UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_____________________

 

FORM 10-Q

____________________


(Mark One)


þ

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended March 31, 2014

 

OR

 

¨

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from _____________to _____________


Commission File Number 0-52567


Lightwave Logic, Inc.

(Exact name of registrant as specified in its charter)


Nevada

(State or other jurisdiction of

Incorporation or Organization)

82-049-7368

 (I.R.S. Employer Identification No.)

 

1831 Lefthand Circle, Suite C

Longmont, CO

(Address of principal executive offices)

80501

(Zip Code)

 

( 720) 340-4949

(Registrant’s telephone number, including area code)

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  þ   No  ¨


Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Date File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).Yes  þ   No  ¨


Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company.  See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act (Check one):


Large accelerated filer

¨

Accelerated filer

¨

Non-accelerated filer

¨

Smaller reporting company

þ


Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act.) Yes  ¨    No  þ


The number of shares of the registrant’s Common Stock outstanding as of May 14, 2014 was 53,080,469.




 

TABLE OF CONTENTS

 


  

  

Page

  

  

  

Part I

Financial Information

 

  

  

  

 

  

Item 1

Financial Statements

1

  

  

  

  

  

Item 2

Management’s Discussion and Analysis of Financial Condition and Results of Operations

22

  

  

  

 

  

Item 4

Controls and Procedures

29

  

  

  

 

Part II

Other Information

 

  

  

  

 

  

Item 2

Unregistered Sales of Equity Securities and Use of Proceeds

30

  

  

  

 

 

Item 5

Other Information

30

 

 

 

 

  

Item 6

Exhibits

30

  

  

  

 

  

  

Signatures

31



  



i



 

Forward-Looking Statements


This report on Form 10-Q contains forward-looking statements. Forward-looking statements involve risks and uncertainties, such as statements about our plans, objectives, expectations, assumptions or future events. In some cases, you can identify forward-looking statements by terminology such as “anticipate,” “estimate,” “plan,” “project,” “continuing,” “ongoing,” “expect,” “we believe,” “we intend,” “may,” “should,” “will,” “could” and similar expressions denoting uncertainty or an action that may, will or is expected to occur in the future. These statements involve estimates, assumptions, known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from any future results, performances or achievements expressed or implied by the forward-looking statements. You should not place undue reliance on these forward-looking statements.


Factors that that are known to us that could cause a different result than projected by the forward-looking statement, include, but are not limited to: lack of available funding; general economic and business conditions; competition from third parties; intellectual property rights of third parties; regulatory constraints; changes in technology and methods of marketing; delays in completing various engineering and manufacturing programs; changes in customer order patterns; changes in product mix; success in technological advances and delivering technological innovations; shortages in components; production delays due to performance quality issues with outsourced components; those events and factors described by us in Item 1.A “Risk Factors” in our most recent Annual Report on Form 10-K; other risks to which our Company is subject; other factors beyond the Company's control.


Any forward-looking statement made by us in this report on Form 10-Q is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.




ii



PART I – FINANCIAL INFORMATION


Item 1

Financial Statements


LIGHTWAVE LOGIC, INC.

(A Development Stage Company)


FINANCIAL STATEMENTS


MARCH 31, 2014


(UNAUDITED)


 

 

Page

 

 

 

Balance Sheets

 

2

 

 

 

Statements of Operations

 

3

 

 

 

Statement of Stockholders’ Equity

 

4

 

 

 

Statements of Cash Flow

 

12

 

 

 

Notes to Financial Statements

 

14









1




LIGHTWAVE LOGIC, INC.

(A Development Stage Company)

BALANCE SHEETS


 

 

March 31,

2014

 

 

December 31,

2013

 

 

 

(Unaudited)

 

 

(Audited)

 

ASSETS

  

                       

  

  

                       

  

CURRENT ASSETS

 

 

 

 

 

 

Cash and cash equivalents

 

$

1,930,097

 

 

$

2,270,704

 

Prepaid expenses and other current assets

 

 

112,850

 

 

 

132,204

 

  

 

 

2,042,947

 

 

 

2,402,908

 

  

 

 

 

 

 

 

 

 

PROPERTY AND EQUIPMENT - NET

 

 

326,210

 

 

 

298,360

 

  

 

 

 

 

 

 

 

 

OTHER ASSETS

 

 

 

 

 

 

 

 

Intangible assets - net

 

 

568,573

 

 

 

543,540

 

  

 

 

 

 

 

 

 

 

TOTAL ASSETS

 

$

2,937,730

 

 

$

3,244,808

 

  

 

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

 

 

 

 

Accounts payable

 

$

195,416

 

 

$

65,410

 

Accounts payable and accrued expenses- related parties

 

 

67,052

 

 

 

48,817

 

Accrued expenses

 

 

50,169

 

 

 

7,949

 

  

 

 

 

 

 

 

 

 

 TOTAL LIABILITIES

 

 

312,637

 

 

 

122,176

 

  

 

 

 

 

 

 

 

 

STOCKHOLDERS' EQUITY

 

 

 

 

 

 

 

 

Preferred stock, $0.001 par value, 1,000,000 authorized, no shares issued or outstanding

 

 

-

 

 

 

-

 

Common stock $0.001 par value, 100,000,000 authorized 53,080,469 and 52,617,789 issued and outstanding at March 31, 2014 and December 31, 2013

 

 

53,081

 

 

 

52,618

 

Additional paid-in-capital

 

 

35,904,055

 

 

 

35,414,206

 

Accumulated deficit

 

 

(15,827

)

 

 

(15,827

)

Deficit accumulated during development stage

 

 

(33,316,216

)

 

 

(32,328,365

)

  

 

 

 

 

 

 

 

 

TOTAL STOCKHOLDERS' EQUITY

 

 

2,625,093

 

 

 

3,122,632

 

  

 

 

 

 

 

 

 

 

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

 

$

2,937,730

 

 

$

3,244,808

 


See accompanying notes to these financial statements.




2





LIGHTWAVE LOGIC, INC.

(A Development Stage Company)

STATEMENTS OF OPERATIONS

FOR THE THREE MONTHS ENDING MARCH 31, 2014 AND 2013 AND FOR THE PERIOD

JANUARY 1, 2004 (INCEPTION OF DEVELOPMENT STAGE) TO MARCH 31, 2014

(UNAUDITED)


 

 

Cumulative

 

 

For the Three Months Ending

 

  

 

Since

 

 

March 31,

 

  

 

Inception

 

 

2014

 

 

2013

 

  

  

                       

  

  

                       

  

  

                       

  

  

 

 

 

 

 

 

 

 

 

NET SALES

 

$

5,700

 

 

$

2,500

 

 

$

-

 

  

 

 

 

 

 

 

 

 

 

 

 

 

COST AND EXPENSE

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

15,807,744

 

 

 

585,506

 

 

 

455,382

 

General and administrative

 

 

16,956,119

 

 

 

402,165

 

 

 

447,618

 

 

 

 

32,763,863

 

 

 

987,671

 

 

 

903,000

 

  

 

 

 

 

 

 

 

 

 

 

 

 

LOSS FROM OPERATIONS

 

 

(32,758,163

)

 

 

(985,171

)

 

 

(903,000

)

  

 

 

 

 

 

 

 

 

 

 

 

 

OTHER INCOME (EXPENSE)

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

31,374

 

 

 

61

 

 

 

79

 

Dividend income

 

 

1,551

 

 

 

-

 

 

 

-

 

Realized gain on investment

 

 

3,911

 

 

 

-

 

 

 

-

 

Realized gain on disposal of assets

 

 

637

 

 

 

-

 

 

 

-

 

Litigation settlement

 

 

(47,500

)

 

 

-

 

 

 

-

 

Commitment fee and interest expense

 

 

(548,026

)

 

 

(2,741

)

 

 

(19,550

)

  

 

 

 

 

 

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

 

 

 

 

 

NET LOSS

 

$

(33,316,216

)

 

$

(987,851

)

 

$

(922,471

)

  

 

 

 

 

 

 

 

 

 

 

 

 

Basic and Diluted Loss per Share

 

 

 

 

 

$

(0.02

)

 

$

(0.02

)

  

 

 

 

 

 

 

 

 

 

 

 

 

Basic and Diluted Weighted Average Number of Shares

 

 

 

52,764,679

 

 

 

50,461,598

 


See accompanying notes to these financial statements.




3




LIGHTWAVE LOGIC, INC.

(A Development Stage Company)

STATEMENT OF STOCKHOLDERS’ EQUITY

FOR THE PERIOD JANUARY 1, 2004 (INCEPTION OF DEVELOPMENT STAGE) TO

MARCH 31, 2014

(UNAUDITED)


 

 

 

 

 

 

 

 

 

 

 

Subscription

 

 

 

 

 

 

 

 

 

 

 

Deficit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Receivable/

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Receivable

 

 

 

 

 

Unrealized

 

 

 

 

 

During

 

 

 

 

 

 

Number of

 

 

Common

 

 

Paid-in

 

 

for Issuance

 

 

Deferred

 

 

Loss

 

 

Accumulated

 

 

Development

 

 

 

 

 

 

Shares

 

 

Stock

 

 

Capital

 

 

of Common Stock

 

 

Charges

 

 

on Securities

 

 

Deficit

 

 

Stage

 

 

Total

 

 

  

                    

 

 

                 

 

 

                   

 

 

                             

 

 

                    

 

 

                      

 

 

                      

 

 

                       

 

 

                    

 

ENDING BALANCE AT DECEMBER 31, 2003

 

 

100

 

 

$

1

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

(15,827

)

 

$

-

 

 

$

(15,826

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retroactive recapitalization upon reverse acquisition

 

 

706,973

 

 

 

706

 

 

 

(706

)

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BALANCE AT JANUARY 1, 2004

 

 

707,073

 

 

 

707

 

 

 

(706

)

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(15,827

)

 

 

-

 

 

 

(15,826

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock issued to founders

 

 

13,292,927

 

 

 

13,293

 

 

 

(13,293

)

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Common stock issued for future services in July 2004 at $0.16/share

 

 

1,600,000

 

 

 

1,600

 

 

 

254,400

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

256,000

 

Common stock issued at merger

 

 

2,000,000

 

 

 

2,000

 

 

 

(2,000

)

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Common stock issued for future services in August 2004 at $0.12/share

 

 

637,500

 

 

 

638

 

 

 

74,362

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

75,000

 

Conversion of note payable in December 2004 at $0.16/share

 

 

187,500

 

 

 

187

 

 

 

29,813

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

30,000

 

Net loss for the year ended December 31, 2004

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(722,146

)

 

 

(722,146

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BALANCE AT DECEMBER 31, 2004

 

 

18,425,000

 

 

 

18,425

 

 

 

342,576

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(15,827

)

 

 

(722,146

)

 

 

(376,972

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock issued in private placement in April 2005 at $0.25/share

 

 

4,000,000

 

 

 

4,000

 

 

 

996,000

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,000,000

 

Conversion of notes payable in May 2005 at $0.16/share

 

 

3,118,750

 

 

 

3,119

 

 

 

495,881

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

499,000

 

Subscription receivable

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(6,500

)

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(6,500

)

Common stock issued for future services in August 2005, valued at $2.79/share

 

 

210,000

 

 

 

210

 

 

 

585,290

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

585,500

 

Common stock issued for future services in August 2005, valued at $2.92/share

 

 

200,000

 

 

 

200

 

 

 

583,800

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

584,000

 

Warrants issued for services in May 2005, vested during 2005, valued at $1.13/share

 

 

-

 

 

 

-

 

 

 

37,000

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

37,000

 

Warrants issued for services in September 2005, vested during 2005, valued at $1.45/share

 

 

-

 

 

 

-

 

 

 

24,200

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

24,200

 

Warrants issued for services in October 2005, vested during 2005, valued at $0.53/share

 

 

-

 

 

 

-

 

 

 

15,900

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

15,900

 

Warrants issued for future services in December 2005, vested during 2005, valued at $1.45/share

 

 

-

 

 

 

-

 

 

 

435,060

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

435,060

 

Deferred charges for common stock issued for future services in August 2005, valued at $2.92/share

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(584,000

)

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(584,000

)

Amortization of deferred charges

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

265,455

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

265,455

 

Exercise of warrants in December 2005 at $0.25/share

 

 

300,000

 

 

 

300

 

 

 

74,700

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

75,000

 

Net loss for the year ended December 31, 2005

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(1,721,765

)

 

 

(1,721,765

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BALANCE AT DECEMBER 31, 2005

 

 

26,253,750

 

 

 

26,254

 

 

 

3,590,407

 

 

 

(6,500

)

 

 

(318,545

)

 

 

-

 

 

 

(15,827

)

 

 

(2,443,911

)

 

 

831,878

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock issued in private placement during 2006 at $0.50/share

 

 

850,000

 

 

 

850

 

 

 

424,150

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

425,000

 

Common stock issued for future services in February 2006, valued at $0.90/share

 

 

300,000

 

 

 

300

 

 

 

269,700

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

270,000

 

Common stock issued for future services in May 2006, valued at $1.55/share

 

 

400,000

 

 

 

400

 

 

 

619,600

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

620,000

 

Common stock issued for future services in June 2006, valued at $1.45/share

 

 

25,000

 

 

 

25

 

 

 

36,225

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

36,250

 

Common stock issued for future services in November 2006, valued at $0.49/share

 

 

60,000

 

 

 

60

 

 

 

29,340

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

29,400

 

Warrants issued for services in September 2005, vested during 2006, valued at $1.45/share

 

 

-

 

 

 

-

 

 

 

66,500

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

66,500

 

Warrants issued for future services in June 2006, vested during 2006, valued at $1.55/share

 

 

-

 

 

 

-

 

 

 

465,996

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

465,996

 

Options issued for services in February 2006, vested during 2006, valued at $1.01/share

 

 

-

 

 

 

-

 

 

 

428,888

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

428,888

 

Contributed capital related to accrued interest

 

 

-

 

 

 

-

 

 

 

35,624

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

35,624

 

Subscription receivable

 

 

-

 

 

 

-

 

 

 

-

 

 

 

6,500

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

6,500

 

Amortization of deferred charges

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

318,545

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

318,545

 

Unrealized gain (loss) on securities

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(26,000

)

 

 

-

 

 

 

-

 

 

 

(26,000

)

Net loss for the year ending December 31, 2006

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

 

 

 

 

-

 

 

 

(2,933,809

)

 

 

(2,933,809

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BALANCE AT DECEMBER 31, 2006

 

 

27,888,750

 

 

$

27,889

 

 

$

5,966,430

 

 

$

-

 

 

$

-

 

 

$

(26,000

)

 

$

(15,827

)

 

$

(5,377,720

)

 

$

574,772

 


See accompanying notes to these financial statements.




4




LIGHTWAVE LOGIC, INC.

(A Development Stage Company)

STATEMENT OF STOCKHOLDERS’ EQUITY

FOR THE PERIOD JANUARY 1, 2004 (INCEPTION OF DEVELOPMENT STAGE) TO

MARCH 31, 2014 (CONTINUED)

(UNAUDITED)


 

 

 

 

 

 

 

 

 

 

 

Subscription

 

 

 

 

 

 

 

 

 

 

 

Deficit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Receivable/

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Receivable

 

 

 

 

 

Unrealized

 

 

 

 

 

During

 

 

 

 

 

 

Number of

 

 

Common

 

 

Paid-in

 

 

for Issuance

 

 

Deferred

 

 

Loss

 

 

Accumulated

 

 

Development

 

 

 

 

 

 

Shares

 

 

Stock

 

 

Capital

 

 

of Common Stock

 

 

Charges

 

 

on Securities

 

 

Deficit

 

 

Stage

 

 

Total

 

 

  

                    

 

 

                 

 

 

                   

 

 

                             

 

 

                    

 

 

                      

 

 

                      

 

 

                       

 

 

                    

 

BALANCE AT DECEMBER 31, 2006

 

 

27,888,750

 

 

$

27,889

 

 

$

5,966,430

 

 

$

-

 

 

$

-

 

 

$

(26,000

)

 

$

(15,827

)

 

$

(5,377,720

)

 

$

574,772

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock issued in private placement during 2007 at $0.50/share

 

 

2,482,000

 

 

 

2,482

 

 

 

1,238,518

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,241,000

 

Common stock issued in private placement during 2007 at $0.60/share

 

 

1,767,540

 

 

 

1,768

 

 

 

1,058,756

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,060,524

 

Common stock subscription rescinded during 2007 at $0.50/share

 

 

(400,000

)

 

 

(400

)

 

 

(199,600

)

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(200,000

)

Common stock issued for future services in February 2007, valued at $0.70/share

 

 

151,785

 

 

 

152

 

 

 

106,098

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

106,250

 

Common stock issued for future services in March 2007, valued at $0.58/share

 

 

1,000,000

 

 

 

1,000

 

 

 

579,000

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

580,000

 

Common stock issued for services and settlement for accounts payable in April 2007, valued at $0.35/share

 

 

100,000

 

 

 

100

 

 

 

34,900

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

35,000

 

Common stock issued for services in October 2007, valued at $0.68/share

 

 

150,000

 

 

 

150

 

 

 

101,850

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

102,000

 

Common stock issued for services in October 2007, valued at $0.90/share

 

 

150,000

 

 

 

150

 

 

 

134,850

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

135,000

 

Common stock issued for services in November 2007, valued at $0.72/share

 

 

400,000

 

 

 

400

 

 

 

287,600

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

288,000

 

Warrants issued for services in September 2005, vested during 2007, valued at $1.45/share

 

 

-

 

 

 

-

 

 

 

36,370

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

36,370

 

Warrants issued for services in March 2007, vested during 2007, valued at $0.63/share

 

 

-

 

 

 

-

 

 

 

52,180

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

52,180

 

Warrants issued for services in April 2007, vested during 2007, valued at $0.69/share

 

 

-

 

 

 

-

 

 

 

293,476

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

293,476

 

Warrants issued for services in April 2007, vested during 2007, valued at $0.63/share

 

 

-

 

 

 

-

 

 

 

140,490

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

140,490

 

Warrants issued for services in May 2007, vested during 2007, valued at $0.56/share

 

 

-

 

 

 

-

 

 

 

52,946

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

52,946

 

Warrants issued for services in October 2007, vested during 2007, valued at $0.61/share

 

 

-

 

 

 

-

 

 

 

61,449

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

61,449

 

Warrants issued for services in October 2007, vested during 2007, valued at $0.78/share

 

 

-

 

 

 

-

 

 

 

52,292

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

52,292

 

Warrants issued for services in December 2007, vested during 2007, valued at $0.55/share

 

 

-

 

 

 

-

 

 

 

1,159

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,159

 

Options issued for services in February 2006, vested during 2007, valued at $1.01/share

 

 

-

 

 

 

-

 

 

 

17,589

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

17,589

 

Options issued for services in February 2006, vested during 2007, valued at $1.09/share

 

 

-

 

 

 

-

 

 

 

43,757

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

43,757

 

Options issued for services in November 2007, vested during 2007, valued at $0.60/share

 

 

-

 

 

 

-

 

 

 

41,653

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

41,653

 

Warrants issued for future services in April 2007, vested during 2007, valued at $0.70/share

 

 

-

 

 

 

-

 

 

 

348,000

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

348,000

 

Deferred charges for common stock issued for future services in March 2007, valued at $0.58/share

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(928,000

)

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(928,000

)

Amortization of deferred charges

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

773,333

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

773,333

 

Unrealzed gain (loss) on securities

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(32,610

)

 

 

-

 

 

 

-

 

 

 

(32,610

)

Net loss for the year ending December 31, 2007

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(4,223,449

)

 

 

(4,223,449

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BALANCE AT DECEMBER 31, 2007

 

 

33,690,075

 

 

 

33,690

 

 

 

10,449,763

 

 

 

-

 

 

 

(154,667

)

 

 

(58,610

)

 

 

(15,827

)

 

 

(9,601,169

)

 

 

653,180

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock issued in private placement during 2008 at $0.60/share

 

 

690,001

 

 

 

690

 

 

 

413,310

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

414,000

 

Common stock issued for services in March 2008, valued at $0.75/share

 

 

100,000

 

 

 

100

 

 

 

74,900

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

75,000

 

Common stock issued for services in August 2008, valued at $1.80/share

 

 

200,000

 

 

 

200

 

 

 

359,800

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

360,000

 

Exercise of warrants at $0.25/share

 

 

320,000

 

 

 

320

 

 

 

79,680

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

80,000

 

Exercise of warrants at $0.25/share, pursuant to November 2008 adjusted stock offering

 

 

641,080

 

 

 

641

 

 

 

159,629

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

160,270

 

Exercise of warrants at $0.50/share

 

 

270,000

 

 

 

270

 

 

 

134,730

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

135,000

 

Warrants issued for services in September 2005, vested during 2008, valued at $1.45/share

 

 

-

 

 

 

-

 

 

 

27,014

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

27,014

 

Warrants issued for services in March 2007, vested during 2008, valued at $0.63/share

 

 

-

 

 

 

-

 

 

 

10,885

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

10,885

 

Warrants issued for services in April 2007, vested during 2008, valued at $0.69/share

 

 

-

 

 

 

-

 

 

 

121,713

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

121,713

 

Warrants issued for services in April 2007, vested during 2008, valued at $0.63/share

 

 

-

 

 

 

-

 

 

 

48,738

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

48,738

 

Warrants issued for services in May 2007, vested during 2008, valued at $0.56/share

 

 

-

 

 

 

-

 

 

 

31,444

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

31,444

 

Warrants issued for services in December 2007, vested during 2008, valued at $0.55/share

 

 

-

 

 

 

-

 

 

 

12,487

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

12,487

 

Options issued for services in November 2007, vested during 2008, valued at $0.60/share

 

 

-

 

 

 

-

 

 

 

286,803

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

286,803

 

Options issued for services in January 2008, vested during 2008, valued at $0.60/share

 

 

-

 

 

 

-

 

 

 

30,750

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

30,750

 

Options issued for services in July 2008, vested during 2008, valued at $1.48/share

 

 

-

 

 

 

-

 

 

 

114,519

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

114,519

 

Options issued for services in August 2008, vested during 2008, valued at $1.36/share

 

 

-

 

 

 

-

 

 

 

525,263

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

525,263

 

Options issued for services in November 2008, vested during 2008, valued at $0.50/share

 

 

-

 

 

 

-

 

 

 

6,439

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

6,439

 

Warrants issued for future services in March 2008, vested through September 2008, valued at $0.83/share

 

 

-

 

 

 

-

 

 

 

332,000

 

 

 

-

 

 

 

(332,000

)

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Warrants issued for services in May 2008, vested through September 2008, valued at $1.63/share

 

 

-

 

 

 

-

 

 

 

976,193

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

976,193

 

Amortization of deferred charges

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

431,337

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

431,337

 

Receivable for the issuance of common stock

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(12,500

)

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(12,500

)

Realized loss reclassification

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

58,610

 

 

 

-

 

 

 

-

 

 

 

58,610

 

Net loss for the year ending December 31, 2008

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(4,340,607

)

 

 

(4,340,607

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BALANCE AT DECEMBER 31, 2008

 

 

35,911,156

 

 

$

35,911

 

 

$

14,196,060

 

 

$

(12,500

)

 

$

(55,330

)

 

$

-

 

 

$

(15,827

)

 

$

(13,941,776

)

 

$

206,538

 



See accompanying notes to these financial statements.




5




LIGHTWAVE LOGIC, INC.

(A Development Stage Company)

STATEMENT OF STOCKHOLDERS’ EQUITY

FOR THE PERIOD JANUARY 1, 2004 (INCEPTION OF DEVELOPMENT STAGE) TO

MARCH 31, 2014 (CONTINUED)

(UNAUDITED)


 

 

 

 

 

 

 

 

 

 

 

Subscription

 

 

 

 

 

 

 

 

 

 

 

Deficit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Receivable/

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Receivable

 

 

 

 

 

Unrealized

 

 

 

 

 

During

 

 

 

 

 

 

Number of

 

 

Common

 

 

Paid-in

 

 

for Issuance

 

 

Deferred

 

 

Loss

 

 

Accumulated

 

 

Development

 

 

 

 

 

 

Shares

 

 

Stock

 

 

Capital

 

 

of Common Stock

 

 

Charges

 

 

on Securities

 

 

Deficit

 

 

Stage

 

 

Total

 

 

  

                    

 

 

                 

 

 

                   

 

 

                             

 

 

                    

 

 

                      

 

 

                      

 

 

                       

 

 

                    

 

BALANCE AT DECEMBER 31, 2008

 

 

35,911,156

 

 

$

35,911

 

 

$

14,196,060

 

 

$

(12,500

)

 

$

(55,330

)

 

$

-

 

 

$

(15,827

)

 

$

(13,941,776

)

 

$

206,538

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rights to purchase shares issued in January 2009, vested during 2009, valued at $0.33/share

 

 

-

 

 

 

-

 

 

 

132,058

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

132,058

 

Common stock issued for services in January 2009, valued at $0.58/share

 

 

100,000

 

 

 

100

 

 

 

57,900

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

58,000

 

Common stock issued for services & settlement for accounts payable January 2009 valued at $0.25/share

 

 

100,000

 

 

 

100

 

 

 

24,900

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

25,000

 

Exercise of purchase right agreement in January 2009 at $0.25/share

 

 

180,550

 

 

 

181

 

 

 

44,957

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

45,138

 

Exercise of warrants at $0.25/share, pursuant to November 2008 adjusted stock offering

 

 

1,279,336

 

 

 

1,279

 

 

 

318,555

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

319,834

 

Exercise of warrants at $0.001/share

 

 

400,000

 

 

 

400

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

400

 

Exercise of warrants at $1.00/share

 

 

355,000

 

 

 

355

 

 

 

354,645

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

355,000

 

Options issued for services in November 2007, vested during 2009, valued at $0.60/share

 

 

-

 

 

 

-

 

 

 

199,234

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

199,234

 

Options issued for services in January 2008, vested during 2009, valued at $0.60/share

 

 

-

 

 

 

-

 

 

 

13,583

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

13,583

 

Options issued for services in July 2008, vested during 2009, valued at $1.48/share

 

 

-

 

 

 

-

 

 

 

67,838

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

67,838

 

Options issued for services in August 2008, vested during 2009, valued at $1.36/share

 

 

-

 

 

 

-

 

 

 

623,246

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

623,246

 

Options issued for services in November 2008, vested during 2009, valued at $0.50/share

 

 

-

 

 

 

-

 

 

 

61,346

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

61,346

 

Options issued for services in January 2009, vested during 2009, valued at $0.53/share

 

 

-

 

 

 

-

 

 

 

13,136

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

13,136

 

Options issued for services in February 2009, vested during 2009, valued at $0.38/share

 

 

-

 

 

 

-

 

 

 

9,583

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

9,583

 

Options issued for services in June 2009, vested during 2009, valued at $0.85/share

 

 

-

 

 

 

-

 

 

 

21,085

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

21,085

 

Warrants issued for services in June 2009, vested during 2009, valued at $0.85/share

 

 

-

 

 

 

-

 

 

 

177,881

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

177,881

 

Contribution of accrued payroll in February 2009

 

 

-

 

 

 

-

 

 

 

52,129

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

52,129

 

Amortization of deferred charges

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

55,330

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

55,330

 

Payment for the issuance of common stock

 

 

-

 

 

 

-

 

 

 

-

 

 

 

12,500

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

12,500

 

Common stock issued for services in June 2009, valued at $0.34/share

 

 

116,000

 

 

 

116

 

 

 

39,884

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

40,000

 

Common stock issued for services & settlement for accounts payable June 2009 valued at $0.34/share

 

 

145,000

 

 

 

145

 

 

 

49,855

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

50,000

 

Common stock issued in private placement during June 2009 at $0.34/share

 

 

2,479,500

 

 

 

2,480

 

 

 

852,520

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

855,000

 

Common stock issued for services in July 2009, valued at $0.75/share

 

 

100,000

 

 

 

100

 

 

 

74,900

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

75,000

 

Net loss for the year ending December 31, 2009

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(2,721,871

)

 

 

(2,721,871

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BALANCE AT December 31, 2009

 

 

41,166,542

 

 

 

41,167

 

 

 

17,385,295

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(15,827

)

 

 

(16,663,647

)

 

 

746,988

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Options issued for services in November 2007, vested during 2010, valued at $0.60/share

 

 

-

 

 

 

-

 

 

 

174,866

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

174,866

 

Options issued for services in January 2008, vested during 2010, valued at $0.60/share

 

 

-

 

 

 

-

 

 

 

14,873

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

14,873

 

Options issued for services in July 2008, vested during 2010, valued at $1.48/share

 

 

-

 

 

 

-

 

 

 

74,061

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

74,061

 

Options issued for services in August 2008, vested during 2010, valued at $1.36/share

 

 

-

 

 

 

-

 

 

 

643,812

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

643,812

 

Options issued for services in November 2008, vested during 2010, valued at $0.50/share

 

 

-

 

 

 

-

 

 

 

31,478

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

31,478

 

Warrants issued for services in June 2009, vested during 2010, valued at $0.85/share

 

 

-

 

 

 

-

 

 

 

213,459

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

213,459

 

Warrants issued for services in January 2010, vested during 2010, valued at $1.83/share

 

 

 

 

 

 

 

 

 

 

580,167

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

580,167

 

Warrants issued for services in March 2010, vested during 2010, valued at $1.86/share

 

 

-

 

 

 

-

 

 

 

214,063

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

214,063

 

Options issued for services in August 2010, vested during 2010, valued at $1.31/share

 

 

 

 

 

 

 

 

 

 

27,434

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

27,434

 

Options issued for services in December 2010, vested during 2010, valued at $1.14/share

 

 

 

 

 

 

 

 

 

 

286,002

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

286,002

 

Exercise of warrants at $0.25/share

 

 

947,200

 

 

 

947

 

 

 

235,853

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

236,800

 

Exercise of options at $0.25/share

 

 

15,000

 

 

 

15

 

 

 

3,735

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,750

 

Exercise of warrants at $0.345/share

 

 

10,000

 

 

 

10

 

 

 

3,440

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,450

 

Exercise of warrants at $0.50/share

 

 

25,000

 

 

 

25

 

 

 

12,475

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

12,500

 

Exercise of warrants at $1.00/share

 

 

282,500

 

 

 

283

 

 

 

282,218

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

282,500

 

Common stock issued in private placement during 2010 at $1.00/share

 

 

1,500,000

 

 

 

1,500

 

 

 

1,498,500

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,500,000

 

Common stock issued for services in August 2010, valued at $1.25/share

 

 

4,800

 

 

 

4

 

 

 

5,996

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

6,000

 

Common stock issued for services in November 2010, valued at $0.93/share

 

 

5,000

 

 

 

5

 

 

 

4,645

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

4,650

 

Common stock issued for services in December 2010, valued at $01.20/share

 

 

10,000

 

 

 

10

 

 

 

11,990

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

12,000

 

Net loss for the year ending December 31, 2010

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(3,713,232

)

 

 

(3,713,232

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BALANCE AT DECEMBER 31, 2010

 

 

43,966,042

 

 

$

43,966

 

 

$

21,704,361

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

(15,827

)

 

$

(20,376,879

)

 

$

1,355,621

 



See accompanying notes to these financial statements.




6




LIGHTWAVE LOGIC, INC.

(A Development Stage Company)

STATEMENT OF STOCKHOLDERS’ EQUITY

FOR THE PERIOD JANUARY 1, 2004 (INCEPTION OF DEVELOPMENT STAGE) TO

MARCH 31, 2014 (CONTINUED)

(UNAUDITED)


 

 

 

 

 

 

 

 

 

 

 

Subscription

 

 

 

 

 

 

 

 

 

 

 

Deficit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Receivable/

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Receivable

 

 

 

 

 

Unrealized

 

 

 

 

 

During

 

 

 

 

 

 

Number of

 

 

Common

 

 

Paid-in

 

 

for Issuance

 

 

Deferred

 

 

Loss

 

 

Accumulated

 

 

Development

 

 

 

 

 

 

Shares

 

 

Stock

 

 

Capital

 

 

of Common Stock

 

 

Charges

 

 

on Securities

 

 

Deficit

 

 

Stage

 

 

Total

 

 

  

                    

 

 

                 

 

 

                   

 

 

                             

 

 

                    

 

 

                      

 

 

                      

 

 

                       

 

 

                    

 

BALANCE AT DECEMBER 31, 2010

 

 

43,966,042

 

 

$

43,966

 

 

$

21,704,361

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

(15,827

)

 

$

(20,376,879

)

 

$

1,355,621

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock issued for services in March 2011, valued at $1.45/share

 

 

10,000

 

 

 

10

 

 

 

14,490

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

14,500

 

Options issued for services in January 2008, vested during 2011, valued at $0.60/share

 

 

-

 

 

 

-

 

 

 

285

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

285

 

Options issued for services in July 2008, vested during 2011, valued at $1.48/share

 

 

-

 

 

 

-

 

 

 

39,829

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

39,829

 

Options issued for services in August 2008, vested during 2011, valued at $1.36/share

 

 

-

 

 

 

-

 

 

 

383,881

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

383,881

 

Options issued for services in November 2008, vested during 2011, valued at $0.50/share

 

 

-

 

 

 

-

 

 

 

26,648

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

26,648

 

Warrants issued for services in January 2010, vested during 2011, valued at $1.83/share

 

 

-

 

 

 

-

 

 

 

306,765

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

306,765

 

Warrants issued for services in March 2010, vested during 2011, valued at $1.86/share

 

 

-

 

 

 

-

 

 

 

64,983

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

64,983

 

Options issued for services in August 2010, vested during 2011, valued at $1.31/share

 

 

-

 

 

 

-

 

 

 

65,447

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

65,447

 

Options issued for services in December 2010, vested during 2011, valued at $1.14/share

 

 

-

 

 

 

-

 

 

 

212,136

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

212,136

 

Warrants issued for services in January 2011, vested during 2011, valued at $1.05/share

 

 

-

 

 

 

-

 

 

 

36,585

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

36,585

 

Warrants issued for services in April 2011, vested during 2011, valued at $0.98/share

 

 

-

 

 

 

-

 

 

 

109,820

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

109,820

 

Options issued for services in May 2011, vested during 2011, valued at $0.97/share

 

 

-

 

 

 

-

 

 

 

79,702

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

79,702

 

Options issued for services in August 2011, vested during 2011, valued at $0.82/share

 

 

-

 

 

 

-

 

 

 

17,204

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

17,204

 

Options issued for services in November 2011, vested during 2011, valued at $0.53/share

 

 

-

 

 

 

-

 

 

 

4,384

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

4,384

 

Options issued for services in December 2011, vested during 2011, valued at $0.82/share

 

 

-

 

 

 

-

 

 

 

53,124

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

53,124

 

Warrants issued for services in December 2011, vested during 2011, valued at $1.05/share

 

 

-

 

 

 

-

 

 

 

1,288

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,288

 

Common stock issued for commitment shares, valued at $1.08/share

 

 

150,830

 

 

 

151

 

 

 

162,746

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

162,896

 

Common stock issued to institutional investor, valued at $1.08/share

 

 

185,185

 

 

 

185

 

 

 

199,815

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

200,000

 

Common stock issued for additional commitment shares, valued at $1.15/share

 

 

3,017

 

 

 

3

 

 

 

3,467

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,470

 

Common stock issued for services in June 2011, valued at $1.04/share

 

 

10,000

 

 

 

10

 

 

 

10,390

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

10,400

 

Common stock issued in private placement during 2011 at $1.00/share

 

 

1,000,000

 

 

 

1,000

 

 

 

999,000

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,000,000

 

Common stock issued for services in September 2011, valued at $1.45/share

 

 

10,000

 

 

 

10

 

 

 

14,490

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

14,500

 

Common stock issued for services in May 2011 through August 2011, valued at $0.90/share to $1.25/share

 

 

2,018

 

 

 

2

 

 

 

2,161

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

2,163

 

Net loss for the year ending December 31, 2011

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(3,482,622

)

 

 

(3,482,622

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BALANCE AT DECEMBER 31, 2011

 

 

45,337,092

 

 

$

45,337

 

 

$

24,513,000

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

(15,827

)

 

$

(23,859,501

)

 

$

683,009

 


See accompanying notes to these financial statements.




7




LIGHTWAVE LOGIC, INC.

(A Development Stage Company)

STATEMENT OF STOCKHOLDERS’ EQUITY

FOR THE PERIOD JANUARY 1, 2004 (INCEPTION OF DEVELOPMENT STAGE) TO

MARCH 31, 2014 (CONTINUED)

(UNAUDITED)


 

 

 

 

 

 

 

 

 

 

 

Subscription

 

 

 

 

 

 

 

 

 

 

 

Deficit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Receivable/

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Receivable

 

 

 

 

 

Unrealized

 

 

 

 

 

During

 

 

 

 

 

 

Number of

 

 

Common

 

 

Paid-in

 

 

for Issuance

 

 

Deferred

 

 

Loss

 

 

Accumulated

 

 

Development

 

 

 

 

 

 

Shares

 

 

Stock

 

 

Capital

 

 

of Common Stock

 

 

Charges

 

 

on Securities

 

 

Deficit

 

 

Stage

 

 

Total

 

 

  

                    

 

 

                 

 

 

                   

 

 

                             

 

 

                    

 

 

                      

 

 

                      

 

 

                       

 

 

                    

 

BALANCE AT DECEMBER 31, 2011

 

 

45,337,092

 

 

$

45,337

 

 

$

24,513,000

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

(15,827

)

 

$

(23,859,501

)

 

$

683,009

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock issued to institutional investor, valued at $1.013/share

 

 

197,433

 

 

 

198

 

 

 

199,802

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

200,000

 

Common stock issued for additional commitment shares, valued at $1.64/share

 

 

3,017

 

 

 

3

 

 

 

4,945

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

4,948

 

Common stock issued to institutional investor, valued at $1.197/share

 

 

167,084

 

 

 

167

 

 

 

199,832

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

199,999

 

Common stock issued for additional commitment shares, valued at $1.67/share

 

 

3,017

 

 

 

3

 

 

 

5,035

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

5,038

 

Common stock issued to institutional investor, valued at $1.58/share

 

 

316,455

 

 

 

317

 

 

 

499,682

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

499,999

 

Common stock issued for additional commitment shares, valued at $2.87/share

 

 

7,542

 

 

 

7

 

 

 

21,638

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

21,645

 

Common stock issued to institutional investor, valued at $1.66/share

 

 

120,482

 

 

 

120

 

 

 

199,880

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

200,000

 

Common stock issued for additional commitment shares, valued at $1.97/share

 

 

3,017

 

 

 

3

 

 

 

5,940

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

5,943

 

Common stock issued to institutional investor, valued at $1.897/share

 

 

158,144

 

 

 

158

 

 

 

299,841

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

299,999

 

Common stock issued for additional commitment shares, valued at $2.60/share

 

 

4,525

 

 

 

5

 

 

 

11,760

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

11,765

 

Common stock issued to institutional investor, valued at $2.073/share

 

 

96,479

 

 

 

97

 

 

 

199,904

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

200,001

 

Common stock issued for additional commitment shares, valued at $2.64/share

 

 

3,017

 

 

 

3

 

 

 

7,962

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

7,965

 

Common stock issued to institutional investor, valued at $2.19/share

 

 

91,324

 

 

 

92

 

 

 

199,908

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

200,000

 

Common stock issued for additional commitment shares, valued at $2.23/share

 

 

3,017

 

 

 

3

 

 

 

6,725

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

6,728

 

Common stock issued to institutional investor, valued at $1.68/share

 

 

119,048

 

 

 

119

 

 

 

199,882

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

200,001

 

Common stock issued for additional commitment shares, valued at $1.80/share

 

 

3,017

 

 

 

3

 

 

 

5,428

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

5,431

 

Common stock issued to institutional investor, valued at $1.81/share

 

 

220,994

 

 

 

221

 

 

 

399,778

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

399,999

 

Common stock issued for additional commitment shares, valued at $1.88/share

 

 

3,017

 

 

 

3

 

 

 

5,669

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

5,672

 

Common stock issued for additional commitment shares, valued at $1.92/share

 

 

3,017

 

 

 

3

 

 

 

5,790

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

5,793

 

Common stock issued to institutional investor, valued at $1.53/share

 

 

130,719

 

 

 

131

 

 

 

199,870

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

200,001

 

Common stock issued for additional commitment shares, valued at $1.60/share

 

 

3,017

 

 

 

3

 

 

 

4,824

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

4,827

 

Common stock issued to institutional investor, valued at $1.667/share

 

 

119,976

 

 

 

120

 

 

 

199,880

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

200,000

 

Common stock issued for additional commitment shares, valued at $1.93/share

 

 

3,017

 

 

 

3

 

 

 

5,820

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

5,823

 

Common stock issued to institutional investor, valued at $1.51/share

 

 

132,450

 

 

 

132

 

 

 

199,867

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

199,999

 

Common stock issued for additional commitment shares, valued at $1.70/share

 

 

6,034

 

 

 

6

 

 

 

10,252

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

10,258

 

Common stock issued to institutional investor, valued at $1.677/share

 

 

119,261

 

 

 

119

 

 

 

199,882

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

200,001

 

Common stock issued for additional commitment shares, valued at $1.35/share

 

 

3,017

 

 

 

3

 

 

 

4,070

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

4,073

 

Common stock issued to institutional investor, valued at $1.13/share

 

 

176,991

 

 

 

177

 

 

 

199,823

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

200,000

 

Common stock issued for additional commitment shares, valued at $1.28/share

 

 

3,017

 

 

 

3

 

 

 

3,859

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,862

 

Common stock issued to institutional investor, valued at $1.1267/share

 

 

177,510

 

 

 

178

 

 

 

199,823

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

200,001

 

Common stock issued for additional commitment shares, valued at $1.28/share

 

 

3,017

 

 

 

3

 

 

 

3,859

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,862

 

Common stock issued to institutional investor, valued at $1.107/share

 

 

180,668

 

 

 

180

 

 

 

199,820

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

200,000

 

Common stock issued for additional commitment shares, valued at $1.18/share

 

 

3,017

 

 

 

3

 

 

 

3,557

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,560

 

Common stock issued to institutional investor, valued at $1.10/share

 

 

181,818

 

 

 

182

 

 

 

199,818

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

200,000

 

Common stock issued for additional commitment shares, valued at $1.08/share

 

 

3,017

 

 

 

3

 

 

 

3,255

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,258

 

Common stock issued to institutional investor, valued at $1.063/share

 

 

188,147

 

 

 

188

 

 

 

199,812

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

200,000

 

Common stock issued for additional commitment shares, valued at $1.09/share

 

 

3,017

 

 

 

3

 

 

 

3,286

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,289

 

Common stock issued to institutional investor, valued at $1.02/share

 

 

196,078

 

 

 

196

 

 

 

199,803

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

199,999

 

Common stock issued for additional commitment shares, valued at $1.04/share

 

 

1,508

 

 

 

2

 

 

 

1,566

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,568

 

Common stock issued to institutional investor, valued at $1.02/share

 

 

98,039

 

 

 

98

 

 

 

99,902

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

100,000

 

Common stock issued for additional commitment shares, valued at $1.10/share

 

 

2,262

 

 

 

2

 

 

 

2,486

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

2,488

 

Common stock issued to institutional investor, valued at $1.00/share

 

 

350,000

 

 

 

350

 

 

 

349,650

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

350,000

 

Common stock issued for additional commitment shares, valued at $1.00/share

 

 

3,017

 

 

 

3

 

 

 

3,014

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,017

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Subtotal

 

 

48,949,352

 

 

$

48,950

 

 

$

29,490,199

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

(15,827

)

 

$

(23,859,501

)

 

$

5,663,821

 


See accompanying notes to these financial statements.




8




LIGHTWAVE LOGIC, INC.

(A Development Stage Company)

STATEMENT OF STOCKHOLDERS’ EQUITY

FOR THE PERIOD JANUARY 1, 2004 (INCEPTION OF DEVELOPMENT STAGE) TO

MARCH 31, 2014 (CONTINUED)

(UNAUDITED)


 

 

 

 

 

 

 

 

 

 

 

Subscription

 

 

 

 

 

 

 

 

 

 

 

Deficit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Receivable/

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Receivable

 

 

 

 

 

Unrealized

 

 

 

 

 

During

 

 

 

 

 

 

Number of

 

 

Common

 

 

Paid-in

 

 

for Issuance

 

 

Deferred

 

 

Loss

 

 

Accumulated

 

 

Development

 

 

 

 

 

 

Shares

 

 

Stock

 

 

Capital

 

 

of Common Stock

 

 

Charges

 

 

on Securities

 

 

Deficit

 

 

Stage

 

 

Total

 

 

  

                    

 

 

                 

 

 

                   

 

 

                             

 

 

                    

 

 

                      

 

 

                      

 

 

                       

 

 

                    

 

Subtotal

 

 

48,949,352

 

 

$

48,950

 

 

$

29,490,199

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

(15,827

)

 

$

(23,859,501

)

 

$

5,663,821

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exercise of options at $0.65/share

 

 

250,000

 

 

 

250

 

 

 

162,250

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

162,500

 

Exercise of warrants at $1.25/share

 

 

40,000

 

 

 

40

 

 

 

49,960

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

50,000

 

Exercise of warrants at $0.34/share

 

 

20,000

 

 

 

20

 

 

 

6,880

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

6,900

 

Exercise of warrants at $0.25/share

 

 

900,000

 

 

 

900

 

 

 

224,100

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

225,000

 

Common stock issued for services in October 2011 through January 2012, valued at $0.65/share to $2.70/share

 

 

1,406

 

 

 

1

 

 

 

1,606

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,607

 

Options issued for services in August 2010, vested during 2012, valued at $1.31/share

 

 

-

 

 

 

-

 

 

 

38,194

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

38,194

 

Options issued for services in December 2010, vested during 2012, valued at $1.14/share

 

 

-

 

 

 

-

 

 

 

85,290

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

85,290

 

Warrants issued for services in April 2011, vested during 2012, valued at $0.98/share

 

 

-

 

 

 

-

 

 

 

36,605

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

36,605

 

Options issued for services in May 2011, vested during 2012, valued at $0.97/share

 

 

-

 

 

 

-

 

 

 

48,510

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

48,510

 

Options issued for services in August 2011, vested during 2012, valued at $0.82/share

 

 

-

 

 

 

-

 

 

 

41,156

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

41,156

 

Options issued for services in November 2011, vested during 2012, valued at $0.53/share

 

 

-

 

 

 

-

 

 

 

26,304

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

26,304

 

Options issued for services in December 2011, vested during 2012, valued at $0.82/share

 

 

-

 

 

 

-

 

 

 

51,392

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

51,392

 

Warrants issued for services in December 2011, vested during 2012, valued at $1.05/share

 

 

-

 

 

 

-

 

 

 

157,127

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

157,127

 

Options issued for services in March 2012, vested during 2012, valued at $1.37/share

 

 

-

 

 

 

-

 

 

 

139,755

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

139,755

 

Options issued for services in March 2012, vested during 2012, valued at $1.37/share

 

 

-

 

 

 

-

 

 

 

42,227

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

42,227

 

Warrants issued for services in March 2012, vested during 2012, valued at $1.37/share

 

 

-

 

 

 

-

 

 

 

13,709

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

13,709

 

Options issued for services in May 2012, vested during 2012, valued at $1.23/share

 

 

-

 

 

 

-

 

 

 

462,455

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

462,455

 

Warrants issued for services in May 2012, vested during 2012, valued at $0.97/share

 

 

-

 

 

 

-

 

 

 

55,648

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

55,648

 

Options issued for services in June 2012, vested during 2012, valued at $0.73/share

 

 

-

 

 

 

-

 

 

 

56,568

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

56,568

 

Options issued for services in August 2012, vested during 2012, valued at $0.74/share

 

 

-

 

 

 

-

 

 

 

15,611

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

15,611

 

Options issued for services in August 2012, vested during 2012, valued at $0.75/share

 

 

-

 

 

 

-

 

 

 

7,137

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

7,137

 

Warrants issued for services in December 2012, vested during 2012, valued at $0.78/share

 

 

-

 

 

 

-

 

 

 

28,237

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

28,237

 

Options extended for services in November 2012, vested during 2012, valued at $0.27/share

 

 

-

 

 

 

-

 

 

 

266,710

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

266,710

 

Options extended for services in November 2012, vested during 2012, valued at $0.25/share

 

 

-

 

 

 

-

 

 

 

25,420

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

25,420

 

Options extended for services in November 2012, vested during 2012, valued at $0.24/share

 

 

-

 

 

 

-

 

 

 

60,283

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

60,283

 

Options extended for services in November 2012, vested during 2012, valued at $0.29/share

 

 

-

 

 

 

-

 

 

 

309,049

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

309,049

 

Options extended for services in November 2012, vested during 2012, valued at $0.29/share

 

 

-

 

 

 

-

 

 

 

29,375

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

29,375

 

Options extended for services in November 2012, vested during 2012, valued at $0.26/share

 

 

-

 

 

 

-

 

 

 

39,270

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

39,270

 

Options extended for services in November 2012, vested during 2012, valued at $0.30/share

 

 

-

 

 

 

-

 

 

 

29,529

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

29,529

 

Options extended for services in November 2012, vested during 2012, valued at $0.28/share

 

 

-

 

 

 

-

 

 

 

42,195

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

42,195

 

Net loss for the year ending December 31, 2012

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(4,556,538

)

 

 

(4,556,538

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BALANCE AT DECEMBER 31, 2012

 

 

50,160,758

 

 

$

50,161

 

 

$

32,042,751

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

(15,827

)

 

$

(28,416,039

)

 

$

3,661,046

 


See accompanying notes to these financial statements.




9




LIGHTWAVE LOGIC, INC.

(A Development Stage Company)

STATEMENT OF STOCKHOLDERS’ EQUITY

FOR THE PERIOD JANUARY 1, 2004 (INCEPTION OF DEVELOPMENT STAGE) TO

MARCH 31, 2014 (CONTINUED)

(UNAUDITED)


 

 

 

 

 

 

 

 

 

 

 

Subscription

 

 

 

 

 

 

 

 

 

 

 

Deficit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Receivable/

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Receivable

 

 

 

 

 

Unrealized

 

 

 

 

 

During

 

 

 

 

 

 

Number of

 

 

Common

 

 

Paid-in

 

 

for Issuance

 

 

Deferred

 

 

Loss

 

 

Accumulated

 

 

Development

 

 

 

 

 

 

Shares

 

 

Stock

 

 

Capital

 

 

of Common Stock

 

 

Charges

 

 

on Securities

 

 

Deficit

 

 

Stage

 

 

Total

 

 

  

                    

 

 

                 

 

 

                   

 

 

                             

 

 

                    

 

 

                      

 

 

                      

 

 

                       

 

 

                    

 

BALANCE AT DECEMBER 31, 2012

 

 

50,160,758

 

 

$

50,161

 

 

$

32,042,751

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

(15,827

)

 

$

(28,416,039

)

 

$

3,661,046

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock issued to institutional investor, valued at $1.07/share

 

 

186,916

 

 

 

187

 

 

 

199,813

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

200,000

 

Common stock issued for additional commitment shares, valued at $1.11/share

 

 

3,017

 

 

 

3

 

 

 

3,346

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,349

 

Common stock issued to institutional investor, valued at $1.027/share

 

 

196,078

 

 

 

196

 

 

 

199,803

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

199,999

 

Common stock issued for additional commitment shares, valued at $1.07/share

 

 

3,017

 

 

 

3

 

 

 

3,225

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,228

 

Common stock issued to institutional investor, valued at $1.037/share

 

 

192,864

 

 

 

193

 

 

 

199,807

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

200,000

 

Common stock issued for additional commitment shares, valued at $1.36/share

 

 

3,017

 

 

 

3

 

 

 

4,100

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

4,103

 

Common stock issued to institutional investor, valued at $1.1367/share

 

 

175,948

 

 

 

176

 

 

 

199,824

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

200,000

 

Common stock issued for additional commitment shares, valued at $1.35/share

 

 

3,017

 

 

 

3

 

 

 

4,070

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

4,073

 

Common stock issued to institutional investor, valued at $1.2533/share

 

 

159,579

 

 

 

160

 

 

 

199,841

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

200,001

 

Common stock issued for additional commitment shares, valued at $2.59/share

 

 

3,017

 

 

 

3

 

 

 

4,794

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

4,797

 

Common stock issued to institutional investor, valued at $1.34/share

 

 

149,254

 

 

 

149

 

 

 

199,851

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

200,000

 

Common stock issued for additional commitment shares, valued at $1.55/share

 

 

3,017

 

 

 

3

 

 

 

4,674

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

4,677

 

Common stock issued to institutional investor, valued at $1.14/share

 

 

175,439

 

 

 

175

 

 

 

199,825

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

200,000

 

Common stock issued for additional commitment shares, valued at $1.19/share

 

 

3,017

 

 

 

3

 

 

 

3,587

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,590

 

Common stock issued to institutional investor, valued at $1.04/share

 

 

192,308

 

 

 

192

 

 

 

199,808

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

200,000

 

Common stock issued for additional commitment shares, valued at $1.08/share

 

 

3,017

 

 

 

3

 

 

 

3,256

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,259

 

Common stock issued to institutional investor, valued at $1.00/share

 

 

200,000

 

 

 

200

 

 

 

199,800

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

200,000

 

Common stock issued for additional commitment shares, valued at $1.06/share

 

 

3,017

 

 

 

3

 

 

 

3,195

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,198

 

Common stock issued for commitment shares, valued at $0.85/share

 

 

200,000

 

 

 

200

 

 

 

169,800

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

170,000

 

Common stock issued to institutional investor, valued at $0.865/share

 

 

100,000

 

 

 

100

 

 

 

86,400

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

86,500

 

Common stock issued for additional commitment shares, valued at $1.03/share

 

 

1,730

 

 

 

2

 

 

 

1,780

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,782

 

Common stock issued to institutional investor, valued at $$0.9083/share

 

 

100,000

 

 

 

100

 

 

 

90,730

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

90,830

 

Common stock issued for additional commitment shares, valued at $1.06/share

 

 

1,370

 

 

 

1

 

 

 

1,451

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,452

 

Common stock issued to institutional investor, valued at $1.0117/share

 

 

100,000

 

 

 

100

 

 

 

101,070

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

101,170

 

Common stock issued for additional commitment shares, valued at $1.04/share

 

 

1,526

 

 

 

2

 

 

 

1,585

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,587

 

Common stock issued to institutional investor, valued at $1.00/share

 

 

100,000

 

 

 

100

 

 

 

99,900

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

100,000

 

Common stock issued for additional commitment shares, valued at $1.03/share

 

 

1,508

 

 

 

1

 

 

 

1,552

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,553

 

Common stock issued to institutional investor, valued at $1.00/share

 

 

100,000

 

 

 

100

 

 

 

99,900

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

100,000

 

Common stock issued for additional commitment shares, valued at $1.00/share

 

 

1,508

 

 

 

2

 

 

 

1,506

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,508

 

Exercise of warrants at $1.25/share

 

 

12,500

 

 

 

13

 

 

 

15,612

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

15,625

 

Exercise of warrants at $0.345/share

 

 

20,000

 

 

 

20

 

 

 

6,880

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

6,900

 

Reversal of common stock issuance during 2013 at $0.50/share

 

 

(2,000

)

 

 

(2

)

 

 

2

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Exercise of options at $1.01/share

 

 

38,350

 

 

 

38

 

 

 

38,695

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

38,733

 

Exercise of options at $0.45/share

 

 

25,000

 

 

 

25

 

 

 

11,225

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

11,250

 

Options issued for services in December 2010, vested during 2013, valued at $1.14/share

 

 

-

 

 

 

-

 

 

 

80,634

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

80,634

 

Options issued for services in May 2011, vested during 2013, valued at $0.97/share

 

 

-

 

 

 

-

 

 

 

48,378

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

48,378

 

Options issued for services in August 2011, vested during 2013, valued at $0.82/share

 

 

-

 

 

 

-

 

 

 

13,531

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

13,531

 

Options issued for services in November 2011, vested during 2013, valued at $0.53/share

 

 

-

 

 

 

-

 

 

 

26,232

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

26,232

 

Options issued for services in December 2011, vested during 2013, valued at $0.82/share

 

 

-

 

 

 

-

 

 

 

51,252

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

51,252

 

Options issued for services in March 2012, vested during 2013, valued at $1.69/share

 

 

-

 

 

 

-

 

 

 

29,154

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

29,154

 

Options issued for services in May 2012, vested during 2013, valued at $1.23/share

 

 

-

 

 

 

-

 

 

 

151,350

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

151,350

 

Warrants issued for services in May 2012, vested during 2013, valued at $0.97/share

 

 

-

 

 

 

-

 

 

 

41,738

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

41,738

 

Options issued for services in June 2012, vested during 2013, valued at $0.73/share

 

 

-

 

 

 

-

 

 

 

36,287

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

36,287

 

Options issued for services in August 2012, vested during 2013, valued at $0.74/share

 

 

-

 

 

 

-

 

 

 

37,242

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

37,242

 

Options issued for services in August 2012, vested during 2013, valued at $0.75/share

 

 

-

 

 

 

-

 

 

 

6,920

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

6,920

 

Warrants issued for services in December 2012, vested during 2013, valued at $0.78/share

 

 

-

 

 

 

-

 

 

 

69,455

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

69,455

 

Options issued for services in March 2013, vested during 2013, valued at $1.08/share

 

 

-

 

 

 

-

 

 

 

33,986

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

33,986

 

Options issued for services in May 2013, vested during 2013, valued at $0.96/share

 

 

-

 

 

 

-

 

 

 

2,394

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

2,394

 

Options issued for services in May 2013, vested during 2013, valued at $0.81/share

 

 

-

 

 

 

-

 

 

 

60,399

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

60,399

 

Warrants issued for services in July 2013, vested during 2013, valued at $0.49/share

 

 

-

 

 

 

-

 

 

 

24,658

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

24,658

 

Options issued for services in August 2013, vested during 2013, valued at $0.71/share

 

 

-

 

 

 

-

 

 

 

46,337

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

46,337

 

Options issued for services in November 2013, vested during 2013, valued at $0.87/share

 

 

-

 

 

 

-

 

 

 

50,801

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

50,801

 

Net loss for the year ending December 31, 2013

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(3,912,326

)

 

 

(3,912,326

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BALANCE AT DECEMBER 31, 2013

 

 

52,617,789

 

 

$

52,618

 

 

$

35,414,206

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

(15,827

)

 

$

(32,328,365

)

 

$

3,122,632

 


See accompanying notes to these financial statements.




10




LIGHTWAVE LOGIC, INC.

(A Development Stage Company)

STATEMENT OF STOCKHOLDERS’ EQUITY

FOR THE PERIOD JANUARY 1, 2004 (INCEPTION OF DEVELOPMENT STAGE) TO

MARCH 31, 2014 (CONTINUED)

(UNAUDITED)


 

 

 

 

 

 

 

 

 

 

 

Subscription

 

 

 

 

 

 

 

 

 

 

 

Deficit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Receivable/

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Receivable

 

 

 

 

 

Unrealized

 

 

 

 

 

During

 

 

 

 

 

 

Number of

 

 

Common

 

 

Paid-in

 

 

for Issuance

 

 

Deferred

 

 

Loss

 

 

Accumulated

 

 

Development

 

 

 

 

 

 

Shares

 

 

Stock

 

 

Capital

 

 

of Common Stock

 

 

Charges

 

 

on Securities

 

 

Deficit

 

 

Stage

 

 

Total

 

 

  

                    

 

 

                 

 

 

                   

 

 

                             

 

 

                    

 

 

                      

 

 

                      

 

 

                       

 

 

                    

 

BALANCE AT DECEMBER 31, 2013

 

 

52,617,789

 

 

$

52,618

 

 

$

35,414,206

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

(15,827

)

 

$

(32,328,365

)

 

$

3,122,632

 

  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock issued to institutional investor, valued at $0.8883/share

 

 

200,000

 

 

 

200

 

 

 

177,460

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

177,660

 

Common stock issued for additional commitment shares, valued at $1.03/share

 

 

1,340

 

 

 

2

 

 

 

1,379

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,381

 

Common stock issued for additional commitment shares, valued at $1.016/share

 

 

1,340

 

 

 

1

 

 

 

1,361

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,362

 

Exercise of options at $0.25/share

 

 

10,000

 

 

 

10

 

 

 

2,490

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

2,500

 

Exercise of warrants at $0.345/share

 

 

250,000

 

 

 

250

 

 

 

86,000

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

86,250

 

Options issued for services in May 2011, vested during 2013, valued at $0.97/share

 

 

-

 

 

 

-

 

 

 

11,929

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

11,929

 

Options issued for services in November 2011, vested during 2013, valued at $0.53/share

 

 

-

 

 

 

-

 

 

 

6,468

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

6,468

 

Options issued for services in December 2011, vested during 2013, valued at $0.82/share

 

 

-

 

 

 

-

 

 

 

12,638

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

12,638

 

Options issued for services in June 2012, vested during 2013, valued at $0.73/share

 

 

-

 

 

 

-

 

 

 

8,948

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

8,948

 

Options issued for services in August 2012, vested during 2013, valued at $0.74/share

 

 

-

 

 

 

-

 

 

 

3,012

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,012

 

Options issued for services in March 2013, vested during 2013, valued at $1.08/share

 

 

-

 

 

 

-

 

 

 

9,996

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

9,996

 

Options issued for services in May 2013, vested during 2013, valued at $0.81/share

 

 

-

 

 

 

-

 

 

 

20,201

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

20,201

 

Warrants issued for services in July 2013, vested during 2013, valued at $0.49/share

 

 

-

 

 

 

-

 

 

 

12,061

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

12,061

 

Options issued for services in August 2013, vested during 2013, valued at $0.71/share

 

 

-

 

 

 

-

 

 

 

7,139

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

7,139

 

Options issued for services in November 2013, vested during 2013, valued at $0.87/share

 

 

-

 

 

 

-

 

 

 

10,733

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

10,733

 

Warrants issued for services in January 2014, vested during 2014, valued at $0.53/share

 

 

-

 

 

 

-

 

 

 

13,146

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

13,146

 

Options issued for services in January 2014, vested during 2014, valued at $0.59/share

 

 

-

 

 

 

-

 

 

 

70,396

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

70,396

 

Options issued for services in March 2014, vested during 2014, valued at $0.74/share

 

 

-

 

 

 

-

 

 

 

7,152

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

7,152

 

Options issued for services in March 2014, vested during 2014, valued at $0.77/share

 

 

-

 

 

 

-

 

 

 

11,612

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

11,612

 

Options issued for services in March 2014, vested during 2014, valued at $0.74/share

 

 

-

 

 

 

-

 

 

 

5,364

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

5,364

 

Options issued for services in March 2014, vested during 2014, valued at $0.78/share

 

 

-

 

 

 

-

 

 

 

5,046

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

5,046

 

Warrants issued for services in March 2014, vested during 2014, valued at $0.67/share

 

 

-

 

 

 

-

 

 

 

5,318

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

5,318

 

Net loss for the three months ending March 31, 2014

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(987,851

)

 

 

(987,851

)

  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BALANCE AT MARCH 31, 2014

 

 

53,080,469

 

 

$

53,081

 

 

$

35,904,055

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

(15,827

)

 

$

(33,316,216

)

 

$

2,625,093

 



See accompanying notes to these financial statements.





11



LIGHTWAVE LOGIC, INC.

(A Development Stage Company)

STATEMENTS OF CASH FLOW

FOR THE THREE MONTHS ENDING MARCH 31, 2014 AND 2013 AND

FOR THE PERIOD JANUARY 1, 2004 (INCEPTION OF DEVELOPMENT STAGE) TO

MARCH 31, 2014

(UNAUDITED)


 

 

Cumulative

 

 

For the Three Months Ending

 

  

 

Since

 

 

March 31,

 

  

 

Inception

 

 

2014

 

 

2013

 

CASH FLOWS FROM OPERATING ACTIVITIES

  

                       

  

  

                       

  

  

                       

  

Net loss

 

$

(33,316,216

)

 

$

(987,851

)

 

$

(922,471

)

Adjustment to reconcile net loss to net cash used in operating activities

 

 

 

 

 

 

 

 

 

 

 

 

Amortization of deferred charges

 

 

4,392,456

 

 

 

-

 

 

 

-

 

Amortization of prepaid expenses

 

 

75,000

 

 

 

-

 

 

 

-

 

Warrants issued for services

 

 

4,225,149

 

 

 

30,525

 

 

 

38,934

 

Stock options issued for services

 

 

7,655,339

 

 

 

190,634

 

 

 

230,990

 

Common stock issued for services and fees

 

 

1,671,190

 

 

 

2,743

 

 

 

19,550

 

Purchase right agreement amortization

 

 

132,058

 

 

 

-

 

 

 

-

 

Depreciation and amortization of patents

 

 

383,341

 

 

 

33,924

 

 

 

26,328

 

Realized gain on investments

 

 

(3,911

)

 

 

-

 

 

 

-

 

Realized gain on disposal of assets

 

 

(637

)

 

 

-

 

 

 

-

 

(Increase) decrease in assets

 

 

 

 

 

 

 

 

 

 

 

 

Receivables

 

 

(30,461

)

 

 

-

 

 

 

-

 

Prepaid expenses and other current assets

 

 

(112,850

)

 

 

19,354

 

 

 

14,868

 

Increase (decrease) in liabilities

 

 

 

 

 

 

 

 

 

 

 

 

Accounts payable

 

 

328,331

 

 

 

130,006

 

 

 

29,067

 

Accounts payable and accrued expenses- related parties

 

 

(23,874

)

 

 

18,235

 

 

 

20,181

 

Accrued expenses

 

 

127,709

 

 

 

42,220

 

 

 

6,400

 

Net cash used in operating activities

 

 

(14,497,376

)

 

 

(520,210

)

 

 

(536,153

)

  

 

 

 

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES

 

 

 

 

 

 

 

 

 

 

 

 

Cost of intangibles

 

 

(621,658

)

 

 

(28,748

)

 

 

(10,722

)

Proceeds from sale of available for sale securities

 

 

203,911

 

 

 

-

 

 

 

-

 

Proceeds from receipt of note receivable

 

 

100,000

 

 

 

-

 

 

 

-

 

Purchase of available for sale securities

 

 

(200,000

)

 

 

-

 

 

 

-

 

Purchase of equipment, furniture and leasehold improvements

 

 

(619,216

)

 

 

(58,059

)

 

 

(86,371

)

Net cash used in investing activities

 

 

(1,136,963

)

 

 

(86,807

)

 

 

(97,093

)

  

 

 

 

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES

 

 

 

 

 

 

 

 

 

 

 

 

Issuance of common stock, private placement

 

 

7,495,524

 

 

 

-

 

 

 

-

 

Common stock rescinded, private placement

 

 

(200,000

)

 

 

-

 

 

 

-

 

Issuance of common stock, exercise of options and warrants

 

 

2,182,662

 

 

 

88,750

 

 

 

15,625

 

Issuance of common stock, exercise of purchase right agreement

 

 

45,138

 

 

 

-

 

 

 

-

 

Issuance of common stock, institutional investor

 

 

7,506,159

 

 

 

177,660

 

 

 

1,000,000

 

Repayment of notes payable

 

 

(14,970

)

 

 

-

 

 

 

-

 

Proceeds from subscription receivable

 

 

19,000

 

 

 

-

 

 

 

-

 

Advances to stockholders

 

 

(4,933

)

 

 

-

 

 

 

-

 

Proceeds from convertible notes

 

 

529,000

 

 

 

-

 

 

 

-

 

Advances from officers

 

 

1,498

 

 

 

-

 

 

 

-

 

Net cash provided by financing activities

 

 

17,559,078

 

 

 

266,410

 

 

 

1,015,625

 

  

 

 

 

 

 

 

 

 

 

 

 

 

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS

 

 

1,924,739

 

 

 

(340,607

)

 

 

382,379

 

  

 

 

 

 

 

 

 

 

 

 

 

 

CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD

 

 

5,358

 

 

 

2,270,704

 

 

 

2,936,879

 

  

 

 

 

 

 

 

 

 

 

 

 

 

CASH AND CASH EQUIVALENTS - END OF PERIOD

 

$

1,930,097

 

 

$

1,930,097

 

 

$

3,319,258

 


See accompanying notes to these financial statements.




12




LIGHTWAVE LOGIC, INC.

(A Development Stage Company)

STATEMENTS OF CASH FLOW

FOR THE THREE MONTHS ENDING MARCH 31, 2014 AND 2013 AND

FOR THE PERIOD JANUARY 1, 2004 (INCEPTION OF DEVELOPMENT STAGE) TO

MARCH 31, 2014 (CONTINUED)

(UNAUDITED)


  

 

Cumulative

 

 

For the Three Months Ending

 

  

 

Since

 

 

March 31,

 

  

 

Inception

 

 

2014

 

 

2013

 

  

  

                       

  

  

                       

  

  

                       

  

  

 

 

 

 

 

 

 

 

 

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

 

 

CASH PAID DURING THE PERIOD FOR:

 

 

 

 

 

 

 

 

 

Interest

 

$

23,341

 

 

$

-

 

 

$

-

 

  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES

 

 

 

 

 

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

 

 

 

 

 

Common stock issued in exchange for deferred charges

 

$

3,142,400

 

 

$

-

 

 

$

-

 

  

 

`

 

 

 

 

 

 

 

 

 

Warrants issued in exchange for deferred charges

 

$

1,581,056

 

 

 

 

 

 

$

-

 

  

 

 

 

 

 

 

 

 

 

 

 

 

Common stock issued as settlement for accounts payable

 

$

74,708

 

 

$

-

 

 

$

-

 

  

 

 

 

 

 

 

 

 

 

 

 

 

Accrued interest contributed as capital

 

$

35,624

 

 

$

-

 

 

$

-

 

  

 

 

 

 

 

 

 

 

 

 

 

 

Common stock issued in the conversion of notes payable

 

$

529,000

 

 

$

-

 

 

$

-

 

  

 

 

 

 

 

 

 

 

 

 

 

 

Acquisition of automobile through loan payable

 

$

24,643

 

 

$

-

 

 

$

-

 

  

 

 

 

 

 

 

 

 

 

 

 

 

Common stock issued upon exercise of a warrant

 

 

 

 

 

 

 

 

 

 

 

 

    in exchange for receivable

 

$

75,000

 

 

$

-

 

 

$

-

 

  

 

 

 

 

 

 

 

 

 

 

 

 

Insurance company pay off of note payable

 

$

9,673

 

 

$

-

 

 

$

-

 

  

 

 

 

 

 

 

 

 

 

 

 

 

Receivable for issuance of common stock

 

$

210,001

 

 

$

-

 

 

$

-

 

  

 

 

 

 

 

 

 

 

 

 

 

 

Contribution of officer accrued payroll

 

$

52,129

 

 

$

-

 

 

$

-

 

  

 

 

 

 

 

 

 

 

 

 

 

 

Common stock issued for prepaid expense

 

$

75,000

 

 

$

-

 

 

$

-

 


See accompanying notes to these financial statements.




13



LIGHTWAVE LOGIC, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

MARCH 31, 2014 AND 2013



NOTE 1- FINANCIAL STATEMENTS


The accompanying unaudited financial statements have been prepared by Lightwave Logic, Inc. (the Company).  These statements include all adjustments (consisting only of its normal recurring adjustments) which management believes necessary for a fair presentation of the statements and have been prepared on a consistent basis using the accounting polices described in the Summary of Accounting Policies included in the 2013 Annual Report.  Certain financial information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to those rules and regulations, although the Company firmly believes that the accompanying disclosures are adequate to make the information presented not misleading.  The financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013, as filed with the Securities and Exchange Commission.  The interim operating results for the three months ending March 31, 2014 may not be indicative of operating results expected for the full year.


Loss Per Share

 

The Company follows Financial Accounting Standards Board Accounting Standards Codification (“FASB ASC”) 260, “Earnings per Share”, resulting in the presentation of basic and diluted earnings per share.  Because the Company reported a net loss in 2014 and 2013, common stock equivalents, including stock options and warrants were anti-dilutive; therefore, the amounts reported for basic and dilutive loss per share were the same.

 

Comprehensive Income


The Company follows FASB ASC 220.10, “Reporting Comprehensive Income.”  Comprehensive income is a more inclusive financial reporting methodology that includes disclosure of certain financial information that historically has not been recognized in the calculation of net income.  Since the Company has no items of other comprehensive income, comprehensive income (loss) is equal to net loss.


Recently Adopted Accounting Pronouncements


As of March 31, 2014 and for the period then ended, there were no recently adopted accounting pronouncements that had a material effect on the Company’s financial statements.


Recently Issued Accounting Pronouncements Not Yet Adopted


As of March 31, 2014, there are no recently issued accounting standards not yet adopted which would have a material effect on the Company’s financial statements.




14



LIGHTWAVE LOGIC, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

MARCH 31, 2014 AND 2013




NOTE 2 – MANAGEMENT’S PLANS


As a development stage company, substantial net losses have been incurred since inception.  The Company has satisfied capital requirements since inception primarily through the issuance and sale of its common stock.  In June 2013, the Company signed an agreement with an institutional investor to sell up to $20 million of common stock. Under the agreement subject to certain conditions and at the Company's sole discretion, the institutional investor has committed to invest up to $20 million in the Company's common stock over a 30-month period with the remaining available amount of $19,343,840.  The Company filed a registration statement with the U.S. Securities and Exchange Commission covering the resale of the shares that may be issued to the institutional investor.  The institutional investor is obligated to make purchases as the Company directs in accordance with the agreement that may be terminated by the Company at any time, without cost or penalty.  Sales of shares will be made in specified amounts and at prices that are based upon the market prices of the Company's common stock.   Management believes the Company has raised sufficient capital to finance its operations through October 2014.  Additional funding may also be provided by the exercise of 1,191,000 outstanding options and warrants expiring during 2014 at an exercise price of $0.34 and $0.72, which may raise additional capital up to approximately $787,000.  Also, historically the Company has successfully raised sufficient cash to fund its operations.  The Company continues to develop and test its next generation Electro-Optic and third-order material platform to support and cultivate potential customers, strategic partners and develop photonic devices.  Management believes the Company’s initial revenue stream will be in prototype devices, application and non-recurring engineering charges, and material charges for specialty non-linear application prior to moving into full commercialization and production.  However, there can be no assurances that the Company will achieve an adequate sales level or meet all the conditions to obligate the institutional investor to make purchases.  The Company has incurred significant losses and experienced negative cash flow during the development stage.  If these conditions continue beyond the next five months and if the Company is unable to raise capital, it will raise substantial doubt about the Company’s ability to continue as a going concern.  The financial statements do not include any adjustments that might result from the outcome of this uncertainty.


NOTE 3 –EQUIPMENT


Equipment consists of the following:


 

 

March 31,

2014

 

 

December 31,

2013

 

  

 

 

 

 

 

 

Office equipment

 

$

33,899

 

 

$

24,244

 

Lab equipment

 

 

489,221

 

 

 

474,049

 

Furniture

 

 

17,022

 

 

 

4,061

 

Leasehold Improvements

 

 

57,790

 

 

 

37,519

 

  

 

 

597,932

 

 

 

539,873

 

Less: Accumulated depreciation

 

 

271,722

 

 

 

241,513

 

  

 

 

 

 

 

 

 

 

  

 

$

326,210

 

 

$

298,360

 


Depreciation expense for the three months ending March 31, 2014 and 2013 was $30,209 and $22,613.




15



LIGHTWAVE LOGIC, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

MARCH 31, 2014 AND 2013




NOTE 4 – INTANGIBLE ASSETS


This represents legal fees and patent fees associated with the prosecution of patent applications.  The Company has recorded amortization expenses on the Spacer and Chromophore patents granted by the United States Patent and Trademark Office in February 2011, April 2011 and September 2012, which are amortized over its legal life of 20 years and Chromophore patent granted by the Australian Patent Office in November 2012 which is amortized over its legal life of 20 years.  Certain patent applications are abandoned by the Company when the claims are covered by patents already granted to the Company.  Patent applications abandoned have been written off at full capitalized cost.  No amortization expense has been recorded on the remaining patent applications since patents have yet to be granted.  Once the patents are granted, the cost of the patents will be amortized over their legal lives, which is generally 20 years.


Patents consists of the following:


 

 

March 31,

2014

 

 

December 31,

2013

 

  

 

 

 

 

 

 

Patents

 

$

607,984

 

 

$

579,235

 

Less: Accumulated amortization

 

 

39,411

 

 

 

35,695

 

  

 

 

 

 

 

 

 

 

  

 

$

568,573

 

 

$

543,540

 


Amortization expense for the three months ending March 31, 2014 and 2013 was $3,715 and $3,715.  Expense for abandoned patents for claims covered by patents already granted to the Company are recorded in research and development expenses and for the three months ending March 31, 2014 and 2013 were $0 and $0.


NOTE 5 – INCOME TAXES


There is no income tax benefit for the losses for the three months ended March 31, 2014 and 2013 since management has determined that the realization of the net deferred tax asset is not assured and has created a valuation allowance for the entire amount of such benefits.


The Company’s policy is to record interest and penalties associated with unrecognized tax benefits as additional income taxes in the statement of operations.  As of January 1, 2014, the Company had no unrecognized tax benefits, or any tax related interest of penalties.  There were no changes in the Company’s unrecognized tax benefits during the period ended March 31, 2014.  The Company did not recognize any interest or penalties during 2014 related to unrecognized tax benefits.  With few exceptions, the U.S. and state income tax returns filed for the tax years ending on December 31, 2010 and thereafter are subject to examination by the relevant taxing authorities.







16



LIGHTWAVE LOGIC, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

MARCH 31, 2014 AND 2013




NOTE 6 – STOCKHOLDERS’ EQUITY


Preferred Stock

Pursuant to the Company’s Articles of Incorporation, the Company’s board of directors is empowered, without stockholder approval, to issue series of preferred stock with any designations, rights and preferences as they may from time to time determine.  The rights and preferences of this preferred stock may be superior to the rights and preferences of the Company’s common stock; consequently, preferred stock, if issued could have dividend, liquidation, conversion, voting or other rights that could adversely affect the voting power or other rights of the common stock.  Additionally, preferred stock, if issued, could be utilized, under special circumstances, as a method of discouraging, delaying or preventing a change in control of the Company’s business or a takeover from a third party.


Common Stock and Warrants

In January 2009, an employee was granted with an option to purchase up to 25,000 shares of common stock at a purchase price of $.25 per share.  Using the Black-Scholes Option Pricing Formula, the options were valued at $13,136, fair value. These options expire in 5 years and vest immediately. The expense recognized during 2009 is $13,136. In May 2010, the option was partially exercised to purchase 15,000 shares of common stock for proceeds of $3,750.  In January 2014, the remaining 10,000 options were exercised to purchase 10,000 shares of common stock for proceeds of $2,500.


During June 2009, the Company issued a warrant to purchase 464,000 shares of common stock at a purchase price of $0.34 per share for accounting services rendered.  The warrant was valued at $391,342 using the Black-Scholes Option Pricing Formula, vesting 46,400 immediately and the remaining on equal monthly installments of 23,200 over the next eighteen months.  The warrant expires in 5 years.  The expense is being recognized based on service terms of the agreement over a twenty two month period.  The expense recognized during 2010 and 2009 is $213,459 and $177,883.  In April 2010, the warrant was partially exercised to purchase 10,000 shares of common stock for proceeds of $3,450. In February 2012, the warrant was partially exercised to purchase 20,000 shares of common stock for proceeds of $6,900.  In June 2013, the warrant was partially exercised to purchase 20,000 shares of common stock for proceeds of $6,900.  In March 2014, warrants were exercised to purchase 250,000 shares of common stock for proceeds of $86,250.  As of March 31, 2014, warrants to purchase 164,000 shares of common stock are still outstanding.


In January 2011, the Company issued a warrant to a related party to purchase 10,000 shares of common stock for legal services at an exercise price of $1.25 per share. Using the Black-Scholes Option Pricing Formula, the warrants were valued at $10,453, fair value.  These warrants expire in 3 years and vest immediately.  The expense recognized during 2011 is $10,453.  In January 2014, the warrant to purchase 10,000 shares of common stock forfeited.


In August 2012, the board of directors approved a grant to a new employee of an option to purchase up to 100,000 shares of common stock at a purchase price of $0.925 per share. Using the Black-Scholes Option Pricing Formula, the option was valued at $74,486, fair value. The option expires in 5 years with 12,500 vesting every 3 months from date of grant.  The option is expensed over the vesting terms.  For the years ending December 31, 2013 and 2012, the Company recognized $37,242 and $15,611 of expense.  For the three months ending March 31, 2014 and 2013, the Company recognized $3,012 and $9,183 of expense.  In February 2014, the option to purchase 25,000 shares of common stock forfeited.  As of March 31, 2014, options to purchase 75,000 shares of common stock are still outstanding.





17



LIGHTWAVE LOGIC, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

MARCH 31, 2014 AND 2013




NOTE 6 – STOCKHOLDERS’ EQUITY (CONTINUED)


Common Stock and Warrants (Continued)


In May 2013, the board of directors approved a grant to a new employee of an option to purchase up to 10,000 shares of common stock at a purchase price of $1.03 per share. Using the Black-Scholes Option Pricing Formula, the option was valued at $9,574, fair value. The option expires in 10 years with 1,250 vesting quarterly from date of grant.  The option is expensed over the vesting terms.  In December 2013, the option to purchase 7,500 shares of common stock forfeited.  For the year ending December 31, 2013, the Company recognized a net expense of $2,394.  For the three months ending March 31, 2014, the Company recognized $0 of expense.  As of December 31, 2013, options to purchase 2,500 shares of common stock are still outstanding.   In March 2014, the options to purchase 2,500 shares of common stock forfeited.


In June 2013, the Company signed a Purchase Agreement and Registration Rights Agreement with an institutional investor to sell up to $20 million of common stock. Under the agreement subject to certain conditions and at the Company's sole discretion, the institutional investor has committed to invest up to $20 million in the Company's common stock over a 30-month period.  The Company filed the registration statement with the U.S. Securities and Exchange Commission in September 2013.  The institutional investor is obligated to make purchases as the Company directs in accordance with the agreement, which may be terminated by the Company at any time, without cost or penalty.  Sales of shares will be made in specified amounts and at prices that are based upon the market prices of the Company's common stock immediately preceding the sales to the institutional investor.  The Company issued 200,000 shares of restricted common stock to the institutional investor as an initial commitment fee valued at $170,000, fair value and 400,000 shares of common stock are reserved for additional commitment fees to the institutional investor in accordance with the terms of the agreement.  During June 2013 through March 2014, the institutional investor purchased 700,000 shares of common stock for proceeds of $656,160 and the Company issued 10,322 shares of common stock as additional commitment fee, valued at $10,623, fair value, leaving 389,678 in reserve for additional commitment fees.  For the three months ending March 31, 2014, the institutional investor purchased 200,000 shares of common stock for proceeds of $177,660 and the Company issued 2,680 shares of common stock as additional commitment fee, valued at $2,741, fair value.


In December 2013, the board of directors approved a grant to a senior advisor effective January 2014 of a warrant to purchase up to 100,000 shares of common stock at a purchase price of $0.715 per share.  Using the Black-Scholes Option Pricing Formula, the warrant was valued at $53,313, fair value. The warrant expires in 5 years and vests 25,000 immediately and the remaining in equal monthly installments of 7,500 over the next 10 months.  The warrant is expensed over the vesting terms.  For the three month ending March 31, 2014, the Company recognized $13,146 of expense.  As of March 31, 2014, the warrants to purchase 100,000 shares of common stock are still outstanding.


In January 2014, the Company issued options to the Company’s 4 independent directors to each purchase 50,000 shares of common stock at a purchase price of $0.715 per share.  The options were each valued at $29,440, fair value, using the Black-Scholes Option Pricing Formula.  The options expire in 10 years with 20,000 vesting immediately and the remainder vesting in quarterly equal installments of 10,000 commencing April 1, 2014.  The options are expensed over the vesting terms.  For the three month ending March 31, 2014, the Company recognized $70,396 of expense.  As of March 31, 2014, the options to purchase 200,000 shares of common stock are still outstanding.







18



LIGHTWAVE LOGIC, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

MARCH 31, 2014 AND 2013




NOTE 6 – STOCKHOLDERS’ EQUITY (CONTINUED)


Common Stock and Warrants (Continued)


In March 2014, the Company issued options to a new employee to purchase 30,000 shares of common stock at a purchase price of $0.92 per share.  The options were valued at $23,304, fair value, using the Black-Scholes Option Pricing Formula.  The options expire in 10 years vesting in quarterly equal installments of 3,750 from date of employment.  The options are expensed over the vesting terms.  For the three month ending March 31, 2014, the Company recognized $1,073 of expense.  As of March 31, 2014, the options to purchase 30,000 shares of common stock are still outstanding.


In March 2014, the Company issued options to a new employee to purchase 75,000 shares of common stock at a purchase price of $0.92 per share.  The options were valued at $58,384, fair value, using the Black-Scholes Option Pricing Formula.  The options expire in 10 years vesting in quarterly equal installments of 9,375 from date of employment.  The options are expensed over the vesting terms.  For the three month ending March 31, 2014, the Company recognized $2,492 of expense.  As of March 31, 2014, the options to purchase 75,000 shares of common stock are still outstanding.


In March 2014, the Company issued options to a new employee to purchase 50,000 shares of common stock at a purchase price of $0.92 per share.  The options were valued at $38,922, fair value, using the Black-Scholes Option Pricing Formula.  The options expire in 10 years vesting in quarterly equal installments of 6,250 from date of employment.  The options are expensed over the vesting terms.  For the three month ending March 31, 2014, the Company recognized $1,481 of expense.  As of March 31, 2014, the options to purchase 50,000 shares of common stock are still outstanding.


In March 2014, the Company issued options to an employee to purchase 125,000 shares of common stock at a purchase price of $0.92 per share.  The options were valued at $96,211, fair value, using the Black-Scholes Option Pricing Formula.  The options expire in 10 years vesting in quarterly equal installments of 15,625 commencing April 1, 2014.  The options are expensed over the vesting terms.  For the three month ending March 31, 2014, the Company recognized $11,612 of expense.  As of March 31, 2014, the options to purchase 125,000 shares of common stock are still outstanding.


In March 2014, the Company issued options to an employee to purchase 30,000 shares of common stock at a purchase price of $0.92 per share.  The options were valued at $22,222, fair value, using the Black-Scholes Option Pricing Formula.  The options expire in 10 years vesting in quarterly equal installments of 7,500 commencing April 1, 2014.  The options are expensed over the vesting terms.  For the three month ending March 31, 2014, the Company recognized $5,364 of expense.  As of March 31, 2014, the options to purchase 30,000 shares of common stock are still outstanding.


In March 2014, the Company issued options to purchase 40,000 shares of common stock at a purchase price of $0.92 per share to its Chief Executive Officer as part of a new employment agreement.  The options were valued at $29,630, fair value, using the Black-Scholes Option Pricing Formula.  The options expire in 10 years vesting in quarterly equal installments of 10,000 commencing April 1, 2014.  The options are expensed over the vesting terms.  For the three month ending March 31, 2014, the Company recognized $7,152 of expense.  As of March 31, 2014, the options to purchase 40,000 shares of common stock are still outstanding.









19



LIGHTWAVE LOGIC, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

MARCH 31, 2014 AND 2013




NOTE 6 – STOCKHOLDERS’ EQUITY (CONTINUED)


Common Stock and Warrants (Continued)


In March 2014, the Company issued warrants to purchase 100,000 shares of common stock for consulting services at an exercise price of $0.92 per share.  The warrants were valued at $66,936, fair value, using the Black-Scholes Option Pricing Formula.  The warrants expire in 5 years vesting 25,000 immediately with the remaining 75,000 vesting in monthly equal installments of 7,500 commencing April 1, 2014.  The warrants are expensed over the vesting terms.  For the three month ending March 31, 2014, the Company recognized $5,318 of expense.  As of March 31, 2014, the warrants to purchase 100,000 shares of common stock are still outstanding.


NOTE 7 – STOCK BASED COMPENSATION


The Company uses the Black-Scholes option pricing model to calculate the grant-date fair value of an award, with the following assumptions for 2014: no dividend yield, expected volatility, based on the Company’s historical volatility, 96% to 109%, risk-free interest rate 1.46% to 2.08% and expected option life of 5 to 7.25 years.


As of March 31, 2014, there was $651,493 of unrecognized compensation expense related to non-vested market-based share awards that is expected to be recognized through October 2016.


The following tables summarize all stock option and warrant activity of the Company during the three months ended March 31, 2014:


 

 

Non-Qualified Stock Options and Warrants
Outstanding and Exercisable

 

  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted

 

 

 

 

 

 

 

 

 

Average

 

  

 

Number of

 

 

Exercise

 

 

Exercise

 

  

 

Shares

 

 

Price

 

 

Price

 

  

 

 

 

 

 

 

 

 

 

Outstanding, December 31, 2013

 

 

7,146,000

 

 

$0.25 - $1.75

 

 

$

1.16

 

  

 

 

 

 

 

 

 

 

 

 

 

 

Granted

 

 

750,000

 

 

$0.72 - $0.92

 

 

$

0.84

 

Expired

 

 

(10,000

)

 

$1.25

 

 

$

1.25

 

Forfeited

 

 

(27,500

)

 

$0.93 - $1.03

 

 

$

0.93

 

Exercised

 

 

(260,000

)

 

$0.25 - $0.35

 

 

$

0.34

 

  

 

 

 

 

 

 

 

 

 

 

 

 

Outstanding, March 31, 2014

 

 

7,598,500

 

 

$0.34 - $1.75

 

 

$

1.15

 

  

 

 

 

 

 

 

 

 

 

 

 

 

Exercisable, March 31, 2014

 

 

6,495,997

 

 

$0.34 - $1.75

 

 

$

1.20

 


Non-Qualified Stock Options and Warrants Outstanding

  

  

Number Outstanding

  

Weighted Average

  

Weighted Average

Range of

  

Currently Exercisable

  

Remaining

  

Exercise Price of Options and

Exercise Prices

  

at March 31, 2014

  

Contractual Life

  

Warrants Currently Exercisable

  

  

  

  

  

  

  

$0.34 - $1.75

  

6,495,997

  

3.25 Years

  

$1.20



 



20



LIGHTWAVE LOGIC, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

MARCH 31, 2014 AND 2013




NOTE 8 – RELATED PARTY


At March 31, 2014 the Company had accrued salaries to two beneficial owners of $42,088, legal accrual to related party of $23,000 and travel and office expense accruals of officers in the amount of $1,964.  At December 31, 2013 the Company had accrued salaries to two beneficial owners of $42,088, legal accrual to related party of $5,500 and travel and office expense accruals of officers in the amount of $1,229.


NOTE 9 – RETIREMENT PLAN


During 2013, the Company established a 401(k) retirement plan covering all eligible employees beginning November 15, 2013.  There were no contributions charged to expense.


NOTE 10 – SUBSEQUENT EVENTS


In May 2014, the Company issued options to a new director to purchase 200,000 shares of common stock at a purchase price of $0.763 per share.  The options were valued at $122,515 using the Black-Scholes Option Pricing Formula. The options expire in 10 years with 50,000 vesting immediately and the remainder vesting in annual equal installments of 50,000 commencing on the one year anniversary of the date of grant. The options are expensed over the vesting terms.


 






21






Item 2

Management's Discussion and Analysis of Financial Condition and Results of Operations


The following management’s discussion and analysis of financial condition and results of operations   provides information that management believes is relevant to an assessment and understanding of our plans and financial condition. The following selected financial information is derived from our historical financial statements and should be read in conjunction with such financial statements and notes thereto set forth elsewhere herein and the "Forward-Looking Statements" explanation included herein.


Overview

 

Lightwave Logic, Inc. (the “ Company ”) is a development stage, electro-optical device and organic nonlinear materials company. Our primary area of expertise is the chemical synthesis of chromophore dyes used in the development of organic Application Specific Electro-Optic Polymers (ASEOP) and Organic Non-Linear All-Optical Polymers (NLAOP) that have high electro-optic and optical activity. Our family of materials are thermally and photo-chemically stable, which we believe could have utility across a broad range of applications in devices that address markets like, telecommunication, data communications, high-speed computing and photovoltaic cells. Secondarily, the Company is developing proprietary electro-optical and all-optical devices utilizing the advanced capabilities of our materials for the application in the fields mentioned above.

 

In order to transmit digital information at extremely high-speeds (wide bandwidth) over the Internet, it is necessary to convert the electrical signals produced by a computer into optical signals for transmission over long-distance fiber-optic cable.   Molecularly engineered materials known as electro-optic polymers when designed into optical devices perform the actual conversion of an electrical signal to an optical signal.

 

We are currently developing electro-optic polymers that promise performance many times faster than any technology currently available and that have unprecedented thermal stability. High-performance electro-optic materials produced by our Company have demonstrated stability as high as 350 degrees Celsius.  Stability above 250 degrees Celsius is necessary for vertical integration into many semi-conductor production lines. In December 2011 one of our non-linear optical polymers, Perkinamine Indigo TM  demonstrated an unusually high electro-optical effect of greater than 250 picometers per volt on 1.5-micron films with excellent thermal and photo stability. Independent research laboratories at Photon-X and The University of Colorado confirmed these characteristics. We continued our development program on Perkinamine Indigo TM  to better understand the properties that gave us the results reported in December 2011.  More recent measurements have shown an electro-optical effect closer to 100 picometers per volt in a 500 nm thin films. We are continuing to perform development work to better understand these results. In January 2014 we created a new methodology to combine multiple chromophores into a single polymer host that will significantly improve their ability to generate more powerful organic, nonlinear electro-optical (EO) polymer systems. The new synthetic chemistry process can enable multiple chromophores (dyes) to work in concert with each other within a single polymer host.  This proprietary process has created two new material systems, which have demonstrated outstanding electro-optic values.  In addition, initial thermal stability results exceed any commercially available organic nonlinear polymer material systems.

 

Our non-linear all optical polymers have demonstrated resonantly enhanced third-order properties about 2,630 times larger than fused silica, which means that they are very photo-optically active in the absence of an RF layer.  In this way they differ from our electro-optical polymers and are considered more advanced next-generation materials.

 

Our revenue model relies substantially on the assumption that we will be able to successfully develop non-linear polymer materials and photonic device products, which will use non-linear all-optical and electro-optic polymers for applications within the industries named below. When appropriate, we intend to create specific materials for each of these applications and use our proprietary knowledge base to continue to enhance its discoveries.


·

telecommunications/data communications

·

backplane optical interconnects

·

cloud computing and data centers

·

photovoltaic cells

·

medical applications

·

satellite reconnaissance

·

navigation systems

·

radar applications

·

optical filters

·

spacial light modulators

·

all-optical transistors

·

entertainment



22





To be successful, we must, among other things:


·

Develop and maintain collaborative relationships with strategic partners;

·

Continue to expand our research and development efforts for our products;

·

Develop and continue to improve on our manufacturing processes and maintain stringent quality controls;

·

Produce commercial quantities of our products at commercially acceptable prices; 

·

Rapidly respond to technological advancements;

·

Attract, retain and motivate qualified personnel; and

·

Obtain and retain effective intellectual property protection for our products and technology.


We believe that Moore's Law (a principle which states the number of transistors on a silicon chip doubles approximately every eighteen months) will create markets for our high-performance electro-optic materials and photonic device products.

 

Plan of Operation

 

Since inception, we have been engaged primarily in the research and development of our polymer materials technologies and potential photonic device products. We are devoting significant resources to engineer next-generation electro-optic polymers for future applications to be utilized by electro-optic device manufacturers, such as telecommunications component and systems manufacturers, networking and switching suppliers, semiconductor companies, aerospace companies, government agencies and internal device development. We expect to continue to develop products that we intend to introduce to these rapidly changing markets and to seek to identify new markets. We expect to continue to make significant operating and capital expenditures for research and development activities.

 

As we move from a development stage company to a product supplier, we expect that our financial condition and results of operations will undergo substantial change. In particular, we expect to record both revenue and expense from product sales, to incur increased costs for sales and marketing and to increase general and administrative expense. Accordingly, the financial condition and results of operations reflected in our historical financial statements are not expected to be indicative of our future financial condition and results of operations.


Some of our more significant milestones that we achieved during 2013 and 2014 include:


In February 2013   we delivered to a potential large system supplier customer prototype devices that were coated with our advanced organic nonlinear electro-optical polymer, Perkinamine IndigoTM. Tests conducted by the University of Colorado, Boulder on coupons coated with the material demonstrated consistent R 33  measurements from 100-125 picometers per volt at 1550 nm, which as tested by the University of Colorado exceeded the potential large system supplier customer's stated requirements.

 

In March 2013   we entered into a product development contractor agreement with EM Photonics (EMP) of Newark, Delaware to   fabricate and test waveguides and phase modulators during an initial development phase using existing EMP polymer modulator design and processes. In June 2013 we   consolidated the EMP design program into our University of Colorado, Boulder (UCB) program after we fabricated structures with UCB that will be used as the basic building blocks of our Integrated Optical Device effort for the construction of both our advanced telecom modulator and data communications transceiver.   In August 2013 in a combined effort of the Company’s chemists, the University of Colorado, Boulder, and a third party research group we successfully fabricated Silicon Organic Hybrid (SOH) slot waveguide modulators.  The devices utilize an existing modulator structure with one of our proprietary electro-optic polymer material systems as the enabling material layer. In October 2013, we confirmed the functionality of the SOH slot waveguide modulators as operating devices. 

 

In April 2013 our  potential large system supplier customer informed us  that their preliminary testing results on the prototype devices coated with Perkinamine Indigo™ that we delivered to them in February 2013 demonstrated several of the key performance parameters that they desired. There are still additional tests that need to be completed.  We are working with our potential customer utilizing our Perkinamine family of chromophores in a number of host polymers and will evaluate these polymers in conjunction with our chromophores for a specific performance attributes for their application.

 

In April 2013 Japan granted our Company Japanese Patent No. 5241234 entitled Heterocyclical Chromophore Architectures.  This patent protects the unique molecular structures that give our chromophores the thermal stability necessary to withstand CMOS processing temperatures without compromising electro-optical effects.

 



23





In June 2013 we signed a new agreement with Lincoln Park Capital Fund, LLC (“Lincoln Park”) to sell up to $20 million of common stock.  Under the agreement subject to certain conditions and at our sole discretion, Lincoln Park has committed to invest up to $20 million in the Company’s common stock over a 30-month period.  In October 2013 the U.S. Securities and Exchange Commission declared effective our registration statement covering the resale of the shares that may be issued to Lincoln Park.  Sales of shares will be made in specified amounts and at prices that are based upon the market prices of our Company's common stock.

 

In August 2013   in a combined effort of the Company’s chemists, the University of Colorado, Boulder, and a third party research group we successfully fabricated Silicon Organic Hybrid (SOH) slot waveguide modulators. The devices utilize an existing modulator structure with one of our proprietary electro-optic polymer material systems as the enabling material layer. In October 2013 we confirmed the functionality of the SOH slot waveguide modulators as operating prototype devices. These first-generation devices have achieved greater electro-optical activity and dramatically lower drive voltage than industry standard modulators based on inorganic materials. 


In November 2013 preliminary testing and initial data on our   SOH slot waveguide modulators   demonstrated several promising characteristics. The tested SOH chip had a 1-millimeter square footprint, enabling the possibility of sophisticated integrated optical circuits on a single silicon substrate.  In addition, the waveguide structure was approximately 1/20 the length of a typical inorganic-based silicon photonics modulator waveguide.  With the combination of our proprietary electro-optic polymer material and the extremely high optical field concentration in the slot waveguide modulator, the test modulators demonstrated less than 2.2 volts to operate. Initial data rates exceeded 30-35 Gb/sec in the telecom, 1550 nanometer frequency band. This is equivalent to four, 10Gb/sec, inorganic, lithium niobate modulators that would require approximately 12-16 volts to move the same amount of information. Our material also operates in the 1310 nanometer frequency band, which is suitable for data communications applications. 

 

In February 2014 we received our first purchase order for our advanced organic nonlinear electro-optic (EO) polymer from Boulder Nonlinear Systems (BNS) of Boulder, Colorado in connection with the development of a next generation LADAR system. It is a radar system that utilizes a pulse laser to calculate the distance to a target, but is also capable of rendering a 3-D image.

 

In March 2014 we began the process of manufacturing an advanced design Silicon Organic Hybrid Transceiver prototype and have released the completed chip design to the OpSIS  Center at the University of Delaware  who will be producing initial silicon chips.  Delivery of the chips is expected in early summer 2014,  which will be used for qualification and testing . The OpSIS Center at the University of Delaware will be providing us with chips that we will process with various combinations of our electro-optic polymer systems.  The initial application will target inter-data center interconnections of more than 10 kilometers. Our next design will utilize a different frequency and address the current bottleneck in the rack-to-server layer.


In April 2014, we entered into a sole worldwide license agreement with Corning Incorporated enabling us to integrate Corning's organic electro-optical chromophores into our portfolio of electro-optic polymer materials.  The agreement allows us to use the licensed patents within a defined license field that includes communications, computing, power, and power storage applications utilizing the nonlinear optical properties of their materials.  As a result of obtaining this license agreement, we created a new powerful and durable nonlinear organic electro-optical (EO) material that will be used in photonic device development and is based on our new multi-chromophore approach that allows two or more chromophores to work in concert.  This multi-chromophore system has achieved a 50% increase in chromophore concentration, leading to higher electro-optical activity when compared to an equivalent single chromophore system.  Further, the system does not cause the high chromophore density loading issues such as reduced effective electro-optic activity due to a non-uniform concentration of chromophore in the polymer host.  Repeated, multi-point measurements multi-chromophore system shows twice the electro-optic effect of Lithium Niobate with excellent durability.

We ultimately intend to use our next-generation non-linear all-optical and electro-optic polymers for future applications vital to the following industries. We expect to create specific materials for each of these applications as appropriate:


·

telecommunications/data communications

·

backplane optical interconnects

·

cloud computing and data centers

·

photovoltaic cells

·

medical applications

·

satellite reconnaissance

·

navigation systems

·

radar applications

·

optical filters

·

spatial light modulators


24





·

all-optical transistors

·

entertainment


In an effort to maximize our future revenue stream from our non-linear all-optical and electro-optic polymer products, our business model anticipates that our revenue stream will be derived from one or some combination of the following: (i) technology licensing for specific product applications; (ii) joint venture relationships with significant industry leaders; or (iii) the production and direct sale of our own electro-optic device components. Our objective is to be a leading provider of proprietary technology and know-how in the photonic device markets. In order to meet this objective, subject to successful testing of our technology and having available financial resources, we intend to:


·

Develop non-linear all-optical and electro-optic polymers and photonic devices;

·

Continue to develop proprietary intellectual property;

·

Streamline our product development process;

·

Develop a comprehensive marketing plan;

·

Maintain/develop strategic relationships with government agencies, private firms, and academic institutions; and

·

Continue to attract and retain high-level science and technology personnel to our Company.

 

Our Proprietary Products in Development


As part of a two-pronged marketing strategy, our Company is developing several devices, which are in various stages of development that utilize our organic nonlinear optical materials.


They include:


·

datacomm/telecomm photonic transceiver

·

telecommunications modulator

·

spatial light modulator

·

optical filter

·

all-optical switch

·

multi-channel optical modem

 

Additionally, we must create an infrastructure, including operational and financial systems, and related internal controls, and recruit qualified personnel. Failure to do so could adversely affect our ability to support our operations.


Capital Requirements

 

As a development stage company, we do not generate revenues. We have incurred substantial net losses since inception. We have satisfied our capital requirements since inception primarily through the issuance and sale of our common stock.  During 2013 we received $2,351,008 in cash proceeds from  the issuance and sale of our common stock . During the first quarter of 2014 we received $266,410 in cash proceeds from  the issuance and sale of our common stock .


Results of Operations


Comparison of three months ended March 31, 2014 to three months ended March 31, 2013


Revenues


As a development stage company, we had revenues of $2,500 during the three months ended March 31, 2014 and $0 for the three months ending March 31, 2013.  The Company is in various stages of material development and evaluation, and product development with potential customers and expects the next revenue stream to be in sale of nonlinear optical polymer materials, prototype devices, application and non-recurring engineering charges prior to moving into production.




25





Operating Expenses


Our operating expenses were $987,671 and $903,000 for the three months ended March 31, 2014 and 2013, respectively, for an increase of $84,671. This increase in operating expenses was due primarily to increases in research and development salaries and wages, laboratory electro-optic device prototype, development and outsourced testing expenses, laboratory materials and supplies, research and development non-cash stock option and warrant amortization, depreciation, investor relations expenses, software expense, rent and utility expenses, lodging and moving expenses,  offset by decreases in general and administrative non-cash amortization of options and warrants, general and administrative wages and salaries and legal expenses.  


Included in our operating expenses for the three months ended March 31, 2014 was $585,506 for research and development expenses compared to $455,382 for the three months ended March 31, 2013, for an increase of $130,124. This is primarily due to increases in research and development salaries and wages, laboratory electro-optic device prototype, development and outsourced testing expenses, laboratory materials and supplies, research and development non-cash stock option and warrant amortization, depreciation, lodging and moving expenses.  


Research and development expenses currently consist primarily of compensation for employees engaged in internal research, product and application development activities; laboratory operations, outsourced material testing and prototype electro-optic device design, development and processing work; customer testing; fees; costs; and related operating expenses.  


We expect to continue to incur substantial research and development expense to develop and commercialize our electro-optic material platform. These expenses will increase as a result of accelerated development effort to support commercialization of our non-linear optical polymer materials technology; outsourcing work to build device prototypes; expanding and equipping in-house laboratories; hiring additional technical and support personnel; engaging a senior technical advisor; pursuing other potential business opportunities and collaborations; customer testing and evaluation; and incurring related operating expenses.


Research and development wages and salaries increased $38,938 from $172,334 for the three months ended March 31, 2013 to $211,272 for the three months ended March 31, 2014, primarily due to additional employees hired to perform in-house material development, testing and device development in the Company’s laboratory facilities.  Accordingly laboratory materials and supplies increased $9,763 from $12,363 for the three months ended March 31, 2013 to $22,126 for the three months ended March 31, 2014.  Also, laboratory electro-optic device prototype, development and outsourced testing expenses increased $46,448 from $57,884 for the three months ended March 31, 2013 to $104,332 for the three months ended March 31, 2014 as the Company expands its prototype development efforts.


Depreciation expense increased $7,266 from $22,350 for the three months ended March 31, 2013 to $29,616 for the three months ended March 31, 2014 primarily due to the additional equipment purchased for the Company’s laboratory facilities.  


Research and development non-cash stock compensation and stock option and warrant amortization increased $14,166 from $130,285 for the three months ended March 31, 2013 to $144,451 for the three months ended March 31, 2014.


Research and development lodging expenses increased $6,119 from $2,469 for the three months ended March 31, 2013 to $8,588 for the three months ended March 31, 2014.


Moving expenses incurred during the three months ending March 31, 2014, for the move of the optical lab to the Company’s new headquarter facility in Colorado were $3,972.


General and administrative expense consists primarily of compensation and support costs for management staff, and for other general and administrative costs, including executive, sales and marketing, investor relations, accounting and finance, legal, consulting and other operating expenses.  


General and administrative expenses decreased $45,453 to $402,165 for the three months ended March 31, 2014 compared to $447,618 for the three months ended March 31, 2013.  The decrease is due primarily to decreases in general and administrative non-cash amortization of options and warrants, general and administrative wages and salaries and legal expenses offset by increases in investor relations expenses, software expense, rent and utility expenses and general and administrative moving expenses.


General and administrative non-cash stock option and warrant amortization decreased $62,931 from $139,639 for the three months ended March 31, 2013 to $76,708 for the three months ended March 31, 2014.  


General and administrative wages and salaries decreased $12,912 from $128,577 for the three months ended March 31, 2013 to $115,665 for the three months ended March 31, 2014.




26





Legal fees decreased $5,556 to $32,278 for the three months ended March 31, 2014 compared to $37,834 for the three months ended March 31, 2013.


Investor relations expenses increased $16,780 to $16,810 for the three months ended March 31, 2014 from $30 for the three months ended March 31, 2013 in an effort to expand the Company’s exposure to a broader base of investors.


Software expenses increased $4,266 from $0 for the three months ended March 31, 2013 to $4,266 for the three months ended March 31, 2014 primarily for the implementation during the second quarter of 2012, of an employee stock option software program for interactive option exercises by employees and directors under the 2007 Employee Stock Plan.  


Rent and utility expenses increased $4,583 from $3,900 for the three months ended March 31, 2013 to $8,483 for the three months ended March 31, 2014 for the expenses of the new headquarter facility in Colorado.


Moving expenses incurred during the three months ending March 31, 2014, for the move of the Company’s corporate office to the new headquarter facility in Colorado were $7,736.


We expect general and administrative expense to increase in future periods as we increase the level of corporate and administrative activity, including increases associated with our operation as a public company; and significantly increase expenditures related to the future production and sales of our products.


Other Income (Expense)


Other income (expense) decreased $16,791 to ($2,680) for the three months ending March 31, 2014 from ($19,471) for the three months ending March 31, 2013, relating primarily to the commitment fee associated with the resale of shares to an institutional investor of an amended agreement for resale during the corresponding three-month period.  


Net Loss


Net loss was $987,851 and $922,471 for the three months ended March 31, 2014 and 2013, respectively, for an increase of $65,380, due primarily to increases in research and development salaries and wages, laboratory electro-optic device prototype, development and outsourced testing expenses, laboratory materials and supplies, research and development non-cash stock option and warrant amortization, depreciation, investor relations expenses, software expense, rent and utility expenses, lodging and moving expenses, offset by decreases in general and administrative non-cash amortization of options and warrants, general and administrative wages and salaries, legal expenses and commitment fee to institutional investor.  


Significant Accounting Policies


Our discussion and analysis of our financial condition and results of operations are based on our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates based upon historical experience and various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Our actual results may differ materially from these estimates.

 

We believe our significant accounting policies affect our more significant estimates and judgments used in the preparation of our financial statements.  Our Annual Report on Form 10-K for the year ended December 31, 2013 contains a discussion of these significant accounting policies. There have been no significant changes in our significant accounting policies since December 31, 2013.  See our Note 1 in our unaudited financial statements for the three months ended March 31, 2014, as set forth herein.


Liquidity and Capital Resources


During the three months ended March 31, 2014, net cash used in operating activities was $520,210 and net cash used in investing activities was $86,807, which was due primarily to the Company’s research and development activities and general and administrative expenditures.  Net cash provided by financing activities for the three months ended March 31, 2014 was $266,410.  At March 31, 2014, our cash and cash equivalents totaled $1,930,097, our assets totaled $2,937,730, our liabilities totaled $312,637, and we had stockholders’ equity of $2,625,093.




27





Sources and Uses of Cash


Our future expenditures and capital requirements will depend on numerous factors, including: the progress of our research and development efforts; the rate at which we can, directly or through arrangements with original equipment manufacturers, introduce and sell products incorporating our polymer materials technology; the costs of filing, prosecuting, defending and enforcing any patent claims and other intellectual property rights; market acceptance of our products and competing technological developments; and our ability to establish cooperative development, joint venture and licensing arrangements.  We expect that we will incur approximately $3,240,000 of expenditures over the next 12 months.  Our cash requirements are expected to increase at a rate consistent with the Company’s path to revenue growth as we expand our activities and operations with the objective of commercializing our electro-optic polymer technology during 2014.


Our business does not presently generate the cash needed to finance our current and anticipated operations. We believe we have raised sufficient capital to finance our operations through October 2014, however, we will need to obtain additional future financing after that time to finance our operations until such time that we can conduct profitable revenue-generating activities.


Such future sources of financing may include cash from equity offerings, exercise of stock options, warrants and proceeds from debt instruments; but we cannot assure you that such equity or borrowings will be available or, if available, will be at rates or prices acceptable to us.

 

In May 2011 we signed our stock purchase agreement with Lincoln Park whereby subject to certain conditions and at our sole discretion, Lincoln Park has committed to purchase up to $20 million of our common stock over a 30-month period. We registered for resale by Lincoln Park 10,000,000 shares of our common stock in June 2011. The stock purchase agreement expired in December 2013. In June 2013 we signed our new stock purchase agreement with Lincoln Park to sell up to $20 million of common stock whereby subject to certain conditions and at our sole discretion, Lincoln Park has committed to purchase up to $20 million of our common stock over a 30-month period. We registered for resale by Lincoln Park 10,000,000 shares of our common stock in October 2013.  Pursuant to the new stock purchase agreement, Lincoln Park is obligated to make purchases as the Company directs in accordance with the purchase agreement, which may be terminated by the Company at any time, without cost or penalty. Sales of shares will be made in specified amounts and at prices that are based upon the market prices of our Company's common stock immediately preceding the sales to Lincoln Park. We expect this financing to provide our Company with sufficient funds to maintain its operations for the foreseeable future. With the additional capital, we expect to achieve a level of revenues attractive enough to fulfill our development activities and adequate enough to support our business model for the foreseeable future.  We cannot assure you that we will meet the conditions of the stock purchase agreement with Lincoln Park in order to obligate Lincoln Park to purchase our shares of common stock. In the event we fail to do so, and other adequate funds are not available to satisfy either short-term or long-term capital requirements, or if planned revenues are not generated, we may be required to substantially limit our operations. This limitation of operations may include reductions in capital expenditures and reductions in staff and discretionary costs.

 

There are no trading volume requirements or restrictions under the new stock purchase agreement, and we will control the timing and amount of any sales of our common stock to Lincoln Park. Lincoln Park has no right to require any sales by us, but is obligated to make purchases from us as we direct in accordance with the purchase agreement. We can also accelerate the amount of common stock to be purchased under certain circumstances. There are no limitations on use of proceeds, financial or business covenants, restrictions on future funding, rights of first refusal, participation rights, penalties or liquidated damages in the purchase agreement. We may terminate the stock purchase agreement at any time, at our discretion, without any penalty or cost to us. Lincoln Park may not assign or transfer its rights and obligations under stock the purchase agreement.


We expect that our cash used in operations will increase during 2014 and beyond as a result of the following planned activities:


·

The addition of management, sales, marketing, technical and other staff to our workforce;

·

Increased spending for the expansion of our research and development efforts, including purchases of additional laboratory and production equipment;

·

Increased spending in marketing as our products are introduced into the marketplace;

·

Developing and maintaining collaborative relationships with strategic partners;

·

Developing and improving our manufacturing processes and quality controls; and

·

Increases in our general and administrative activities related to our operations as a reporting public company and related corporate compliance requirements.




28





Analysis of Cash Flows


For the three months ended March 31, 2014


Net cash used in operating activities was $520,210 for the three months ended March 31, 2014, primarily attributable to the net loss of $987,851 adjusted by $30,525 in warrants issued for services, $190,634 in options issued for services, $2,743 in common stock issued for services, $33,924 in depreciation expenses and patent amortization expenses, $19,354 in prepaid expenses and $190,461 in accounts payable and accrued expenses.  Net cash used in operating activities consisted of payments for research and development, legal, professional and consulting expenses, rent and other expenditures necessary to develop our business infrastructure.


Net cash used by investing activities was $86,807 for the three months ended March 31, 2014, consisting of $28,748 in cost for intangibles and $58,059 in asset additions primarily for the lab facility and new corporate office.


Net cash provided by financing activities was $266,410 for the three months ended March 31, 2014 and consisted of $177,660 in proceeds from resale of common stock to an institutional investor and $88,750 from the exercise of options and warrants.


Inflation and Seasonality


We do not believe that our operations are significantly impacted by inflation. Our business is not seasonal in nature. 


Item 4

Controls and Procedures



Evaluation of Disclosure Controls and Procedures.   The Company’s management, with the participation of the Company’s Principal Executive Officer and Principal Financial Officer, evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) as of March 31, 2014.  Based on this evaluation, the Company’s Principal Executive Officer and Principal Financial Officer concluded that, as of March 31, 2014 the Company’s disclosure controls and procedures were effective, in that they provide reasonable assurance that information required to be disclosed by the Company in the reports that it files or submits under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and is accumulated and communicated to the Company’s management, including the Company’s Principal Executive Officer and Principal Financial Officer, as appropriate to allow timely decisions regarding required disclosure.


Changes in Internal Control Over Financial Reporting. There were no changes in our internal control over financial reporting during the quarter ended March 31, 2014 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.



29







PART II – OTHER INFORMATION


Item 2

Unregistered Sales of Equity Securities and Use of Proceeds


Date

  

Security/Value

  

  

  

January 2014

  

Warrant – right to buy 100,000 shares of common stock at $0.715 per share issued for services.  

  

  

  

January 2014

 

Common Stock – 10,000 shares of common stock at $0.25 per share pursuant to an option exercise for total proceeds of $2,500.

 

 

 

January 2014

  

Options – right to buy 200,000 shares of common stock at $0.715 per share issued for services.  

  

  

  

March 2014

  

Common Stock – 250,000 shares of common stock at $0.345 per share pursuant to a warrant exercise for total proceeds of $86,250.

 

  

 

March 2014

  

Options – right to buy 350,000 shares of common stock at $0.92 per share issued for services.  

  

  

  

March 2014

  

Warrant – right to buy 100,000 shares of common stock at $0.92 per share issued for services.  

  

  

  


No underwriters were utilized and no commissions or fees were paid with respect to any of the above transactions.  We relied on Section 4(2) of the Securities Act of 1933, as amended, since the transactions did not involve any public offering.


Item 5

Other Information


On March 3, 2014, we entered into a new employee agreement with Thomas E. Zelibor with respect to his position as Chief Executive Officer of our Company. Pursuant to the employee agreement, among other things, Mr. Zelibor is entitled to receive as compensation a stock award whereby 25,000 shares of our common stock would be issued to him on March 3, 2014 and 25,000 shares of our common stock would be issued to him on each successive contract anniversary of the commencement term of his employee agreement.  To date, no shares have been issued to Mr. Zelibor pursuant to the stock award provision of his employee agreement. On May 12, 2014, Mr. Zelibor delivered a letter to our Company confirming to our Company that he is declining the award of all current and future shares of common stock awards that he is entitled to under the stock award provision of his employee agreement.  


Item 6

Exhibits

         

The following exhibits are included herein:


Exhibit No.

Description of Exhibit

 

Location

10.1

Employment Agreement - Thomas E. Zelibor

 

*

10.2

Letter Agreement Re: Employment Agreement - Thomas E. Zelibor

 

Filed herewith

31.1

Certification pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended, executed by the Principal Executive Officer of the Company.

 

Filed herewith

31.2

Certification pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended, executed by the Principal Financial Officer of the Company.

 

Filed herewith

32.1

Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, executed by the Principal Executive Officer of the Company.

 

Filed herewith

32.2

Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, executed by the Principal Financial Officer of the Company.

 

Filed herewith

101

XBRL

 

Furnished herewith

    

*

Incorporated by reference to our Form 8-K filed on March 5, 2014.



30






SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

LIGHTWAVE LOGIC, INC.

 

Registrant


By:

/s/ Thomas E. Zelibor

 

 

Thomas E. Zelibor,

 

 

Chief Executive Officer

 

 

(Principal Executive Officer)

 

 

Date:  May 14, 2014


By:

/s/ James S. Marcelli

 

 

James S. Marcelli,

 

 

President, Chief Operating Officer

 

 

(Principal Financial Officer)

 


Date:  May 14, 2014












31


EXHIBIT 10.2






May 12, 2014


Mr. James Marcelli

President

Lightwave Logic, Inc.

1831 Lefthand Circle, Suite C

Longmont, CO 80501


Re: Thomas E. Zelibor Employee Agreement Dated March 3, 2014


Dear Jim:


As we previously discussed, please let this letter serve as confirmation to the company that I am declining the award of all current and future shares of common stock that I am entitled to receive pursuant to the Stock Award provision of my March 3, 2014 employee agreement.



Sincerely,


/s/ Thomas E. Zelibor



Thomas E. Zelibor









Exhibit 31.1

CERTIFICATION

I, Thomas E. Zelibor, certify that:

1.

I have reviewed this Quarterly Report on Form 10-Q of Lightwave Logic, Inc.;

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.

The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)

Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.

The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:  May 14, 2014

/s/ Thomas E. Zelibor

 

 

Thomas E. Zelibor,

 

 

Chief Executive Officer

 

 

(Principal Executive Officer)

 






Exhibit 31.2

CERTIFICATION

I, James S. Marcelli, certify that:

1.

I have reviewed this Quarterly Report on Form 10-Q of Lightwave Logic, Inc.;

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.

The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)

Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.

The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:  May 14, 2014

/s/ James S. Marcelli

 

 

James S. Marcelli,

 

 

President, Chief Operating Officer

 

 

(Principal Financial Officer)

 






Exhibit 32.1

CERTIFICATION PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
18 U.S.C. SECTION 1350

In connection with the Quarterly Report on Form 10-Q of Lightwave Logic, Inc. (the “Company”) for the period ending March 31, 2014 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Thomas E. Zelibor, Chief Executive Officer of our Company, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that, to my knowledge:

1.

The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.

The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of our Company.


Date:  May 14, 2014

/s/ Thomas E. Zelibor

 

 

Thomas E. Zelibor,

 

 

Chief Executive Officer

 

 

(Principal Executive Officer)

 







Exhibit 32.2

CERTIFICATION PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
18 U.S.C. SECTION 1350

In connection with the Quarterly Report on Form 10-Q of Lightwave Logic, Inc. (the “Company”) for the period ending March 31, 2014 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, James S. Marcelli, Chief Operating Officer of our Company, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that, to my knowledge:

1.

The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.

The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of our Company.


Date:  May 14, 2014

/s/ James S. Marcelli

 

 

James S. Marcelli,

 

 

President, Chief Operating Officer

 

 

(Principal Financial Officer)