite 25
Hackensack, New Jersey 07601
(201)342-7753
Fax: (201) 342-7598
E-Mail: paritz @paritz.com |
Certified Public Accountants |
|
|
December 31, |
December 31, |
|
2015 |
2014 |
ASSETS |
|
|
Current Assets |
|
|
Cash |
$347,477 |
$1,891,658 |
Trade accounts receivable, net of allowance for doubtful accounts of $2,711 and $2,721 |
106,340 |
123,815 |
Inventory |
292,538 |
336,021 |
Prepaid expenses and other current assets |
112,338 |
217,800 |
Total Current Assets |
858,693 |
2,569,294 |
|
|
|
Fixed assets, net |
521,105 |
582,434 |
|
|
|
Intangible and Other assets: |
|
|
Trademarks |
251,157 |
251,157 |
Patents, net of accumulated amortization |
323,138 |
345,113 |
Website, net of accumulated amortization |
19,548 |
12,576 |
Security deposits |
49,090 |
53,169 |
Total Intangible and Other assets |
642,933 |
662,015 |
TOTAL ASSETS |
$2,022,731 |
$3,813,743 |
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
Current Liabilities |
|
|
Accounts payable |
$250,367 |
$221,703 |
Accrued interest: Other |
88,634 |
40,634 |
Accrued liabilities |
222,258 |
320,927 |
Derivative liability |
- |
19,792 |
Notes payable: Other |
315,750 |
321,785 |
Total Current Liabilities |
877,009 |
924,841 |
|
|
|
STOCKHOLDERS’ EQUITY |
|
|
Preferred stock, $0.0001 par value, 10,000,000 shares authorized, 252,336 and 235,560 issued and outstanding as at December 31, 2015 and December 31, 2014 respectively |
$25 |
$24 |
Common Stock, $0.0001 par value, 25,000,000 shares authorized at December 31, 2015 and 2014, 11,032,560 and 10,879,899 shares issued and 10,929,226 and 10,776,565 outstanding at December 31, 2015 and 2014 respectively |
1,103 |
1,088 |
Additional Paid-in Capital |
24,346,057 |
23,903,793 |
Treasury Stock (103,334 shares of Common Stock as at December 31, 2015 and 2014 respectively, at cost) |
(1,033 ) |
(1,033 ) |
Accumulated Deficit |
(23,332,538) |
(21,082,118) |
Accumulated Other Comprehensive Income |
132,108 |
67,148 |
Total Stockholders’ Equity |
1,145,722 |
2,888,902 |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY |
$2,022,731 |
$3,813,743 |
|
For the year ended December 31, | |
|
2015 |
2014 |
|
|
|
Revenue |
$1,138,634 |
$1,250,292 |
Cost of Goods Sold |
164,118 |
156,300 |
Gross Profit |
974,516 |
1,093,992 |
|
|
|
Operating expenses: |
|
|
Research and development |
71,512 |
69,114 |
Depreciation and Amortization |
360,334 |
368,605 |
General and administrative |
2,533,684 |
3,388,421 |
Total Operating expenses |
2,965,530 |
3,826,140 |
Operating loss |
(1,991,014) |
(2,732,148) |
|
|
|
Other income (expense) |
|
|
Interest expense: Related Party |
- |
(80,093) |
Interest expense: Other |
(47,710) |
(50,627) |
Gain (loss) on foreign currency exchange |
(63,711) |
(105,685) |
Loss on extinguishment of debt |
- |
(682,039) |
Loss on extension of warrants |
- |
(146,488) |
Change in fair value derivative liability |
19,792 |
(252,633) |
Total Other Income (expense) |
(91,629) |
(1,317,565) |
|
|
|
Loss Before Credit for Income Taxes |
(2,082,643) |
(4,049,713) |
Credit for income taxes |
- |
- |
Net Loss |
(2,082,643) |
(4,049,713) |
Preferred stock dividends |
(167,777) |
- |
Net Loss available to common shareholders |
(2,250,420) |
(4,049,713) |
Comprehensive Loss |
|
|
Foreign Currency Translation Adjustment |
(64,959) |
(112,318) |
Comprehensive Loss |
(2,315,379) |
(4,162,031) |
|
|
|
Net Loss Per Share |
|
|
Basic and diluted |
$(0.21) |
$(0.39) |
|
|
|
Weighted Average Number of Shares Outstanding – Basic and Diluted |
10,839,335 |
10,270,657 |
|
|
|
|
|
|
|
|
|
Additional |
|
|
|
|
Common Stock |
Preferred Stock - Series C |
Preferred Stock - Series D |
Treasury Stock |
Paid-in |
Accumulated |
Accum |
Total | ||||
|
Number |
Amount |
Number |
Amount |
Number |
Amount |
Number |
Amount |
Capital |
Deficit |
OCI (Loss) |
|
Balance at January 1, 2014 |
6,757,225 |
$675 |
1 |
$1 |
0 |
$- |
(103,334) |
$(1,033) |
$13,762,689 |
$(17,032,405) |
$(45,170) |
$(3,315,243) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of stock for board and consulting fees |
131,505 |
13 |
- |
- |
- |
- |
- |
- |
292,507 |
- |
- |
292,520 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Share-based compensation for consulting services |
- |
- |
- |
- |
- |
- |
- |
- |
5,522 |
- |
- |
5,522 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuances of shares and warrants pursuant to offering |
2,777,808 |
278 |
- |
- |
- |
- |
- |
- |
3,387,446 |
|
|
3,387,724 |
|
|
` |
|
|
|
|
|
|
|
|
|
|
Preferred shares issued in exchange for debt |
- |
- |
|
|
235,559 |
24 |
|
|
3,037,602 |
- |
- |
3,037,626 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Revaluation of warrants on extension |
|
|
|
|
|
|
|
|
146,488 |
- |
- |
146,488 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock issuance for conversion of preferred shares |
420,838 |
42 |
- |
(1) |
|
|
- |
- |
(162,059) |
|
|
(162,017) |
Common stock issuance for accrued consulting fees |
792,523 |
79 |
- |
- |
- |
- |
- |
- |
1,097,566 |
|
|
1,097,645 |
Reclassification of derivative liability to equity |
- |
- |
- |
- |
- |
- |
- |
- |
2,336,032 |
|
|
2,336,032 |
Accumulated Comprehensive Loss |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
112,318 |
112,318 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss for year ended December 31, 2014 |
|
|
|
|
|
|
|
|
|
(4,049,713) |
|
(4,049,713) |
Balance at December 31, 2014 |
10,879,899 |
$1,088 |
1 |
$- |
235,559 |
$24 |
(103,334) |
$(1,033) |
$23,903,793 |
$(21,082,118) |
$67,148 |
$2,888,902 |
Issuance of stock for board and consulting fees |
152,661 |
15 |
- |
- |
- |
- |
- |
- |
244,985 |
- |
- |
245,000 |
Share-based compensation for consulting service |
- |
- |
- |
- |
- |
- |
- |
- |
4,492 |
- |
- |
4,492 |
Share based compensation issued to employees |
|
|
- |
- |
- |
- |
- |
- |
25,011 |
- |
- |
25,011 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred stock dividends |
- |
- |
|
|
16,777 |
1 |
|
|
167,776 |
- |
- |
167,777 |
Accumulated Comprehensive Loss |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
64,960 |
64,960 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss for year ended December 31, 2015 |
|
|
|
|
|
|
|
|
|
(2,250,420) |
|
(2,250,420) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at December 31, 2015 |
11,032,560 |
$1,103 |
1 |
$- |
252,336 |
$25 |
(103,334) |
$(1,033) |
$24,346,057 |
$(23,332,538) |
$132,108 |
$1,145,722 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the year ended | |
|
December 31, | |
|
2015 |
2014 |
Cash flows from operating activities: |
|
|
Net loss |
(2,082,643) |
(4,049,713) |
Adjustments to reconcile net loss to cash used in operating activities: |
|
|
Amortization of intangible assets |
99,291 |
128,381 |
Depreciation of fixed assets |
269,672 |
254,608 |
Change in inventory provision |
12,633 |
2,567 |
Inventory write-off
|
20,804 |
|
Share based compensation |
274,502 |
376,662 |
(Gain) loss on foreign exchange |
63,711 |
105,685 |
Unrealized gain on change in fair value of derivative liability |
(19,792) |
252,633 |
Loss on extinguishment of debt |
- |
682,039 |
Loss on extension of warrants |
- |
146,488 |
|
|
|
Changes in assets and liabilities: |
|
|
Accounts receivable |
17,475 |
88,845 |
Inventory |
10,046 |
(131,663) |
Prepaid expenses |
184,726 |
(88,356) |
Accrued interest to related party |
- |
(255,034) |
Accrued interest other |
48,000 |
(90,617) |
Accounts payable |
28,665 |
(32,321) |
Accrued liabilities |
(98,669) |
(90,973) |
Security Deposit |
4,079 |
- |
|
|
|
Cash used in operating activities |
(1,167,500) |
(2,700,769) |
Cash flows from investing activities: |
|
|
Purchase of fixed assets |
(210,023) |
(130,845) |
Purchase of website |
(18,010) |
(13,842) |
Acquisition of patents |
(66,276) |
(26,455) |
Cash used in investing activities |
(294,309) |
(171,142) |
Cash flows from financing activities: |
|
|
Proceeds from issuance of Common stock and Warrants |
- |
5,000,000 |
Proceeds from issuance of Notes Payable: Other |
- |
83,486 |
Repayment of Notes Payable to Related Party |
- |
(126,519) |
Repayment of Notes Payable - Other |
(85,300) |
(231,337) |
Cash provided by (used in) financing activities |
(85,300) |
4,725,630 |
Effect of exchange rate changes on cash |
2,928 |
6,636 |
Net increase (decrease) in cash |
(1,544,181) |
1,860,355 |
Cash at beginning of year |
1,891,658 |
31,303 |
Cash at end of year |
347,477 |
1,891,658 |
|
|
|
Supplemental Disclosures of Cash Flow information: |
|
|
Interest paid: |
0 |
462,194 |
Non-Cash Transactions: |
|
|
Preferred stock dividends satisfied in new preferred stock |
$167,777 |
$- |
|
December 31, |
December 31, |
|
2015 |
2014 |
Stock options outstanding |
25,557 |
25,557 |
Warrants to purchase common stock |
6,007,048 |
5,911,715 |
Debentures convertible into common stock |
215,908 |
171,138 |
Preferred shares convertible into common stock |
1,188,471 |
1,110,438 |
Total |
7,436,984 |
7,218,848 |
|
December 31, 2015 |
December 31, 2014 |
On March 25, 2011 the Company issued a term note for $300,000 to EuroAmerican Investment Corp. (“EuroAmerican”). The term note bears interest at 16% per annum and was due June 25, 2011. In connection with the loan the Company also issued EuroAmerican warrants to purchase 400,000 shares of the Company’s common stock at an exercise price of $4.50 per share for
a period of three (3) years. On June 25, 2011 the due date for this note was extended to September 25, 2011 and the Holder was granted the right to convert all or any amount of the principal face amount of the debenture then outstanding and accrued interest into shares of common stock of the Company an adjusted conversion price of $1.80 per share, subject to adjustment and does not require bifurcation. The due date for this note has been extended to December 31, 2016. |
300,000 |
300,000 |
|
|
|
|
|
|
Insurance policy finance agreements. During the year ended December 31, 2015 the Company made monthly repayments totaling $85,800. The notes are due over the next twelve months. |
15,750 |
21,786 |
|
|
|
Total Other Notes Payable: |
$315,750 |
$321,786 |
| ||
|
December 31, | |
|
2015 |
2014 |
Revenue: |
|
|
Vycor Medical |
$885,481 |
$893,028 |
NovaVision |
253,153 |
357,264 |
Total Revenue |
$1,138,634 |
$1,250,292 |
Gross Profit: |
|
|
Vycor Medical |
777,953 |
780,424 |
NovaVision |
196,563 |
313.568 |
Total Gross Profit |
$974,516 |
$1,093,992 |
Total Assets: |
|
|
Vycor Medical |
$1,157,790 |
$2,644,513 |
NovaVision |
872,441 |
1,169,230 |
Total Assets |
$2,030,231 |
$3,813,743 |
|
December 31, | |
|
2015 |
2014 |
Revenue: |
|
|
United States |
$985,868 |
$1,034,034 |
Europe |
152,766 |
216,258 |
Total Revenue |
$1,138,634 |
$1,250,292 |
Gross Profit: |
|
|
United States |
$844,298 |
$901,503 |
Europe |
132,218 |
192,489 |
Total Gross Profit |
$974,516 |
$1,093,992 |
Total Assets: |
|
|
United States |
$1,707,089 |
$3,367,679 |
Europe |
323,142 |
446,064 |
Total Assets |
$2,030,231 |
$3,813,743 |
|
|
December 31, |
December 31, |
|
Estimated Useful Lives |
2015 |
2014 |
|
|
|
|
Machinery and equipment |
3 years |
$132,452 |
$136,356 |
Leasehold Improvements |
5 years |
6,206 |
6,206 |
Purchased Software |
3 years |
27,706 |
24,993 |
Molds and Tooling |
5 years |
381,397 |
234,230 |
Furniture and fixtures |
7 years |
26,028 |
20,079 |
Therapy Devices |
3 years |
99,324 |
86,286 |
Internally Developed Software |
5 years |
1,174,912 |
1,143,918 |
|
1,848,025 |
1,652,068 | |
Less: Accumulated depreciation and amortization |
|
(1,326,920) |
(1,069,634) |
Property and Equipment, net |
|
$521,105 |
$582,434 |
|
December 31, | |
|
2015 |
2014 |
Amortized intangible assets: Patent (8 years useful life) |
|
|
Gross carrying Amount |
$865,639 |
$799,362 |
Accumulated Amortization |
(542,501) |
(454,249) |
|
$323,138 |
$345,113 |
Amortized intangible assets: Website (5 years useful life) |
|
|
Gross carrying Amount |
$50,760 |
$32,750 |
Accumulated Amortization |
$(31,212) |
$(20,174) |
|
$19,548 |
$12,576 |
Intangible assets not subject to amortization |
|
|
Trademarks |
$251,157 |
$251,157 |
STOCK WARRANTS: |
|
Weighted average |
|
Number of shares |
exercise price |
|
|
per share |
Outstanding at December 31, 2013 |
1,404,599 |
$ 3.39 |
Granted |
5,226,120 |
$2.61 |
Exercised |
- |
- |
Cancelled or expired |
(719,004) |
$4.46 |
Outstanding at December 31, 2014 |
5,911,715 |
$2.57 |
Granted |
100,000 |
$2.56 |
Exercised |
- |
- |
Cancelled or expired |
(4,667) |
- |
Outstanding at December 31, 2015 |
6,007,048 |
$2.57 |
|
|
|
STOCK OPTIONS: |
|
Weighted average |
|
Number of shares
|
|
|
|
per share |
Outstanding at December 31, 2013 |
5,557 |
$20.25 |
Granted |
20,000 |
$2.00 |
Exercised |
- |
- |
Cancelled or expired |
- |
- |
Outstanding at December 31, 2014 |
5,557 |
$20.25 |
Granted |
- |
- |
Exercised |
- |
- |
Cancelled or expired |
- |
- |
Outstanding at December 31, 2015 |
25,557 |
$5.97 |
|
Year ended December 31, | |
|
2015 |
2014 |
Risk-free interest rates |
1.07% |
0.78% |
Expected life |
3 years
|
3 years |
Expected dividends |
0% |
0% |
Expected volatility |
101% |
75% |
Vycor Common Stock fair value |
$2.00 |
$2.05 |
Description |
December 31, 2015
|
Level 1
|
Level 2
|
Level 3
|
|
|
|
|
|
Warrant Liability |
$- |
$- |
$- |
$- |
Description |
December 31, 2014
|
Level 1
|
Level 2
|
Level 3
|
|
|
|
|
|
Warrant Liability |
$19,792 |
$- |
$- |
$19,792 |
Balance at January 1, 2014
|
$- |
Issuance of Series A Warrants and Placement Agent Warrants as part of Offering Units on January 2, January 31, February 24, February 28 and March 31, April 25, 2014
|
2,103,195 |
Change in fair value during period
|
252,633 |
Reclassification to equity from waiver of anti-dilution on May 15, 2014
|
(2,336,036) |
Balance at December 31, 2014
|
$19,792 |
Change in fair value during period
|
(19,792) |
Balance at December 31, 2015
|
$- |
|
Year ended December 31,
| |
|
2015
|
2014
|
|
|
|
Risk-free interest rates |
0.56-.73% |
0.58-0.93% |
Expected life |
1.65 years
|
2.09 – 3.00 years
|
Expected dividends |
0% |
0% |
Expected volatility |
90-93% |
71-97% |
Vycor Common Stock fair value |
$1.59-1.84 |
$1.79-$2.70 |
|
December 31, 2015 |
December 31, 2014 |
Domestic |
$1,706,722 |
$3,646,424 |
Foreign |
375,921 |
403,289 |
|
$2,082,643 |
$4,049,713 |
|
Year Ended December 31, | |
|
2015 |
2014 |
|
|
|
US statutory rate |
$(728,925) |
$(1,417,399) |
Tax difference between foreign and U.S. |
28,528 |
28,909 |
Change in Valuation Allowance |
(700,397) |
(1,388,490) |
Tax Provision |
$- |
$- |
|
December 31, 2015 |
December 31, 2014 |
Operating loss carry-forward |
$5,600,000 |
$4,800,000 |
Deferred tax asset before Valuation allowance |
5,600,000 |
4,800,000 |
Valuation allowance |
(5,600,000) |
(4,800,000) |
Net deferred tax asset |
$— |
$— |
Directors and Executive Officers
|
Position/Title
|
Age
|
Peter C. Zachariou |
Chief Executive Officer and a Director |
54 |
David Marc Cantor |
President and a Director |
49 |
Adrian Christopher Liddell |
Chairman of the Board, Chief Financial Officer and a Director |
57 |
Steven Girgenti |
Director |
70 |
Oscar Bronsther, M.D. |
Director |
63 |
Lowell Rush |
Director |
59 |
Pascale Mangiardi |
Director |
43 |
Name and Principal Position
|
Year
|
Salary($)
|
Bonus($)
|
StockAwards($)
|
OptionAwards($)
|
Non-EquityIncentive PlanCompensation
|
Non-Qualified DeferredCompensation Earnings($)
|
All otherCompensation($)
|
Total($)
|
Peter Zachariou
|
2014 |
$— |
— |
— |
— |
— |
— |
— |
— |
CEO
|
2015 |
$— |
— |
— |
— |
— |
— |
— |
— |
David Cantor
|
2014 |
$— |
— |
— |
— |
— |
— |
— |
— |
President
|
2015 |
$— |
— |
— |
— |
— |
— |
— |
— |
|
|
Option Awards
| |||
Name
|
Grant Date Number
of Securities Underlying
Unexercised Options (#) Exercisable |
Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#)
|
Number of Securities Underlying Unexercised Options (#) Unexercisable (1)
|
OptionExercise Price($)
|
OptionExpiration Date
|
Kenneth T. Coviello |
2/15/2008 |
- |
3,334 |
$20.25 |
2/12/2018 |
|
|
|
|
| |
Heather N. Vinas |
2/15/2008 |
- |
2,223 |
$20.25 |
2/12/2018 |
Equity Compensation Plan Information
| |||
Plan category
|
Number of securitiesto be issued uponexercise of outstandingoptions, warrants and rights(a)
|
Weighted-averageexercise price ofoutstanding options,warrants and rights
|
Number of securitiesremaining available forfuture issuance underequity compensationplans (excluding securitiesreflected in column (a)
|
Equity compensation plans approved by security holders |
6,667 |
$20.25 |
17,676 |
Equity compensation plans not approved by security holders |
3,333 |
28.50 |
– |
Total |
7,000 |
$20.70 |
17,676 |
Name
|
|
Grant Date
|
|
Number of Securities Underlying Unexercised ExercisableWarrants
|
|
Number of Securities Underlying Unexercised ExercisableWarrants
|
|
WarrantExercise Price($)
|
|
WarrantExpiration Date
|
None
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
|
-
|
|
|
|
|
|
|
Title of Class
|
|
Name and Address of Beneficial Owner
|
|
Amount and Nature of Beneficial Owner (1)
|
|
Percent of Class (2)
|
Common Stock |
|
Steven Girgenti
|
|
55,475
|
|
*
|
Common Stock |
|
Oscar Bronsther, M.D
|
|
40,155
|
|
*
|
Common Stock |
|
Lowell Rush
|
|
28,192
|
|
*
|
Common Stock |
|
Pascale Mangiardi
|
|
--
|
|
0.00%
|
Common Stock |
|
Adrian Christopher Liddell
|
|
--
|
|
0.00%
|
Common Stock |
|
Marc David Cantor
|
|
--
|
|
0.00%
|
Common Stock
|
|
Peter C. Zachariou
|
|
211,239
|
|
1.89%
|
Series D Preferred Stock
|
|
Peter C. Zachariou
|
|
67,138
|
|
25.71%
|
Common Stock |
|
All executive officers and directors as a group
|
|
335,061
|
|
3.00%
|
Series D Preferred Stock
|
|
All executive officers and directors as a group
|
|
67,138
|
|
25.71%
|
Common Stock |
|
Fountainhead Capital Management Limited Portman House Hue Street, St. Helier, Jersey JB4 5RP
|
|
4,416,663
|
|
49.78%
|
Series D Preferred Stock
|
|
Fountainhead Capital Management Limited Portman House Hue Street, St. Helier, Jersey JB4 5RP
|
|
181,994
|
|
69.68%
|
Exhibit No.
|
Identification of Exhibit
|
|
Certification of the Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
Vycor Medical, Inc.
|
|
|
(Registrant)
|
|
|
|
|
By:
|
/s/ Peter C. Zachariou
|
|
|
Peter C. Zacharion
|
|
|
Chief Executive Officer and Director (Principal Executive Officer)
|
|
Date
|
March 30, 2016
|
|
|
|
|
By:
|
/s/ Adrian Liddell
|
|
|
Adrian Liddell
|
|
|
Chairman of the Board and Director
|
|
|
(Principal Financial and Accounting Officer)
|
|
Date
|
March 30, 2016
|
|
|
|
|
By:
|
/s/ Peter C. Zachariou
|
|
|
Peter C. Zachariou
|
|
|
Chief Executive Officer and Director
|
|
Date
|
March 30, 2016
|
|
|
|
|
By:
|
/s/ David Marc Cantor
|
|
|
David Marc Cantor
|
|
|
President and Director (Principal Executive Officer)
|
|
Date
|
March 30, 2016
|
|
By:
|
/s/ Adrian Christopher Liddell
|
|
|
Adrian Christopher Liddell
|
|
|
Chairman of the Board and Director (Principal Financial and Accounting Officer)
|
|
|
|
|
Date
|
March 30, 2016
|
|
By:
|
/s/ Steven Girgenti
|
|
|
Steven Girgenti
|
|
|
Director
|
|
Date
|
March 30, 2016
|
|
|
|
|
By:
|
/s/ Oscar Bronsther, M.D.
|
|
|
Oscar Bronsther, M.D.
|
|
|
Director
|
|
Date
|
March 30, 2016
|
|
|
|
|
By:
|
/s/ Lowell Rush
|
|
|
Lowell Rush
|
|
|
Director
|
|
Date
|
March 30, 2016
|
|
|
|
|
By:
|
|
|
|
Pascale Mangiardi
|
|
|
Director
|
|
Date
|
March 30, 2016
|
|
1. |
I have reviewed this Form 10-K for the period ended December 31, 2015 of Vycor Medical, Inc.; | ||
|
| |||
|
2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | ||
|
| |||
|
3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; | ||
|
| |||
|
4. |
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: | ||
|
| |||
|
|
|
a. |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
|
| |||
|
|
|
b. |
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
|
| |||
|
|
|
c. |
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
|
| |||
|
|
|
d. |
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
|
|
|
| |
|
5. |
I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): | ||
|
| |||
|
|
|
a. |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
|
| |||
|
|
|
b. |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
|
|
Date: March 30, 2016 | |
| |
| |
/s/ Peter Zachariou |
|
Peter C. Zachariou | |
Principal Executive Officer |
|
1. |
I have reviewed this Form 10-K for the period ended December 31, 2015 of Vycor Medical, Inc.; | ||
|
|
| ||
|
2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | ||
|
| |||
|
3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; | ||
|
| |||
|
4. |
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: | ||
|
| |||
|
|
|
a. |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
|
| |||
|
|
|
b. |
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
|
| |||
|
|
|
c. |
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
|
| |||
|
|
|
d. |
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
|
|
| ||
|
5. |
I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): | ||
|
| |||
|
|
|
a. |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
|
| |||
|
|
|
b. |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
|
|
Date: March 30, 2016 | |
| |
| |
/s/ Adrian Liddell |
|
Adrian Liddell | |
Principal Financial Officer |
/s/ Peter Zachariou |
|
Peter Zachariou | |
Principal Executive Officer |
/s/ Adrian Liddell |
|
Adrian Liddell | |
Principal Accounting Officer |
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Document and Entity Information - EUR (€) |
12 Months Ended | ||
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Dec. 31, 2015 |
Mar. 25, 2016 |
Jun. 30, 2015 |
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Document and Entity Information [Abstract] | |||
Entity Registrant Name | VYCOR MEDICAL INC | ||
Entity Central Index Key | 0001424768 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2015 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2015 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Public Float | € 8,397,712 | ||
Entity Common Stock, Shares Outstanding | 10,937,250 |
Consolidated Balance Sheets (Parenthetical) |
Dec. 31, 2015
$ / shares
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Dec. 31, 2015
EUR (€)
shares
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Dec. 31, 2014
$ / shares
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Dec. 31, 2014
EUR (€)
shares
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Statement of Financial Position [Abstract] | ||||
Allowance for doubtful accounts receivable | € | € 2,711 | € 2,721 | ||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | ||
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | ||
Preferred stock, shares issued | 252,336 | 235,560 | ||
Preferred stock, shares outstanding | 252,336 | 235,560 | ||
Common Stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | ||
Common Stock, shares authorized | 25,000,000 | 25,000,000 | ||
Common Stock, shares issued | 11,032,560 | 10,879,899 | ||
Common Stock, shares outstanding | 10,879,899 | 10,776,565 | ||
Treasury Stock, shares | 103,334 | 103,334 |
Formation and Business of the Company |
12 Months Ended |
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Dec. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
FORMATION AND BUSINESS OF THE COMPANY |
Business Description
Vycor Medical, Inc. (the Company) designs, develops and markets neurological medical devices and therapies through two operating divisions: Vycor Medical and NovaVision. Vycor Medical focuses on brain and cervical surgical access systems for sale to hospitals and medical professionals; NovaVision focuses on neuro-stimulation therapies and diagnostic devices for the treatment and screening of vision field loss resulting from neurological damage. |
Going Concern |
12 Months Ended |
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Dec. 31, 2015 | |
Going Concern | |
Going Concern | The Companys financial statements have been presented on a basis that contemplates the realization of assets and the satisfaction of liabilities in the normal course of business and assumes the Company will continue as a going concern. The Company has incurred losses since its inception, including a net loss of $2,082,643 for the year ended December 31, 2015, and the Company expects to continue to incur additional losses in the future, including additional development costs, costs related to marketing and manufacturing expenses. The Company has incurred negative cash flows from operations since inception. As of December 31, 2015 the Company had a stockholders equity of $1,145,722 and cash and cash equivalents of $347,477. The Company believes it would not have enough cash to meet its various cash needs unless the Company is able to obtain additional cash from the issuance of debt or equity securities. There is no assurance that additional funds from the issuance of equity will be available for the Company to finance its operations on acceptable terms. If adequate funds are not available, the Company may have to delay development or commercialization of products or technologies that the Company would otherwise seek to commercialize, or cease some or all of its operations. These conditions raise substantial doubt about the Companys ability to continue as a going concern. The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the outcome of this uncertainty. |
Significant Accounting Policies |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2015 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SIGNIFICANT ACCOUNTING POLICIES | Principles of Consolidation and Basis of Presentation The consolidated financial statements include the accounts of Vycor Medical, Inc., and its wholly-owned subsidiaries, NovaVision, Inc. (a Delaware corporation), NovaVision GmbH (a German corporation) and Sight Science Limited (a UK corporation), both wholly owned subsidiaries of NovaVision, Inc. The Company is headquartered in Boca Raton, FL. All material inter-company accounts, transactions, and balances have been eliminated in consolidation. Certain reclassifications and format changes have been made to prior year amounts to conform to the current year presentation.
Revenue Recognition Vycor Medical generates revenue from the sale of its surgical access system to hospitals and other medical professionals. Vycor Medical records revenue when a completed contract for the sale exists, the product is invoiced and shipped to the customer. Vycor Medical does not provide for product returns or warranty costs.
NovaVision generates revenues from various programs, therapy services and other sources such as license sales. Therapy services revenues represent fees from NovaVisions vision restoration therapy software, eye movement training software, diagnostic software, clinic set up and training fees, and the professional and support services associated with the therapy. NovaVision provides vision restoration therapy directly to patients. The typical vision restoration therapy consists of six modules, performed on average over 6 months in the U.S. and U.K. and 10 months in Germany. A patient contract comprises set-up fees and monthly therapy fees. Set-up fees are recognized at the outset of the contract and therapy revenue is recognized ratably over the therapy period. Patient therapy is restricted to being completed by a patient within a specified time frame. NovaVisions saccadic training software is generally completed within 2-4 weeks and revenue is therefore recognized fully at commencement.
Deferred revenue results from patients paying for the therapy in advance of receiving the therapy.
Cash and cash equivalents The Company maintains cash balances at various financial institutions. Accounts at each institution are insured by the Federal Deposit Insurance Corporation up to $250,000. Cash balances may at times exceed the FDIC insured limits. Cash also includes a US investment account in a money market backed by government securities up to 105% of the account balance. The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. Included within cash are deposits paid by patients, held by the Company until the patient returns the VRT device or chinrest at the end of therapy. At December 31, 2015 and 2014 patient deposits amounted to $27,183 and $32,869, respectively, and are included in Other Current Liabilities.
Accounts Receivable and Allowance for Doubtful Accounts Receivable We have a policy of reserving for uncollectible accounts based on our best estimate of the amount of probable credit losses in our existing accounts receivable. We extend credit to our customers based on an evaluation of their financial condition and other factors. We generally do not require collateral or other security to support accounts receivable. We perform ongoing credit evaluations of our customers and maintain an allowance for potential bad debts if required. We determine whether an allowance for doubtful accounts is required by evaluating specific accounts where information indicates the customers may have an inability to meet financial obligations. In these cases, we use assumptions and judgment, based on the best available facts and circumstances, to record a specific allowance for those customers against amounts due to reduce the receivable to the amount expected to be collected. These specific allowances are re-evaluated and adjusted as additional information is received. The amounts calculated are analyzed to determine the total amount of the allowance. We may also record a general allowance as necessary. Direct write-offs are taken in the period when we have exhausted our efforts to collect overdue and unpaid receivables or otherwise evaluate other circumstances that indicate that we should abandon such efforts.
Inventories Inventories are stated at the lower of cost determined using the weighted average cost method or market. Net realizable value is the estimated selling price, in the ordinary course of business, less estimated costs to complete and dispose of the product. If the Company identifies excess, obsolete or unsalable items, its inventories are written down to their realizable value in the period in which the impairment is first identified. The provision for inventory obsolescence for the years ended December 31, 2015 and 2014 was ,$29,923 and $17,200, respectively. Shipping and handling costs incurred for inventory purchases and product shipments are recorded in cost of sales in the Company's consolidated statements of operations.
Foreign Currency The Euro is the local currency of the country in which NovaVision GmbH conducts its operations and is considered the functional currency of this entity; the GB Pound is the local currency of the country in which Sight Science Limited conducts its operations and is considered the functional currency of this entity. All balance sheet amounts are translated to U.S. dollars using the U.S. exchange rate at the balance sheet date except for the equity section which is translated at historical rates. Operating statement amounts are translated using an average exchange rate for the period of operations. Foreign currency translation effects are accumulated as part of the accumulated other comprehensive income (loss) and included in stockholders equity in the accompanying Consolidated Balance Sheet.
Educational marketing and advertising expenses The Company may incur costs for the education of customers on the uses and benefits of its products. The Company will include education, marketing and advertising expense as a component of selling, general and administrative costs as such costs are incurred.
Income taxes We use the asset and liability method of accounting for income taxes in accordance with ASC Topic 740, Income Taxes. Under this method, income tax expense is recognized for the amount of: (i) taxes payable or refundable for the current year and (ii) deferred tax consequences of temporary differences resulting from matters that have been recognized in an entitys financial statements or tax returns. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is provided to reduce the deferred tax assets reported if based on the weight of the available positive and negative evidence, it is more likely than not some portion or all of the deferred tax assets will not be realized.
ASC Topic 740.10.30 clarifies the accounting for uncertainty in income taxes recognized in an enterprises financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC Topic 740.10.40 provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. We have no material uncertain tax positions for any of the reporting periods presented.
Fixed assets Fixed assets are stated at cost less accumulated depreciation. Depreciation is provided for on a straight-line basis over the useful lives of the assets. Expenditures for additions and improvements are capitalized; repairs and maintenance are expensed as incurred.
Derivative Liability The Company has accounted for the 34,723 Series A Warrants issued in connection with the 2014 Offering (all as defined in Note 10), the holders of which had not waived their anti-dilution rights (as detailed further in Note 10) in accordance with the guidance contained in ASC 815-40-15-7D, whereby under that provision, because they had anti-dilution rights, they did not meet the criteria for equity treatment and must be recorded as a liability. Accordingly, the Company classified the warrant instrument as a liability at its fair value and adjusted the instrument to fair value at each reporting period. This liability was subject to re-measurement at each balance sheet date until exercised or until the anti-dilution provisions contained within the warrant agreements expired, and was classified in the balance sheet as a current liability. Any change in fair value of the warrant liability was recognized in the Companys statement of operations as other income (loss). The anti-dilution provisions expired on June 11, 2015 and accordingly the liability has been extinguished. Impairment of long-lived assets Long-lived assets are reviewed for impairment when circumstances indicate the carrying value of an asset may not be recoverable. For assets that are to be held and used, impairment is recognized when the estimated undiscounted cash flows associated with the asset or group of assets is less than their carrying value. If impairment exists, an adjustment is made to write the asset down to its fair value, and a loss is recorded as the difference between the carrying value and fair value. Fair values are determined based on quoted market values, discounted cash flows or internal and external appraisals, as applicable. Assets to be disposed of are carried at the lower of carrying value or estimated net realizable value.
Research and Development The Company expenses all research and development costs as incurred. For the years ended December 31, 2015 and 2014, the amounts charged to research and development expenses were $71,512 and $69,114, respectively.
Software Development Costs The Company accounts for software development costs in accordance with ASC 350-40, whereby all costs incurred during the preliminary stage of a development project should be charged to expense as incurred. Capitalization of costs begins after the preliminary stage has been completed, management commits to funding the project, it is probable that the project will be completed, and the software will be used for its intended function. All post-implementation costs are charged to expense as incurred. Accordingly, direct internal and external costs associated with the development of the features and functionality of the Companys software, incurred during the application development stage, are capitalized and amortized using the straight-line method of the estimated life of five years. The Company acquired internally developed software valued at $540,000 as part of the acquisition of the assets of NovaVision, Inc. on November 30, 2010 and $363,472 as part of the acquisition of the assets of Sight Science Limited on January 4, 2012. For the years ended December 31, 2015 and 2014, the amounts capitalized for software development were $32,843 and $124,660 respectively, for the Companys VRT 7.0 and NeuroEyeCoach programs.
Uses of estimates in the preparation of financial statements The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimated. To the extent managements estimates prove to be incorrect, financial results for future periods may be adversely affected. Significant estimates and assumptions contained in the accompanying consolidated financial statements include managements estimate of the allowance for uncollectible accounts receivable, amortization of intangible assets, and the fair values of options and warrants included in the determination of debt discounts and share based compensation.
Stock Compensation The Company recognizes the cost of all share-based payments under the relevant authoritative accounting guidance. Share-based payments include any remuneration paid by the Company in shares of the Companys common stock or financial instruments that grant the recipient the right to acquire shares of the Companys common stock. For share-based payments to employees, which consist only of awards made under the stock option plan described below, the Company accounts for the payments in accordance with the provisions of ASC Topic 718, Stock Compensation. Share-based payments to consultants, service providers and other non-employees are accounted for under in accordance with ASC Topic 718, ASC Topic 505, Equity Payments to Non-Employees or other applicable authoritative guidance.
Convertible Instruments We evaluate and account for conversion options embedded in convertible instruments in accordance with ASC 815 Derivatives and Hedging Activities.
Applicable GAAP requires companies to bifurcate conversion options from their host instruments and account for them as free standing derivative financial instruments according to certain criteria. The criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under other GAAP with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument.
We account for convertible instruments (when we have determined that the embedded conversion options should not be bifurcated from their host instruments) as follows: We record when necessary, discounts to convertible notes for the intrinsic value of conversion options embedded in debt instruments based upon the differences between the fair value of the underlying common stock at the commitment date of the note transaction and the effective conversion price embedded in the note. Debt discounts under these arrangements are amortized over the term of the related debt to their stated date of redemption. The embedded conversion option in connection with our convertible debt could not be exercised unless and until we completed a Qualifying Financing transaction. Accordingly, we determined based on authoritative guidance that the embedded conversion option is deemed to be a contingent conversion rather than active conversion option that did not require accounting recognition at the commitment dates of the issuances of the Notes.
Common Stock Purchase Warrants and Other Derivative Financial Instruments We classify as equity any contracts that require physical settlement or net-share settlement or provide us a choice of net-cash settlement or settlement in our own shares (physical settlement or net-share settlement) provided that such contracts are indexed to our own stock as defined in ASC 815-40 ("Contracts in Entity's Own Equity"). We classify as assets or liabilities any contracts that require net-cash settlement (including a requirement to net cash settle the contract if an event occurs and if that event is outside our control) or give the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement). We assess classification of our common stock purchase warrants and other free standing derivatives at each reporting date to determine whether a change in classification between assets and liabilities is required.
Fair Value Measurements We adopted the provisions of ASC Topic 820, Fair Value Measurements and Disclosures, which defines fair value as used in numerous accounting pronouncements, establishes a framework for measuring fair value and expands disclosure of fair value measurements.
The estimated fair value of certain financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and accrued expenses are carried at historical cost basis, which approximates their fair values because of the short-term nature of these instruments. The carrying amounts of our short and long term credit obligations approximate fair value because the effective yields on these obligations, which include contractual interest rates taken together with other features such as concurrent issuances of warrants and/or embedded conversion options, are comparable to rates of returns for instruments of similar credit risk.
ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 describes three levels of inputs that may be used to measure fair value:
Level 1 quoted prices in active markets for identical assets or liabilities Level 2 quoted prices for similar assets and liabilities in active markets or inputs that are observable Level 3 inputs that are unobservable (for example cash flow modeling inputs based on assumptions)
Net Loss Per Share Basic net loss per share is computed by dividing net loss by the weighted-average number of common shares outstanding during the period. Diluted net loss per share is computed giving effect to all dilutive potential common shares that were outstanding during the period. Dilutive potential common shares consist of incremental shares issuable upon exercise of stock options and warrants and conversion of preferred stock and convertible debt. Such potentially dilutive shares are excluded when the effect would be to reduce a net loss per share. No dilution adjustment has been made to the weighted average outstanding common shares in the periods presented because the assumed exercise of outstanding options and warrants and the conversion of preferred stock and debt would be anti-dilutive.
The following table sets forth the potential shares of common stock that are not included in the calculation of diluted net loss per share:
Recent Accounting Pronouncements From time to time new accounting pronouncements are issued by the Financial Accounting Standards Board or other standard setting bodies that may have an impact on the Companys accounting and reporting. The Company believes that such recently issued accounting pronouncements and other authoritative guidance for which the effective date is in the future will not have an impact on its accounting or reporting or that such impact will not be material to its financial position, results of operations and cash flows when implemented. |
Notes Payable |
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Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
NOTES PAYABLE | Other Notes Payable
As of December 31, 2015 and 2014 Other Notes Payable consists of:
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Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SEGMENT REPORTING, GEOGRAPHICAL INFORMATION |
(a) Business segments The Company operates in two business segments: Vycor Medical, which focuses on devices for neurosurgery; and NovaVision, which focuses on neuro stimulation therapies and diagnostic devices for the treatment and screening of vision field loss. Set out below are the revenues, gross profits and total assets for each segment.
(b) Geographic information. The Company operates in two geographic segments, the United States and Europe. Set out below are the revenues, gross profits and total assets for each segment.
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Fixed Assets |
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Property, Plant and Equipment [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FIXED ASSETS | As of December 31, 2015 and 2014, Fixed Assets and the estimated lives used in the computation of depreciation are as follows:
Depreciation expense for the years ended December 31, 2015 and 2014 was $269,672 and $254,608 respectively, including $8,629 and $14,383 respectively for Therapy Devices which is allocated to Cost of Sales. |
Intangible Assets |
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INTANGIBLE ASSETS | As of December 31, 2015 and 2014, Intangible Assets consists of:
Intangible asset amortization expense for the periods ended December 31, 2015 and 2014 was $99,291and $128,381, respectively. |
Equity |
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
EQUITY | Equity Transactions During January to December 2015, the Company issued: 12,180 shares of Common Stock (valued at $20,000) to Steven Girgenti, 15,145 shares of Common Stock (valued at $20,000) to Oscar Bronsther and 15,145 shares of Common Stock (valued at $20,000) to Lowell Rush in consideration for services provided to the Board of Directors; and 5,023 shares of Common Stock (valued at $7,500) to Alvaro Pasual-Leone, 8,270 shares of Common Stock (valued at $12,500) to Josef Zihl and 6,153 shares of Common Stock (valued at $7,500) to each of Jason Barton and Jose Romano in respect of their roles as members of the NovaVision, Inc. Scientific Advisory Board. During January to December 2015, in accordance with the terms the Consulting Agreement, the Company issued 49,819 shares of Common Stock (valued at $90,000) to Fountainhead. During 2015, in accordance with the terms of investor relations advisory agreements, the Company issued 27,779 shares of Common Stock (valued at $50,000) to Acorn Partners, LLC and 6,994 shares of Common Stock (valued at $10,000) to Liolios Group Inc. During 2015 Series D Preferred Stock, convertible into shares of Common Stock at $2.15, was issued in respect of Preferred Dividends as follows: 11,691 shares of Series D Preferred Stock (valued at $116,915), convertible into 54,377 shares of Common Stock to Fountainhead; 4,313 shares of Series D Preferred Stock (valued at $43,130), convertible into 20,060 shares of Common Stock to Peter Zachariou; and 773 shares of Series D Preferred Stock (valued at $7,731), convertible into 3,595 shares of Common Stock to Craig Kirsch. Outstanding Warrants and Options The details of the outstanding rights, options and warrants and value of such rights, options and warrants are as follows:
As of December 31, 2015, the weighted-average remaining contractual life of outstanding warrants and options is 1.25 and 2.18 years, respectively. |
Share-Based Compensation |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | Stock Option Plan
Under ASC Topic 718, the Company estimates the fair value of option awards on the date of grant using an option pricing model. The grant date fair value is recognized over the option vesting period, the period during which an employee is required to provide service in exchange for the award. No compensation cost is recognized for equity instruments for which employees do not render the requisite service. Under these standards, compensation cost for employee cost for employee stock-based awards is based on the estimated grant-date fair value and recognized over the vesting period of the applicable award on a straight-line basis.
For the years ended December 31, 2015 and 2014, the Company recognized share-based compensation of $25,011 and $0, respectively for the issuance of stock options.
Stock appreciation rights may be granted either on a stand alone basis or in conjunction with all or part of any other stock options granted under the plan. As of December 31, 2015 there were no awards of any stock appreciation rights.
The Company from time to time issues common stock, stock options or common stock warrants to acquire services or goods from non-employees. Common stock, stock options and common stock warrants issued to other than employees or directors are recorded on the basis of their fair value, which is measured as of the measurement date using an option pricing model. The measurement date for options and warrants related to contracts that have substantial disincentives to non-performance is the date of the contract, and for all other contracts is the vesting date. Expense related to the options and warrants is recognized on a straight-line basis over the shorter of the period over which services are to be received or the life of the option or warrant.
Aggregate stock-based compensation expense charged to operations for stock and warrants granted to the above non-employees for the year ended December 31, 2014 was $249,492. As of December 31, 2015, there was $0 of total unrecognized compensation costs related to warrant and stock awards and non-vested options.
Stock-based Compensation Valuation Methodology
Stock-based compensation resulting from the issuance of Common Stock is calculated by reference to the valuation of the Stock on the date of issuance, the expense being recognized as the compensation is earned. Stock-based compensation expenses related to employee options and warrants granted to non-employees are recognized as the stock options and warrants are earned. The fair value of the stock options or warrants granted is estimated at the grant date, using the Black-Scholes option pricing model, and the expense is recognized on a straight-line basis over the shorter of the period over which services are to be received or the life of the option or warrant. The grant date fair value of employee share options and similar instruments is estimated using the Black-Scholes option pricing model on the basis of the fair value of the underlying common stock on the measurement date, adjusted for the unique characteristics of those equity instruments, using the assumptions noted in the table below. The fair value of the common stock is determined by the then-prevailing private placement purchase price. Expected volatility was based on the historical volatility of a peer group of publicly traded companies. The expected term of options and warrants was based upon the life of the option, and the risk-free rate used was based on the U.S. Treasury Constant Maturity rate.
The stock compensation expensed during the year ended December 31, 2014 resulted only from the issuance of Common Stock valued on the date of issuance. The following assumptions were used in calculations of the Black-Scholes option pricing model for warrant-based stock compensation in year ended December 31, 2014:
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Fair Value Measurements |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FAIR VALUE MEASUREMENTS | The Company has adopted ASC 820 for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period. The adoption of ASC 820 did not have an impact on the Companys financial position or results of operations. Under the terms of the Offering, during the period January 2 to April 25, 2014, in five separate closings, a total of 2,397,631 Series A Warrants and Placement Agent Warrants were issued as part of the Offering, which carried anti-dilution rights. Effective May 15, 2014 these anti-dilution rights were waived for all but 34,723 of the Series A Warrants and for all of the Placement Agent Warrants. The Company accounts for the Series A Warrants in accordance with the guidance contained in ASC 815-40-15-7D, whereby under that provision, because they have anti-dilution rights, they do not meet the criteria for equity treatment and must be recorded as a liability. Accordingly, the Company classifies the warrant instrument as a liability at its fair value and adjusts the instrument to fair value at each reporting period. The anti-dilution provisions expired on June 11, 2015 and accordingly the liability has been extinguished. The following table presents information about the Companys liabilities that are measured at fair value on a recurring basis (the Series A Warrants described above) as of September 30, 2014 and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value. In general, fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical liabilities. Fair values determined by Level 2 inputs utilize data points that are observable such as quoted prices, interest rates and yield curves. Fair values determined by Level 3 inputs are unobservable data points for the liability, and includes situations where there is little, if any, market activity for the liability:
The table below provides a reconciliation of the beginning and ending balances for the liabilities measured using fair significant unobservable inputs (Level 3):
The following assumptions were used in calculations of the Monte Carlo Simulation model for the year ended December 31, 2015 and 2014:
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Income Taxes |
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Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INCOME TAXES | Loss Before Taxes
Deferred Income Taxes The Company has incurred net operating losses since inception. The Company has not reflected any tax benefit related to such net operating losses in the financial statements. Prior to August 15, 2007 the Company was a limited liability company and losses were passed through to the individual members, therefore the Company only has potential tax benefits from the date it became a C corporation.
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company and its subsidiaries deferred tax assets at December 31, 2015 and December 31, 2014 are as follows:
In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income.
The authoritative guidance requires a valuation allowance to reduce the deferred tax assets reported if, based on the weight of the evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Based on the level of historical taxable losses and projections of future taxable income (losses) over the periods in which the deferred tax assets can be realized, management currently believes that it is more likely than not that the Company will not realize the benefits of these deductible differences. Accordingly, management has determined that a 100% valuation allowance is appropriate at December 31, 2015 and December 31, 2014.
Net Operating Loss Carry-Forwards As of December 31, 2015 and 2014, the Company had U.S. accumulated losses for tax purposes of approximately $16,000,000 and $13,800,000 respectively, which may be carried forward and offset against U.S. taxable income, and which expire during the tax years 2027 through 2032.
Federal tax laws impose significant restrictions on the utilization of net operating loss carry-forwards and in the event of a change in ownership of the Company, as defined by the Internal Revenue Code Section 382. The Companys net operating loss carry-forwards may be subject to the above limitations.
As of December 31, 2015 and 2014, the Company had German accumulated losses for tax purposes of approximately $688,000 and $740,000 respectively, which may be carried forward and offset against German taxable income subject to certain restrictions and limitations. Such carry-forwards are subject to certain restrictions and limitations in the event of changes in the NovaVision GmbHs ownership.
As of December 31, 2015 and 2014, the Company had UK accumulated losses for tax purposes of approximately $199,000 and $180,000 respectively, which may be carried forward and offset against UK taxable income subject to certain restrictions and limitations.
Tax Rates The applicable US income tax rate for the Company for both of the years ended December 31, 2015 and 2014 was 35%. Non-US subsidiaries are taxed according to the tax laws in their respective country of residence. The German applicable rate for both of the years ended December 31, 2015 and 2014 was 31.58%; the UK applicable rate for both the years ended December 31, 2015 and 2014 was 20%.
US income taxes and foreign withholding taxes were not provided for on undistributed earnings of the Companys foreign subsidiaries. The Company intends to reinvest these earnings indefinitely in its foreign subsidiaries. If these earnings were distributed to US in the form of dividends or otherwise, after the repayment of intercompany debt, the Company would be subject to additional US income taxes (subject to an adjustment for foreign tax credits) and foreign withholding taxes.
Uncertain Tax Position The Company has recorded no liability for income taxes associated with unrecognized tax benefits at the date of adoption and has not recorded any liability associated with unrecognized tax benefits during 2015 and 2014. Accordingly, the Company has not recorded any interest or penalty in regard to any unrecognized benefit. |
Commitments and Contingencies |
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Dec. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | Lease The Company leases approximately 10,000 sq. ft. located at 6401 Congress Ave., Suite 140, Boca Raton, FL 33487 from Catexor Limited Partnership for a gross rent of $14,260 plus sales tax per month. The term of the lease is 5 years and 6 months terminating July, 2017. The Companys subsidiaries in Germany and the UK occupy properties on short term lease agreements. Rent expense for the year ended December 31, 2015 and 2014 was $204,445 and $202,083 respectively
Potential German tax liability In June 2012 the Company's German subsidiary received a preliminary assessment for Magdeburg City trade tax of approximately 75,000 (approximately $94,000). This assessment is for the 2010 fiscal year and relates to the Company's acquisition of the assets of the former NovaVision, Inc. An initial assessment for corporate tax for the same period has been preliminarily reduced to zero. The Company has not accepted this trade tax assessment and is in discussion with the relevant tax authorities with a view to its reduction. The tax authorities have agreed to suspend the assessment pending the outcome of certain court hearings, and the Company has agreed to make limited monthly payments on account. To the extent that this assessment (either a higher or a reduced amount) is ultimately confirmed by the tax authorities, the Company believes it has a very strong claim against certain professional advisors which would offset the liability in full. Accordingly, the Company has made no provision for this liability years ended December 31 2015 and 2014 respectively, other than recording the monthly payments as an expense.
Potential China Patent Infringement The Company was made aware in 2012 that a competitor had been granted a patent for related technology, and appeared to be entering the market with products that infringe the Companys own issued patent. Following investigation, the Company initiated an invalidation of the competitors patent; in March 2014 the Patent Re-examination Board issued an Examination Decision invalidating all the claims of the competitors patent. The competitor appealed the decision, but the Company has contested the appeal. A final decision on the appeal is pending. The Company has, in the interim, also prepared to enforce its own patent against this competitor, however this competitor appears to have abandoned its product offering, making an enforcement action moot for the time being. The Company has also been made aware that a second competitor has filed a patent application for related technology and also may be producing a product that potentially infringes the Companys patent, and has filed documents with the State Intellectual Property Office opposing grant of the patent application. As a general rule the Company intends to take all necessary action to protect its patent portfolio. As with all patent infringement actions, there is some risk that the accused infringer will not be found to infringe the claims, and an additional risk that the accused infringer will successfully challenge the validity of the asserted claims. |
Consulting and Other Agreements |
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Dec. 31, 2015 | |
Consulting and Other Agreements [Abstract] | |
CONSULTING AND OTHER AGREEMENTS | The following agreements were entered into or remained in force during the year ended December 31, 2015:
Consulting Agreement with Fountainhead
Effective as of January 2, 2014, the Company and Fountainhead amended their Consulting Agreement to extend the term of the Consulting Agreement to January 2, 2015, such Agreement being automatically extended on the same terms unless terminated by either party. During fiscal year 2015, a monthly fee was payable to Fountainhead in the amount of $10,000 per month, payable $5,000 in cash and the remainder payable in Company Common Stock deliverable at the end of each fiscal quarter. Effective September 2015, Fountainhead agreed to receive all of the fees in Common Stock.
Investor Relations Agreements
In January 2015, as amended in May 2015, the Company entered into a twelve month agreement, subject to early termination, to provide financial advisory, strategic business planning and professional relations services, with Acorn Management Partners (Acorn). Under the terms of the Agreement, as amended in May and July 2015, Acorn received a total of $53,000 in cash and $50,000 in shares of Restricted Common Stock during the period. The Acorn Agreement was terminated in October 2015. In August 2015, the Company entered into a three month agreement to provide investor relations advisory and consulting services, with Liolios Group, Inc. (Liolios). Under the terms of the Liolios Agreement, Liolios received $15,000 in cash and $10,000 in Restricted Common Stock. The Liolios agreement was terminated at the end of the three month period. |
Related Party Transactions |
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Dec. 31, 2015 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | Peter Zachariou, director and David Cantor, director are investment managers of Fountainhead Capital Management which is a related party due to the size of its shareholding. Adrian Liddell, Chairman is a consultant for Fountainhead Capital Management. During 2015, in accordance with the terms the Consulting Agreement, the Company issued 49,819 shares of Common Stock (valued at $90,000) to Fountainhead. During 2015 Preferred D Stock, convertible into shares of Common Stock, was issued in respect of Preferred Dividends as follows: 11,691 shares of Preferred D Stock (valued at $116,915), convertible into 54,377 shares of Common Stock to Fountainhead; and 4,313 shares of Preferred D Stock (valued at $43,130), convertible into 20,060 shares of Common Stock to Peter Zachariou. There were no other related party transactions during the year ended December 31, 2015. |
Subsequent Events |
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Dec. 31, 2015 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | There are no material subsequent events. |
Significant Accounting Policies (Policies) |
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Accounting Policies [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Principles of Consolidation and Basis of Presentation | The consolidated financial statements include the accounts of Vycor Medical, Inc., and its wholly-owned subsidiaries, NovaVision, Inc. (a Delaware corporation), NovaVision GmbH (a German corporation) and Sight Science Limited (a UK corporation), both wholly owned subsidiaries of NovaVision, Inc. The Company is headquartered in Boca Raton, FL. All material inter-company accounts, transactions, and balances have been eliminated in consolidation. Certain reclassifications and format changes have been made to prior year amounts to conform to the current year presentation. |
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Revenue Recognition | Vycor Medical generates revenue from the sale of its surgical access system to hospitals and other medical professionals. Vycor Medical records revenue when a completed contract for the sale exists, the product is invoiced and shipped to the customer. Vycor Medical does not provide for product returns or warranty costs.
NovaVision generates revenues from various programs, therapy services and other sources such as license sales. Therapy services revenues represent fees from NovaVisions vision restoration therapy software, eye movement training software, diagnostic software, clinic set up and training fees, and the professional and support services associated with the therapy. NovaVision provides vision restoration therapy directly to patients. The typical vision restoration therapy consists of six modules, performed on average over 6 months in the U.S. and U.K. and 10 months in Germany. A patient contract comprises set-up fees and monthly therapy fees. Set-up fees are recognized at the outset of the contract and therapy revenue is recognized ratably over the therapy period. Patient therapy is restricted to being completed by a patient within a specified time frame. NovaVisions saccadic training software is generally completed within 2-4 weeks and revenue is therefore recognized fully at commencement.
Deferred revenue results from patients paying for the therapy in advance of receiving the therapy. |
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Cash and cash equivalents | The Company maintains cash balances at various financial institutions. Accounts at each institution are insured by the Federal Deposit Insurance Corporation up to $250,000. Cash balances may at times exceed the FDIC insured limits. Cash also includes a US investment account in a money market backed by government securities up to 105% of the account balance. The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. Included within cash are deposits paid by patients, held by the Company until the patient returns the VRT device or chinrest at the end of therapy. At December 31, 2015 and 2014 patient deposits amounted to $27,183 and $32,869, respectively, and are included in Other Current Liabilities. |
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Accounts Receivable and Allowance for Doubtful Accounts Receivable | We have a policy of reserving for uncollectible accounts based on our best estimate of the amount of probable credit losses in our existing accounts receivable. We extend credit to our customers based on an evaluation of their financial condition and other factors. We generally do not require collateral or other security to support accounts receivable. We perform ongoing credit evaluations of our customers and maintain an allowance for potential bad debts if required. We determine whether an allowance for doubtful accounts is required by evaluating specific accounts where information indicates the customers may have an inability to meet financial obligations. In these cases, we use assumptions and judgment, based on the best available facts and circumstances, to record a specific allowance for those customers against amounts due to reduce the receivable to the amount expected to be collected. These specific allowances are re-evaluated and adjusted as additional information is received. The amounts calculated are analyzed to determine the total amount of the allowance. We may also record a general allowance as necessary. Direct write-offs are taken in the period when we have exhausted our efforts to collect overdue and unpaid receivables or otherwise evaluate other circumstances that indicate that we should abandon such efforts. |
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Inventories |
Inventories are stated at the lower of cost determined using the weighted average cost method or market. Net realizable value is the estimated selling price, in the ordinary course of business, less estimated costs to complete and dispose of the product. If the Company identifies excess, obsolete or unsalable items, its inventories are written down to their realizable value in the period in which the impairment is first identified. The provision for inventory obsolescence for the years ended December 31, 2015 and 2014 was ,$29,923 and $17,200, respectively. Shipping and handling costs incurred for inventory purchases and product shipments are recorded in cost of sales in the Company's consolidated statements of operations. |
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Foreign Currency | The Euro is the local currency of the country in which NovaVision GmbH conducts its operations and is considered the functional currency of this entity; the GB Pound is the local currency of the country in which Sight Science Limited conducts its operations and is considered the functional currency of this entity. All balance sheet amounts are translated to U.S. dollars using the U.S. exchange rate at the balance sheet date except for the equity section which is translated at historical rates. Operating statement amounts are translated using an average exchange rate for the period of operations. Foreign currency translation effects are accumulated as part of the accumulated other comprehensive income (loss) and included in stockholders equity in the accompanying Consolidated Balance Sheet. |
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Educational marketing and advertising expenses | The Company may incur costs for the education of customers on the uses and benefits of its products. The Company will include education, marketing and advertising expense as a component of selling, general and administrative costs as such costs are incurred. |
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Income taxes | We use the asset and liability method of accounting for income taxes in accordance with ASC Topic 740, Income Taxes. Under this method, income tax expense is recognized for the amount of: (i) taxes payable or refundable for the current year and (ii) deferred tax consequences of temporary differences resulting from matters that have been recognized in an entitys financial statements or tax returns. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is provided to reduce the deferred tax assets reported if based on the weight of the available positive and negative evidence, it is more likely than not some portion or all of the deferred tax assets will not be realized.
ASC Topic 740.10.30 clarifies the accounting for uncertainty in income taxes recognized in an enterprises financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC Topic 740.10.40 provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. We have no material uncertain tax positions for any of the reporting periods presented. |
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Fixed assets | Fixed assets are stated at cost less accumulated depreciation. Depreciation is provided for on a straight-line basis over the useful lives of the assets. Expenditures for additions and improvements are capitalized; repairs and maintenance are expensed as incurred. |
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Derivative Liability | The Company has accounted for the 34,723 Series A Warrants issued in connection with the 2014 Offering (all as defined in Note 10), the holders of which had not waived their anti-dilution rights (as detailed further in Note 10) in accordance with the guidance contained in ASC 815-40-15-7D, whereby under that provision, because they had anti-dilution rights, they did not meet the criteria for equity treatment and must be recorded as a liability. Accordingly, the Company classified the warrant instrument as a liability at its fair value and adjusted the instrument to fair value at each reporting period. This liability was subject to re-measurement at each balance sheet date until exercised or until the anti-dilution provisions contained within the warrant agreements expired, and was classified in the balance sheet as a current liability. Any change in fair value of the warrant liability was recognized in the Companys statement of operations as other income (loss). The anti-dilution provisions expired on June 11, 2015 and accordingly the liability has been extinguished. |
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Impairment of long-lived assets | Long-lived assets are reviewed for impairment when circumstances indicate the carrying value of an asset may not be recoverable. For assets that are to be held and used, impairment is recognized when the estimated undiscounted cash flows associated with the asset or group of assets is less than their carrying value. If impairment exists, an adjustment is made to write the asset down to its fair value, and a loss is recorded as the difference between the carrying value and fair value. Fair values are determined based on quoted market values, discounted cash flows or internal and external appraisals, as applicable. Assets to be disposed of are carried at the lower of carrying value or estimated net realizable value. |
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Research and Development | The Company expenses all research and development costs as incurred. For the years ended December 31, 2015 and 2014, the amounts charged to research and development expenses were $71,512 and $69,114, respectively. |
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Software Development Costs | The Company accounts for software development costs in accordance with ASC 350-40, whereby all costs incurred during the preliminary stage of a development project should be charged to expense as incurred. Capitalization of costs begins after the preliminary stage has been completed, management commits to funding the project, it is probable that the project will be completed, and the software will be used for its intended function. All post-implementation costs are charged to expense as incurred. Accordingly, direct internal and external costs associated with the development of the features and functionality of the Companys software, incurred during the application development stage, are capitalized and amortized using the straight-line method of the estimated life of five years. The Company acquired internally developed software valued at $540,000 as part of the acquisition of the assets of NovaVision, Inc. on November 30, 2010 and $363,472 as part of the acquisition of the assets of Sight Science Limited on January 4, 2012. For the years ended December 31, 2015 and 2014, the amounts capitalized for software development were $32,843 and $124,660 respectively, for the Companys VRT 7.0 and NeuroEyeCoach programs. |
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Uses of estimates in the preparation of financial statements | The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimated. To the extent managements estimates prove to be incorrect, financial results for future periods may be adversely affected. Significant estimates and assumptions contained in the accompanying consolidated financial statements include managements estimate of the allowance for uncollectible accounts receivable, amortization of intangible assets, and the fair values of options and warrants included in the determination of debt discounts and share based compensation. |
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Stock Compensation | The Company recognizes the cost of all share-based payments under the relevant authoritative accounting guidance. Share-based payments include any remuneration paid by the Company in shares of the Companys common stock or financial instruments that grant the recipient the right to acquire shares of the Companys common stock. For share-based payments to employees, which consist only of awards made under the stock option plan described below, the Company accounts for the payments in accordance with the provisions of ASC Topic 718, Stock Compensation. Share-based payments to consultants, service providers and other non-employees are accounted for under in accordance with ASC Topic 718, ASC Topic 505, Equity Payments to Non-Employees or other applicable authoritative guidance. |
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Convertible Instruments | We evaluate and account for conversion options embedded in convertible instruments in accordance with ASC 815 Derivatives and Hedging Activities.
Applicable GAAP requires companies to bifurcate conversion options from their host instruments and account for them as free standing derivative financial instruments according to certain criteria. The criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under other GAAP with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument.
We account for convertible instruments (when we have determined that the embedded conversion options should not be bifurcated from their host instruments) as follows: We record when necessary, discounts to convertible notes for the intrinsic value of conversion options embedded in debt instruments based upon the differences between the fair value of the underlying common stock at the commitment date of the note transaction and the effective conversion price embedded in the note. Debt discounts under these arrangements are amortized over the term of the related debt to their stated date of redemption. The embedded conversion option in connection with our convertible debt could not be exercised unless and until we completed a Qualifying Financing transaction. Accordingly, we determined based on authoritative guidance that the embedded conversion option is deemed to be a contingent conversion rather than active conversion option that did not require accounting recognition at the commitment dates of the issuances of the Notes. |
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Common Stock Purchase Warrants and Other Derivative Financial Instruments | We classify as equity any contracts that require physical settlement or net-share settlement or provide us a choice of net-cash settlement or settlement in our own shares (physical settlement or net-share settlement) provided that such contracts are indexed to our own stock as defined in ASC 815-40 ("Contracts in Entity's Own Equity"). We classify as assets or liabilities any contracts that require net-cash settlement (including a requirement to net cash settle the contract if an event occurs and if that event is outside our control) or give the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement). We assess classification of our common stock purchase warrants and other free standing derivatives at each reporting date to determine whether a change in classification between assets and liabilities is required. |
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Fair Value Measurements | We adopted the provisions of ASC Topic 820, Fair Value Measurements and Disclosures, which defines fair value as used in numerous accounting pronouncements, establishes a framework for measuring fair value and expands disclosure of fair value measurements.
The estimated fair value of certain financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and accrued expenses are carried at historical cost basis, which approximates their fair values because of the short-term nature of these instruments. The carrying amounts of our short and long term credit obligations approximate fair value because the effective yields on these obligations, which include contractual interest rates taken together with other features such as concurrent issuances of warrants and/or embedded conversion options, are comparable to rates of returns for instruments of similar credit risk.
ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 describes three levels of inputs that may be used to measure fair value:
Level 1 quoted prices in active markets for identical assets or liabilities Level 2 quoted prices for similar assets and liabilities in active markets or inputs that are observable Level 3 inputs that are unobservable (for example cash flow modeling inputs based on assumptions) |
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Net Loss Per Share | Basic net loss per share is computed by dividing net loss by the weighted-average number of common shares outstanding during the period. Diluted net loss per share is computed giving effect to all dilutive potential common shares that were outstanding during the period. Dilutive potential common shares consist of incremental shares issuable upon exercise of stock options and warrants and conversion of preferred stock and convertible debt. Such potentially dilutive shares are excluded when the effect would be to reduce a net loss per share. No dilution adjustment has been made to the weighted average outstanding common shares in the periods presented because the assumed exercise of outstanding options and warrants and the conversion of preferred stock and debt would be anti-dilutive.
The following table sets forth the potential shares of common stock that are not included in the calculation of diluted net loss per share:
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Recent Accounting Pronouncements | From time to time new accounting pronouncements are issued by the Financial Accounting Standards Board or other standard setting bodies that may have an impact on the Companys accounting and reporting. The Company believes that such recently issued accounting pronouncements and other authoritative guidance for which the effective date is in the future will not have an impact on its accounting or reporting or that such impact will not be material to its financial position, results of operations and cash flows when implemented. |
Significant Accounting Policies (Tables) |
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Potential shares of common stock that are not included in the calculation of diluted net loss per share |
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Notes Payable (Tables) |
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Segment Reporting, Geographical Information (Tables) |
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Business segments information |
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Summary of geographic information |
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Fixed Assets (Tables) |
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Summary of fixed assets |
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Intangible Assets (Tables) |
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Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Intangible Assets |
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Equity (Tables) |
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Summary of outstanding rights, options and warrants |
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Share-Based Compensation (Tables) |
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Assumptions used in calculations of the Black-Scholes option pricing model for options and warrants |
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Fair Value Measurements (Tables) |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule liabilities measured at fair value on a recurring basis |
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Schedule of liabilities measured using fair significant unobservable inputs (Level 3) |
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Schedule of fair value assumptions used in calculation of the Monte Carlo Simulation model |
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Income Taxes (Tables) |
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Income Tax Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||
Summary of loss before taxes |
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Company effective tax rate on U.S statutory rate |
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Summary of deferred tax assets and valuation allowance |
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Significant Accounting Policies (Details Narrative) - EUR (€) |
12 Months Ended | |
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Dec. 31, 2015 |
Dec. 31, 2014 |
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Accounting Policies [Abstract] | ||
Patient deposits | € 27,183 | € 32,869 |
Inventory provision | 29,923 | 17,200 |
Research and development expenses | 71,512 | 69,114 |
Software development value | € 32,843 | € 124,660 |
Notes Payable (Details) - EUR (€) |
Dec. 31, 2015 |
Dec. 31, 2014 |
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Components of notes payable | ||
Total Other Notes Payable: | € 317,750 | € 321,786 |
Term Note [Member] | ||
Components of notes payable | ||
Total Other Notes Payable: | 300,000 | 300,000 |
Insurance Policy Finance Agreements [Member] | ||
Components of notes payable | ||
Total Other Notes Payable: | € 15,750 | € 21,786 |
Segment Reporting, Geographical Information (Details) - EUR (€) |
12 Months Ended | |
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Dec. 31, 2015 |
Dec. 31, 2014 |
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Revenue: | ||
Total Revenue | € 1,138,634 | € 1,250,292 |
Gross Profit: | ||
Total Gross Profit | 974,516 | 1,093,992 |
Total Assets: | ||
Total Assets | 2,022,731 | 3,813,743 |
Vycor Medical [Member] | ||
Revenue: | ||
Total Revenue | 885,481 | 357,264 |
Gross Profit: | ||
Total Gross Profit | 777,953 | 313,568 |
Total Assets: | ||
Total Assets | 872,441 | 2,644,513 |
Novavision [Member] | ||
Revenue: | ||
Total Revenue | 253,153 | 893,028 |
Gross Profit: | ||
Total Gross Profit | 196,563 | 780,424 |
Total Assets: | ||
Total Assets | € 1,157,790 | € 1,169,230 |
Segment Reporting, Geographical Information (Details 1) - EUR (€) |
12 Months Ended | |
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Dec. 31, 2015 |
Dec. 31, 2014 |
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Revenue: | ||
Total Revenue | € 1,138,634 | € 1,250,292 |
Gross Profit: | ||
Total Gross Profit | 974,516 | 1,093,992 |
Total Assets: | ||
Total Assets | 2,022,731 | 3,813,743 |
United States | ||
Revenue: | ||
Total Revenue | 985,868 | 216,258 |
Gross Profit: | ||
Total Gross Profit | 844,298 | 192,489 |
Total Assets: | ||
Total Assets | 323,142 | 3,367,679 |
Europe [Member] | ||
Revenue: | ||
Total Revenue | 152,766 | 1,034,034 |
Gross Profit: | ||
Total Gross Profit | 132,218 | 901,503 |
Total Assets: | ||
Total Assets | € 1,707,089 | € 446,064 |
Segment Reporting, Geographical Information (Details Narrative) |
12 Months Ended |
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Dec. 31, 2015
Segment
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Segment Reporting [Abstract] | |
Number of business segments | 2 |
Number of geographic segments | 2 |
Fixed Assets (Details Narrative) - EUR (€) |
12 Months Ended | |
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Dec. 31, 2015 |
Dec. 31, 2014 |
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Property, Plant and Equipment [Abstract] | ||
Depreciation expense | € 269,672 | € 254,608 |
Depreciation allocated to cost of sales | € 8,629 | € 14,383 |
Intangible Assets (Details) - EUR (€) |
Dec. 31, 2015 |
Dec. 31, 2014 |
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Indefinite-Lived Intangible Assets (Excluding Goodwill) | ||
Trademarks | € 251,157 | € 251,157 |
Patents [Member] | ||
Amortized intangible assets: | ||
Gross carrying Amount | 865,639 | 799,362 |
Accumulated Amortization | (542,501) | (454,249) |
Finite Lived Intangible Assets Net | 323,138 | 345,113 |
Website [Member] | ||
Amortized intangible assets: | ||
Gross carrying Amount | 50,760 | 32,750 |
Accumulated Amortization | (31,212) | (20,174) |
Finite Lived Intangible Assets Net | € 19,548 | € 12,576 |
Intangible Assets (Details Narrative) - EUR (€) |
12 Months Ended | |
---|---|---|
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Finite-Lived Intangible Assets [Line Items] | ||
Amortization of intangible assets | € 99,291 | € 128,381 |
Patents [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 8 years | |
Website [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 5 years |
Share-Based Compensation (Details) |
12 Months Ended |
---|---|
Dec. 31, 2015
EUR (€)
| |
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items] | |
Common stock issued value | € 249,492 |
Share-Based Compensation (Details 1) - $ / shares |
12 Months Ended | |
---|---|---|
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Options and warrants expensed | ||
Risk-free interest rates | 1.07% | 0.78% |
Expected life | 3 years | 3 years |
Expected dividends | 0.00% | 0.00% |
Expected volatility | 101.00% | 75.00% |
Vycor Common Stock fair value | $ 2.00 | $ 2.05 |
Fair Value Measurements (Details) - EUR (€) |
Dec. 31, 2015 |
Dec. 31, 2014 |
Dec. 31, 2013 |
---|---|---|---|
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | |||
Warrant Liability | € 0 | € 19,792 | |
Fair Value, Inputs, Level 1 [Member] | |||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | |||
Warrant Liability | 0 | 0 | |
Fair Value, Inputs, Level 2 [Member] | |||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | |||
Warrant Liability | 0 | 0 | |
Fair Value, Inputs, Level 3 [Member] | |||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | |||
Warrant Liability | € 0 | € 19,792 | € 0 |
Fair Value Measurements (Details 1) - EUR (€) |
12 Months Ended | |
---|---|---|
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Balance at beginning of period | € 19,792 | |
Balance at end of period | 0 | € 19,792 |
Fair Value, Inputs, Level 3 [Member] | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Balance at beginning of period | 19,792 | 0 |
Issuance of Series A Warrants and Placement Agent Warrants as part of Offering Units on January 2, January 31, February 24, February 28 and March 31, April 25, 2014 | 2,103,195 | |
Change in fair value during period | (19,792) | 252,633 |
Reclassification to equity from waiver of anti-dilution on May 15, 2014 | (2,336,036) | |
Balance at end of period | € 0 | € 19,792 |
Income Taxes (Details) - EUR (€) |
12 Months Ended | |
---|---|---|
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Income Tax Disclosure [Abstract] | ||
Domestic | € (1,706,722) | € (3,646,424) |
Foreign | (375,921) | (403,289) |
Loss Before Provision for Income Taxes | € (2,082,643) | € (4,049,713) |
Income Taxes (Details 1) - EUR (€) |
12 Months Ended | |
---|---|---|
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Income Tax Disclosure [Abstract] | ||
US statutory rate | € (728,925) | € (1,417,399) |
Tax difference between foreign and U.S. | 28,528 | 28,909 |
Change in Valuation Allowance | (700,397) | (1,388,490) |
Provision for income taxes | € 0 | € 0 |
Income Taxes (Details 2) - EUR (€) |
Dec. 31, 2015 |
Dec. 31, 2014 |
---|---|---|
Income Tax Disclosure [Abstract] | ||
Operating loss carry-forward | € 5,600,000 | € 4,800,000 |
Deferred tax asset before Valuation allowance | 5,600,000 | 4,800,000 |
Valuation allowance | (5,600,000) | (4,800,000) |
Net deferred tax asset | € 0 | € 0 |
Income Taxes (Details Narrative) - EUR (€) |
12 Months Ended | |
---|---|---|
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Income Taxes [Line Items] | ||
Income tax rate percent | 35.00% | 35.00% |
Accumulated losses on tax | € 16,000,000 | € 13,800,000 |
German [Member] | ||
Income Taxes [Line Items] | ||
Accumulated losses on tax | € 688,000 | € 740,000 |
German [Member] | Non-Guarantor Subsidiaries [Member] | ||
Income Taxes [Line Items] | ||
Income tax rate percent | 31.58% | 31.58% |
UNITED KINGDOM | ||
Income Taxes [Line Items] | ||
Accumulated losses on tax | € 199,000 | € 180,000 |
UNITED KINGDOM | Non-Guarantor Subsidiaries [Member] | ||
Income Taxes [Line Items] | ||
Income tax rate percent | 20.00% | 20.00% |
Commitments and Contingencies (Details) - EUR (€) |
12 Months Ended | |
---|---|---|
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Commitments and Contingencies Disclosure [Abstract] | ||
Rent expense | € 204,445 | € 202,083 |
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