Note 2 – Liquidity and Management Plans

 

The Company has not generated revenues since its inception and has incurred net losses for the three months ended March 31, 2014 and 2013 and for the period October 30, 2012 (inception) through March 31, 2014 of $31,009,723, $54,324 and $36,552,091, respectively.

 

As of March 31, 2014, the Company had cash on hand of $730,279 and convertible notes with an outstanding principal and interest balance of $5,785,708. 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 were converted into 1,833,336 and 96,792 shares, respectively, of common stock, thus extinguishing the debt associated with the notes. We expect cash on hand after the IPO will be sufficient to fund our operations through 2015.

 

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 the net proceeds from the Company’s recently completed IPO will be sufficient to enable it to develop 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.