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Share Name | Share Symbol | Market | Type |
---|---|---|---|
SANUWAVE Health Inc (QB) | USOTC:SNWV | OTCMarkets | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.0005 | 2.44% | 0.021 | 0.021 | 0.0226 | 0.021 | 0.02095 | 0.02095 | 43,871 | 16:13:31 |
Nevada
|
| |
3841
|
| |
20-1176000
|
(State or other Jurisdiction
of Incorporation or Organization)
|
| |
(Primary Standard Industrial
Classification Code Number)
|
| |
(I.R.S. Employer
Identification No.)
|
Large accelerated filer ☐
|
| |
Accelerated filer ☐
|
Non-accelerated filer ☒
|
| |
Smaller reporting company ☒
|
|
| |
Emerging growth company ☐
|
Title of Securities to be Registered
|
| |
Amount to be
Registered(1)
|
| |
Proposed
Maximum
Offering Price
per Share(2)
|
| |
Proposed
Maximum
Aggregate
Offering
Price(2)
|
| |
Amount of
Registration
Fee
|
Common Stock, $0.001 par value(3)
|
| |
131,825,235
|
| |
$0.21
|
| |
$27,683,299.35
|
| |
$3,020.25
|
Common Stock, $0.001 par value(4)
|
| |
131,825,235
|
| |
0.21
|
| |
27,683,299.35
|
| |
3,020.25
|
Common Stock, $0.001 par value(5)
|
| |
9,266,250
|
| |
0.21
|
| |
1,945,912.50
|
| |
212.30
|
Common Stock, $0.001 par value(6)
|
| |
1,750,000
|
| |
0.21
|
| |
367,500.00
|
| |
40.09
|
Total
|
| |
274,666,720
|
| |
|
| |
57,680,011.20
|
| |
6,292.89
|
(1)
|
Pursuant to Rule 416(a) under the Securities Act of 1933, as amended (the “Securities Act”).
|
(2)
|
Estimated in accordance with Rule 457(c) solely for purposes of calculating the registration fee. The maximum price per Security and the maximum aggregate offering price are based on the average of the $0.215 (high) and $0.195 (low) sale price of the Registrant's Common Stock, $0.001 par value (the “Common Stock”) as reported on the OTCQB on October 1, 2020, which date is within five business days prior to filing this Registration Statement.
|
(3)
|
Represents the resale of shares of Common Stock issued in private placements described herein.
|
(4)
|
Represents the resale of shares of Common Stock issued upon the exercise of certain Class E warrants issued in private placements described herein.
|
(5)
|
Represents the resale of shares of Common Stock issued upon the exercise of certain Class E warrants issued to a placement agent as described herein.
|
(6)
|
Represents the resale of shares of Common Stock issued upon the exercise of warrants issued to an investor as described herein.
|
•
|
wound conditions, including diabetic foot ulcers, venous and arterial ulcers, pressure sores, burns and other skin eruption conditions;
|
•
|
orthopedic applications, such as eliminating chronic pain in joints from trauma, arthritis or tendons/ligaments inflammation, speeding the healing of fractures (including nonunion or delayed-union conditions), improving bone density in osteoporosis, fusing bones in the extremities and spine, and other potential sports injury applications;
|
•
|
plastic/cosmetic applications such as cellulite smoothing, graft and transplant acceptance, skin tightening, scarring and other potential aesthetic uses; and
|
•
|
cardiac applications for removing plaque due to atherosclerosis improving heart muscle performance.
|
|
| |
Six Months Ended
|
| |
Year Ended
|
||||||
|
| |
June 30,
2020
|
| |
June 30,
2019
|
| |
December 31,
2019
|
| |
December 31,
2018
|
|
| |
unaudited
|
| |
unaudited
|
| |
|
| |
|
Consolidated Statement of Operations Data
|
| |
|
| |
|
| |
|
| |
|
Revenue
|
| |
$231,893
|
| |
$494,939
|
| |
$1,028,730
|
| |
$1,850,060
|
Net loss
|
| |
$(6,634,168)
|
| |
$(4,931,748)
|
| |
$(10,429,839)
|
| |
$(11,650,394)
|
Weighted average shares outstanding
|
| |
297,856,870
|
| |
165,921,811
|
| |
203,588,106
|
| |
149,537,777
|
Net loss per share - basic and diluted
|
| |
$(0.02)
|
| |
$(0.03)
|
| |
$(0.05)
|
| |
$(0.08)
|
|
| |
|
| |
|
| |
|
| |
|
Consolidated Balance Sheet Data (at end of period)
|
| |
|
| |
|
| |
|
| |
|
Working capital deficit
|
| |
$(13,407,681)
|
| |
$(16,523,773)
|
| |
$(9,910,994)
|
| |
$(15,403,609)
|
Total assets
|
| |
$3,406,948
|
| |
$1,513,076
|
| |
$3,381,992
|
| |
$1,177,728
|
Total liabilities
|
| |
$15,779,481
|
| |
$17,868,582
|
| |
$13,445,593
|
| |
$16,533,827
|
Total stockholders' deficit
|
| |
$(12,372,533)
|
| |
$(16,355,506)
|
| |
$(10,063,601)
|
| |
$(15,356,099)
|
•
|
Our recurring losses from operations and dependency upon future issuances of equity or other financing to fund ongoing operations have raised substantial doubt as to our ability to continue as a going concern.
|
•
|
We have a history of losses and we may continue to incur losses and may not achieve or maintain profitability.
|
•
|
If we are unable to successfully raise additional capital, our viability may be threatened; however, if we do raise additional capital, your percentage ownership as a stockholder could decrease and constraints could be placed on the operations of our business.
|
•
|
The coronavirus, or COVID-19, pandemic has materially and adversely affected our clinical trial operations and may materially and adversely affect our financial results.
|
•
|
Our product candidates may not be developed or commercialized successfully.
|
•
|
The medical device/therapeutic product industries are highly competitive and subject to rapid technological change.
|
•
|
We may not successfully establish and maintain licensing and/or partnership arrangements for our technology for non-medical uses, which could adversely affect our ability to develop and commercialize our non-medical technology.
|
•
|
The results of our clinical trials may be insufficient to obtain regulatory approval for our product candidates.
|
•
|
We are subject to extensive governmental regulation, including the requirement of FDA approval or clearance, before our product candidates may be marketed.
|
•
|
The protection of our intellectual property is critical to our success and any failure on our part to adequately protect those rights could materially adversely affect our business.
|
•
|
Patent applications owned by us or licensed to us may not result in issued patents, and our competitors may commercialize the discoveries we attempt to patent.
|
•
|
Our patents may not be valid or enforceable and may be challenged by third parties.
|
•
|
Our stock price is volatile.
|
•
|
There is currently a limited trading market for our common stock and we cannot predict how liquid the market might become.
|
•
|
Trading for our common stock is limited under the SEC’s penny stock regulations, which has an adverse effect on the liquidity of our common stock.
|
•
|
unanticipated expenditures in research and development or manufacturing activities;
|
•
|
delayed market acceptance of any approved product;
|
•
|
unanticipated expenditures in the acquisition and defense of intellectual property rights;
|
•
|
the failure to develop strategic alliances for the marketing of some of our product candidates;
|
•
|
additional inventory builds to adequately support the launch of new products;
|
•
|
unforeseen changes in healthcare reimbursement for procedures using any of our approved products;
|
•
|
inability to train a sufficient number of physicians to create a demand for any of our approved products;
|
•
|
lack of financial resources to adequately support our operations;
|
•
|
difficulties in maintaining commercial scale manufacturing capacity and capability;
|
•
|
unforeseen problems with our third party manufacturers, service providers or specialty suppliers of certain raw materials;
|
•
|
unanticipated difficulties in operating in international markets;
|
•
|
unanticipated financial resources needed to respond to technological changes and increased competition;
|
•
|
unforeseen problems in attracting and retaining qualified personnel;
|
•
|
the impact of the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Affordability Reconciliation Act (collectively the PPACA) on our operations;
|
•
|
the impact of changes in U.S. health care law and policy on our operations;
|
•
|
enactment of new legislation or administrative regulations;
|
•
|
the application to our business of new court decisions and regulatory interpretations;
|
•
|
claims that might be brought in excess of our insurance coverage;
|
•
|
delays in timing of receipt of required regulatory approvals;
|
•
|
the failure to comply with regulatory guidelines; and
|
•
|
the uncertainty in industry demand and patient wellness behavior.
|
•
|
the FDA or a foreign regulatory authority finds our product candidates ineffective or unsafe;
|
•
|
we do not receive necessary regulatory approvals;
|
•
|
the regulatory review and approval process may take much longer than anticipated, requiring additional time, effort and expense to respond to regulatory comments and/or directives;
|
•
|
the reimbursement for our products is difficult to obtain or is too low, which can hinder the introduction and acceptance of our products in the market;
|
•
|
we are unable to get our product candidates in commercial quantities at reasonable costs; and
|
•
|
the patient and physician community does not accept our product candidates.
|
•
|
adverse or ambiguous results;
|
•
|
undesirable side effects that delay or extend the trials;
|
•
|
the inability to locate, recruit, qualify and retain a sufficient number of clinical investigators or patients for our trials; and
|
•
|
regulatory delays or other regulatory actions.
|
•
|
required compliance with existing and changing foreign healthcare and other regulatory requirements and laws, such as those relating to patient privacy or handling of bio-hazardous waste.
|
•
|
required compliance with anti-bribery laws, data privacy requirements, labor laws and anti-competition regulations.
|
•
|
export or import restrictions.
|
•
|
various reimbursement and insurance regimes.
|
•
|
laws and business practices favoring local companies.
|
•
|
political and economic instability.
|
•
|
potentially adverse tax consequences, tariffs, customs charges, bureaucratic requirements and other trade barriers.
|
•
|
foreign exchange controls; and
|
•
|
difficulties protecting or procuring intellectual property rights.
|
•
|
stockholders may not vote by written consent;
|
•
|
advance notice of business to be brought is required for a meeting of the Company’s stockholders;
|
•
|
no cumulative voting rights for the holders of common stock in the election of directors; and
|
•
|
vacancies in the board of directors may be filled by the affirmative vote of a majority of directors then in office, even if less than a quorum.
|
•
|
the product candidate may not prove to be safe or effective;
|
•
|
the product candidate’s benefits may not outweigh its risks;
|
•
|
the results from advanced clinical trials may not confirm the positive results from pre-clinical studies and early clinical trials;
|
•
|
the FDA or comparable foreign regulatory authorities may interpret data from pre-clinical and clinical testing in different ways than us; and
|
•
|
the FDA or other regulatory agencies may require additional or expanded trials and data.
|
•
|
warning letters;
|
•
|
fines and other monetary penalties;
|
•
|
unanticipated expenditures;
|
•
|
delays in FDA approval and clearance, or FDA refusal to approve or clear a product candidate;
|
•
|
product recall or seizure;
|
•
|
interruption of manufacturing or clinical trials;
|
•
|
operating restrictions;
|
•
|
injunctions; and
|
•
|
criminal prosecutions.
|
•
|
testing;
|
•
|
manufacturing;
|
•
|
quality control;
|
•
|
labeling;
|
•
|
advertising;
|
•
|
promotion;
|
•
|
distribution;
|
•
|
export;
|
•
|
reporting to the FDA certain adverse experiences associated with the use of the products; and
|
•
|
obtaining additional approvals or clearances for certain modifications to the products or their labeling or claims.
|
•
|
the size of the patient population;
|
•
|
the nature of the clinical protocol requirements;
|
•
|
the availability of other treatments or marketed therapies (whether approved or experimental);
|
•
|
our ability to recruit and manage clinical centers and associated trials;
|
•
|
the proximity of patients to clinical sites; and
|
•
|
the patient eligibility criteria for the study.
|
•
|
a 2.3% excise tax on any entity that manufactures or imports medical devices offered for sale in the United States, with limited exceptions, began in 2013 but a two year moratorium has been issued for sales during 2016 and 2017, and new legislation was passed in January 2018 such that the tax will be delayed until January 1, 2020;
|
•
|
a new Patient-Centered Outcomes Research Institute to oversee, identify priorities and conduct comparative clinical effectiveness research;
|
•
|
payment system reforms including a national pilot program on payment bundling to encourage hospitals, physicians and other providers to improve the coordination, quality and efficiency of certain healthcare services through bundled payment models;
|
•
|
an independent payment advisory board that will submit recommendations to reduce Medicare spending if projected Medicare spending exceeds a specified growth rate; and
|
•
|
a new abbreviated pathway for the licensure of biological products that are demonstrated to be biosimilar or interchangeable with a licensed biological product.
|
•
|
required refunding or retroactive adjustment of amounts we have been paid by governmental or private payors.
|
•
|
state or Federal agencies imposing fines, penalties and other sanctions on us.
|
•
|
loss of our right to participate in the Medicare program, state programs, or one or more private payor networks; or
|
•
|
damage to our business and reputation in various markets.
|
•
|
obtain and/or maintain protection for our product candidates under the patent laws of the United States and other countries;
|
•
|
defend and enforce our patents once obtained;
|
•
|
obtain and/or maintain appropriate licenses to patents, patent applications or other proprietary rights held by others with respect to our technology, both in the United States and other countries;
|
•
|
maintain trade secrets and other intellectual property rights relating to our product candidates; and
|
•
|
operate without infringing upon the patents, trademarks, copyrights and proprietary rights of third parties.
|
•
|
we or the owners or other inventors of the patents that we own or that have been licensed to us, or that may be issued or licensed to us in the future, were the first to file patent applications or to invent the subject matter claimed in patent applications relating to the technologies upon which we rely;
|
•
|
others will not independently develop similar or alternative technologies or duplicate any of our technologies;
|
•
|
any of our patent applications will result in issued patents;
|
•
|
the patents and patent applications that we own or that have been licensed to us, or that may be issued or licensed to us in the future, will provide a basis for commercially viable products or will provide us with any competitive advantages, or will not be challenged by third parties;
|
•
|
the patents and patent applications that have been licensed to us are valid and enforceable;
|
•
|
we will develop additional proprietary technologies that are patentable;
|
•
|
we will be successful in enforcing the patents that we own or license and any patents that may be issued or licensed to us in the future against third parties;
|
•
|
the patents of third parties will not have an adverse effect on our ability to do business; or
|
•
|
our trade secrets and proprietary rights will remain confidential.
|
•
|
our ability to obtain additional financing and, if available, the terms and conditions of the financing;
|
•
|
changes in the timing of on-going clinical trial enrollment, the results of our clinical trials and regulatory approvals for our product candidates or failure to obtain such regulatory approvals;
|
•
|
changes in our industry;
|
•
|
additions or departures of key personnel;
|
•
|
sales of our common stock;
|
•
|
our ability to execute our business plan;
|
•
|
operating results that fall below expectations;
|
•
|
period-to-period fluctuations in our operating results;
|
•
|
new regulatory requirements and changes in the existing regulatory environment; and
|
•
|
general economic conditions and other external factors.
|
•
|
investors may have difficulty buying and selling, or obtaining market quotations for our common stock;
|
•
|
market visibility for our common stock may be limited; and
|
•
|
a lack of visibility for our common stock may have a depressive effect on the market for our common stock.
|
Name of Selling Stockholder
|
| |
Number of
Shares of
Common
Stock Owned
Prior to Offering
|
| |
Shares of
Common Stock
to be Sold
Pursuant to
this Prospectus
|
| |
Number of
Shares of
Common
Stock Owned
After Offering
|
| |
Percent of
Shares of
Common
Stock Owned
After Offering
|
Melanie Miner Nemelka
|
| |
42,500,000
|
| |
42,500,000
|
| |
—
|
| |
—
|
Manchester Explorer LP
|
| |
35,000,000
|
| |
35,000,000
|
| |
—
|
| |
—
|
Armistice Capital Master Fund Ltd.
|
| |
25,000,000
|
| |
25,000,000
|
| |
—
|
| |
—
|
Opaleye, L.P.
|
| |
20,000,000
|
| |
20,000,000
|
| |
—
|
| |
—
|
Granite Point Capital Panacea Global Healthcare Fund
|
| |
20,000,000
|
| |
20,000,000
|
| |
—
|
| |
—
|
HealthTronics, Inc.
|
| |
16,550,470
|
| |
16,550,470
|
| |
—
|
| |
—
|
Horberg Enterprises LP
|
| |
10,000,000
|
| |
10,000,000
|
| |
—
|
| |
—
|
CVI Investments, Inc.
|
| |
10,000,000
|
| |
10,000,000
|
| |
—
|
| |
—
|
Michael Vasinkevich
|
| |
5,941,983
|
| |
5,941,983
|
| |
—
|
| |
—
|
Christopher Davis
|
| |
5,000,000
|
| |
5,000,000
|
| |
—
|
| |
—
|
JEB Partners LP
|
| |
5,000,000
|
| |
5,000,000
|
| |
—
|
| |
—
|
Taylor Kelly
|
| |
5,000,000
|
| |
5,000,000
|
| |
—
|
| |
—
|
Andrew O Davis TTEE U/A DTD 07/09/1999
|
| |
5,000,000
|
| |
5,000,000
|
| |
—
|
| |
—
|
Anson Investments Master Fund LP
|
| |
5,000,000
|
| |
5,000,000
|
| |
—
|
| |
—
|
Momona Capital
|
| |
5,000,000
|
| |
5,000,000
|
| |
—
|
| |
—
|
Hudson Bay Master Fund Ltd.
|
| |
5,000,000
|
| |
5,000,000
|
| |
—
|
| |
—
|
Christopher B. Davis Guardianship Dated 01/25/2007
|
| |
4,000,000
|
| |
4,000,000
|
| |
—
|
| |
—
|
Greg Broms
|
| |
4,000,000
|
| |
4,000,000
|
| |
—
|
| |
—
|
Lind Global Macro Fund LP
|
| |
3,500,000
|
| |
3,500,000
|
| |
—
|
| |
—
|
James Besser
|
| |
3,000,000
|
| |
3,000,000
|
| |
—
|
| |
—
|
Frank Family 1996 Trust
|
| |
3,000,000
|
| |
3,000,000
|
| |
—
|
| |
—
|
Morgan Frank
|
| |
3,000,000
|
| |
3,000,000
|
| |
—
|
| |
—
|
Iroquois Capital Investment Group LLC
|
| |
3,000,000
|
| |
3,000,000
|
| |
—
|
| |
—
|
Noam Rubenstein
|
| |
2,918,868
|
| |
2,918,868
|
| |
—
|
| |
—
|
Seawolf Capital LLC
|
| |
2,500,000
|
| |
2,500,000
|
| |
—
|
| |
—
|
Name of Selling Stockholder
|
| |
Number of
Shares of
Common
Stock Owned
Prior to Offering
|
| |
Shares of
Common Stock
to be Sold
Pursuant to
this Prospectus
|
| |
Number of
Shares of
Common
Stock Owned
After Offering
|
| |
Percent of
Shares of
Common
Stock Owned
After Offering
|
5 Trivedi LLC
|
| |
2,500,000
|
| |
2,500,000
|
| |
—
|
| |
—
|
Brio Capital Master Fund Ltd.
|
| |
2,500,000
|
| |
2,500,000
|
| |
—
|
| |
—
|
Iroquois Master Fund Ltd.
|
| |
2,000,000
|
| |
2,000,000
|
| |
—
|
| |
—
|
Michal S. Barish
|
| |
2,000,000
|
| |
2,000,000
|
| |
—
|
| |
—
|
Leigh Severance
|
| |
2,000,000
|
| |
2,000,000
|
| |
—
|
| |
—
|
LGH Investments, LLC
|
| |
1,750,000
|
| |
1,750,000
|
| |
—
|
| |
—
|
Anthony Showen
|
| |
1,600,000
|
| |
1,600,000
|
| |
—
|
| |
—
|
Steve and Eva Kalmbach
|
| |
1,500,000
|
| |
1,500,000
|
| |
—
|
| |
—
|
John M. Fay
|
| |
1,250,000
|
| |
1,250,000
|
| |
—
|
| |
—
|
Thomas Benson Musgrave IIII
|
| |
1,000,000
|
| |
1,000,000
|
| |
—
|
| |
—
|
Brutus & Falco, LP
|
| |
1,000,000
|
| |
1,000,000
|
| |
—
|
| |
—
|
R. Curtis Allen
|
| |
1,000,000
|
| |
1,000,000
|
| |
—
|
| |
—
|
John Palmer
|
| |
750,000
|
| |
750,000
|
| |
—
|
| |
—
|
Osmium Capital, LP
|
| |
720,000
|
| |
720,000
|
| |
—
|
| |
—
|
James Boudreault
|
| |
500,000
|
| |
500,000
|
| |
—
|
| |
—
|
David Kyes
|
| |
500,000
|
| |
500,000
|
| |
—
|
| |
—
|
James R McGraw
|
| |
500,000
|
| |
500,000
|
| |
—
|
| |
—
|
Osmium Spartan LP
|
| |
450,000
|
| |
450,000
|
| |
—
|
| |
—
|
Osmium Capital II, LP
|
| |
330,000
|
| |
330,000
|
| |
—
|
| |
—
|
Craig Schwabe
|
| |
312,736
|
| |
312,736
|
| |
—
|
| |
—
|
Tyler Anderson
|
| |
250,000
|
| |
250,000
|
| |
—
|
| |
—
|
Oasis Capital, LLC
|
| |
250,000
|
| |
250,000
|
| |
—
|
| |
—
|
LHV Trust, dated 4/22/2020
|
| |
250,000
|
| |
250,000
|
| |
—
|
| |
—
|
Ian Miller
|
| |
250,000
|
| |
250,000
|
| |
—
|
| |
—
|
Jeramy Fisher
|
| |
250,000
|
| |
250,000
|
| |
—
|
| |
—
|
Bern Money LLC
|
| |
250,000
|
| |
250,000
|
| |
—
|
| |
—
|
Charles Worthman
|
| |
92,663
|
| |
92,663
|
| |
—
|
| |
—
|
•
|
by operation of law or by reason of our reorganization;
|
•
|
to any FINRA member firm participating in the offering and the officers or partners thereof, if all securities so transferred remain subject to the lock-up restriction described above for the remainder of the time period;
|
•
|
if the aggregate amount of our securities held by the placement agent or related person do not exceed 1% of the securities being offered;
|
•
|
that is beneficially owned on a pro-rata basis by all equity owners of an investment fund, provided that no participating member manages or otherwise directs investments by the fund, and participating members in the aggregate do not own more than 10% of the equity in the fund; or
|
•
|
the exercise or conversion of any security, if all securities received remain subject to the lock-up restriction set forth above for the remainder of the time period.
|
•
|
on any national securities exchange or quotation service on which the securities may be listed or quoted at the time of sale;
|
•
|
in the over-the-counter market;
|
•
|
in transactions otherwise than on these exchanges or systems or in the over-the-counter market;
|
•
|
through the writing or settlement of options, whether such options are listed on an options exchange or otherwise;
|
•
|
ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers;
|
•
|
block trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the block as principal to facilitate the transaction;
|
•
|
purchases by a broker-dealer as principal and resale by the broker-dealer for its account;
|
•
|
an exchange distribution in accordance with the rules of the applicable exchange;
|
•
|
privately negotiated transactions;
|
•
|
short sales made after the date the registration statement of which this prospectus forms a part is declared effective by the SEC;
|
•
|
broker-dealers may agree with a selling security holder to sell a specified number of such shares at a stipulated price per share;
|
•
|
a combination of any such methods of sale; and
|
•
|
any other method permitted pursuant to applicable law.
|
Plan Category
|
| |
Number of
securities to be
issued upon
exercise of
outstanding
options,
warrants and
rights
|
| |
Weighted-
average
exercise price
of outstanding
options,
warrants and
rights
|
| |
Number of
securities
remaining
available for
future issuance
under equity
compensation
plans
(excluding
securities
reflected in
column (a))
|
|
| |
(a)
|
| |
(b)
|
| |
(c)
|
Equity compensation plans approved by security holders
|
| |
—
|
| |
$0.00
|
| |
—
|
Equity compensation plans not approved by security holders
|
| |
34,168,385
|
| |
$0.28
|
| |
1,938,281
|
Total
|
| |
34,168,385
|
| |
$0.28
|
| |
1,938,281
|
•
|
wound conditions, including diabetic foot ulcers, venous and arterial ulcers, pressure sores, burns and other skin eruption conditions;
|
•
|
orthopedic applications, such as eliminating chronic pain in joints from trauma, arthritis or tendons/ligaments inflammation, speeding the healing of fractures (including nonunion or delayed-union conditions), improving bone density in osteoporosis, fusing bones in the extremities and spine, and other potential sports injury applications;
|
•
|
plastic/cosmetic applications such as cellulite smoothing, graft and transplant acceptance, skin tightening, scarring and other potential aesthetic uses; and
|
•
|
cardiac applications for removing plaque due to atherosclerosis improving heart muscle performance.
|
•
|
the scope, rate of progress and cost of our clinical trials;
|
•
|
future clinical trial results;
|
•
|
the cost and timing of regulatory approvals;
|
•
|
the establishment of successful marketing, sales and distribution channels and partnerships, including our efforts to expand our marketing, sales and distribution reach through joint ventures and other contractual arrangements;
|
•
|
the cost and timing associated with establishing reimbursement for our products;
|
•
|
the effects of competing technologies and market developments; and
|
•
|
the industry demand and patient wellness behavior.
|
•
|
wound conditions, including diabetic foot ulcers, venous and arterial ulcers, pressure sores, burns and other skin eruption conditions;
|
•
|
orthopedic applications, such as eliminating chronic pain in joints from trauma, arthritis or tendons/ligaments inflammation, speeding the healing of fractures (including nonunion or delayed-union conditions), improving bone density in osteoporosis, fusing bones in the extremities and spine, and other potential sports injury applications;
|
•
|
plastic/cosmetic applications such as cellulite smoothing, graft and transplant acceptance, skin tightening, scarring and other potential aesthetic uses; and
|
•
|
cardiac applications for removing plaque due to atherosclerosis improving heart muscle performance.
|
•
|
Commercialize and support the domestic distribution of our dermaPACE device to treat diabetic foot ulcers.
|
•
|
Develop and commercialize our noninvasive biological response activating devices in the regenerative medicine area for the treatment of skin, musculoskeletal tissue and vascular structures.
|
•
|
License and seek partnership opportunities for our non-medical acoustic pressure shock wave technology platform, know-how and extensive patent portfolio.
|
•
|
Support the global distribution of our products.
|
•
|
Class I: general controls, such as labeling and adherence to quality system regulations;
|
•
|
Class II: special controls, pre-market notification (510(k)), specific controls such as performance standards, patient registries, and post market surveillance, and additional controls such as labeling and adherence to quality system regulations; and
|
•
|
Class III: special controls and approval of a pre-market approval (PMA) application.
|
•
|
the FDA Quality Systems Regulation (QSR), which governs, among other things, how manufacturers design, test, manufacture, exercise quality control over, and document manufacturing of their products;
|
•
|
labeling and claims regulations, which prohibit the promotion of products for unapproved or “off-label” uses and impose other restrictions on labeling;
|
•
|
the Medical Device Reporting regulation, which requires reporting to the FDA of certain adverse experiences associated with use of the product; and
|
•
|
post market surveillance, including documentation of clinical experience and also follow-on, confirmatory studies.
|
Name
|
| |
Age
|
| |
Position Held
|
Kevin A. Richardson, II
|
| |
52
|
| |
Director, Chairman and Chief Executive Officer
|
Lisa E. Sundstrom
|
| |
50
|
| |
Chief Financial Officer
|
Peter Stegagno
|
| |
60
|
| |
Chief Operating Officer
|
Iulian Cioanta, PhD
|
| |
58
|
| |
Chief Science and Technology Officer
|
John F. Nemelka
|
| |
55
|
| |
Director
|
Alan L. Rubino
|
| |
66
|
| |
Director
|
A. Michael Stolarski
|
| |
50
|
| |
Director
|
Maj-Britt Kaltoft
|
| |
57
|
| |
Director
|
Thomas Price
|
| |
65
|
| |
Director
|
Name and Principal Position
|
| |
Year
|
| |
Salary ($)
|
| |
Option Awards ($)(3)
|
| |
All Other Compensation
($)(4)
|
| |
Total ($)
|
Kevin A. Richardson, II
|
| |
2019
|
| |
401,619(1)
|
| |
6,500
|
| |
31,288
|
| |
439,407
|
Chairman of the Board and Chief Executive Officer (principal executive officer)
|
| |
2018
|
| |
275,000(2)
|
| |
226,600
|
| |
2,459
|
| |
504,059
|
Shri P. Parikh(5)
|
| |
2019
|
| |
311,000
|
| |
6,500
|
| |
30,960
|
| |
348,460
|
President, Healthcare
|
| |
2018
|
| |
182,496
|
| |
206,000
|
| |
10,702
|
| |
399,198
|
Peter Stegagno
|
| |
2019
|
| |
231,295
|
| |
6,500
|
| |
21,519
|
| |
259,314
|
Chief Operating Officer
|
| |
2018
|
| |
200,000
|
| |
154,500
|
| |
15,142
|
| |
369,642
|
(1)
|
Amounts reflect (i) the salary guaranteed by Mr. Richardson’s employment agreement with the Company and (ii) an aggregate amount of $40,000 for fees earned or paid in cash for Mr. Richardson’s service as a director in fiscal 2019 (which aggregate amount is also reflected in the Director Compensation Table, below).
|
(2)
|
On November 30, 2018, Mr. Richardson was named Chief Executive Officer of the Company. Amounts reflect (i) the salary guaranteed by Mr. Richardson’s employment agreement with the Company and (ii) an aggregate amount of $40,000 for fees earned or paid in cash for Mr. Richardson’s service as a director in fiscal 2018.
|
(3)
|
Amounts shown in this column do not reflect dollar amounts actually received by our NEOs. Instead, these amounts reflect the aggregate grant date fair value of each stock or option award in the respective fiscal year, computed in accordance with the provisions of FASB ASC Topic 718. Assumptions used in the calculation of these amounts are included in Note 18 to our consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2019.
|
(4)
|
Includes health, dental, life and disability insurance premiums and 401(k) matching contributions.
|
(5)
|
Mr. Parikh was named President, Healthcare of the Company effective May 31, 2018. Mr. Parikh was named President, Healthcare of the Company effective May 31, 2018. On May 14, 2020, Mr. Parikh notified the Company of his decision to resign effective June 30, 2020.
|
|
| |
Option Awards
|
| |
Stock Awards
|
|||||||||||||||||||||
Name
|
| |
Number of
Securities
Underlying
Unexercised
Options/
Warrants (#)
Exercisable
|
| |
Number of
Securities
Underlying
Unexercised
Options/
Warrants (#)
Unexercisable
|
| |
Equity
Incentive
Plan
Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options (#)
|
| |
Option/
Warrant
Exercise Price
($)
|
| |
Option/
Warrant
Expiration
Date
|
| |
Number of
Shares or
Units of
Stock That
Have Not
Vested (#)
|
| |
Market
Value of
Shares or
Units of
Stock That
Have Not
Vested ($)
|
| |
Equity
Incentive
Plan
Awards:
Number of
Unearned
Shares,
Units or
Other
Rights That
Have Not
Vested (#)
|
| |
Equity
Incentive
Plan
Awards:
Market or
Payout
Value of
Unearned
Shares,
Units or
Other
Rights
That Have
Not Vested
($)
|
Kevin A. Richardson, II
Chairman of the Board and
Chief Executive Officer
(principal executive officer)
|
| |
115,000(1)
|
| |
—
|
| |
—
|
| |
0.35
|
| |
02/21/2023
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
452,381(3)
|
| |
—
|
| |
—
|
| |
0.11
|
| |
10/1/2025
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
||
|
297,619(3)
|
| |
—
|
| |
—
|
| |
0.06
|
| |
10/1/2025
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
||
|
700,000(4)
|
| |
—
|
| |
—
|
| |
0.04
|
| |
6/16/2026
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
||
|
| |
594,300(5)
|
| |
—
|
| |
—
|
| |
0.18
|
| |
11/9/2026
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
| |
900,000(6)
|
| |
—
|
| |
—
|
| |
0.11
|
| |
6/14/2027
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
| |
1,100,000(7)
|
| |
—
|
| |
—
|
| |
0.21
|
| |
9/20/2028
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
| |
50,000(9)
|
| |
—
|
| |
—
|
| |
0.15
|
| |
8/26/2029
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
Shri Parikh
President, Healthcare
|
| |
2,000,000(8)
|
| |
—
|
| |
—
|
| |
0.42
|
| |
5/31/2028
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
1,000,000(7)
|
| |
—
|
| |
—
|
| |
0.21
|
| |
9/20/2028
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
||
|
| |
50,000(9)
|
| |
—
|
| |
—
|
| |
0.15
|
| |
8/26/2029
|
| |
—
|
| |
—
|
| |
—
|
| |
-
|
Peter Stegagno
Chief Operating Officer
|
| |
333,644(1)
|
| |
—
|
| |
—
|
| |
0.35
|
| |
02/21/2023
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
50,000(2)
|
| |
—
|
| |
—
|
| |
0.55
|
| |
5/7/2024
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
||
|
| |
301,587(3)
|
| |
—
|
| |
—
|
| |
0.11
|
| |
10/1/2025
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
| |
198,413(3)
|
| |
—
|
| |
—
|
| |
0.06
|
| |
10/1/2025
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
| |
500,000(4)
|
| |
—
|
| |
—
|
| |
0.04
|
| |
6/16/2026
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
| |
424,500(5)
|
| |
—
|
| |
—
|
| |
0.18
|
| |
11/9/2026
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
| |
600,000(6)
|
| |
—
|
| |
—
|
| |
0.11
|
| |
6/14/2027
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
| |
750,000(7)
|
| |
—
|
| |
—
|
| |
0.21
|
| |
9/20/2028
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
| |
50,000(9)
|
| |
—
|
| |
—
|
| |
0.15
|
| |
8/26/2029
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
(1 )
|
On February 21, 2013, the Company, by mutual agreement with all active employees and directors of the Company, cancelled options granted to the active employees and directors in the year ended December 31, 2011 and prior. In exchange for these options, the active employees and directors received new options to purchase shares of common stock at an exercise price of $0.35 per share. The Company cancelled all options, which were previously granted to Messrs. Richardson and Stegagno. The Company granted Mr. Richardson 115,000 options and Mr. Stegagno 333,644 options on February 21, 2013, which vest one-third at grant date, one-third on February 21, 2014 and one-third on February 21, 2015.
|
(2)
|
The Company granted Mr. Stegagno 50,000 options on May 7, 2014, which vest one-third at grant date, one-third on May 7, 2015 and one-third on May 7, 2016.
|
(3)
|
The Company granted Mr. Richardson 750,000 options and Mr. Stegagno 500,000 options on October 1, 2015, which vest at grant date.
|
(4)
|
The Company granted Mr. Richardson 700,000 options and Mr. Stegagno 500,000 options on June 16, 2016, which vest at grant date.
|
(5)
|
The Company granted Mr. Richardson 594,300 options and Mr. Stegagno 424,500 options on November 9, 2016, which vest at grant date.
|
(6)
|
The Company granted Mr. Richardson 900,000 options and Mr. Stegagno 600,000 options on June 15, 2017, which vest at grant date.
|
(7)
|
The Company granted Mr. Richardson 1,100,000 options, Mr. Parikh 1,000,000 options and Mr. Stegagno 750,000 options on September 20, 2018, which vest at grant date.
|
(8)
|
The Company granted Mr. Parikh 2,000,000 options on May 31, 2018, which vest at grant date.
|
(9)
|
The Company granted 50,000 options each to Mr. Richardson, Mr. Parikh and Mr. Stegagno on August 26, 2019, which vest at grant date.
|
Name
|
| |
Fees Earned or Paid in Cash
($)
|
| |
Option Awards
($)(2)
|
| |
Total
($)
|
Kevin A. Richardson, II(1)
|
| |
40,000
|
| |
—
|
| |
40,000
|
John F. Nemelka
|
| |
40,000
|
| |
6,500
|
| |
46,500
|
Alan L. Rubino
|
| |
40,000
|
| |
6,500
|
| |
46,500
|
A. Michael Stolarski
|
| |
40,000
|
| |
6,500
|
| |
46,500
|
Maj-Britt Kaltoft
|
| |
40,000
|
| |
6,500
|
| |
46,500
|
(1)
|
Mr. Richardson has been the Company’s Chairman of the Board since the Company’s inception. On November 30, 2018, Mr. Richardson was named Chief Executive Officer of the Company. We continue to compensate Mr. Richardson as a director and as an executive officer.
|
(2)
|
On August 26, 2019, the Company issued an option to purchase 50,000 shares of the Company’s common stock at $0.15 per share to non-employee directors John F. Nemelka, Alan L. Rubino, A. Michael Stolarski and Maj-Britt Kaltoft. The following are the aggregate number of option awards outstanding that have been granted to each of directors as of December 31, 2019: Kevin A. Richardson, II – 4,209,300, John F. Nemelka – 1,434,800, Alan L. Rubino – 1,419,800, A. Michael Stolarski – 1,069,800 and Maj-Britt Kaltoft – 700,000.
|
Name of Beneficial Owner(1)
|
| |
Number of Shares
Percent of
Beneficially
Owned
|
| |
Shares
Outstanding(2)
|
A. Michael Stolarski(3)
|
| |
18,081,290
|
| |
3.9%
|
Kevin A. Richardson II(4)
|
| |
13,345,993
|
| |
2.9%
|
Peter Stegagno(5)
|
| |
3,968,007
|
| |
0.9%
|
Iulian Cioanta(6)
|
| |
3,186,146
|
| |
0.7%
|
Lisa E. Sundstrom(7)
|
| |
2,914,500
|
| |
0.6%
|
John F. Nemelka(8)
|
| |
1,446,055
|
| |
0.3%
|
Alan Rubino(9)
|
| |
1,419,800
|
| |
0.3%
|
Maj-Britt Kaltoft(10)
|
| |
700,000
|
| |
0.2%
|
Thomas Price(11)
|
| |
200,000
|
| |
0.0%
|
All directors and executive officers as a group (9 persons)
|
| |
45,461,791
|
| |
9.8%
|
Opaleye. L.P.
|
| |
31,428,554
|
| |
6.7%
|
Manchester Explorer, L.P.
|
| |
24,642,840
|
| |
5.3%
|
(1)
|
Unless otherwise noted, each beneficial owner has the same address as the Company.
|
(2)
|
Applicable percentage ownership is based on 466,094 shares of common stock outstanding as of September 30, 2020. “Beneficial ownership” includes shares for which an individual, directly or indirectly, has or shares voting or investment power, or both, and also includes options that are exercisable within 60 days of September 30, 2020. Unless otherwise indicated, all of the listed persons have sole voting and investment power over the shares listed opposite their names. Beneficial ownership as reported in the above table has been determined in accordance with Rule 13d-3 of the Exchange Act.
|
(3)
|
Includes options to purchase up to 1,069,800 shares of common stock.
|
(4)
|
Includes options to purchase up to 4,209,300 shares of common stock. In addition, this amount includes 1,324,723 shares of common stock owned directly by Prides Capital Fund I, L.P. Prides Capital Partners LLC is the general partner of Prides Capital Fund I, L.P. Mr. Richardson is the controlling shareholder of Prides Capital Partners LLC; therefore, under certain provisions of the Exchange Act, he may be deemed to be the beneficial owner of such securities. Mr. Richardson has also been deputized by Prides Capital Partners LLC to serve on the board. Mr. Richardson disclaims beneficial ownership of all such securities except to the extent of any indirect pecuniary interest (within the meaning of Rule 16a-1 of the Exchange Act) therein.
|
(5)
|
Consists of options to purchase up to 3,208,144 shares of common stock.
|
(6)
|
Includes options to purchase up to 3,170,741 shares of common stock.
|
(7)
|
Consists of options to purchase up to 2,914,500 shares of common stock.
|
(8)
|
Consists of options to purchase up to 1,434,800 shares of common stock.
|
(9)
|
Includes options to purchase up to 1,419,800 shares of common stock.
|
(10)
|
Includes options to purchase up to 700,000 shares of common stock.
|
(11)
|
Includes options to purchase up to 200,000 shares of common stock.
|
•
|
600,000,000 shares are designated as common stock; and
|
•
|
5,000,000 shares are designated as preferred stock.
|
•
|
1% of the number of shares of our Common Stock then outstanding, which equaled 4,660,946 shares as of October 1, 2020, or
|
•
|
the average weekly trading volume of our Common Stock, assuming our shares are then traded on a national securities exchange, during the four calendar weeks preceding the filing of a notice on Form 144 with respect to that sale.
|
Audited Consolidated Financial Statements for the years ended December 31, 2019 and 2018
|
| |
Page
|
| | ||
| | ||
| | ||
| | ||
| | ||
| |
Unaudited Condensed Consolidated Financial Statements for the Six months ended [ ], 2020
|
| |
Page
|
| | ||
| | ||
| | ||
| | ||
| |
|
| |
2019
|
| |
2018
|
ASSETS
|
| |
|
| |
|
CURRENT ASSETS
|
| |
|
| |
|
Cash and cash equivalents
|
| |
$1,760,455
|
| |
$364,549
|
Accounts receivable, net of allowance for doubtful accounts of $72,376 in 2019 and $33,045 in 2018
|
| |
75,543
|
| |
234,774
|
Due from related parties
|
| |
—
|
| |
1,228
|
Inventory
|
| |
542,955
|
| |
357,820
|
Prepaid expenses and other current assets
|
| |
125,405
|
| |
125,111
|
TOTAL CURRENT ASSETS
|
| |
2,504,358
|
| |
1,083,482
|
PROPERTY AND EQUIPMENT, net
|
| |
512,042
|
| |
77,755
|
RIGHT OF USE ASSETS
|
| |
323,661
|
| |
—
|
OTHER ASSETS
|
| |
41,931
|
| |
16,491
|
TOTAL ASSETS
|
| |
$3,381,992
|
| |
$1,177,728
|
|
| |
|
| |
|
LIABILITIES
|
| |
|
| |
|
CURRENT LIABILITIES
|
| |
|
| |
|
Accounts payable
|
| |
$1,439,413
|
| |
$1,592,643
|
Accrued expenses
|
| |
1,111,109
|
| |
689,280
|
Accrued employee compensation
|
| |
1,452,910
|
| |
340,413
|
Contract liabilities
|
| |
66,577
|
| |
131,797
|
Operating lease liability
|
| |
173,270
|
| |
—
|
Finance lease liability
|
| |
121,634
|
| |
—
|
Advances from related parties
|
| |
18,098
|
| |
—
|
Line of credit, related parties
|
| |
212,388
|
| |
883,224
|
Accrued interest, related parties
|
| |
1,859,977
|
| |
1,171,782
|
Short term notes payable
|
| |
587,233
|
| |
1,883,163
|
Convertible promissory notes, net
|
| |
—
|
| |
2,652,377
|
Notes payable, related parties, net
|
| |
5,372,743
|
| |
5,372,743
|
Warrant liability
|
| |
—
|
| |
1,769,669
|
TOTAL CURRENT LIABILITIES
|
| |
12,415,352
|
| |
16,487,091
|
|
| |
|
| |
|
NON-CURRENT LIABILITIES
|
| |
|
| |
|
Contract liabilities
|
| |
573,224
|
| |
46,736
|
Operating lease liability
|
| |
185,777
|
| |
—
|
Finance lease liability
|
| |
271,240
|
| |
—
|
TOTAL NON-CURRENT LIABILITIES
|
| |
1,030,241
|
| |
46,736
|
TOTAL LIABILITIES
|
| |
13,445,593
|
| |
16,533,827
|
|
| |
|
| |
|
COMMITMENTS AND CONTINGENCIES
|
| |
|
| |
|
|
| |
|
| |
|
STOCKHOLDERS' DEFICIT
|
| |
|
| |
|
PREFERRED STOCK, par value $0.001, 5,000,000 shares authorized; no shares issued and outstanding
|
| |
—
|
| |
—
|
PREFERRED STOCK, SERIES A CONVERTIBLE, par value $0.001, 6,175 designated; 6,175 shares issued and 0 shares outstanding in 2019 and 2018
|
| |
—
|
| |
—
|
PREFERRED STOCK, SERIES B CONVERTIBLE, par value $0.001, 293 designated; 293 shares issued and 0 shares outstanding in 2019 and 2018
|
| |
—
|
| |
—
|
COMMON STOCK, par value $0.001, 350,000,000 shares authorized; 293,780,400 and 155,665,138 issued and outstanding in 2019 and 2018, respectively
|
| |
293,781
|
| |
155,665
|
ADDITIONAL PAID-IN CAPITAL
|
| |
115,457,808
|
| |
101,153,882
|
ACCUMULATED DEFICIT
|
| |
(125,752,956)
|
| |
(116,602,778)
|
ACCUMULATED OTHER COMPREHENSIVE LOSS
|
| |
(62,234)
|
| |
(62,868)
|
TOTAL STOCKHOLDERS' DEFICIT
|
| |
(10,063,601)
|
| |
(15,356,099)
|
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT
|
| |
$3,381,992
|
| |
$1,177,728
|
|
| |
2019
|
| |
2018
|
REVENUES
|
| |
|
| |
|
Product
|
| |
$645,169
|
| |
$949,601
|
License fees
|
| |
315,557
|
| |
819,696
|
Other revenue
|
| |
68,004
|
| |
80,763
|
TOTAL REVENUES
|
| |
1,028,730
|
| |
1,850,060
|
|
| |
|
| |
|
COST OF REVENUES
|
| |
|
| |
|
Product
|
| |
454,862
|
| |
525,216
|
Other
|
| |
84,061
|
| |
168,448
|
TOTAL COST OF REVENUES
|
| |
538,923
|
| |
693,664
|
GROSS MARGIN
|
| |
489,807
|
| |
1,156,396
|
|
| |
|
| |
|
OPERATING EXPENSES
|
| |
|
| |
|
Research and development
|
| |
1,181,892
|
| |
981,654
|
Selling and marketing
|
| |
1,590,957
|
| |
521,413
|
General and administrative
|
| |
6,440,093
|
| |
6,811,255
|
Depreciation
|
| |
71,213
|
| |
22,332
|
TOTAL OPERATING EXPENSES
|
| |
9,284,155
|
| |
8,336,654
|
OPERATING LOSS
|
| |
(8,794,348)
|
| |
(7,180,258)
|
|
| |
|
| |
|
OTHER INCOME (EXPENSE)
|
| |
|
| |
|
Gain on warrant valuation adjustment
|
| |
227,669
|
| |
55,376
|
Interest expense
|
| |
(1,147,986)
|
| |
(3,708,562)
|
Interest expense, related party
|
| |
(688,195)
|
| |
(787,586)
|
Other income, net
|
| |
—
|
| |
9,952
|
Loss on foreign currency exchange
|
| |
(26,979)
|
| |
(20,316)
|
TOTAL OTHER INCOME (EXPENSE), NET
|
| |
(1,635,491)
|
| |
(4,451,136)
|
NET LOSS
|
| |
(10,429,839)
|
| |
(11,631,394)
|
|
| |
|
| |
|
OTHER COMPREHENSIVE INCOME (LOSS)
|
| |
|
| |
|
Foreign currency translation adjustments
|
| |
19,844
|
| |
(19,085)
|
TOTAL COMPREHENSIVE LOSS
|
| |
$(10,409,995)
|
| |
$(11,650,479)
|
|
| |
|
| |
|
LOSS PER SHARE:
|
| |
|
| |
|
Net loss - basic and diluted
|
| |
$(0.05)
|
| |
$(0.08)
|
Weighted average shares outstanding - basic and diluted
|
| |
203,588,106
|
| |
149,537,777
|
|
| |
Preferred
Stock
|
| |
|
| |
Common
Stock
|
| |
|
| |
|
| |
|
| |
|
| ||
|
| |
Number of
Shares
Issued and
Outstanding
|
| |
Par Value
|
| |
Number of
Shares
Issued and
Outstanding
|
| |
Par Value
|
| |
Additional
Paid-
in Capital
|
| |
Accumulated
Deficit
|
| |
Accumulated
Other
Comprehensive
Loss
|
| |
Total
|
Balances as of December 31, 2017
|
| |
—
|
| |
$—
|
| |
139,300,122
|
| |
$139,300
|
| |
$94,995,040
|
| |
$(104,971,384)
|
| |
$(43,783)
|
| |
$(9,880,827)
|
Net loss
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
(11,631,394)
|
| |
—
|
| |
(11,631,394)
|
Cashless warrant exercises
|
| |
—
|
| |
—
|
| |
6,395,499
|
| |
6,396
|
| |
(6,396)
|
| |
—
|
| |
—
|
| |
—
|
Proceeds from warrant exercise
|
| |
—
|
| |
—
|
| |
422,939
|
| |
423
|
| |
40,305
|
| |
—
|
| |
—
|
| |
40,728
|
Shares issued for services
|
| |
—
|
| |
—
|
| |
1,049,340
|
| |
1,049
|
| |
180,451
|
| |
—
|
| |
—
|
| |
181,500
|
Conversion of promissory notes
|
| |
—
|
| |
—
|
| |
8,497,238
|
| |
8,497
|
| |
926,199
|
| |
—
|
| |
—
|
| |
934,696
|
Warrants issued for services
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
828,690
|
| |
—
|
| |
—
|
| |
828,690
|
Stock-based compensation
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
2,480,970
|
| |
—
|
| |
—
|
| |
2,480,970
|
Warrants issued with convertible promissory notes
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
808,458
|
| |
—
|
| |
—
|
| |
808,458
|
Beneficial conversion feature on convertible promissory notes
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
709,827
|
| |
—
|
| |
—
|
| |
709,827
|
Warrants issued with promissory note
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
36,104
|
| |
—
|
| |
—
|
| |
36,104
|
Beneficial conversion feature on promissory notes
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
35,396
|
| |
—
|
| |
—
|
| |
35,396
|
Reclassification of warrant liability to equity
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
118,838
|
| |
—
|
| |
—
|
| |
118,838
|
Foreign currency translation adjustment
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
(19,085)
|
| |
(19,085)
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Balances as of December 31, 2018
|
| |
—
|
| |
—
|
| |
155,665,138
|
| |
155,665
|
| |
101,153,882
|
| |
(116,602,778)
|
| |
(62,868)
|
| |
(15,356,099)
|
Net loss
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
(10,429,839)
|
| |
—
|
| |
(10,429,839)
|
Cashless warrant exercises
|
| |
—
|
| |
—
|
| |
4,962,157
|
| |
4,962
|
| |
(4,962)
|
| |
—
|
| |
—
|
| |
—
|
Cashless warrant exercises with waived proceeds
|
| |
450,000
|
| |
450
|
| |
35,550
|
| |
36,000
|
| |
|
| |
|
| |
|
| |
|
Proceeds from warrant exercise
|
| |
—
|
| |
—
|
| |
40,284,422
|
| |
40,285
|
| |
3,581,674
|
| |
—
|
| |
—
|
| |
3,621,959
|
Conversion of short term notes payable and convertible notes payable
|
| |
—
|
| |
—
|
| |
65,247,517
|
| |
65,248
|
| |
6,427,607
|
| |
—
|
| |
—
|
| |
6,492,855
|
Reclassification of warrant liability to equity due to adoption of ASU 2017-11
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
262,339
|
| |
1,279,661
|
| |
—
|
| |
1,542,000
|
Conversion of line of credit, related parties to equity
|
| |
—
|
| |
—
|
| |
7,020,455
|
| |
7,020
|
| |
672,980
|
| |
—
|
| |
—
|
| |
680,000
|
Warrants issued for services
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
186,867
|
| |
—
|
| |
—
|
| |
186,867
|
Shares issued for services
|
| |
—
|
| |
—
|
| |
150,000
|
| |
150
|
| |
28,350
|
| |
—
|
| |
—
|
| |
28,500
|
Proceeds from PIPE offering
|
| |
—
|
| |
—
|
| |
20,000,711
|
| |
20,001
|
| |
2,780,099
|
| |
—
|
| |
—
|
| |
2,800,100
|
Stock-based compensation
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
333,422
|
| |
—
|
| |
—
|
| |
333,422
|
Foreign currency translation adjustment
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
634
|
| |
634
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Balances as of December 31, 2019
|
| |
—
|
| |
$—
|
| |
293,780,400
|
| |
$293,781
|
| |
$115,457,808
|
| |
$(125,752,956)
|
| |
$(62,234)
|
| |
$(10,063,601)
|
|
| |
2019
|
| |
2018
|
CASH FLOWS FROM OPERATING ACTIVITIES
|
| |
|
| |
|
Net loss
|
| |
$(10,429,839)
|
| |
$(11,631,394)
|
Adjustments to reconcile net loss to net cash used by operating activities
|
| |
|
| |
|
Depreciation
|
| |
71,213
|
| |
22,332
|
Change in allowance for doubtful accounts
|
| |
39,331
|
| |
(59,752)
|
Stock-based compensation
|
| |
333,422
|
| |
2,480,970
|
Warrants issued for consulting services
|
| |
186,867
|
| |
828,690
|
Stock issued for consulting services
|
| |
28,500
|
| |
181,500
|
Gain on warrant valuation adjustment
|
| |
(227,669)
|
| |
(55,376)
|
Amortization of operating lease
|
| |
(9,236)
|
| |
—
|
Amortization of debt issuance costs
|
| |
—
|
| |
2,767,361
|
Amortization of debt discount
|
| |
—
|
| |
150,484
|
Waived proceeds from warrant exercise
|
| |
36,000
|
| |
—
|
Accrued interest
|
| |
1,159,713
|
| |
410,289
|
Interest payable, related parties
|
| |
688,195
|
| |
485,875
|
Changes in operating assets and liabilities
|
| |
|
| |
|
Accounts receivable – trade
|
| |
(8,600)
|
| |
(22,502)
|
Inventory
|
| |
(185,135)
|
| |
(123,118)
|
Prepaid expenses
|
| |
(294)
|
| |
(34,823)
|
Due from related parties
|
| |
1,228
|
| |
—
|
Other assets
|
| |
(25,440)
|
| |
(3,802)
|
Operating leases
|
| |
44,622
|
| |
—
|
Accounts payable
|
| |
(138,730)
|
| |
276,120
|
Accrued expenses
|
| |
421,829
|
| |
188,708
|
Accrued employee compensation
|
| |
1,134,497
|
| |
338,733
|
Contract liabilities
|
| |
468,768
|
| |
178,533
|
NET CASH USED BY OPERATING ACTIVITIES
|
| |
(6,410,758)
|
| |
(3,621,172)
|
|
| |
|
| |
|
CASH FLOWS FROM INVESTING ACTIVITIES
|
| |
|
| |
|
Purchases of property and equipment
|
| |
(53,939)
|
| |
(42,888)
|
NET CASH USED BY INVESTING ACTIVITIES
|
| |
(53,939)
|
| |
(42,888)
|
|
| |
|
| |
|
CASH FLOWS FROM FINANCING ACTIVITIES
|
| |
|
| |
|
Proceeds from PIPE offering
|
| |
2,800,100
|
| |
—
|
Advances from related parties
|
| |
2,055,414
|
| |
—
|
Proceeds from warrant exercise
|
| |
1,758,142
|
| |
40,728
|
Proceeds from short term note
|
| |
1,215,000
|
| |
1,637,497
|
Proceeds from line of credit, related party
|
| |
90,000
|
| |
624,000
|
Proceeds from convertible promissory notes, net
|
| |
—
|
| |
1,159,785
|
Proceeds from note payable, product
|
| |
—
|
| |
96,708
|
Payment on line of credit, related party
|
| |
—
|
| |
(144,500)
|
Payments on note payable, product
|
| |
—
|
| |
(96,708)
|
Payments of principal on finance leases
|
| |
(58,687)
|
| |
—
|
NET CASH PROVIDED BY FINANCING ACTIVITIES
|
| |
7,859,969
|
| |
3,317,510
|
|
| |
|
| |
|
EFFECT OF EXCHANGE RATES ON CASH
|
| |
634
|
| |
(19,085)
|
|
| |
|
| |
|
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
|
| |
1,395,906
|
| |
(365,635)
|
|
| |
|
| |
|
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD
|
| |
364,549
|
| |
730,184
|
CASH AND CASH EQUIVALENTS, END OF PERIOD
|
| |
$1,760,455
|
| |
$364,549
|
|
| |
|
| |
|
SUPPLEMENTAL INFORMATION
|
| |
|
| |
|
Cash paid for interest, related parties
|
| |
$—
|
| |
$151,227
|
|
| |
2019
|
| |
2018
|
|
| |
|
| |
|
NONCASH INVESTING AND FINANCING ACTIVITIES
|
| |
|
| |
|
Other warrant exercise
|
| |
$1,863,815
|
| |
$—
|
Conversion of line of credit, related party to equity
|
| |
$680,000
|
| |
$—
|
Conversion of line of credit, related party to accounts receivable
|
| |
$121,000
|
| |
$—
|
Conversion of short term notes payable to equity
|
| |
$3,559,542
|
| |
$—
|
Conversion of convertible promissory notes to equity
|
| |
$2,933,313
|
| |
$934,696
|
Reclassification of warrant liability to equity
|
| |
$1,542,000
|
| |
$—
|
Accounts payable and accrued employee compensation converted to equity
|
| |
$36,500
|
| |
$—
|
Additions to right of use assets from new operating lease liabilities
|
| |
$476,029
|
| |
$—
|
Additions to right of use assets from new finance lease liabilities
|
| |
$451,561
|
| |
$—
|
Reclassification of warrant liability to equity
|
| |
$—
|
| |
$118,838
|
Advances payable converted to convertible promissory notes
|
| |
$—
|
| |
$310,000
|
Accounts payable converted to convertible promissory notes
|
| |
$—
|
| |
$120,000
|
Beneficial conversion feature on convertible debt
|
| |
$—
|
| |
$745,223
|
Warrants issued with debt
|
| |
$—
|
| |
$844,562
|
|
| |
2019
|
| |
2018
|
Stock options
|
| |
34,303,385
|
| |
31,703,385
|
Warrants
|
| |
9,474,091
|
| |
103,994,927
|
Convertible promissory notes
|
| |
2,250,000
|
| |
24,112,518
|
Anti-dilutive equity securities
|
| |
46,027,476
|
| |
159,810,830
|
|
| |
2019
|
| |
2018
|
Inventory - finished goods
|
| |
$357,265
|
| |
$188,116
|
Inventory – parts
|
| |
185,690
|
| |
169,704
|
Total inventory
|
| |
$542,955
|
| |
$357,820
|
|
| |
2019
|
| |
2018
|
Finance lease right of use asset
|
| |
$451,561
|
| |
$—
|
Machines and equipment
|
| |
281,633
|
| |
240,295
|
Office and computer equipment
|
| |
201,841
|
| |
196,150
|
Devices
|
| |
81,059
|
| |
81,059
|
Software
|
| |
38,126
|
| |
38,126
|
Furniture and fixtures
|
| |
22,929
|
| |
16,019
|
Other assets
|
| |
2,259
|
| |
2,259
|
Total
|
| |
1,079,408
|
| |
573,908
|
Accumulated depreciation
|
| |
(567,366)
|
| |
(496,153)
|
Net property and equipment
|
| |
$512,042
|
| |
$77,755
|
|
| |
2019
|
| |
2018
|
Accrued board of director's fees
|
| |
$400,000
|
| |
$200,000
|
Accrued inventory
|
| |
167,050
|
| |
—
|
Accrued executive severance
|
| |
154,000
|
| |
136,000
|
Accrued travel
|
| |
120,000
|
| |
58,993
|
Accrued outside services
|
| |
108,033
|
| |
115,118
|
Accrued legal and professional fees
|
| |
134,970
|
| |
—
|
Accrued clinical study expenses
|
| |
13,650
|
| |
13,650
|
Accrued related party advance
|
| |
—
|
| |
101,137
|
Deferred rent
|
| |
—
|
| |
44,623
|
Accrued computer equipment
|
| |
—
|
| |
8,752
|
Accrued other
|
| |
13,406
|
| |
11,007
|
|
| |
$1,111,109
|
| |
$689,280
|
|
| |
December 31,
2019
|
| |
December 31,
2018
|
Service agreement
|
| |
$133,510
|
| |
$57,365
|
Deposit on product
|
| |
—
|
| |
92,950
|
License fees
|
| |
500,000
|
| |
—
|
Other
|
| |
6,291
|
| |
28,218
|
Total Contract liabilities
|
| |
639,801
|
| |
178,533
|
Non-Current
|
| |
(573,224)
|
| |
(46,736)
|
Total Current
|
| |
$66,577
|
| |
$131,797
|
|
| |
December 31,
2018
|
Weighted average contractual term in years
|
| |
1.13-1.19
|
Weighted average risk free interest rate
|
| |
1.98% - 2.15%
|
Weighted average volatility
|
| |
94% - 99%
|
Forfeiture rate
|
| |
0.0%
|
Expected dividend yield
|
| |
0.0%
|
|
| |
December 31,
2018
|
Weighted average contractual term in years
|
| |
1.14
|
Weighted average risk free interest rate
|
| |
1.96%
|
Weighted average volatility
|
| |
98.2%
|
Forfeiture rate
|
| |
0.0%
|
Expected dividend yield
|
| |
0.0%
|
Warrant class
|
| |
Outstanding
as of
December 31,
2017
|
| |
Issued
|
| |
Exercised
|
| |
Expired
|
| |
Outstanding
as of
December 31,
2018
|
| |
Issued
|
| |
Exercised
|
| |
Expired
|
| |
Outstanding
as of
December 31,
2019
|
Class F Warrants
|
| |
300,000
|
| |
—
|
| |
—
|
| |
(300,000)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
Class G Warrants
|
| |
1,503,409
|
| |
—
|
| |
—
|
| |
(1,503,409)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
Class H Warrants
|
| |
1,988,095
|
| |
—
|
| |
—
|
| |
(1,988,095)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
Class I Warrants
|
| |
1,043,646
|
| |
—
|
| |
—
|
| |
(1,043,646)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
Class K Warrants
|
| |
7,200,000
|
| |
—
|
| |
—
|
| |
—
|
| |
7,200,000
|
| |
—
|
| |
—
|
| |
—
|
| |
7,200,000
|
Class L Warrants
|
| |
63,898,173
|
| |
—
|
| |
(6,639,834)
|
| |
—
|
| |
57,258,339
|
| |
—
|
| |
(57,133,339)
|
| |
(125,000)
|
| |
—
|
Class N Warrants
|
| |
13,943,180
|
| |
17,644,999
|
| |
(1,136,364)
|
| |
—
|
| |
30,451,815
|
| |
—
|
| |
(29,951,815)
|
| |
(500,000)
|
| |
—
|
Class O Warrants
|
| |
6,540,000
|
| |
1,509,091
|
| |
(120,000)
|
| |
—
|
| |
7,929,091
|
| |
—
|
| |
(6,549,090)
|
| |
(470,910)
|
| |
909,091
|
Class P Warrants
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
1,365,000
|
| |
—
|
| |
—
|
| |
1,365,000
|
Series A Warrants
|
| |
1,561,348
|
| |
—
|
| |
(405,666)
|
| |
—
|
| |
1,155,682
|
| |
—
|
| |
(1,092,936)
|
| |
(62,746)
|
| |
—
|
|
| |
97,977,851
|
| |
19,154,090
|
| |
(8,301,864)
|
| |
(4,835,150)
|
| |
103,994,927
|
| |
1,365,000
|
| |
(94,727,180)
|
| |
(1,158,656)
|
| |
9,474,091
|
|
| |
Exercise
price/share
|
| |
Expiration
date
|
Class K Warrants
|
| |
$0.08
|
| |
June 2025
|
Class K Warrants
|
| |
$0.11
|
| |
August 2027
|
Class O Warrants
|
| |
$0.11
|
| |
January 2022
|
Class P Warrants
|
| |
$0.01
|
| |
June 2021
|
Class P Warrants
|
| |
$0.20
|
| |
June 2024
|
|
| |
Class K
Warrants
|
| |
Series A
Warrants
|
| |
Total
|
Warrant liability as of December 31, 2017
|
| |
$1,616,000
|
| |
$327,883
|
| |
$1,943,883
|
Issued
|
| |
—
|
| |
—
|
| |
—
|
Redeemed
|
| |
—
|
| |
(118,838)
|
| |
(118,838)
|
Change in fair value
|
| |
(74,000)
|
| |
18,624
|
| |
(55,376)
|
Warrant liability as of December 31, 2018
|
| |
1,542,000
|
| |
227,669
|
| |
1,769,669
|
Change in fair value
|
| |
—
|
| |
(32,359)
|
| |
(32,359)
|
Expired
|
| |
—
|
| |
(195,310)
|
| |
(195,310)
|
Reclassification due to Adoption of ASU 2017-11 (see Note 2)
|
| |
(1,542,000)
|
| |
—
|
| |
(1,542,000)
|
Warrant liability as of December 31, 2019
|
| |
$—
|
| |
$—
|
| |
$—
|
|
| |
December 31,
2019
|
Right of use assets
|
| |
$323,661
|
Lease liability - right of use
|
| |
December 31,
2019
|
Current portion
|
| |
$173,270
|
Long term portion
|
| |
185,777
|
|
| |
$359,047
|
Year ending December 31,
|
| |
Amount
|
2020
|
| |
$191,713
|
2021
|
| |
197,462
|
Total lease payments
|
| |
389,175
|
Less: Present value adjustment
|
| |
(30,128)
|
Lease liability - right of use
|
| |
$359,047
|
|
| |
December 31
2019
|
Right of use assets
|
| |
$418,088
|
Lease liability - right of use
|
| |
December 31,
2019
|
Current portion
|
| |
$121,634
|
Long term portion
|
| |
271,240
|
|
| |
$392,874
|
Year ending December 31,
|
| |
Amount
|
2020
|
| |
$165,078
|
2021
|
| |
165,078
|
2022
|
| |
130,278
|
Total
|
| |
$460,434
|
1.
|
Identify the contract(s) with a customer. A contract with a customer exists when (i) we enter into an enforceable contract with a customer that defines each party’s rights regarding the goods to be transferred and identifies the payment terms related to these goods, (ii) the contract has commercial substance and, (iii) we determine that collection of substantially all consideration for services that are transferred is probable based on the customer’s intent and ability to pay the promised consideration.
|
2.
|
Identify the performance obligation(s) in the contract. If a contract promises to transfer more than one good or service to a customer, each good or service constitutes a separate performance obligation if the good or service is distinct or capable of being distinct.
|
3.
|
Determine the transaction price. The transaction price is the amount of consideration to which the entity expects to be entitled in exchanging the promised goods or services to the customer.
|
4.
|
Allocate the transaction price to the performance obligations in the contract. For a contract that has more than one performance obligation, an entity should allocate the transaction price to each performance obligation in an amount that depicts the amount of consideration to which an entity expects to be entitled in exchange for satisfying each performance obligation.
|
5.
|
Recognize revenue when (or as) the Company satisfies a performance obligation. For each performance obligation, an entity should determine whether the entity satisfies the performance obligation at a point in time or over time. Appropriate methods of measuring progress include output methods and input methods.
|
|
| |
Year ended December 31, 2019
|
| |
Year ended December 31, 2018
|
||||||||||||
|
| |
United
States
|
| |
International
|
| |
Total
|
| |
United
States
|
| |
International
|
| |
Total
|
Product
|
| |
$277,527
|
| |
$367,642
|
| |
$645,169
|
| |
$209,842
|
| |
$739,759
|
| |
$949,601
|
License fees
|
| |
125,000
|
| |
190,557
|
| |
315,557
|
| |
25,000
|
| |
794,696
|
| |
819,696
|
Other Revenue
|
| |
2,450
|
| |
65,554
|
| |
68,004
|
| |
—
|
| |
80,763
|
| |
80,763
|
|
| |
$404,977
|
| |
$623,753
|
| |
$1,028,730
|
| |
$234,842
|
| |
$1,615,218
|
| |
$1,850,060
|
|
| |
2019
|
| |
2018
|
Weighted average expected life in years
|
| |
5.00
|
| |
5.00
|
Weighted average risk free interest rate
|
| |
1.54% - 2.15%
|
| |
2.84% - 3.21%
|
Weighted average volatility
|
| |
131% - 189%
|
| |
134% - 144%
|
Forfeiture rate
|
| |
0.0%
|
| |
0.0%
|
Expected dividend yield
|
| |
0.0%
|
| |
0.0%
|
|
| |
Options
|
| |
Weighted
Average
Exercise Price
per share
|
Outstanding at December 31, 2017
|
| |
221,593,385
|
| |
$0.31
|
Granted
|
| |
10,110,000
|
| |
$0.25
|
Exercised
|
| |
—
|
| |
$—
|
Forfeited or expired
|
| |
—
|
| |
$—
|
Outstanding at December 31, 2018
|
| |
31,703,385
|
| |
$0.29
|
Granted
|
| |
2,700,000
|
| |
$0.15
|
Exercised
|
| |
—
|
| |
$—
|
Forfeited or expired
|
| |
(100,000)
|
| |
$0.11
|
Outstanding at December 31, 2019
|
| |
34,303,385
|
| |
$0.28
|
Vested and exercisable at December 31, 2019
|
| |
33,928,385
|
| |
$0.29
|
|
| |
Options
|
| |
Weighted
Average
Exercise Price
per share
|
Outstanding at December 31, 2017
|
| |
—
|
| |
$—
|
Granted
|
| |
10,110,000
|
| |
$0.25
|
Vested
|
| |
(10,110,000)
|
| |
$0.25
|
Forfeited or expired
|
| |
—
|
| |
$—
|
Outstanding at December 31, 2018
|
| |
—
|
| |
$—
|
Granted
|
| |
2,700,000
|
| |
$0.15
|
Vested
|
| |
(2,350,000)
|
| |
$0.15
|
Forfeited or expired
|
| |
—
|
| |
$—
|
Outstanding at December 31, 2019
|
| |
350,000
|
| |
$0.18
|
|
| |
2019
|
| |
2018
|
Domestic
|
| |
$(10,595,457)
|
| |
$(12,031,115)
|
Foreign
|
| |
165,618
|
| |
399,721
|
Net loss before provision for income taxes
|
| |
$(10,429,839)
|
| |
$(11,631,394)
|
|
| |
2019
|
| |
2018
|
Current:
|
| |
|
| |
|
Federal
|
| |
$—
|
| |
$—
|
State
|
| |
—
|
| |
—
|
Foreign
|
| |
—
|
| |
—
|
|
| |
—
|
| |
—
|
Deferred:
|
| |
|
| |
|
Federal
|
| |
(2,300,997)
|
| |
(2,157,035)
|
State
|
| |
(409,313)
|
| |
(383,705)
|
Foreign
|
| |
(3,676)
|
| |
2,673
|
Change in valuation allowance
|
| |
2,713,986
|
| |
2,538,067
|
|
| |
$—
|
| |
$—
|
|
| |
2019
|
| |
2018
|
Tax benefit at statutory rate
|
| |
$(2,071,322)
|
| |
$(2,442,593)
|
Increase (reduction) in income taxes resulting from:
|
| |
|
| |
|
State income benefit, net of federal benefit
|
| |
(291,082)
|
| |
(343,257)
|
Non-deductible loss on warrant valuation adjustment
|
| |
(47,810)
|
| |
(11,629)
|
Income (loss) from foreign subsidiaries
|
| |
(2,595)
|
| |
6,699
|
Change in valuation allowance
|
| |
2,713,986
|
| |
2,538,067
|
Other
|
| |
(301,177)
|
| |
252,713
|
Income tax expense (benefit)
|
| |
$—
|
| |
$—
|
|
| |
2019
|
| |
2018
|
Deferred tax assets:
|
| |
|
| |
|
Net operating loss carryforwards
|
| |
$23,727,093
|
| |
$21,320,935
|
Net operating loss carryforwards – foreign
|
| |
20,227
|
| |
16,551
|
Excess of tax basis over book value of property and equipment
|
| |
4,240
|
| |
(2,229)
|
Excess of tax basis over book value of intangible assets
|
| |
73,705
|
| |
146,943
|
Stock-based compensation
|
| |
1,607,841
|
| |
1,520,209
|
Accrued employee compensation
|
| |
357,869
|
| |
83,393
|
Captialized equity costs
|
| |
49,471
|
| |
49,471
|
Inventory reserve
|
| |
38,323
|
| |
29,510
|
|
| |
25,878,769
|
| |
23,164,783
|
Valuation allowance
|
| |
(25,878,769)
|
| |
(23,164,783)
|
Net deferred tax assets
|
| |
$—
|
| |
$—
|
|
| |
June 30,
2020
|
| |
December 31,
2019
|
ASSETS
|
| |
(Unaudited)
|
| |
|
CURRENT ASSETS
|
| |
|
| |
|
Cash and cash equivalents
|
| |
$430,606
|
| |
$1,760,455
|
Accounts receivable, net of allowance for doubtful accounts of $255,503 in 2020 and $72,376 in 2019
|
| |
110,501
|
| |
75,543
|
Inventory
|
| |
651,344
|
| |
542,955
|
Prepaid expenses and other current assets
|
| |
227,086
|
| |
125,405
|
TOTAL CURRENT ASSETS
|
| |
1,419,537
|
| |
2,504,358
|
PROPERTY AND EQUIPMENT, net
|
| |
591,064
|
| |
512,042
|
RIGHT OF USE ASSETS, net
|
| |
243,251
|
| |
323,661
|
DEPOSITS
|
| |
1,110,000
|
| |
—
|
OTHER ASSETS
|
| |
43,096
|
| |
41,931
|
TOTAL ASSETS
|
| |
$3,406,948
|
| |
$3,381,992
|
|
| |
|
| |
|
LIABILITIES
|
| |
|
| |
|
CURRENT LIABILITIES
|
| |
|
| |
|
Accounts payable
|
| |
$1,799,630
|
| |
$1,439,413
|
Accrued expenses
|
| |
1,221,214
|
| |
1,111,109
|
Accrued employee compensation
|
| |
2,010,610
|
| |
1,452,910
|
Contract liabilities
|
| |
551,755
|
| |
66,577
|
Operating lease liability
|
| |
179,524
|
| |
173,270
|
Finance lease liability
|
| |
181,371
|
| |
121,634
|
Convertible promissory notes, net
|
| |
705,980
|
| |
—
|
SBA Loans
|
| |
142,514
|
| |
—
|
Line of credit, related parties
|
| |
222,164
|
| |
212,388
|
Short term notes payable
|
| |
210,000
|
| |
587,233
|
Advances from related parties
|
| |
—
|
| |
18,098
|
Notes payable, related parties, net
|
| |
5,372,743
|
| |
5,372,743
|
Accrued interest, related parties
|
| |
2,229,713
|
| |
1,859,977
|
TOTAL CURRENT LIABILITIES
|
| |
14,827,218
|
| |
12,415,352
|
|
| |
|
| |
|
NON-CURRENT LIABILITIES
|
| |
|
| |
|
Contract liabilities
|
| |
53,782
|
| |
573,224
|
SBA loans
|
| |
471,821
|
| |
—
|
Operating lease liability
|
| |
92,889
|
| |
185,777
|
Finance lease liability
|
| |
333,771
|
| |
271,240
|
TOTAL NON-CURRENT LIABILITIES
|
| |
952,263
|
| |
1,030,241
|
TOTAL LIABILITIES
|
| |
15,779,481
|
| |
13,445,593
|
|
| |
|
| |
|
COMMITMENTS AND CONTINGENCIES
|
| |
|
| |
|
|
| |
|
| |
|
REDEEMABLE PREFERRED STOCK, SERIES C CONVERTIBLE, par value $0.001, 90 designated; 90 shares issued and outstanding in 2020
|
| |
2,250,000
|
| |
—
|
REDEEMABLE PREFERRED STOCK, SERIES D CONVERTIBLE, par value $0.001, 8 designated; 8 shares issued and outstanding in 2020
|
| |
200,000
|
| |
—
|
|
| |
|
| |
|
STOCKHOLDERS’ DEFICIT
|
| |
|
| |
|
PREFERRED STOCK, par value $0.001, 5,000,000 shares authorized; 6,175 and 293 shares designated Series A and Series B, respectively
|
| |
—
|
| |
—
|
|
| |
|
| |
|
COMMON STOCK, par value $0.001, 600,000,000 shares authorized (See Note 18); 302,119,428 and 293,780,400 issued and outstanding in 2020 and 2019, respectively
|
| |
302,119
|
| |
293,781
|
ADDITIONAL PAID-IN CAPITAL
|
| |
117,326,629
|
| |
115,457,808
|
ACCUMULATED DEFICIT
|
| |
(132,387,124)
|
| |
(125,752,956)
|
ACCUMULATED OTHER COMPREHENSIVE LOSS
|
| |
(64,157)
|
| |
(62,234)
|
TOTAL STOCKHOLDERS’ DEFICIT
|
| |
(14,822,533)
|
| |
(10,063,601)
|
TOTAL LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ DEFICIT
|
| |
$3,406,948
|
| |
$3,381,992
|
|
| |
Three Months Ended
|
| |
Six Month Ended
|
||||||
|
| |
June 30,
2020
|
| |
June 30,
2019
|
| |
June 30,
2020
|
| |
June 30,
2019
|
REVENUES
|
| |
|
| |
|
| |
|
| |
|
Product
|
| |
$69,341
|
| |
$220,667
|
| |
$143,900
|
| |
$285,232
|
License fees
|
| |
—
|
| |
66,808
|
| |
10,000
|
| |
173,058
|
Other revenue
|
| |
13,960
|
| |
29,501
|
| |
77,993
|
| |
36,649
|
TOTAL REVENUES
|
| |
83,301
|
| |
316,976
|
| |
231,893
|
| |
494,939
|
|
| |
|
| |
|
| |
|
| |
|
COST OF REVENUES
|
| |
|
| |
|
| |
|
| |
|
Product
|
| |
24,825
|
| |
178,458
|
| |
103,740
|
| |
243,570
|
Other
|
| |
1,522
|
| |
7,423
|
| |
11,484
|
| |
36,164
|
TOTAL COST OF REVENUES
|
| |
26,347
|
| |
185,881
|
| |
115,224
|
| |
279,734
|
GROSS MARGIN
|
| |
56,954
|
| |
131,095
|
| |
116,669
|
| |
215,205
|
|
| |
|
| |
|
| |
|
| |
|
OPERATING EXPENSES
|
| |
|
| |
|
| |
|
| |
|
Research and development
|
| |
264,907
|
| |
307,273
|
| |
551,661
|
| |
567,922
|
Selling and marketing
|
| |
433,151
|
| |
407,477
|
| |
1,041,001
|
| |
565,559
|
General and administrative
|
| |
2,566,793
|
| |
1,426,405
|
| |
4,474,710
|
| |
2,943,860
|
Depreciation
|
| |
64,766
|
| |
9,455
|
| |
117,789
|
| |
17,812
|
TOTAL OPERATING EXPENSES
|
| |
3,329,617
|
| |
2,150,610
|
| |
6,185,161
|
| |
4,095,153
|
OPERATING LOSS
|
| |
(3,272,663)
|
| |
(2,019,515)
|
| |
(6,068,492)
|
| |
(3,879,948)
|
|
| |
|
| |
|
| |
|
| |
|
OTHER INCOME (EXPENSE)
|
| |
|
| |
|
| |
|
| |
|
Gain on warrant valuation adjustment
|
| |
—
|
| |
195,310
|
| |
—
|
| |
227,669
|
Interest expense
|
| |
(168,941)
|
| |
(790,178)
|
| |
(187,673)
|
| |
(938,439)
|
Interest expense, related party
|
| |
(187,172)
|
| |
(112,984)
|
| |
(369,736)
|
| |
(332,671)
|
Loss on foreign currency exchange
|
| |
(4,244)
|
| |
(7,064)
|
| |
(8,267)
|
| |
(8,359)
|
TOTAL OTHER INCOME (EXPENSE), NET
|
| |
(360,357)
|
| |
(714,916)
|
| |
(565,676)
|
| |
(1,051,800)
|
NET LOSS
|
| |
(3,633,020)
|
| |
(2,734,431)
|
| |
(6,634,168)
|
| |
(4,931,748)
|
|
| |
|
| |
|
| |
|
| |
|
OTHER COMPREHENSIVE INCOME (LOSS)
|
| |
|
| |
|
| |
|
| |
|
Foreign currency translation adjustments
|
| |
(6,551)
|
| |
1,489
|
| |
(1,923)
|
| |
(909)
|
TOTAL COMPREHENSIVE LOSS
|
| |
$(3,639,571)
|
| |
$(2,732,942)
|
| |
$(6,636,091)
|
| |
$(4,932,657)
|
|
| |
|
| |
|
| |
|
| |
|
LOSS PER SHARE:
|
| |
|
| |
|
| |
|
| |
|
Net loss - basic and diluted
|
| |
$(0.01)
|
| |
$(0.02)
|
| |
$(0.02)
|
| |
$(0.03)
|
Weighted average shares outstanding - basic and diluted
|
| |
299,497,960
|
| |
174,730,747
|
| |
297,856,870
|
| |
165,921,811
|
|
| |
Preferred Stock
|
| |
Common Stock
|
| |
|
| |
|
| |
|
| |
|
||||||
|
| |
Number of
Shares
Issued and
Outstanding
|
| |
Par Value
|
| |
Number of
Shares
Issued and
Outstanding
|
| |
Par Value
|
| |
Additional
Paid-in Capital
|
| |
Accumulated
Deficit
|
| |
Accumulated
Other
Comprehensive
Loss
|
| |
Total
|
Balances as of January 1, 2019
|
| |
—
|
| |
$—
|
| |
155,665,138
|
| |
$155,665
|
| |
$101,153,882
|
| |
$(116,602,778)
|
| |
$(62,868)
|
| |
$(15,356,099)
|
Net loss
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
(2,197,317)
|
| |
—
|
| |
(2,197,317)
|
Cashless warrant exercises
|
| |
—
|
| |
—
|
| |
704,108
|
| |
704
|
| |
(704)
|
| |
—
|
| |
—
|
| |
—
|
Proceeds from warrant exercise
|
| |
—
|
| |
—
|
| |
620,000
|
| |
620
|
| |
52,580
|
| |
—
|
| |
—
|
| |
53,200
|
Conversion of short term notes and convertible notes payable
|
| |
—
|
| |
—
|
| |
3,333,334
|
| |
3,334
|
| |
263,333
|
| |
—
|
| |
—
|
| |
266,667
|
Reclassification of warrant liability to equity due to adoption of ASU 2017-11
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
262,339
|
| |
1,279,661
|
| |
—
|
| |
1,542,000
|
Foreign currency translation adjustment
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
(2,398)
|
| |
(2,398)
|
Balances as of March 31, 2019
|
| |
—
|
| |
$—
|
| |
160,322,580
|
| |
$160,323
|
| |
$101,731,430
|
| |
$(117,520,434)
|
| |
$(65,266)
|
| |
$(15,693,947)
|
Net loss
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
(2,734,431)
|
| |
—
|
| |
(2,734,431)
|
Cashless warrant exercises
|
| |
—
|
| |
—
|
| |
2,997,375
|
| |
2,997
|
| |
13,003
|
| |
—
|
| |
—
|
| |
16,000
|
Proceeds from warrant exercise
|
| |
—
|
| |
—
|
| |
17,051,769
|
| |
17,052
|
| |
1,333,005
|
| |
—
|
| |
—
|
| |
1,350,057
|
Other warrant exercise
|
| |
—
|
| |
—
|
| |
5,804,167
|
| |
5,804
|
| |
451,697
|
| |
457,501
|
| |
|
| |
|
Conversion of short term notes and convertible notes payable
|
| |
—
|
| |
—
|
| |
2,475,000
|
| |
2,475
|
| |
177,525
|
| |
—
|
| |
—
|
| |
180,000
|
Stock-based compensation
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
31,758
|
| |
—
|
| |
—
|
| |
31,758
|
Warrants issued for consulting services
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
36,067
|
| |
—
|
| |
—
|
| |
36,067
|
Foreign currency translation adjustment
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
1,489
|
| |
1,489
|
Balances as of June 30, 2019
|
| |
—
|
| |
$—
|
| |
188,650,891
|
| |
$188,651
|
| |
$103,774,485
|
| |
$(120,254,865)
|
| |
$(63,777)
|
| |
$(16,355,506)
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Balances as of January 1, 2020
|
| |
—
|
| |
$—
|
| |
293,780,400
|
| |
$293,781
|
| |
$115,457,808
|
| |
$(125,752,956)
|
| |
$(62,234)
|
| |
$(10,063,601)
|
Net loss
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
(3,001,148)
|
| |
—
|
| |
(3,001,148)
|
Proceeds from warrant exercise
|
| |
—
|
| |
—
|
| |
1,000,000
|
| |
1,000
|
| |
9,000
|
| |
—
|
| |
—
|
| |
10,000
|
Shares issued for services
|
| |
—
|
| |
—
|
| |
1,000,000
|
| |
1,000
|
| |
199,000
|
| |
—
|
| |
—
|
| |
200,000
|
Stock-based compensation
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
21,900
|
| |
—
|
| |
—
|
| |
21,900
|
Conversion of short term notes
|
| |
—
|
| |
—
|
| |
1,820,461
|
| |
1,820
|
| |
262,164
|
| |
—
|
| |
—
|
| |
263,984
|
Conversion of advances from related parties
|
| |
—
|
| |
—
|
| |
62,811
|
| |
63
|
| |
2,035
|
| |
—
|
| |
—
|
| |
2,098
|
Foreign currency translation adjustment
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
4,826
|
| |
4,826
|
Balances as of March 31, 2020
|
| |
—
|
| |
$—
|
| |
297,663,672
|
| |
$297,664
|
| |
$115,951,907
|
| |
$(128,754,104)
|
| |
$(57,408)
|
| |
$(12,561,941)
|
Net loss
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
(3,633,020)
|
| |
—
|
| |
(3,633,020)
|
Proceeds from PIPE
|
| |
—
|
| |
—
|
| |
1,071,428
|
| |
1,071
|
| |
148,929
|
| |
—
|
| |
—
|
| |
150,000
|
Proceeds from stock option exercise
|
| |
—
|
| |
—
|
| |
225,000
|
| |
225
|
| |
44,025
|
| |
—
|
| |
—
|
| |
44,250
|
Beneficial conversion feature on convertible debt
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
560,682
|
| |
—
|
| |
—
|
| |
560,682
|
Shares issued for services
|
| |
—
|
| |
—
|
| |
2,200,000
|
| |
2,200
|
| |
515,300
|
| |
—
|
| |
—
|
| |
517,500
|
Conversion of short term notes
|
| |
—
|
| |
—
|
| |
759,328
|
| |
759
|
| |
89,986
|
| |
—
|
| |
—
|
| |
90,745
|
Conversion of advances from related parties
|
| |
—
|
| |
—
|
| |
200,000
|
| |
200
|
| |
15,800
|
| |
—
|
| |
—
|
| |
16,000
|
Foreign currency translation adjustment
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
(6,749)
|
| |
(6,749)
|
Balances as of June 30, 2020
|
| |
—
|
| |
$—
|
| |
302,119,428
|
| |
$302,119
|
| |
$117,326,629
|
| |
$(132,387,124)
|
| |
$(64,157)
|
| |
$(14,822,533)
|
|
| |
Six Months Ended
June 30,
2020
|
| |
Six Months Ended
June 30,
2019
|
CASH FLOWS FROM OPERATING ACTIVITIES
|
| |
|
| |
|
Net loss
|
| |
$(6,634,168)
|
| |
$(4,931,748)
|
Adjustments to reconcile net loss to net cash used by operating activities
|
| |
|
| |
|
Depreciation
|
| |
117,789
|
| |
17,812
|
Bad debt expense
|
| |
183,127
|
| |
25,248
|
Share-based payment
|
| |
739,400
|
| |
67,825
|
Amortization of debt issuance costs
|
| |
69,862
|
| |
—
|
Accrued interest
|
| |
84,072
|
| |
936,658
|
Interest payable, related parties
|
| |
369,736
|
| |
332,671
|
Amortization of operating leases
|
| |
(6,224)
|
| |
(3,471)
|
Waived proceeds from warrant exercise
|
| |
—
|
| |
16,000
|
Gain on warrant valuation adjustment
|
| |
—
|
| |
(227,669)
|
Changes in operating assets and liabilities
|
| |
|
| |
|
Accounts receivable - trade
|
| |
(218,085)
|
| |
34,485
|
Inventory
|
| |
(108,389)
|
| |
(66,112)
|
Prepaid expenses
|
| |
(101,681)
|
| |
(126,505)
|
Due from related parties
|
| |
—
|
| |
1,228
|
Other assets
|
| |
(1,165)
|
| |
(7,070)
|
Operating leases
|
| |
—
|
| |
44,623
|
Accounts payable
|
| |
360,217
|
| |
(135,916)
|
Accrued expenses
|
| |
110,105
|
| |
106,178
|
Accrued employee compensation
|
| |
557,700
|
| |
525,487
|
Contract liabilities
|
| |
(34,264)
|
| |
3,642
|
NET CASH USED BY OPERATING ACTIVITIES
|
| |
(4,511,968)
|
| |
(3,386,634)
|
|
| |
|
| |
|
CASH FLOWS FROM INVESTING ACTIVITIES
|
| |
|
| |
|
Deposit paid towards acquisition
|
| |
(1,110,000)
|
| |
—
|
Purchases of property and equipment
|
| |
(4,855)
|
| |
(25,839)
|
NET CASH USED BY INVESTING ACTIVITIES
|
| |
(1,114,855)
|
| |
(25,839)
|
|
| |
|
| |
|
CASH FLOWS FROM FINANCING ACTIVITIES
|
| |
|
| |
|
Proceeds from sale of convertible preferred stock
|
| |
2,450,000
|
| |
—
|
Proceeds from convertible promissory note
|
| |
1,100,000
|
| |
—
|
Proceeds from SBA loan
|
| |
614,335
|
| |
—
|
Proceeds from PIPE offering
|
| |
150,000
|
| |
—
|
Proceeds from stock option exercise
|
| |
44,250
|
| |
—
|
Proceeds from short term note
|
| |
—
|
| |
1,215,000
|
Proceeds from warrant exercise
|
| |
10,000
|
| |
1,403,257
|
Advances from related parties
|
| |
—
|
| |
585,022
|
Payments of principal on finance leases
|
| |
(69,688)
|
| |
—
|
NET CASH PROVIDED BY FINANCING ACTIVITIES
|
| |
4,298,897
|
| |
3,203,279
|
|
| |
|
| |
|
EFFECT OF EXCHANGE RATES ON CASH
|
| |
(1,923)
|
| |
(909)
|
|
| |
|
| |
|
NET DECREASE IN CASH AND CASH EQUIVALENTS
|
| |
(1,329,849)
|
| |
(210,103)
|
|
| |
|
| |
|
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD
|
| |
1,760,455
|
| |
364,549
|
CASH AND CASH EQUIVALENTS, END OF PERIOD
|
| |
$430,606
|
| |
$154,446
|
|
| |
|
| |
|
NONCASH INVESTING AND FINANCING ACTIVITIES
|
| |
|
| |
|
Conversion of short term notes payable to equity
|
| |
$354,729
|
| |
$724,168
|
Conversion of advances from related parties to equity
|
| |
$18,098
|
| |
$180,000
|
Additions to right of use assets from new finance lease liabilities
|
| |
$127,611
|
| |
$—
|
Beneficial conversion feature on convertible debt
|
| |
$560,682
|
| |
$—
|
Reclassification of warrant liability to equity
|
| |
$—
|
| |
$262,339
|
|
| |
June 30,
2020
|
| |
December 31,
2019
|
Accrued board of director’s fees
|
| |
$416,667
|
| |
$400,000
|
Accrued legal and professional fees
|
| |
200,000
|
| |
134,970
|
Accrued executive severance
|
| |
313,000
|
| |
154,000
|
Accrued travel
|
| |
120,000
|
| |
120,000
|
Accrued outside services
|
| |
106,233
|
| |
108,033
|
Accrued inventory
|
| |
50,275
|
| |
167,050
|
Accrued clinical study expenses
|
| |
13,650
|
| |
13,650
|
Accrued other
|
| |
1,389
|
| |
13,406
|
|
| |
$1,221,214
|
| |
$1,111,109
|
|
| |
June 30,
2020
|
| |
December 31,
2019
|
Service agreement
|
| |
$91,746
|
| |
$133,510
|
License fees
|
| |
500,000
|
| |
500,000
|
Other
|
| |
13,791
|
| |
6,291
|
Total Contract liabilities
|
| |
605,537
|
| |
639,801
|
Non-Current
|
| |
(551,755)
|
| |
(573,224)
|
Total Current
|
| |
$53,782
|
| |
$66,577
|
Warrant class
|
| |
Outstanding as of
December 31, 2019
|
| |
Issued
|
| |
Exercised
|
| |
Expired
|
| |
Outstanding as of
June 30, 2020
|
Class K Warrants
|
| |
7,200,000
|
| |
—
|
| |
—
|
| |
—
|
| |
7,200,000
|
Class O Warrants
|
| |
909,091
|
| |
—
|
| |
—
|
| |
—
|
| |
909,091
|
Class P Warrants
|
| |
1,365,000
|
| |
—
|
| |
(1,000,000)
|
| |
(100,000)
|
| |
265,000
|
Common Stock Purchase Warrants
|
| |
—
|
| |
1,000,000
|
| |
—
|
| |
—
|
| |
1,000,000
|
|
| |
9,474,091
|
| |
1,000,000
|
| |
(1,000,000)
|
| |
(100,000)
|
| |
9,374,091
|
|
| |
Exercise price/share
|
| |
Expiration date
|
Class K Warrants
|
| |
$0.08
|
| |
June 2025
|
Class K Warrants
|
| |
$0.11
|
| |
August 2027
|
Class O Warrants
|
| |
$0.11
|
| |
January2022
|
Class P Warrants
|
| |
$0.20
|
| |
June 2024
|
Common Stock Purchase Warrants
|
| |
$0.35
|
| |
June 2025
|
|
| |
June 30,
2020
|
Weighted average contractual terms in years
|
| |
2.5
|
Weighted average risk free interest rate
|
| |
0.47%
|
Weighted average volatility
|
| |
107.12%
|
|
| |
June 30,
2020
|
Right of use assets
|
| |
$243,251
|
|
| |
June 30,
2020
|
Lease liability - right of use
|
| |
|
Current portion
|
| |
$179,524
|
Long term portion
|
| |
92,889
|
|
| |
$272,413
|
Year ending December 31,
|
| |
Amount
|
2020 (remainder)
|
| |
$97,041
|
2021
|
| |
197,462
|
Total lease payments
|
| |
294,503
|
Less: Present value adjustment
|
| |
(22,090)
|
Lease liability - right of use
|
| |
$272,413
|
|
| |
June 30,
2020
|
Right of use assets
|
| |
$515,551
|
|
| |
June 30,
2020
|
Lease liability - right of use
|
| |
|
Current portion
|
| |
$181,371
|
Long term portion
|
| |
333,771
|
|
| |
$515,141
|
Year ending December 31,
|
| |
Amount
|
2020 (remainder)
|
| |
$117,297
|
2021
|
| |
234,593
|
2022
|
| |
199,793
|
2023
|
| |
18,388
|
Total
|
| |
$570,071
|
|
| |
Three Months Ended June 30, 2020
|
| |
Three Months Ended June 30, 2019
|
||||||||||||
|
| |
United States
|
| |
International
|
| |
Total
|
| |
United States
|
| |
International
|
| |
Total
|
Product
|
| |
$63,076
|
| |
$6,265
|
| |
$69,341
|
| |
$120,488
|
| |
$100,179
|
| |
$220,667
|
License fees
|
| |
—
|
| |
—
|
| |
—
|
| |
6,250
|
| |
60,558
|
| |
66,808
|
Other Revenue
|
| |
711
|
| |
13,249
|
| |
13,960
|
| |
—
|
| |
29,501
|
| |
29,501
|
|
| |
$63,787
|
| |
$19,514
|
| |
$83,301
|
| |
$126,738
|
| |
$190,238
|
| |
$316,976
|
|
| |
Six Months Ended June 30, 2020
|
| |
Six Months Ended June 30, 2019
|
||||||||||||
|
| |
United States
|
| |
International
|
| |
Total
|
| |
United States
|
| |
International
|
| |
Total
|
Product
|
| |
$96,730
|
| |
$47,170
|
| |
$143,900
|
| |
$138,167
|
| |
$147,065
|
| |
$285,232
|
License fees
|
| |
10,000
|
| |
—
|
| |
10,000
|
| |
12,500
|
| |
160,558
|
| |
173,058
|
Other Revenue
|
| |
1,252
|
| |
76,741
|
| |
77,993
|
| |
—
|
| |
36,649
|
| |
36,649
|
|
| |
$107,982
|
| |
$123,911
|
| |
$231,893
|
| |
$150,667
|
| |
$344,272
|
| |
$494,939
|
|
| |
June 30,
2020
|
| |
June 30,
2019
|
Stock options
|
| |
34,168,385
|
| |
32,183,385
|
Preferred stock conversion
|
| |
17,500,000
|
| |
—
|
Warrants
|
| |
9,374,091
|
| |
68,357,635
|
Convertible promissory notes
|
| |
5,227,200
|
| |
26,004,347
|
Short term notes payable
|
| |
2,250,000
|
| |
—
|
Anti-dilutive equity securities
|
| |
68,519,676
|
| |
126,545,367
|
•
|
An amendment to the Company’s Articles of Incorporation to increase the number of authorized shares of Common Stock from 355,000,000 to 605,000,000; and
|
•
|
To grant the board of directors the authority to effect a reverse split of the Company’s outstanding Common Stock at an exchange rate of between 1-for-10 and 1-for-50, with the exact ratio to be determined by the board of directors in its sole discretion.
|
SEC registration fee
|
| |
$6,293
|
Legal fees and expenses
|
| |
15,000
|
Accounting fees and expenses
|
| |
15,000
|
Total
|
| |
$36,293
|
ITEM 14.
|
Indemnification of Directors and Officers
|
ITEM 15.
|
Recent Sales of Unregistered Securities
|
ITEM 16.
|
Exhibits and Financial Statement Schedules
|
Exhibit
No.
|
| |
Description
|
| |
Agreement and Plan of Merger, dated as of September 25, 2009, by and between Rub Music Enterprises, Inc., RME Delaware Merger Sub, Inc. and SANUWAVE, Inc. (Incorporated by reference to Form 8-K filed with the SEC on September 30, 2009).
|
|
| |
Articles of Incorporation (Incorporated by reference to the Form 10-SB filed with the SEC on December 18, 2007).
|
|
| |
Certificate of Amendment to the Articles of Incorporation (Incorporated by reference to Appendix A to the Definitive Schedule 14C filed with the SEC on October 16, 2009).
|
|
| |
Certificate of Amendment to the Articles of Incorporation (Incorporated by reference to Appendix A to the Definitive Schedule 14C filed with the SEC on April 16, 2012).
|
|
| |
Bylaws (Incorporated by reference to the Form 10-SB filed with the SEC on December 18, 2007).
|
|
| |
Certificate of Designation of Preferences, Rights and Limitations of Series A Convertible Preferred Stock of the Company dated March 14, 2014 (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on March 18, 2014).
|
|
| |
Certificate of Amendment to the Articles of Incorporation, dated September 8, 2015 (Incorporated by reference to the Form 10-K filed with the SEC on March 30, 2016).
|
|
| |
Certificate of Designation of Preferences, Rights and Limitations of Series B Convertible Preferred Stock of the Company dated January 12, 2016 (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on January 19, 2016).
|
|
| |
Certificate of Designation of Series C Convertible Preferred Stock of the Company dated January 31, 2020 (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on February 6, 2020).
|
|
| |
Certificate of Designation of Series D Convertible Preferred Stock of the Company dated May 14, 2020 (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on May 20, 2020).
|
|
| |
Certificate of Amendment to the Articles of Incorporation, dated August 3, 2020 (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on August 7, 2020).
|
|
| |
Form of Class E Warrant Agreement (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on August 12, 2020).
|
|
| |
Class K Warrant Agreement by and between the Company and HealthTronics, Inc., dated June 15, 2015 (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on June 18, 2015).
|
|
| |
Amendment No. 1 to Class K Warrant Agreement by and between the Company and HealthTronics, Inc., dated June 28, 2016 (Incorporated by reference to the Form 10-Q filed with the SEC on August 15, 2016).
|
|
| |
Class K Warrant Agreement dated as of August 3, 2017, between the Company and HealthTronics, Inc. (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on August 4, 2017).
|
|
| |
Form of Secured Promissory Note issued to NH Expansion Credit Fund Holdings LP, dated August 6, 2020 (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on August 12, 2020).
|
|
| |
Warrant issued to NH Expansion Credit Fund Holdings LP, dated August 6, 2020 (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on August 12, 2020).
|
|
| |
Warrant issued to HealthTronics, Inc., dated August 6, 2020 (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on August 12, 2020).
|
|
| |
Opinion of Hutchison & Steffen, LLC.
|
|
| |
Amendment to certain Promissory Notes that were dated August 1, 2005, by and among the Company, SANUWAVE, Inc. and HealthTronics, Inc., dated June 15, 2015 (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on June 18, 2015.)
|
Exhibit
No.
|
| |
Description
|
| |
Second Amendment to Certain Promissory Notes entered into as of June 28, 2016 by and among the Company, SANUWAVE, Inc. and HealthTronics, Inc. (Incorporated by reference to the Form 10-Q filed with the SEC on August 15, 2016).
|
|
| |
Third Amendment to promissory notes entered into as of August 3, 2017 by and among the Company, SANUWAVE, Inc. and HealthTronics, Inc. (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on August 4, 2017).
|
|
| |
Asset Purchase Agreement by and between the Company and Celularity Inc., dated August 6, 2020 (Incorporated by reference to the Form 8-K filed with the SEC on August 12, 2020).
|
|
| |
License and Marketing Agreement by and between the Company and Celularity Inc., dated August 6, 2020 (Incorporated by reference to the Form 8-K filed with the SEC on August 12, 2020).
|
|
| |
Convertible Promissory Note issued to Celularity Inc., dated August 6, 2020 (Incorporated by reference to the Form 8-K filed with the SEC on August 12, 2020).
|
|
| |
Form of Securities Purchase Agreement by and among the Company and the accredited investors a party thereto, dated August 6, 2020 (Incorporated by reference to the Form 8-K filed with the SEC on August 12, 2020).
|
|
| |
Note and Warrant Purchase and Security Agreement by and among the Company, the noteholder party thereto and NH Expansion Credit Fund Holdings LP, as agent, dated August 6, 2020 (Incorporated by reference to the Form 8-K filed with the SEC on August 12, 2020).
|
|
| |
Letter Agreement by and between the Company and HealthTronics, Inc., dated August 6, 2020 (Incorporated by reference to the Form 8-K filed with the SEC on August 12, 2020).
|
|
| |
Convertible Promissory Note issued to HealthTronics, Inc., dated August 6, 2020 (Incorporated by reference to the Form 8-K filed with the SEC on August 12, 2020).
|
|
| |
Securities Purchase Agreement by and between the Company and HealthTronics, Inc., dated August 6, 2020 (Incorporated by reference to the Form 8-K filed with the SEC on August 12, 2020).
|
|
| |
Convertible Promissory Note issued to A. Michael Stolarski, dated August 6, 2020 (Incorporated by reference to the Form 8-K filed with the SEC on August 12, 2020).
|
|
| |
List of subsidiaries (Incorporated by reference to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019).
|
|
| |
Consent of Marcum LLP, independent registered public accountants.
|
|
| |
Consent of Hutchison & Steffen, LLC (included in its opinion filed as Exhibit 5.1).
|
|
| |
Power of Attorney (set forth on the signature page of the registration statement).
|
|
101.INS***
|
| |
XBRL Instance
|
101.SCH***
|
| |
XBRL Taxonomy Extension Schema
|
101.CAL***
|
| |
XBRL Taxonomy Extension Calculation
|
101.DEF***
|
| |
XBRL Taxonomy Extension Definition
|
101.LAB***
|
| |
XBRL Taxonomy Extension Labels
|
101.PRE***
|
| |
XBRL Taxonomy Extension Presentation
|
*
|
Filed herewith
|
**
|
Previously filed as the same-numbered exhibit to our registration statement on Form S-1 (File No. 333-213774) filed on July 2, 2018.
|
***
|
XBRL information is furnished and not filed or a part of a registration statement or prospectus for purposes of sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of section 18 of the Exchange Act and otherwise is not subject to liability under these sections.
|
ITEM 17.
|
Undertakings
|
(1)
|
To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
|
(i)
|
To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;
|
(ii)
|
To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20 percent change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement;
|
(iii)
|
To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the Registration Statement;
|
(2)
|
That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
|
(3)
|
To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
|
(4)
|
That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser:
|
(i)
|
Each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.
|
|
| |
SANUWAVE Health, Inc.
|
| |||||
|
| |
|
| |
|
| ||
|
| |
By:
|
| |
/s/ Kevin A. Richardson, II
|
| ||
|
| |
Name:
|
| |
Kevin A. Richardson, II
|
| ||
|
| |
Title:
|
| |
Chief Executive Officer
|
| ||
|
| |
|
| |
|
| |
|
Signatures
|
| |
Capacity
|
| |
Date
|
By: /s/ Kevin A. Richardson, II
|
| |
Director and Chief Executive Officer
(principal executive officer)
|
| |
October 5, 2020
|
Name: Kevin A. Richardson, II
|
| |
|
|||
|
| |
|
| |
|
By: /s/ Lisa Sundstrom
|
| |
Chief Financial Officer (principal financial and accounting officer)
|
| |
October 5, 2020
|
Name: Lisa Sundstrom
|
| |
|
|||
|
| |
|
| |
|
By: /s/ John F. Nemelka
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Director
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October 5, 2020
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Name: John F. Nemelka
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By: /s/ Alan L. Rubino
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Director
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October 5, 2020
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Name: Alan L. Rubino
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By: /s/ A. Michael Stolarski
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Director
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October 5, 2020
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Name: A. Michael Stolarski
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By: /s/ Maj-Britt Kaltoft
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Director
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October 5, 2020
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Name: Maj-Britt Kaltoft
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By: /s/ Thomas Price
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Director
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October 5, 2020
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Name: Thomas Price
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1 Year SANUWAVE Health (QB) Chart |
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