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us-gaap:ChiefExecutiveOfficerMember 2014-02-04 0001446159 skln:SOKNoteMember skln:SOKPartnersLLCMember 2014-07-23 0001446159 skln:SOKNoteMember skln:SOKPartnersLLCMember 2014-07-23 2014-07-23 0001446159 skln:SOKNoteMember skln:SOKPartnersLLCMember 2014-09-09 0001446159 skln:DarylCDemarayBradyPFarrellChristopherSHowellAndRonaldWWaltersVSkylineMedicalIncMember 2015-04-29 2015-04-29 0001446159 skln:DarylCDemarayBradyPFarrellChristopherSHowellAndRonaldWWaltersVSkylineMedicalIncMember 2015-04-29 2015-09-30 iso4217:USD iso4217:USD xbrli:shares xbrli:shares xbrli:pure The number of shares underlying options and warrants outstanding as of September 30, 2015 and September 30, 2014 are 8,588,832 and 945,220 respectively. The number of underlying Series B preferred shares outstanding is 1,895,010. 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(the "Company") was incorporated under the laws of the State of Minnesota in 2002. Effective August 6, 2013, the Company changed its name to Skyline Medical Inc. As of September 30, 2015, the registrant had 5,203,428 shares of common stock, par value $.01 per share, outstanding. Pursuant to an Agreement and Plan of Merger dated effective December 16, 2013, 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 April 2009, the Company received 510(k) clearance from the FDA to authorize the Company to market and sell its STREAMWAY FMS products.</p><br/><p style="font-size: 10pt; margin: 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&#x2019; deficit until August 31, 2015 whereupon the Company closed its public offering of units of common stock, Series B Convertible Preferred Stock and Series A Warrants (the &#x201c;Units&#x201d;). 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.</p><br/><p style="font-size: 10pt; margin: 0">Since inception to September 30, 2015, the Company raised approximately $22,723,061 in equity, inclusive of $2,055,000 from a private placement of Series A Convertible Preferred Stock, $13,555,003 from the public offering of Units and $5,685,000 in debt financing. See &#x201c;Management&#x2019;s Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources.&#x201d;</p><br/><p style="font-size: 10pt; margin: 0"><b>Recent Accounting Developments</b></p><br/><p style="font-size: 10pt; margin: 0">In May 2014, the Financial Accounting Standards Board (&#x201c;FASB&#x201d;) issued ASU 2014-09, <i>Revenue from Contracts with Customers </i>and created a new topic in the FASB Accounting Standards Codification ("ASC"), Topic 606. The new standard provides 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 December 15, 2017, including interim periods within that reporting period. Early application is not permitted. We are currently evaluating the impact this guidance may have on our financial statements and related disclosures.</p><br/><p style="font-size: 10pt; margin: 0">In June 2014, the FASB issued ASU 2014-12, <i>"Compensation - Stock Compensation" </i>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 December 15, 2015. Early adoption is permitted. We are currently evaluating the impact this guidance may have on our financial statements.</p><br/><p style="font-size: 10pt; margin: 0">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.</p><br/><p style="font-size: 10pt; margin: 0pt 0; color: #252525">In April 2015, the FASB issued ASU 2015-03, <i>Simplifying the Presentation of Debt Issuance Costs</i>. 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 2015-03 is effective for annual and interim reporting periods beginning after December 15, 2015. Early adoption is permitted. We are currently evaluating the impact this guidance may have on our financial statements.</p><br/><p style="font-size: 10pt; margin: 0pt 0; color: #252525">In July 2015, the FASB issued ASU No.&nbsp;2015-11<i>,&nbsp;Inventory (Topic 330): Simplifying the Measurement of Inventory</i>, 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 December&nbsp;15, 2016, including interim periods within that reporting period. We are currently evaluating the impact this guidance may have on our financial statements.</p><br/><p style="font-size: 10pt; margin: 0"><b>Valuation of Intangible Assets</b></p><br/><p style="font-size: 10pt; margin: 0">We review identifiable intangible assets for impairment in accordance with ASC 350 &#x2014; Intangibles &#x2014;Goodwill and Other, whenever events or changes in circumstances indicate the carrying amount may 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 may 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&#x2019;s best estimate of the related risks and return at the time the impairment assessment is made.</p><br/><p style="font-size: 10pt; margin: 0"><b>Accounting Policies and Estimates</b></p><br/><p style="font-size: 10pt; margin: 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.</p><br/><p style="font-size: 10pt; margin: 0"><b>Presentation of Taxes Collected from Customers</b></p><br/><p style="font-size: 10pt; margin: 0">Sales taxes are imposed on the Company&#x2019;s sales to nonexempt customers. The Company collects the taxes from customers and remits the entire amounts to the governmental authorities. The Company&#x2019;s accounting policy is to exclude the taxes collected and remitted from revenues and expenses.</p><br/><p style="font-size: 10pt; margin: 0"><b>Shipping and Handling</b></p><br/><p style="font-size: 10pt; margin: 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.</p><br/><p style="font-size: 10pt; margin: 0"><b>Advertising</b></p><br/><p style="font-size: 10pt; margin: 0">Advertising costs are expensed as incurred. Advertising expenses were $500 and $1,917 in the three and nine months ended September 30, 2015 and were $4,201 and $11,994 in the three and nine months ended September 30, 2014.</p><br/><p style="font-size: 10pt; margin: 0"><b>Research and Development</b></p><br/><p style="font-size: 10pt; margin: 0">Research and development costs are charged to operations as incurred. Research and development expenses were $58,792 and $179,739 in the three and nine months ended September 30, 2015 and were $72,294 and $321,929 in the three and nine months ended September 30, 2014.</p><br/><p style="font-size: 10pt; margin: 0"><b>Revenue Recognition</b></p><br/><p style="font-size: 10pt; margin: 0">The Company recognizes revenue in accordance with the SEC&#x2019;s Staff Accounting Bulletin Topic 13 Revenue Recognition and ASC 605-Revenue Recognition.</p><br/><p style="font-size: 10pt; margin: 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&#x2019;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 FMS 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&#x2019;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&#x2019;s right of return is limited only to the Company&#x2019;s standard one-year warranty whereby the Company replaces or repairs, at its option, and it would be rare that the STREAMWAY FMS unit or significant quantities of cleaning solution kits may be returned. Additionally, since the Company buys both the STREAMWAY FMS units and cleaning solution kits from &#x201c;turnkey&#x201d; suppliers, the Company would have the right to replacements from the suppliers if this situation should occur.</p><br/><p style="font-size: 10pt; margin: 0"><b>Receivables</b></p><br/><p style="font-size: 10pt; margin: 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&#x2019;s assessment of the current status of individual accounts, changes to the valuation allowance have not been material to the financial statements.</p><br/><p style="font-size: 10pt; margin: 0"><b>Inventories</b></p><br/><p style="font-size: 10pt; margin: 0">Inventories are stated at the lower of cost or market, with cost determined on a first-in, first-out basis. Inventory balances are as&nbsp;follows:</p><br/><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">September&nbsp;30,<br /> 2015</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">December&nbsp;31,<br /> 2014</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="width: 70%; font-size: 10pt; text-align: left">Finished goods</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">46,208</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">88,362</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">Raw materials</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">182,994</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">237,556</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; padding-bottom: 1pt">Work-In-Process</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">7,688</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">41,449</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; padding-bottom: 2.25pt">Total</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">236,890</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">367,367</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> </tr> </table><br/><p style="font-size: 10pt; margin: 0"><b>Property and Equipment</b></p><br/><p style="font-size: 10pt; margin: 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:</p><br/><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="5" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Years</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left; width: 85%">Computers and office equipment</td> <td style="font-size: 10pt; width: 1%">&nbsp;</td> <td style="font-size: 10pt; text-align: left; width: 1%">&nbsp;</td> <td style="font-size: 10pt; text-align: center; width: 4%"><font style="font-size: 10pt">3 </font></td> <td style="font-size: 10pt; text-align: center; width: 4%"><font style="font-size: 10pt">- </font></td> <td style="font-size: 10pt; text-align: center; width: 4%"><font style="font-size: 10pt">7</font></td> <td style="font-size: 10pt; text-align: left; width: 1%">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">Leasehold improvements</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: center">5</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">Manufacturing tooling</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">3 </font></td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">- </font></td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">7</font></td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">Demo Equipment</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: center">3</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> </table><br/><p style="font-size: 10pt; margin: 0">The Company&#x2019;s investment in Fixed Assets consists of the following:</p><br/><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">September 30,<br /> 2015</td> <td style="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">December 31,<br /> 2014</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 70%; font-size: 10pt; font-weight: bold; text-align: left">Computers and office equipment</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">121,901</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">123,708</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; font-weight: bold; text-align: left">Leasehold improvements</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">23,874</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">23,874</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; font-weight: bold; text-align: left">Manufacturing tooling</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">97,288</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">97,288</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Demo Equipment</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">8,962</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">30,576</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; font-weight: bold; padding-left: 10pt">Total</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">252,025</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">275,446</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Less: Accumulated depreciation</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">125,455</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">78,967</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 2.25pt; padding-left: 10pt">Total Fixed Assets, Net</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">126,570</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">196,479</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> </tr> </table><br/><p style="font-size: 10pt; margin: 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.</p><br/><p style="font-size: 10pt; margin: 0"><b>Intangible Assets</b></p><br/><p style="font-size: 10pt; margin: 0">Intangible assets consist of trademarks and patent costs. Amortization expense was $1,632 and $4,520 in the three and nine months ended September 30, 2015, and was $0 in the three and nine months ended September 30, 2014. The assets are reviewed for impairment annually, and impairment losses, if any, are charged to operations when identified.</p><br/><p style="font-size: 10pt; margin: 0"><b>Income Taxes</b></p><br/><p style="font-size: 10pt; margin: 0">The Company accounts for income taxes in accordance with ASC 740- Income Taxes (&#x201c;ASC 740&#x201d;). Under ASC 740, 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.</p><br/><p style="font-size: 10pt; margin: 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.</p><br/><p style="font-size: 10pt; margin: 0">Tax years subsequent to 2011 remain open to examination by federal and state tax authorities.</p><br/><p style="font-size: 10pt; margin: 0"><b>Patents and Intellectual Property</b></p><br/><p style="font-size: 10pt; margin: 0">On January 25th, 2014 the Company filed a non-provisional PCT Application No. PCT/US2014/013081 claiming priority from the U.S. Provisional Patent Application, number 61756763 which was filed one year earlier on January 25th, 2013. The Patent Cooperation Treaty (&#x201c;PCT&#x201d;) allows an applicant to file a single patent application to seek patent protection for an invention simultaneously in each of the 148 countries of the PCT, including the United States. By filing this single &#x201c;international&#x201d; 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.</p><br/><p style="font-size: 10pt; margin: 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.</p><br/><p style="font-size: 10pt; margin: 0">The Company holds the following granted patents in the United States and a pending application in the United States on its earlier models: US7469727, US8123731 and U.S. Publication No. US20090216205 (collectively, the &#x201c;Patents&#x201d;). These Patents will begin to expire on August 8, 2023.</p><br/><p style="font-size: 10pt; margin: 0"><font style="color: Black">In July 2015, 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.&nbsp; Skyline anticipates that the favorable International Search Report will result in allowance of its various national applications.</font></p><br/><p style="font-size: 10pt; margin: 0"><b>Subsequent Events</b></p><br/><p style="font-size: 10pt; margin: 0pt 0">In preparing these financial statements the Company evaluated for recognition or disclosure the events or transactions that occurred through November 13, 2015, the date of this filing. Except as discussed in Note 11 there were no subsequent events that required recognition or disclosure in the financial statements.</p><br/><p style="font-size: 10pt; margin: 0"><b>Interim Financial Statements</b></p><br/><p style="font-size: 10pt; margin: 0">The Company has prepared the unaudited interim financial statements and related unaudited financial information in the footnotes in accordance with accounting principles generally accepted in the United States of America (&#x201c;GAAP&#x201d;) and the rules and regulations of the Securities and Exchange Commission (&#x201c;SEC&#x201d;) for interim financial statements. These interim financial statements reflect all adjustments consisting of normal recurring accruals, which, in the opinion of management, are necessary to present fairly the Company&#x2019;s financial position, the results of its operations and its cash flows for the interim periods. These interim financial statements should be read in conjunction with the annual financial statements and the notes thereto contained in the Form 10-K filed with the SEC on April 30, 2015. The nature of the Company&#x2019;s business is such that the results of any interim period may not be indicative of the results to be expected for the entire year.</p><br/> 5203428 0.01 22723061 2055000 13555003 5685000 <p style="font-size: 10pt; margin: 0"><b>Recent Accounting Developments</b></p><br/><p style="font-size: 10pt; margin: 0">In May 2014, the Financial Accounting Standards Board (&#x201c;FASB&#x201d;) issued ASU 2014-09, <i>Revenue from Contracts with Customers </i>and created a new topic in the FASB Accounting Standards Codification ("ASC"), Topic 606. The new standard provides 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 December 15, 2017, including interim periods within that reporting period. Early application is not permitted. We are currently evaluating the impact this guidance may have on our financial statements and related disclosures.</p><br/><p style="font-size: 10pt; margin: 0">In June 2014, the FASB issued ASU 2014-12, <i>"Compensation - Stock Compensation" </i>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 December 15, 2015. Early adoption is permitted. We are currently evaluating the impact this guidance may have on our financial statements.</p><br/><p style="font-size: 10pt; margin: 0">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.</p><br/><p style="font-size: 10pt; margin: 0pt 0; color: #252525">In April 2015, the FASB issued ASU 2015-03, <i>Simplifying the Presentation of Debt Issuance Costs</i>. 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 2015-03 is effective for annual and interim reporting periods beginning after December 15, 2015. Early adoption is permitted. We are currently evaluating the impact this guidance may have on our financial statements.</p><br/><p style="font-size: 10pt; margin: 0pt 0; color: #252525">In July 2015, the FASB issued ASU No.&nbsp;2015-11<i>,&nbsp;Inventory (Topic 330): Simplifying the Measurement of Inventory</i>, 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 December&nbsp;15, 2016, including interim periods within that reporting period. We are currently evaluating the impact this guidance may have on our financial statements.</p> <p style="font-size: 10pt; margin: 0"><b>Valuation of Intangible Assets</b></p><br/><p style="font-size: 10pt; margin: 0">We review identifiable intangible assets for impairment in accordance with ASC 350 &#x2014; Intangibles &#x2014;Goodwill and Other, whenever events or changes in circumstances indicate the carrying amount may 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 may 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&#x2019;s best estimate of the related risks and return at the time the impairment assessment is made.</p> <p style="font-size: 10pt; margin: 0"><b>Accounting Policies and Estimates</b></p><br/><p style="font-size: 10pt; margin: 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.</p> <p style="font-size: 10pt; margin: 0"><b>Presentation of Taxes Collected from Customers</b></p><br/><p style="font-size: 10pt; margin: 0">Sales taxes are imposed on the Company&#x2019;s sales to nonexempt customers. The Company collects the taxes from customers and remits the entire amounts to the governmental authorities. The Company&#x2019;s accounting policy is to exclude the taxes collected and remitted from revenues and expenses.</p> <p style="font-size: 10pt; margin: 0"><b>Shipping and Handling</b></p><br/><p style="font-size: 10pt; margin: 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.</p> <p style="font-size: 10pt; margin: 0"><b>Advertising</b></p><br/><p style="font-size: 10pt; margin: 0">Advertising costs are expensed as incurred. Advertising expenses were $500 and $1,917 in the three and nine months ended September 30, 2015 and were $4,201 and $11,994 in the three and nine months ended September 30, 2014.</p> 500 1917 4201 11994 <p style="font-size: 10pt; margin: 0"><b>Research and Development</b></p><br/><p style="font-size: 10pt; margin: 0">Research and development costs are charged to operations as incurred. Research and development expenses were $58,792 and $179,739 in the three and nine months ended September 30, 2015 and were $72,294 and $321,929 in the three and nine months ended September 30, 2014.</p> 58792 179739 72294 321929 <p style="font-size: 10pt; margin: 0"><b>Revenue Recognition</b></p><br/><p style="font-size: 10pt; margin: 0">The Company recognizes revenue in accordance with the SEC&#x2019;s Staff Accounting Bulletin Topic 13 Revenue Recognition and ASC 605-Revenue Recognition.</p><br/><p style="font-size: 10pt; margin: 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&#x2019;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 FMS 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&#x2019;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&#x2019;s right of return is limited only to the Company&#x2019;s standard one-year warranty whereby the Company replaces or repairs, at its option, and it would be rare that the STREAMWAY FMS unit or significant quantities of cleaning solution kits may be returned. Additionally, since the Company buys both the STREAMWAY FMS units and cleaning solution kits from &#x201c;turnkey&#x201d; suppliers, the Company would have the right to replacements from the suppliers if this situation should occur.</p> <p style="font-size: 10pt; margin: 0"><b>Receivables</b></p><br/><p style="font-size: 10pt; margin: 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&#x2019;s assessment of the current status of individual accounts, changes to the valuation allowance have not been material to the financial statements.</p> <p style="font-size: 10pt; margin: 0"><b>Inventories</b></p><br/><p style="font-size: 10pt; margin: 0">Inventories are stated at the lower of cost or market, with cost determined on a first-in, first-out basis. Inventory balances are as&nbsp;follows:</p><br/><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">September&nbsp;30,<br /> 2015</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">December&nbsp;31,<br /> 2014</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="width: 70%; font-size: 10pt; text-align: left">Finished goods</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">46,208</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">88,362</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">Raw materials</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">182,994</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">237,556</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; padding-bottom: 1pt">Work-In-Process</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">7,688</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">41,449</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; padding-bottom: 2.25pt">Total</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">236,890</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">367,367</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> </tr> </table> <p style="font-size: 10pt; margin: 0"><b>Property and Equipment</b></p><br/><p style="font-size: 10pt; margin: 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:</p><br/><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="5" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Years</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left; width: 85%">Computers and office equipment</td> <td style="font-size: 10pt; width: 1%">&nbsp;</td> <td style="font-size: 10pt; text-align: left; width: 1%">&nbsp;</td> <td style="font-size: 10pt; text-align: center; width: 4%"><font style="font-size: 10pt">3 </font></td> <td style="font-size: 10pt; text-align: center; width: 4%"><font style="font-size: 10pt">- </font></td> <td style="font-size: 10pt; text-align: center; width: 4%"><font style="font-size: 10pt">7</font></td> <td style="font-size: 10pt; text-align: left; width: 1%">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">Leasehold improvements</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: center">5</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">Manufacturing tooling</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">3 </font></td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">- </font></td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">7</font></td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">Demo Equipment</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: center">3</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> </table><br/><p style="font-size: 10pt; margin: 0">The Company&#x2019;s investment in Fixed Assets consists of the following:</p><br/><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">September 30,<br /> 2015</td> <td style="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">December 31,<br /> 2014</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 70%; font-size: 10pt; font-weight: bold; text-align: left">Computers and office equipment</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">121,901</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">123,708</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; font-weight: bold; text-align: left">Leasehold improvements</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">23,874</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">23,874</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; font-weight: bold; text-align: left">Manufacturing tooling</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">97,288</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">97,288</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Demo Equipment</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">8,962</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">30,576</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; font-weight: bold; padding-left: 10pt">Total</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">252,025</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">275,446</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Less: Accumulated depreciation</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">125,455</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">78,967</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 2.25pt; padding-left: 10pt">Total Fixed Assets, Net</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">126,570</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">196,479</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> </tr> </table><br/><p style="font-size: 10pt; margin: 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.</p> <p style="font-size: 10pt; margin: 0"><b>Intangible Assets</b></p><br/><p style="font-size: 10pt; margin: 0">Intangible assets consist of trademarks and patent costs. Amortization expense was $1,632 and $4,520 in the three and nine months ended September 30, 2015, and was $0 in the three and nine months ended September 30, 2014. The assets are reviewed for impairment annually, and impairment losses, if any, are charged to operations when identified.</p> 1632 4520 0 0 <p style="font-size: 10pt; margin: 0"><b>Income Taxes</b></p><br/><p style="font-size: 10pt; margin: 0">The Company accounts for income taxes in accordance with ASC 740- Income Taxes (&#x201c;ASC 740&#x201d;). Under ASC 740, 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.</p><br/><p style="font-size: 10pt; margin: 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.</p><br/><p style="font-size: 10pt; margin: 0">Tax years subsequent to 2011 remain open to examination by federal and state tax authorities.</p> 2011 <p style="font-size: 10pt; margin: 0"><b>Patents and Intellectual Property</b></p><br/><p style="font-size: 10pt; margin: 0">On January 25th, 2014 the Company filed a non-provisional PCT Application No. PCT/US2014/013081 claiming priority from the U.S. Provisional Patent Application, number 61756763 which was filed one year earlier on January 25th, 2013. The Patent Cooperation Treaty (&#x201c;PCT&#x201d;) allows an applicant to file a single patent application to seek patent protection for an invention simultaneously in each of the 148 countries of the PCT, including the United States. By filing this single &#x201c;international&#x201d; 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.</p><br/><p style="font-size: 10pt; margin: 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.</p><br/><p style="font-size: 10pt; margin: 0">The Company holds the following granted patents in the United States and a pending application in the United States on its earlier models: US7469727, US8123731 and U.S. Publication No. US20090216205 (collectively, the &#x201c;Patents&#x201d;). These Patents will begin to expire on August 8, 2023.</p><br/><p style="font-size: 10pt; margin: 0"><font style="color: Black">In July 2015, 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.&nbsp; Skyline anticipates that the favorable International Search Report will result in allowance of its various national applications.</font></p> <p style="font-size: 10pt; margin: 0"><b>Subsequent Events</b></p><br/><p style="font-size: 10pt; margin: 0pt 0">In preparing these financial statements the Company evaluated for recognition or disclosure the events or transactions that occurred through November 13, 2015, the date of this filing. Except as discussed in Note 11 there were no subsequent events that required recognition or disclosure in the financial statements.</p> <p style="font-size: 10pt; margin: 0"><b>Interim Financial Statements</b></p><br/><p style="font-size: 10pt; margin: 0">The Company has prepared the unaudited interim financial statements and related unaudited financial information in the footnotes in accordance with accounting principles generally accepted in the United States of America (&#x201c;GAAP&#x201d;) and the rules and regulations of the Securities and Exchange Commission (&#x201c;SEC&#x201d;) for interim financial statements. These interim financial statements reflect all adjustments consisting of normal recurring accruals, which, in the opinion of management, are necessary to present fairly the Company&#x2019;s financial position, the results of its operations and its cash flows for the interim periods. These interim financial statements should be read in conjunction with the annual financial statements and the notes thereto contained in the Form 10-K filed with the SEC on April 30, 2015. The nature of the Company&#x2019;s business is such that the results of any interim period may not be indicative of the results to be expected for the entire year.</p> <table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">September&nbsp;30,<br /> 2015</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">December&nbsp;31,<br /> 2014</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="width: 70%; font-size: 10pt; text-align: left">Finished goods</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">46,208</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">88,362</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">Raw materials</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">182,994</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">237,556</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; padding-bottom: 1pt">Work-In-Process</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">7,688</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">41,449</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; padding-bottom: 2.25pt">Total</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">236,890</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">367,367</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> </tr> </table> 46208 88362 182994 237556 7688 41449 <table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="5" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Years</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left; width: 85%">Computers and office equipment</td> <td style="font-size: 10pt; width: 1%">&nbsp;</td> <td style="font-size: 10pt; text-align: left; width: 1%">&nbsp;</td> <td style="font-size: 10pt; text-align: center; width: 4%"><font style="font-size: 10pt">3 </font></td> <td style="font-size: 10pt; text-align: center; width: 4%"><font style="font-size: 10pt">- </font></td> <td style="font-size: 10pt; text-align: center; width: 4%"><font style="font-size: 10pt">7</font></td> <td style="font-size: 10pt; text-align: left; width: 1%">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">Leasehold improvements</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: center">5</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">Manufacturing tooling</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">3 </font></td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">- </font></td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">7</font></td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">Demo Equipment</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: center">3</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> </table> P3Y P7Y P5Y P3Y P7Y P3Y <table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">September 30,<br /> 2015</td> <td style="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">December 31,<br /> 2014</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 70%; font-size: 10pt; font-weight: bold; text-align: left">Computers and office equipment</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">121,901</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">123,708</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; font-weight: bold; text-align: left">Leasehold improvements</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">23,874</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">23,874</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; font-weight: bold; text-align: left">Manufacturing tooling</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">97,288</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">97,288</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Demo Equipment</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">8,962</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">30,576</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; font-weight: bold; padding-left: 10pt">Total</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">252,025</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">275,446</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Less: Accumulated depreciation</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">125,455</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">78,967</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 2.25pt; padding-left: 10pt">Total Fixed Assets, Net</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">126,570</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">196,479</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> </tr> </table> 121901 123708 23874 23874 97288 97288 8962 30576 252025 275446 125455 78967 <p style="font-size: 10pt; margin: 0"><b>NOTE 2 &#x2013; DEVELOPMENT STAGE OPERATIONS</b></p><br/><p style="font-size: 10pt; margin: 0">The Company was formed April 23, 2002. Since inception to September 30, 2015, 5,203,428 shares of common stock have been issued between par value and $125.25. Operations since incorporation have been devoted to raising capital, obtaining financing, development of the Company&#x2019;s product, and administrative services, customer acceptance and sales and marketing strategies.</p><br/> 5203428 125.25 <p style="font-size: 10pt; margin: 0"><b>NOTE 3 &#x2013; STOCKHOLDERS&#x2019; DEFICIT, STOCK OPTIONS AND WARRANTS</b></p><br/><p style="font-size: 10pt; margin: 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 three years. Options under this plan have terms ranging from three to ten years.</p><br/><p style="font-size: 10pt; margin: 0 0 8pt">On August 25, 2015, the Company, in connection with a public offering (the &#x201c;Offering&#x201d;) of the Units, entered into an underwriting agreement (the &#x201c;Underwriting Agreement&#x201d;) with Dawson James Securities, Inc., as underwriter (the &#x201c;Underwriter&#x201d;). Pursuant to the Underwriting Agreement, the Company agreed to sell 1,666,667 Units. The public offering price for the Units was $9.00 per Unit and the purchase price for the Underwriter under the Underwriting Agreement was $8.28 per Unit, resulting in an underwriting discount and commission of $0.72 (or 8.00%) per Unit and total net proceeds to the Company before expenses of $13.8 million. The Company had granted the Underwriter an option for a period of 45 days to purchase up to an additional 250,000 Units solely to cover over-allotments. The Underwriter chose not to purchase any additional Units under the over-allotment option.</p><br/><p style="font-size: 10pt; margin: 0 0 8pt">Pursuant to the Underwriting Agreement, the Company agreed to issue to the Underwriter a unit purchase option (the &#x201c;Unit Purchase Option&#x201d;) more fully described below. The Company had also agreed to pay the Underwriter a non-accountable expense allowance equal to 1% of the gross proceeds of the Offering (excluding any proceeds from the over-allotment option, if any), as well as to reimburse expenses incurred by the Underwriter up to $70,000.</p><br/><p style="font-size: 10pt; margin: 0">Pursuant to the Underwriting Agreement, the Company agreed to indemnify the Underwriter against certain liabilities, including liabilities under the Securities Act, and liabilities arising from breaches of representations and warranties contained in the Underwriting Agreement, or to contribute to payments that the Underwriter may be required to make in respect of those liabilities. The Underwriting Agreement also contains representations, warranties, conditions precedent to closing and other provisions customary for transactions of this nature.</p><br/><p style="font-size: 10pt; margin: 0 0 8pt"><u>Unit Agreement</u></p><br/><p style="font-size: 10pt; margin: 6pt 0.75pt 8pt">The Units were issued pursuant to a Unit Agreement, dated August 31, 2015, between the Company and Corporate Stock Transfer, Inc. (the &#x201c;Unit Agreement&#x201d;). Each Unit consists of one share of common stock, par value $0.01 per share (the &#x201c;Common Stock&#x201d;), one share of Series B Convertible Preferred Stock and four Series A Warrants. The shares of Common Stock, the shares of Series B Convertible Preferred Stock and the Series A Warrants that comprise the Units will automatically separate on February 29, 2016, which is the six month anniversary of August 31, 2015 (the &#x201c;Issuance Date&#x201d;). However, the shares of Common Stock, the shares of Series B Convertible Preferred Stock and the Series A Warrants will separate prior to the expiration of such six-month anniversary if at any time after September 30, 2015, either (i) the closing price of the Company&#x2019;s common stock on the NASDAQ Capital Market is greater than 200% of the Series A Warrants exercise price for a period of 20 consecutive trading days (the &#x201c;Trading Separation Trigger&#x201d;), (ii) all Series A Warrants in a given Unit are exercised for cash (solely with respect to the Units that include the exercised Series A Warrants) (a &#x201c;Warrant Cash Exercise Trigger&#x201d;) or (iii) the Units are delisted (the &#x201c;Delisting Trigger&#x201d;) from the NASDAQ Capital Market for any reason (any such event, a &#x201c;Separation Trigger Event&#x201d;). Upon the occurrence of a Separation Trigger Event, the Units will separate: (i) 15 days after the date of the Trading Separation Trigger, (ii) on the date of any Warrant Cash Exercise Trigger (solely with respect to the Units that include the exercised Series A Warrants) or (iii) the date of the Delisting Trigger, as the case may be. This separation of the Units prior to February 29, 2016 is referred to herein as an &#x201c;Early Separation.&#x201d;</p><br/><p style="font-size: 10pt; margin: 0pt 0">For a description of the terms of the Series B Convertible Preferred Stock included within the Units, see &#x201c;Certificate of Designation for Series B Preferred Stock&#x201d; below. For a description of the terms of the Series A Warrants included within the Units, see &#x201c;Series A Warrants&#x201d; below.</p><br/><p style="font-size: 10pt; margin: 6pt 0.75pt 8pt"><u>Warrant Agreement / Series A Warrants</u></p><br/><p style="font-size: 10pt; margin: 0">The Series A Warrants are issued pursuant to the Warrant Agency Agreement, dated as of August 31, 2015 between the Company and Corporate Stock Transfer, Inc. (the &#x201c;Warrant Agreement&#x201d;). The Series A Warrants are exercisable upon the separation of the Units, provided that all Series A Warrants in a given Unit may be exercised for cash at any time commencing 30 days after the Issuance Date. The Series A Warrants will terminate on the fifth anniversary of the Issuance Date. Each Series A Warrant is exercisable into one share of our common stock at an initial cash exercise price of $4.95 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.</p><br/><p style="font-size: 10pt; margin: 6pt 0.75pt 8pt">Holders may 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 &#x201c;Cashless Exercise.&#x201d;</p><br/><p style="font-size: 10pt; margin: 6pt 0.75pt 8pt">Total Shares = (A x B) / C</p><br/><p style="font-size: 10pt; margin: 6pt 0.75pt 8pt">Where:</p><br/><table cellpadding="0" cellspacing="0" width="100%" style="font-size: 10pt; margin-top: 6pt; margin-bottom: 8pt"> <tr style="vertical-align: top"> <td style="width: 18.75pt"></td> <td style="width: 18pt"><font style="font-family: Symbol">&middot;</font></td> <td style="padding-right: 0.75pt">Total Shares is the number of shares of Common Stock to be issued upon a Cashless Exercise.</td> </tr> </table><br/><table cellpadding="0" cellspacing="0" width="100%" style="font-size: 10pt; margin-top: 6pt; margin-bottom: 8pt"> <tr style="vertical-align: top"> <td style="width: 18.75pt"></td> <td style="width: 18pt"><font style="font-family: Symbol">&middot;</font></td> <td style="padding-right: 0.75pt">A is the total number of shares with respect to which the Series A Warrant is then being exercised.</td> </tr> </table><br/><table cellpadding="0" cellspacing="0" width="100%" style="font-size: 10pt; margin-top: 6pt; margin-bottom: 8pt"> <tr style="vertical-align: top"> <td style="width: 18.75pt"></td> <td style="width: 18pt"><font style="font-family: Symbol">&middot;</font></td> <td style="padding-right: 0.75pt">B is the Black Scholes Value (as defined below).</td> </tr> </table><br/><table cellpadding="0" cellspacing="0" width="100%" style="font-size: 10pt; margin-top: 6pt; margin-bottom: 8pt"> <tr style="vertical-align: top"> <td style="width: 18.75pt"></td> <td style="width: 18pt"><font style="font-family: Symbol">&middot;</font></td> <td style="padding-right: 0.75pt">C is the closing bid price of the Common Stock as of two trading days prior to the time of such exercise, provided that in no event may &#x201c;C&#x201d; be less than $0.43 per share (subject to appropriate adjustment in the event of stock dividends, stock splits or similar events affecting the Common Stock).</td> </tr> </table><br/><p style="font-size: 10pt; margin: 6pt 0.75pt 8pt">As defined in the Series A Warrants, &#x201c;Black Scholes Value&#x201d; means the Black Scholes value of an option for one share of Common Stock at the date of the applicable Cashless Exercise, as such Black Scholes Value is determined, calculated using the Black Scholes Option Pricing Model obtained from the &#x201c;OV&#x201d; function on Bloomberg utilizing (i) an underlying price per share equal to 55% of the Unit price, or $4.95 per share, (ii) a risk-free interest rate corresponding to the U.S. Treasury rate for a period equal to the remaining term of the Series A Warrant as of the applicable Cashless Exercise, (iii) a strike price equal to the exercise price in effect at the time of the applicable Cashless Exercise, (iv) an expected volatility equal to 135% and (v) a remaining term of such option equal to five years (regardless of the actual remaining term of the Series A Warrant). The Cashless Exercise feature of the Series A Warrants provides for the issuance of a number of shares of Common Stock that increases as the trading market price of the Common Stock decreases, subject to a floor price of $0.43. If all of the 7,580,040 Series A Warrants that were issued as part of the Units sold in the Offering and part of the Exchange Units issued on August 31, 2015, as described below, were exercised pursuant to a Cashless Exercise and the closing bid price of the Common Stock as of the two trading days prior to the time of such exercise was $0.43 per share or less and the Black Scholes Value was $4.326 (the Black Scholes Value as of August 28, 2015), then a total of approximately 76.3 million shares of Common Stock would be issued to the holders of such Series A Warrants.&nbsp; The potential for such dilutive exercise of the Series A Warrants may depress the price of Common Stock regardless of the Company&#x2019;s business performance, and could encourage short selling by market participants, especially if the trading price of the Common Stock begins to decrease.</p><br/><p style="font-size: 10pt; margin: 6pt 0.75pt 8pt">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 4.99% of the common stock of the Company, determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended, and the regulations promulgated thereunder.</p><br/><p style="font-size: 10pt; margin: 6pt 0.75pt 8pt">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, if the Company, at any time prior to the three year anniversary of the Issuance Date:</p><br/><table cellpadding="0" cellspacing="0" width="100%" style="font-size: 10pt; margin-top: 6pt; margin-bottom: 8pt"> <tr style="vertical-align: top"> <td style="width: 0.25in"></td> <td style="width: 0.25in">(i)</td> <td style="padding-right: 0.75pt">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 (a &#x201c;Distribution&#x201d;), at any time after the Issuance Date, then, in each such case, the holders of the Series A Warrants will be entitled to participate in such Distribution to the same extent that the holders would have participated therein if the holder had held the number of shares of Common Stock acquirable upon complete exercise of the Series A Warrants by either paying the exercise price for such shares of Common Stock in cash in full or by exercising the Series A Warrants in full pursuant to a Cashless Exercise, whichever results in the lesser number of shares of Common Stock issued, as of the date immediately preceding the date on which a record is taken for such Distribution, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the participation in such Distribution; or</td> </tr> </table><br/><table cellpadding="0" cellspacing="0" width="100%" style="font-size: 10pt; margin-top: 6pt; margin-bottom: 8pt"> <tr style="vertical-align: top"> <td style="width: 0.25in"></td> <td style="width: 0.25in">(ii)</td> <td style="padding-right: 0.75pt">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 (the &#x201c;Purchase Rights&#x201d;), then the holders of Series A Warrants will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the holder could have acquired if the holder had held the number of shares of Common Stock acquirable upon complete exercise of the Series A Warrant by either paying the exercise price for such shares of Common Stock in cash in full or by exercising the Series A Warrant in full pursuant to a Cashless Exercise, whichever results in the lesser number of shares of Common Stock issued, as of the date immediately preceding the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights.</td> </tr> </table><br/><p style="font-size: 10pt; margin: 6pt 0.75pt 8pt">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 of 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.</p><br/><p style="font-size: 10pt; margin: 6pt 0.75pt 8pt"><u>Unit Purchase Option</u></p><br/><p style="font-size: 10pt; margin: 6pt 0.75pt 8pt">Pursuant to the Underwriting Agreement, the Company, in connection with the Offering, entered into a Unit Purchase Option Agreement, dated as of August 31, 2015 (the &#x201c;Unit Purchase Option&#x201d;), pursuant to which the Company granted the Underwriter the right to purchase from the Company up to a number of Units equal to 5% of the Units sold in the Offering (or up to 83,333 Units) at an exercise price equal to 125% of the public offering price of the Units in the Offering, or $11.25 per Unit. The Unit Purchase Option shall expire on August 25, 2018.</p><br/><p style="font-size: 10pt; margin: 6pt 0.75pt 8pt"><u>Unit Exchange</u></p><br/><p style="font-size: 10pt; margin: 6pt 0.75pt 8pt">On February 4, 2014, the Company raised $2,055,000 in gross proceeds from a private placement of 20,550 shares of Series A Convertible Preferred Stock, par value $0.01, with a stated value of $100 per share (the &#x201c;Series A Preferred Shares&#x201d;) and warrants to purchase shares of the Company&#x2019;s common stock. The Series A Preferred Shares and warrants were sold to investors pursuant to a Securities Purchase Agreement, dated as of February 4, 2014.</p><br/><p style="font-size: 10pt; margin: 6pt 0.75pt 8pt">In connection with the Offering, the holders of the Series A Preferred Shares agreed to exchange all of the outstanding Series A Preferred Shares for units with the same terms as the Units (the &#x201c;Exchange Units&#x201d;) such that for every dollar of stated value of Series A Preferred Shares tendered the holders would receive an equivalent value of Exchange Units based on the public offering price of the Units in this offering (the &#x201c;Unit Exchange&#x201d;). The warrants that were issued in connection with the issuance of the Series A Preferred Shares would remain outstanding; however, the warrant amounts would be reduced so that the warrants will be exercisable into an aggregate of 84,770 shares of the Company&#x2019;s common stock. The Exchange Units were exempt from registration under the Securities Act pursuant to Section m3(a)(9) thereof.</p><br/><p style="font-size: 10pt; margin: 6pt 0.75pt 8pt">On August 31, 2015, the Company consummated the Unit Exchange whereby the Company issued a total of 228,343 Units (the &#x201c;Exchange Units&#x201d;) in exchange for the outstanding Series A Convertible Preferred Stock which were then cancelled. The Exchange Units were exempt from registration under the Securities Act pursuant to Section 3(a)(9) thereof.</p><br/><p style="font-size: 10pt; margin: 6pt 0.75pt 8pt"><u>Certificate of Designation for the Series B Convertible Preferred Stock</u></p><br/><p style="font-size: 10pt; margin: 6pt 0.75pt 8pt">On August 28, 2015, the Company filed the Certificate of Designation of Preferences, Rights and Limitations of Series B Convertible Preferred Stock (the &#x201c;Certificate of Designation&#x201d;) with the Delaware Secretary of State. The Certificate of Designation creates the Series B Convertible Preferred Stock and fixes the rights, preferences, powers, restrictions and limitations of the Series B Convertible Preferred Stock. The Series B Convertible Preferred Stock is a component of the Units being offered pursuant to the Offering, Units that could be issued upon exercise by the Underwriter of the Unit Purchase Option described in Item 1.01 above and also part of the Exchange Units described in Item 3.02 above.</p><br/><p style="font-size: 10pt; margin: 6pt 0.7pt 8pt">Each share of Series B Convertible Preferred Stock is convertible into one share of Common Stock (subject to appropriate adjustment in the event of stock dividends, stock splits, reorganizations or similar events) on the six month anniversary of the Issuance Date or on the date of an Early Separation. In addition, the Series B Convertible Preferred Stock will automatically convert into shares of common stock upon the occurrence of a Fundamental Transaction, subject to the beneficial ownership limitation discussed below. A &#x201c;Fundamental Transaction&#x201d; means that (i) the Company shall, directly or indirectly, in one or more related transactions, (1) consolidate or merge with or into (whether or not the Company is the surviving corporation) any other person unless the shareholders of the Company immediately prior to such consolidation or merger continue to hold more than 50% of the outstanding shares of voting stock after such consolidation or merger, or (2)&nbsp;sell, lease, license, assign, transfer, convey or otherwise dispose of all or substantially all of the properties and assets of the Company and its subsidiaries, taken as a whole, to any other person, or (3) allow any other person to make a purchase, tender or exchange offer that is accepted by the holders of more than 50% of the outstanding shares of voting stock of the Company (not including any shares of voting stock of the Company held by the person or persons making or party to, or associated or affiliated with the persons making or party to, such purchase, tender or exchange offer), or (4) consummate a stock or share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with any other person whereby such other person acquires more than 50% of the outstanding shares of voting stock of the Company (not including any shares of voting stock of the Company held by the other person or other persons making or party to, or associated or affiliated with the other persons making or party to, such stock or share purchase agreement or other business combination), or (ii) any &#x201c;person&#x201d; or &#x201c;group&#x201d; (as these terms are used for purposes of Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the &#x201c;Exchange Act&#x201d;) and the rules and regulations promulgated thereunder), other than a Permitted Holder, is or shall become the &#x201c;beneficial owner&#x201d; (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of 50% of the aggregate ordinary voting power represented by issued and outstanding voting stock of the Company. The term Permitted Holders means Josh Kornberg, Atlantic Partners Alliance and SOK Partners, LLC and each of their respective affiliates.</p><br/><p style="font-size: 10pt; margin: 0">The Series B Convertible Preferred Stock will not be 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 4.99% of the common stock of the Company. For purposes of the limitation described in this paragraph, beneficial ownership and all determinations and calculations are determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder.</p><br/><p style="font-size: 10pt; margin: 0 0 6pt">The Series B Convertible Preferred Stock has no voting rights, except that the holders of shares of a majority of the Series B Convertible Preferred Stock will be required to effect or validate any amendment, alteration or repeal of any of the provisions of the Certificate of Designation that materially adversely affects the powers, preferences or special rights of the Series B Convertible Preferred Stock, whether by merger or consolidation or otherwise, subject to certain exceptions set forth in the Certificate of Designations.</p><br/><p style="font-size: 10pt; margin: 6pt 0.75pt 8pt">With respect to payment of dividends and distribution of assets upon liquidation or dissolution or winding up of the Company, the Series B Convertible 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 Convertible Preferred Stock.</p><br/><p style="font-size: 10pt; margin: 6pt 0.7pt 8pt"><u>Cancellation of the Company&#x2019;s Series A Preferred Stock</u>.</p><br/><p style="font-size: 10pt; margin: 6pt 0.75pt 8pt">On August 31, 2015, the Company filed the Termination Certificate for Series A Convertible Preferred Stock (the &#x201c;Termination Certificate&#x201d;) with the Delaware Secretary of State. After the cancellation of the Series A Convertible Preferred Stock pursuant to the Unit Exchange described in Item 3.02 above, there were no shares of Series A Convertible Preferred Stock outstanding. The Termination Certificate removed the Series A Convertible Preferred Stock from the Company&#x2019;s authorized share capital, rendered the Certificate of Designation of Preferences, Rights and Limitations of Series A Convertible Preferred Stock (the &#x201c;Series A Certificate of Designation&#x201d;) null and void and eliminated all matters set forth in the Series A Certificate of Designation with respect to the Series A Convertible Preferred Stock from the Certificate of Incorporation of the Company. Pursuant to the Termination Certificate, the authorized shares of Series A Convertible Preferred Stock in the Series A Certificate of Designation resumed the status of authorized but unissued and undesignated shares of preferred stock of the Company.</p><br/><p style="font-size: 10pt; margin: 6pt 0.75pt 8pt"><u>Redemption of Convertible Notes</u></p><br/><p style="font-size: 10pt; margin: 6pt 0.75pt 8pt">In connection with the closing of the Offering, $933,074 aggregate principal amount of Convertible Notes plus interest and a 40% redeemable premium were redeemed for total payments of $1,548,792. See Note 4. Of this amount, approximately $167,031 was paid to its affiliates in redemption of their Convertible Notes.</p><br/><p style="font-size: 10pt; margin: 6pt 0.75pt 8pt"><u>Other Events</u></p><br/><p style="font-size: 10pt; margin: 6pt 0.7pt 8pt">As a result of the consummation of the Offering and the Unit Exchange on August 31, 2015, the Company issued a total of 1,895,010 Units (1,666,667 Units sold in the Offering and 228,343 Exchange Units issued in the Unit Exchange), comprised of a total of aggregate of 1,895,010 shares of Common Stock, 1,895,010 shares of Series B Preferred Stock and 7,580,040 Series A Warrants.</p><br/><p style="font-size: 10pt; margin: 6pt 0.75pt 8pt">As of such date, the Underwriter had the right to purchase an additional 250,000 Units pursuant to its overallotment option under the Underwriting Agreement and 83,333 Units pursuant to the Unit Purchase Option.</p><br/><p style="font-size: 10pt; margin: 0"><i>Accounting for share-based payment</i></p><br/><p style="font-size: 10pt; margin: 0">The Company has adopted ASC 718- Compensation-Stock Compensation ("ASC 718"). Under ASC 718 stock-based employee compensation cost is recognized using the fair value based method for all new awards granted after January 1, 2006 and unvested awards outstanding at January 1, 2006. Compensation costs for unvested stock options and non-vested awards that were outstanding at January 1, 2006, 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.</p><br/><p style="font-size: 10pt; margin: 0">ASC 718 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.</p><br/><p style="font-size: 10pt; margin: 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 2 to 7 years of 15 small-cap medical companies traded on major exchanges and 10 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.</p><br/><p style="font-size: 10pt; margin: 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.</p><br/><p style="font-size: 10pt; margin: 0">Since the Company has limited trading history in its stock and no first-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.</p><br/><p style="font-size: 10pt; margin: 0"><i>Valuation and accounting for options and warrants</i></p><br/><p style="font-size: 10pt; margin: 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.</p><br/><p style="font-size: 10pt; margin: 0">In January 2014 the Company issued 4,336 shares of common stock to the former CEO at $1.25 per share upon his exercising options.</p><br/><p style="font-size: 10pt; margin: 0">In January through March 2014, 9 warrant holders exercised warrants through a cashless exercise for a total of 15,442 shares of common stock.</p><br/><p style="font-size: 10pt; margin: 0">In January and February 2014 the Company issued warrants to purchase 21,538 shares pursuant to a February 4, 2014 private placement whereby the Company issued 20,550 shares of Series A Convertible Preferred Stock raising gross proceeds of $2,055,000. The warrants are at an exercise price of $24.38.</p><br/><p style="font-size: 10pt; margin: 0">In February 2014 the Company issued a warrant to purchase 1,482 shares of common stock at an exercise price of $20.25 to a major shareholder Dr. Samuel Herschkowitz. The warrant is in consideration for a bridge loan extended in December 2013 that has been paid in February 2014.</p><br/><p style="font-size: 10pt; margin: 0">On March 31, 2014, the Company issued dividends to the Purchasers of the Preferred Shares as described above. The dividends are at an annual rate of 6% of the stated value of the Preferred Shares paid on a quarterly basis in the form of common stock per a stipulated $19.50 per share. As a result 970 shares of common stock were issued to 16 holders of Preferred Shares.</p><br/><p style="font-size: 10pt; margin: 0">In March 2014, the Company issued 4,444 shares of common stock to a warrant holder for a partial cash exercise at $11.25 per share; issued 3,333 shares to the holder via the cashless exercise of the remainder of the warrant.</p><br/><p style="font-size: 10pt; margin: 0">In June 2014, the Company issued 3,725 shares of common stock to a warrant holder exercising cashless warrants.</p><br/><p style="font-size: 10pt; margin: 0">On June 30, 2014, the Company issued dividends to the Purchasers of the Preferred Shares as described above. The dividends are at an annual rate of 6% of the stated value of the Preferred Shares paid on a quarterly basis in the form of common stock per a stipulated $19.50 per share. As a result 1,561 shares of common stock were issued to 16 holders of Preferred Shares.</p><br/><p style="font-size: 10pt; margin: 0">On June 30, 2014, the Company issued a warrant to purchase 5,431 shares of common stock at an exercise price of $12.38 to SOK Partners, LLC, in consideration for a bridge loan in the form of convertible notes. On September 9, 2014 the Resale Registration Statement went into effect. The convertible note agreement provided an immediate approximately 11% reduction to the warrant agreement. Therefore, the warrant has been adjusted to purchase 4,831 shares of common stock at an exercise price of $12.38 to SOK Partners, LLC in consideration for a bridge loan.</p><br/><p style="font-size: 10pt; margin: 0">In July 2014, the Company issued warrants to purchase 28,986 shares of common stock at an exercise price of $12.38 to two lenders in consideration for a bridge loan in the form of convertible notes. The shares above reflect approximately an 11% reduction resulting from the Resale Registration Statement that went effective September 9, 2014.</p><br/><p style="font-size: 10pt; margin: 0">In August 2014, the Company issued warrants to purchase 61,539 of common stock at an exercise price of $24.38 to the Purchasers of the Preferred Shares. The Securities Purchase Agreement with the Preferred Shareholders stipulated that if the Company was not listed on either the NASDAQ Stock Market, the New York Stock Exchange or the NYSE MKT within 180 days of closing the agreement then warrants to purchase the above additional shares would be issued in aggregate to the Preferred Shareholders.</p><br/><p style="font-size: 10pt; margin: 0">In August and September 2014, the Company issued warrants to purchase 37,440 shares of common stock at an exercise price of $12.38 to four lenders in consideration for a bridge loan in the form of convertible notes. The shares above reflect the approximate 11% reduction resulting from the Resale Registration Statement that went effective September 9, 2014.</p><br/><p style="font-size: 10pt; margin: 0">On September 30, 2014, the Company issued dividends to the Purchasers of the Preferred Shares as described above. The dividends are at an annual rate of 6% of the stated value of the Preferred Shares paid on a quarterly basis in the form of common stock per a stipulated $19.50 per share. As a result 1,561 shares of common stock were issued to 16 holders of Preferred Shares.</p><br/><p style="font-size: 10pt; margin: 0">In November 2014, the Company issued 13,700 shares of common stock, par value $0.01, in escrow for debt settlement.</p><br/><p style="font-size: 10pt; margin: 0">On December 31, 2014, the Company issued dividends to the Purchasers of the Preferred Shares as described above. The dividends are at an annual rate of 6% of the stated value of the Preferred Shares paid on a quarterly basis in the form of common stock per a stipulated $19.50 per share. As a result 1,559 shares of common stock were issued to 16 holders of Preferred Shares.</p><br/><p style="font-size: 10pt; margin: 0">For grants of stock options and warrants in 2014 the Company used a 1.44% to 2.75% risk-free interest rate, 0% dividend rate, 59% to 66% volatility and estimated terms of 5 to 10 years. Value computed using these assumptions ranged from $3.2006 to $13.9195 per share.</p><br/><p style="font-size: 10pt; margin: 0">In January 2015, 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 $19.50 per share, but should have been calculated at $9.75 per share. As a result 3,122 shares of common stock were issued to 16 holders of Preferred Shares.</p><br/><p style="font-size: 10pt; margin: 0">On March 31, 2015, the Company issued dividends to the Purchasers of the Preferred Shares as described above. The dividends are at an annual rate of 6% of the stated value of the Preferred Shares paid on a quarterly basis in the form of common stock per a stipulated $9.75 per share. As a result 3,121 shares of common stock were issued to 16 holders of Preferred Shares.</p><br/><p style="font-size: 10pt; margin: 0">On June 30, 2015, the Company issued dividends to Purchases of the Preferred Shares as described above. The dividends are at an annual rate of 6% of the stated value of the Preferred Shares paid on a quarterly basis in the form of common stock per a stipulated $9.75 per share. As a result 3,121 shares of common stock were issued to 16 holders of Preferred Shares.</p><br/><p style="font-size: 10pt; margin: 0">For grants of stock options and warrants in 2015 the Company used a 1.63% to 2.35% risk-free interest rate, 0% dividend rate, 59% to 66% volatility and estimated terms of 5 to 10 years. Value computed using these assumptions ranged from $0.2750 to $5.5695 per share.</p><br/><p style="font-size: 10pt; margin: 0">The following summarizes transactions for stock options and warrants for the periods indicated:</p><br/><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; font-weight: bold">&nbsp;</td> <td colspan="7" style="font-size: 10pt; font-weight: bold; text-align: center">Stock Options</td> <td style="font-size: 10pt; font-weight: bold">&nbsp;</td> <td colspan="7" style="font-size: 10pt; font-weight: bold; text-align: center">Warrants</td> </tr> <tr style="vertical-align: bottom"> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid"><b>Number of<br /> Shares</b></td> <td style="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Average<br /> Exercise<br /> Price</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid"><b>Number&nbsp;of<br /> Shares</b></td> <td style="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Average<br /> Exercise<br /> Price</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 40%; font-size: 10pt">Outstanding at December 31, 2013</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 12%; font-size: 10pt; text-align: right">385,733</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">6.75</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 12%; font-size: 10pt; text-align: right">461,920</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">10.50</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt">Issued</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">75,683</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">8.12</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">161,375</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3.81</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt">Expired</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">(7,879</td> <td style="font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">23.58</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">(81,851</td> <td style="font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">13.54</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; padding-bottom: 1pt">Exercised</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(4,936</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1.76</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(40,722</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">8.38</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt">Outstanding at December 31, 2014</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">448,601</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">7.51</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">500,722</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">7.95</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt">Issued</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">73,158</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3.14</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">7,581,722 </td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">4.95</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt">Expired</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">(13,804</td> <td style="font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">13.71</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">(1,567</td> <td style="font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">14.04</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; padding-bottom: 1pt">Exercised</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">-</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">-</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">-</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">-</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; padding-bottom: 2.25pt">Outstanding at September 30, 2015</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">507,955</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">6.82</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">8,080,877 </td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">5.14</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> </tr> </table><br/><p style="font-size: 10pt; margin: 0pt 0">At September 30, 2015, 504,788 stock options are fully vested and currently exercisable with a weighted average exercise price of $6.20 and a weighted average remaining term of 6.16 years. At September 30, 2015, 500,837 warrants are fully vested and exercisable. Stock-based compensation recognized for the nine months ending September 2015 and September 2014 was $320,334 and $440,117, respectively. The Company has $38,065 of unrecognized compensation expense related to non-vested stock options that are expected to be recognized over a weighted average period of approximately 5 months.</p><br/><p style="font-size: 10pt; margin: 0">The following summarizes the status of options and warrants outstanding at September 30, 2015:</p><br/><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="font-size: 10pt; font-weight: bold; font-style: italic; text-align: left">&nbsp;</td> <td style="font-size: 10pt; font-weight: bold; font-style: italic; text-align: right"><font style="font-size: 10pt"><b><i>Range of Prices</i></b></font></td> <td style="font-size: 10pt; font-weight: bold; font-style: italic; text-align: left">&nbsp;</td> <td style="font-size: 10pt; font-weight: bold; font-style: italic">&nbsp;</td> <td style="font-size: 10pt; font-weight: bold; font-style: italic; text-align: left">&nbsp;</td> <td style="font-size: 10pt; font-weight: bold; font-style: italic; text-align: right"><font style="font-size: 10pt"><b><i>&nbsp;Shares </i></b></font></td> <td style="font-size: 10pt; font-weight: bold; font-style: italic; text-align: left">&nbsp;</td> <td style="font-size: 10pt; font-weight: bold; font-style: italic">&nbsp;</td> <td style="font-size: 10pt; font-weight: bold; font-style: italic; text-align: left">&nbsp;</td> <td style="font-size: 10pt; font-weight: bold; font-style: italic; text-align: right"><font style="font-size: 10pt"><b><i>&nbsp;Weighted Remaining Life </i></b></font></td> <td style="font-size: 10pt; font-weight: bold; font-style: italic; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: left"><font style="font-size: 10pt">Options</font></td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 31%; font-size: 10pt; text-align: right">0.75</td> <td style="width: 1%; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt; color: blue">&nbsp;</td> <td style="width: 1%; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="width: 31%; font-size: 10pt; text-align: right">7,333</td> <td style="width: 1%; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt; color: blue">&nbsp;</td> <td style="width: 1%; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="width: 30%; font-size: 10pt; text-align: right">5.77</td> <td style="width: 1%; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">3.10</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">59,681</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">9.76</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">3.21</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">6,232</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">10.00</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">3.45</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">7,245</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">9.51</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">4.875</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">134</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">7.45</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">5.25</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">2,031</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">6.94</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">5.625</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">192,000</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">7.46</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">5.925</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">23,206</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">7.47</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">6.00</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">123,998</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">6.88</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">6.50</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3,845</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">9.26</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">6.60</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">5,332</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">6.32</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">8.25</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3,636</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">9.01</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">9.9375</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3,019</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">7.79</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">10.50</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3,238</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">7.79</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">11.25</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">13,666</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">7.35</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">12.75</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">67</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">7.61</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">13.875</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">2,160</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">8.51</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">17.25</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">40,261</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">8.44</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">18.75</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3,334</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">8.40</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">20.25</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">4,940</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">8.26</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">21.75</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">1,336</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">8.02</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">23.85</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">1,260</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">8.01</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right; border-bottom: Black 1pt solid">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 2.25pt; font-size: 10pt; text-align: left">&nbsp;</td> <td style="padding-bottom: 2.25pt; font-size: 10pt; text-align: right">&nbsp;</td> <td style="padding-bottom: 2.25pt; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">507,955</td> <td style="padding-bottom: 2.25pt; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="padding-bottom: 2.25pt; font-size: 10pt; text-align: left">&nbsp;</td> <td style="padding-bottom: 2.25pt; font-size: 10pt; text-align: right">&nbsp;</td> <td style="padding-bottom: 2.25pt; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: left"><font style="font-size: 10pt">Warrants</font></td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">0.75</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">400</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">0.19</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">4.95</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">7,580,040 </td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">4.92</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">6.00</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">102,857</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">2.45</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">9.00</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">2,666</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">2.32</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">9.75</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">63,227</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3.85</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">11.25</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">203,801</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">2.27</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">12.375</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">71,257</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3.86</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">12.38</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">5,557</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">4.11</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">13.50</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">4,444</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">2.72</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">14.85</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">23,612</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">2.66</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">20.25</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">1,481</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3.38</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="padding-bottom: 1pt; font-size: 10pt; text-align: left">$</td> <td style="padding-bottom: 1pt; font-size: 10pt; text-align: right">24.375</td> <td style="padding-bottom: 1pt; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">21,535</td> <td style="padding-bottom: 1pt; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="padding-bottom: 1pt; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="padding-bottom: 1pt; font-size: 10pt; text-align: right">3.35</td> <td style="padding-bottom: 1pt; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 2.25pt; font-size: 10pt; text-align: left">&nbsp;</td> <td style="padding-bottom: 2.25pt; font-size: 10pt; text-align: right">&nbsp;</td> <td style="padding-bottom: 2.25pt; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">8,080,877 </td> <td style="padding-bottom: 2.25pt; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="padding-bottom: 2.25pt; font-size: 10pt; text-align: left">&nbsp;</td> <td style="padding-bottom: 2.25pt; font-size: 10pt; text-align: right">&nbsp;</td> <td style="padding-bottom: 2.25pt; font-size: 10pt; text-align: left">&nbsp;</td> </tr> </table><br/><p style="font-size: 10pt; margin: 0">Stock options and warrants expire on various dates from December 2015 to September 2025.</p><br/><p style="font-size: 10pt; margin: 0">The shareholders approved an increase in authorized shares to 1,066,067 shares in an annual shareholder meeting held on June 22, 2010 and approved an increase in authorized shares to 2,666,667 shares in a special shareholder meeting held on September 7, 2011.</p><br/><p style="font-size: 10pt; margin: 0">The shareholders approved an increase in authorized shares to 4,000,000 shares in a special shareholder meeting held on January 15, 2013.</p><br/><p style="font-size: 10pt; margin: 0">The shareholders approved an amendment of the Company&#x2019;s 2012 Stock Incentive Plan to increase the reserve of shares authorized for issuance to 666,667 shares and to increase the threshold of limitation on certain grants to 266,667 shares on April 15, 2013.</p><br/><p style="font-size: 10pt; margin: 0">An increase from 4,000,000 to 10,666,667 authorized shares, and an amendment of the Company&#x2019;s 2012 Stock Incentive Plan to increase the reserve of shares authorized for issuance to 1,333,334 shares was approved at the September 10, 2013 annual meeting.</p><br/><p style="font-size: 10pt; margin: 0">On July 24, 2015, an amendment to the Certificate of Incorporation became effective, pursuant to which the authorized common stock was to 100,000,000 shares of common stock and the authorized preferred stock was increased to 20,000,000 shares.</p><br/><p style="font-size: 10pt; margin: 0"><b>Stock Options and Warrants Granted by the Company</b></p><br/><p style="font-size: 10pt; margin: 0">The following table is the listing of stock options and warrants as of September 30, 2015 by year of grant:</p><br/><p style="font-size: 10pt; margin: 0"><font style="font-size: 10pt">Stock Options:</font></p><br/><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="font-size: 10pt; padding-bottom: 1pt; text-align: left">Year</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Shares</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="5" style="font-size: 10pt; 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: 70%; font-size: 10pt; text-align: left">2011</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 12%; font-size: 10pt; text-align: right">11,666</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left"></td> <td style="width: 4%; font-size: 10pt; text-align: center">&nbsp;</td> <td style="width: 4%; font-size: 10pt; text-align: center">$0.75</td> <td style="width: 4%; font-size: 10pt; text-align: center">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">2012</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">126,029</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right"><font style="font-size: 10pt">5.25 </font></td> <td style="font-size: 10pt; text-align: center">&#x2013;<font style="font-size: 10pt"> </font></td> <td style="font-size: 10pt; text-align: left"><font style="font-size: 10pt">6.00</font></td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">2013</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">238,088</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right"><font style="font-size: 10pt">4.875 </font></td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">&#x2013; </font></td> <td style="font-size: 10pt; text-align: left"><font style="font-size: 10pt">25.613</font></td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">2014</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">59,013</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right"><font style="font-size: 10pt">6.50 </font></td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">&#x2013; </font></td> <td style="font-size: 10pt; text-align: left"><font style="font-size: 10pt">18.75</font></td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left; padding-bottom: 1pt">2015</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">73,158</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right"><font style="font-size: 10pt">3.10 </font></td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: center">&#x2013;<font style="font-size: 10pt"> </font></td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left"><font style="font-size: 10pt">3.45</font></td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; padding-bottom: 2.25pt; text-align: left">Total</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">507,955</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">$ <font style="font-size: 10pt">.75 </font></td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: center">&#x2013;<font style="font-size: 10pt"> </font></td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left"><font style="font-size: 10pt">25.613</font></td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> </tr> </table><br/><p style="font-size: 10pt; margin: 0"><font style="font-size: 10pt">Warrants:</font></p><br/><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="font-size: 10pt; text-align: left; padding-bottom: 1pt">Year</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Shares</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="5" style="font-size: 10pt; 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: 70%; font-size: 10pt; text-align: left">2010</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 12%; font-size: 10pt; text-align: right">400</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 4%; font-size: 10pt; text-align: center">&nbsp;</td> <td style="width: 4%; font-size: 10pt; text-align: center">0.75</td> <td style="width: 4%; font-size: 10pt; text-align: center">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">2011</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: center">&#x2013;</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">2012</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">69,801</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: center">11.25</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">2013</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">267,579</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right"><font style="font-size: 10pt">6.00 </font></td> <td style="font-size: 10pt; text-align: center">&#x2013;<font style="font-size: 10pt"> </font></td> <td style="font-size: 10pt; text-align: left"><font style="font-size: 10pt">14.85</font></td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">2014</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">161,375</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right"><font style="font-size: 10pt">12.375 </font></td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">&#x2013; </font></td> <td style="font-size: 10pt; text-align: left"><font style="font-size: 10pt">24.375</font></td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left; padding-bottom: 1pt">2015</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">7,581,722 </td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left"></td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">$4.95</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: center">&#x2013;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">9.75</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left; padding-bottom: 2.25pt">Total</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">8,080,877 </td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">$<font style="font-size: 10pt">0.75 </font></td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: center">&#x2013;<font style="font-size: 10pt"> </font></td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left"><font style="font-size: 10pt">24.375</font></td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> </tr> </table><br/> P3Y P3Y P10Y 1666667 9.00 8.28 0.72 0.0800 13800000 P45D 250000 0 0.01 70000 1 0.01 1 4 P6M 2.00 P20D P15D P30D 1 4.95 2 0.43 1 0.55 4.95 1.35 P5Y 0.43 7580040 0.43 4.326 76300000 0.0499 P3Y 0.05 83333 1.25 11.25 0.01 100 84770 228343 1 P6M 0.50 0.50 0.50 0.50 0.0499 0 933074 0.40 1548792 167031 1895010 1666667 228343 1895010 1895010 7580040 250000 83333 4336 1.25 15442 21538 20550 2055000 24.38 1482 20.25 0.06 19.50 970 16 4444 11.25 3333 3725 0.06 19.50 1561 16 5431 12.38 0.11 4831 12.38 28986 12.38 0.11 61539 24.38 P180D 37440 12.38 0.11 0.06 19.50 1561 16 13700 0.01 0.06 19.50 1559 16 0.0144 0.0275 0.00 0.59 0.66 P5Y P10Y 3.2006 13.9195 19.50 9.75 3122 16 0.06 9.75 3121 16 0.06 9.75 3121 16 0.0163 0.0235 0.00 0.59 0.66 P5Y P10Y 0.2750 5.5695 504788 6.20 P6Y58D 500837 320334 440117 38065 P5M 1066067 2666667 4000000 666667 266667 4000000 10666667 1333334 100000000 20000000 <table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; font-weight: bold">&nbsp;</td> <td colspan="7" style="font-size: 10pt; font-weight: bold; text-align: center">Stock Options</td> <td style="font-size: 10pt; font-weight: bold">&nbsp;</td> <td colspan="7" style="font-size: 10pt; font-weight: bold; text-align: center">Warrants</td> </tr> <tr style="vertical-align: bottom"> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid"><b>Number of<br /> Shares</b></td> <td style="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Average<br /> Exercise<br /> Price</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid"><b>Number&nbsp;of<br /> Shares</b></td> <td style="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Average<br /> Exercise<br /> Price</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 40%; font-size: 10pt">Outstanding at December 31, 2013</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 12%; font-size: 10pt; text-align: right">385,733</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">6.75</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 12%; font-size: 10pt; text-align: right">461,920</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">10.50</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt">Issued</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">75,683</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">8.12</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">161,375</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3.81</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt">Expired</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">(7,879</td> <td style="font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">23.58</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">(81,851</td> <td style="font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">13.54</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; padding-bottom: 1pt">Exercised</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(4,936</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1.76</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(40,722</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">8.38</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt">Outstanding at December 31, 2014</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">448,601</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">7.51</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">500,722</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">7.95</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt">Issued</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">73,158</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3.14</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">7,581,722 </td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">4.95</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt">Expired</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">(13,804</td> <td style="font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">13.71</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">(1,567</td> <td style="font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">14.04</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; padding-bottom: 1pt">Exercised</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">-</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">-</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">-</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">-</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; padding-bottom: 2.25pt">Outstanding at September 30, 2015</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">507,955</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">6.82</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">8,080,877 </td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">5.14</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> </tr> </table> 385733 6.75 461920 10.50 75683 8.12 161375 3.81 -7879 23.58 -81851 13.54 -4936 1.76 -40722 8.38 448601 7.51 500722 7.95 73158 3.14 7581722 4.95 -13804 13.71 -1567 14.04 507955 6.82 8080877 5.14 <table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="font-size: 10pt; font-weight: bold; font-style: italic; text-align: left">&nbsp;</td> <td style="font-size: 10pt; font-weight: bold; font-style: italic; text-align: right"><font style="font-size: 10pt"><b><i>Range of Prices</i></b></font></td> <td style="font-size: 10pt; font-weight: bold; font-style: italic; text-align: left">&nbsp;</td> <td style="font-size: 10pt; font-weight: bold; font-style: italic">&nbsp;</td> <td style="font-size: 10pt; font-weight: bold; font-style: italic; text-align: left">&nbsp;</td> <td style="font-size: 10pt; font-weight: bold; font-style: italic; text-align: right"><font style="font-size: 10pt"><b><i>&nbsp;Shares </i></b></font></td> <td style="font-size: 10pt; font-weight: bold; font-style: italic; text-align: left">&nbsp;</td> <td style="font-size: 10pt; font-weight: bold; font-style: italic">&nbsp;</td> <td style="font-size: 10pt; font-weight: bold; font-style: italic; text-align: left">&nbsp;</td> <td style="font-size: 10pt; font-weight: bold; font-style: italic; text-align: right"><font style="font-size: 10pt"><b><i>&nbsp;Weighted Remaining Life </i></b></font></td> <td style="font-size: 10pt; font-weight: bold; font-style: italic; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: left"><font style="font-size: 10pt">Options</font></td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 31%; font-size: 10pt; text-align: right">0.75</td> <td style="width: 1%; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt; color: blue">&nbsp;</td> <td style="width: 1%; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="width: 31%; font-size: 10pt; text-align: right">7,333</td> <td style="width: 1%; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt; color: blue">&nbsp;</td> <td style="width: 1%; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="width: 30%; font-size: 10pt; text-align: right">5.77</td> <td style="width: 1%; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">3.10</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">59,681</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">9.76</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">3.21</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">6,232</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">10.00</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">3.45</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">7,245</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">9.51</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">4.875</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">134</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">7.45</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">5.25</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">2,031</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">6.94</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">5.625</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">192,000</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">7.46</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">5.925</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">23,206</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">7.47</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">6.00</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">123,998</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">6.88</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">6.50</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3,845</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">9.26</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">6.60</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">5,332</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">6.32</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">8.25</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3,636</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">9.01</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">9.9375</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3,019</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">7.79</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">10.50</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3,238</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">7.79</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">11.25</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">13,666</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">7.35</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">12.75</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">67</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">7.61</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">13.875</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">2,160</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">8.51</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">17.25</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">40,261</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">8.44</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">18.75</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3,334</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">8.40</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">20.25</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">4,940</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">8.26</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">21.75</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">1,336</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">8.02</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">23.85</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">1,260</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">8.01</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right; border-bottom: Black 1pt solid">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 2.25pt; font-size: 10pt; text-align: left">&nbsp;</td> <td style="padding-bottom: 2.25pt; font-size: 10pt; text-align: right">&nbsp;</td> <td style="padding-bottom: 2.25pt; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">507,955</td> <td style="padding-bottom: 2.25pt; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="padding-bottom: 2.25pt; font-size: 10pt; text-align: left">&nbsp;</td> <td style="padding-bottom: 2.25pt; font-size: 10pt; text-align: right">&nbsp;</td> <td style="padding-bottom: 2.25pt; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: left"><font style="font-size: 10pt">Warrants</font></td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">0.75</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">400</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">0.19</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">4.95</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">7,580,040 </td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">4.92</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">6.00</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">102,857</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">2.45</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">9.00</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">2,666</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">2.32</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">9.75</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">63,227</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3.85</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">11.25</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">203,801</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">2.27</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">12.375</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">71,257</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3.86</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">12.38</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">5,557</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">4.11</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">13.50</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">4,444</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">2.72</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">14.85</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">23,612</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">2.66</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">20.25</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">1,481</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; color: blue">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3.38</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="padding-bottom: 1pt; font-size: 10pt; text-align: left">$</td> <td style="padding-bottom: 1pt; font-size: 10pt; text-align: right">24.375</td> <td style="padding-bottom: 1pt; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">21,535</td> <td style="padding-bottom: 1pt; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="padding-bottom: 1pt; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="padding-bottom: 1pt; font-size: 10pt; text-align: right">3.35</td> <td style="padding-bottom: 1pt; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 2.25pt; font-size: 10pt; text-align: left">&nbsp;</td> <td style="padding-bottom: 2.25pt; font-size: 10pt; text-align: right">&nbsp;</td> <td style="padding-bottom: 2.25pt; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">8,080,877 </td> <td style="padding-bottom: 2.25pt; font-size: 10pt; color: blue; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="padding-bottom: 2.25pt; font-size: 10pt; text-align: left">&nbsp;</td> <td style="padding-bottom: 2.25pt; font-size: 10pt; text-align: right">&nbsp;</td> <td style="padding-bottom: 2.25pt; font-size: 10pt; text-align: left">&nbsp;</td> </tr> </table> 0.75 7333 P5Y281D 3.10 59681 P9Y277D 3.21 6232 P10Y 3.45 7245 P9Y186D 4.875 134 P7Y164D 5.25 2031 P6Y343D 5.625 192000 P7Y167D 5.925 23206 P7Y171D 6.00 123998 P6Y321D 6.50 3845 P9Y94D 6.60 5332 P6Y116D 8.25 3636 P9Y3D 9.9375 3019 P7Y288D 10.50 3238 P7Y288D 11.25 13666 P7Y127D 12.75 67 P7Y222D 13.875 2160 P8Y186D 17.25 40261 P8Y160D 18.75 3334 P8Y146D 20.25 4940 P8Y94D 21.75 1336 P8Y7D 23.85 1260 P8Y3D 507955 0.75 400 P69D 4.95 7580040 P4Y335D 6.00 102857 P2Y164D 9.00 2666 P2Y116D 9.75 63227 P3Y310D 11.25 203801 P2Y98D 12.375 71257 P3Y313D 12.38 5557 P4Y40D 13.50 4444 P2Y262D 14.85 23612 P2Y240D 20.25 1481 P3Y138D 24.375 21535 P3Y127D 8080877 <table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="font-size: 10pt; padding-bottom: 1pt; text-align: left">Year</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Shares</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="5" style="font-size: 10pt; 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: 70%; font-size: 10pt; text-align: left">2011</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 12%; font-size: 10pt; text-align: right">11,666</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left"></td> <td style="width: 4%; font-size: 10pt; text-align: center">&nbsp;</td> <td style="width: 4%; font-size: 10pt; text-align: center">$0.75</td> <td style="width: 4%; font-size: 10pt; text-align: center">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">2012</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">126,029</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right"><font style="font-size: 10pt">5.25 </font></td> <td style="font-size: 10pt; text-align: center">&#x2013;<font style="font-size: 10pt"> </font></td> <td style="font-size: 10pt; text-align: left"><font style="font-size: 10pt">6.00</font></td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">2013</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">238,088</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right"><font style="font-size: 10pt">4.875 </font></td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">&#x2013; </font></td> <td style="font-size: 10pt; text-align: left"><font style="font-size: 10pt">25.613</font></td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">2014</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">59,013</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right"><font style="font-size: 10pt">6.50 </font></td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">&#x2013; </font></td> <td style="font-size: 10pt; text-align: left"><font style="font-size: 10pt">18.75</font></td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left; padding-bottom: 1pt">2015</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">73,158</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right"><font style="font-size: 10pt">3.10 </font></td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: center">&#x2013;<font style="font-size: 10pt"> </font></td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left"><font style="font-size: 10pt">3.45</font></td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; padding-bottom: 2.25pt; text-align: left">Total</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">507,955</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">$ <font style="font-size: 10pt">.75 </font></td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: center">&#x2013;<font style="font-size: 10pt"> </font></td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left"><font style="font-size: 10pt">25.613</font></td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> </tr> </table><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="font-size: 10pt; text-align: left; padding-bottom: 1pt">Year</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Shares</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="5" style="font-size: 10pt; 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: 70%; font-size: 10pt; text-align: left">2010</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 12%; font-size: 10pt; text-align: right">400</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 4%; font-size: 10pt; text-align: center">&nbsp;</td> <td style="width: 4%; font-size: 10pt; text-align: center">0.75</td> <td style="width: 4%; font-size: 10pt; text-align: center">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">2011</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: center">&#x2013;</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">2012</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">69,801</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: center">11.25</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">2013</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">267,579</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right"><font style="font-size: 10pt">6.00 </font></td> <td style="font-size: 10pt; text-align: center">&#x2013;<font style="font-size: 10pt"> </font></td> <td style="font-size: 10pt; text-align: left"><font style="font-size: 10pt">14.85</font></td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">2014</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">161,375</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right"><font style="font-size: 10pt">12.375 </font></td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">&#x2013; </font></td> <td style="font-size: 10pt; text-align: left"><font style="font-size: 10pt">24.375</font></td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left; padding-bottom: 1pt">2015</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">7,581,722 </td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left"></td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">$4.95</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: center">&#x2013;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">9.75</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left; padding-bottom: 2.25pt">Total</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">8,080,877 </td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">$<font style="font-size: 10pt">0.75 </font></td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: center">&#x2013;<font style="font-size: 10pt"> </font></td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left"><font style="font-size: 10pt">24.375</font></td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> </tr> </table> 11666 0.75 126029 5.25 6.00 238088 4.875 25.613 59013 6.50 18.75 73158 3.10 3.45 0.75 25.613 400 0.75 69801 11.25 267579 6.00 14.85 161375 12.375 24.375 7581722 4.95 9.75 8080877 0.75 24.375 <p style="font-size: 10pt; margin: 0"><b>NOTE 4 &#x2013; SHORT-TERM NOTES PAYABLE</b></p><br/><p style="font-size: 10pt; margin: 0">From July through September 2014, we entered into a series of securities purchase agreements pursuant to which we issued approximately $1.8 million original principal amount (subsequently reduced to approximately $1.6 million aggregate principal amount in accordance with their terms) of convertible promissory notes (the &#x201c;2014 Convertible Notes&#x201d;) and warrants exercisable for shares of our common stock for an aggregate purchase price of $1,475,000. Of this amount, we issued to SOK Partners, LLC, an affiliate of the Company, $122,196 original principal amount of the 2014 Convertible Notes and warrants exercisable for 5,431 shares of our common stock for an aggregate purchase price of $100,000. In April and May 2015, we issued and sold to a private investor additional Convertible Notes in an aggregate original principal amount of $275,000 for an aggregate purchase price of $250,000, containing terms substantially similar to the 2014 Convertible Notes (the &#x201c;2015 Convertible Notes&#x201d; and, together with the 2014 Convertible Notes, the &#x201c;Convertible Notes&#x201d;). No warrants were issued with the 2015 Convertible Notes.</p><br/><p style="font-size: 10pt; margin: 0">Under a provision in the existing agreements, upon effectiveness of a resale registration statement covering certain shares, on September 9, 2014, the principal amount of the notes was reduced by 11%, to $1,603,260 and the number of Warrants was reduced by 11%, to 71,257 shares.</p><br/><p style="font-size: 10pt; margin: 0">As of June 30, 2015, $927,663 aggregate principal amount of Convertible Notes, plus accrued and unpaid interest thereto, have been converted into shares of our common stock and $933,073 aggregate principal amount of Convertible Notes remained outstanding.</p><br/><p style="font-size: 10pt; margin: 0 0 8pt; 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&#x2019;s common stock, in exchange for the Company&#x2019;s agreement to redeem all of the outstanding Convertible Notes promptly following the consummation of the Offering at a redemption price equal to 140% of the principal amount, plus accrued and unpaid interest to the redemption date. On August 31, 2015, the closing date of the offering, the Company redeemed the remaining $933,074 aggregate principal amount of Convertible Notes plus interest and a 40% redeemable premium, for a total payment of $1,548,792. Of this amount, approximately $167,031 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 September 30, 2015 none of the Convertible Notes were outstanding.</p><br/> 1800000 1600000 1475000 122196 5431 100000 275000 250000 0 0.11 1603260 0.11 71257 927663 933073 1.40 0 <p style="font-size: 10pt; margin: 0"><b>NOTE 5 - LOSS PER SHARE</b></p><br/><p style="font-size: 10pt; margin: 0">The following table presents the shares used in the basic and diluted loss per common share computations:</p><br/><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</td> <td colspan="7" style="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><p style="margin-top: 0; margin-bottom: 0">Three Months Ended</p> <p style="margin-top: 0; margin-bottom: 0">September 30,</p></td> <td style="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</td> <td colspan="7" style="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><p style="margin-top: 0; margin-bottom: 0">Nine Months Ended</p> <p style="margin-top: 0; margin-bottom: 0">September 30,</p></td> </tr> <tr style="vertical-align: bottom"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2015</td> <td style="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2014</td> <td style="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2015</td> <td style="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2014</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt">Numerator:</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="width: 40%; font-size: 10pt; text-align: left">Net loss available in basic and diluted calculation</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">(1,116,402</td> <td style="width: 1%; font-size: 10pt; text-align: left">)</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">(1,115,221</td> <td style="width: 1%; font-size: 10pt; text-align: left">)</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">(2,527,524</td> <td style="width: 1%; font-size: 10pt; text-align: left">)</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">(4,468,170</td> <td style="width: 1%; font-size: 10pt; text-align: left">)</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt">Denominator:</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt">Weighted average common shares outstanding-basic</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3,936,126 </td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">2,984,335</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3,435,700 </td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">2,967,483</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">Effect of diluted stock options and warrants (1)</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; padding-bottom: 1pt">Weighted average common shares outstanding-basic</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,936,126 </td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,984,335</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,435,700 </td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,967,483</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left; padding-bottom: 2.25pt">Loss per common share basic and diluted</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">(0.28</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">(0.37</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">(0.74</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">(1.51</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">)</td> </tr> </table><br/><p style="font-size: 10pt; margin: 0pt 0">(1) The number of shares underlying options and warrants outstanding as of September 30, 2015 and September 30, 2014 are 8,588,832 and 945,220 respectively. The number of underlying Series B preferred shares outstanding is 1,895,010. The effect of the shares that would be issued upon exercise of such options and warrants has been excluded from the calculation of diluted loss per share because those shares are anti-dilutive.</p><br/> 8588832 945220 1895010 <table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</td> <td colspan="7" style="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><p style="margin-top: 0; margin-bottom: 0">Three Months Ended</p> <p style="margin-top: 0; margin-bottom: 0">September 30,</p></td> <td style="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</td> <td colspan="7" style="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><p style="margin-top: 0; margin-bottom: 0">Nine Months Ended</p> <p style="margin-top: 0; margin-bottom: 0">September 30,</p></td> </tr> <tr style="vertical-align: bottom"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2015</td> <td style="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2014</td> <td style="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2015</td> <td style="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2014</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt">Numerator:</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="width: 40%; font-size: 10pt; text-align: left">Net loss available in basic and diluted calculation</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">(1,116,402</td> <td style="width: 1%; font-size: 10pt; text-align: left">)</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">(1,115,221</td> <td style="width: 1%; font-size: 10pt; text-align: left">)</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">(2,527,524</td> <td style="width: 1%; font-size: 10pt; text-align: left">)</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">(4,468,170</td> <td style="width: 1%; font-size: 10pt; text-align: left">)</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt">Denominator:</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt">Weighted average common shares outstanding-basic</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3,936,126 </td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">2,984,335</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3,435,700 </td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">2,967,483</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">Effect of diluted stock options and warrants (1)</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; padding-bottom: 1pt">Weighted average common shares outstanding-basic</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,936,126 </td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,984,335</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,435,700 </td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,967,483</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left; padding-bottom: 2.25pt">Loss per common share basic and diluted</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">(0.28</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">(0.37</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">(0.74</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">(1.51</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">)</td> </tr> </table> 3936126 2984335 3435700 2967483 <p style="font-size: 10pt; margin: 0"><b>NOTE 6 &#x2013; INCOME TAXES</b></p><br/><p style="font-size: 10pt; margin: 0">The provision for income taxes consists of an amount for taxes currently payable and a provision for tax consequences deferred to future periods.&nbsp; 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.&nbsp; 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.</p><br/><p style="font-size: 10pt; margin: 0">There is no income tax provision in the accompanying statements of operations due to the cumulative operating losses that indicate a 100% valuation allowance for the deferred tax assets and state income taxes is appropriate.</p><br/><p style="font-size: 10pt; margin: 0">During September 2013, the Company experienced an "ownership change" as defined in Section 382 of the Internal Revenue Code which could potentially limit the ability to utilize the Company&#x2019;s net operating losses (NOLs). 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&#x2019;s value immediately before the ownership change.</p><br/><p style="font-size: 10pt; margin: 0">At September 30, 2015, the Company had approximately $22.3 million of gross NOLs to reduce future federal taxable income, the majority of which are expected to be available for use in 2016, subject to the Section 382 limitation described above. The federal NOLs will expire beginning in 2022 if unused. The Company also had approximately $12.5 million of gross NOLs to reduce future state taxable income at September 30, 2015, which will expire in years 2022 through 2034 if unused. The Company's net deferred tax assets, which include the NOLs, are subject to a full valuation allowance. At September 30, 2015, the federal and state valuation allowances were $9.5 million and $0.4 million, respectively.</p><br/><p style="font-size: 10pt; margin: 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.</p><br/><p style="font-size: 10pt; margin: 0">The components of deferred income taxes at September 30, 2015 and December 31, 2014 are as follows:</p><br/><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">September&nbsp;30,<br /> 2015</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">December&nbsp;31,<br /> 2014</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">Deferred Tax Asset:</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 70%; font-size: 10pt; text-align: left">Net Operating Loss</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">9,307,000</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">7,919,000</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; padding-bottom: 1pt">Other</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">628,000</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,150,000</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">Total Deferred Tax Asset</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">9,935,000</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">9,069,000</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left; padding-bottom: 1pt">Less Valuation Allowance</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">9,935,000</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">9,069,000</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left; padding-bottom: 2.25pt">Net Deferred Income Taxes</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">&#x2014;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">&#x2014;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> </tr> </table><br/> 1.00 22300000 12500000 9500000 400000 <table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">September&nbsp;30,<br /> 2015</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">December&nbsp;31,<br /> 2014</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">Deferred Tax Asset:</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 70%; font-size: 10pt; text-align: left">Net Operating Loss</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">9,307,000</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">7,919,000</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; padding-bottom: 1pt">Other</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">628,000</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,150,000</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">Total Deferred Tax Asset</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">9,935,000</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">9,069,000</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left; padding-bottom: 1pt">Less Valuation Allowance</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">9,935,000</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">9,069,000</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left; padding-bottom: 2.25pt">Net Deferred Income Taxes</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">&#x2014;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 2.25pt">&nbsp;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: right">&#x2014;</td> <td style="border-bottom: Black 2.25pt double; font-size: 10pt; text-align: left">&nbsp;</td> </tr> </table> 9307000 7919000 628000 1150000 9935000 9069000 9935000 9069000 0 0 <p style="font-size: 10pt; margin: 0"><b>NOTE 7 &#x2013; RENT OBLIGATION</b></p><br/><p style="font-size: 10pt; margin: 0">The Company leases its principal office under a lease that can be cancelled after three years with proper notice per the lease and an amortized schedule of adjustments that will be due to the landlord. The lease extends five years and expires January 2018. In addition to rent, the Company pays real estate taxes and repairs and maintenance on the leased property. Rent expense was $15,900 and $50,156 for the three and nine months ended September 30, 2015 and was $15,719 and $46,321 for the three and nine months ended September 30, 2014 respectively.</p><br/><p style="font-size: 10pt; margin: 0">The Company&#x2019;s rent obligation for the next five years is as follows:</p><br/><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 85%; font-size: 10pt; text-align: left">2015</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">9,250</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">2016</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">38,000</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">2017</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">39,000</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">2018</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">3,600</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">2019</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> </table><br/> P3Y P5Y 15900 50156 15719 46321 P5Y <table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 85%; font-size: 10pt; text-align: left">2015</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 12%; font-size: 10pt; text-align: right">9,250</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">2016</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">38,000</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">2017</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">39,000</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">2018</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">3,600</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">2019</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">$</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> </table> 9250 38000 39000 3600 <p style="font-size: 10pt; margin: 0"><b>NOTE 8 &#x2013; LIABILITY FOR EQUITY-LINKED FINANCIAL INSTRUMENTS</b></p><br/><p style="font-size: 10pt; margin: 0">The Company adopted ASC 815- Derivatives and Hedging (&#x201c;ASC 815&#x201d;) on January 1, 2009. ASC 815 mandates a two-step process for evaluating whether an equity-linked financial instrument or embedded feature is indexed to the entity's own stock. It was effective for fiscal years beginning after December 15, 2008, and interim periods within those fiscal years, which was the Company's first quarter of 2009. Many of the warrants issued by the Company contain a strike price adjustment feature, which upon adoption of ASC 815, changed the classification (from equity to liability) and the related accounting for warrants with a $479,910 estimated fair value of as of January 1, 2009. An adjustment was made to remove $486,564 from paid-in capital (the cumulative values of the warrants on their grant dates), a positive adjustment of $6,654 was made to accumulated deficit, representing the gain on valuation from the grant date to January 1, 2009, and $479,910 was booked as a liability. The warrants issued in 2011 do not contain a strike price adjustment feature and, therefore, are not treated as a liability.</p><br/><p style="font-size: 10pt; margin: 0">The January 1, 2009 valuation was computed using the Black-Scholes valuation model based upon a 2.5-year expected term, an expected volatility of 63%, an exercise price of $34.50 per share, a stock price of $26.25, a zero dividend rate and a 1.37% risk free interest rate. Subsequent to January 1, 2009 these warrants were re-valued at the end of each quarter and a gain or loss was recorded based upon their increase or decrease in value during the quarter. Likewise, new warrants that were issued during 2009 and 2010&nbsp;were valued, using the Black-Scholes valuation model on their date of grant and an entry was made to reduce paid-in capital and increase the liability for equity-linked financial instruments. These warrants were also re-valued at the end of each quarter based upon their expected life, the stock price, the exercise price, assumed dividend rate, expected volatility and risk free interest rate. A significant reduction in the liability was realized in 2010 primarily due to a reduction from $37.50 to $16.50 per share in the underlying stock price. The Company realized a slight increase in the liability for existing warrants during the first quarter of 2012. In 2013 there was a significant decrease in the liability primarily due to current expirations and the amount of warrants reaching expiration in the near term. In 2014, all warrants expired and the liability was reduced to zero.</p><br/><p style="font-size: 10pt; margin: 0">The inputs to the Black-Scholes model during 2009 through 2014 were as follows:</p><br/><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt">Stock price</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">$3.75</font></td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">to </font></td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">$37.50</font></td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt">Exercise price</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">$ .75</font></td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">to </font></td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">$25.613</font></td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">Expected life (years)</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">2.0 </font></td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">to </font></td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">6.5 </font></td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">Expected volatility</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: center">59%</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: left"></td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">Assumed dividend rate</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">- %</font></td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left; width: 85%">Risk-free interest rate</td> <td style="font-size: 10pt; width: 1%">&nbsp;</td> <td style="font-size: 10pt; text-align: left; width: 1%">&nbsp;</td> <td style="font-size: 10pt; text-align: center; width: 4%"><font style="font-size: 10pt">.13% </font></td> <td style="font-size: 10pt; text-align: center; width: 4%"><font style="font-size: 10pt">to </font></td> <td style="font-size: 10pt; text-align: center; width: 4%"><font style="font-size: 10pt">2.97%</font></td> <td style="font-size: 10pt; text-align: left; width: 1%">&nbsp;</td> </tr> </table><br/><p style="font-size: 10pt; margin: 0">The original valuations, annual gain/(loss) and end of year valuations are shown below:</p><br/><table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="font-size: 10pt; text-align: left; padding-bottom: 1pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Initial&nbsp;Value</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Annual Gain&nbsp;(Loss)</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Value at 12/31/09</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2010 Gain (Loss)</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Value at 12/31/10</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2011 Gain (Loss)</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Value at 12/31/2011</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2012 Gain (Loss)</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Value at12/31/2012</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2013 Gain (Loss)</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Value at12/31/2013</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2014 Gain (Loss)</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Value at 12/31/2014</td> </tr> <tr style="vertical-align: bottom"> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 48%; font-size: 10pt; text-align: left">January 1, 2009 adoption</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">479,910</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">(390,368</td> <td style="width: 1%; font-size: 10pt; text-align: left">)</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">870,278</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">868,772</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">1,506</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">(88,290</td> <td style="width: 1%; font-size: 10pt; text-align: left">)</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">89,796</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">(21,856</td> <td style="width: 1%; font-size: 10pt; text-align: left">)</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">111,652</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">100,053</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">11,599</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">11,599</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">-</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td nowrap="nowrap" style="font-size: 10pt; text-align: left">Warrants issued in quarter ended 6/30/2009</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">169,854</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">20,847</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">149,007</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">147,403</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">1,604</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">(4,689</td> <td style="font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">6,293</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">6,293</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">Warrants issued in quarter ended 9/30/2009</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">39,743</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">(738</td> <td style="font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">40,481</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">40,419</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">62</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">(1,562</td> <td style="font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">1,624</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">910</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">714</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">714</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">Warrants issued in quarter ended 12/31/2009</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left; border-bottom: Black 1pt solid">&nbsp;</td> <td style="font-size: 10pt; text-align: right; border-bottom: Black 1pt solid">12,698</td> <td style="font-size: 10pt; text-align: left; border-bottom: Black 1pt solid">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">617</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left; border-bottom: Black 1pt solid">&nbsp;</td> <td style="font-size: 10pt; text-align: right; border-bottom: Black 1pt solid">12,081</td> <td style="font-size: 10pt; text-align: left; border-bottom: Black 1pt solid">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">12,053</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">28</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">(724</td> <td style="font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">752</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">415</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">337</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">337</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left; text-indent: 20pt">Subtotal</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">702,205</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">1,071,847</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">Warrants issued in quarter ended 3/31/2010</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">25,553</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">25,014</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">539</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">(5,570</td> <td style="font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">6,109</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3,701</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">2,408</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">2,408</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">Warrants issued in quarter ended 6/30/2010</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">31,332</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">30,740</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">592</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">(6,122</td> <td style="font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">6,714</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">6,083</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">631</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">631</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left; padding-bottom: 1pt">Warrants issued in quarter ended 9/30/2010</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">31,506</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">20,891</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">10,615</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(44,160</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">54,775</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,338</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">53,437</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">53,437</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">-</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">-</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">-</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left; padding-bottom: 2.5pt; text-indent: 20pt">Total</td> <td style="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">790,596</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 2.5pt double">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">(369,642</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt; border-bottom: Black 2.5pt double">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">1,071,847</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 2.5pt double">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">1,145,292</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 2.5pt double">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">14,946</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 2.5pt double">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">(151,117</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt; border-bottom: Black 2.5pt double">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">166,063</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 2.5pt double">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">(3,116</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt; border-bottom: Black 2.5pt double">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">169,179</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 2.5pt double">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">157,580</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 2.5pt double">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">11,599</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 2.5pt double">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">11,599</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 2.5pt double">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">-</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</td> </tr> </table><br/> 479910 486564 6654 479910 P2Y6M 0.63 34.50 26.25 0.00 0.0137 37.50 16.50 0 <table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt">Stock price</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">$3.75</font></td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">to </font></td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">$37.50</font></td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt">Exercise price</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">$ .75</font></td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">to </font></td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">$25.613</font></td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">Expected life (years)</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">2.0 </font></td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">to </font></td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">6.5 </font></td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">Expected volatility</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: center">59%</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: left"></td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">Assumed dividend rate</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: center"><font style="font-size: 10pt">- %</font></td> <td style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left; width: 85%">Risk-free interest rate</td> <td style="font-size: 10pt; width: 1%">&nbsp;</td> <td style="font-size: 10pt; text-align: left; width: 1%">&nbsp;</td> <td style="font-size: 10pt; text-align: center; width: 4%"><font style="font-size: 10pt">.13% </font></td> <td style="font-size: 10pt; text-align: center; width: 4%"><font style="font-size: 10pt">to </font></td> <td style="font-size: 10pt; text-align: center; width: 4%"><font style="font-size: 10pt">2.97%</font></td> <td style="font-size: 10pt; text-align: left; width: 1%">&nbsp;</td> </tr> </table> 3.75 37.50 0.75 25.613 P2Y P6Y6M 0.59 0.0013 0.0297 <table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="font-size: 10pt; text-align: left; padding-bottom: 1pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Initial&nbsp;Value</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Annual Gain&nbsp;(Loss)</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Value at 12/31/09</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2010 Gain (Loss)</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Value at 12/31/10</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2011 Gain (Loss)</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Value at 12/31/2011</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2012 Gain (Loss)</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Value at12/31/2012</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2013 Gain (Loss)</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Value at12/31/2013</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2014 Gain (Loss)</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Value at 12/31/2014</td> </tr> <tr style="vertical-align: bottom"> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt; text-align: center">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td colspan="3" style="font-size: 10pt">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 48%; font-size: 10pt; text-align: left">January 1, 2009 adoption</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">479,910</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">(390,368</td> <td style="width: 1%; font-size: 10pt; text-align: left">)</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">870,278</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">868,772</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">1,506</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">(88,290</td> <td style="width: 1%; font-size: 10pt; text-align: left">)</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">89,796</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">(21,856</td> <td style="width: 1%; font-size: 10pt; text-align: left">)</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">111,652</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">100,053</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">11,599</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">11,599</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> <td style="width: 1%; font-size: 10pt">&nbsp;</td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td> <td style="width: 1%; font-size: 10pt; text-align: right">-</td> <td style="width: 1%; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td nowrap="nowrap" style="font-size: 10pt; text-align: left">Warrants issued in quarter ended 6/30/2009</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">169,854</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">20,847</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">149,007</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">147,403</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">1,604</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">(4,689</td> <td style="font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">6,293</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">6,293</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">Warrants issued in quarter ended 9/30/2009</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">39,743</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">(738</td> <td style="font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">40,481</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">40,419</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">62</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">(1,562</td> <td style="font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">1,624</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">910</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">714</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">714</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">Warrants issued in quarter ended 12/31/2009</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left; border-bottom: Black 1pt solid">&nbsp;</td> <td style="font-size: 10pt; text-align: right; border-bottom: Black 1pt solid">12,698</td> <td style="font-size: 10pt; text-align: left; border-bottom: Black 1pt solid">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">617</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left; border-bottom: Black 1pt solid">&nbsp;</td> <td style="font-size: 10pt; text-align: right; border-bottom: Black 1pt solid">12,081</td> <td style="font-size: 10pt; text-align: left; border-bottom: Black 1pt solid">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">12,053</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">28</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">(724</td> <td style="font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">752</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">415</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">337</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">337</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left; text-indent: 20pt">Subtotal</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">702,205</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">1,071,847</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left">Warrants issued in quarter ended 3/31/2010</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">25,553</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">25,014</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">539</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">(5,570</td> <td style="font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">6,109</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">3,701</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">2,408</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">2,408</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left">Warrants issued in quarter ended 6/30/2010</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">31,332</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">30,740</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">592</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">(6,122</td> <td style="font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">6,714</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">6,083</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">631</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">631</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt">&nbsp;</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; text-align: right">-</td> <td style="font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left; padding-bottom: 1pt">Warrants issued in quarter ended 9/30/2010</td> <td style="font-size: 10pt; padding-bottom: 1pt">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">31,506</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">20,891</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">10,615</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(44,160</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">54,775</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,338</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">53,437</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">53,437</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">-</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">-</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">-</td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-size: 10pt; text-align: left; padding-bottom: 2.5pt; text-indent: 20pt">Total</td> <td style="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">790,596</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 2.5pt double">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">(369,642</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt; border-bottom: Black 2.5pt double">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">1,071,847</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 2.5pt double">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">1,145,292</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 2.5pt double">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">14,946</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 2.5pt double">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">(151,117</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt; border-bottom: Black 2.5pt double">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">166,063</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 2.5pt double">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">(3,116</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">)</td> <td style="font-size: 10pt; border-bottom: Black 2.5pt double">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">169,179</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 2.5pt double">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">157,580</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 2.5pt double">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">11,599</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 2.5pt double">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">11,599</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</td> <td style="font-size: 10pt; border-bottom: Black 2.5pt double">&nbsp;</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">-</td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</td> </tr> </table> 479910 -390368 870278 868772 1506 -88290 89796 -21856 111652 100053 11599 11599 169854 20847 149007 147403 1604 -4689 6293 6293 39743 -738 40481 40419 62 -1562 1624 910 714 714 12698 617 12081 12053 28 -724 752 415 337 337 702205 1071847 25553 25014 539 -5570 6109 3701 2408 2408 31332 30740 592 -6122 6714 6083 631 631 31506 20891 10615 -44160 54775 1338 53437 53437 790596 -369642 1071847 1145292 14946 -151117 166063 -3116 169179 157580 11599 11599 <p style="font-size: 10pt; margin: 0"><b>NOTE 9 &#x2013; RELATED PARTY TRANSACTIONS</b></p><br/><p style="font-size: 10pt; margin: 0">The Audit Committee has the responsibility to review and approve all transactions to which a related party and the Company may be a party prior to their implementation, to assess whether such transactions meet applicable legal requirements.&nbsp;</p><br/><p style="font-size: 10pt; margin: 0"><i>Convertible Note Issuances to Dr. Samuel Herschkowitz and SOK Partners, LLC</i></p><br/><p style="font-size: 10pt; margin: 0">On September 11, 2013, both the Herschkowitz Note and the SOK Note (each as defined below in this Note 9) were converted in full by the holders thereof at $0.014 per share. The principal and interest balance of the Herschkowitz Note of $314,484 was converted into 299,509 shares of common stock. The principal and interest balance of the SOK Note of $680,444 was converted into 648,050 shares of common stock. The collateral that secured these notes was released back to the Company.</p><br/><p style="font-size: 10pt; margin: 0">The remaining disclosure of this Note 9 provides historical information regarding the Herschkowitz Note, the SOK Note and certain other convertible note issuances.</p><br/><p style="font-size: 10pt; margin: 0">On March 28, 2012, the Company, entered into a Convertible Note Purchase Agreement, dated as of March 28, 2012 (the &#x201c;SOK Purchase Agreement&#x201d;) with SOK Partners, LLC (&#x201c;SOK Partners&#x201d;), and an investment partnership. Josh Kornberg, who is the Company&#x2019;s Chief Executive Officer and interim Chairman of the Board, and Dr. Samuel Herschkowitz are affiliates of the manager of SOK Partners and Ricardo Koenigsberger, a director, is a holder of membership units of SOK Partners. Pursuant to the SOK Purchase Agreement, the Company issued a 20.0% convertible note due August 2012 in the principal amount of up to $600,000. Principal and accrued interest on the note is due and payable on August 28, 2012. The Company&#x2019;s obligations under the note are secured by the grant of a security interest in substantially all tangible and intangible assets of the Company. The SOK Purchase Agreement and the note included customary events of default that include, among other things, non-payment defaults, covenant defaults, inaccuracy of representations and warranties, cross-defaults to other indebtedness and bankruptcy and insolvency defaults. The occurrence of an event of default would have resulted in the acceleration of the Company&#x2019;s obligations under the note, and interest rate of twenty-four (24%) percent per annum accrues if the note had not been paid when due.</p><br/><p style="font-size: 10pt; margin: 0">On March 28, 2012, the Company received an advance of $84,657 under the note, including a cash advance of $60,000 net of a prepayment of interest on the first $300,000 in advances under the note. The holder of the note was entitled to convert the note into shares of common stock of the Company at an initial conversion price per share of $4.88 per share, subject to adjustment in the event of (1) certain issuances of common stock or convertible securities at a price lower than the conversion price of the note, and (2) recapitalizations, stock splits, reorganizations and similar events. In addition, the Company is required to issue two installments of an equity bonus to SOK Partners in the form of common stock valued at the rate of $4.88 per share. In March 2012, the Company issued the first equity bonus to SOK Partners, consisting of 61,539 shares of common stock, with a second installment due within five business days after SOK Partners has made aggregate advances under the note of at least $300,000. In May 2012 the Company issued the second installment consisting of 61,539 shares of common stock subsequent to SOK Partners surpassing the aggregate advances of $300,000. Until the maturity date of the note, if the Company obtained financing from any other source without the consent of SOK Partners, then the Company is required to issue additional bonus equity in an amount equal to $600,000 less the aggregate advances on the note made prior to the breach. The principal balance of the SOK Note was $357,282 as of December 31, 2012.</p><br/><p style="font-size: 10pt; text-align: justify; margin: 0">As long as any amount payable under the SOK Note remained outstanding, SOK Partners or its designee were entitled to appoint a new member to the Company&#x2019;s Board of Directors, to be appointed upon request. Ricardo Koenigsberger was appointed to the Board by SOK Partners on June 25, 2012.</p><br/><p style="font-size: 10pt; text-align: justify; margin: 0">On March 28, 2012, the Company signed an Amended and Restated Note Purchase Agreement, dated as of December 20, 2011, with Dr. Samuel Herschkowitz (as amended, the &#x201c;Herschkowitz Purchase Agreement&#x201d;). Pursuant to the Herschkowitz Purchase Agreement, the Company issued a 20.0% convertible note due June 20, 2012 in the principal amount of $240,000 for previous advances under the note. The Company&#x2019;s obligations under the note were secured by the grant of a security interest in substantially all tangible and intangible assets of the Company. The Company has previously issued to Dr. Herschkowitz an equity bonus consisting of 20,623 shares of common stock. An additional 100,000 shares were transferred to Dr. Herschkowitz effective in April 2012, upon the occurrence of an event of default on the note. On August 13, 2012, the Company entered into a settlement and forbearance agreement described below, relating to the defaults under the Herschkowitz Note and other matters.</p><br/><p style="font-size: 10pt; margin: 0">As long as any amount payable under the Herschkowitz Note remained outstanding, Dr. Herschkowitz or his designee was entitled to appoint a special advisor to the Company&#x2019;s Board of Directors, to be appointed as a member of the Board upon request. Pursuant to this authority, Josh Kornberg was appointed to the Board on March 9, 2012. In addition, pursuant to this authority, Mr. Koenigsberger was appointed to the Board on June 25, 2012.</p><br/><p style="font-size: 10pt; margin: 0">Pursuant to a letter dated April 20, 2012, Dr. Herschkowitz advised the Company of the occurrence of numerous events of default under the terms of the Herschkowitz Note and the Herschkowitz Note Purchase Agreement. As a result of such events of default, Dr. Herschkowitz asserted significant rights as a secured creditor of the Company, including his rights as a secured creditor with a security interest in substantially all assets of the Company. Without a settlement relating to the defaults and other matters, Dr. Herschkowitz could have taken action to levy upon the Company&#x2019;s assets, including patents and other intellectual property.</p><br/><p style="font-size: 10pt; margin: 0">In addition, the Company and Atlantic Partners Alliance LLC (&#x201c;APA&#x201d;) were parties to a letter agreement dated March 14, 2012, providing APA and its affiliates (including Dr. Herschkowitz and SOK) with rights to avoid dilution relating to additional issuances of equity securities by the Company through July 14, 2012, evidencing the parties&#x2019; intent that APA would be provided with significant protection against dilution. This protection was in recognition of APA&#x2019;s investments in the Company involving a high degree of risk and the Company&#x2019;s contemplated need for restructuring its indebtedness, which were anticipated to result, and have resulted, in significant dilution. The parties acknowledged that Dr. Herschkowitz and SOK would not have made their historical cash investments in the Company to the same degree had the dilution protection not been provided, and the investments by these parties have enabled the Company to avoid insolvency. Since the respective dates of the Herschkowitz Note Purchase Agreement and the SOK Note Purchase Agreement, the Company has issued in excess of 213,334 shares of common stock to parties other than APA and its affiliates, resulting in significant dilution.</p><br/><p style="font-size: 10pt; margin: 0">Effective August 15, 2012, the Company entered into a letter agreement with Dr. Herschkowitz, APA and SOK (the &#x201c;Forbearance Agreement&#x201d;). Under the Forbearance Agreement, among other things, (i) Dr. Herschkowitz agreed to forbear from asserting his rights as a secured creditor to substantially all of the Company&#x2019;s assets, resulting from the Company&#x2019;s defaults; (ii) the Company issued an aggregate 353,334 shares of common stock to Dr. Herschkowitz and SOK and adjusted the conversion price of their convertible notes to $1.05 per share from $4.88 per share, to satisfy the Company&#x2019;s obligations to adjust for dilution under the March 14, 2012 letter agreement; (iii) Dr. Herschkowitz and SOK agreed to extend the maturity of their notes to December 31, 2012; (iv) the Company agreed to pay certain compensation to Dr. Herschkowitz upon the achievement of financial milestones; and (v) Dr. Herschkowitz clarified and waived certain of his rights, including the right to interest at a penalty rate upon default.</p><br/><p style="font-size: 10pt; text-align: justify; margin: 0">In the Forbearance Agreement, Dr. Herschkowitz agreed to forbear from exercising any of his rights arising under the Herschkowitz Note or the Herschkowitz Note Purchase Agreement with respect to the existing defaults against the Company, subject to the limitations set forth in the letter agreement and without releasing or waiving any future breach of the letter agreement. He further agreed to forbear from exercising any rights with respect to events of default, security interests in the collateral and other similar remedies against the Company or his interests under the Herschkowitz Note or the Herschkowitz Note Purchase Agreement until the occurrence of an event of default under the Herschkowitz Note: (a) that does not constitute an existing default; and (b) occurs and accrues after the effective date of the letter agreement.</p><br/><p style="font-size: 10pt; text-align: justify; margin: 0">Dr. Herschkowitz and the Company acknowledged that 100,000 shares of the Company&#x2019;s common stock, constituting the &#x201c;penalty shares&#x201d; under the Herschkowitz Note Purchase Agreement, were delivered to Dr. Herschkowitz in April 2012 as provided in the Herschkowitz Note Purchase Agreement upon an event of default. Notwithstanding a provision that would have increased the rate of interest from 20% to 24% upon an event of default, Dr. Herschkowitz agreed that the Company would not pay the increased rate of interest but would accrue interest at 20% until a subsequent event of default.</p><br/><p style="font-size: 10pt; text-align: justify; margin: 0">Under the Forbearance Agreement, the Herschkowitz Note and the SOK Note were amended as follows: (i) the due dates of the notes were extended to December 31, 2012 from the previous due dates of June 20, 2012 and August 28, 2012, respectively; (ii) Dr. Herschkowitz will release his security agreement after payment of all currently outstanding promissory notes to parties other than SOK; and (iii) the Herschkowitz Note was amended to add certain events of default relating to judgments against the Company or other creditors taking action with respect to the collateral. In consideration of the extension additional milestone fees were revised as described below. Pursuant to a Forbearance and Settlement Agreement with these parties dated August 15, 2012, as subsequently amended, the due date of these notes were extended to August 31, 2013.</p><br/><p style="font-size: 10pt; text-align: justify; margin: 0">APA and its affiliates agreed to terminate the letter agreement regarding dilution dated March 14, 2012. In consideration of the various provisions of the letter agreement and in recognition of the understanding of the parties regarding dilution and the agreements of APA and its affiliates to forbear and to extend the due dates of the notes, the Company (i) issued 176,667 shares to Dr. Herschkowitz, (ii) issued 176,667 shares to SOK, and (iii) the conversion price of the Herschkowitz Note and the SOK Note, respectively was changed to $1.05 per share from $4.88 per share.</p><br/><p style="font-size: 10pt; text-align: justify; margin: 0">In the event that the Company consummated the following series of transactions on or prior to June 30, 2013: (i) a merger or similar transaction with a public shell company, (ii) raising between $2 million and $4 million through an offering of the securities of the public shell company concurrent with or subsequent to the shell merger; and (iii) listing the Company&#x2019;s shares on NASDAQ pursuant to an underwritten offering of the Company&#x2019;s securities resulting in gross proceeds of between $5 million and $30 million, then the Company would have been required to deliver to Dr. Herschkowitz the following compensation: (A) $75,000 upon consummating the shell merger, (B) $150,000 upon consummating the qualifying financing round; and (C) 3% of the gross proceeds of the NASDAQ underwriting, which payment shall under no circumstances be less than $200,000 or greater than $1,000,000. The Company was also required to reimburse Dr. Herschkowitz at his actual out-of-pocket cost for reasonable expenses incurred in connection with the shell transactions, with a maximum limit of $10,000 for such expenses.</p><br/><p style="font-size: 10pt; margin: 0">In connection with the extension of the due date for the Herschkowitz Note and the SOK Note on March 6, 2013, the milestone fees were revised. The following fees were payable to Dr. Herschkowitz in the event that the Company consummates the following series of transactions on or prior to December 31, 2013: (i) financing raising not less than $1 million, compensation of $75,000; (ii) a going private transaction, compensation of $200,000; and (iii) 3% of the gross proceeds of the NASDAQ underwriting, which payment shall under no circumstances be less than $200,000 or greater than $3,000,000. In May 2013 Dr. Herschkowitz received $75,000 after the Company surpassed raising $1 million. On January 6, 2014 a side-letter to the forbearance agreement was signed between Dr. Herschkowitz and the Company. Skyline agreed that the private offering for its Series A Convertible Preferred Stock, plus any future offering of any class of its preferred stock, shall be considered a NASDAQ underwriting for purposes of Section 8(e) of the Forbearance Agreement. As such Dr. Herschkowitz received $200,000 or 3% of the gross proceeds of any such offering per the terms of Section 8(e) of the Forbearance Agreement. In addition, any listing of the Company&#x2019;s shares on the New York Stock Exchange shall qualify as a NASDAQ underwriting under the Forbearance Agreement. For the avoidance of doubt, the payment in the aggregate for all offerings qualifying as a NASDAQ underwriting shall under no circumstances be less than $200,000 or greater than $1,000,000. Section 8(e) of the Forbearance Agreement will apply to any transactions consummated by Skyline on or before June 30, 2014.</p><br/><p style="font-size: 10pt; margin: 0">As a result of the transactions under the Forbearance Agreement and other investments, Dr. Herschkowitz, SOK and their affiliates currently own shares of common stock and securities representing beneficial ownership of approximately 49% of the Company&#x2019;s outstanding common stock, giving such parties significant control over election of the Board of Directors and other matters.</p><br/><p style="font-size: 10pt; margin: 0">On November 6, 2012, the Company issued and sold convertible promissory notes in the total principal amount of $156,243 to Dr. Herschkowitz and certain of his assignees.&nbsp; The Company issued to these parties an aggregate 20,833 shares of common stock in consideration of placement of the notes. The notes bear interest at a rate of 20% per annum and are secured by a security interest in the Company&#x2019;s accounts receivable, patents and certain patent rights and are convertible into common stock upon certain mergers or other fundamental transactions at a conversion price based on the trading price prior to the transaction. The proceeds from this transaction were used to pay off approximately $155,000 in principal amount of secured indebtedness.&nbsp;Such notes were converted in April 2013 into 13,889 shares of common stock at $7.50 per share.</p><br/><p style="font-size: 10pt; margin: 0">In December 2013 the Company received an additional $300,000 in debt financing from SOK Partners under a non-convertible grid note due February 28, 2014, with 10% interest based on a 365 day year. Dr. Herschkowitz received 10% of the gross proceeds in advance, and the Company received $250,000 in three tranches in December 2013. In January 2014, the Company received an additional $20,000 from SOK Partners completing the grid note maximum. Should the company default on the note the interest rate will increase to 20% interest based on a 365 day year. In February 2014, the Company wired $305,589.04 to SOK Partners in complete payment of the grid note, including interest.</p><br/><p style="font-size: 10pt; margin: 0">In connection with the sale of the Preferred Shares on February 4, 2014 as described in Note 3, Josh Kornberg, our CEO, was one of the Purchasers. Mr. Kornberg purchased 19,231 Preferred Shares for a purchase price of $25,000 and received warrants to purchase 52 shares of common stock. As described in Note 1 under &#x201c;Recent Developments,&#x201d; in connection with the Company&#x2019;s proposed offering of Units, the holders of a majority of the Preferred Shares, including Mr. Kornberg, have, as of July 20, 2015, agreed to exchange all of the outstanding Preferred Shares for units with the same terms as the Units (the &#x201c;Exchange Units&#x201d;).</p><br/><p style="font-size: 10pt; margin: 0">On July 23, 2014, the Company entered into the a securities purchase agreement pursuant to which the Company agreed to issue and sell convertible notes and warrants to SOK, under the terms described in Note 4 of this Report.&nbsp;SOK&#x2019;s note (the &#x201c;SOK Note&#x201d;) had an original principal amount of $122,196, and the warrant issued to SOK (the &#x201c;SOK Warrant&#x201d;) was to initially acquire up to 5,431 additional shares of Common Stock for an aggregate purchase price of $100,000 (with a reduced principal amount as described below representing an approximately 8.7% original issue discount). Under a provision in the existing agreements, upon effectiveness of a resale registration statement covering certain shares, on September 9, 2014, the principal amount of the SOK Note was reduced to $108,696 and the number of SOK Warrants was reduced to 4,831 shares. As described in Note 4 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&#x2019;s common stock, in exchange for the Company&#x2019;s agreement to redeem all of the outstanding Convertible Notes promptly following the consummation of the Offering at a redemption price equal to 140% of the principal amount, plus accrued and unpaid interest to the redemption date. During September 2015, the Company redeemed all of the convertible notes for approximately $1.5 million to which approximately $167,031 was paid to the affiliates.</p><br/> 0.014 0.014 314484 299509 680444 648050 0.200 600000 0.24 84657 60000 300000 4.88 61539 61539 300000 600000 357282 0.200 240000 20623 100000 213334 353334 1.05 4.88 100000 176667 176667 2000000 4000000 5000000 30000000 75000 150000 0.03 200000 1000000 10000 1000000 75000 200000 0.03 200000 3000000 75000 200000 0.03 200000 1000000 0.49 156243 20833 0.20 155000 13889 7.50 300000 0.10 0.10 250000 20000 0.20 305589.04 19231 25000 52 122196 5431 100000 0.087 108696 4831 1500000 167031 <p style="font-size: 10pt; margin: 0"><b>Note 10 &#x2013; Retirement Savings Plan</b></p><br/><p style="font-size: 10pt; margin: 0">We have a pre-tax salary reduction/profit-sharing plan under the provisions of Section 401(k) of the Internal Revenue Code, which covers employees meeting certain eligibility requirements. In fiscal 2015 and 2014, we matched 100%, of the employee&#x2019;s contribution up to 4% of their earnings. The employer contribution was $7,021 and $21,735 for the three and nine months ending September 30, 2015 and was $14,102 and $29,596 for the three and nine months ending September 30, 2014, respectively.</p><br/> 1.00 1.00 0.04 0.04 7021 21735 14102 29596 <p style="font-size: 10pt; margin: 0"><b>Note 11 &#x2013; Commitments and Contingencies</b></p><br/><p style="font-size: 10pt; margin: 0"><i>Darryl C. Demaray, Brady P. Farrell, Christopher S. Howell and Ronald W. Walters v. Skyline Medical Inc. </i> On April 29, 2015, the plaintiffs filed an action in District Court in Dakota County, Minnesota against the Company. The four plaintiffs were former employees of the Company who were engaged as a Regional Sales Manager. The Company has attended mediation and reached a settlement agreement with all of the parties. In total, including legal and other fees, the Company has agreed to pay $271,236.</p><br/> 4 271236 <p style="font-size: 10pt; margin: 0"><b>Note 12 &#x2013; Supplemental Cash Flow Data</b></p><br/><p style="font-size: 10pt; margin: 0">Cash payments for interest were $226,960 and $237,121 for the three and nine months ended September 30, 2015 and were $21,627 and $43,233 for the three and nine months ended September 30, 2014.</p><br/> 226960 237121 21627 43233