|9 Months Ended|
Sep. 30, 2016
|Disclosure Text Block Supplement [Abstract]|
Note 6 Commitments
The Company entered into a consulting agreement dated July 15, 2016 with Mr. Phillip Boudjouk in the area of working as a scientific and technical consultant. The Company anticipates that Mr. Boudjouk’s work under this consulting agreement will be performed for the Company, in support of their business development, research, development, and commercialization activities. The consulting agreement was effective as of July 15, 2016 and shall continue in full force and effect through July 14, 2017. The Company shall pay Mr. Boudjouk a fee of $7,000 per month. During the three and nine months ended September 30, 2016, the Company paid $17,500.
The Company entered into a Sponsored Research Agreement (“SRA”) dated August 14, 2015 with North Dakota State University Research Foundation (“NDSU/RF”). With the proposed research for this project, NDSU/RF plans to make prototypical compounds and materials from Cyclohexasilane (“CHS”) and CHS derivatives with the potential; 1) to act as efficient photoactive materials for solar cells, 2) to serve in electro active devices for optimization of current and voltage performance, 3) to perform at high levels of efficiency as silicon anodes in lightweight batteries (silicon has more than 11 times the capacity of carbon in the ubiquitous carbon based batteries), and, 4) to be incorporated into to specialty inks for printed electronics applications. The research commenced August 14, 2015 through August 31, 2016. The Company agreed to reimburse NDSU/RF for all costs incurred in performing the research up to a maximum amount of $70,000. On June 7, 2016 the Company and NDSU/RF mutually agreed to amend the SRA. Under the terms of the amendment the term was extended to June 30, 2017 and the consideration was increased by $120,000 to a maximum amount of $190,000. The Company recognized expense of $28,893 and $61,904 during the three and nine months ended September 30, 2016, respectively, leaving a balance of $128,096.
The Company entered into a one-year Independent Consulting Agreement with Concordia Financial Group (“Concordia”) effective August 1, 2016, and month-to-month thereafter. Under the terms of the agreement Concordia will provide business strategy services by assisting the Company by reviewing and evaluating the Company's plans, personnel, board composition, technology, development of business models, building financial models for projections, developing materials to describe the Company, developing capital sources and assisting and advising the Company in its financial negotiations with capital sources. Concordia also advises with respect to effective registration of offerings of Company securities, the management team, the Company's development of near and long-term budgets, marketing strategies and plans, and assists in presentations related to the above services. Concordia is paid an hourly fee of $185.
Effective June 16, 2016, (the "Effective Date") Coretec (“Licensee”) and NDSU/RF signed an Exclusive License agreement (the “NDSU/RF Agreement") to have certain intellectual property rights (the “Patent Rights”), owned by NDSU/RF, developed and commercialized.
Under the terms of the NDSU/RF Agreement, NDSU/RF granted Coretec an exclusive license to make, have made, use, sell, or any combination of the foregoing, Licensed Products and Licensed Processes in the Field of Use and the Licensed Territory as defined in the NDSU/RF Agreement. Additionally NDSU/RF granted to Licensee a limited exclusive eighteen month option (the “Option Term”) to license Optioned Technologies' Patent Rights (”Optioned Technologies”), as described in the NDSU/RF Agreement. Licensee may only undertake technical, economic, and commercial evaluation of each optioned patent during the Option Term. Such evaluation by Licensee shall only be to determine if Licensee exercises its option and negotiates a license to such patent(s) as a Licensed Technology under the NDSU/RF Agreement and not to develop intellectual property or patents during the Option Period. Licensee agreed to actively and diligently evaluate Optioned Technologies so as to determine and report to NDSU/RF the status and progress toward the licensing of each patent listed in the NDSU/RF Agreement during the Option Period. If Licensee decides to not pursue any further evaluation of any patent or patent application of Optioned Technology Patent Rights in any quarter or during the previous quarter has not carried out any evaluation activities on any such patent or patent application, then any such patent or patent application shall be deleted from the NDSU/RF Agreement at the end of such quarter and all rights to such deleted Patent Rights shall revert to NDSU/RF.
In consideration for signing the NDSU/RF Agreement, Coretec agreed to pay NDSU/RF a license issue fee of $25,000 upon signing the NDSU/RF Agreement and an annual license maintenance fee of $25,000 beginning one year from the Effective Date of the NDSU/RF Agreement and annually thereafter in the event net sales of the Licensed Technology do not exceed three million dollars ($3,000,000) of which NDSU/RF shall receive a 6% royalty on the net sales. NDSU/RF shall also receive fifty percent (50%) of all sublicense fees received by Coretec. Coretec also agreed to pay to NDSU/RF all fees and costs relating to the filing, prosecution, and maintenance of the Patent Rights, whether such fees and costs were incurred before or after the Effective Date of this NDSU/RF Agreement and reimburse NDSU/RF for all prior invoiced patenting expenses (not to exceed to $227,111 as of April 1, 2016), (“LT Prior Expenses”). On an on-going basis, Coretec agreed to reimburse NDSU/RF patenting expenses invoiced after April 1, 2016 (“LT On-going Expenses”) and each month thereafter during the term of the Agreement. The LT On-going Expenses are due monthly within thirty days of being invoiced. The LT Prior Expenses of $227,111 are to be paid to NDSU/RF according to the following schedule:
In regards to the Optioned Technologies, in the event Coretec exercises its option on the Optioned Technology, Coretec agreed to reimburse NDSU/RF for all prior invoiced patenting expenses (not to exceed $240,332 as of April 1, 2016) pertaining to the Optioned Technologies incurred and invoiced prior to April 1, 2016 (“OT Prior Expenses"). Licensee shall reimburse NDSU/RF for OT Prior Expenses of Optioned Technologies according to the following schedule:
Beginning April 1, 2016 and during the Option Period, Licensee also agreed to reimburse NDSU/RF for all ongoing and future patenting expenses ("OT On-going Expenses") pertaining to Optioned Technologies accrued and invoiced after April 1, 2016. OT On-going Expenses of Optioned Technologies are to be reimbursed within thirty (30) days of being invoiced.
Licensee may terminate this NDSU/RF Agreement at any time by providing at least six (6) months written, unambiguous notice of such termination to NDSU/RF. Licensee shall remain obligated to pay all amounts due NDSU/RF through the effective date of the termination.
During the three and nine months ended September 30, 2016, Coretec paid $37,442 and $86,074 respectively under the terms of the NDSU/RF Agreement.
As of the date of filing, the Company has not exercised the Optioned Technologies.
The entire disclosure for significant arrangements with third parties, which includes operating lease arrangements and arrangements in which the entity has agreed to expend funds to procure goods or services, or has agreed to commit resources to supply goods or services, and operating lease arrangements. Descriptions may include identification of the specific goods and services, period of time covered, minimum quantities and amounts, and cancellation rights.
Reference 1: http://www.xbrl.org/2003/role/presentationRef