Note 2 – Liquidity and Management Plans

 

During the three months and six months ended June 30, 2016, the Company recorded revenue of $181,818 and $318,812, respectively, and during the three and six months ended June 30, 2015, the Company recorded revenue of $225,000 and $425,000, respectively. During the three months and six months ended June 30, 2016, the Company recorded a net loss of $10,284,555 and $21,081,098, respectively, and during the three and six months ended June 30, 2015, the Company recorded a net loss of $6,156,582 and $13,081,861, respectively. Net cash used in operating activities was $15,946,841 and $10,500,199 for the six months ended June 30, 2016 and 2015, respectively. The Company is currently meeting its liquidity requirements principally through the November 2015 sale of common stock pursuant to a shelf registration and payments received under product development projects entered into with a tier one customer.

 

As of June 30, 2016, the Company had cash on hand of $14,191,312. On April 24, 2015, the Company filed a “shelf” registration statement on Form S-3, under which the Company may from time to time, sell any combination of debt or equity securities up to an aggregate of $75,000,000. In November 2015, the Company consummated an offering under the shelf registration of 3,000,005 shares of common stock through which the Company raised net proceeds of $19,048,456. The Company expects that cash on hand as of June 30, 2016, together with anticipated revenues, will be sufficient to fund the Company’s operations into the third quarter of 2017.

 

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 its available resources including the net proceeds from the Company’s IPO, secondary offering, issuance lender shelf registration, 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 sufficient to sustain its operations.  The Company 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.