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Document and Entity Information

v2.4.0.8
Document and Entity Information
9 Months Ended
Sep. 30, 2013
Oct. 31, 2013
DocumentAndEntityInformationAbstract    
Entity Registrant Name Applied Nanotech Holdings, Inc.  
Entity Central Index Key 0000891417  
Document Type 10-Q  
Document Period End Date Sep. 30, 2013  
Amendment Flag false  
Current Fiscal Year End Date --12-31  
Is Entity a Well-known Seasoned Issuer? No  
Is Entity a Voluntary Filer? No  
Is Entity's Reporting Status Current? Yes  
Entity Filer Category Smaller Reporting Company  
Entity Common Stock, Shares Outstanding   139,997,816
Document Fiscal Period Focus Q3  
Document Fiscal Year Focus 2013  

Consolidated Balance Sheets

v2.4.0.8
Consolidated Balance Sheets (USD $)
Sep. 30, 2013
Dec. 31, 2012
Current assets:    
Cash and cash equivalents $ 352,973 $ 331,579
Accounts receivable - net of allowance for doubtful accounts 382,633 369,409
Prepaid expenses and other current assets 84,055 692,541
Total current assets 819,661 1,393,529
Property and equipment, net 194,638 270,693
Other assets 26,960 28,591
Total assets 1,041,259 1,692,813
Current liabilities:    
Accounts payable 598,846 813,505
Convertible notes payable 1,893,128 755,800
Obligations under capital lease 23,858 56,680
Accrued liabilities 1,393,000 855,264
Deposits and deferred revenue 51,239 103,370
Total current liabilities 3,960,071 2,584,619
Obligations under capital lease, long-term 0 10,480
Convertible notes payable 0 1,631,072
Total liabilities 3,960,071 4,226,171
Commitments and contingencies      
Stockholders' equity (deficit):    
Preferred stock, $1.00 par value, 2,000,000 shares authorized; No shares issued and outstanding 0 0
Common stock, $.00l par value, 160,000,000 shares authorized, 135,767,864 and 119,699,286 shares issued and outstanding at September 30, 2013 and December 31, 2012, respectively 135,768 119,699
Additional paid-in capital 117,347,131 115,332,346
Accumulated deficit (120,401,711) (117,985,403)
Total stockholders' deficit (2,918,812) (2,533,358)
Total liabilities and stockholders' deficit $ 1,041,259 $ 1,692,813

Balance Sheets (Parenthetical)

v2.4.0.8
Balance Sheets (Parenthetical) (USD $)
Sep. 30, 2013
Dec. 31, 2012
Statement of Financial Position [Abstract]    
Preferred stock par value $ 1.00 $ 1.00
Preferred stock shares authorized 2,000,000 2,000,000
Preferred stock shares issued 0 0
Preferred stock shares outstanding 0 0
Common stock par value $ 0.001 $ 0.001
Common stock shares authorized 160,000,000 160,000,000
Common stock shares issued 135,767,864 119,699,286
Common stock shares outstanding 135,767,864 119,699,286

Consolidated Statements of Operations

v2.4.0.8
Consolidated Statements of Operations (USD $)
3 Months Ended 9 Months Ended
Sep. 30, 2013
Sep. 30, 2012
Sep. 30, 2013
Sep. 30, 2012
Revenues        
Government contracts $ 560,606 $ 436,729 $ 1,475,623 $ 1,223,273
Contract research 174,698 98,888 938,628 250,242
License fees and royalties 350,581 109,000 488,936 887,896
Product sales 81,729 54,543 249,350 189,031
Other 7,600 6,345 38,159 62,150
Total revenues 1,175,214 705,505 3,190,696 2,612,592
Research and development 776,324 938,865 2,555,472 3,601,210
Selling, general and administrative expenses 616,665 880,892 2,000,145 3,097,250
Operating costs and expenses 1,392,989 1,819,757 4,555,617 6,698,460
Loss from operations (217,775) (1,114,252) (1,364,921) (4,085,868)
Interest expense (183,398) (131,565) (1,055,164) (319,528)
Interest income 3,723 8 3,777 1,583
Loss from continuing operations before taxes (397,450) (1,245,809) (2,416,308) (4,403,813)
Provision for taxes 0 0 0 0
Net loss $ (397,450) $ (1,245,809) $ (2,416,308) $ (4,403,813)
Earnings (loss) per share - Basic and Diluted $ 0.00 $ (0.01) $ (0.02) $ (0.04)
Weighted average shares outstanding - Basic and Diluted 131,390,259 119,381,717 128,567,427 119,194,845

Consolidated Statements of Cash Flows

v2.4.0.8
Consolidated Statements of Cash Flows (USD $)
9 Months Ended
Sep. 30, 2013
Sep. 30, 2012
Statement of Cash Flows [Abstract]    
Net loss $ (2,416,308) $ (4,403,813)
Depreciation and amortization expense 76,055 83,037
Amortization of discount on debt 896,980 274,815
Stock based compensation expense 60,204 215,291
Accounts receivable, trade (13,224) 403,915
Prepaid expenses and other assets 610,117 (545,706)
Accounts payable and accrued liabilities 491,178 812,381
Deferred revenue (52,131) (200,000)
Total adjustments 2,069,179 1,043,733
Net cash used in operating activities (347,129) (3,360,080)
Cash flows from investing activities:    
Purchases of property and equipment 0 (50,398)
Net cash used in investing activities 0 (50,398)
Cash flows from financing activities:    
Repayment of capital leases and notes payable (114,102) (36,590)
Proceeds from long-term debt 482,625 735,700
Net cash provided by financing activities 368,523 699,110
Net increase (decrease) in cash and cash equivalents 21,394 (2,711,368)
Cash and cash equivalents, beginning of period 331,579 3,071,783
Cash and cash equivalents, end of period $ 352,973 $ 360,415

1. Basis of Presentation

v2.4.0.8
1. Basis of Presentation
9 Months Ended
Sep. 30, 2013
Accounting Policies [Abstract]  
1. Basis of Presentation

The consolidated financial statements for the three and nine month periods ended September 30, 2013 and 2012 have been prepared by us without audit pursuant to the rules and regulations of the Securities and Exchange Commission. In the opinion of management, all adjustments necessary to present fairly our financial position, results of operations, and cash flows as of September 30, 2013 and 2012, and for the periods then ended, have been made. Those adjustments consist of normal and recurring adjustments. The consolidated balance sheet as of December 31, 2012, has been derived from the audited consolidated balance sheet as of that date.

 

Certain information and note disclosures normally included in our annual financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. These consolidated financial statements should be read in conjunction with a reading of the financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2012, as filed with the U.S. Securities and Exchange Commission. The results of operations for the three and nine month periods ended September 30, 2013, are not necessarily indicative of the results to be expected for the full year.

 

Certain reclassifications have been made in the prior period’s consolidated interim financial information to conform to the current year’s presentation.

2. Supplemental Cash Flow Information

v2.4.0.8
2. Supplemental Cash Flow Information
9 Months Ended
Sep. 30, 2013
Supplemental Cash Flow Elements [Abstract]  
2. Supplemental Cash Flow Information

Cash paid for interest for the nine months ended September 30, 2013 and 2012, was $11,641 and $18,676, respectively. During the nine months ended September 30, 2013 and 2012, the Company had non-cash transactions related to share based payments described in greater detail in Note 5, non-cash transactions related to the conversion of accounts payable into common stock described in greater detail in Note 4, and non-cash transactions related to the conversion of notes payable and related accrued interest into common stock that are described in greater detail in Notes 3 and 4. The Company also had a capital lease transaction in the amount of $28,567 in the nine months ended September 30, 2012.

3. Notes Payable and Long-Term Debt

v2.4.0.8
3. Notes Payable and Long-Term Debt
9 Months Ended
Sep. 30, 2013
Debt Disclosure [Abstract]  
3. Notes Payable and Long-Term Debt

As described in detail in our Form 10-K for the year ended December 31, 2012 we issued convertible notes from 2009 through 2012. Additional notes with a face amount of $482,625 were issued in the nine months ended September 30, 2013. As of September 30, 2013, there are notes with a total face amount of $2,042,958 outstanding. These notes are due at dates throughout 2013 and through August 2014. These notes bear interest at rates ranging from 5% to 8%, and $277,150 of the notes outstanding include a 10% original issuance discount. The notes are convertible at fixed rates ranging from $0.08 to $0.25 per share and $339,900 of the face amount of the notes are convertible at floating discounts to the market price of our common stock at the date of conversion. The majority of these floating rates are at a 30% discount to market.

 

At the time of issuance the value of the beneficial conversion feature of these notes is calculated, recorded as a discount to the note, and amortized to expense over the term of the note. If the notes are converted before maturity, any unamortized expense at the time of conversion is expensed at the time of conversion. As of September 30, 2013, there is $149,831 of unamortized discount remaining to be amortized in future periods.

 

A total of $896,980 and $274,815 of discount was amortized to interest expense during the nine month periods ending September 30, 2013 and 2012, respectively.

4. Stockholders Equity

v2.4.0.8
4. Stockholders Equity
9 Months Ended
Sep. 30, 2013
Equity [Abstract]  
4. Stockholders Equity

During the nine months ended September 30, 2013, we issued 600,000 shares of common stock related to the payment of $60,000 of trade payables in an exempt offering under Regulation D of the Securities Act of 1933. We also issued 165,735 shares of common stock in connection with restricted stock payments to employees during the same period. During the nine months ended September 30, 2013, we issued 14,832,858 shares of common stock as the result of the conversion of notes payable and related accrued interest in the amount of $1,099,527. We also issued 470,085 shares in connection with a cashless exercise of 1,692,307 warrants issued in January 2013 in connection with the issuance of convertible notes.

 

During the nine months ended September 30, 2012, we issued 494,949 shares of common stock in payment of accounts payable in the amount of $120,000, and 94,360 shares in connection with restricted stock payments to employees.

5. Share-Based Payments

v2.4.0.8
5. Share-Based Payments
9 Months Ended
Sep. 30, 2013
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
5. Share-Based Payments

We use the fair value method to account for stock based compensation. We recorded $60,204 and $215,291 in compensation expense in the periods ended September 30, 2013 and 2012, respectively, related to options and restricted stock issued under our stock-based incentive compensation plans. This includes expense related to both options issued and committed, as well as unissued restricted stock in the current year, and options issued in prior years for which the requisite service period for those options includes the current year. The fair value of these options was calculated using the Black-Scholes option pricing model. Information related to the assumptions used in this model is set forth in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2012. For options issued in 2013, the same approximate assumptions were used.

6. Contingencies

v2.4.0.8
6. Contingencies
9 Months Ended
Sep. 30, 2013
Commitments and Contingencies Disclosure [Abstract]  
6. Contingencies

Litigation

 

The Company is a defendant in minor lawsuits described in greater detail in its 2012 Annual Report on Form 10-K. The Company expects any potential eventual payment to have no material effect on the financial statements.

7. Subsequent Events

v2.4.0.8
7. Subsequent Events
9 Months Ended
Sep. 30, 2013
Subsequent Events [Abstract]  
7. Subsequent Events

In October 2013, the Company issued an additional 400,000 shares of common stock in payment of an amount due to the Company’s patent attorney. In addition, 3,809,717 shares of common stock were issued related to the conversion of convertible notes payable in the amount of $70,106.

 

In October 2013, the Company signed a non-binding letter of intent with Nanofilm, Ltd. to combine the two companies through a stock swap transaction.

2. Supplemental Cash Flow Information (Narrative)

v2.4.0.8
2. Supplemental Cash Flow Information (Narrative) (USD $)
9 Months Ended
Sep. 30, 2013
Sep. 30, 2012
Supplemental Cash Flow Elements [Abstract]    
Cash paid for interest $ 11,641 $ 18,676
Capital lease transaction   $ 28,567

3. Notes Payable and Long-Term Debt (Narrative)

v2.4.0.8
3. Notes Payable and Long-Term Debt (Narrative) (USD $)
9 Months Ended
Sep. 30, 2013
Sep. 30, 2012
Restricted stock issued to employees    
Face amount notes issued $ 2,042,958  
Maturity dates of notes 2013 through August 2014  
Interest rates of notes 5% to 8%  
Unamortized discount 149,831  
Discount amortized to interest expense $ (896,980) $ (274,815)

4. Stockholders Equity (Narrative)

v2.4.0.8
4. Stockholders Equity (Narrative) (USD $)
9 Months Ended
Sep. 30, 2013
Sep. 30, 2012
Notes to Financial Statements    
Restricted stock issued 165,735 94,360
Stock issued in connection with cashless exercise of warrants, shares 470,085  
Warrant shares issued 1,692,307  
Stock issued for conversion of accounts payable-shares 600,000 494,949
Stock issued for conversion of accounts payable $ 60,000 $ 120,000
Stock issued in conversion of notes payable and related interest, shares 14,832,858  
Stock issued in conversion of notes payable and related interest, value $ 1,099,527  

5. Share-Based Payments (Narrative)

v2.4.0.8
5. Share-Based Payments (Narrative) (USD $)
9 Months Ended
Sep. 30, 2013
Sep. 30, 2012
Notes to Financial Statements    
Share-based compensation $ 60,204 $ 215,291