false
--12-31
FY
2016
2016-12-31
10-K
0001446159
6489428
Yes
Smaller Reporting Company
11767746
Skyline Medical Inc.
No
No
skln
0.0499
0.0499
0.43
P2D
10.05
10.2
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Certificates of Deposit</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;"> </div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Short-term interest bearing investments are those with maturities of less than <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">one</div> year but greater than <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div> months when purchased. Certificates with maturity dates beyond <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">one</div> year are classified as noncurrent assets. These investments are readily convertible to cash and are stated at cost plus accrued interest, which approximates fair value.</div></div></div>
0.43
6141115
1251510
0
0.2
114102
114102
P4Y335D
P1Y69D
P3Y244D
P1Y73D
P1Y25D
P2Y215D
P346D
P2Y222D
P2Y310D
P1Y167D
P1Y149D
P2Y43D
P2Y32D
P3Y
P5Y
P180D
483478
243.75
243.75
243.75
2567
28
-29
-1
167031
0.4
1548792
933074
1600000
1603260
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">NOTE <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2</div> – DEVELOPMENT STAGE OPERATIONS</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company was formed <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> April</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">23,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2002.</div> Since inception through <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4,564,428</div> shares of common stock have been issued between par value and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$3,131.25.</div> Operations since incorporation have primarily been devoted to raising capital, obtaining financing, development of the Company’s product, administrative services, customer acceptance and sales and marketing strategies.</div></div>
721330
-6667
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">NOTE <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">12</div> – INVESTMENT SECURITIES AND OTHER COMPREHENSIVE INCOME (LOSS)</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The cost and fair values of investment securities available-for-sale at <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> were as follows:</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div> <table style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif;" cellspacing="0" cellpadding="0"> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="15" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid" nowrap="nowrap">December 31, 2016</td> </tr> <tr style="vertical-align: bottom"> <td style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid" nowrap="nowrap">Description</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid" nowrap="nowrap">Cost</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid" nowrap="nowrap">Gross <br /> Unrealized <br /> Gains</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid" nowrap="nowrap">Gross <br /> Unrealized <br /> Losses</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid" nowrap="nowrap">Fair Value</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="width: 48%"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 10%; text-align: right"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 10%; text-align: right"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 10%; text-align: right"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 10%; text-align: right"> </td> <td style="width: 1%; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 2.25pt">Mutual Funds</td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">282,828</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,501</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">-</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">284,329</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> </tr> </table> </div></div>
P5Y
P3Y
6
16
16
16
16
16
16
6800889
5140902
250000
P45D
0.1
10031
0.11
0.11
487.50
0.01
100
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Presentation of Taxes Collected from Customers</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Sales taxes are imposed on the Company’s sales to nonexempt customers. The Company collects the taxes from customers and remits the entire amounts to the governmental authorities. The Company’s accounting policy is to exclude the taxes collected and remitted from revenues and expenses.</div></div></div>
1739770
1739770
250000
1000000
<div style="display: inline; font-family: times new roman; font-size: 10pt"><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif;"> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td> </td> <td nowrap="nowrap" colspan="5" style="text-align: center">Years</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Computers and office equipment</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3 </div></td> <td style="text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">- </div></td> <td style="text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">7</div></div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="width: 82%; text-align: left">Leasehold improvements</td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 5%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td style="width: 5%; text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">5</div></td> <td style="width: 5%; text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td style="width: 1%; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Manufacturing Tooling</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3 </div></td> <td style="text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">- </div></td> <td style="text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">7</div></div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Demo Equipment</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td style="text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3</div></td> <td style="text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td style="text-align: left"> </td> </tr> </table></div>
356
4
6663
6667
933074
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Risks and Uncertainties</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company is subject to risks common to companies in the medical device industry, including, but not limited to, development by the Company or its competitors of new technological innovations, dependence on key personnel, protection of proprietary technology, and compliance with regulations of the FDA and other governmental agencies.</div></div></div>
0.01
175000
35000
P45D
<div style="display: inline; font-family: times new roman; font-size: 10pt"><table style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse;" cellspacing="0" cellpadding="0"> <tr style="vertical-align: bottom"> <td colspan="3" style="border-bottom: black 1pt solid; text-align: center"><div style="display: inline; font-size: 10pt"><div style="display: inline; font-weight: bold;">Range of Exercise Prices</div></div></td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><div style="display: inline; font-size: 10pt"><div style="display: inline; font-weight: bold;">Shares</div></div></td> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><div style="display: inline; font-size: 10pt"><div style="display: inline; font-weight: bold;">Weighted </div></div><br /> <div style="display: inline; font-size: 10pt"><div style="display: inline; font-weight: bold;">Average </div></div><br /> <div style="display: inline; font-size: 10pt"><div style="display: inline; font-weight: bold;">Remaining </div></div><br /> <div style="display: inline; font-size: 10pt"><div style="display: inline; font-weight: bold;">Life</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td colspan="2"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">Options:</div></div></td> <td> </td> <td> </td> <td colspan="2"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td> </td> <td> </td> <td colspan="2"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 1%"><div style="display: inline; font-size: 10pt">$</div></td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2.25</div></div></td> <td style="width: 57%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">293</div></div></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">9.65</div></div></td> <td style="width: 1%"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2.42</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">37,152</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">9.64</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2.80</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">57,145</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">10.00</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">3.75</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">44,000</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">9.50</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">4.125</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">3,636</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">9.75</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">4.1975</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">7,147</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">9.72</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">4.25</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">3,529</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">9.25</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">5.125</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">3,902</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">9.69</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">65.75</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">342</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">8.81</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">73.50</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">1,157</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">9.01</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">77.50</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2,323</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">8.50</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">80.25</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">187</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">8.75</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">86.25</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">232</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">8.25</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">121.875</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">5</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">6.20</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">131.25</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">81</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">5.69</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">148.125</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">928</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">6.21</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">150.00</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">1,760</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">5.63</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">162.50</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">123</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">8.01</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">206.25</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">121</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">7.75</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">248.4375</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">121</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">6.54</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">262.50</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">130</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">6.54</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">281.25</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">529</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">6.04</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">318.75</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">3</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">6.35</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">346.875</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">72</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">7.25</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">431.25</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">306</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">7.19</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">468.75</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">133</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">7.15</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">506.25</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">188</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">7.00</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">543.75</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">53</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">6.77</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">596.25</div></div></td> <td> </td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">45</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">6.75</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td colspan="2"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">Total</div></div></td> <td> </td> <td> </td> <td style="border-bottom: black 2.25pt double"> </td> <td style="border-bottom: black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">165,643</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td colspan="2"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">Warrants:</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">4.46</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">756,999</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">4.92</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">93.75</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2,255</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">1.19</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">123.75</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">94,085</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">3.67</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">150.00</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">4,114</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">1.20</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">225.00</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">107</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">1.07</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">243.75</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2,529</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2.59</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">281.25</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">5,897</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">0.95</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">309.375</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2,850</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2.61</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">309.50</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">222</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2.85</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">337.50</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">178</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">1.46</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">371.25</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">944</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">1.41</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">506.25</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">59</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2.12</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">609.375</div></div></td> <td> </td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">862</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2.09</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td colspan="2"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">Total</div></div></td> <td> </td> <td> </td> <td style="border-bottom: black 2.25pt double"> </td> <td style="border-bottom: black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">871,101</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td> </td> </tr> </table></div>
123.75
9134
66396
2318663
564
20122
120
2318663
628237
2077
91
-2168
-18158
664
17494
1
9899
9900
23187
556479
579666
6282
150777
157059
3157186
8.28
70000
0.01
0.08
0.72
1
1
4
11.25
1.25
83333
0.05
228343
1666667
1
4.319
309649
220112
650413
38919
38283
1346105
864295
214897
144079
1501
47894196
44584118
736725
871877
871877
165271
165271
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><div style="display: inline; font-weight: bold;">Advertising</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Advertising costs are expensed as incurred. Advertising expenses were <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$71,212</div> in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$8,220</div> in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015.</div></div></div></div>
71212
8220
165271
871877
219097
9107
6291
1036744
354449
79246
2807546
5632419
2608183
5397834
284329
284329
1501
282828
4716
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Nature of Operations and Continuance of Operations</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Skyline Medical Inc. (the "Company") was incorporated under the laws of the State of Minnesota in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2002.</div> Effective <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> August</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">6,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2013,</div> the Company changed its name to Skyline Medical Inc. As of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> the registrant had <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4,564,428</div> shares of common stock, par value <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$.01</div> per share, outstanding, adjusted for a <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1</div>-for-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">25</div> reverse stock split effective <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> October</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">27,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016.</div> In this Report, all numbers of shares and per share amounts, as appropriate, have been stated to reflect the reverse stock split. Pursuant to an Agreement and Plan of Merger dated effective <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">16,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2013,</div> the Company merged with and into a Delaware corporation with the same name that was its wholly-owned subsidiary, with such Delaware Corporation as the surviving corporation of the merger. The Company has developed an environmentally safe system for the collection and disposal of infectious fluids that result from surgical procedures and post-operative care. The Company also makes ongoing sales of our proprietary cleaning fluid and filters to users of our systems. In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> April</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2009,</div> the Company received <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">510(k)</div> clearance from the FDA to authorize the Company to market and sell its STREAMWAY SYSTEM products.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The accompanying financial statements have been prepared assuming the Company will continue as a going concern. The Company has suffered recurring losses from operations and had a stockholders’ deficit until <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> August</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015</div> whereupon the Company closed its public offering of units of common stock, Series B Convertible Preferred Stock and Series A Warrants (the “Units”). There remains though, substantial doubt about its ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Since inception to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> the Company raised approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$23,950,996</div> in equity, inclusive of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$2,055,000</div> from a private placement of Series A Convertible Preferred Stock, <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$13,555,003</div> from the public offering of Units, <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$1,739,770</div> from a registered direct offering and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$5,685,000</div> in debt financing. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources.”</div></div></div>
1764090
4856232
16384
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Cash Equivalents</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;"> </div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company considers all highly liquid debt instruments with a maturity of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div> months or less when purchased to be cash equivalents. Cash equivalents are stated at cost, which approximate fair value.</div></div></div>
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">NOTE <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10</div> – SUPPLEMENTAL CASH FLOW DATA</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Cash payments for interest were <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$3</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$246,620</div> for the fiscal years ended <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> respectively.</div></div>
-3092142
4839848
1652438
100000
123.75
4.46
2.25
4.46
93.75
123.75
150
225
243.75
281.25
309.375
309.50
337.50
371.25
506.25
609.375
281.25
93.75
371.25
243.75
609.38
0
243.75
4.46
0
609.38
1
0.4
1
1770556
18059671
756999
5431
2851
52
35084
756999
2255
94085
4114
107
2529
5897
2850
222
178
944
59
862
871101
2792
10703
6455
94152
756999
0.01
0.01
0.01
0.01
0.01
0.01
24000000
24000000
100000000
200000000
8000000
4564428
4564428
208258
45644
2080
-6524513
-4790530
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Credit Risk </div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Financial instruments which potentially subject the Company to concentrations of credit risk consist principally of cash. The Company places its cash with high credit quality financial institutions and, by policy, generally limits the amount of credit exposure to any <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">one</div> financial institution. The Company had a credit risk concentration as a result of depositing <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$1,652,438</div> of funds in excess of insurance limits in a single bank.</div></div></div>
250
2778
181620
303982
72.50
74
72.75
69.25
56.25
50
56.82
50.45
48.10
46.45
1800000
122196
275000
5685000
1.4
1.4
7998
5000
10944000
10697000
0
0
10755000
10338000
189000
359000
10944000
10697000
33143
39916
1
1
0.04
0.04
73249
72275
82356
78566
<div style="display: inline; font-family: times new roman; font-size: 10pt"><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif;"> <tr style="vertical-align: bottom"> <td nowrap="nowrap" style="text-align: left">Stock Options:</td> <td> </td> <td nowrap="nowrap" colspan="3"> </td> <td> </td> <td nowrap="nowrap" colspan="5"> </td> </tr> <tr style="vertical-align: bottom"> <td nowrap="nowrap" style="text-align: left">Year</td> <td style="padding-bottom: 1pt"> </td> <td nowrap="nowrap" colspan="3" style="text-align: center; border-bottom: Black 1pt solid">Shares</td> <td style="padding-bottom: 1pt"> </td> <td nowrap="nowrap" colspan="5" style="text-align: center; border-bottom: Black 1pt solid">Price</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 67%; text-align: left">2011</td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">175</div></td> <td style="width: 1%; text-align: left"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 5%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td style="width: 5%; text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">281.25</div></td> <td style="width: 5%; text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td style="width: 1%; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">2012</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,841</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">131.25 </div></div></td> <td style="text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">150.00</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">2013</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,612</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">121.88</div></div> </td> <td style="text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">596.25</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">2014</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">969</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">162.50 </div></div></td> <td style="text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">468.75</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">2015</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4,240</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">65.75 </div></div></td> <td style="text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">86.25</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1pt">2016</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">156,806</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="text-align: right; border-bottom: Black 1pt solid"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2.25 </div></div></td> <td style="text-align: center; border-bottom: Black 1pt solid"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">5.13</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 2.25pt; text-align: left">Total</td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="border-bottom: Black 2.5pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">165,643</div></td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="text-align: right; border-bottom: Black 2.5pt double"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$</div><div style="display: inline; font-size: 10pt">2.25 </div></td> <td style="text-align: center; border-bottom: Black 2.5pt double"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="border-bottom: Black 2.5pt double; text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">596.25</div></td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td> </tr> </table></div><div style="display: inline; font-family: times new roman; font-size: 10pt"><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif;"> <tr style="vertical-align: bottom"> <td nowrap="nowrap" style="text-align: left">Warrants:</td> <td> </td> <td nowrap="nowrap" colspan="3" style="text-align: center"> </td> <td> </td> <td nowrap="nowrap" colspan="5" style="text-align: center"> </td> </tr> <tr style="vertical-align: bottom"> <td nowrap="nowrap" style="text-align: left">Year</td> <td style="padding-bottom: 1pt"> </td> <td nowrap="nowrap" colspan="3" style="text-align: center; border-bottom: Black 1pt solid">Shares</td> <td style="padding-bottom: 1pt"> </td> <td nowrap="nowrap" colspan="5" style="text-align: center; border-bottom: Black 1pt solid">Price</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 67%; text-align: left">2012</td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2,792</div></td> <td style="width: 1%; text-align: left"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 5%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td style="width: 5%; text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">281.25</div></td> <td style="width: 5%; text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td style="width: 1%; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">2013</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10,703</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">93.75 </div></div></td> <td style="text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">371.25</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">2014</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">6,455</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">243.75 </div></div></td> <td style="text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">609.38</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">2015</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">94,152</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">0.00 </div></div></td> <td style="text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">243.75</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 1pt">2016</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">756,999</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="text-align: right; border-bottom: Black 1pt solid"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td style="text-align: center; border-bottom: Black 1pt solid"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4.46</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="padding-bottom: 2.25pt; text-align: left">Total</td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="border-bottom: Black 2.5pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">871,101</div></td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="text-align: right; border-bottom: Black 2.5pt double"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$</div><div style="display: inline; font-size: 10pt">0.00 </div></td> <td style="text-align: center; border-bottom: Black 2.5pt double"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="border-bottom: Black 2.5pt double; text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">609.38</div></td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td> </tr> </table></div>
-2.31
-30.86
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">NOTE <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">5</div> - LOSS PER SHARE</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The following table presents the shares used in the basic and diluted loss per common share computations:</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div> <table style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif;" cellspacing="0" cellpadding="0"> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td style="font-weight: bold"> </td> <td colspan="7" style="font-weight: bold; text-align: center" nowrap="nowrap">Year Ended<br /> December 31,</td> </tr> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid" nowrap="nowrap">2016</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid" nowrap="nowrap">2015</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td nowrap="nowrap">Numerator:</td> <td> </td> <td colspan="3" style="text-align: right" nowrap="nowrap"> </td> <td> </td> <td colspan="3" style="text-align: right" nowrap="nowrap"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="width: 70%; text-align: left">Net loss available in basic and diluted calculation</td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(6,526,014</div></td> <td style="width: 1%; text-align: left">)</td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(4,790,530</div></td> <td style="width: 1%; text-align: left">)</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 1pt">Other comprehensive income:</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1pt">Unrealized gain (loss) from marketable securities</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,501</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">-</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Comprehensive (loss)</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(6,524,513</div></td> <td style="text-align: left">)</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(4,790,530</div></td> <td style="text-align: left">)</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td>Denominator:</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td>Weighted average common shares outstanding-basic</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2,823,345</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">155,233</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Effect of dilutive stock options, warrants and preferred stock (1)</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">-</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">-</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 1pt">Weighted average common shares outstanding-basic</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2,823,345</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">155,233</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 2.25pt">Loss per common share-basic and diluted</td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(2.31</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left">)</td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(30.86</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left">)</td> </tr> </table> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(1)</div> The number of shares underlying options and warrants outstanding as of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015</div> are <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,036,744</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">354,449,</div> respectively. The number of shares underlying the preferred stock as of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> is <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">79,246.</div> The effect of the shares that would be issued upon exercise of such options, warrants and preferred stock has been excluded from the calculation of diluted loss per share because those shares are anti-dilutive.</div></div>
223205
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Fair Value Measurements</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Under generally accepted accounting principles as outlined in the Financial Accounting Standards Board’s <div style="display: inline; font-style: italic;">Accounting Standards Certification</div> (ASC) <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">820,</div> fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The accounting standards ASC <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">820</div> establishes a <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div>-level fair value hierarchy that prioritizes information used in developing assumptions when pricing an asset or liability as follows:</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Level <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1</div> – Observable inputs such as quoted prices in active markets;</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Level <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2</div> – Inputs other than quoted prices in active markets, that are observable either directly or indirectly; and</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: 0in">Level <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3</div> – Unobservable inputs where there is little or no market data, which requires the reporting entity to develop its own assumptions.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company uses observable market data, when available, in making fair value measurements. Fair value measurements are classified according to the lowest level input that is significant to the valuation.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The fair value of the Company’s investment securities were determined based on Level <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1</div> inputs.</div></div></div>
2387
-17076
5174799
3399339
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Valuation of Intangible Assets</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">We review identifiable intangible assets for impairment in accordance with ASC <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">350</div> — Intangibles —Goodwill and Other, whenever events or changes in circumstances indicate the carrying amount <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may</div> not be recoverable. Our intangible assets are currently solely the costs of obtaining trademarks and patents. Events or changes in circumstances that indicate the carrying amount <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may</div> not be recoverable include, but are not limited to, a significant change in the medical device marketplace and a significant adverse change in the business climate in which we operate. If such events or changes in circumstances are present, the undiscounted cash flows method is used to determine whether the intangible asset is impaired. Cash flows would include the estimated terminal value of the asset and exclude any interest charges. If the carrying value of the asset exceeds the undiscounted cash flows over the estimated remaining life of the asset, the asset is considered impaired, and the impairment is measured by reducing the carrying value of the asset to its fair value using the discounted cash flows method. The discount rate utilized is based on management’s best estimate of the related risks and return at the time the impairment assessment is made.</div></div></div>
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Intangible Assets</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Intangible assets consist of trademarks and patent costs. Amortization expense was <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$9,107</div> in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$6,291</div> in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015.</div> The assets are reviewed for impairment annually, and impairment losses, if any, are charged to operations when identified.</div></div></div>
274875
350372
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">NOTE <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">6–</div> INCOME TAXES </div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The provision for income taxes consists of an amount for taxes currently payable and a provision for tax consequences deferred to future periods. Deferred income taxes are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">There is <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">no </div>income tax provision in the accompanying statements of operations due to the cumulative operating losses that indicate a <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">100%</div> valuation allowance for the deferred tax assets and state income taxes is appropriate.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">During <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> September</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2013,</div> the Company experienced an "ownership change" as defined in Section <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">382</div> of the Internal Revenue Code which could potentially limit the ability to utilize the Company’s net operating losses (NOLs). The Company <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may</div> have experienced additional “ownership change(s)” since <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> September</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2013,</div> but a formal study has not yet been performed. The general limitation rules allow the Company to utilize its NOLs subject to an annual limitation that is determined by multiplying the federal long-term tax-exempt rate by the Company’s value immediately before the ownership change.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">At <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> the Company had approximately $ <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">24.7</div> million of gross NOLs to reduce future federal taxable income, the majority of which are expected to be available for use in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> subject to the Section <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">382</div> limitation described above. The federal NOLs will expire beginning in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2022</div> if unused. The Company also had approximately $ <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">13.4</div> million of gross NOLs to reduce future state taxable income at <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> which will expire in years <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2022</div> through <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2035</div> if unused. The Company’s net deferred tax assets, which include the NOLs are subject to a full valuation allowance. At <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> the federal and state valuation allowances were $ <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">9.6</div> million and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$1.1</div> million, respectively.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">At <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> the Company had approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$30.9</div> million of gross NOLs to reduce future federal taxable income, the majority of which are expected to be available for use in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2017,</div> subject to the Section <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">382</div> limitation described above. The federal NOLs will expire beginning in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2022</div> if unused. The Company also had approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$13.0</div> million of gross NOLs to reduce future state taxable income at <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> which will expire in years <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2022</div> through <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2036</div> if unused. The Company’s net deferred tax assets, which include the NOLs, are subject to a full valuation allowance. At <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> the federal and state valuation allowances were <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$10.7</div> million and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$0.2</div> million, respectively.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The valuation allowance has been recorded due to the uncertainty of realization of the benefits associated with the net operating losses. Future events and changes in circumstances could cause this valuation allowance to change.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <!-- Field: /Page --> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The components of deferred income taxes at <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015</div> are as follows:</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div> <table style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif;" cellspacing="0" cellpadding="0"> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid" nowrap="nowrap">December 31,<br /> 2016</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid" nowrap="nowrap">December 31,<br /> 2015</td> </tr> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td> </td> <td colspan="3" nowrap="nowrap"> </td> <td> </td> <td colspan="3" style="text-align: right" nowrap="nowrap"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Deferred Tax Asset:</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="width: 70%; text-align: left">Net Operating Loss</td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10,755,000</div></td> <td style="width: 1%; text-align: left"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10,338,000</div></td> <td style="width: 1%; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 1pt">Other</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">189,000</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">359,000</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Total Deferred Tax Asset</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10,944,000</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10,697,000</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 1pt">Less Valuation Allowance</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10,944,000</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10,697,000</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 2.25pt">Net Deferred Income Taxes</td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">—</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">—</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> </tr> </table> </div></div>
0
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Income Taxes</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company accounts for income taxes in accordance with ASC <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">740</div>- <div style="display: inline; font-style: italic;">Income Taxes (“ASC <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">740”)</div></div>. Under ASC <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">740,</div> deferred tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities and net operating loss and credit carryforwards using enacted tax rates in effect for the year in which the differences are expected to impact taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts expected to be realized.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company reviews income tax positions expected to be taken in income tax returns to determine if there are any income tax uncertainties. The Company recognizes tax benefits from uncertain tax positions only if it is more likely than not that the tax positions will be sustained on examination by taxing authorities, based on technical merits of the positions. The Company has identified no income tax uncertainties.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Tax years subsequent to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2013</div> remain open to examination by federal and state tax authorities.</div></div></div>
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<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Patents and Intellectual Property</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">25th,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2014,</div> the Company filed a non-provisional PCT Application No. <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">PCT/US2014/013081</div> claiming priority from the U.S. Provisional Patent Application, number <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">61756763</div> which was filed <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">one</div> year earlier on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">25th,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2013.</div> The Patent Cooperation Treaty (“PCT”) allows an applicant to file a single patent application to seek patent protection for an invention simultaneously in each of the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">148</div> countries of the PCT, including the United States. By filing this single “international” patent application through the PCT, it is easier and more cost effective than filing separate applications directly with each national or regional patent office in which patent protection is desired.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Our PCT patent application is for the new model of the surgical fluid waste management system. We obtained a favorable International Search Report from the PCT searching authority indicating that the claims in our PCT application are patentable (i.e., novel and non-obvious) over the cited prior art. A feature claimed in the PCT application is the ability to maintain continuous suction to the surgical field while measuring, recording and evacuating fluid to the facilities sewer drainage system. This provides for continuous operation of the STREAMWAY System unit in suctioning waste fluids, which means that suction is not interrupted during a surgical operation, for example, to empty a fluid collection container or otherwise dispose of the collected fluid.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company holds the following granted patents in the United States and a pending application in the United States on its earlier models: <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">US7469727,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">US8123731</div> and U.S. Publication No. <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">US20090216205</div> (collectively, the “Patents”). These Patents will begin to expire on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> August</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">8,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2023.</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <!-- Field: /Page --> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> July</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> Skyline Medical filed an international (PCT) patent application for its fluid waste collection system and received a favorable determination by the International Searching Authority finding that all of the claims satisfy the requirements for novelty, inventive step and industrial applicability. Skyline anticipates that the favorable International Search Report will result in allowance of its various national applications.</div></div></div>
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272208
231740
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Inventories</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Inventories are stated at the lower of cost or market, with cost determined on a <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">first</div>-in, <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">first</div>-out basis. Inventory balances are as follows:</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div> <table style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif;" cellspacing="0" cellpadding="0"> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td style="font-weight: bold"> </td> <td colspan="3" style="font-weight: bold; text-align: center" nowrap="nowrap">December 31,</td> <td style="font-weight: bold"> </td> <td colspan="3" style="font-weight: bold; text-align: center" nowrap="nowrap">December 31,</td> </tr> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid" nowrap="nowrap">2016</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid" nowrap="nowrap">2015</td> </tr> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td> </td> <td colspan="3" nowrap="nowrap"> </td> <td> </td> <td colspan="3" style="text-align: right" nowrap="nowrap"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 70%; text-align: left">Finished goods</td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">38,201</div></td> <td style="width: 1%; text-align: left"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">30,237</div></td> <td style="width: 1%; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Raw materials</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">165,812</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">162,623</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 1pt">Work-In-Process</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">68,195</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">38,880</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="padding-bottom: 2.25pt">Total</td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">272,208</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">231,740</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> </tr> </table> </div></div></div>
165812
162623
68195
38880
66239
66345
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">NOTE <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">7</div> – RENT OBLIGATION</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company leases its principal office under a lease that can be cancelled after <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div> years with proper notice per the lease and an amortized schedule of adjustments that will be due to the landlord. The lease extends <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">five</div> years and expires <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2018.</div> In addition to rent, the Company pays real estate taxes and repairs and maintenance on the leased property. Rent expense was <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$66,239</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$66,345</div> for <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> respectively.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company’s rent obligation for the next <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div> years are as follows:</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div> <table style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif;" cellspacing="0" cellpadding="0"> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 85%; text-align: left">2017</td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">39,000</div></td> <td style="width: 1%; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">2018</td> <td> </td> <td style="text-align: left">$</td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3,000</div></td> <td style="text-align: left"> </td> </tr> </table> </div></div>
1883864
1519708
2807546
5632419
1574215
1519708
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Investment Securities</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;"> </div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Readily marketable investments in debt and equity services are classified as available-for-sale and are reported at fair value with unrealized gains losses recorded in other comprehensive income. Unrealized gains are charged to earnings when an incline in fair value above the cost basis is determined to be other-than-temporary. Realized gains and losses on dispositions are based on the net proceeds and the adjusted book value of the securities sold, using the specific identification method.</div></div></div>
1712158
12387706
-422860
-60565
-4381440
-7487293
-6526014
-4790530
-4790530
-6526014
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><div style="display: inline; font-weight: bold;">Recent Accounting Developments</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> May</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2014,</div> the Financial Accounting Standards Board (“FASB”) issued ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2014</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">09,</div> <div style="display: inline; font-style: italic;">Revenue from Contracts with Customers </div>and created a new topic in the FASB Accounting Standards Codification ("ASC"), Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">606,</div> and has since amended the standard with ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">14,</div> <div style="display: inline; font-style: italic;">“Revenue from Contracts with Customers: Deferral of the Effective Date,”</div> ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">08,</div> <div style="display: inline; font-style: italic;">“Revenue from Contracts with Customers: Principal versus Agent Considerations (Reporting Revenue Gross versus Net),” </div>ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10,</div> <div style="display: inline; font-style: italic;">“Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing,” </div>and ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">12,</div> <div style="display: inline; font-style: italic;">“Revenue from Contracts with Customers: Narrow-Scope Improvements and Practical Expedients.”</div>. These new standards provide a single comprehensive revenue recognition framework for all entities and supersedes nearly all existing U.S. GAAP revenue recognition guidance, including industry-specific guidance. The core principle of the revenue model is that an entity should recognize revenue in a manner that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard is designed to create greater comparability for financial statement users across industries and also requires enhanced disclosures. The amendments are effective for annual reporting periods beginning after <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2017,</div> including interim periods within that reporting period. Early application is not permitted. ”The FASB allows <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">two</div> adoption methods under ASC <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">606.</div> We currently plan to adopt the standard using the “modified retrospective method.” Under that method, we will apply the rules to all contracts existing as of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2018,</div> recognizing in the beginning retained earnings an adjustment for the cumulative effect of the change and providing additional disclosure comparing results to previous accounting standards. Upon initial evaluation, we believe the requirements of this standard will not result in a significant change to our results.”</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> June</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2014,</div> the FASB issued ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2014</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">12,</div> <div style="display: inline; font-style: italic;">"Compensation - Stock Compensation" </div>providing explicit guidance on how to account for share-based payments granted to employees in which the terms of the award provide that a performance target that affects vesting could be achieved after the requisite service period. The amendments in this Update are effective for annual periods and interim periods within those annual periods beginning after <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015.</div> Early adoption is permitted. We are currently evaluating the impact this guidance <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may</div> have on our financial statements.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> August</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2014,</div> the FASB issued ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2014</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic;">Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern</div>. The new standard requires management to assess an entity’s ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. The standard is effective for public entities for annual and interim periods beginning after <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> with early adoption permitted. We are currently evaluating the impact this guidance <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may</div> have on our financial statements.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525">In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> April</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> the FASB issued ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">03,</div> <div style="display: inline; font-style: italic;">Simplifying the Presentation of Debt Issuance Costs</div>. Debt issuance costs related to a recognized debt liability will be presented on the balance sheet as a direct deduction from the debt liability, similar to the presentation of debt discounts, rather than as an asset. Amortization of these costs will continue to be reported as interest expense. ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">03</div> is effective for annual and interim reporting periods beginning after <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015.</div> Early adoption is permitted. The adoption of this ASU is not expected to have an impact on our financial statements.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525">In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> July</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> the FASB issued ASU No. <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">11</div><div style="display: inline; font-style: italic;">, Inventory (Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">330):</div> Simplifying the Measurement of Inventory</div>, requiring that inventory be measured at the lower of cost and net realizable value. Net realizable value is defined as estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. This ASU is effective within annual periods beginning on or after <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> including interim periods within that reporting period. We are currently evaluating the impact this guidance <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may</div> have on our financial statements.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525">In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> November</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> the FASB issued ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">17,</div> <div style="display: inline; font-style: italic;">“Income Taxes (Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">740)”</div> </div>providing guidance on the balance sheet classification of deferred taxes. The guidance requires that deferred tax assets and liabilities to be classified as noncurrent in the Balance Sheet. The guidance is effective for fiscal years beginning after <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> and for interim periods within those fiscal years, with early adoption permitted. We are currently evaluating the impact this guidance <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may</div> have on our financial statements.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525"> </div> <!-- Field: /Page --> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525"></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525">In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> the FASB issued ASU No. <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">01,</div> <div style="display: inline; font-style: italic;">Financial Instruments-Overall (Subtopic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">825</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10):</div> Recognition and Measurement of Financial Assets and Financial Liabilities </div>(“ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">01”).</div> The standard changes how entities measure certain equity investments and present changes in the fair value of financial liabilities measured under the fair value option that are attributable to their own credit. Under the new guidance, entities will be required to measure equity investments that do not result in consolidation and are not accounted for under the equity method at fair value and recognize any changes in fair value in net income unless the investments qualify for the new practicability exception. The standard is effective for fiscal years beginning after <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2017,</div> including interim periods within those fiscal years. The Company does not believe that the adoption of this guidance will have a material impact on the Company’s financial statements and disclosures.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525">In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> February</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> the FASB issued ASU No. <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">02,</div> “Leases <div style="display: inline; font-style: italic;">(Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">842”</div> </div>(“ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">02”),</div> which requires lessees to put most leases on their balance sheets but recognize the expenses on their income statements in a manner similar to current practice. The standard states that a lessee would recognize a lease liability for the obligation to make lease payments and a right-to-use asset for the right to use the underlying asset for the lease term. The standard is effective for fiscal years and interim periods within those fiscal years beginning after <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2018.</div> Early adoption is permitted. We are currently evaluating the timing of our adoption and the impact that the updated standard will have on our financial statements.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525">In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> the FASB issued ASU No. <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">09,</div> <div style="display: inline; font-style: italic;">“Compensation (Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">718):</div> Improvements to Employee Shares-Based Payment Accounting” </div><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(“ASU2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">09”).</div> ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">09</div> simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The standard is effective for fiscal years and interim periods within those fiscal years beginning after <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016.</div> Early adoption is permitted. We are currently evaluating the timing of our adoption and the impact that the updated standard will have on our financial statements.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525">During <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> August</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> the FASB issued ASU No. <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic;">Statement of Cash Flows (Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">230):</div> Classification of Certain Cash Receipts and Cash Payments, </div>to address diversity in how certain cash receipts and cash payments are presented and classified in the statements of cash flows. The amendments are effective for public business entities for fiscal years beginning after <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2017,</div> and interim periods within those fiscal years. The amendments should be applied using a retrospective transition method to each period presented. If retrospective application is impractical for some of the issues addressed by the update, the amendments for those issues would be applied prospectively as of the earliest date practicable. Early adoption is permitted, including adoption in an interim period. The Company does not expect the adoption of ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15</div> to have a material impact on its financial statements.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525">We reviewed all other significant newly issued accounting pronouncements and determined they are either not applicable to our business or that no material effect is expected on our financial position and results of our operations.</div></div></div>
1
2013
1158117
846687
39000
3000
24700000
13400000
30900000
13000000
9600000
1100000
10700000
200000
1501
1501
11987
28095
850000
32760
32470
1100000
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">NOTE <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">9</div> – RETIREMENT SAVINGS PLANS</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">We have a pre-tax salary reduction/profit-sharing plan under the provisions of Section <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">401(k)</div> of the Internal Revenue Code, which covers employees meeting certain eligibility requirements. In fiscal <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> and again in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> we matched <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">100%</div>,</div> of the employee’s contribution up to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4.0%</div></div> of their earnings. The employer contribution was <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$33,143</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$39,916</div> in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015.</div> There were no discretionary contributions to the plan in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015.</div></div></div>
0.06
0.06
243.75
243.75
243.75
0.01
0.01
20000000
20000000
79246
1895010
792
18950
148637
271579
1475000
100000
250000
1712158
13051830
18950
13800000
1983337
3937500
358312
571887
34665
56201
164318
153553
25635
23874
103204
97288
23236
8962
316393
283677
101496
139598
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Property and Equipment</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation of property and equipment is computed using the straight-line method over the estimated useful lives of the respective assets. Estimated useful asset life by classification is as follows:</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div> <table style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif;" cellspacing="0" cellpadding="0"> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td> </td> <td colspan="5" style="text-align: center" nowrap="nowrap">Years</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Computers and office equipment</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3 </div></td> <td style="text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">- </div></td> <td style="text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">7</div></div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="width: 82%; text-align: left">Leasehold improvements</td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 5%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td style="width: 5%; text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">5</div></td> <td style="width: 5%; text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td style="width: 1%; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Manufacturing Tooling</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3 </div></td> <td style="text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">- </div></td> <td style="text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">7</div></div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Demo Equipment</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td style="text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3</div></td> <td style="text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td style="text-align: left"> </td> </tr> </table> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company’s investment in Fixed Assets consists of the following:</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div> <table style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif;" cellspacing="0" cellpadding="0"> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid" nowrap="nowrap">December 31,<br /> 2016</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid" nowrap="nowrap">December 31,<br /> 2015</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 70%; text-align: left">Computers and office equipment</td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">164,318</div></td> <td style="width: 1%; text-align: left"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">153,553</div></td> <td style="width: 1%; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Leasehold Improvements</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">25,635</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">23,874</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Manufacturing Tooling</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">103,204</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">97,288</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1pt">Demo Equipment</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">23,236</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">8,962</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 10pt">Total</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">316,393</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">283,677</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1pt">Less: Accumulated Depreciation</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">214,897</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">144,079</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 2.25pt; padding-left: 10pt">Total Fixed Assets, Net</td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">101,496</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">139,598</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> </tr> </table> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Upon retirement or sale, the cost and related accumulated depreciation are removed from the balance sheet and the resulting gain or loss is reflected in operations. Maintenance and repairs are charged to operations as incurred.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Depreciation expense was <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$73,249</div> in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$72,275</div> in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015.</div></div></div></div>
<div style="display: inline; font-family: times new roman; font-size: 10pt"><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif;"> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td nowrap="nowrap" colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">December 31,<br /> 2016</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td nowrap="nowrap" colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">December 31,<br /> 2015</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 70%; text-align: left">Computers and office equipment</td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">164,318</div></td> <td style="width: 1%; text-align: left"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">153,553</div></td> <td style="width: 1%; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Leasehold Improvements</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">25,635</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">23,874</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Manufacturing Tooling</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">103,204</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">97,288</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1pt">Demo Equipment</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">23,236</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">8,962</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 10pt">Total</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">316,393</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">283,677</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1pt">Less: Accumulated Depreciation</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">214,897</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">144,079</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 2.25pt; padding-left: 10pt">Total Fixed Assets, Net</td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">101,496</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">139,598</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> </tr> </table></div>
P3Y
P7Y
P5Y
P3Y
P7Y
P3Y
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Receivables</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Receivables are reported at the amount the Company expects to collect on balances outstanding. The Company provides for probable uncollectible amounts through charges to earnings and credits to the valuation based on management’s assessment of the current status of individual accounts, changes to the valuation allowance have not been material to the financial statements.</div></div></div>
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">NOTE <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">8</div> - RELATED PARTY TRANSACTIONS</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Audit Committee has the responsibility to review and approve all transactions to which a related party and the Company <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may</div> be a party prior to their implementation, to assess whether such transactions meet applicable legal requirements. Rick Koenigsberger, a former director, is a holder of membership units in SOK Partners.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">In connection with the sale of the Series A Preferred Shares on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> February</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2014,</div> Joshua Kornberg, our President, Chief Executive Officer and Interim Chairman of the Board, was <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">one</div> of the purchasers. Mr. Kornberg purchased <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">19,231</div> Series A Preferred Shares for a purchase price of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$25,000</div> and received warrants to purchase <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">52</div> shares of common stock.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">SOK Partners, LLC (“SOK”), a <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10%</div> stockholder with Mr. Kornberg and Dr. Samuel Herschkowitz as managing partners, invested in the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> July</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2014</div> offering of convertible notes and warrants. In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> November</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2014,</div> the convertible noteholders agreed to convert certain balances of the convertible notes in connection with the public offering of the Existing Units, in consideration of the agreement to issue certain additional shares. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources – History Financing – <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2014</div> Sales of Convertible Notes and Warrants.” In connection with the Unit Offering in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> August</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> all such convertible notes were redeemed at a redemption price of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">140%</div> of the principal amount thereof, plus accrued and unpaid interest. The Company paid approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$163,000</div> to SOK in redemption of its convertible note. In addition, Rick Koenigsberger, a former director who resigned on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> June</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">5,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> is a holder of membership units of SOK Partners.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">In connection with the Unit Exchange that was consummated on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> August</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">250</div> shares of Series A Convertible Stock held by Mr. Kornberg were exchanged for <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2,778</div> Exchange Units.</div></div>
163000
406000
261000
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><div style="display: inline; font-weight: bold;">Research and Development</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Research and development costs are charged to operations as incurred. Research and development costs were approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$406,000</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$261,000</div> for <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> respectively.</div></div></div>
-47018451
-40492437
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Revenue Recognition</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;"> </div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company recognizes revenue in accordance with the SEC’s Staff Accounting Bulletin Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">13</div> Revenue Recognition and ASC <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">605</div>- Revenue Recognition.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 27.5pt"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed and determinable and collectability is probable. Delivery is considered to have occurred upon either shipment of the product or arrival at its destination based on the shipping terms of the transaction. The Company’s standard terms specify that shipment is FOB Skyline and the Company will, therefore, recognize revenue upon shipment in most cases. This revenue recognition policy applies to shipments of the STREAMWAY SYSTEM units as well as shipments of cleaning solution kits. When these conditions are satisfied, the Company recognizes gross product revenue, which is the price it charges generally to its customers for a particular product. Under the Company’s standard terms and conditions, there is no provision for installation or acceptance of the product to take place prior to the obligation of the customer. The customer’s right of return is limited only to the Company’s standard <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">one</div>-year warranty whereby the Company replaces or repairs, at its option, and it would be rare that the STREAMWAY SYSTEM unit or significant quantities of cleaning solution kits <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may</div> be returned. Additionally, since the Company buys both the STREAMWAY SYSTEM units and cleaning solution kits from “turnkey” suppliers, the Company would have the right to replacements from the suppliers if this situation should occur.</div></div></div>
0
0
456495
654354
<div style="display: inline; font-family: times new roman; font-size: 10pt"><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif;"> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td nowrap="nowrap" colspan="15" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">December 31, 2016</td> </tr> <tr style="vertical-align: bottom"> <td nowrap="nowrap" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Description</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td nowrap="nowrap" colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Cost</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td nowrap="nowrap" colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Gross <br /> Unrealized <br /> Gains</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td nowrap="nowrap" colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Gross <br /> Unrealized <br /> Losses</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td nowrap="nowrap" colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Fair Value</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="width: 48%"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 10%; text-align: right"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 10%; text-align: right"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 10%; text-align: right"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 10%; text-align: right"> </td> <td style="width: 1%; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 2.25pt">Mutual Funds</td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">282,828</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,501</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">-</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">284,329</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> </tr> </table></div>
<div style="display: inline; font-family: times new roman; font-size: 10pt"><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif;"> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td nowrap="nowrap" colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">December 31,<br /> 2016</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td nowrap="nowrap" colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">December 31,<br /> 2015</td> </tr> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td> </td> <td nowrap="nowrap" colspan="3"> </td> <td> </td> <td nowrap="nowrap" colspan="3" style="text-align: right"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Deferred Tax Asset:</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="width: 70%; text-align: left">Net Operating Loss</td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10,755,000</div></td> <td style="width: 1%; text-align: left"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10,338,000</div></td> <td style="width: 1%; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 1pt">Other</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">189,000</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">359,000</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Total Deferred Tax Asset</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10,944,000</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10,697,000</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 1pt">Less Valuation Allowance</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10,944,000</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10,697,000</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 2.25pt">Net Deferred Income Taxes</td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">—</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">—</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> </tr> </table></div>
<div style="display: inline; font-family: times new roman; font-size: 10pt"><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif;"> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td style="font-weight: bold"> </td> <td nowrap="nowrap" colspan="7" style="font-weight: bold; text-align: center">Year Ended<br /> December 31,</td> </tr> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td nowrap="nowrap" colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2016</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td nowrap="nowrap" colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2015</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td nowrap="nowrap">Numerator:</td> <td> </td> <td nowrap="nowrap" colspan="3" style="text-align: right"> </td> <td> </td> <td nowrap="nowrap" colspan="3" style="text-align: right"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="width: 70%; text-align: left">Net loss available in basic and diluted calculation</td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(6,526,014</div></td> <td style="width: 1%; text-align: left">)</td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(4,790,530</div></td> <td style="width: 1%; text-align: left">)</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 1pt">Other comprehensive income:</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1pt">Unrealized gain (loss) from marketable securities</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,501</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">-</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Comprehensive (loss)</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(6,524,513</div></td> <td style="text-align: left">)</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(4,790,530</div></td> <td style="text-align: left">)</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td>Denominator:</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td>Weighted average common shares outstanding-basic</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2,823,345</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">155,233</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Effect of dilutive stock options, warrants and preferred stock (1)</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">-</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">-</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 1pt">Weighted average common shares outstanding-basic</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2,823,345</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">155,233</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 2.25pt">Loss per common share-basic and diluted</td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(2.31</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left">)</td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(30.86</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left">)</td> </tr> </table></div>
<div style="display: inline; font-family: times new roman; font-size: 10pt"><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif;"> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td style="font-weight: bold"> </td> <td nowrap="nowrap" colspan="3" style="font-weight: bold; text-align: center">December 31,</td> <td style="font-weight: bold"> </td> <td nowrap="nowrap" colspan="3" style="font-weight: bold; text-align: center">December 31,</td> </tr> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td nowrap="nowrap" colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2016</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td nowrap="nowrap" colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2015</td> </tr> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td> </td> <td nowrap="nowrap" colspan="3"> </td> <td> </td> <td nowrap="nowrap" colspan="3" style="text-align: right"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 70%; text-align: left">Finished goods</td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">38,201</div></td> <td style="width: 1%; text-align: left"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">30,237</div></td> <td style="width: 1%; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Raw materials</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">165,812</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">162,623</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 1pt">Work-In-Process</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">68,195</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">38,880</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="padding-bottom: 2.25pt">Total</td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">272,208</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">231,740</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> </tr> </table></div>
<div style="display: inline; font-family: times new roman; font-size: 10pt"><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif;"> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 85%; text-align: left">2017</td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">39,000</div></td> <td style="width: 1%; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">2018</td> <td> </td> <td style="text-align: left">$</td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3,000</div></td> <td style="text-align: left"> </td> </tr> </table></div>
<div style="display: inline; font-family: times new roman; font-size: 10pt"><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif;"> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td style="font-weight: bold"> </td> <td nowrap="nowrap" colspan="7" style="font-weight: bold; text-align: center">Stock Options</td> <td style="font-weight: bold"> </td> <td nowrap="nowrap" colspan="7" style="font-weight: bold; text-align: center">Warrants</td> </tr> <tr style="vertical-align: bottom"> <td nowrap="nowrap" style="text-align: center"> </td> <td style="font-weight: bold"> </td> <td nowrap="nowrap" colspan="3" style="font-weight: bold; text-align: center">Number of<br /> Shares</td> <td style="font-weight: bold"> </td> <td nowrap="nowrap" colspan="3" style="font-weight: bold; text-align: center">Average <br /> Exercise <br /> Price</td> <td style="font-weight: bold"> </td> <td nowrap="nowrap" colspan="3" style="font-weight: bold; text-align: center">Number of<br /> Shares</td> <td style="font-weight: bold"> </td> <td nowrap="nowrap" colspan="3" style="font-weight: bold; text-align: center">Average <br /> Exercise <br /> Price</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 48%">Outstanding at December 31, 2014</td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 10%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">17,945</div></td> <td style="width: 1%; text-align: left"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 10%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">187.75</div></td> <td style="width: 1%; text-align: left"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 10%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">20,029</div></td> <td style="width: 1%; text-align: left"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 10%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">198.75</div></td> <td style="width: 1%; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td>Issued</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">14,171</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">69.00</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">303,269</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">123.75</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td>Expired</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(766</div></td> <td style="text-align: left">)</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">293.25</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(79</div></td> <td style="text-align: left">)</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">283.50</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 1pt">Exercised</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">-</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">-</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(120</div></td> <td style="border-bottom: Black 1pt solid; text-align: left">)</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">123.75</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td>Outstanding at December 31, 2015</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,350</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left">$</td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">133.23</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">323,099</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left">$</td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">128.40</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td>Issued</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">157,982</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3.14</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,487,881</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">0.71</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td>Cancelled</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(22,377</div></td> <td style="text-align: left">)</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">122.13</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">-</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">-</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 1pt">Exercised</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(1,312</div></td> <td style="border-bottom: Black 1pt solid; text-align: left">)</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">65.75</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(939,879</div></td> <td style="border-bottom: Black 1pt solid; text-align: left">)</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">-</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 2.25pt">Outstanding at December 31, 2016</td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">165,643</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">11.22</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">871,101</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">52.22</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> </tr> </table></div>
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><div style="display: inline; font-weight: bold;">Schedule II</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><div style="display: inline; font-weight: bold;">Valuation and Qualifying Accounts</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(None)</div></div>
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Segments</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company operates in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">one</div> segment for the sale of its medical device and consumable products. Substantially all of the Company’s assets, revenues, and expenses for <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015</div> were located at or derived from operations in the United States. There were no revenues from sales outside of the United States.</div></div></div>
467970
503989
165271
871877
P3Y
283.50
123.75
0.71
198.75
128.40
52.22
0
0
0.66
0.66
0.59
0.59
0.0163
0.0235
0.0146
0.0245
120
939879
79
303269
1487881
20029
323099
871101
766
22377
40000
14171
157982
1.6329
3.7195
69
3.14
293
37152
57145
44000
3636
7147
3529
3902
342
1157
2323
187
232
5
81
928
1760
123
121
121
130
529
3
72
306
133
188
53
45
165643
17945
31350
165643
175
1841
1612
969
4240
156806
2.25
2.42
2.80
3.75
4.125
4.1975
4.25
5.125
65.75
73.50
77.50
80.25
86.25
121.875
131.25
148.125
150
162.50
206.25
248.4375
262.50
281.25
318.75
346.875
431.25
468.75
506.25
543.75
596.25
187.75
133.23
11.22
71209
21.62
65.75
65.75
293.25
122.13
6.875
139.2375
3.75
281.25
131.25
150
121.88
596.25
162.50
468.75
65.75
86.25
2.25
5.13
2.25
596.25
P10Y
3131.25
4.125
2.62
2.25
P3Y
P10Y
P5Y
P10Y
P5Y
P9Y237D
P9Y233D
P10Y
P9Y182D
P9Y273D
P9Y262D
P9Y91D
P9Y251D
P8Y295D
P9Y3D
P8Y182D
P8Y273D
P8Y91D
P6Y73D
P5Y251D
P6Y76D
P5Y229D
P8Y3D
P7Y273D
P6Y197D
P6Y197D
P6Y14D
P6Y127D
P7Y91D
P7Y69D
P7Y54D
P7Y
P6Y281D
P6Y273D
P9Y120D
3.75
4.50
4.50
9
123711
208259
4564428
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Shipping and Handling</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Shipping and handling charges billed to customers are recorded as revenue. Shipping and handling costs are recorded within cost of goods sold on the statement of operations.</div></div></div>
0
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">NOTE <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4</div> – SHORT-TERM NOTES PAYABLE</div> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;"> </div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">From <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> July</div> through <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> September</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2014,</div> we entered into a series of securities purchase agreements pursuant to which we issued approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$1.8</div> million original principal amount (subsequently reduced to approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$1.6</div> million aggregate principal amount in accordance with their terms) of convertible promissory notes (the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">“2014</div> Convertible Notes”) and warrants exercisable for shares of our common stock for an aggregate purchase price of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$1,475,000.</div> Of this amount, we issued to SOK Partners, LLC, an affiliate of the Company, <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$122,196</div> original principal amount of the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2014</div> Convertible Notes and warrants exercisable for <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">5,431</div> shares of our common stock for an aggregate purchase price of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$100,000.</div> In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> April</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> May</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> we issued and sold to a private investor additional Convertible Notes in an aggregate original principal amount of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$275,000</div> for an aggregate purchase price of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$250,000,</div> containing terms substantially similar to the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2014</div> Convertible Notes (the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">“2015</div> Convertible Notes” and, together with the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2014</div> Convertible Notes, the “Convertible Notes”). No warrants were issued with the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015</div> Convertible Notes.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Under a provision in the existing agreements, upon effectiveness of a resale registration statement covering certain shares, on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> September</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">9,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2014,</div> the principal amount of the notes was reduced by <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">11%,</div> to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$1,603,260</div> and the number of Warrants was reduced by <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">11%,</div> to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2,851</div> shares.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">In connection with the Offering, the holders of the Convertible Notes agreed to not exercise their right to convert the Convertible Notes into shares of the Company’s common stock, in exchange for the Company’s agreement to redeem all of the outstanding Convertible Notes promptly following the consummation of the Offering at a redemption price equal to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">140%</div> of the principal amount, plus accrued and unpaid interest to the redemption date. On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> August</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> the closing date of the offering, the Company redeemed the remaining <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$933,074</div> aggregate principal amount of Convertible Notes plus interest and a <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">40%</div> redeemable premium, for a total payment of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$1,548,792.</div> Of this amount, approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$167,031</div> was paid to its affiliates in redemption of their Convertible Notes. Each holder of the Convertible Notes agreed to the foregoing terms and entered into an Amendment to Senior Convertible Notes and Agreement with the Company. As of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> none of the Convertible Notes were outstanding.</div></div>
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">NOTE <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1</div> — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Nature of Operations and Continuance of Operations</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Skyline Medical Inc. (the "Company") was incorporated under the laws of the State of Minnesota in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2002.</div> Effective <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> August</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">6,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2013,</div> the Company changed its name to Skyline Medical Inc. As of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> the registrant had <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4,564,428</div> shares of common stock, par value <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$.01</div> per share, outstanding, adjusted for a <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1</div>-for-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">25</div> reverse stock split effective <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> October</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">27,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016.</div> In this Report, all numbers of shares and per share amounts, as appropriate, have been stated to reflect the reverse stock split. Pursuant to an Agreement and Plan of Merger dated effective <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">16,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2013,</div> the Company merged with and into a Delaware corporation with the same name that was its wholly-owned subsidiary, with such Delaware Corporation as the surviving corporation of the merger. The Company has developed an environmentally safe system for the collection and disposal of infectious fluids that result from surgical procedures and post-operative care. The Company also makes ongoing sales of our proprietary cleaning fluid and filters to users of our systems. In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> April</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2009,</div> the Company received <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">510(k)</div> clearance from the FDA to authorize the Company to market and sell its STREAMWAY SYSTEM products.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The accompanying financial statements have been prepared assuming the Company will continue as a going concern. The Company has suffered recurring losses from operations and had a stockholders’ deficit until <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> August</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015</div> whereupon the Company closed its public offering of units of common stock, Series B Convertible Preferred Stock and Series A Warrants (the “Units”). There remains though, substantial doubt about its ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Since inception to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> the Company raised approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$23,950,996</div> in equity, inclusive of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$2,055,000</div> from a private placement of Series A Convertible Preferred Stock, <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$13,555,003</div> from the public offering of Units, <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$1,739,770</div> from a registered direct offering and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$5,685,000</div> in debt financing. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources.”</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><div style="display: inline; font-weight: bold;">Recent Accounting Developments</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> May</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2014,</div> the Financial Accounting Standards Board (“FASB”) issued ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2014</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">09,</div> <div style="display: inline; font-style: italic;">Revenue from Contracts with Customers </div>and created a new topic in the FASB Accounting Standards Codification ("ASC"), Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">606,</div> and has since amended the standard with ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">14,</div> <div style="display: inline; font-style: italic;">“Revenue from Contracts with Customers: Deferral of the Effective Date,”</div> ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">08,</div> <div style="display: inline; font-style: italic;">“Revenue from Contracts with Customers: Principal versus Agent Considerations (Reporting Revenue Gross versus Net),” </div>ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10,</div> <div style="display: inline; font-style: italic;">“Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing,” </div>and ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">12,</div> <div style="display: inline; font-style: italic;">“Revenue from Contracts with Customers: Narrow-Scope Improvements and Practical Expedients.”</div>. These new standards provide a single comprehensive revenue recognition framework for all entities and supersedes nearly all existing U.S. GAAP revenue recognition guidance, including industry-specific guidance. The core principle of the revenue model is that an entity should recognize revenue in a manner that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard is designed to create greater comparability for financial statement users across industries and also requires enhanced disclosures. The amendments are effective for annual reporting periods beginning after <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2017,</div> including interim periods within that reporting period. Early application is not permitted. ”The FASB allows <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">two</div> adoption methods under ASC <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">606.</div> We currently plan to adopt the standard using the “modified retrospective method.” Under that method, we will apply the rules to all contracts existing as of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2018,</div> recognizing in the beginning retained earnings an adjustment for the cumulative effect of the change and providing additional disclosure comparing results to previous accounting standards. Upon initial evaluation, we believe the requirements of this standard will not result in a significant change to our results.”</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> June</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2014,</div> the FASB issued ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2014</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">12,</div> <div style="display: inline; font-style: italic;">"Compensation - Stock Compensation" </div>providing explicit guidance on how to account for share-based payments granted to employees in which the terms of the award provide that a performance target that affects vesting could be achieved after the requisite service period. The amendments in this Update are effective for annual periods and interim periods within those annual periods beginning after <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015.</div> Early adoption is permitted. We are currently evaluating the impact this guidance <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may</div> have on our financial statements.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> August</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2014,</div> the FASB issued ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2014</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic;">Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern</div>. The new standard requires management to assess an entity’s ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. The standard is effective for public entities for annual and interim periods beginning after <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> with early adoption permitted. We are currently evaluating the impact this guidance <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may</div> have on our financial statements.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525">In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> April</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> the FASB issued ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">03,</div> <div style="display: inline; font-style: italic;">Simplifying the Presentation of Debt Issuance Costs</div>. Debt issuance costs related to a recognized debt liability will be presented on the balance sheet as a direct deduction from the debt liability, similar to the presentation of debt discounts, rather than as an asset. Amortization of these costs will continue to be reported as interest expense. ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">03</div> is effective for annual and interim reporting periods beginning after <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015.</div> Early adoption is permitted. The adoption of this ASU is not expected to have an impact on our financial statements.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525">In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> July</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> the FASB issued ASU No. <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">11</div><div style="display: inline; font-style: italic;">, Inventory (Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">330):</div> Simplifying the Measurement of Inventory</div>, requiring that inventory be measured at the lower of cost and net realizable value. Net realizable value is defined as estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. This ASU is effective within annual periods beginning on or after <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> including interim periods within that reporting period. We are currently evaluating the impact this guidance <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may</div> have on our financial statements.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525">In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> November</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> the FASB issued ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">17,</div> <div style="display: inline; font-style: italic;">“Income Taxes (Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">740)”</div> </div>providing guidance on the balance sheet classification of deferred taxes. The guidance requires that deferred tax assets and liabilities to be classified as noncurrent in the Balance Sheet. The guidance is effective for fiscal years beginning after <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> and for interim periods within those fiscal years, with early adoption permitted. We are currently evaluating the impact this guidance <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may</div> have on our financial statements.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525"> </div> <!-- Field: /Page --> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525"></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525">In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> the FASB issued ASU No. <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">01,</div> <div style="display: inline; font-style: italic;">Financial Instruments-Overall (Subtopic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">825</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10):</div> Recognition and Measurement of Financial Assets and Financial Liabilities </div>(“ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">01”).</div> The standard changes how entities measure certain equity investments and present changes in the fair value of financial liabilities measured under the fair value option that are attributable to their own credit. Under the new guidance, entities will be required to measure equity investments that do not result in consolidation and are not accounted for under the equity method at fair value and recognize any changes in fair value in net income unless the investments qualify for the new practicability exception. The standard is effective for fiscal years beginning after <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2017,</div> including interim periods within those fiscal years. The Company does not believe that the adoption of this guidance will have a material impact on the Company’s financial statements and disclosures.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525">In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> February</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> the FASB issued ASU No. <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">02,</div> “Leases <div style="display: inline; font-style: italic;">(Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">842”</div> </div>(“ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">02”),</div> which requires lessees to put most leases on their balance sheets but recognize the expenses on their income statements in a manner similar to current practice. The standard states that a lessee would recognize a lease liability for the obligation to make lease payments and a right-to-use asset for the right to use the underlying asset for the lease term. The standard is effective for fiscal years and interim periods within those fiscal years beginning after <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2018.</div> Early adoption is permitted. We are currently evaluating the timing of our adoption and the impact that the updated standard will have on our financial statements.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525">In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> the FASB issued ASU No. <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">09,</div> <div style="display: inline; font-style: italic;">“Compensation (Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">718):</div> Improvements to Employee Shares-Based Payment Accounting” </div><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(“ASU2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">09”).</div> ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">09</div> simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The standard is effective for fiscal years and interim periods within those fiscal years beginning after <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016.</div> Early adoption is permitted. We are currently evaluating the timing of our adoption and the impact that the updated standard will have on our financial statements.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525">During <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> August</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> the FASB issued ASU No. <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic;">Statement of Cash Flows (Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">230):</div> Classification of Certain Cash Receipts and Cash Payments, </div>to address diversity in how certain cash receipts and cash payments are presented and classified in the statements of cash flows. The amendments are effective for public business entities for fiscal years beginning after <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2017,</div> and interim periods within those fiscal years. The amendments should be applied using a retrospective transition method to each period presented. If retrospective application is impractical for some of the issues addressed by the update, the amendments for those issues would be applied prospectively as of the earliest date practicable. Early adoption is permitted, including adoption in an interim period. The Company does not expect the adoption of ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15</div> to have a material impact on its financial statements.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #252525">We reviewed all other significant newly issued accounting pronouncements and determined they are either not applicable to our business or that no material effect is expected on our financial position and results of our operations.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;"> </div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;"></div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Valuation of Intangible Assets</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">We review identifiable intangible assets for impairment in accordance with ASC <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">350</div> — Intangibles —Goodwill and Other, whenever events or changes in circumstances indicate the carrying amount <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may</div> not be recoverable. Our intangible assets are currently solely the costs of obtaining trademarks and patents. Events or changes in circumstances that indicate the carrying amount <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may</div> not be recoverable include, but are not limited to, a significant change in the medical device marketplace and a significant adverse change in the business climate in which we operate. If such events or changes in circumstances are present, the undiscounted cash flows method is used to determine whether the intangible asset is impaired. Cash flows would include the estimated terminal value of the asset and exclude any interest charges. If the carrying value of the asset exceeds the undiscounted cash flows over the estimated remaining life of the asset, the asset is considered impaired, and the impairment is measured by reducing the carrying value of the asset to its fair value using the discounted cash flows method. The discount rate utilized is based on management’s best estimate of the related risks and return at the time the impairment assessment is made.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Accounting Policies and Estimates</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The presentation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Presentation of Taxes Collected from Customers</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Sales taxes are imposed on the Company’s sales to nonexempt customers. The Company collects the taxes from customers and remits the entire amounts to the governmental authorities. The Company’s accounting policy is to exclude the taxes collected and remitted from revenues and expenses.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Shipping and Handling</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Shipping and handling charges billed to customers are recorded as revenue. Shipping and handling costs are recorded within cost of goods sold on the statement of operations.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><div style="display: inline; font-weight: bold;">Advertising</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Advertising costs are expensed as incurred. Advertising expenses were <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$71,212</div> in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$8,220</div> in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015.</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><div style="display: inline; font-weight: bold;">Research and Development</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Research and development costs are charged to operations as incurred. Research and development costs were approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$406,000</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$261,000</div> for <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> respectively.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <!-- Field: /Page --> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Revenue Recognition</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;"> </div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company recognizes revenue in accordance with the SEC’s Staff Accounting Bulletin Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">13</div> Revenue Recognition and ASC <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">605</div>- Revenue Recognition.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 27.5pt"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed and determinable and collectability is probable. Delivery is considered to have occurred upon either shipment of the product or arrival at its destination based on the shipping terms of the transaction. The Company’s standard terms specify that shipment is FOB Skyline and the Company will, therefore, recognize revenue upon shipment in most cases. This revenue recognition policy applies to shipments of the STREAMWAY SYSTEM units as well as shipments of cleaning solution kits. When these conditions are satisfied, the Company recognizes gross product revenue, which is the price it charges generally to its customers for a particular product. Under the Company’s standard terms and conditions, there is no provision for installation or acceptance of the product to take place prior to the obligation of the customer. The customer’s right of return is limited only to the Company’s standard <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">one</div>-year warranty whereby the Company replaces or repairs, at its option, and it would be rare that the STREAMWAY SYSTEM unit or significant quantities of cleaning solution kits <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may</div> be returned. Additionally, since the Company buys both the STREAMWAY SYSTEM units and cleaning solution kits from “turnkey” suppliers, the Company would have the right to replacements from the suppliers if this situation should occur.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Cash Equivalents</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;"> </div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company considers all highly liquid debt instruments with a maturity of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div> months or less when purchased to be cash equivalents. Cash equivalents are stated at cost, which approximate fair value.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Certificates of Deposit</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;"> </div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Short-term interest bearing investments are those with maturities of less than <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">one</div> year but greater than <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div> months when purchased. Certificates with maturity dates beyond <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">one</div> year are classified as noncurrent assets. These investments are readily convertible to cash and are stated at cost plus accrued interest, which approximates fair value.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Investment Securities</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;"> </div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Readily marketable investments in debt and equity services are classified as available-for-sale and are reported at fair value with unrealized gains losses recorded in other comprehensive income. Unrealized gains are charged to earnings when an incline in fair value above the cost basis is determined to be other-than-temporary. Realized gains and losses on dispositions are based on the net proceeds and the adjusted book value of the securities sold, using the specific identification method.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Fair Value Measurements</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Under generally accepted accounting principles as outlined in the Financial Accounting Standards Board’s <div style="display: inline; font-style: italic;">Accounting Standards Certification</div> (ASC) <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">820,</div> fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The accounting standards ASC <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">820</div> establishes a <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div>-level fair value hierarchy that prioritizes information used in developing assumptions when pricing an asset or liability as follows:</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Level <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1</div> – Observable inputs such as quoted prices in active markets;</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Level <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2</div> – Inputs other than quoted prices in active markets, that are observable either directly or indirectly; and</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: 0in">Level <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3</div> – Unobservable inputs where there is little or no market data, which requires the reporting entity to develop its own assumptions.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company uses observable market data, when available, in making fair value measurements. Fair value measurements are classified according to the lowest level input that is significant to the valuation.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The fair value of the Company’s investment securities were determined based on Level <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1</div> inputs.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;"> </div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Receivables</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Receivables are reported at the amount the Company expects to collect on balances outstanding. The Company provides for probable uncollectible amounts through charges to earnings and credits to the valuation based on management’s assessment of the current status of individual accounts, changes to the valuation allowance have not been material to the financial statements.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Inventories</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Inventories are stated at the lower of cost or market, with cost determined on a <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">first</div>-in, <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">first</div>-out basis. Inventory balances are as follows:</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div> <table style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif;" cellspacing="0" cellpadding="0"> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td style="font-weight: bold"> </td> <td colspan="3" style="font-weight: bold; text-align: center" nowrap="nowrap">December 31,</td> <td style="font-weight: bold"> </td> <td colspan="3" style="font-weight: bold; text-align: center" nowrap="nowrap">December 31,</td> </tr> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid" nowrap="nowrap">2016</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid" nowrap="nowrap">2015</td> </tr> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td> </td> <td colspan="3" nowrap="nowrap"> </td> <td> </td> <td colspan="3" style="text-align: right" nowrap="nowrap"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 70%; text-align: left">Finished goods</td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">38,201</div></td> <td style="width: 1%; text-align: left"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">30,237</div></td> <td style="width: 1%; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Raw materials</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">165,812</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">162,623</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 1pt">Work-In-Process</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">68,195</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">38,880</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="padding-bottom: 2.25pt">Total</td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">272,208</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">231,740</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> </tr> </table> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;"> </div></div> <!-- Field: /Page --> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;"></div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Property and Equipment</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation of property and equipment is computed using the straight-line method over the estimated useful lives of the respective assets. Estimated useful asset life by classification is as follows:</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div> <table style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif;" cellspacing="0" cellpadding="0"> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td> </td> <td colspan="5" style="text-align: center" nowrap="nowrap">Years</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Computers and office equipment</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3 </div></td> <td style="text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">- </div></td> <td style="text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">7</div></div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="width: 82%; text-align: left">Leasehold improvements</td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 5%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td style="width: 5%; text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">5</div></td> <td style="width: 5%; text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td style="width: 1%; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Manufacturing Tooling</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3 </div></td> <td style="text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">- </div></td> <td style="text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">7</div></div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Demo Equipment</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td style="text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3</div></td> <td style="text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td style="text-align: left"> </td> </tr> </table> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company’s investment in Fixed Assets consists of the following:</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div> <table style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif;" cellspacing="0" cellpadding="0"> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid" nowrap="nowrap">December 31,<br /> 2016</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid" nowrap="nowrap">December 31,<br /> 2015</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 70%; text-align: left">Computers and office equipment</td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">164,318</div></td> <td style="width: 1%; text-align: left"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">153,553</div></td> <td style="width: 1%; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Leasehold Improvements</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">25,635</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">23,874</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Manufacturing Tooling</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">103,204</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">97,288</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1pt">Demo Equipment</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">23,236</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">8,962</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 10pt">Total</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">316,393</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">283,677</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1pt">Less: Accumulated Depreciation</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">214,897</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">144,079</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 2.25pt; padding-left: 10pt">Total Fixed Assets, Net</td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">101,496</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">139,598</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> </tr> </table> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Upon retirement or sale, the cost and related accumulated depreciation are removed from the balance sheet and the resulting gain or loss is reflected in operations. Maintenance and repairs are charged to operations as incurred.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Depreciation expense was <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$73,249</div> in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$72,275</div> in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015.</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Intangible Assets</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Intangible assets consist of trademarks and patent costs. Amortization expense was <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$9,107</div> in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$6,291</div> in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015.</div> The assets are reviewed for impairment annually, and impairment losses, if any, are charged to operations when identified.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Income Taxes</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company accounts for income taxes in accordance with ASC <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">740</div>- <div style="display: inline; font-style: italic;">Income Taxes (“ASC <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">740”)</div></div>. Under ASC <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">740,</div> deferred tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities and net operating loss and credit carryforwards using enacted tax rates in effect for the year in which the differences are expected to impact taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts expected to be realized.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company reviews income tax positions expected to be taken in income tax returns to determine if there are any income tax uncertainties. The Company recognizes tax benefits from uncertain tax positions only if it is more likely than not that the tax positions will be sustained on examination by taxing authorities, based on technical merits of the positions. The Company has identified no income tax uncertainties.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Tax years subsequent to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2013</div> remain open to examination by federal and state tax authorities.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Patents and Intellectual Property</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">25th,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2014,</div> the Company filed a non-provisional PCT Application No. <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">PCT/US2014/013081</div> claiming priority from the U.S. Provisional Patent Application, number <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">61756763</div> which was filed <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">one</div> year earlier on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">25th,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2013.</div> The Patent Cooperation Treaty (“PCT”) allows an applicant to file a single patent application to seek patent protection for an invention simultaneously in each of the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">148</div> countries of the PCT, including the United States. By filing this single “international” patent application through the PCT, it is easier and more cost effective than filing separate applications directly with each national or regional patent office in which patent protection is desired.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Our PCT patent application is for the new model of the surgical fluid waste management system. We obtained a favorable International Search Report from the PCT searching authority indicating that the claims in our PCT application are patentable (i.e., novel and non-obvious) over the cited prior art. A feature claimed in the PCT application is the ability to maintain continuous suction to the surgical field while measuring, recording and evacuating fluid to the facilities sewer drainage system. This provides for continuous operation of the STREAMWAY System unit in suctioning waste fluids, which means that suction is not interrupted during a surgical operation, for example, to empty a fluid collection container or otherwise dispose of the collected fluid.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company holds the following granted patents in the United States and a pending application in the United States on its earlier models: <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">US7469727,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">US8123731</div> and U.S. Publication No. <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">US20090216205</div> (collectively, the “Patents”). These Patents will begin to expire on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> August</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">8,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2023.</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <!-- Field: /Page --> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> July</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> Skyline Medical filed an international (PCT) patent application for its fluid waste collection system and received a favorable determination by the International Searching Authority finding that all of the claims satisfy the requirements for novelty, inventive step and industrial applicability. Skyline anticipates that the favorable International Search Report will result in allowance of its various national applications.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Credit Risk </div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Financial instruments which potentially subject the Company to concentrations of credit risk consist principally of cash. The Company places its cash with high credit quality financial institutions and, by policy, generally limits the amount of credit exposure to any <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">one</div> financial institution. The Company had a credit risk concentration as a result of depositing <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$1,652,438</div> of funds in excess of insurance limits in a single bank.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Product Warranty Costs</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;"> </div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> and in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> the Company incurred approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$34,665</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$56,201</div> in warranty costs.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Segments</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company operates in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">one</div> segment for the sale of its medical device and consumable products. Substantially all of the Company’s assets, revenues, and expenses for <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015</div> were located at or derived from operations in the United States. There were no revenues from sales outside of the United States.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Risks and Uncertainties</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company is subject to risks common to companies in the medical device industry, including, but not limited to, development by the Company or its competitors of new technological innovations, dependence on key personnel, protection of proprietary technology, and compliance with regulations of the FDA and other governmental agencies.</div></div>
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Product Warranty Costs</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;"> </div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> and in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> the Company incurred approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$34,665</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$56,201</div> in warranty costs.</div></div></div>
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<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">NOTE <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3</div> – STOCKHOLDERS’ EQUITY (DEFICIT), STOCK OPTIONS AND WARRANTS</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015</div> Public Offering of Units</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> August</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015</div> (the “Issuance Date”), the Company completed a public offering (the “Offering”) of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,666,667</div> Units (the “Units”) as described below. The public offering price in the Offering was <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$9.00</div> per Unit, and the purchase price for the underwriter of the Offering (the “Underwriter”) was <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$8.28</div> per Unit, resulting in an underwriting discount and commission of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$0.72</div> (or <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">8.00%)</div> per Unit and total net proceeds to the Company before expenses of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$13.8</div> million. The Company had granted the Underwriter an option for a period of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">45</div> days to purchase up to an additional <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">250,000</div> Units solely to cover over-allotments. The Underwriter chose not to purchase any additional Units under the over-allotment option. The Company paid to the Underwriter a non-accountable expense allowance equal to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1%</div> of the gross proceeds of the Offering and agreed to reimburse expenses incurred by the Underwriter up to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$70,000.</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> August</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> as a result of the communication of the Offering and the issuance of the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">228,343</div> Exchange Units in the Unit Exchange described below, the Company issued a total of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,895,010</div> Units, comprised of a total of aggregate of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">75,801</div> shares of Common Stock, <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,895,010</div> shares of Series B Preferred Stock and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">7,580,040</div> Series A Warrants.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.75pt">Each Unit consisted of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">one</div> share of common stock, par value <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$0.01</div> per share (the “Common Stock”), <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">one</div> share of Series B Convertible Preferred Stock (“Series B Preferred Stock”) and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">four</div> Series A Warrants. The shares of Common Stock, the shares of Series B Preferred Stock and the Series A Warrants that comprise the Units automatically separated on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> February</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">29,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016.</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.75pt"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">For a description of the terms of the Series B Convertible Preferred Stock included within the Units, see “Certificate of Designation for Series B Preferred Stock” below. For a description of the terms of the Series A Warrants included within the Units, see “Series A Warrants” below.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-style: italic;">Series A Warrants</div>. The Series A Warrants separated from the Series B Convertible Preferred Stock and the Common Stock included within the Units as described above and are currently exercisable. The Series A Warrants will terminate on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> August</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2020.</div> Each Series A Warrant is exercisable into <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">one</div> share of Common Stock at an initial cash exercise price of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$123.75</div> per share. The exercise price and number of shares of common stock issuable upon exercise is subject to appropriate adjustment in the event of stock dividends, stock splits, reorganizations or similar events affecting the Common Stock and the exercise price.</div> <!-- Field: Page; Sequence: 61; Value: 1 --> <!-- Field: /Page --> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.75pt">Holders <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may</div> exercise Series A Warrants by paying the exercise price in cash or, in lieu of payment of the exercise price in cash, by electing to receive a number of shares of Common Stock equal to the Black Scholes Value (as defined below) based upon the number of shares the holder elects to exercise. The number of shares of Common Stock to be delivered will be determined according to the following formula, referred to as the “Cashless Exercise.”</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.75pt"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.75pt">Total Shares = (A x B) / C</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.75pt"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.75pt">Where:</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.75pt"> </div> <table style="font: 10pt Times New Roman, Times, Serif;" cellspacing="0" cellpadding="0"> <tr style="vertical-align: top"> <td style="width: 25px"> </td> <td style="width: 24px"><div style="display: inline; font-family: Symbol; font-size: 10pt">·</div></td> <td><div style="display: inline; font-size: 10pt">Total Shares is the number of shares of Common Stock to be issued upon a Cashless Exercise.</div></td> </tr> <tr style="vertical-align: top"> <td> </td> <td> </td> <td> </td> </tr> <tr style="vertical-align: top"> <td> </td> <td><div style="display: inline; font-family: Symbol; font-size: 10pt">·</div></td> <td><div style="display: inline; font-size: 10pt">A is the total number of shares with respect to which the Series A Warrant is then being exercised.</div></td> </tr> </table> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <table style="font: 10pt Times New Roman, Times, Serif;" cellspacing="0" cellpadding="0"> <tr style="vertical-align: top"> <td style="width: 25px"> </td> <td style="width: 24px"><div style="display: inline; font-family: Symbol; font-size: 10pt">·</div></td> <td><div style="display: inline; font-size: 10pt">B is the Black Scholes Value (as defined below).</div></td> </tr> </table> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <table style="font: 10pt Times New Roman, Times, Serif;" cellspacing="0" cellpadding="0"> <tr style="vertical-align: top"> <td style="width: 25px"> </td> <td style="width: 24px"><div style="display: inline; font-family: Symbol; font-size: 10pt">·</div></td> <td><div style="display: inline; font-size: 10pt">C is the closing bid price of the Common Stock as of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">two</div> trading days prior to the time of such exercise, provided that in no event <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may</div> “C” be less than <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$0.43</div> per share (subject to appropriate adjustment in the event of stock dividends, stock splits or similar events affecting the Common Stock).</div></td> </tr> </table> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.75pt"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.75pt">The Black Scholes Value (as defined above) as of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> September</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">30,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> was <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$4.319,</div> and the closing bid price of Common Stock as of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> September</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">30,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> was <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$4.125.</div> Therefore, an exercise on that date would have resulted in the issuance of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">.40</div> shares of Common Stock for each Series A Warrant. Approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">6,141,115</div> Series A Warrants have been exercised in cashless exercises as of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> September</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">30,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> resulting in the issuance of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2,318,663</div> shares of Common Stock. If all of the remaining <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">35,084</div> Series A Warrants that were issued as part of the Units sold in the Offering and part of the Units issued on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> August</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015</div> were exercised pursuant to a cashless exercise and the closing bid price of our common stock as of the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">two</div> trading days prior to the time of such exercise was <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$0.43</div> per share or less and the Black Scholes Value were <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$4.319</div> (the Black Scholes Value as of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> September</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">30,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016),</div> then a total of approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">564</div> shares of our common stock would be issued to the holders of such Series A Warrants.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.75pt"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.75pt">The Series A Warrants will not be exercisable or exchangeable by the holder of such warrants to the extent (and only to the extent) that the holder or any of its affiliates would beneficially own in excess of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4.99%</div> of the common stock of the Company, determined in accordance with Section <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">13(d)</div> of the Securities Exchange Act of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1934,</div> as amended, and the regulations promulgated thereunder.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.75pt"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.75pt">In addition to (but not duplicative of) the adjustments to the exercise price and the number of shares of Common Stock issuable upon exercise of the Series A Warrants in the event of stock dividends, stock splits, reorganizations or similar events, the Series A Warrants provide for certain adjustments if the Company, at any time prior to the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div> year anniversary of the Issuance Date, <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(1)</div> declares or makes any dividend or other distribution of its assets (or rights to acquire its assets) to all or substantially all of the holders of shares of Common Stock at any time after the Issuance Date, or <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(2)</div> grants, issues or sells any options, convertible securities or rights to purchase stock, warrants, securities or other property pro rata to all or substantially all of the record holders of any class of shares of Common Stock. Further, if at any time a Series A Warrant is outstanding, the Company consummates any fundamental transaction, as described in the Series A Warrants and generally including any consolidation or merger into another corporation, or the sale of all or substantially all of our assets, or other transaction in which the Common Stock is converted into or exchanged for other securities or other consideration, the holder of any Series A Warrants will thereafter receive, the securities or other consideration to which a holder or the number of shares of Common Stock then deliverable upon the exercise or exchange of such Series A Warrants would have been entitled upon such consolidation or merger or other transaction.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.75pt"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.75pt"><div style="display: inline; font-style: italic;">Unit Purchase Option.</div> The Company, in connection with the Offering, entered into a Unit Purchase Option Agreement, dated as of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> August</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015</div> (the “Unit Purchase Option”), pursuant to which the Company granted the Underwriter the right to purchase from the Company up to a number of Units equal to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">5%</div> of the Units sold in the Offering (or up to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">83,333</div> Units) at an exercise price equal to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">125%</div> of the public offering price of the Units in the Offering, or <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$11.25</div> per Unit. The Unit Purchase Option was terminated in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> May</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> in exchange for <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">135,995</div> shares of common stock.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.75pt"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.75pt"><div style="display: inline; font-style: italic;">Series B Preferred Stock.</div> Each share of Series B Preferred Stock is convertible into <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">one</div> share of Common Stock (subject to appropriate adjustment in the event of stock dividends, stock splits, reorganizations or similar events) on the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">six</div>-month anniversary of the Issuance Date or on the date of an Early Separation. In addition, the Series B Preferred Stock will automatically convert into shares of common stock upon the occurrence of a fundamental transaction, as described in the certificate of designations for the Series B Preferred Stock but including mergers, sales of the company’s assets, changes in control and similar transactions. The Series B Preferred Stock is not convertible by the holder of such preferred stock to the extent (and only to the extent that the holder or any of its affiliates would beneficially own in excess of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4.99%</div> of the common stock of the Company. The Series B Preferred Stock has no voting rights, except for the right to approve certain amendments to the certificate of designations or similar actions. With respect to payment of dividends and distribution of assets upon liquidation or dissolution or winding up of the Company, the Series B Preferred Stock shall rank equal to the common stock of the Company. No sinking fund has been established for the retirement or redemption of the Series B Preferred Stock.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.75pt"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.75pt"><div style="display: inline; font-style: italic;">Unit Exchange.</div> On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> February</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2014,</div> the Company raised <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$2,055,000</div> in gross proceeds from a private placement of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">20,550</div> shares of Series A Convertible Preferred Stock, par value <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$0.01,</div> with a stated value of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$100</div> per share (the “Series A Preferred Shares”) and warrants to purchase shares of the Company’s common stock. The Series A Preferred Shares and warrants were sold to investors pursuant to a Securities Purchase Agreement, dated as of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> February</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2014.</div> On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> August</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> the Company issued a total of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">228,343</div> Units (the “Exchange Units”) in exchange for the outstanding Series A Preferred Stock which were then cancelled pursuant to an agreement with the holders of the Series A Preferred Shares. The warrants that were issued in connection with the issuance of the Series A Preferred Shares remained outstanding; however, the warrant amounts were reduced so that the warrants are exercisable into an aggregate of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3,391</div> shares of the Company’s common stock. The Exchange Units were exempt from registration under Section <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3(a)(9)</div> of the Securities Act. On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> August</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> the Company filed a termination certificate with the Delaware Secretary of State. Following that date there were no shares of Series A Preferred Stock outstanding, and the previously authorized shares of Series A Preferred Stock resumed the status of authorized but unissued and undesignated shares of preferred stock of the Company.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.75pt"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.75pt"><div style="display: inline; font-style: italic;">Redemption of Convertible Notes. </div>In connection with the closing of the Offering, <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$933,074</div> aggregate principal amount of Convertible Notes plus interest and a <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">40%</div> redeemable premium were redeemed for total payments of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$1,548,792.</div> See Note <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4.</div> Of this amount, approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$167,031</div> was paid to its affiliates in redemption of their Convertible Notes.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.75pt"> </div> <!-- Field: /Page --> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.75pt"></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-style: italic;">Registered Exchange Offer for Warrants.</div> On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">25,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> the Company commenced a registered exchange offer (the “Exchange Offer”) to exchange Series B Warrants (the “Series B Warrants”) to purchase shares of our common stock, par value <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$0.01</div> per share (the “Warrant Shares”), for up to an aggregate of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3,157,186</div> outstanding Series A Warrants (the “Series A Warrants”). On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> each Series A Warrant could be exercised on a cashless basis for <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10.05</div> shares of common stock. Each Series B Warrant <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may</div> be exercised on a cashless basis for <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">one</div> share of common stock. For each outstanding Series A Warrant <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">tendered</div> by holders, we offered to issue <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10.2</div> Series B Warrants, which are subject to cashless exercise at a fixed rate of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">one</div> share of common stock per Series B Warrant (subject to further adjustment for stock splits, etc.). The Exchange Offer expired at midnight, Eastern time, on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> April</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">21,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016.</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,770,556</div> Series A Warrants were <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">tendered</div> by holders. The Company delivered an aggregate of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">18,059,671</div> Series B Warrants pursuant to the terms of the Exchange Offer. In addition, between <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> July</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">6,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,251,510</div> Series A Warrants were exercised in cashless exercises, resulting in the issuance of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">20,122</div> shares of common stock.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-style: italic;"> </div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-style: italic;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> Registered Direct Offering</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> November</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">29,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> the Company closed a registered direct offering for gross proceeds of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$1,983,337.</div> The offering consisted of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">756,999</div> shares of common stock priced at <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$2.62</div> per share and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">five</div>-year warrants for <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">756,999</div> shares of common stock that become exercisable in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">six</div> months, with a strike price of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$4.46</div> per share. The net proceeds from the sale of the securities, after deducting placement agent fees and related offering expenses, was <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$1,739,770.</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Equity Incentive Plan</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company has an equity incentive plan, which allows issuance of incentive and non-qualified stock options to employees, directors and consultants of the Company, where permitted under the plan. The exercise price for each stock option is determined by the Board of Directors. Vesting requirements are determined by the Board of Directors when granted and currently range from immediate to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div> years. Options under this plan have terms ranging from <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div> to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">ten</div> years.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-style: italic;">Accounting for share-based payment</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company has adopted ASC <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">718</div>- <div style="display: inline; font-style: italic;">Compensation-Stock Compensation </div>("ASC <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">718").</div> Under ASC <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">718</div> stock-based employee compensation cost is recognized using the fair value based method for all new awards granted after <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2006</div> and unvested awards outstanding at <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2006.</div> Compensation costs for unvested stock options and non-vested awards that were outstanding at <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2006,</div> are being recognized over the requisite service period based on the grant-date fair value of those options and awards, using a straight-line method. We elected the modified-prospective method under which prior periods are not retroactively restated.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">ASC <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">718</div> requires companies to estimate the fair value of stock-based payment awards on the date of grant using an option-pricing model or other acceptable means. The Company uses the Black-Scholes option valuation model which requires the input of significant assumptions including an estimate of the average period of time employees will retain vested stock options before exercising them, the estimated volatility of the Company's common stock price over the expected term, the number of options that will ultimately be forfeited before completing vesting requirements, the expected dividend rate and the risk-free interest rate. Changes in the assumptions can materially affect the estimate of fair value of stock-based compensation and, consequently, the related expense recognized. The assumptions the Company uses in calculating the fair value of stock-based payment awards represent the Company's best estimates, which involve inherent uncertainties and the application of management's judgment. As a result, if factors change and the Company uses different assumptions, the Company's equity-based compensation expense could be materially different in the future.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Since the Company's common stock has no significant public trading history, and the Company has experienced no significant option exercises in its history, the Company is required to take an alternative approach to estimating future volatility and estimated life and the future results could vary significantly from the Company's estimates. The Company compiled historical volatilities over a period of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2</div> to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">7</div> years of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15</div> small-cap medical companies traded on major exchanges and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10</div> mid-range medical companies on the OTC Bulletin Board and combined the results using a weighted average approach. In the case of ordinary options to employees the Company determined the expected life to be the midpoint between the vesting term and the legal term. In the case of options or warrants granted to non-employees, the Company estimated the life to be the legal term unless there was a compelling reason to make it shorter.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">When an option or warrant is granted in place of cash compensation for services, the Company deems the value of the service rendered to be the value of the option or warrant. In most cases, however, an option or warrant is granted in addition to other forms of compensation and its separate value is difficult to determine without utilizing an option pricing model. For that reason the Company also uses the Black-Scholes option-pricing model to value options and warrants granted to non-employees, which requires the input of significant assumptions including an estimate of the average period the investors or consultants will retain vested stock options and warrants before exercising them, the estimated volatility of the Company's common stock price over the expected term, the number of options and warrants that will ultimately be forfeited before completing vesting requirements, the expected dividend rate and the risk-free interest rate. Changes in the assumptions can materially affect the estimate of fair value of stock-based consulting and/or compensation and, consequently, the related expense recognized.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Since the Company has limited trading history in its stock and no <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">first</div>-hand experience with how its investors and consultants have acted in similar circumstances, the assumptions the Company uses in calculating the fair value of stock-based payment awards represent its best estimates, which involve inherent uncertainties and the application of management's judgment. As a result, if factors change and the Company uses different assumptions, the Company's equity-based consulting and interest expense could be materially different in the future.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-style: italic;">Valuation and accounting for options and warrants</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company determines the grant date fair value of options and warrants using a Black-Scholes option valuation model based upon assumptions regarding risk-free interest rate, expected dividend rate, volatility and estimated term.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <!-- Field: /Page --> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> the Company issued a dividend adjustment to the Purchasers of the Preferred Shares as described above. Certain previous dividends paid were calculated with an exercise price of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$487.50</div> per share, but should have been calculated at <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$243.75</div> per share. As a result, <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">125</div> shares of common stock were issued to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">16</div> holders of Preferred Shares.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> the Company issued dividends to the Purchasers of the Preferred Shares as described above. The dividends are at an annual rate of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">6%</div> of the stated value of the Preferred Shares paid on a quarterly basis in the form of common stock per a stipulated <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$243.75</div> per share. As a result, <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">125</div> shares of common stock were issued to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">16</div> holders of Preferred Shares.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> June</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">30,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015,</div> the Company issued dividends to Purchases of the Preferred Shares as described above. The dividends are at an annual rate of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">6%</div> of the stated value of the Preferred Shares paid on a quarterly basis in the form of common stock per a stipulated <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$243.75</div> per share. As a result, <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">125</div> shares of common stock were issued to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">16</div> holders of Preferred Shares.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">For grants of stock options and warrants in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015</div> the Company used a <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1.63%</div> to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2.35%</div> risk-free interest rate, <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">0%</div> dividend rate, <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">59%</div> to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">66%</div> volatility and estimated terms of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">5</div> to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10</div> years. Value computed using these assumptions ranged from <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$6.875</div> to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$139.2375</div> per share.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">25,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> the Company commenced the Exchange Offer which was completed on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> April</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">20,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> as described above.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> July</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> the Company issued inducement stock options in accordance with NASDAQ listing rule for <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">40,000</div> shares of common stock, par value <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$0.01</div> at <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$3.75</div> per share to the Company’s newly hired Vice President of Sales. The options will vest in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">six</div> equal increments: on the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">first,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">second,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">third,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">fourth,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">fifth</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">sixth</div> quarters of the hiring date anniversary.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> October</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> the Company issued <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">400,000</div> shares of common stock, par value <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$0.01,</div> to be held in escrow in connection with the Company’s Partnership and Exclusive Reseller Agreement with GLG Pharma, LLC.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">For grants of stock options and warrants in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> the Company used a <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1.46%</div> to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2.45%</div> risk free interest rate, <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">0%</div> dividend rate, <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">59%</div> to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">66%</div> volatility and estimated terms of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">5</div> to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10</div> years. Value computed using these assumptions ranged from <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$1.6329</div> to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$3.7195</div> per share.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The following summarizes transactions for stock options and warrants for the periods indicated: </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div> <table style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif;" cellspacing="0" cellpadding="0"> <tr style="vertical-align: bottom"> <td nowrap="nowrap"> </td> <td style="font-weight: bold"> </td> <td colspan="7" style="font-weight: bold; text-align: center" nowrap="nowrap">Stock Options</td> <td style="font-weight: bold"> </td> <td colspan="7" style="font-weight: bold; text-align: center" nowrap="nowrap">Warrants</td> </tr> <tr style="vertical-align: bottom"> <td style="text-align: center" nowrap="nowrap"> </td> <td style="font-weight: bold"> </td> <td colspan="3" style="font-weight: bold; text-align: center" nowrap="nowrap">Number of<br /> Shares</td> <td style="font-weight: bold"> </td> <td colspan="3" style="font-weight: bold; text-align: center" nowrap="nowrap">Average <br /> Exercise <br /> Price</td> <td style="font-weight: bold"> </td> <td colspan="3" style="font-weight: bold; text-align: center" nowrap="nowrap">Number of<br /> Shares</td> <td style="font-weight: bold"> </td> <td colspan="3" style="font-weight: bold; text-align: center" nowrap="nowrap">Average <br /> Exercise <br /> Price</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 48%">Outstanding at December 31, 2014</td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 10%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">17,945</div></td> <td style="width: 1%; text-align: left"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 10%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">187.75</div></td> <td style="width: 1%; text-align: left"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 10%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">20,029</div></td> <td style="width: 1%; text-align: left"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 10%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">198.75</div></td> <td style="width: 1%; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td>Issued</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">14,171</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">69.00</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">303,269</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">123.75</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td>Expired</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(766</div></td> <td style="text-align: left">)</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">293.25</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(79</div></td> <td style="text-align: left">)</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">283.50</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 1pt">Exercised</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">-</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">-</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(120</div></td> <td style="border-bottom: Black 1pt solid; text-align: left">)</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">123.75</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td>Outstanding at December 31, 2015</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,350</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left">$</td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">133.23</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">323,099</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left">$</td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">128.40</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td>Issued</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">157,982</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3.14</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,487,881</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">0.71</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td>Cancelled</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(22,377</div></td> <td style="text-align: left">)</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">122.13</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">-</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">-</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 1pt">Exercised</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(1,312</div></td> <td style="border-bottom: Black 1pt solid; text-align: left">)</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">65.75</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(939,879</div></td> <td style="border-bottom: Black 1pt solid; text-align: left">)</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">-</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 2.25pt">Outstanding at December 31, 2016</td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">165,643</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">11.22</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">871,101</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.25pt double; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">52.22</div></td> <td style="border-bottom: Black 2.25pt double; text-align: left"> </td> </tr> </table> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">At <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">71,209</div> stock options are fully vested and currently exercisable with a weighted average exercise price of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$21.62</div> and a weighted average remaining term of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">9.33</div> years. There are <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">114,102</div> warrants that are fully vested and exercisable. Stock-based compensation recognized in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2015</div> was <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$165,271</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$871,877,</div> respectively. The Company has <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$223,205</div> of unrecognized compensation expense related to non-vested stock options that are expected to be recognized over the next <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">12</div> months.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <!-- Field: /Page --> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The following summarizes the status of options and warrants outstanding at <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016:</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div> <table style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse;" cellspacing="0" cellpadding="0"> <tr style="vertical-align: bottom"> <td colspan="3" style="border-bottom: black 1pt solid; text-align: center"><div style="display: inline; font-size: 10pt"><div style="display: inline; font-weight: bold;">Range of Exercise Prices</div></div></td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><div style="display: inline; font-size: 10pt"><div style="display: inline; font-weight: bold;">Shares</div></div></td> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><div style="display: inline; font-size: 10pt"><div style="display: inline; font-weight: bold;">Weighted </div></div><br /> <div style="display: inline; font-size: 10pt"><div style="display: inline; font-weight: bold;">Average </div></div><br /> <div style="display: inline; font-size: 10pt"><div style="display: inline; font-weight: bold;">Remaining </div></div><br /> <div style="display: inline; font-size: 10pt"><div style="display: inline; font-weight: bold;">Life</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td colspan="2"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">Options:</div></div></td> <td> </td> <td> </td> <td colspan="2"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td> </td> <td> </td> <td colspan="2"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 1%"><div style="display: inline; font-size: 10pt">$</div></td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2.25</div></div></td> <td style="width: 57%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">293</div></div></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">9.65</div></div></td> <td style="width: 1%"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2.42</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">37,152</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">9.64</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2.80</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">57,145</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">10.00</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">3.75</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">44,000</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">9.50</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">4.125</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">3,636</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">9.75</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">4.1975</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">7,147</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">9.72</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">4.25</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">3,529</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">9.25</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">5.125</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">3,902</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">9.69</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">65.75</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">342</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">8.81</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">73.50</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">1,157</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">9.01</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">77.50</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2,323</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">8.50</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">80.25</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">187</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">8.75</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">86.25</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">232</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">8.25</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">121.875</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">5</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">6.20</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">131.25</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">81</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">5.69</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">148.125</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">928</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">6.21</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">150.00</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">1,760</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">5.63</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">162.50</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">123</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">8.01</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">206.25</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">121</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">7.75</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">248.4375</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">121</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">6.54</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">262.50</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">130</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">6.54</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">281.25</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">529</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">6.04</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">318.75</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">3</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">6.35</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">346.875</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">72</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">7.25</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">431.25</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">306</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">7.19</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">468.75</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">133</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">7.15</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">506.25</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">188</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">7.00</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">543.75</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">53</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">6.77</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">596.25</div></div></td> <td> </td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">45</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">6.75</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td colspan="2"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">Total</div></div></td> <td> </td> <td> </td> <td style="border-bottom: black 2.25pt double"> </td> <td style="border-bottom: black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">165,643</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td colspan="2"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">Warrants:</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">4.46</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">756,999</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">4.92</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">93.75</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2,255</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">1.19</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">123.75</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">94,085</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">3.67</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">150.00</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">4,114</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">1.20</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">225.00</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">107</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">1.07</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">243.75</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2,529</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2.59</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">281.25</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">5,897</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">0.95</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">309.375</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2,850</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2.61</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">309.50</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">222</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2.85</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">337.50</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">178</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">1.46</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">371.25</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">944</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">1.41</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">506.25</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">59</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2.12</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td><div style="display: inline; font-size: 10pt">$</div></td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">609.375</div></div></td> <td> </td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">862</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2.09</div></div></td> <td> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td colspan="2"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">Total</div></div></td> <td> </td> <td> </td> <td style="border-bottom: black 2.25pt double"> </td> <td style="border-bottom: black 2.25pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">871,101</div></div></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td> </td> </tr> </table> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Stock options and warrants expire on various dates from <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> June</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2017</div> to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2026.</div> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <!-- Field: /Page --> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">At a special meeting of stockholders held on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> September</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> the Company’s stockholders (i) approved an amendment to the Company’s certificate of incorporation to increase the number of authorized shares of common stock from <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">100,000,000</div> to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">200,000,000</div> and (ii) approved an amendment to the Company’s certificate of incorporation to affect a reverse stock split of the outstanding shares of its common stock within certain limits. On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> September</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">16,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> the Company filed a Certificate of Amendment to its Certificate of Incorporation to affect the increase in the authorized capital stock. On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> October</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">26,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> the Company filed a Certificate of Amendment to its Certificate of Incorporation to affect a reverse stock split of the outstanding shares of its common stock at a ratio of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">one</div>-for-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">twenty</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">five</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(1:25),</div> and a proportionate decrease of the authorized common stock from <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">200,000,000</div> shares to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">8,000,000</div> shares. The reverse stock split took effect at <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">5:00</div> p.m. New York time on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> October</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">27,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016,</div> and the Company’s common stock commenced trading on a post-split basis on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> October</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">28,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016.</div> The Company’s board of directors has determined that the Company <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may</div> require additional authorized shares for anticipated equity financings, future equity offerings, strategic acquisition opportunities, and the continued issuance of equity awards under our stock incentive plan to recruit and retain key employees, and for other proper corporate purposes. As a result, the board of directors called another special meeting of the stockholders that took place on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">29,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2017.</div> The vote, a proposal to increase the number of authorized shares of common stock from <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">8,000,000</div> shares to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">24,000,000</div> shares of common stock under the Company’s certificate of incorporation passed.</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;"> </div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Stock Options and Warrants Granted by the Company</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The following table is the listing of stock options and warrants as of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div> by year of grant:</div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0.5in"> </div> <div> <table style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif;" cellspacing="0" cellpadding="0"> <tr style="vertical-align: bottom"> <td style="text-align: left" nowrap="nowrap">Stock Options:</td> <td> </td> <td colspan="3" nowrap="nowrap"> </td> <td> </td> <td colspan="5" nowrap="nowrap"> </td> </tr> <tr style="vertical-align: bottom"> <td style="text-align: left" nowrap="nowrap">Year</td> <td style="padding-bottom: 1pt"> </td> <td colspan="3" style="text-align: center; border-bottom: Black 1pt solid" nowrap="nowrap">Shares</td> <td style="padding-bottom: 1pt"> </td> <td colspan="5" style="text-align: center; border-bottom: Black 1pt solid" nowrap="nowrap">Price</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 67%; text-align: left">2011</td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">175</div></td> <td style="width: 1%; text-align: left"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 5%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td style="width: 5%; text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">281.25</div></td> <td style="width: 5%; text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td style="width: 1%; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">2012</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,841</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">131.25 </div></div></td> <td style="text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">150.00</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">2013</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,612</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">121.88</div></div> </td> <td style="text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">596.25</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">2014</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">969</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">162.50 </div></div></td> <td style="text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">468.75</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">2015</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4,240</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">65.75 </div></div></td> <td style="text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">86.25</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1pt">2016</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">156,806</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="text-align: right; border-bottom: Black 1pt solid"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">2.25 </div></div></td> <td style="text-align: center; border-bottom: Black 1pt solid"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">5.13</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 2.25pt; text-align: left">Total</td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="border-bottom: Black 2.5pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">165,643</div></td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="text-align: right; border-bottom: Black 2.5pt double"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$</div><div style="display: inline; font-size: 10pt">2.25 </div></td> <td style="text-align: center; border-bottom: Black 2.5pt double"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="border-bottom: Black 2.5pt double; text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">596.25</div></td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td> </tr> </table> </div> <div style=" margin: 0"> </div> <div> <table style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif;" cellspacing="0" cellpadding="0"> <tr style="vertical-align: bottom"> <td style="text-align: left" nowrap="nowrap">Warrants:</td> <td> </td> <td colspan="3" style="text-align: center" nowrap="nowrap"> </td> <td> </td> <td colspan="5" style="text-align: center" nowrap="nowrap"> </td> </tr> <tr style="vertical-align: bottom"> <td style="text-align: left" nowrap="nowrap">Year</td> <td style="padding-bottom: 1pt"> </td> <td colspan="3" style="text-align: center; border-bottom: Black 1pt solid" nowrap="nowrap">Shares</td> <td style="padding-bottom: 1pt"> </td> <td colspan="5" style="text-align: center; border-bottom: Black 1pt solid" nowrap="nowrap">Price</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 67%; text-align: left">2012</td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 12%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2,792</div></td> <td style="width: 1%; text-align: left"> </td> <td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 5%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td style="width: 5%; text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">281.25</div></td> <td style="width: 5%; text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td style="width: 1%; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">2013</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10,703</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">93.75 </div></div></td> <td style="text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">371.25</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">2014</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">6,455</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">243.75 </div></div></td> <td style="text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">609.38</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">2015</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">94,152</div></td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-size: 10pt">0.00 </div></div></td> <td style="text-align: center"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">243.75</div></td> <td style="text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 1pt">2016</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">756,999</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="text-align: right; border-bottom: Black 1pt solid"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td style="text-align: center; border-bottom: Black 1pt solid"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4.46</div></td> <td style="border-bottom: Black 1pt solid; text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="padding-bottom: 2.25pt; text-align: left">Total</td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="border-bottom: Black 2.5pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">871,101</div></td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="padding-bottom: 2.25pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="text-align: right; border-bottom: Black 2.5pt double"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$</div><div style="display: inline; font-size: 10pt">0.00 </div></td> <td style="text-align: center; border-bottom: Black 2.5pt double"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="border-bottom: Black 2.5pt double; text-align: left"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">609.38</div></td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td> </tr> </table> </div></div>
25
23950996
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">NOTE <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">11</div> – SUBSEQUENT EVENTS</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">13,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2017,</div> the Company announced the pricing of a firm commitment underwritten public offering of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,750,000</div> Units at an offering price of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$2.25</div> per Unit, with each Unit consisting of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">one</div> share of the Company’s Common Stock and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">0.2</div> of a Series D Warrant, with each whole Series D Warrant purchasing <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">one</div> share of our common stock at an exercise price of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$2.25</div> per whole share. The shares of Common Stock and the Series D Warrants are immediately separable and will be issued separately. Gross proceeds to the Company from the offering was approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$3,937,500</div> before deducting underwriting discounts and commissions and other estimated offering expenses payable by the Company. The Company has granted the underwriter a <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">45</div>-day option to purchase an additional (i) up to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">175,000</div> additional shares of common stock at the public offering price per unit less the price per warrant included in the unit and less the underwriting discount and/or (ii) additional warrants to purchase up to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">35,000</div> additional shares of common stock at a purchase price of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$0.01</div> per warrant to cover over-allotments, if any. The offering closed on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">19,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2017.</div> The underwriter exercised this option, and on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> February</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">22,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2017,</div> the Company received gross proceeds of approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$358,312.</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">31,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2017,</div> the Company filed an <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">8</div>-K announcing that the Company completed an underwritten public offering for gross proceeds of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$3,937,500</div> on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">19,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2017.</div> As a result of this public offering, the Company believes that its shareholders’ equity now exceeds <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$2.5</div> million as of the date of this filing. On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> February</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2017,</div> the Company received confirmation from Nasdaq that it now exceeds all applicable requirements for continued listing and is in compliance.</div></div>
<div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;">Accounting Policies and Estimates</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The presentation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.</div></div></div>
2823345
155233
2823345
155233
The number of shares underlying options and warrants outstanding as of December 31, 2016 and December 31, 2015 are 1,036,744 and 354,449, respectively. The number of shares underlying the preferred stock as of December 31, 2016 is 79,246. The effect of the shares that would be issued upon exercise of such options, warrants and preferred stock has been excluded from the calculation of diluted loss per share because those shares are anti-dilutive.
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