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5. Capital Stock | 9 Months Ended
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Sep. 30, 2014
Stockholders' Equity Note [Abstract] |
Stockholders' Equity Note Disclosure [Text Block] | 5. Capital Stock a) Authorized share capital 500,000,000 shares of common stock with a par value of $0.001 per share and 500,000,000 shares of preferred stock with a par value of $0.001 per share. b) Issued share capital On January 2, 2013, a consultant of the Company exercised their option to acquire 1,000,000 shares of common stock of the Company at an exercise price of $0.03 per share. As consideration, the Company recorded a reduction of $30,000 in accrued interest due and payable to a Director and Officer of the Company. On November 15, 2013, a consultant of the Company exercised their option to acquire 2,000,000 shares of common stock of the Company at an exercise price of $0.03 per share. As consideration, the Company recorded a reduction of $60,000 of accrued accounts payable to the consultant. On May 21, 2014, four consultants of the Company exercised their option to acquire 1,550,000 shares of common stock of the Company at an exercise price of $0.03 per share. As consideration, the Company retired accounts payable of $135,000 and received a full release of any additional claim to debt. b) Issued share capital On August 15, 2014, a director of the Company exercised their option to acquire 1,250,000 shares of common stock of the Company at an exercise price of $0.03 per share. As consideration, the Company retired accrued interest payable of $37,500. c) Stock options On January 1, 2013, the Company granted a consultant options to acquire 1,000,000 shares of its common stock at an exercise price of $0.03 per share for a term of five years. The stock based compensation expense recognized related to the grant of the options was $29,983. During the year ended December 31, 2013, these options were exercised in full. On January 28, 2013, the Company granted the option to acquire 2,300,000 shares of common stock of the Company that vest as follow:
- | 700,000 immediately
- | 50,000 per month for ten consecutive months, commencing January 31, 2013 for a total of 500,000
- | 200,000 on January 27, 2014
- | 200,000 on January 27, 2015
- | 200,000 in November 2014 subject to approval from the COO of the Company
- | 200,000 in December 2015 subject to approval from the COO of the Company
- | 300,000 subject to performance vesting criteria
The Company recognized compensation expense of $70,350 related to the options that vested during the year. The stock based compensation expense related to the unvested stock options to be recognized if the options vest is $21,585. On March 26, 2013, the Company granted a consultant the options to acquire 500,000 shares of its common stock at an exercise price of $0.03 per share for a term of five years. The option does not vest until the consultant enters into a full-time employment or equivalent role with the Company. Therefore, no compensation expense related to these options has been recognized. The stock based compensation expense related to the unvested stock options to be recognized if the options vest is $17,489. On April 1, 2013, the Company granted a consultant the option to acquire 1,250,000 shares of its common stock at an exercise price of $0.07 per share for a term of five years. The stock-based compensation expense related to the grant of this option was $43,706. On April 9, 2013, the Company granted two consultants each the respective and individual option to acquire 1,000,000 shares (500,000 shares each) of its common stock at an exercise price of $0.03 per share for a term of five years. The option does not vest for either consultant until the individuals enter into a full-time employment or equivalent role with the Company. Therefore, no compensation expense related to these options has been recognized. The stock based compensation expense related to the unvested stock options to be recognized if the options vest is $19,987. c) Stock options On May 1, 2013, the Company granted one consultant the option to acquire 2,000,000 shares of common stock of the Company at an exercise price of $0.03 per share for a period of five years. The stock based compensation expense recognized related to this option grant was $99,937. During the year ended December 31, 2013, these options were exercised in full. On October 1, 2013, the Company granted the option to acquire 500,000 shares of common stock at an exercise price of $0.03 per share to a consultant of the Company. The option to acquire the shares of common stock vests as follows:
- | 250,000 at the time of the grant, and
- | 250,000 one year from the date of grant
The compensation expense recognized related to this option grant was $14,929. The options are fully vested. On February 7, 2014 the Company,
a) | granted the option to acquire 300,000 shares of common stock at an exercise price of $0.03 per share to a consultant of the Company. The option to acquire the shares of common stock vest as follows:
- | 150,000 at the time of the grant, and
- | 150,000 one year from the date of grant
The compensation expense recognized related to this option grant was $6,932. The compensation expense related to the unvested stock options to be recognized if the options vest is $2,039.
b) | granted the option to acquire 400,000 shares of common stock at an exercise price of $0.03 per share to a consultant of the Company. The option to acquire the shares of common stock vest as follows:
- | 100,000 at the time of grant, and
- | Three respective performance conditions, each for the option to acquire 100,000 shares, with respect to sales and partnership arrangements.
The compensation expense recognized related to this option grant was $2,990. The compensation expense related to the unvested stock options to be recognized if the options vest is $8,970. On April 1, 2014,
a) | the Company agreed to the following in exchange for amending the borrowing limit on its line of credit with the Chairman, increasing it from $4,000,000 to $5,500,000:
i. | granted the option to acquire 83,333,400 shares of common stock of the Company at a price of $0.03 per share for a term of five years,
ii. | modified the exercise price of the options to acquire 35,750,000 shares of common stock of the Company, granted June 2012, from $0.05 per share to $0.03 per share,
iii. | modified the exercise price of the options to acquire 14,250,000 shares of common stock of the Company, granted December 2012, from $0.05 per share to $0.03 per share,
iv. | modified the exercise price of the options granted January 2011 to the spouse of the Chairman, to acquire 20,000,000 shares of common stock of the Company from $0.05 per share to $0.03 per share, and
v. | granted the option to the spouse of the Chairman to acquire 26,666,700 shares of common stock of the Company at an exercise price of $0.03 per share for a term of five years.
The compensation expense recognized related to the option grants was $3,280,929. There was no additional compensation expense recognized as a result of the modification to the exercise price of the previously granted options.
b) | the Company reduced the exercise price of 3,200,000 stock options from $0.05 per share to $0.03 per share. There was no additional compensation expense recognized as a result of the modification to the exercise price of these previously granted options. One individual, a director of the Company, has exercised their option to acquire 250,000 shares of common stock which were modified during 2014.
c) | the Company allowed 500,000 stock options, with an exercise price of $0.03 per share, to vest. The options were previously to vest if the optionee entered into a full-time employment or equivalent role with the Company. The compensation expense recognized related to this option grant was $19,987.
On April 18, 2014, the Company granted the following options:
a) | the option to acquire 1,500,000 shares of common stock at a price of $0.03 per share for a term of five years to a Director of the Company. The options vested on May 19, 2014 when the individual assumed the role as President of the Company. The compensation expense recognized related to the option grant was $37,263.
b) | the option to acquire 500,000 shares of common stock at a price of $0.03 per share for a term of five years to a consultant of the Company. Options vest as follow:
· | 100,000 shares vest immediately
· | 400,000 shares vest upon the completion of a partnership with a specified major multinational pharmaceutical company,
The compensation expense recognized related to this option grant was $2,484. The compensation expense related to the unvested stock options to be recognized if the options vest is $9,937. On May 21, 2014, the Company:
a) | granted a consultant the option to acquire 500,000 shares of common stock at a price of $0.03 per share for a term of five years. Options vest as follow:
· | 100,000 shares vest twelve months from the date of the grant
· | 200,000 shares vest twenty four months from the date of the grant
· | 200,000 shares vest thirty six months from the date of the grant
The compensation expense recognized related to this option grant was $3,135. The compensation expense related to the unvested stock options to be recognized if the options vest is $11,604.
b) | granted a consultant the option to acquire 100,000 shares of common stock at a price of $0.03 per share until June 27, 2017. This option to acquire 100,000 shares of common stock was exercised as part of a debt settlement agreement. The compensation expense recognized related to this option grant was $2,906.
c) | entered into agreements with three consultants to modify the exercise price of their collective options to acquire 1,450,000 shares of common stock from $0.07 to $0.03. The options to acquire 1,450,000 shares of common stock was exercised as part of a debt settlement agreement. There was no additional compensation expense recognized related to this option modification.
On July 25, 2014, the Company granted two directors each the option to acquire 1,000,000 shares of common stock at a price of $0.03 per share for a term of five years. One of the directors exercised their option acquire 1,000,000 shares of common stock of the Company. The compensation expense related to the option grants was $49,590. On August 1, 2014, the Company:
· | granted a director the option to acquire 500,000 shares of common stock at a price of $0.03 per share for a term of five years The compensation expense recognized was $12,393.
· | granted a consultant the option to acquire 250,000 shares of common stock at a price of $0.03 per share for a term of five years. The compensation expense was $6,196.
· | granted a consultant the option to acquire 500,000 shares of common stock at a price of $0.03 per share for a term of five years subject to:
i. | Consenting to act as an advisor to the Board of Directors of the Company;
ii. | Satisfactory completion, at the sole discretion of the Board of Directors, of a six month term as an advisor to the Board of Directors
iii. | Completion of an on-going arrangement with the Company in a material capacity immediately subsequent to the completion of the six month term referenced above in ii.
The compensation expense recognized related to the option grant was $12,393. On August 26, 2014, the Company granted a creditor of the Company the option to acquire 2,000,000 shares of common stock of the Company at a price of $0.05 per share for a term of five years. The options vest on the basis of 20 options for each dollar advanced to the Company to fund a public relations campaign. As at September 30, 2014, the option to acquire 300,000 shares of common stock had vested. The compensation expense recognized related to this option grant was $9,248. The compensation expense related to the unvested stock options to be recognized if the options vest is $52,404. A summary of stock option activity is as follows:
|  | Nine Months Ended |  |  | Year Ended |
|  | September 30, 2014 (unaudited) |  |  | December 31, 2013 |
|  | Number of |  |  | Weighted Average |  |  | Number of |  |  | Weighted Average |
|  | Options |  |  | Exercise Price |  |  | Options |  |  | Exercise Price |
Outstanding, beginning of period |  |  | 130,550,000 |  |  | $ | 0.03 |  |  |  | 125,000,000 |  |  | $ | 0.04 |
Granted |  |  | 118,550,100 |  |  |  | 0.03 |  |  |  | 8,550,000 |  |  |  | 0.04 |
Exercised |  |  | (2,800,000 | ) |  |  | 0.03 |  |  |  | (3,000,000 | ) |  |  | 0.03 |
Cancelled |  |  | (100,000 | ) |  |  | 0.07 |  |  |  | - |  |  |  | - |
Outstanding, end of period |  |  | 246,200,100 |  |  | $ | 0.03 |  |  |  | 130,550,000 |  |  | $ | 0.04 |
Exercisable, end of period |  |  | 241,150,100 |  |  | $ | 0.03 |  |  |  | 127,800,000 |  |  | $ | 0.04 |
|  | September 30, 2014 |  |  | December 31, 2013 |  |  |  |
Expiry Date |  | Options |  |  | Exercise Price |  |  | Intrinsic Value |  |  | Options |  |  | Exercise Price |  |  | Intrinsic Value |
March 7, 2015 |  |  | 20,000,000 |  |  | $ | 0.03 |  |  |  | - |  |  |  | 20,000,000 |  |  | $ | 0.05 |  |  |  | - |
June 30, 2015 |  |  | 1,200,000 |  |  | $ | 0.25 |  |  |  | - |  |  |  | 1,200,000 |  |  | $ | 0.25 |  |  |  | - |
March 6, 2016 |  |  | 35,750,000 |  |  | $ | 0.03 |  |  |  | - |  |  |  | 35,750,000 |  |  | $ | 0.05 |  |  |  | - |
May 4, 2016 |  |  | 1,000,000 |  |  | $ | 0.05 |  |  |  | - |  |  |  | 1,000,000 |  |  | $ | 0.05 |  |  |  | - |
May 23, 2016 |  |  | 100,000 |  |  | $ | 0.03 |  |  |  | - |  |  |  | 100,000 |  |  | $ | 0.05 |  |  |  | - |
May 27, 2017 |  |  | 400,000 |  |  | $ | 0.03 |  |  |  | - |  |  |  | 700,000 |  |  | $ | 0.05 |  |  |  | - |
May 31, 2017 |  |  | 500,000 |  |  | $ | 0.25 |  |  |  | - |  |  |  | 500,000 |  |  | $ | 0.05 |  |  |  | - |
August 16, 2017 |  |  | 250,000 |  |  | $ | 0.03 |  |  |  | - |  |  |  | 500,000 |  |  | $ | 0.05 |  |  |  | - |
December 28, 2017 |  |  | 14,250,000 |  |  | $ | 0.03 |  |  |  | - |  |  |  | 14,250,000 |  |  | $ | 0.05 |  |  |  | - |
December 28, 2017 |  |  | 51,000,000 |  |  | $ | 0.03 |  |  |  | - |  |  |  | 51,000,000 |  |  | $ | 0.03 |  |  |  | - |
January 28, 2018 |  |  | 2,300,000 |  |  | $ | 0.03 |  |  |  | - |  |  |  | 2,300,000 |  |  | $ | 0.05 |  |  |  | - |
March 26, 2018 |  |  | 500,000 |  |  | $ | 0.03 |  |  |  | - |  |  |  | 500,000 |  |  | $ | 0.03 |  |  |  | - |
April 1, 2018 |  |  | - |  |  | $ | - |  |  |  | - |  |  |  | 1,250,000 |  |  | $ | 0.07 |  |  |  | - |
April 9, 2018 |  |  | 1,000,000 |  |  | $ | 0.03 |  |  |  | - |  |  |  | 1,000,000 |  |  | $ | 0.03 |  |  |  | - |
October 1, 2018 |  |  | 500,000 |  |  | $ | 0.03 |  |  |  | - |  |  |  | 500,000 |  |  | $ | 0.03 |  |  |  | - |
February 7, 2019 |  |  | 700,000 |  |  | $ | 0.03 |  |  |  | - |  |  |  | - |  |  | $ | - |  |  |  | - |
April 1, 2019 |  |  | 110,000,100 |  |  | $ | 0.03 |  |  |  | - |  |  |  | - |  |  | $ | - |  |  |  | - |
April 18, 2019 |  |  | 2,000,000 |  |  | $ | 0.03 |  |  |  |  |  |  |  | - |  |  | $ | - |  |  |  |  |
May 21, 2019 |  |  | 500,000 |  |  | $ | 0.03 |  |  |  | - |  |  |  | - |  |  | $ | - |  |  |  | - |
July 25, 2019 |  |  | 1,000,000 |  |  | $ | 0.03 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
August 1, 2019 |  |  | 1,250,000 |  |  | $ | 0.03 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
August 26, 2019 |  |  | 2,000,000 |  |  | $ | 0.05 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total |  |  | 246,200,100 |  |  | $ | 0.03 |  |  |  | - |  |  |  | 130,550,000 |  |  | $ | 0.04 |  |  |  | - |
Weighted Average Remaining Contractual Life |  |  | 3.34 |  |  |  |  |  |  |  |  |  |  |  | 3.03 |  |  |  |  |  |  |  |  |
The Company uses the fair value method for determining stock-based compensation for all options granted during the fiscal periods. The fair value was determined using the Black-Scholes Option Pricing Model based on the following weighted average assumptions:
|  | September 30, 2014 (unaudited) |  |  | December 31, 2013 |
Risk-free interest rate |  |  | 2.50 | % |  |  | 2.52 | %
Expected life |  | 5 years |  |  | 5 Years |
Expected dividends |  |  | 0 | % |  |  | 0 | %
Expected volatility |  |  | 245 | % |  |  | 299 | %
Forfeiture rate |  |  | 0 | % |  |  | 0 | %
The weighted average fair value for the options granted during the nine months ended September 30, 2014 was $0.03 (2013: $0.03). The compensation cost of the stock options granted was allocated as follows:
|  | Three months ended September 30, 2014 (unaudited) |  |  | Three months ended September 30, 2013 (unaudited) |  |  | Nine months ended September 30, 2014 (unaudited) |  |  | Nine months ended September 30, 2013 (unaudited) |
Interest expense: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Related parties |  | $ | 9,248 |  |  | $ | - |  |  | $ | 3,296,342 |  |  | $ | - |
Product development fees |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Unrelated parties |  | $ | 1,699 |  |  | $ | 1,499 |  |  | $ | 17,847 |  |  | $ | 4,497 |
Professional fees: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Unrelated parties |  | $ | 11,152 |  |  | $ | - |  |  | $ | 44,610 |  |  | $ | 111,928 |
General and administrative: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Related Parties |  |  | 49,590 |  |  |  | - |  |  |  | 86,852 |  |  |  |  |
Unrelated parties |  | $ | 14,382 |  |  | $ | 5,996 |  |  | $ | 18,193 |  |  | $ | 63,959 |
|  | $ | 86,070 |  |  | $ | 7,495 |  |  | $ | 3,463,844 |  |  | $ | 180,384 |

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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 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(d),(e)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 Reference 2: 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 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.29-31) -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 310 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB TOPIC 4.E) -URI http://asc.fasb.org/extlink&oid=27010918&loc=d3e74512-122707 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Staff Accounting Bulletin (SAB) -Number Topic 4 -Section C Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Staff Accounting Bulletin (SAB) -Number Topic 4 -Section E Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 08 -Article 4 Reference 8: 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 9: 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 10: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 02 -Paragraph 29, 30, 31 -Article 5 Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 04 -Article 3 Reference 12: 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 13: 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 14: 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 15: 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 Reference 16: 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 17: 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 18: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 08 -Paragraph d -Article 4 Reference 19: 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 + Details
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