Note 13 - Stockholders' (Deficit)

9 Months Ended

Sep. 30, 2014

Stockholders' Equity Note [Abstract]

Stockholders' Equity Note Disclosure [Text Block]

NOTE 13: STOCKHOLDERS’ (DEFICIT)

Our authorized capital stock consists of 250,000,000 shares of common stock, $.001 par value per share, and 10,000,000 shares of preferred stock, par value $.001 per share, of which 5,000,000 shares have been designated as 5% Series A Preferred Stock, 230,000 shares have been designated as Series B Preferred Stock, 747,500 shares have been designated as Series C Preferred Stock and 250,000 shares have been designated as Series D Preferred Stock.

As of September 30, 2014 we had the following outstanding securities:

o 91,504,659 shares of common stock issued and outstanding;

o 48,463,517 warrants issued and outstanding to purchase shares of our common stock;

o 4,125,224 shares of our Series A Preferred Stock issued and outstanding;

o -0- shares of our Series B Preferred Stock issued and outstanding;

o -0- shares of our Series C Preferred Stock issued and outstanding; 

o 250,000 share of our Series D Preferred Stock issued and outstanding; and

o $9,665,000 principal amount Convertible Debentures convertible into 24,620,000 shares of common stock.

Common Stock

Holders of common stock are entitled to one vote for each share on all matters submitted to a stockholder vote. Holders of our voting securities do not have cumulative voting rights. Holders of common stock are entitled to share in all dividends that the Board of Directors, in its discretion, declares from legally available funds. In the event of our liquidation, dissolution or winding up, subject to the preferences of the Series A Preferred Stockholders, each outstanding share of common stock entitles its holder to participate in all assets that remain after payment of liabilities and after providing for each class of stock, if any, having preference over the common stock.

Holders of common stock have no conversion, preemptive or other subscription rights, and there are no redemption provisions for the common stock. The rights of the holders of common stock are subject to any rights that may be fixed for holders of preferred stock, when and if any preferred stock is outstanding. All outstanding shares of common stock are duly authorized, validly issued, fully paid and non-assessable.

On July31, 2014, we issued 1,400,000 restricted shares of our common stock to our senior management team and our Board of Directors under the 2009 Equity Incentive Plan of OmniComm Systems, Inc. (the “2009 Plan”). The restrictions on the shares lapse ratably over a 3 year period. The 2009 Plan is more fully described in “Note 14, Employee Equity Incentive Plans”.

Preferred Stock

Our Board of Directors, without further stockholder approval, may issue preferred stock in one or more series from time to time and fix or alter the designations, relative rights, priorities, preferences, qualifications, limitations and restrictions of the shares of each series. In addition, the Board of Directors may fix and determine all privileges and rights of the authorized preferred stock series including:

o  dividend and liquidation preferences;

o voting rights;

o conversion privileges; and 

o redemption terms. 

Our Board of Directors may authorize the issuance of preferred stock which ranks senior to our common stock for the payment of dividends and the distribution of assets on liquidation. In addition, our Board of Directors can fix limitations and restrictions, if any, upon the payment of dividends on our common stock to be effective while any shares of preferred stock are outstanding.

The following table presents the cumulative arrearage of undeclared dividends by class of preferred stock as of September 30, 2014 and September 30, 2013, respectively, and the per share amount by class of preferred stock.

	Cumulative arrearage as of				Cumulative arrearage per share
	September 30,				as of September 30,
Series of preferred stock	2014		2013		2014		2013
Series A	$	2,534,711	$	2,328,450	$	0.61	$	0.56
Series B		609,887		609,887	$	3.05	$	3.05
Series C		1,472,093		1,472,093	$	4.37	$	4.37
Total preferred stock arrearage	$	4,616,691	$	4,410,430

The following table presents preferred dividends accreted for the nine month periods ended September 30, 2014 and September 30, 2013, respectively, and the per share effect of the preferred dividends if their effect was not anti-dilutive.

	Dividends accreted				Dividends per share
	nine months ended September 30,				nine months ended September 30,
	2014		2013		2014		2013
Preferred stock dividends in arrears Series A	$	154,272	$	154,272	$	0.037	$	0.037
Preferred stock dividends in arrears Series B	$	-0-	$	-0-	$	-0-	$	-0-
Preferred stock dividends in arrears Series C	$	-0-	$	-0-	$	-0-	$	-0-

Warrants Issued for Services and in Capital Transactions

The following tables summarize all outstanding warrants for the periods ended September 30, 2014 and December 31, 2013, and the related changes during these periods.

September 30, 2014 warrants outstanding

September 30, 2014 warrants exercisable

Range of

Number outstanding at

Weighted average

Weighted average

Number exercisable at

Weighted average

exercise price

September 30, 2014

remaining contractual life

exercise price

September 30, 2014

exercise price

$0.25

–

$0.60

48,463,517

1.41

$

0.35

48,463,517

$

0.35

December 31, 2013 warrants outstanding

December 31, 2013 warrants exercisable

Range of

Number outstanding at

Weighted average

Weighted average

Number exercisable at

Weighted average

exercise price

December 31, 2013

remaining contractual life

exercise price

December 31, 2013

exercise price

$0.25

–

$0.60

44,728,873

2.05

$

0.36

44,728,873

$

0.36

Warrants
Balance at December 31, 2013		44,728,873
Issued		3,920,000
Exercised		-0-
Expired/forfeited		(185,356	)
Balance at September 30, 2014		48,463,517
Warrants exercisable at September 30, 2014		48,463,517
Weighted average fair value of warrants granted during 2014	$	0.15

Other Comprehensive (Loss)

Due to the availability of net operating losses and related deferred tax valuations, there is no tax effect associated with any component of other comprehensive (loss). The following table lists the beginning balance, quarterly activity and ending balance of the components of accumulated other comprehensive (loss).

	Foreign currency			Accumulated other
	translation			comprehensive (loss)
Balance at December 31, 2012	$	(69,092	)	$	(69,092	)
2013 Activity		(18,512	)		(18,512	)
Balance at December 31, 2013		(87,604	)		(87,604	)
2014 Activity		(110,839	)		(110,839	)
Balance at September 30, 2014	$	(198,443	)	$	(198,443	)