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Series A Convertible Preferred Stock, Stockholders' Deficit, and Warrants (Tables)

9 Months Ended

Sep. 30, 2017

Equity [Abstract]

Schedule of Series A Preferred Stock Units Private Placement

		Series A
		Preferred
		Stock Units
		Issue Dates
		(Aggregate)
Series A Preferred Stock Units issuance gross proceeds		$	2,537,012
Less: Series A Warrants initial fair value⁽¹⁾			(4,050,706	)
Less: Series A Convertible Preferred Stock conversion option embedded derivative liability initial fair value⁽¹⁾			(1,221,963	)
Excess of initial fair value over gross proceeds			(2,735,657	)
Offering costs of the issuance of the Series A Preferred Stock Units			(388,628	)
Loss on issuance of Series A Preferred Stock Units		$	(3,124,285	)

⁽¹⁾

See Note 3, Financial Instruments Fair Value Measurements, for information with respect to the fair value of the Series A Convertible Preferred Stock embedded derivative liability and the Series A Warrants liability.

Schedule of Estimated Fair Values for Series A-1 Convertible Preferred Stock Warrants

		Issue
Series A-1 Convertible Preferred Stock		Date
Aggregate fair value		$	189,550
Required rate of return			27.0	%
Series A-1 Convertible Preferred Stock shares			125,000
Conversion ratio			1.0	x
Stated Value per share - conversion ratio numerator		$	4.00
Conversion price per share - conversion ratio denominator		$	4.00
Value of common stock		$	2.98
Expected term (years)			6.74
Volatility			52	%
Risk free rate			2.0	%
Dividend yield			0	%

		Issue
Series A-1 Convertible Preferred Stock		Date
Aggregate fair value		$	310,450
Series A-1 Warrants			125,000
Exercise price per share		$	6.00
Value of common stock		$	2.98
Expected term (years)			6.74
Volatility			52	%
Risk free rate			2.0	%
Dividend yield			0	%

Schedule of Outstanding Warrants to Purchase Common Stock

The following table summarizes outstanding warrants to purchase common stock at the dates indicated:

		Warrants Exercisable at
						Weighted								Weighted
						Average								Average
		September 30, 2017				Exercise Price /Share				December 31, 2016				Exercise Price				Expiration Date
Equity classified warrants
Series W Warrants			10,567,845			$	5.00				10,580,095			$	5.00				January 2022
Unit Purchase Options
Series W Warrants			53,000			$	5.00				53,000			$	5.00				January 2022
Series S Warrants			2,660,000			$	0.01				—			$	—				June 2032
Series A-1 Warrants			125,000			$	6.67				—			$	—				April 2024

Liability classified warrants
Series A Warrants			422,838			$	6.65				—			$	—				April 2024

Total			13,828,683			$	4.11				10,580,095			$	5.00

Tabular disclosure of warrants or rights issued. Warrants and rights outstanding are derivative securities that give the holder the right to purchase securities (usually equity) from the issuer at a specific price within a certain time frame. Warrants are often included in a new debt issue to entice investors by a higher return potential. The main difference between warrants and call options is that warrants are issued and guaranteed by the company, whereas options are exchange instruments and are not issued by the company. Also, the lifetime of a warrant is often measured in years, while the lifetime of a typical option is measured in months. Disclose the title of issue of securities called for by warrants and rights outstanding, the aggregate amount of securities called for by warrants and rights outstanding, the date from which the warrants or rights are exercisable, and the price at which the warrant or right is exercisable.

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