Annual report pursuant to Section 13 and 15(d)

Equity

v3.7.0.1
Equity
 12 Months Ended
Dec. 31, 2016
Equity [Abstract]  
Equity

Note 14 - Equity

 

    The holders of common shares are entitled to one vote per share at meetings of the Company. Holders of Series A convertible preferred shares are entitled to five votes per share at meetings of the Company.
     
    A restricted stock award is an award of common shares that are subject to certain restrictions during a specified period. Restricted stock awards are independent of option grants and are generally subject to forfeiture if employment terminates prior to the release of the restrictions. The grantee cannot transfer the shares before the restricted shares vest. Shares on non-vested restricted stock have the same voting rights as common stock, are entitled to receive dividends and other distributions thereon and are considered to be currently issued and outstanding. The Company’s restricted stock awards vest of a period of one to three years. The Company expenses the cost of the restricted stock awards, which is determined to be the fair market value of the shares at the date of grant, straight-line over the period during which the restrictions lapse. For these purposes, the fair market value of the restricted stock is determined based on the closing price of the Company’s common stock on the grant date.
     
    On January 9, 2015, the Company issued 190,000 common shares to directors for services provided to the Company through December 31, 2014. The fair value of these shares was $697,300, which was reported as administrative expenses on the Consolidated Statement of Operations and Comprehensive Loss for the year ended December 31, 2014, and the corresponding liability is included in trade and other payables on the December 31, 2014 Consolidated Balance Sheet.
     
    On December 29, 2015, the Company issued 227,708 common shares to directors and officers for services rendered to the Company through December 31, 2015. The fair value of these shares was $280,081, which was reported as administrative expenses on the Consolidated Statement of Operations and Comprehensive Loss for the year ended December 31, 2015.
     
    On December 29, 2015, the Company issued 22,500 common shares to key employees for services rendered to the Company through December 31, 2015. The fair value of these shares was $27,675, which was reported as research and development expenses on the Consolidated Statement of Operations and Comprehensive Loss for the year ended December 31, 2015.
     
    On December 29, 2015, the Company issued 30,000 common shares in exchange for legal services rendered. The fair value of these shares was $36,900, which was reported as administrative expenses on the Consolidated Statement of Operations and Comprehensive Loss for the year ended December 31, 2015.
     
    On June 8, 2016, the Company issued 27,500 restricted common shares to an officer in connection with his employment agreement. These shares vest 1/3 immediately on the date of the grant and the remaining 2/3 vests equally on March 1, 2017 and March 1, 2018. The fair value of these shares was $54,725 and was based on the share price on the date of the grant. $30,153 was recorded during the year December 31, 2016 as administrative expense on the Consolidated Statement of Operations and Comprehensive Loss and the remaining $24,572 was recorded as deferred compensation, a contra equity account, on the Consolidated Balance Sheet as of December 31, 2016.
     
    The following is a reconcilement of the movement of shares of Series A Convertible Preferred stock (“preferred stock”) and common stock:

 

      Authorized     Issued  
      Preferred     Common     Preferred     Common  
      Stock     Stock     Stock     Stock  
Balance at December 31, 2014       50,000,000       500,000,000       -       4,954,837  
                                   
Shares Issued:                                  
January 9, 2015       -       -       -       190,000  
December 29, 2015       -       -       -       280,208  
Balance at December 31, 2015       50,000,000       500,000,000       -       5,425,045  
                                   
Shares Issued:                                  
June 8, 2016       -       -       -       27,500  
Balance at December 31, 2016       50,000,000       500,000,000       -       5,452,545