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Note 6 - Stockholders' Deficit | 12 Months Ended
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Dec. 31, 2015
Notes to Financial Statements |
Stockholders' Equity Note Disclosure [Text Block] | NOTE 6 STOCKHOLDERS’ DEFICIT Common Stock The Company adopted a certificate of amendment to the Company’s restated certificate of incorporation to increase the number of authorized shares of its $.001 par value common stock from 10,000,000 shares to 20,000,000 shares which was recorded by the state of Delaware on October 2, 2015. No common stock was issued during the years ended December 31, 2015 and 2014. Stock-Based Compensation On March 15, 2006, the Company adopted the “Protagenic Therapeutic, Inc. 2006 Employee, Director and Consultant Stock Plan” (the “Plan”) and authorized 140,000 shares for issuance pursuant to the Plan. On April 1, 2012, the Company increased the number of authorized shares to 2,000,000 shares. In accordance with the Plan, the Company can grant to certain employees, directors or consultants options to purchase shares of the Company’s common stock which vest automatically or ranging from a one-year period to a five-year period. The shares are exercisable over a period of ten years from the date of grant. The Plan provides that qualified options be granted at an exercise price equal to the fair market value at the date of grant, as determined by the Board of Directors. During the years ended December 31, 2015 and 2014, the Company granted a total of 490,000 and 240,000 respectively, options to purchase shares of the Company’s common stock at an exercise price of $1.25 and $1.00 per share. The 2015 and 2014 options vest monthly ranging from six months to over a five-year period for one individual. Management has determined that for each round of stock options granted, it was reasonable to estimate the fair value of the common stock options using the Black Scholes option pricing model. Accordingly, the Company has accounted for options using this calculated value method. Based on the fact that the Company is a privately held company with no revenue, management has estimated its expected future equity volatility factor in valuing the Company’s common stock equivalents by starting with its historical volatility adjusted for the volatility of equity interests from comparable publicly traded and privately held published companies to arrive at such industry benchmarks to evaluate. The fair value of each stock option granted and warrant issued during 2015 and 2014 was estimated using the Black Scholes assumptions and or factors as follows:
|  | 2015 |  | 2014 |
Expected dividend yield |  |  | 0% |  |  |  | 0 | %
Risk free interest rate |  | 1.66% | - | 2.43% |  |  | 2.30 | %
Expected life in years |  |  | 10 |  |  |  | 10 |
Expected volatility |  |  | 85% |  |  |  | 85 | %
No stock options expired or were forfeited during the years ended December 31, 2015 and 2014. As of December 31, 2015, the stock options had no intrinsic value as there was no current market value for the shares. The Company recognized stock-based compensation expense pertaining to the options granted of $190,751 and $85,168 during the years ended December 31, 2015 and 2014, respectively. Stock-Based Compensation (continued) As of December 31, 2015 and 2014, the Plan had remaining option shares to be granted of 292,256 and 782,256, respectively. Unrecognized compensation expense related to unvested awards as of December 31, 2015 was approximately $290,985, and will be recognized over the remaining vesting periods of the underlying awards. The following is an analysis of the stock option grant activity under the Plan:
|  |  |  |  |  | Exercise |  |  | Weighted Average |
|  | Number |  |  | Price |  |  | Exercise Price |
Stock Options |  |  |  |  |  |  |  |  |  |  |  |
Outstanding January 1, 2014 |  |  | 977,744 |  |  |  |  |  |  | $ | 0.60 |
Granted |  |  | 240,000 |  |  | $ | 1.00 |  |  |  |  |
Outstanding December, 31, 2014 |  |  | 1,217,744 |  |  |  |  |  |  | $ | 0.68 |
Granted |  |  | 490,000 |  |  | $ | 1.25 |  |  |  |  |
Outstanding December, 31, 2015 |  |  | 1,707,744 |  |  |  |  |  |  | $ | 0.84 |
The following is an analysis of the vested and non-vested stock options under the Plan as of December 31, 2015:
Number of Options | Expiration Date |  | Remaining Contractual Life (Years) |  |  | Exercise Price |
104,150 |  | March 1, 2016 |  |  | 0.17 |  |  | $ | 0.26 |
312,449 |  | March 15, 2016 |  |  | 0.21 |  |  | $ | 0.26 |
55,000 |  | August 1, 2016 |  |  | 0.59 |  |  | $ | 0.26 |
60,000 |  | November 1, 2016 |  |  | 0.84 |  |  | $ | 0.26 |
21,145 |  | February 1, 2017 |  |  | 1.09 |  |  | $ | 1.00 |
290,000 |  | March 1, 2021 |  |  | 5.25 |  |  | $ | 1.00 |
10,000 |  | June 10, 2021 |  |  | 5.45 |  |  | $ | 1.00 |
50,000 |  | April 1, 2022 |  |  | 6.25 |  |  | $ | 1.00 |
75,000 |  | December 1, 2022 |  |  | 6.92 |  |  | $ | 1.00 |
90,000 |  | March 1, 2024 |  |  | 8.17 |  |  | $ | 1.00 |
215,000 |  | March 1, 2025 |  |  | 9.17 |  |  | $ | 1.25 |
75,000 |  | March 9, 2025 |  |  | 9.19 |  |  | $ | 1.25 |
150,000 |  | March 1, 2027 |  |  | 11.17 |  |  | $ | 1.00 |
200,000 |  | January 22, 2030 |  |  | 14.07 |  |  | $ | 1.25 |
1,707,744 |  |  |  |  |  |  |  |  |  |
Warrants The Company has conducted private placement offerings to raise financing since its formation. In connection with the private placement offerings that occurred in 2013, 2011, and 2007, the Company offered its common stock at a fixed purchase price of $1.00 per share, $0.001 par value, and offered 3 warrants for each share purchased. The warrants have an exercise price of $1.00 per share and have an exercise term of ten years from the date of issuance. The Company has warrants outstanding as follows:
|  | December 31, 2015 |  |  | December 31, 2014 |
Financing and stock subscriptions (includes 300,000 warrants to the Major Stockholder and Chairman) |  |  | 2,100,000 |  |  |  | 2,100,000 |
Consultants |  |  | 350,000 |  |  |  | 100,000 |
Major Stockholder and Chairman |  |  | 953,367 |  |  |  | 953,367 |
Total Warrants Issued |  |  | 3,403,367 |  |  |  | 3,153,367 |
A summary of warrant issuances are as follows:
|  |  |  |  |  | Exercise |  |  | Weighted Average |
|  | Number |  |  | Price |  |  | Exercise Price |
Warrants |  |  |  |  |  |  |  |  |  |  |  |
Outstanding January 1, 2014 |  |  | 3,153,367 |  |  |  |  |  |  | $ | 1.01 |
Granted |  |  | - |  |  | $ | - |  |  |  |  |
Outstanding December, 31, 2014 |  |  | 3,153,367 |  |  |  |  |  |  | $ | 1.00 |
Granted |  |  | 250,000 |  |  | $ | 1.25 |  |  |  |  |
Outstanding December, 31, 2015 |  |  | 3,403,367 |  |  |  |  |  |  | $ | 1.05 |
All outstanding warrants are currently exercisable. A summary of warrants issued and outstanding at December 31, 2015 is summarized as follows:
Number of Common Stock Equivalents |  | Expiration Date |  | Remaining Contractual Life(Years) |  | Exercise Price |
100,000 |  | 01/01/2017 |  |  | 1.2 |  |  | $ | 1.25 |
675,000 |  | 07/07/2021 |  | 5.5 | to | 6.7 |  | $ | 1.00 |
2,628,367 |  | 12/20/2023 |  | 7.3 | to | 8.1 |  | $ | 1.05 |
3,403,367 |  |  |  |  |  |  |  |  |  |
Warrants (continued) The Company recognized stock-based compensation expense pertaining to the warrants issued of $287,878 and $0 during the years ended December 31, 2015 and 2014, respectively. As of December 31, 2015, the Major Stockholder and Chairman has been issued 1,253,367 warrants to purchase 417,789 shares of common stock at an exercise price of $1.00 exercisable over 10 year periods which ends either on May 19, 2021 (warrants to purchase 100,000 shares of common stock) or on February18, 2023 (warrants to purchase 317,789 shares of common stock).

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- Definition The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 310 -SubTopic 10 -Section S99 -Paragraph 4 -Subparagraph (SAB Topic 4.E) -URI http://asc.fasb.org/extlink&oid=27010918&loc=d3e74567-122707 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21484-112644 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02(29)) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21488-112644 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(e)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02(31)) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section S99 -Paragraph 4 -Subparagraph (SAB Topic 4.C) -URI http://asc.fasb.org/extlink&oid=27012166&loc=d3e187143-122770 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02(30)) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 6 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21506-112644 Reference 10: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(d)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.3-04) -URI http://asc.fasb.org/extlink&oid=27012166&loc=d3e187085-122770 Reference 12: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 30 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6405834&loc=d3e23285-112656 Reference 13: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644 Reference 14: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Glossary Preferred Stock -URI http://asc.fasb.org/extlink&oid=6521494 Reference 15: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21463-112644 Reference 16: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 11 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21564-112644 + Details
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