Annual report pursuant to Section 13 and 15(d)

Liquidity and Management Plans

v2.4.1.9
Liquidity and Management Plans
12 Months Ended
Dec. 31, 2014
Liquidity And Management Plan Disclosure [Abstract]  
Liquidity And Management Plan Disclosure [Text Block]
Note 2 – Liquidity and Management Plans
 
As of December 31, 2014, the Company had not yet completed the development of its product and had not yet recorded any revenues. Since inception, the Company’s primary activities have consisted of developing its technology, developing its business plan, raising capital, relocating to a larger facility and recruiting and hiring its workforce and executive team. To date, these activities have been funded primarily through the sale of Senior Secured Convertible Notes (“Convertible Notes”) (See Note 6- Private Placement), the funding of the Company’s initial public offering (“IPO”), which was consummated on April 2, 2014 (See Note 8 – Stockholders’ Equity (Deficit)), the sale of the Company common stock to a strategic investor (See Note 8 – Stockholders’ Equity (Deficit)), the issuance of common stock to our landlord (See Note 7 - Commitments and Contingencies) and the funding of the Company’s secondary offering which was consummated on December 15, 2014 (See Note 8 – Stockholder’s Equity (Deficit)).
 
The Company has not generated revenues since its inception and had net losses of $45,603,110 and $5,521,081 for the years ended December 31, 2014 and 2013, respectively.
  
As of December 31, 2014, the Company had cash on hand of $31,494,592. In April 2014, the Company completed its IPO of 4,600,000 shares of common stock through which the Company raised net proceeds of approximately $24.8 million. In connection with the completion of the IPO, the Company’s outstanding convertible notes and interest accrued thereon were converted into 1,833,336 and 96,792 shares, respectively, of common stock, thus extinguishing the debt associated with the notes. On April 4, 2014, the Company issued 210,527 shares of common stock to a strategic investor upon the receipt of net proceeds of $900,000 ($300,000 received on March 27, 2014, $700,000 received on April 4, 2014 less $100,000 to MDB Capital Group as a commission ). On September 10, 2014, the Company issued 41,563 shares of common stock to the Company’s landlord as prepaid rent and tenant improvements. On November 12, 2014, the Company issued 5,353 shares of common stock to a search firm for services associated with recruiting certain employees. In December 2014, the Company completed a secondary offering of 3,285,714 shares of common stock through which the Company raised net proceeds of approximately $21.0 million. The Company expects that cash on hand as of December 31, 2014 will be sufficient to fund the Company’s operations into the second quarter of 2016.
 
Research and development of new technologies is, by its nature, unpredictable.  Although the Company will undertake development efforts with commercially reasonable diligence, there can be no assurance that our available resources including the net proceeds from the Company’s recently completed IPO, secondary offering, and strategic investor financing will be sufficient to enable it to develop and obtain regulatory approval of its technology to the extent needed to create future revenues to sustain its operations.  The Company expects that it may choose to pursue additional financing, depending upon the market conditions, which could include follow-on equity offerings, debt financing, co-development agreements or other alternatives. Should the Company choose to pursue additional financing, there is no assurance that the Company would be able to do so on terms that it would find acceptable.