0001437749-19-009666.txt : 20190513 0001437749-19-009666.hdr.sgml : 20190513 20190513163230 ACCESSION NUMBER: 0001437749-19-009666 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 55 CONFORMED PERIOD OF REPORT: 20190331 FILED AS OF DATE: 20190513 DATE AS OF CHANGE: 20190513 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ATOSSA GENETICS INC CENTRAL INDEX KEY: 0001488039 STANDARD INDUSTRIAL CLASSIFICATION: PHARMACEUTICAL PREPARATIONS [2834] IRS NUMBER: 264753208 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-35610 FILM NUMBER: 19818821 BUSINESS ADDRESS: STREET 1: 107 SPRING STREET CITY: SEATTLE STATE: WA ZIP: 98104 BUSINESS PHONE: 206.588.0256 MAIL ADDRESS: STREET 1: 107 SPRING STREET CITY: SEATTLE STATE: WA ZIP: 98104 10-Q 1 atos20190331_10q.htm FORM 10-Q atos20190331_10q.htm
 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

FORM 10-Q

 

(Mark One)

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended March 31, 2019

 

OR

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from _______ to _______

 

Commission file number: 001-35610

 

ATOSSA GENETICS INC.

(Exact name of registrant as specified in its charter)

 

Delaware

26-4753208

(State or other jurisdiction of

(I.R.S. Employer

incorporation or organization)

Identification No.)

 

 

107 Spring Street

98104

Seattle, WA

(Zip Code)

(Address of principal executive offices)

 

 

Registrant’s telephone number, including area code: (206) 325-6086

 

Securities registered pursuance to Section 12(b) of the Act:

 

 

Title of each class

Trading symbol(s)

Name of each exchange on which registered

Common Stock, $0.18 par value

ATOS

NASDAQ

 

 

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒  No ☐

 

Indicate by check mark whether the registrant has submitted electronically, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒  No ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer  ☐

Accelerated filer  ☐

Non-accelerated filer  ☐

Smaller reporting company  ☒

Emerging growth company  ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

 

The number of shares of the registrant’s common stock, $0.18 par value per share, outstanding at May 9, 2019, was 9,124,732.

 

 

 

 

 

 

ATOSSA GENETICS INC.

FORM 10-Q

QUARTERLY REPORT

 

INDEX

 

PART I. FINANCIAL INFORMATION

3

 

 

 

ITEM 1.

Condensed Consolidated Financial Statements – Unaudited

3

 

 

 

 

Condensed Consolidated Balance Sheets as of March 31, 2019 and December 31, 2018

3

 

 

 

 

Condensed Consolidated Statements of Operations for the three months ended March 31, 2019 and 2018

4

 

 

 

 

Condensed Consolidated Statements of Stockholders’ Equity for the three months ended March 31, 2019 and 2018

5

 

 

 

 

Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2019 and 2018

6

 

 

 

 

Notes to Condensed Consolidated Financial Statements

7

 

 

 

ITEM 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

13

 

 

 

ITEM 3

Quantitative and Qualitative Disclosures about Market Risk

17

 

 

 

ITEM 4.

Controls and Procedures

17

 

 

 

PART II. OTHER INFORMATION

18

 

 

 

ITEM 1.

Legal Proceedings

18

 

 

 

ITEM 1A.

Risk Factors

18

 

 

 

ITEM 2.

Unregistered Sales of Equity Securities and Use of Proceeds

18

 

 

 

ITEM 3.

Defaults upon Senior Securities

18

 

 

 

ITEM 4.

Mine Safety Disclosures

18

 

 

 

ITEM 5.

Other Information

18

 

 

 

ITEM 6.

Exhibits

19

 

 

 

SIGNATURES

20

 

2

 

 

 

 

PART I. FINANCIAL INFORMATION

 

ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

ATOSSA GENETICS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

 

   

As of March 31,

         
   

2019

   

As of December 31,

 

Assets

 

(Unaudited)

   

2018

 

Current assets

               

Cash and cash equivalents

  $ 19,568,247     $ 10,380,493  

Restricted cash

    110,000       110,000  

Prepaid expenses

    835,468       509,833  

Research and development tax rebate receivable

    237,856       518,098  

Other current assets

    27,957       30,942  

Total current assets

    20,779,528       11,549,366  
                 

Furniture and equipment, net

    48,212       54,487  

Intangible assets, net

    91,667       99,375  

Right-of-use asset

    88,103          

Other assets

    17,218       17,218  

Total Assets

  $ 21,024,728     $ 11,720,446  
                 

Liabilities and Stockholders' Equity

               

Current liabilities

               

Accounts payable

  $ 463,970     $ 353,328  

Accrued expenses

    74,844       177,074  

Payroll liabilities

    891,758       935,070  

Stock-based compensation liability

            1,410,025  

Lease liability

    50,706          

Other current liabilities

    9,863       39,939  

Total current liabilities

    1,491,141       2,915,436  

Long term liabilities

               

Lease liability long term

    37,397          

Total Liabilities

    1,528,538       2,915,436  
                 

Commitments and contingencies (note 11)

               

Stockholders' equity

               

Preferred stock - $0.001 par value; 10,000,000 shares authorized; 702 and 2,379 shares issued and outstanding as of March 31, 2019 and December 31, 2018, respectively

    1       2  

Additional paid-in capital- Series B convertible preferred stock

    701,999       2,378,997  

Common stock - $0.18 par value; 175,000,000 shares authorized, and 9,122,171 and 5,846,552 shares issued and outstanding, as of March 31, 2019 and December 31, 2018, respectively

    1,641,979       1,052,372  

Additional paid-in capital

    98,056,781       82,204,902  

Accumulated deficit

    (80,904,570 )     (76,831,263 )

Total Stockholders' Equity

    19,496,190       8,805,010  
                 

Total Liabilities and Stockholders' Equity

  $ 21,024,728     $ 11,720,446  

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

 

3

 

 

 

 

ATOSSA GENETICS INC. 

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

 

   

For the Three Months Ended March 31,

 
   

2019

   

2018

 
                 

Operating expenses

               

Research and development

  $ 1,451,236     $ 470,976  

General and administrative

    2,613,093       1,403,465  

Total operating expenses

    4,064,329       1,874,441  

Operating loss

    (4,064,329 )     (1,874,441 )

Other income (expense)

    (8,978 )     59  

Loss before income taxes

    (4,073,307 )     (1,874,382 )

Income taxes

               

Net loss

  $ (4,073,307 )   $ (1,874,382 )

Loss per common share - basic and diluted

  $ (0.62 )   $ (8.48 )

Weighted average shares outstanding - basic and diluted

    6,565,514       220,996  

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

 

 

4

 

 

 

ATOSSA GENETICS INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(UNAUDITED)

 

 

                                                                 
                                                                 
   

Series B Convertible Preferred Stock

           

Common Stock

                         
   

Shares

   

Amount

   

Additional Paid-in Capital

   

Shares

   

Amount

   

Additional Paid-in Capital

   

Accumulated Deficit

   

Total

Stockholders'

Equity

 

Balance at December 31, 2017

          $       $         220,996     $ 477,342     $ 71,887,674     $ (65,426,329 )   $ 6,938,687  

Amortization of commitment shares

                                            (19,852 )             (19,852 )

Compensation cost for stock options granted

                                            215,139               215,139  

Net loss

                                                    (1,874,382 )     (1,874,382 )

Balance at March 31, 2018

          $       $         220,996     $ 477,342     $ 72,082,961     $ (67,300,711 )   $ 5,259,592  

 

 

   

Series B Convertible Preferred Stock

           

Common Stock

                         
   

Shares

   

Amount

   

Additional Paid-in Capital

   

Shares

   

Amount

   

Additional Paid-in Capital

   

Accumulated Deficit

   

Total

Stockholders'

Equity

 

Balance at December 31, 2018

    2,379     $ 2     $ 2,378,997       5,846,552     $ 1,052,372     $ 82,204,902     $ (76,831,263 )   $ 8,805,010  

Issuance of common stock upon warrant exercise

                            2,799,188       503,854       10,832,856               11,336,710  

Conversion of Series B convertible preferred stock to common stock

    (1,677 )     (1 )     (1,676,998 )     476,431       85,753       1,591,246                  

Reclassification of stock-based liability awards to equity upon  cancellation

                                            3,151,944               3,151,944  

Compensation cost for stock options granted

                                            275,833               275,833  

Net loss

                                                    (4,073,307 )     (4,073,307 )

Balance at March 31, 2019

    702     $ 1     $ 701,999       9,122,171     $ 1,641,979     $ 98,056,781     $ (80,904,570 )   $ 19,496,190  

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

 

5

 

 

 

 

ATOSSA GENETICS INC. 

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

 

   

For the Three Months Ended March 31,

 
   

2019

   

2018

 

CASH FLOWS FROM OPERATING ACTIVITIES

               

Net loss

  $ (4,073,307 )   $ (1,874,382 )

Adjustments to reconcile net loss to net cash used in operating activities

               

Compensation cost for stock options granted

    275,833       215,139  

Depreciation and amortization

    13,983       7,864  

Change in fair value of stock-based compensation liability

    1,741,919       -  

Changes in operating assets and liabilities:

               

Prepaid expenses

    (325,635 )     (244,723 )

Research and development tax rebate receivable

    280,242       (37,595 )

Other assets

    2,985       51,512  

Accounts payable

    110,642       (166,554 )

Payroll liabilities

    (43,312 )     (428,440 )

Accrued expenses

    (102,230 )     82,508  

Other current liabilities

    (30,076 )     7,789  

Net cash used in operating activities

    (2,148,956 )     (2,386,882 )
                 

CASH FLOWS FROM INVESTING ACTIVITY

               

Purchase of furniture and equipment

            (51,068 )

Net cash used in investing activities

            (51,068 )
                 

CASH FLOWS FROM FINANCING ACTIVITY

               

Proceeds from exercise of warrants

    11,336,710          

Net cash provided by financing activities

    11,336,710          
                 

NET INCREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH

    9,187,754       (2,437,950 )

CASH, CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING BALANCE

    10,490,493       7,272,469  

CASH, CASH EQUIVALENTS AND RESTRICTED CASH, ENDING BALANCE

  $ 19,678,247     $ 4,834,519  
                 

SUPPLEMENTAL DISCLOSURES

               

Reconciliation of cash, cash equivalents and restricted cash

               

Cash and cash equivalents

  $ 19,568,247     $ 4,779,519  

Restricted cash

    110,000       55,000  

Total cash, cash equivalents and restricted cash shown in the condensed consolidated statements of cash flows

  $ 19,678,247     $ 4,834,519  
                 

NONCASH INVESTING AND FINANCING ACTIVITIES

               

Reclassification of stock-based liability awards to equity upon cancellation

  $ 3,151,944          

Amortization of commitment shares

  $       $ 19,852  

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

 

6

 

 

 

ATOSSA GENETICS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

 

 

NOTE 1: NATURE OF OPERATIONS

 

Atossa Genetics Inc. (the “Company”) was incorporated on April 30, 2009 in the State of Delaware. The Company was formed to develop and market medical devices, laboratory tests and therapeutics to address breast health conditions. The Company’s fiscal year ends on December 31. The Company is focused on development of its pharmaceutical and drug delivery programs.

  

 

NOTE 2: LIQUIDITY AND CAPITAL RESOURCES

 

The Company has incurred net losses and negative operating cash flows since inception. For the three months ended March 31, 2019, the Company recorded a net loss of approximately $4.1 million and used approximately $2.1 million of cash in operating activities. As of March 31, 2019, the Company had approximately $19.6 million in cash and cash equivalents and working capital of approximately $19.3 million. The Company has not yet established an ongoing source of revenue sufficient to cover its operating costs and is currently expending funds in research and development activities that are expected to continue to require funding. Management believes the currently available funding will be sufficient to finance the Company’s operations for at least one year from the date of these Condensed Consolidated Financial Statements. However, the Company will likely require additional funding to continue its activities beyond that date. If adequate funds are not available, the Company may be required to reduce the scope, delay, or eliminate some or all of its planned commercial activities. The accompanying condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the settlement of liabilities in the normal course of business. The condensed consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from uncertainty related to the Company’s ability to continue as a going concern.

 

 

NOTE 3: SUMMARY OF ACCOUNTING POLICIES

 

Basis of Presentation:

 

The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. They do not include all information and notes required by GAAP for complete financial statements. However, except as disclosed herein, there has been no material change in the information disclosed in the Notes to Consolidated Financial Statements included in the Annual Report on Form 10-K of the Company for the year ended December 31, 2018.

 

In the opinion of management, all adjustments (including normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 2019, are not necessarily indicative of the results that may be expected for the year ending December 31, 2019.

  

Use of Estimates:

 

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates.

 

7

 

 

Recently Adopted Accounting Pronouncements:

 

In the first quarter of 2019, we adopted Accounting Standards Update (“ASU”) No. 2016-02, Lease Accounting Topic 842: ("Topic 842") and recognized on our Condensed Consolidated Balance Sheet $101,000 of lease liabilities with corresponding right-of-use assets for operating leases. The new lease standard requires a lessee to measure its operating lease liabilities at the present value of the remaining minimum lease payments with a discounted cash flow model using the interest rate implicit in the lease. If the implicit interest rate cannot be readily determined, the lessee must use its incremental borrowing rate (“IBR”). If the lessee does not have an IBR, the lessee must use a rate that approximates the rate of interest that the lessee would have to pay to borrow on a collateralized basis over a similar term in an amount equal to the lease payments in a similar economic environment. The implicit interest rate was readily determinable for our copier lease; however, we used an IBR to measure our adoption date operating lease liability related to our office space which rate represents our estimated borrowing rate on a secured loan collateralized by similar assets for a similar term. The adoption did not have an impact on the Condensed Consolidated Statements of Cash Flows. As permitted under the standard, we elected prospective application of the new guidance and prior periods continue to be presented in accordance with Accounting Standards Codification ("ASC") Topic 840. Refer to our 2018 Annual Report on Form 10-K for disclosures required by Topic 840. The new standard provides a number of optional practical expedients in transition. We elected the practical expedients to not reassess its prior conclusions about lease identification under the new standard, to not reassess lease classification, to not separate lease and non lease components and to not reassess initial direct costs. We did not elect the practical expedient allowing the use-of-hindsight which would require us to reassess the lease term of its leases based on all facts and circumstances through the effective date and did not elect the practical expedient pertaining to land easements as this is not applicable to our current contract portfolio. See Note 11, Commitments and Contingencies, of the notes to our unaudited condensed consolidated financial statements for additional discussion of our leases and the amounts recognized in these unaudited condensed consolidated financial statements.

 

On January 1, 2019, we adopted ASU 2018-08, Not-for-Profit Entities (Topic 958): Clarifying the Scope and the Accounting Guidance for Contributions Received and Contributions Made. This ASU affects not-for-profit entities and business entities that receive or make contributions of cash. The ASU clarifies and improves the scope and accounting guidance to assist entities in evaluating if those transactions should be accounted for as contributions under the scope of Topic 958 or as an exchange transaction subject to other guidance. The adoption did not have any impact on the financial statements.

 

Recent Accounting Pronouncements: 

 

In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement, to improve the effectiveness of disclosures. The amendments remove, modify, and add certain disclosure requirements in Topic 820, “Fair Value Measurement.” The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. The amendments are effective for fiscal years beginning after December 15, 2019. Early adoption is permitted, including adoption in an interim period. Furthermore, an entity is permitted to early adopt any removed or modified disclosures upon issuance of the update and delay adoption of the additional disclosures until their effective date. We do not expect this amendment to have a material impact on our consolidated financial statements.

 

 

NOTE 4: PREPAID EXPENSES

 

Prepaid expenses consisted of the following:

 

   

March 31,

   

December 31,

 
   

2019

   

2018

 

Prepaid insurance

  $ 234,875     $ 160,576  

Prepaid research and development

    392,894       218,090  

Professional services

    96,250       110,094  

Financial exchange fees

    58,685          

Prepaid rent

    17,100          

Retainer and security deposits

    14,218       16,718  

Other

    21,446       4,355  

Total prepaid expenses

  $ 835,468     $ 509,833  

 

 

NOTE 5: RESEARCH AND DEVELOPMENT TAX REBATE RECEIVABLE

 

On May 23, 2017, Atossa formed a wholly-owned subsidiary in Australia called Atossa Genetics AUS Pty Ltd. The purpose of this subsidiary is to perform research and development activities (“R&D”) including our Phase 1 and Phase 2 Endoxifen clinical trials. Australia offers an R&D cash rebate of $0.435 per dollar spent on qualified R&D activities incurred in the country. For the three months ended March 31, 2019 and 2018, the Company incurred qualified R&D expenses of approximately $80,000 and $86,000, respectively. The Company recorded a rebate receivable of approximately $35,000 and $38,000 for the three months ended March 31, 2019 and 2018, respectively and a corresponding credit to R&D expenses. At March 31, 2019, we had a total R&D rebate receivable of approximately $238,000 that includes approximately $203,000 receivable remaining from the year ended December 31, 2018. 

  

 

NOTE 6: PAYROLL LIABILITIES

 

Payroll liabilities consisted of the following:

 

   

March 31, 2019

   

December 31, 2018

 

Accrued bonuses

  $ 646,433     $ 697,995  

Accrued vacation

    162,619       160,740  

Accrued payroll

    82,706       76,335  

Total payroll liabilities

  $ 891,758     $ 935,070  

 

8

 

 

 

NOTE 7: STOCKHOLDERS’ EQUITY

 

The Company is authorized to issue a total of 185,000,000 shares of stock consisting of 175,000,000 shares of common stock, par value $0.18 per share, and 10,000,000 shares of preferred stock, par value $0.001 per share. The Company has designated 750,000 shares of Series A junior participating preferred stock, par value $0.001 per share, 4,000 shares of Series A convertible preferred stock, par value $0.001 per share, and 25,000 shares of Series B convertible preferred stock, par value $0.001 per share, through the filings of certificates of designation with the Delaware Secretary of State. No shares of Series A junior participating preferred stock and no shares of Series A convertible preferred stock are issued and outstanding as of March 31, 2019.

 

2018 Subscription Rights Offering of Units Consisting of Series B Convertible Preferred Stock and Warrants

 

On May 30, 2018, the Company completed a rights offering pursuant to which the Company sold an aggregate of 13,624 units consisting of an aggregate of 13,624 shares of Series B convertible preferred stock and 3,869,216 warrants, with each warrant exercisable for one share of common stock at an exercise price of $4.05 per share (the “2018 Warrants”), resulting in net proceeds to the Company of approximately $12.3 million, after deducting expenses relating to the rights offering, including dealer-manager fees and expenses, and excluding any proceeds received upon exercise of any warrants.

 

Warrants

 

As of March 31, 2019, 1,070,028 warrants to purchase shares of common stock were outstanding. The warrants have an exercise price of $4.05 and expire on May 30, 2022.

 

For the three months ended March 31, 2019, the Company received approximately $11.3 million from exercises of the 2018 Warrants. As a result of the warrant exercises, the Company issued approximately 2.8 million warrants and issued approximately 2.8 million shares of common stock.

 

Conversion of Series B Convertible Preferred Stock

 

During the three months ended March 31, 2019, certain holders of the Series B convertible preferred stock exercised their conversion option and converted an aggregate of 1,677 shares into 476,431 shares of the Company's common stock based on the conversion ratio of approximately 284 shares of common stock for each share of Series B convertible preferred stock.

 

 

NOTE 8: NET LOSS PER SHARE

 

The Company accounts for and discloses net loss per common share in accordance with ASC Topic 260, Earnings Per Share. Basic net loss per common share is computed by dividing net loss attributable to common stockholders by the weighted average number of common shares outstanding. In addition, in computing the dilutive effect of convertible securities, the numerator is adjusted to add back any convertible preferred dividends. Diluted net loss per common share is computed by dividing net loss attributable to common stockholders by the weighted average number of common shares that would have been outstanding during the period assuming the issuance of common shares for all potential dilutive common shares outstanding. Potential common shares consist of potential future exercises of outstanding stock options and common stock warrants. Because the inclusion of potential common shares would be anti-dilutive for all periods presented they have been excluded from the calculation.

 

The following table summarizes the Company’s calculation of net loss per common share: 

 

    Three Months Ended March 31,  
    2019     2018  

Numerator

               

Net loss attributable to common shareholders

  $ (4,073,307 )   $ (1,874,382 )

Denominator

               

Weighted average common shares outstanding used to compute net loss per share, basic and diluted

    6,565,514       220,996  

Net loss per share of common stock, basic and diluted:

  $ (0.62 )   $ (8.48 )

 

The following table sets forth the number of potential common shares excluded from the calculation of net loss per diluted share for the three months ended March 31, 2019 and 2018 because including them would be anti-dilutive: 

 

   

Three Months Ended March 31,

 
   

2019

   

2018

 

Options to purchase common stock

    783,383       14,473  

Series B convertible preferred stock

    458,994          

Warrants to purchase common stock

    3,369,468       76,235  
      4,611,845       90,708  

 

9

 

 

 

NOTE 9: INCOME TAXES

 

Deferred income tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial reporting and tax bases of assets and liabilities and are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized.

 

As a result of the Company’s cumulative losses, management has concluded that a full valuation allowance against the Company’s net deferred tax assets is appropriate. No income tax liabilities existed as of March 31, 2019 and December 31, 2018, due to the Company’s continuing operating losses.

 

 

NOTE 10: CONCENTRATION OF CREDIT RISK

 

Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash deposits. Accounts at each institution are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000. At March 31, 2019 and December 31, 2018, the Company had $18,925,000 and $10,052,000 in excess of the FDIC insured limit, respectively.

 

 

NOTE 11: COMMITMENTS AND CONTINGENCIES

 

Lease Commitments

 

As discussed in Note 3, we adopted the requirements of ASU No. 2016-02, Lease Accounting: Topic 842and all related amendments on January 1, 2019. Prior to January 1, 2019, we accounted for leases in accordance with ASC Topic 840, Leases. In accordance with Topic 842, we evaluate all contractual agreements at inception to determine if they contain a lease. We measure lease liabilities at present value of lease payments not yet paid, using a discounted cash flow model that requires the use of a discount rate, or incremental borrowing rate.

 

Our operating lease assets consist of an office lease and a copier system lease. Our office lease expires in August of 2020 and our copier system lease expires in October of 2021. None of our leases contain options to extend. Total operating lease expense for the three months ended March 31, 2019, was approximately $12,900 and variable lease payments of taxes and insurance were immaterial.  As of March 31, 2019, the weighted average remaining lease term was approximately 1.7 years and the weighted average discount rate of our operating leases was 12%.

 

 As of March 31, 2019, the future minimum lease payments are approximately $44,000, $44,000 and $12,000 for 2019, 2020 and 2021, respectively. These payments are reported in the condensed consolidated balance sheets at March 31, 2019, net of approximately $12,000 of imputed interest. The cash paid for amounts included in the measurement of operating lease liabilities for the three months ended March 31, 2019 was approximately $14,600.

 

Litigation and Contingencies

 

 We are subject to legal proceedings and claims that arise in the normal course of business. We believe these matters are either without merit or of a kind that should not have a material effect, individually or in the aggregate, on our financial position, results of operations or cash flows.

 

 

NOTE 12: STOCK BASED COMPENSATION

 

Stock Option and Incentive Plan

 

On September 28, 2010, the Board of Directors approved the adoption of the 2010 Stock Option and Incentive Plan the (“2010 Plan”) to provide for the grant of equity-based awards to employees, officers, non-employee directors and other key persons providing services to the Company. Awards of incentive options may be granted under the 2010 Plan until September 2020. No other awards may be granted under the 2010 Plan after the date that is 10 years from the date of stockholder approval. An aggregate of 5,556 shares were initially reserved for issuance in connection with awards granted under the 2010 Plan and on May 18, 2016, an additional 11,111 shares were reserved for issuance under the 2010 Plan. On May 9, 2018, the stockholders approved an additional 125,000 shares for issuance under the 2010 Plan. On April 12, 2018, the stockholders approved an additional 500,000 shares for issuance under the 2010 Plan.

 

10

 

 

The following table presents the automatic additions to the 2010 Plan since inception pursuant to the “evergreen” terms of the 2010 Plan:

 

January 1,

 

Number of
shares

 

2012

    2,502  

2013

    2,871  

2014

    4,128  

2015

    5,463  

2016

    7,257  

2017

    12,623  

2018

    106,076  

2019

    233,862  

Total additional shares

    374,782  

 

 

The Company did not grant options to purchase shares of common stock during the three months ended March 31, 2019 or 2018. No options were exercised during the three months ended March 31, 2019 or 2018. There are 236,430 shares available for grant under the 2010 Plan as of March 31, 2019.

 

Compensation costs associated with the Company’s stock options are recognized, based on the grant-date fair values of these options, over the requisite service period, or vesting period. Accordingly, the Company recognized stock-based compensation expense of $275,833 and $215,139 for the three months ended March 31, 2019 and 2018, respectively (excluding the liability options discussed below).

 

 

   

Three Months Ended March 31,

 
   

2019

   

2018

 

General and administrative

  $ 224,676     $ 166,701  

Research and development

    51,157       48,438  

Total stock compensation Expense

  $ 275,833     $ 215,139  

 

 

Options issued and outstanding as of March 31, 2019, under the 2010 Plan and their activities during the three months then ended are as follows:

 

   

Number of
Underlying
Shares

   

Weighted-
Average
Exercise Price
Per Share

   

Weighted-
Average
Contractual
Life Remaining
in Years

   

Aggregate
Intrinsic Value

 

Outstanding as of January 1, 2019

    783,383     $ 12.14                  

Granted

                               

Forfeited

                               

Expired

                               

Outstanding as of March 31, 2019

    783,383       12.14       8.92     $ 695,400  

Exercisable as of March 31, 2019

    434,515       19.38       8.84     $ 374,063  

Vested and expected to vest

    783,383     $ 12.14       8.92     $ 695,400  

 

At March 31, 2019, there were 348,868 unvested options outstanding and the related unrecognized total compensation cost associated with these options was approximately $876,533. This expense is expected to be recognized over a weighted-average period of 1.40 years.

  

2018 Liability Options

 

On June 27, 2018, the Company granted 2,300,000 options to the Chief Executive Officer (CEO) and 700,000 to the Chief Financial Officer (CFO) (the "Liability Options"). Each option was exercisable for an equivalent number of shares of Company's common stock. The Liability Options were granted pursuant to an option award agreement and were granted outside the Company’s 2010 Plan; however, they were subject to the terms and conditions of the 2010 Plan. On January 13, 2019, the Liability Options were canceled.

 

11

 

 

The Liability Options were exercisable for shares of common stock at an exercise price of $2.38 per share, which was the fair value on the date of grant. The options had an exercise period of ten years from their date of issuance. If at the time the options were exercised the Company could not deliver shares of common stock to the optionee including, for example, if there were insufficient shares available under the Plan at the time of exercise, then in lieu of the optionee paying the exercise price and the Company issuing shares of stock, the option only would be exercised on a cash “net basis” so that the Company would pay cash in an amount equal to the excess of the fair value of the common stock over the option exercise price. If there were not sufficient shares available under the Plan, the Company would have been obligated to settle these options in cash if they were exercised. Because these options contained provisions that would require the Company to settle the options in cash in an event outside the Company’s control, they were accounted for as liabilities.

 

The Liability Options were subject to vesting requirements. Twenty-five percent of the options were vested as of the grant date, 50% of the options would have vested quarterly over two years, and the remaining 25% would have vested upon achievement of certain milestones related to clinical trial progress. As of January 13, 2019, all of the Liability Options that vested upon achievement of clinical trial milestones were vested. On January 13, 2019, the Liability Options were cancelled and at the time of cancellation, there were 1,125,000 unvested Liability Options outstanding.

 

Compensation costs associated with the Liability Options were initially recognized, based on the grant-date fair values of these options, over the requisite or vesting period for time-based options or when it is probable the performance criteria were achieved for options that vest based on performance. Compensation cost was remeasured each period based on the market value of our underlying stock until award vesting or settlement.

  

At the time of cancellation, the fair value of Liability Options at January 13, 2019, was calculated using the Black-Scholes option-pricing model applying the following assumptions:

 

   

January 13,

 
   

2019

 
         

Risk free interest rate

    2.53

%

Expected term (in years)

    4.50-5.00  

Stock price

  $ 1.36  

Dividend yield

     

%

Expected volatility

    121.0-123.0

%

 

As a result of the cancellation, the Company recognized all remaining unrecognized compensation expense related to these options of $1,741,919, which was included in the following captions in the condensed consolidated statements of operations: 

 

   

Period Ended March 31, 2019

 
         

General and administrative

  $ 1,074,183  

Research and development

    667,736  

Total stock compensation expense

  $ 1,741,919  

 

Also on January 13, 2019, at the same time the Liability Options were cancelled, the Company awarded a new option to the CEO to purchase 2,300,000 shares of Common Stock and a new option to the CFO to purchase 800,000 shares of common stock (the “2019 Options”). The 2019 Options: (i) have an exercise price equal to the fair market value of Common Stock on the date of board of director approval which was $1.36 per share, (ii) do not contain a net cash exercise provision, (iii) are awarded pursuant to the terms and conditions of the 2010 Plan as amended by the Board of Directors on January 13, 2019, to include shares issuable upon exercise of the 2019 Options and other changes to the 2010 Plan so that the 2019 Options do not conflict with the 2010 Plan (the “Amended Plan”), (iv) vest and are exercisable in accordance with the vesting schedule related to the 2018 Liability Options; provided, however, that the 2019 Options are not exercisable unless and until the Company’s stockholders approve the Amended Plan to increase the authorized number of shares available for grant under the Plan and (vi) are subject to and conditioned upon the 2019 Option Agreements with the optionees and the employment agreements with the optionees.

 

The above actions were unanimously approved by the disinterested members of the Board of Directors. The above actions are intended to eliminate the Company’s potential liability associated with the net cash exercise provision of the liability options, and to allow the stockholders of the Company the opportunity to vote on the Amended Plan, which includes shares issuable upon exercise of the 2019 Options.

 

Accounting treatment

 

Awards offered under a plan that are subject to shareholder approval are not considered granted under GAAP until the approval is obtained, unless such approval is essentially a formality (or perfunctory). For example, if management and board members control sufficient votes to approve the plan, the vote may be considered perfunctory. As management and the Company’s Board of Directors do not control enough votes to approve the 2019 Options, the 2019 Options are not deemed granted under ASC 718. Cancellation of an award that is not accompanied by the concurrent grant are accounted for as a repurchase for no consideration. Accordingly, any previously unrecognized compensation cost is recognized at the cancellation date. On January 13, 2019, as noted above, the Company recognized $1,741,919 of unrecognized compensation cost related to the 2018 Liability Options. Additionally, the fair value of the stock-based compensation liability of $3,151,944 was reclassified to additional-paid in capital on the cancellation date. If shareholder approval is obtained and a grant date is established for the 2019 Options, the Company will measure and record them as a new grant under ASC 718.

 

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

The following discussion of the financial condition and results of operations should be read in conjunction with the financial statements and the related notes included elsewhere in this report. This discussion contains forward-looking statements, which are based on assumptions about the future of the Company’s business. The actual results could differ materially from those contained in the forward-looking statements. Please read “Forward-Looking Statements” included below for additional information regarding forward-looking statements.

 

Forward-Looking Statements

 

This report contains, in addition to historical information, certain information, assumptions and discussions that may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We have made these statements in reliance on the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are subject to certain risks and uncertainties, which could cause actual results to differ materially from those projected or anticipated. Although we believe our assumptions underlying our forward-looking statements are reasonable as of the date of this report, we cannot assure you that the forward-looking statements set out in this report will prove to be accurate. We typically identify these forward-looking statements by the use of forward-looking words such as “expect,” “potential,” “continue,” “may,” “will,” “should,” “could,” “would,” “seek,” “intend,” “plan,” “estimate,” “anticipate” or the negative version of those words or other comparable words. Forward-looking statements contained in this report include, but are not limited to, statements about:

 

 

whether we can obtain approval from the U.S. Food and Drug Administration, or FDA, and foreign regulatory bodies, to commence our clinical studies and to sell, market and distribute our therapeutics and devices under development;

     
 

our ability to successfully initiate and complete clinical trials of our pharmaceutical candidates under development, including our oral and topical Endoxifen (an active metabolite of Tamoxifen) and our intraductal technologies to administer therapeutics, including our study using fulvestrant;

     
 

the success, cost and timing of our product and drug development activities and clinical trials, including whether the ongoing clinical study using our intraductal technologies to administer fulvestrant and our study using our oral Endoxifen in the window of opportunity prior to surgery will enroll a sufficient number of subjects or be completed in a timely fashion or at all;

     
 

whether we will successfully complete our clinical study of topical Endoxifen to reduce mammographic breast density and whether the study will fail to achieve its objective, including because some participants have discontinued the study prior to completing the full six months of dosing because of skin irritation issues or for other reasons;

     
 

our ability to contract with third-party suppliers, manufacturers and service providers, including clinical research organizations, and their ability to perform adequately;

     
 

our ability to successfully develop and commercialize new therapeutics currently in development or that we might identify in the future and in the time frames currently expected;

     
 

our ability to successfully defend litigation and other similar complaints that may be brought in the future, in a timely manner and within the coverage, scope and limits of our insurance policies;

     
 

our ability to establish and maintain intellectual property rights covering our products;

     
 

our expectations regarding, and our ability to satisfy, federal, state and foreign regulatory requirements;

     
 

the accuracy of our estimates of the size and characteristics of the markets that our products and services may address;

     
 

whether the final study results will vary from preliminary study results that we may announce;

     
 

our expectations as to future financial performance, expense levels and capital sources;

     
 

our ability to attract and retain key personnel; and

     
 

our ability to raise capital.

 

13

 

 

These and other forward-looking statements made in this report are presented as of the date on which the statements are made. We have included important factors in the cautionary statements included in this report, particularly in the section titled “ITEM 1A. RISK FACTORS,” that we believe could cause actual results or events to differ materially from the anticipated results as set forth in the forward-looking statements that we make. Our forward-looking statements do not reflect the potential impact of any new information, future events or circumstances that may affect our business after the date of this report. Except as required by law, we do not intend to update any forward-looking statements after the date on which the statement is made, whether as a result of new information, future events or circumstances or otherwise.

 

Company Overview

 

We are a clinical-stage biopharmaceutical company focused on developing novel, proprietary therapeutics and delivery methods for the treatment of breast cancer and other breast conditions. Our lead program is the development of Endoxifen, which is an active metabolite of tamoxifen, an FDA-approved drug to treat and prevent breast cancer. We are developing an oral and topical form of Endoxifen. Our Endoxifen is being developed to potentially treat a number of conditions, including: mammographic breast density (or, MBD); breast cancer in the “window of opportunity” between diagnosis of breast cancer and surgery; gynecomastia, which is male breast enlargement; and the recurrence of breast cancer in patients who do not benefit from taking tamoxifen meaning that they are “refractory” to tamoxifen. We are also developing our patented intraductal delivery technology to potentially target the delivery of therapies, including fulvestrant, immunotherapies and Chimeric Antigen Receptor T-cell therapies (CAR-T therapies), directly to the site of breast cancer.

 

In 2017, we completed a Phase 1 placebo-controlled clinical study of our proprietary oral and topical formulations of Endoxifen in 48 healthy women. All objectives were met: there were no clinically significant safety signals and no clinically significant adverse events, and both the oral and topical Endoxifen were well tolerated. In the topical arm of the study, low but measurable Endoxifen levels were detected in the blood in a dose-dependent fashion. In the oral arm of the study, participants exhibited dose-dependent Endoxifen levels that met or exceeded the published therapeutic level. The median time for patients in the study to reach the steady-state serum levels of Endoxifen while taking daily doses of oral Endoxifen was 7 days. Published literature indicates that it takes approximately 50-200 days for patients to reach steady-state Endoxifen levels from daily doses of oral tamoxifen. In September 2018, we completed a Phase 1 placebo-controlled clinical study of our proprietary topical Endoxifen in 24 healthy men. All of our objectives of safety, tolerability and pharmacokinetics were successfully met.

 

We are currently conducting two Phase 2 studies of our proprietary Endoxifen: one in Stockholm, Sweden using our topical Endoxifen for reduction of MBD and another in Australia using our oral Endoxifen for patients in the window of opportunity between diagnosis of breast cancer and surgery. In October 2018, the MBD study in Sweden was fully-enrolled with all 90 participants:  60 participants on two different dose levels and 30 participants on placebo. Dosing in this study was completed in April 2019 and we expect to report preliminary results in the second quarter 2019.

 

In December 2018, we began providing our oral Endoxifen to a pre-menopausal, estrogen-receptor positive (ER+), lacking CYP2D6 function, breast cancer patient under an FDA-approved "expanded access" program. The purpose of this therapeutic approach was to reduce activity of the cancer cells prior to surgery. The patient received daily doses of our oral Endoxifen for approximately three weeks prior to surgery. There were no safety or tolerability issues and her surgery was successfully completed. The cancer cell biological activity was reduced, based on the estrogen receptor activity of the tumor cells and a 50% reduction in Ki-67. The FDA has also approved use of our Endoxifen for this patient following her surgery, under the FDA expanded access IND program, the use of our proprietary oral Endoxifen is restricted solely to this patient.

 

We are currently conducting a Phase 2 study at Montefiore Medical Center, Bronx, New York, using our intraductal technology to deliver fulvestrant directly to the site of the tumor via the breast ducts. Our program to use our intraductal technology to deliver CAR-T and other immunotherapies is in the pre-clinical phase.

 

 

Research and Development Phase

 

We are in the research and development phase and are not currently marketing any products or services. We do not anticipate generating revenue unless and until we develop and launch our pharmaceutical programs.

 

Commercial Lease Agreements 

 

On November 1, 2018, the Company entered into an operating lease to pay $3,660 monthly rent for a term of 22 months with WW 107 Spring Street LLC to lease office space at 107 Spring Street, Seattle, Washington.

 

14

 

 

Critical Accounting Policies and Estimates

 

Our management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States, or GAAP. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities and expenses. On an ongoing basis, we evaluate these estimates and judgments, including those described below. We base our estimates on our historical experience and on various other assumptions that we believe to be reasonable under the circumstances. These estimates and assumptions form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results and experiences may differ materially from these estimates.

 

Significant changes to our accounting policies as a result of adopting ASC Topic 842 are discussed in Note 11 of the notes to our unaudited condensed consolidated financial statements. There were no other changes in our significant accounting policies and estimates during the three months ended March 31, 2019, from those set forth in “Note 3, Summary of Accounting Policies” in our Annual Report on Form 10-K for the year ended December 31, 2018. We believe that the following accounting policies are the most critical to aid you in fully understanding and evaluating our reported financial results and affect the more significant judgments and estimates that we use in the preparation of our financial statements.

 

Share-Based Payments

 

We follow the provisions of ASC 718, Compensation – Stock Compensation, which requires the measurement and recognition of compensation expense for all share-based payment awards made to employees, non-employee directors, and consultants, including employee stock options. Stock compensation expense based on the grant date’s fair value was estimated in accordance with the provisions of ASC 718 and is recognized as an expense over the requisite service period with forfeitures recognized when they occur.

 

The fair value of each option grant is estimated using the Black-Scholes option-pricing model, which requires assumptions regarding the expected volatility of our stock options, the expected life of the options, an expectation regarding future dividends on our common stock, and estimation of an appropriate risk-free interest rate. Our expected common stock price volatility assumption is based upon the volatility of our stock price. The expected life assumption for stock option grants was based upon the simplified method provided for under ASC 718-10, which averages the contractual term of the options of ten years with the average vesting term of one to four years. The dividend yield assumption of zero is based upon the fact that we have never paid cash dividends and presently have no intention of paying cash dividends in the future. The risk-free interest rate used for each grant was based upon prevailing short-term interest rates over the expected life of the options.

 

Results of Operations

 

Comparison of the three months ended March 31, 2019 and 2018

 

Revenue and Cost of Revenue: For the three months ended March 31, 2019 and 2018, we have no source of sustainable revenue and no associated cost of revenue.

 

Operating Expenses: Total operating expenses were approximately $4,064,000 for the three months ended March 31, 2019, which is an increase of approximately $2,190,000 or 117%, from the three months ended March 31, 2018. Operating expenses for 2019 consisted of research and development (R&D) expenses of approximately $1,451,000 and general and administrative (G&A) expenses of approximately $2,613,000. Operating expenses for 2018 consisted of R&D expenses of approximately $471,000, and G&A expenses of approximately $1,403,000.

    

Research and Development Expenses: R&D expenses for the three months ended March 31, 2019, were approximately $1,451,000, an increase of approximately $980,000 or 208% from total R&D expenses for the three months ended March 31, 2018 of approximately $471,000. The increase in R&D expense is attributed to salaries, stock-based compensation, and clinical trial expenses associated with our Endoxifen program. Stock-based compensation expense increased approximately $668,000 in 2019 resulting from the cancellation of stock options. There were no Liability Option cancellations in the comparable period in 2018. We expect our R&D expenses to increase throughout 2019 as we commence additional Phase 2 clinical studies of Endoxifen, continue the clinical trial of Fulvestrant administered via our intraductal technology and continue the development of other indications and therapeutics, including CAR-T and immunotherapies administered via our intraductal technologies.

 

General and Administrative Expenses: G&A expenses were approximately $2,613,000 for the three months ended March 31, 2019, an increase of approximately $1,210,000, or 86% from the total G&A expenses for the three months ended March 31, 2018, of approximately $1,403,000. G&A expenses consist primarily of personnel and related benefit costs, facilities, professional services, insurance, and public company related expenses. The increase in G&A expenses for the quarter ended March 31, 2019, is mainly attributed to an increase in stock-based compensation expense due to the cancellation of the 2018 Liability Options of approximately $1,074,000, payroll expenses resulting from salary increases, and increased legal and professional consulting expenses over the prior year.

   

Income taxes: We have incurred net operating losses from inception; we did not record an income tax benefit for our incurred losses for the three months ended March 31, 2019 and 2018, due to uncertainty regarding utilization of our net operating carryforwards and due to our history of losses.

 

15

 

 

 

Liquidity and Capital Resources

 

The Company has incurred net losses and negative operating cash flows since inception. For the three months ended March 31, 2019, the Company recorded a net loss of approximately $4.1 million and used approximately $2.1 million of cash in operating activities. As of March 31, 2019, the Company had approximately $19.6 million in cash and cash equivalents and working capital of approximately $19.3 million. The Company has not yet established an ongoing source of revenue sufficient to cover its operating costs and is currently expending funds in research and development activities that are expected to continue to require funding. Management believes the currently available funding will be sufficient to finance the Company’s operations for at least one year from the date of these Condensed Consolidated Financial Statements. However, the Company will likely require additional funding to continue its activities beyond that date. If adequate funds are not available, the Company may be required to reduce the scope, delay, or eliminate some or all of its planned commercial activities. The accompanying condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the settlement of liabilities in the normal course of business. The condensed consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from uncertainty related to the Company’s ability to continue as a going concern.

  

Cash Flows

 

As of March 31, 2019, we had cash, cash equivalents and restricted cash of approximately $19.7 million.

 

Net Cash Flows from Operating Activities: Net cash used in operating activities was approximately $2,149,000 for the three months ended March 31, 2019, a decrease of approximately $238,000, or 10%, compared to net cash used in operating activities for the three months ended March 31, 2018 of approximately $2,387,000. The decrease in the 2019 period as compared to 2018 resulted primarily from decreased spending on R&D activities.

  

Net Cash Flows from Financing Activities: Net cash provided by financing activities was approximately $11,337,000 for the three months ended March 31, 2019, which represents proceeds from the exercise of warrants issued in the May 2018 financing. There were no comparable warrant exercises or financing activities for the three months ended March 31, 2018.

 

Funding Requirements

 

We expect to incur ongoing operating losses for the foreseeable future as we continue to develop our planned therapeutic programs including related clinical studies and other programs in the pipeline. We expect that our current available funding will be sufficient to fund our planned operations for at least the next 12 to 18 months from the date of this report. If we meet certain requirements, we may sell securities that are registered on our Form S-3 registration statement, and by raising capital through sales of securities to third parties and existing stockholders. If we are unable to raise additional capital when needed, however, we could be forced to curtail or cease operations. Our future capital uses and requirements will depend on the time and expenses needed to begin and continue clinical trials for our new drug developments.

 

Additional funding may not be available to us on acceptable terms or at all. In addition, the terms of any financing may adversely affect the holdings or the rights of our stockholders. For example, if we raise additional funds by issuing equity securities or by selling debt securities, if convertible, further dilution to our existing stockholders would result. To the extent our capital resources are insufficient to meet our future capital requirements, we will need to finance our future cash needs through public or private equity offerings, collaboration agreements, debt financings or licensing arrangements.

 

If adequate funds are not available, we may be required to terminate, significantly modify or delay our development programs, reduce our planned commercialization efforts, or obtain funds through collaborators that may require us to relinquish rights to our technologies or product candidates that we might otherwise seek to develop or commercialize independently. Further, we may elect to raise additional funds even before we need them if we believe the conditions for raising capital are favorable.

 

 

16

 

 

Off-Balance Sheet Arrangements

 

We do not currently have, nor have we ever had, any relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities, established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes. In addition, we do not engage in trading activities involving non-exchange traded contracts.

 

Recently Adopted Accounting Pronouncements:

 

In the first quarter of 2019, we adopted Accounting Standards Update (“ASU”) No. 2016-02, Lease Accounting Topic 842: ("Topic 842") and recognized on our Condensed Consolidated Balance Sheet $101,000 of lease liabilities with corresponding right-of-use assets for operating leases. The new lease standard requires a lessee to measure its operating lease liabilities at the present value of the remaining minimum lease payments with a discounted cash flow model using the interest rate implicit in the lease. If the implicit interest rate cannot be readily determined, the lessee must use its incremental borrowing rate (“IBR”). If the lessee does not have an IBR, the lessee must use a rate that approximates the rate of interest that the lessee would have to pay to borrow on a collateralized basis over a similar term in an amount equal to the lease payments in a similar economic environment. The implicit interest rate was readily determinable for our copier lease; however, we used an IBR to measure our adoption date operating lease liability related to our office space which rate represents our estimated borrowing rate on a secured loan collateralized by similar assets for a similar term. The adoption did not have an impact on the Condensed Consolidated Statements of Cash Flows. As permitted under the standard, we elected prospective application of the new guidance and prior periods continue to be presented in accordance with Accounting Standards Codification ("ASC") Topic 840. Refer to our 2018 Annual Report on Form 10-K for disclosures required by Topic 840. The new standard provides a number of optional practical expedients in transition. We elected the practical expedients to not reassess its prior conclusions about lease identification under the new standard, to not reassess lease classification, to not separate lease and non lease components and to not reassess initial direct costs. We did not elect the practical expedient allowing the use-of-hindsight which would require us to reassess the lease term of its leases based on all facts and circumstances through the effective date and did not elect the practical expedient pertaining to land easements as this is not applicable to our current contract portfolio. See Note 11, Commitments and Contingencies, of the notes to our unaudited condensed consolidated financial statements for additional discussion of our leases and the amounts recognized in these unaudited condensed consolidated financial statements.

 

On January 1, 2019, we adopted ASU 2018-08, Not-for-Profit Entities (Topic 958): Clarifying the Scope and the Accounting Guidance for Contributions Received and Contributions Made. This ASU affects not-for-profit entities and business entities that receive or make contributions of cash. The ASU clarifies and improves the scope and accounting guidance to assist entities in evaluating if those transactions should be accounted for as contributions under the scope of Topic 958 or as an exchange transaction subject to other guidance. The adoption did not have any impact on the financial statements.

 

Recent Accounting Pronouncements: 

 

In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement, to improve the effectiveness of disclosures. The amendments remove, modify, and add certain disclosure requirements in Topic 820, “Fair Value Measurement.” The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. The amendments are effective for fiscal years beginning after December 15, 2019. Early adoption is permitted, including adoption in an interim period. Furthermore, an entity is permitted to early adopt any removed or modified disclosures upon issuance of the update and delay adoption of the additional disclosures until their effective date. We do not expect this amendment to have a material impact on our consolidated financial statements.

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

 

Not applicable.

 

ITEM 4. CONTROLS AND PROCEDURES.

 

Our management, with the participation of our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures as of March 31, 2019. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (“Exchange Act”), means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Our principal executive officer and principal financial officer concluded that, as of March 31, 2019, the Company’s disclosure controls and procedures were not effective at the reasonable assurance level.

 

No change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) occurred during the quarter ended March 31, 2019, that has materially affected, or is reasonably likely to materially affect our disclosure controls and procedures

 

For the quarter ended June 30, 2018, we identified a material weakness in the internal controls over the calculation of the deemed dividend on Series B convertible preferred stock (the “deemed dividend”) for the three and six months June 30, 2018. Because of this error, an incorrect deemed dividend was included in net loss applicable to common stockholders which caused an incorrect calculation of loss per common share, basic and diluted. Management misinterpreted the technical guidance contained in ASC 470- Debt in calculating the deemed dividend. An appropriately detailed knowledge of ASC 470 -Debt was not present to prevent or detect this error. We incorrectly stated the amount of the deemed dividend as $4,782,100, rather than $11,479,308, for the three and six months ended June 30, 2018. We also incorrectly stated the loss per common share - basic and diluted, for the three and six months ended June 30, 2018 as $(2.90) and $(3.77) respectively, rather than the correct amount of $(5.08) and $(6.11), respectively. The condensed consolidated financial statements for the three and six months period ended June 30, 3018 were restated to correct the error.

 

Management’s remediation plan is to enhance the procedures performed to independently review technical accounting memorandums for accuracy and completeness including when appropriate with an outside independent accounting firm in future periods.

 

17

 

 

PART II OTHER INFORMATION

 

ITEM 1. LEGAL PROCEEDINGS 

 

Litigation and Contingencies

 

We are subject to legal proceedings and claims that arise in the normal course of business. We believe these matters are either without merit or of a kind that should not have a material effect, individually or in the aggregate, on our financial position, results of operations or cash flows.

 

ITEM 1A. RISK FACTORS

 

There have been no material changes to the risk factors described in our Annual Report on Form 10-K, as filed with the SEC on March 25, 2019.

 

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

Not applicable.

 

 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

 

Not applicable.

 

ITEM 4. MINE SAFETY DISCLOSURES

 

Not applicable.

 

ITEM 5. OTHER INFORMATION

 

Not applicable.

 

 

18

 

 

ITEM 6. EXHIBITS

 

(a)

Exhibits

 

 

 

 

 

Incorporated by
Reference Herein

 

 

Exhibit No.

 

Description

 

Form

 

Date

             
4.1   Form of 2019 Option Award Agreement   Current Report on Form 8-K, as Exhibit 4.1   January 15, 2019

4.2

 

2010 Stock Option and Incentive Plan, as amended January 13, 2019

 

Current Report on Form 8K, as Exhibit 4.2

 

January 15, 2019

31.1

 

Certification pursuant to Rule 13a-14(a) under the securities Exchange Act of 1934 of Steven C. Quay

 

Filed herewith

 

 

31.2

 

Certification pursuant to Rule 13a-14(a) under the securities Exchange Act of 1934 of Kyle Guse

 

Filed herewith

 

 

32.1

 

Certification pursuant to 18 U.S.C. Section 1350 of Steven C. Quay

 

Filed herewith

 

 

32.2

 

Certification pursuant to 18 U.S.C. Section 1350 of Kyle Guse

 

Filed herewith

 

 

 

 

 

 

 

 

 

101

 

Interactive Data Files pursuant to Rule 405 of Regulation S-T

 

Filed herewith

 

 

 

19

 

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

Date: May 13, 2019

 

/s/ Steven C. Quay

 

President and Chief Executive Officer

 

(On behalf of the Registrant)

 

 

/s/ Kyle Guse

 

Kyle Guse

 

Chief Financial Officer, General Counsel and Secretary

 

(As Principal Financial and Accounting Officer)

 

 

EX-31.1 2 ex_141347.htm EXHIBIT 31.1 ex_141347.htm

Exhibit 31.1

 

CERTIFICATION PURSUANT TO RULE 13a-14(a)

OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED

AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Steven C. Quay, certify that:

 

1.     I have reviewed this Quarterly Report of Atossa Genetics Inc.;

 

2.     Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3.     Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, statements of stockholders' equity and cash flows of the registrant as of, and for, the periods presented in this report;

 

4.     The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

(a)   designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

(b)   designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

(c)   evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

(d)   disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5.     The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):

 

(a)   all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

(b)   any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

 

Date: May 13, 2019

 

 

 

/s/ Steven C. Quay

 

Steven C. Quay

 

Chief Executive Officer and President

 

(Principal executive officer)

 

 

EX-31.2 3 ex_141348.htm EXHIBIT 31.2 ex_141348.htm

 

Exhibit 31.2

 

CERTIFICATION PURSUANT TO RULE 13a-14(a)

OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED

AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Kyle Guse, certify that:

 

1.     I have reviewed this Quarterly Report of Atossa Genetics Inc.;

 

2.     Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3.     Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, statement of stockholders' equity and cash flows of the registrant as of, and for, the periods presented in this report;

 

4.     The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

(a)   designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

(b)   designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

(c)   evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

(d)   disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5.     The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):

 

(a)   all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

(b)   any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

 

Date: May 13, 2019

 

 

 

/s/Kyle Guse

 

Kyle Guse

 

Chief Financial Officer, General Counsel and Secretary

 

(Principal financial and accounting officer)

 

EX-32.1 4 ex_141349.htm EXHIBIT 32.1 ex_141349.htm

 

Exhibit 32.1

 

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Quarterly Report of Atossa Genetics Inc. (the “Company”) on Form 10-Q for the period ending March 31, 2019 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Steven C. Quay, Chief Executive Officer and President of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:

 

(1)   The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

(2)   The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

 

Date: May 13, 2019

 

 

 

/s/ Steven C. Quay

 

Steven C. Quay

 

Chief Executive Officer and President

 

(Principal executive officer)

 

EX-32.2 5 ex_141350.htm EXHIBIT 32.2 ex_141350.htm

 

Exhibit 32.2

 

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Quarterly Report of Atossa Genetics Inc. (the “Company”) on Form 10-Q for the period ending March 31, 2019 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Kyle Guse, Chief Financial Officer, General Counsel and Secretary of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:

 

(1)   The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

(2)   The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

 

Date: May 13, 2019

 

 

 

/s/ Kyle Guse

 

Kyle Guse

 

Chief Financial Officer, General Counsel and Secretary

 

(Principal financial and accounting officer)

 

 

 

 

 

EX-101.INS 6 atos-20190331.xml XBRL INSTANCE DOCUMENT 3151944 3151944 3151944 19852 19852 2800000 35000 38000 -280242 37595 185000000 13624 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">NOTE <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4:</div> PREPAID EXPENSES</div></div> <div style=" margin: 0pt 7.5pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">Prepaid expenses consisted of the following:</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div> <table border="0" cellpadding="0" cellspacing="0" style="; text-indent: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; min-width: 700px;"> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div><div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">March 31,</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div><div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">December 31,</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid; background-color: rgb(255, 255, 255);"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div><div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">2019</div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid; background-color: rgb(255, 255, 255);"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div><div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">2018</div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="width: 70%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Prepaid insurance</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">234,875</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">160,576</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Prepaid research and development</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">392,894</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">218,090</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Professional services</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">96,250</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">110,094</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Financial exchange fees</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">58,685</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">&nbsp;</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Prepaid rent</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">17,100</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">&nbsp;</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Retainer and security deposits</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">14,218</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">16,718</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Other</div> </td> <td style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">21,446</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4,355</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; margin-left: 9pt;">Total prepaid expenses</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">835,468</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">509,833</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> </table> </div></div> 58685 12300000 96250 110094 3151944 0.435 392894 218090 238000 203000 237856 518098 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">NOTE <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">5:</div> RESEARCH AND DEVELOPMENT TAX REBATE RECEIVABLE</div></div> <div style=" margin: 0pt 7.5pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> May 23, 2017, </div>Atossa formed a wholly-owned subsidiary in Australia called Atossa Genetics AUS Pty Ltd. The purpose of this subsidiary is to perform research and development activities (&#x201c;R&amp;D&#x201d;) including our Phase <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1</div> and Phase <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2</div> Endoxifen clinical trials. Australia offers an R&amp;D cash rebate of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$0.435</div> per dollar spent on qualified R&amp;D activities incurred in the country. For the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div> months ended <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 31, 2019 </div>and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2018,</div> the Company incurred qualified R&amp;D expenses of approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$80,000</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$86,000,</div> respectively. The Company recorded a rebate receivable of approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$35,000</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$38,000</div> for the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div> months ended <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 31, 2019 </div>and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2018,</div> respectively and a corresponding credit to R&amp;D expenses. At <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 31, 2019, </div>we had a total R&amp;D rebate receivable of approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$238,000</div> that includes approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$203,000</div> receivable remaining from the year ended <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December 31, 2018.&nbsp;</div></div></div> 2502 2871 4128 5463 7257 12623 106076 233862 374782 P10Y 2800000 2799188 503854 10832856 11336710 19300000 false --12-31 Q1 2019 2019-03-31 10-Q 0001488039 9124732 Yes false Non-accelerated Filer ATOSSA GENETICS INC true atos <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">NOTE <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">6:</div> PAYROLL LIABILITIES</div></div> <div style=" margin: 0pt 7.5pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">Payroll liabilities consisted of the following:</div> <div style=" margin: 0pt 7.5pt; text-align: left; text-indent: 36pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div> <table border="0" cellpadding="0" cellspacing="0" style="; text-indent: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; min-width: 700px;"> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid; background-color: rgb(255, 255, 255);"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div><div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">March 31, 2019</div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid; background-color: rgb(255, 255, 255);"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div><div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">December 31, 2018</div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="width: 70%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Accrued bonuses</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">646,433</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">697,995</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Accrued vacation</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">162,619</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">160,740</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Accrued payroll</div> </td> <td style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">82,706</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">76,335</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Total payroll liabilities</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">891,758</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">935,070</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> </table> </div> <div style=" margin: 0pt 7.5pt; text-align: left; text-indent: 36pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div></div> 463970 353328 646433 697995 74844 177074 82706 76335 162619 160740 98056781 82204902 701999 2378997 215139 215139 275833 275833 275833 215139 1741919 224676 166701 51157 48438 275833 215139 1074183 667736 783383 14473 458994 3369468 76235 4611845 90708 21024728 11720446 20779528 11549366 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">Basis of Presentation:</div></div> <div style=" margin: 0pt 7.5pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (&#x201c;GAAP&#x201d;) for interim financial information and with the instructions to Form <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10</div>-Q and Rule <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">01</div> of Regulation S-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">X.</div> They do <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> include all information and notes required by GAAP for complete financial statements. However, except as disclosed herein, there has been <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">no</div> material change in the information disclosed in the Notes to Consolidated Financial Statements included in the Annual Report on Form <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10</div>-K of the Company for the year ended <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December 31, 2018.</div></div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">In the opinion of management, all adjustments (including normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div> months ended <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 31, 2019, </div>are <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> necessarily indicative of the results that <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may </div>be expected for the year ending <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December 31, 2019.</div></div></div></div></div></div></div> <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">NOTE <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3:</div> SUMMARY OF ACCOUNTING POLICIES</div></div> <div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">Basis of Presentation:</div></div> <div style=" margin: 0pt 7.5pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (&#x201c;GAAP&#x201d;) for interim financial information and with the instructions to Form <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10</div>-Q and Rule <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">01</div> of Regulation S-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">X.</div> They do <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> include all information and notes required by GAAP for complete financial statements. However, except as disclosed herein, there has been <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">no</div> material change in the information disclosed in the Notes to Consolidated Financial Statements included in the Annual Report on Form <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10</div>-K of the Company for the year ended <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December 31, 2018.</div></div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">In the opinion of management, all adjustments (including normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div> months ended <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 31, 2019, </div>are <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> necessarily indicative of the results that <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may </div>be expected for the year ending <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December 31, 2019.</div></div> <div style=" margin: 0pt 7.5pt; text-align: left; text-indent: 36pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;&nbsp;</div> <div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">Use of Estimates:</div></div> <div style=" margin: 0pt 7.5pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates.</div> <div style=" margin: 0pt 7.5pt; text-align: left; text-indent: 36pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"></div> <div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">Recently&nbsp;Adopted Accounting Pronouncements:</div></div> <div style=" margin: 0pt 7.5pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">In the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">first</div> quarter of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2019,</div> we adopted Accounting Standards Update (&#x201c;ASU&#x201d;) <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">No.</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">02,</div> <div style="display: inline; font-style: italic;">Lease Accounting</div> Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">842</div><div style="display: inline; font-style: italic;">:&nbsp;("</div>Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">842</div><div style="display: inline; font-style: italic;">")</div>&nbsp;and recognized on our Condensed Consolidated&nbsp;Balance Sheet&nbsp;<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$101,000</div> of lease liabilities with corresponding right-of-use assets for operating leases. The new lease standard requires a lessee to measure its operating lease liabilities at the present value of the remaining minimum lease payments with a discounted cash flow model using the interest rate implicit in the lease. If the implicit interest rate cannot be readily determined, the lessee must use its incremental borrowing rate (&#x201c;IBR&#x201d;). If the lessee does <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> have an IBR, the lessee must use a rate that approximates the rate of interest that the lessee would have to pay to borrow on a collateralized basis over a similar term in an amount equal to the lease payments in a similar economic environment. The implicit interest rate was readily determinable for our copier lease; however, we used an IBR to measure our adoption date operating lease liability related to our office space which rate represents our estimated borrowing rate on a secured loan collateralized by similar assets for a similar term. The adoption did <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> have an impact on the Condensed Consolidated Statements of Cash Flows. As permitted under the standard, we elected prospective application of the new guidance and prior periods continue to be presented in accordance with Accounting Standards Codification ("ASC")&nbsp;Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">840.</div> Refer to our <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2018</div> Annual Report on Form <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10</div>-K for disclosures required by Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">840.</div> The new standard provides a number of optional&nbsp;practical expedients&nbsp;in transition. We elected the&nbsp;practical expedients&nbsp;to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> reassess its prior conclusions about lease identification under the new standard, to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> reassess lease classification, and to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> reassess initial direct costs. We did <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> elect the practical expedient allowing the&nbsp;use-of-hindsight&nbsp;which would require us to reassess the lease term of its leases based on all facts and circumstances through the effective date and did <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> elect the practical expedient pertaining to land easements as this is <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> applicable to our current contract portfolio. See Note <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">11,</div> <div style="display: inline; font-style: italic;">Commitments and Contingencies,</div> of the notes to our unaudited condensed consolidated financial statements for additional discussion of our leases and the amounts recognized in these unaudited condensed consolidated financial statements.</div> <div style=" margin: 0pt; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January 1, 2019, </div>we adopted ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2018</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">08,</div> <div style="display: inline; font-style: italic;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">Not</div>-for-Profit Entities (Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">958</div>): Clarifying the Scope and the Accounting Guidance for Contributions Received and Contributions Made.</div> This ASU affects <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div>-for-profit entities and business entities that receive or make contributions of cash.&nbsp;The ASU&#xfeff; clarifies and improves the scope and accounting guidance to assist entities in evaluating if those transactions should be accounted for as contributions under the scope of Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">958</div> or as an exchange transaction subject to other guidance.&nbsp;The adoption did <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> have any impact on&nbsp;the financial statements.</div> <div style=" margin: 0pt 7.2pt; text-align: left; text-indent: 36pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt 14.4pt; text-align: left; text-indent: -18pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">Recent Accounting Pronouncements:</div>&nbsp;</div> <div style=" margin: 0pt 14.4pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt 7.2pt 0pt -2pt; text-align: justify; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> August 2018, </div>the FASB issued ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">No.</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2018</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">13,</div> <div style="display: inline; font-style: italic;">Fair Value Measurement (Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">820</div>): Disclosure Framework&#x2014;Changes to the Disclosure Requirements for Fair Value Measurement</div>, to improve the effectiveness of disclosures. The amendments remove, modify, and add certain disclosure requirements in Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">820,</div> &#x201c;Fair Value Measurement.&#x201d; The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3</div> fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. The amendments are effective for fiscal years beginning after <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December 15, 2019. </div>Early adoption is permitted, including adoption in an interim period. Furthermore, an entity is permitted to early adopt any removed or modified disclosures upon issuance of the update and delay adoption of the additional disclosures until their effective date. We do <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> expect this amendment to have a&nbsp;material&nbsp;impact on our consolidated financial statements.</div></div> 19568247 4779519 10380493 10490493 7272469 19678247 4834519 9187754 -2437950 18925000 10052000 4.05 4.05 1 3869216 1070028 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">NOTE <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">11:</div> COMMITMENTS AND CONTINGENCIES</div></div> <div style=" margin: 0pt 7.5pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></div> <div style=" margin: 0pt; text-align: justify; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">Lease Commitments</div></div> <div style=" margin: 0pt; text-align: justify; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">As discussed in Note <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3,</div> we adopted the requirements of&nbsp;ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">No.</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">02,</div> <div style="display: inline; font-style: italic;">Lease Accounting:&nbsp;</div>Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">842</div><div style="display: inline; font-style: italic;">,&nbsp;</div>and all related amendments on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January 1, 2019. </div>Prior to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January 1, 2019, </div>we accounted for leases in accordance with ASC Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">840,</div> <div style="display: inline; font-style: italic;">Leases</div>.&nbsp;In accordance with Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">842,</div> we evaluate all contractual agreements at inception to determine if they contain a lease. We measure lease liabilities at present value of lease payments <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> yet paid, using a discounted cash flow model that requires the use of a discount rate, or incremental borrowing rate.</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">Our operating lease assets&nbsp;consist of an&nbsp;office&nbsp;lease and a copier system&nbsp;lease. Our office lease expires in&nbsp;<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> August </div>of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2020</div> and our copier system lease expires in <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> October </div>of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2021.</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">None</div> of our leases contain options to extend. Total operating lease expense for the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div> months ended <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 31, 2019, </div>was approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$12,900</div> and variable lease payments of taxes and insurance were immaterial. &nbsp;As of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 31, 2019, </div>the weighted average remaining lease term&nbsp;was approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1.7</div> years and the weighted average discount rate of our operating leases was <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">12%.</div></div> <div style=" margin: 0pt 7.5pt 0pt 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt 7.5pt 0pt 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;As of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 31, 2019, </div>the future minimum lease&nbsp;payments are&nbsp;approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$44,000,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$44,000</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$12,000</div> for&nbsp;<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2019,</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2020</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2021,</div> respectively. These amounts are net of approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$12,000</div> of imputed interest. The cash paid for amounts included in the measurement of operating lease liabilities for the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div> months ended <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 31, 2019 </div>was approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$14,600.</div></div> <div style=" margin: 0pt 7.5pt 0pt 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: justify; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">Litigation and Contingencies</div></div> <div style=" margin: 0pt 7.5pt; text-align: justify; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;We are subject to legal proceedings and claims that arise in the normal course of business. We believe these matters are either without merit or of a kind that should <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> have a material effect, individually or in the aggregate, on our financial position, results of operations or cash flows.</div></div> 0.18 0.18 175000000 175000000 9122171 5846552 9122171 5846552 1641979 1052372 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">NOTE <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10:</div> CONCENTRATION OF CREDIT RISK</div></div> <div style=" margin: 0pt 7.5pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash deposits. Accounts at each institution are insured by the Federal Deposit Insurance Corporation (&#x201c;FDIC&#x201d;) up to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$250,000.</div> At <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 31, 2019 </div>and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December 31, 2018, </div>the Company had <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$18,925,000</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$10,052,000</div> in excess of the FDIC insured limit, respectively.</div></div> 1 1677 1677 476431 284 1410025 <div style="display: inline; font-family: times new roman; font-size: 10pt"><table border="0" cellpadding="0" cellspacing="0" style="; text-indent: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; min-; min-width: 700px;"> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div><div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">March 31,</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div><div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">December 31,</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid; background-color: rgb(255, 255, 255);"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div><div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">2019</div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid; background-color: rgb(255, 255, 255);"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div><div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">2018</div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="width: 70%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Prepaid insurance</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">234,875</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">160,576</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Prepaid research and development</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">392,894</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">218,090</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Professional services</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">96,250</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">110,094</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Financial exchange fees</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">58,685</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">&nbsp;</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Prepaid rent</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">17,100</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">&nbsp;</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Retainer and security deposits</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">14,218</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">16,718</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Other</div> </td> <td style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">21,446</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4,355</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; margin-left: 9pt;">Total prepaid expenses</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">835,468</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">509,833</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> </table></div> 14218 16718 13983 7864 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">NOTE <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">12:</div> STOCK BASED COMPENSATION</div></div> <div style=" margin: 0pt 7.5pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: justify; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">Stock Option and Incentive Plan</div></div> <div style=" margin: 0pt 7.5pt; text-align: justify; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: justify; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> September 28, 2010, </div>the Board of Directors approved the adoption of the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2010</div> Stock Option and Incentive Plan the (<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">&#x201c;2010</div> Plan&#x201d;) to provide for the grant of equity-based awards to employees, officers, non-employee directors and other key persons providing services to the Company. Awards of incentive options <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may </div>be granted under the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2010</div> Plan until <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> September 2020. </div><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">No</div> other awards <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may </div>be granted under the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2010</div> Plan after the date that is <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10</div> years from the date of stockholder approval. An aggregate of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">5,556</div> shares were initially reserved for issuance in connection with awards granted under the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2010</div> Plan and on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> May 18, 2016, </div>an additional <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">11,111</div> shares were reserved for issuance under the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2010</div> Plan. On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> May 9, 2018, </div>the stockholders approved an additional <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">125,000</div> shares for issuance under the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2010</div> Plan. On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> April 12, 2018, </div>the stockholders approved an additional <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">500,000</div> shares for issuance under the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2010</div> Plan.</div> <div style=" margin: 0pt; text-align: justify; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div><div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"></div> <div style=" margin: 0pt; text-align: justify; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">The following table presents the automatic additions to the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2010</div> Plan since inception pursuant to the &#x201c;evergreen&#x201d; terms of the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2010</div> Plan:</div> <div style=" margin: 0pt 7.5pt; text-align: left; text-indent: 36pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div> <table border="0" cellpadding="0" cellspacing="0" style="; text-indent: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; min-width: 700px;"> <tr style="vertical-align: bottom;"> <td style="width: 85%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: thin; border-bottom-style: solid;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><div style="display: inline; font-weight: bold;">January 1,</div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"> <div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">Number of<br /> shares</div></div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2012</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2,502</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2013</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2,871</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2014</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4,128</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2015</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">5,463</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2016</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">7,257</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2017</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">12,623</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2018</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">106,076</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2019</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">233,862</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Total additional shares</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">374,782</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> </table> </div> <div style=" margin: 0pt 7.5pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">The Company did <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div></div> grant options to purchase shares of common stock during the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div> months ended <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 31, 2019 </div>or <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2018.</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">No</div></div> options were exercised during the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div> months ended <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 31, 2019 </div>or <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2018.</div> There are <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">236,430</div> shares available for grant under the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2010</div> Plan as of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 31, 2019.</div></div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">Compensation costs associated with the Company&#x2019;s stock options are recognized, based on the grant-date fair values of these options, over the requisite service period, or vesting period. Accordingly, the Company recognized stock-based compensation expense of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$275,833</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$215,139</div> for the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div> months ended <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 31, 2019 </div>and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2018,</div> respectively (excluding the liability options discussed below).</div> <div style=" margin: 0pt 14.4pt; text-align: left; text-indent: 36pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt 14.4pt; text-align: left; text-indent: 36pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div> <table border="0" cellpadding="0" cellspacing="0" style="; text-indent: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; min-width: 700px;"> <tr style="vertical-align: bottom;"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td colspan="6" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid; background-color: rgb(255, 255, 255);"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></div><div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">Three Months Ended March 31,</div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> </tr> <tr style="vertical-align: bottom;"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid; background-color: rgb(255, 255, 255);"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div><div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">2019</div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid; background-color: rgb(255, 255, 255);"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div><div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">2018</div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="width: 70%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">General and administrative</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">224,676</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">166,701</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Research and development</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">51,157</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">48,438</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Total stock compensation Expense</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">275,833</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">215,139</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> </table> </div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">Options issued and outstanding as of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 31, 2019, </div>under the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2010</div> Plan and their activities during the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div> months then ended are as follows:</div> <div style=" margin: 0pt 7.5pt; text-align: left; text-indent: 36pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div> <table border="0" cellpadding="0" cellspacing="0" style="; text-indent: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; min-width: 700px;"> <tr style="vertical-align: bottom;"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"> <div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">Number of<br /> Underlying<br /> Shares</div></div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"> <div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">Weighted-<br /> Average<br /> Exercise Price<br /> Per Share</div></div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"> <div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">Weighted-<br /> Average<br /> Contractual<br /> Life Remaining<br /> in Years</div></div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"> <div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">Aggregate<br /> Intrinsic Value</div></div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="width: 52%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Outstanding as of January 1, 2019</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">783,383</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">12.14</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">&nbsp;</div></td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">&nbsp;</div></td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Granted</div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Forfeited</div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Expired</div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Outstanding as of March 31, 2019</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">783,383</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">12.14</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">8.92</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">695,400</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Exercisable as of March 31, 2019</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">434,515</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">19.38</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">8.84</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">374,063</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Vested and expected to vest</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">783,383</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">12.14</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">8.92</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">695,400</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> </table> </div> <div style=" margin: 0pt 7.5pt; text-align: justify; text-indent: 36pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: justify; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">At <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 31, 2019, </div>there were <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">348,868</div> unvested options outstanding and the related unrecognized total compensation cost associated with these options was approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$876,533.</div> This expense is expected to be recognized over a weighted-average period of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1.40</div> years.</div> <div style=" margin: 0pt; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;&nbsp;</div> <div style=" margin: 0pt 0pt 0pt -27pt; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2018</div> Liability Options</div></div> <div style=" margin: 0pt; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> June 27, 2018, </div>the Company granted <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2,300,000</div> options to the Chief Executive Officer (CEO) and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">700,000</div> to the Chief Financial Officer (CFO) (the "Liability Options"). Each option&nbsp;was exercisable for an equivalent number of shares of Company's common stock. The Liability&nbsp;Options were granted pursuant to an option award agreement and were granted outside the Company&#x2019;s <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2010</div> Plan; however, they&nbsp;were subject to the terms and conditions of the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2010</div> Plan. On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January 13, 2019, </div>the Liability Options were canceled.</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"></div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">The Liability&nbsp;Options were exercisable for shares of common stock at an exercise price of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$2.38</div> per share, which was the fair value on the date of grant. The options had an exercise period of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">ten</div> years from their date of issuance. If at the time the options were exercised the Company&nbsp;could <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div>&nbsp;deliver shares of common stock to the optionee including, for example, if there were insufficient shares available under the Plan at the time of exercise, then in lieu of the optionee paying the exercise price and the Company issuing shares of stock, the option only would be exercised on a cash &#x201c;net basis&#x201d; so that the Company would pay cash in an amount equal to the excess of the fair value of the common stock over the option exercise price. If there were <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> sufficient shares available under the Plan, the&nbsp;Company&nbsp;would have been obligated to settle these options in cash if they were exercised. Because these options contained provisions that would require the Company to settle the options in cash in an event outside the Company&#x2019;s control, they were accounted for as liabilities.</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">The Liability&nbsp;Options were subject to vesting requirements. Twenty-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">five</div> percent of the options were vested as of the grant date, <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">50%</div> of the options would have vested quarterly over <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">two</div> years, and the remaining <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">25%</div> would have vested upon achievement of certain milestones related to clinical trial progress. As of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January 13, 2019, </div>all of the Liability Options that vested upon achievement of clinical trial&nbsp;milestones&nbsp;were vested.&nbsp;On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January 13, 2019, </div>the Liability Options were cancelled and at the time of cancellation,&nbsp;there were <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,125,000</div> unvested Liability Options outstanding.</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">Compensation costs associated with the Liability&nbsp;Options were initially recognized, based on the grant-date fair values of these options, over the requisite or vesting period for time-based options or when it is probable the performance criteria were achieved for options that vest based on performance. Compensation cost was remeasured each period based on the market value of our underlying stock until award vesting or settlement.</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">At the time of cancellation, the fair value of Liability Options at <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January 13, 2019, </div>was calculated using the Black-Scholes option-pricing model applying the following assumptions:</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div> <table border="0" cellpadding="0" cellspacing="0" style="; text-indent: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; min-width: 700px;"> <tr style="vertical-align: bottom;"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"> <div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">January 13,</div></div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom;"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"> <div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">2019</div></div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom;"> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="width: 85%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Risk free interest rate</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2.53</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"> <div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">%</div> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Expected term (in years)</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4.50-5.00</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Stock price</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1.36</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Dividend yield</div> </td> <td style="width: 1%;">&nbsp;</td> <td style="width: 1%;">&nbsp;</td> <td style="width: 12%; text-align: right;">&nbsp;</td> <td nowrap="nowrap" style="width: 1%; margin-left: 0pt;"> <div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">%</div> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Expected volatility</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">121.0-123.0</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"> <div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">%</div> </td> </tr> </table> </div> <div style=" margin: 0pt 14.7pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">As a result of the cancellation, the Company&nbsp;recognized all remaining unrecognized compensation expense related to these options of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$1,741,919,</div> which was included in the following captions in the condensed consolidated statements of operations:&nbsp;</div> <div style=" margin: 0pt 7.2pt; text-align: left; text-indent: 36pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div> <table border="0" cellpadding="0" cellspacing="0" style="; text-indent: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; min-width: 700px;"> <tr style="vertical-align: bottom;"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"> <div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">Period Ended&nbsp;March 31, 2019</div></div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom;"> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="width: 85%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">General and administrative</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,074,183</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Research and development</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">667,736</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Total stock compensation expense</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,741,919</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> </table> </div> <div style=" margin: 0pt 14.7pt; text-align: left; text-indent: 36pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">Also on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January 13, 2019, </div>at the same time the Liability Options were cancelled, the Company awarded a new option to the CEO to purchase <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2,300,000</div> shares of Common Stock and a new option to&nbsp;the&nbsp;CFO&nbsp;to purchase <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">800,000</div> shares of common stock (the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">&#x201c;2019</div> Options&#x201d;). The <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2019</div> Options: (i) have an exercise price equal to the fair market value of Common Stock on the date of board of director approval which was <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$1.36</div> per share, (ii) do <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> contain a net cash exercise provision, (iii) are awarded pursuant to the terms and conditions of the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2010</div> Plan as amended by the Board of Directors on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January 13, 2019, </div>to include shares issuable upon exercise of the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2019</div> Options and other changes to the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2010</div> Plan so that the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2019</div> Options do <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> conflict with the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2010</div> Plan (the &#x201c;Amended Plan&#x201d;), (iv) vest and are exercisable in accordance with the vesting schedule related to the&nbsp;<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2018</div> Liability&nbsp;Options; provided, however, that the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2019</div> Options are <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> exercisable unless and until the Company&#x2019;s stockholders approve the Amended Plan to increase the authorized number of shares available for grant under the Plan and&nbsp;(vi) are subject to and conditioned upon the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2019</div> Option Agreements with the optionees and the employment agreements with the optionees.</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">The above actions were unanimously approved by the disinterested members&nbsp;of the Board of Directors. The above actions are intended to eliminate the Company&#x2019;s potential liability associated with the net cash exercise provision of the liability options, and to allow the stockholders of the Company the opportunity to vote on the Amended Plan, which includes shares issuable upon exercise of the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2019</div> Options.</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt 0pt 0pt -27pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">Accounting treatment</div></div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">Awards offered under a plan that are subject to shareholder approval are <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> considered granted under GAAP&nbsp;until the approval is obtained, unless such approval is essentially a formality (or perfunctory). For example, if management and board members control&nbsp;sufficient votes to approve the plan, the vote <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may </div>be considered perfunctory. As management and the Company&#x2019;s Board of Directors do <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> control enough votes to approve the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2019</div> Options, the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2019</div> Options&nbsp;are <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> deemed granted under ASC <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">718.</div> Cancellation of an award that is <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> accompanied by the concurrent grant&nbsp;are accounted for as a repurchase for <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">no</div> consideration. Accordingly, any previously unrecognized compensation cost is recognized at the cancellation date. On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January 13, 2019, </div>as noted above, the Company recognized <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$1,741,919</div> of unrecognized compensation cost related to the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2018</div> Liability Options. Additionally, the fair value of the stock-based compensation liability of&nbsp;<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$3,151,944</div> was&nbsp;reclassified to additional-paid in capital on the cancellation date.&nbsp;If shareholder approval is obtained and a grant date is established for the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2019</div> Options, the Company will measure and&nbsp;record them as a new grant under ASC <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">718.</div></div> <div style=" margin: 0pt 0pt 0pt 7.2pt; text-align: left; text-indent: 28.8pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div></div> <div style="display: inline; font-family: times new roman; font-size: 10pt"><table border="0" cellpadding="0" cellspacing="0" style="; text-indent: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; min-; min-width: 700px;"> <tr style="vertical-align: bottom;"> <td style="width: 85%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: thin; border-bottom-style: solid;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><div style="display: inline; font-weight: bold;">January 1,</div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"> <div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">Number of<br /> shares</div></div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2012</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2,502</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2013</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2,871</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2014</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4,128</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2015</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">5,463</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2016</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">7,257</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2017</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">12,623</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2018</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">106,076</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2019</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">233,862</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Total additional shares</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">374,782</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> </table></div> -0.62 -8.48 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">NOTE <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">8:</div> NET LOSS PER SHARE</div></div> <div style=" margin: 0pt 7.5pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">The Company accounts for and discloses net loss per common share in accordance with ASC Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">260,</div> <div style="display: inline; font-style: italic;">Earnings Per Share</div>. Basic net loss per common share is computed by dividing net loss attributable to common stockholders by the weighted average number of common shares outstanding. In addition, in computing the dilutive effect of convertible securities, the numerator is adjusted to add back any convertible preferred dividends. Diluted net loss per common share is computed by dividing net loss attributable to common stockholders by the weighted average number of common shares that would have been outstanding during the period assuming the issuance of common shares for all potential dilutive common shares outstanding. Potential common shares consist of potential future exercises of outstanding stock options and common stock warrants. Because the inclusion of potential common shares would be anti-dilutive for all periods presented they have been excluded from the calculation.</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">The following table summarizes the Company&#x2019;s calculation of net loss per common share:&nbsp;</div> <div style=" margin: 0pt 7.5pt; text-align: left; text-indent: 36pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div> <table border="0" cellpadding="0" cellspacing="0" style="; text-indent: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; min-width: 700px;"> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="margin: 0px; padding: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="margin: 0px; padding: 0px; width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="6" rowspan="1" style="margin: 0px; padding: 0px; width: 1%; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-weight: bold;">Three Months Ended March 31,</div></div></div></td> <td nowrap="nowrap" style="margin: 0px; padding: 0px; width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="margin: 0px; padding-top: 0px; padding-right: 0px; padding-left: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="margin: 0px; padding: 0px 0px 1px; width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" rowspan="1" style="margin: 0px; width: 1%; text-align: center; padding-top: 0px; padding-right: 0px; padding-left: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-weight: bold;">2019</div></div></td> <td nowrap="nowrap" style="margin: 0px; padding: 0px 0px 1px; width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="margin: 0px; padding: 0px 0px 1px; width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" rowspan="1" style="margin: 0px; width: 1%; text-align: center; padding-top: 0px; padding-right: 0px; padding-left: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-weight: bold;">2018</div></div></td> <td nowrap="nowrap" style="margin: 0px; padding: 0px 0px 1px; width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="width: 70%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><div style="display: inline; font-weight: bold;">Numerator</div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Net loss attributable to common shareholders</div> </td> <td style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(4,073,307</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">)</td> <td style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(1,874,382</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">)</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><div style="display: inline; font-weight: bold;">Denominator</div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Weighted average common shares outstanding used to compute net loss per share, basic and diluted</div> </td> <td style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">6,565,514</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">220,996</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><div style="display: inline; font-weight: bold;">Net loss per share of common stock, basic and diluted: </div></div> </td> <td style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(0.62</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">)</td> <td style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(8.48</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">)</td> </tr> </table> </div> <div style=" margin: 0pt 7.5pt; text-align: left; text-indent: 36pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">The following table sets forth the number of potential common shares excluded from the calculation of net loss per diluted share for the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div> months ended <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 31, 2019 </div>and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2018</div> because including them would be anti-dilutive:&nbsp;</div> <div style=" margin: 0pt 7.5pt; text-align: left; text-indent: 36pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div> <table border="0" cellpadding="0" cellspacing="0" style="; text-indent: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; min-width: 700px;"> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td colspan="6" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid; background-color: rgb(255, 255, 255);"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></div><div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-weight: bold;">Three Months Ended March 31, </div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid; background-color: rgb(255, 255, 255);"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div><div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">2019</div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid; background-color: rgb(255, 255, 255);"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div><div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">2018</div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="width: 70%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Options to purchase common stock</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">783,383</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">14,473</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Series B convertible preferred stock</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">458,994</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">&nbsp;</div></td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Warrants to purchase common stock</div> </td> <td style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3,369,468</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">76,235</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4,611,845</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">90,708</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> </table> </div> <div style=" margin: 0pt 7.5pt 0pt 0pt; text-align: justify; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div></div> 891758 935070 P1Y146D 876533 91667 99375 2613093 1403465 1741919 -4073307 -1874382 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">NOTE <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">9:</div> INCOME TAXES</div></div> <div style=" margin: 0pt 7.5pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">Deferred income tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial reporting and tax bases of assets and liabilities and are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> expected to be realized.</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">As a result of the Company&#x2019;s cumulative losses, management has concluded that a full valuation allowance against the Company&#x2019;s net deferred tax assets is appropriate. <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"></div><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">No</div> </div>income tax liabilities existed as of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 31, 2019 </div>and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December 31, 2018, </div>due to the Company&#x2019;s continuing operating losses.</div></div> 0 0 110642 -166554 -102230 82508 -43312 -428440 -2985 -51512 -30076 7789 325635 244723 12000 44000 44000 12000 1528538 2915436 21024728 11720446 1491141 2915436 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">NOTE <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1:</div> NATURE OF OPERATIONS</div></div> <div style=" margin: 0pt 7.5pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">Atossa Genetics Inc. (the &#x201c;Company&#x201d;) was incorporated on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> April 30, 2009 </div>in the State of Delaware. The Company was formed to develop and market medical devices, laboratory tests and therapeutics to address breast health conditions. The Company&#x2019;s fiscal year ends on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December 31. </div>The Company is focused on development of its pharmaceutical and drug delivery programs.</div></div> 11336710 -51068 -2148956 -2386882 -4073307 -1874382 -1874382 -4073307 -4073307 -1874382 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">Recently&nbsp;Adopted Accounting Pronouncements:</div></div> <div style=" margin: 0pt 7.5pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">In the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">first</div> quarter of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2019,</div> we adopted Accounting Standards Update (&#x201c;ASU&#x201d;) <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">No.</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2016</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">02,</div> <div style="display: inline; font-style: italic;">Lease Accounting</div> Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">842</div><div style="display: inline; font-style: italic;">:&nbsp;("</div>Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">842</div><div style="display: inline; font-style: italic;">")</div>&nbsp;and recognized on our Condensed Consolidated&nbsp;Balance Sheet&nbsp;<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$101,000</div> of lease liabilities with corresponding right-of-use assets for operating leases. The new lease standard requires a lessee to measure its operating lease liabilities at the present value of the remaining minimum lease payments with a discounted cash flow model using the interest rate implicit in the lease. If the implicit interest rate cannot be readily determined, the lessee must use its incremental borrowing rate (&#x201c;IBR&#x201d;). If the lessee does <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> have an IBR, the lessee must use a rate that approximates the rate of interest that the lessee would have to pay to borrow on a collateralized basis over a similar term in an amount equal to the lease payments in a similar economic environment. The implicit interest rate was readily determinable for our copier lease; however, we used an IBR to measure our adoption date operating lease liability related to our office space which rate represents our estimated borrowing rate on a secured loan collateralized by similar assets for a similar term. The adoption did <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> have an impact on the Condensed Consolidated Statements of Cash Flows. As permitted under the standard, we elected prospective application of the new guidance and prior periods continue to be presented in accordance with Accounting Standards Codification ("ASC")&nbsp;Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">840.</div> Refer to our <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2018</div> Annual Report on Form <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10</div>-K for disclosures required by Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">840.</div> The new standard provides a number of optional&nbsp;practical expedients&nbsp;in transition. We elected the&nbsp;practical expedients&nbsp;to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> reassess its prior conclusions about lease identification under the new standard, to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> reassess lease classification, and to <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> reassess initial direct costs. We did <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> elect the practical expedient allowing the&nbsp;use-of-hindsight&nbsp;which would require us to reassess the lease term of its leases based on all facts and circumstances through the effective date and did <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> elect the practical expedient pertaining to land easements as this is <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> applicable to our current contract portfolio. See Note <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">11,</div> <div style="display: inline; font-style: italic;">Commitments and Contingencies,</div> of the notes to our unaudited condensed consolidated financial statements for additional discussion of our leases and the amounts recognized in these unaudited condensed consolidated financial statements.</div> <div style=" margin: 0pt; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> January 1, 2019, </div>we adopted ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2018</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">08,</div> <div style="display: inline; font-style: italic;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">Not</div>-for-Profit Entities (Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">958</div>): Clarifying the Scope and the Accounting Guidance for Contributions Received and Contributions Made.</div> This ASU affects <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div>-for-profit entities and business entities that receive or make contributions of cash.&nbsp;The ASU&#xfeff; clarifies and improves the scope and accounting guidance to assist entities in evaluating if those transactions should be accounted for as contributions under the scope of Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">958</div> or as an exchange transaction subject to other guidance.&nbsp;The adoption did <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> have any impact on&nbsp;the financial statements.</div> <div style=" margin: 0pt 7.2pt; text-align: left; text-indent: 36pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt 14.4pt; text-align: left; text-indent: -18pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">Recent Accounting Pronouncements:</div>&nbsp;</div> <div style=" margin: 0pt 14.4pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt 7.2pt 0pt -2pt; text-align: justify; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">In <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> August 2018, </div>the FASB issued ASU <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">No.</div> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2018</div>-<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">13,</div> <div style="display: inline; font-style: italic;">Fair Value Measurement (Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">820</div>): Disclosure Framework&#x2014;Changes to the Disclosure Requirements for Fair Value Measurement</div>, to improve the effectiveness of disclosures. The amendments remove, modify, and add certain disclosure requirements in Topic <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">820,</div> &#x201c;Fair Value Measurement.&#x201d; The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3</div> fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. The amendments are effective for fiscal years beginning after <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> December 15, 2019. </div>Early adoption is permitted, including adoption in an interim period. Furthermore, an entity is permitted to early adopt any removed or modified disclosures upon issuance of the update and delay adoption of the additional disclosures until their effective date. We do <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> expect this amendment to have a&nbsp;material&nbsp;impact on our consolidated financial statements.</div></div></div></div> 4064329 1874441 -4064329 -1874441 12900 101000 50706 37397 14600 101000 88103 0.12 P1Y255D 27957 30942 17218 17218 9863 39939 -8978 59 21446 4355 51068 0.001 0.001 0.001 0.001 0.001 10000000 750000 4000 25000 10000000 0 702 2379 0 702 2379 1 2 835468 509833 234875 160576 17100 11336710 48212 54487 80000 86000 1451236 470976 110000 55000 110000 110000 -80904570 -76831263 <div style="display: inline; font-family: times new roman; font-size: 10pt"><table border="0" cellpadding="0" cellspacing="0" style="; text-indent: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; min-; min-width: 700px;"> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid; background-color: rgb(255, 255, 255);"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div><div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">March 31, 2019</div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid; background-color: rgb(255, 255, 255);"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div><div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">December 31, 2018</div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="width: 70%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Accrued bonuses</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">646,433</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">697,995</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Accrued vacation</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">162,619</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">160,740</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Accrued payroll</div> </td> <td style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">82,706</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">76,335</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Total payroll liabilities</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">891,758</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">935,070</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> </table></div> <div style="display: inline; font-family: times new roman; font-size: 10pt"><table border="0" cellpadding="0" cellspacing="0" style="; text-indent: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; min-; min-width: 700px;"> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td colspan="6" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid; background-color: rgb(255, 255, 255);"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></div><div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-weight: bold;">Three Months Ended March 31, </div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid; background-color: rgb(255, 255, 255);"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div><div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">2019</div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid; background-color: rgb(255, 255, 255);"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div><div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">2018</div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="width: 70%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Options to purchase common stock</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">783,383</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">14,473</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Series B convertible preferred stock</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">458,994</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">&nbsp;</div></td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Warrants to purchase common stock</div> </td> <td style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3,369,468</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">76,235</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4,611,845</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">90,708</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> </table></div> <div style="display: inline; font-family: times new roman; font-size: 10pt"><table border="0" cellpadding="0" cellspacing="0" style="; text-indent: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; min-; min-width: 700px;"> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="margin: 0px; padding: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="margin: 0px; padding: 0px; width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="6" rowspan="1" style="margin: 0px; padding: 0px; width: 1%; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-weight: bold;">Three Months Ended March 31,</div></div></div></td> <td nowrap="nowrap" style="margin: 0px; padding: 0px; width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="margin: 0px; padding-top: 0px; padding-right: 0px; padding-left: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="margin: 0px; padding: 0px 0px 1px; width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" rowspan="1" style="margin: 0px; width: 1%; text-align: center; padding-top: 0px; padding-right: 0px; padding-left: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-weight: bold;">2019</div></div></td> <td nowrap="nowrap" style="margin: 0px; padding: 0px 0px 1px; width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="margin: 0px; padding: 0px 0px 1px; width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" rowspan="1" style="margin: 0px; width: 1%; text-align: center; padding-top: 0px; padding-right: 0px; padding-left: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-weight: bold;">2018</div></div></td> <td nowrap="nowrap" style="margin: 0px; padding: 0px 0px 1px; width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="width: 70%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><div style="display: inline; font-weight: bold;">Numerator</div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Net loss attributable to common shareholders</div> </td> <td style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(4,073,307</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">)</td> <td style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(1,874,382</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">)</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><div style="display: inline; font-weight: bold;">Denominator</div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Weighted average common shares outstanding used to compute net loss per share, basic and diluted</div> </td> <td style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">6,565,514</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">220,996</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><div style="display: inline; font-weight: bold;">Net loss per share of common stock, basic and diluted: </div></div> </td> <td style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(0.62</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">)</td> <td style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(8.48</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">)</td> </tr> </table></div> <div style="display: inline; font-family: times new roman; font-size: 10pt"><table border="0" cellpadding="0" cellspacing="0" style="; text-indent: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; min-; min-width: 700px;"> <tr style="vertical-align: bottom;"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td colspan="6" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid; background-color: rgb(255, 255, 255);"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div></div><div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">Three Months Ended March 31,</div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> </tr> <tr style="vertical-align: bottom;"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid; background-color: rgb(255, 255, 255);"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div><div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">2019</div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid; background-color: rgb(255, 255, 255);"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> </div><div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">2018</div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; background-color: rgb(255, 255, 255);">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="width: 70%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">General and administrative</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">224,676</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">166,701</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Research and development</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">51,157</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">48,438</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Total stock compensation Expense</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">275,833</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">215,139</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> </table></div><div style="display: inline; font-family: times new roman; font-size: 10pt"><table border="0" cellpadding="0" cellspacing="0" style="; text-indent: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; min-; min-width: 700px;"> <tr style="vertical-align: bottom;"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"> <div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">Period Ended&nbsp;March 31, 2019</div></div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom;"> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="width: 85%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">General and administrative</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,074,183</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Research and development</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">667,736</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Total stock compensation expense</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,741,919</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> </table></div> <div style="display: inline; font-family: times new roman; font-size: 10pt"><table border="0" cellpadding="0" cellspacing="0" style="; text-indent: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; min-; min-width: 700px;"> <tr style="vertical-align: bottom;"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"> <div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">Number of<br /> Underlying<br /> Shares</div></div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"> <div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">Weighted-<br /> Average<br /> Exercise Price<br /> Per Share</div></div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"> <div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">Weighted-<br /> Average<br /> Contractual<br /> Life Remaining<br /> in Years</div></div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"> <div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">Aggregate<br /> Intrinsic Value</div></div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="width: 52%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Outstanding as of January 1, 2019</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">783,383</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">12.14</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">&nbsp;</div></td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">&nbsp;</div></td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Granted</div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Forfeited</div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Expired</div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Outstanding as of March 31, 2019</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">783,383</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">12.14</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">8.92</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">695,400</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Exercisable as of March 31, 2019</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">434,515</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">19.38</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">8.84</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">374,063</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Vested and expected to vest</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">783,383</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">12.14</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">8.92</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 3px; border-bottom-style: double;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">695,400</div></td> <td nowrap="nowrap" style="width: 1%; padding-bottom: 3px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> </table></div> <div style="display: inline; font-family: times new roman; font-size: 10pt"><table border="0" cellpadding="0" cellspacing="0" style="; text-indent: 0px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; min-; min-width: 700px;"> <tr style="vertical-align: bottom;"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"> <div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">January 13,</div></div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom;"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom-color: rgb(0, 0, 0); border-bottom-width: 1px; border-bottom-style: solid;"> <div style=" margin: 0pt; text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-weight: bold;">2019</div></div></div></div> </td> <td style="padding-bottom: 1px; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom;"> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="width: 85%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Risk free interest rate</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2.53</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"> <div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">%</div> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Expected term (in years)</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4.50-5.00</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Stock price</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1.36</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Dividend yield</div> </td> <td style="width: 1%;">&nbsp;</td> <td style="width: 1%;">&nbsp;</td> <td style="width: 12%; text-align: right;">&nbsp;</td> <td nowrap="nowrap" style="width: 1%; margin-left: 0pt;"> <div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">%</div> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Expected volatility</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">121.0-123.0</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"> <div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">%</div> </td> </tr> </table></div> P2Y 0.0253 11111 125000 500000 5556 236430 434515 19.38 0 2300000 700000 2300000 800000 0 695400 783383 783383 12.14 12.14 695400 783383 12.14 2.38 1.36 1.36 0.25 0.5 0.25 P10Y 374063 P8Y306D 348868 1125000 P8Y335D P8Y335D 220996 220996 2379 5846552 702 9122171 476431 13624 0 0 -1676998 85753 1591246 275833 215139 19496190 8805010 477342 71887674 -65426329 6938687 477342 72082961 -67300711 5259592 2 2378997 1052372 82204902 -76831263 1 701999 1641979 98056781 -80904570 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">NOTE <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">7:</div> STOCKHOLDERS&#x2019; EQUITY</div></div> <div style=" margin: 0pt 7.5pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">The Company is authorized to issue a total of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">185,000,000</div> shares of stock consisting of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">175,000,000</div> shares of common stock, par value <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$0.18</div> per share, and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">10,000,000</div> shares of preferred stock, par value <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$0.001</div> per share. The Company has designated <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">750,000</div> shares of Series A junior participating preferred stock, par value <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$0.001</div> per share, <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">4,000</div> shares of Series A convertible preferred stock, par value <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$0.001</div> per share, and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">25,000</div> shares of Series B convertible preferred stock, par value <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$0.001</div> per share,&nbsp;through the filings of certificates of designation with the Delaware Secretary of State. <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">No</div> shares of Series A junior participating preferred stock and<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">no</div></div><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"></div> shares of Series A convertible preferred stock are issued and outstanding as of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 31, 2019.</div></div> <div style=" margin: 0pt 7.5pt; text-align: left; text-indent: 36pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2018</div> Subscription Rights Offering of Units Consisting of Series B Convertible Preferred Stock and Warrants</div></div> <div style=" margin: 0pt 7.5pt; text-align: left; text-indent: 36pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">On <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> May 30, 2018, </div>the Company completed&nbsp;a rights offering pursuant to which the Company sold an aggregate of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">13,624</div> units consisting of an aggregate of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">13,624</div> shares of Series B convertible preferred stock and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3,869,216</div> warrants, with each warrant exercisable for <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">one</div> share of common stock at an exercise price of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$4.05</div> per share (the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">&#x201c;2018</div> Warrants&#x201d;), resulting in net proceeds to the Company of approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$12.3</div> million, after deducting expenses relating to the rights offering, including dealer-manager fees and expenses, and excluding any proceeds received upon exercise of any warrants.</div> <div style=" margin: 0pt 7.5pt; text-align: left; text-indent: 36pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: justify; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">Warrants</div></div> <div style=" margin: 0pt 7.5pt; text-align: justify; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">As of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 31, 2019, </div><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,070,028</div> warrants to purchase shares of common stock were outstanding. The warrants have an exercise price of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$4.05</div> and expire on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> May 30, 2022.</div></div> <div style=" margin: 0pt 7.5pt 0pt 43.5pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">For the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div> months ended&nbsp;<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 31, 2019, </div>the Company received approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$11.3</div> million from exercises of the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2018</div> Warrants. As a result of the warrant exercises, the Company issued approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2.8</div> million warrants and issued approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2.8</div> million shares of common stock.</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">Conversion of Series B Convertible Preferred Stock</div></div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">During the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div> months ended <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 31, 2019, </div>certain holders of the Series B convertible preferred stock exercised their conversion option and converted an aggregate of&nbsp;<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1,677</div> shares into&nbsp;<div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">476,431</div> shares of the Company's common stock based on the conversion ratio of approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">284</div> shares of common stock for each share of Series B convertible preferred stock.</div></div> <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">NOTE <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2:</div> LIQUIDITY AND CAPITAL RESOURCES</div></div> <div style=" margin: 0pt 7.5pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt 7.2pt 0pt -2pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">The Company has incurred net losses and negative operating cash flows since inception. For the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div> months ended <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 31, 2019, </div>the Company recorded a net loss of approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$4.1</div> million and used approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$2.1</div> million of cash in operating activities. As of <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 31, 2019, </div>the Company had approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$19.6</div> million in cash and cash equivalents and working capital of approximately <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">$19.3</div> million. The Company has <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> yet established an ongoing source of revenue sufficient to cover its operating costs and is currently expending funds in research and development activities that are expected to continue to require funding. Management believes&nbsp;the currently available funding&nbsp;will be sufficient to finance the Company&#x2019;s operations for at least <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">one</div> year from the date of&nbsp;these Condensed Consolidated Financial Statements. However, the Company will likely require additional funding to continue its activities beyond that date. If adequate funds are <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> available, the Company <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may </div>be required to reduce the scope, delay, or eliminate some or all of its planned commercial activities. The accompanying condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the settlement of liabilities in the normal course of business. The condensed consolidated financial statements do <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">not</div> include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> may </div>result from uncertainty related to the Company&#x2019;s ability to continue as a going concern.</div></div> <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" margin: 0pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">Use of Estimates:</div></div> <div style=" margin: 0pt 7.5pt; text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</div> <div style=" margin: 0pt; text-align: left; text-indent: 27pt; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. 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Document And Entity Information - shares
3 Months Ended
Mar. 31, 2019
May 09, 2019
Document Information [Line Items]    
Entity Registrant Name ATOSSA GENETICS INC  
Entity Central Index Key 0001488039  
Trading Symbol atos  
Current Fiscal Year End Date --12-31  
Entity Filer Category Non-accelerated Filer  
Entity Current Reporting Status Yes  
Entity Emerging Growth Company false  
Entity Small Business true  
Entity Common Stock, Shares Outstanding (in shares)   9,124,732
Document Type 10-Q  
Document Period End Date Mar. 31, 2019  
Document Fiscal Year Focus 2019  
Document Fiscal Period Focus Q1  
Amendment Flag false  
XML 13 R2.htm IDEA: XBRL DOCUMENT v3.19.1
Condensed Consolidated Balance Sheets (Current Period Unaudited) - USD ($)
Mar. 31, 2019
Dec. 31, 2018
Current assets    
Cash and cash equivalents $ 19,568,247 $ 10,380,493
Restricted cash 110,000 110,000
Prepaid expenses 835,468 509,833
Research and development tax rebate receivable 237,856 518,098
Other current assets 27,957 30,942
Total current assets 20,779,528 11,549,366
Furniture and equipment, net 48,212 54,487
Intangible assets, net 91,667 99,375
Right-of-use asset 88,103
Other assets 17,218 17,218
Total Assets 21,024,728 11,720,446
Current liabilities    
Accounts payable 463,970 353,328
Accrued expenses 74,844 177,074
Payroll liabilities 891,758 935,070
Stock-based compensation liability 1,410,025
Lease liability 50,706
Other current liabilities 9,863 39,939
Total current liabilities 1,491,141 2,915,436
Long term liabilities    
Lease liability long term 37,397
Total Liabilities 1,528,538 2,915,436
Commitments and contingencies (note 11)
Stockholders' equity    
Preferred stock - $0.001 par value; 10,000,000 shares authorized; 702 and 2,379 shares issued and outstanding as of March 31, 2019 and December 31, 2018, respectively 1 2
Additional paid-in capital- Series B convertible preferred stock 701,999 2,378,997
Common stock - $0.18 par value; 175,000,000 shares authorized, and 9,122,171 and 5,846,552 shares issued and outstanding, as of March 31, 2019 and December 31, 2018, respectively 1,641,979 1,052,372
Additional paid-in capital 98,056,781 82,204,902
Accumulated deficit (80,904,570) (76,831,263)
Total Stockholders' Equity 19,496,190 8,805,010
Total Liabilities and Stockholders' Equity $ 21,024,728 $ 11,720,446
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Condensed Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - $ / shares
Mar. 31, 2019
Dec. 31, 2018
Preferred stock, par value (in dollars per share) $ 0.001 $ 0.001
Preferred stock, authorized (in shares) 10,000,000 10,000,000
Preferred stock, issued (in shares) 702 2,379
Preferred stock, outstanding (in shares) 702 2,379
Common stock, par value (in dollars per share) $ 0.18 $ 0.18
Common stock, authorized (in shares) 175,000,000 175,000,000
Common stock, issued (in shares) 9,122,171 5,846,552
Common stock, outstanding (in shares) 9,122,171 5,846,552
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Condensed Consolidated Statements of Operations (Unaudited) - USD ($)
3 Months Ended
Mar. 31, 2019
Mar. 31, 2018
Operating expenses    
Research and development $ 1,451,236 $ 470,976
General and administrative 2,613,093 1,403,465
Total operating expenses 4,064,329 1,874,441
Operating loss (4,064,329) (1,874,441)
Other income (expense) (8,978) 59
Loss before income taxes (4,073,307) (1,874,382)
Income taxes 0 0
Net loss $ (4,073,307) $ (1,874,382)
Loss per common share - basic and diluted (in dollars per share) $ (0.62) $ (8.48)
Weighted average shares outstanding - basic and diluted (in shares) 6,565,514 220,996
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Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($)
Preferred Stock [Member]
Series B Convertible Preferred Stock [Member]
Preferred Stock Additional Paid-in Capital [Member]
Series B Convertible Preferred Stock [Member]
Common Stock [Member]
Common Stock Additional Paid-in Capital [Member]
Retained Earnings [Member]
Total
Balance (in shares) at Dec. 31, 2017   220,996      
Balance at Dec. 31, 2017 $ 477,342 $ 71,887,674 $ (65,426,329) $ 6,938,687
Amortization of commitment shares (19,852) (19,852)
Compensation cost for stock options granted 215,139 215,139
Net loss (1,874,382) (1,874,382)
Balance (in shares) at Mar. 31, 2018   220,996      
Balance at Mar. 31, 2018 $ 477,342 72,082,961 (67,300,711) 5,259,592
Balance (in shares) at Dec. 31, 2018 2,379   5,846,552      
Balance at Dec. 31, 2018 $ 2 2,378,997 $ 1,052,372 82,204,902 (76,831,263) 8,805,010
Amortization of commitment shares          
Compensation cost for stock options granted 275,833 275,833
Net loss (4,073,307) $ (4,073,307)
Issuance of common stock upon warrant exercise (in shares)   2,799,188     2,800,000
Issuance of common stock upon warrant exercise $ 503,854 10,832,856 $ 11,336,710
Conversion of Series B convertible preferred stock to common stock (in shares) (1,677)          
Conversion of Series B convertible preferred stock to common stock $ (1)          
Conversion of Series B convertible preferred stock to common stock   (1,676,998) $ 85,753 1,591,246
Conversion of Series B convertible preferred stock to common stock (in shares)     476,431      
Reclassification of stock-based liability awards to equity upon cancellation 3,151,944 3,151,944
Balance (in shares) at Mar. 31, 2019 702   9,122,171      
Balance at Mar. 31, 2019 $ 1 $ 701,999 $ 1,641,979 $ 98,056,781 $ (80,904,570) $ 19,496,190
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Condensed Consolidated Statements of Cash Flows (Unaudied) - USD ($)
3 Months Ended
Mar. 31, 2019
Mar. 31, 2018
CASH FLOWS FROM OPERATING ACTIVITIES    
Net loss $ (4,073,307) $ (1,874,382)
Adjustments to reconcile net loss to net cash used in operating activities    
Compensation cost for stock options granted 275,833 215,139
Depreciation and amortization 13,983 7,864
Change in fair value of stock-based compensation liability 1,741,919
Changes in operating assets and liabilities:    
Prepaid expenses (325,635) (244,723)
Research and development tax rebate receivable 280,242 (37,595)
Other assets 2,985 51,512
Accounts payable 110,642 (166,554)
Payroll liabilities (43,312) (428,440)
Accrued expenses (102,230) 82,508
Other current liabilities (30,076) 7,789
Net cash used in operating activities (2,148,956) (2,386,882)
CASH FLOWS FROM INVESTING ACTIVITY    
Purchase of furniture and equipment (51,068)
Net cash used in investing activities (51,068)
CASH FLOWS FROM FINANCING ACTIVITY    
Proceeds from exercise of warrants 11,336,710
Net cash provided by financing activities 11,336,710
NET INCREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH 9,187,754 (2,437,950)
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING BALANCE 10,490,493 7,272,469
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, ENDING BALANCE 19,678,247 4,834,519
SUPPLEMENTAL DISCLOSURES    
Cash and cash equivalents 19,568,247 4,779,519
Restricted cash 110,000 55,000
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, ENDING BALANCE 19,678,247 4,834,519
NONCASH INVESTING AND FINANCING ACTIVITIES    
Reclassification of stock-based liability awards to equity upon cancellation 3,151,944
Amortization of commitment shares $ 19,852
XML 18 R7.htm IDEA: XBRL DOCUMENT v3.19.1
Note 1 - Nature of Operations
3 Months Ended
Mar. 31, 2019
Notes to Financial Statements  
Nature of Operations [Text Block]
NOTE
1:
NATURE OF OPERATIONS
 
Atossa Genetics Inc. (the “Company”) was incorporated on
April 30, 2009
in the State of Delaware. The Company was formed to develop and market medical devices, laboratory tests and therapeutics to address breast health conditions. The Company’s fiscal year ends on
December 31.
The Company is focused on development of its pharmaceutical and drug delivery programs.
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Note 2 - Liquidity and Capital Resources
3 Months Ended
Mar. 31, 2019
Notes to Financial Statements  
Substantial Doubt about Going Concern [Text Block]
NOTE
2:
LIQUIDITY AND CAPITAL RESOURCES
 
The Company has incurred net losses and negative operating cash flows since inception. For the
three
months ended
March 31, 2019,
the Company recorded a net loss of approximately
$4.1
million and used approximately
$2.1
million of cash in operating activities. As of
March 31, 2019,
the Company had approximately
$19.6
million in cash and cash equivalents and working capital of approximately
$19.3
million. The Company has
not
yet established an ongoing source of revenue sufficient to cover its operating costs and is currently expending funds in research and development activities that are expected to continue to require funding. Management believes the currently available funding will be sufficient to finance the Company’s operations for at least
one
year from the date of these Condensed Consolidated Financial Statements. However, the Company will likely require additional funding to continue its activities beyond that date. If adequate funds are
not
available, the Company
may
be required to reduce the scope, delay, or eliminate some or all of its planned commercial activities. The accompanying condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the settlement of liabilities in the normal course of business. The condensed consolidated financial statements do
not
include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that
may
result from uncertainty related to the Company’s ability to continue as a going concern.
XML 20 R9.htm IDEA: XBRL DOCUMENT v3.19.1
Note 3 - Summary of Accounting Policies
3 Months Ended
Mar. 31, 2019
Notes to Financial Statements  
Basis of Presentation and Significant Accounting Policies [Text Block]
NOTE
3:
SUMMARY OF ACCOUNTING POLICIES
 
Basis of Presentation:
 
The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Form
10
-Q and Rule
10
-
01
of Regulation S-
X.
They do
not
include all information and notes required by GAAP for complete financial statements. However, except as disclosed herein, there has been
no
material change in the information disclosed in the Notes to Consolidated Financial Statements included in the Annual Report on Form
10
-K of the Company for the year ended
December 31, 2018.
 
In the opinion of management, all adjustments (including normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the
three
months ended
March 31, 2019,
are
not
necessarily indicative of the results that
may
be expected for the year ending
December 31, 2019.
  
Use of Estimates:
 
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates.
 
Recently Adopted Accounting Pronouncements:
 
In the
first
quarter of
2019,
we adopted Accounting Standards Update (“ASU”)
No.
2016
-
02,
Lease Accounting
Topic
842
: ("
Topic
842
")
 and recognized on our Condensed Consolidated Balance Sheet 
$101,000
of lease liabilities with corresponding right-of-use assets for operating leases. The new lease standard requires a lessee to measure its operating lease liabilities at the present value of the remaining minimum lease payments with a discounted cash flow model using the interest rate implicit in the lease. If the implicit interest rate cannot be readily determined, the lessee must use its incremental borrowing rate (“IBR”). If the lessee does
not
have an IBR, the lessee must use a rate that approximates the rate of interest that the lessee would have to pay to borrow on a collateralized basis over a similar term in an amount equal to the lease payments in a similar economic environment. The implicit interest rate was readily determinable for our copier lease; however, we used an IBR to measure our adoption date operating lease liability related to our office space which rate represents our estimated borrowing rate on a secured loan collateralized by similar assets for a similar term. The adoption did
not
have an impact on the Condensed Consolidated Statements of Cash Flows. As permitted under the standard, we elected prospective application of the new guidance and prior periods continue to be presented in accordance with Accounting Standards Codification ("ASC") Topic
840.
Refer to our
2018
Annual Report on Form
10
-K for disclosures required by Topic
840.
The new standard provides a number of optional practical expedients in transition. We elected the practical expedients to
not
reassess its prior conclusions about lease identification under the new standard, to
not
reassess lease classification, and to
not
reassess initial direct costs. We did
not
elect the practical expedient allowing the use-of-hindsight which would require us to reassess the lease term of its leases based on all facts and circumstances through the effective date and did
not
elect the practical expedient pertaining to land easements as this is
not
applicable to our current contract portfolio. See Note
11,
Commitments and Contingencies,
of the notes to our unaudited condensed consolidated financial statements for additional discussion of our leases and the amounts recognized in these unaudited condensed consolidated financial statements.
 
On
January 1, 2019,
we adopted ASU
2018
-
08,
Not
-for-Profit Entities (Topic
958
): Clarifying the Scope and the Accounting Guidance for Contributions Received and Contributions Made.
This ASU affects
not
-for-profit entities and business entities that receive or make contributions of cash. The ASU clarifies and improves the scope and accounting guidance to assist entities in evaluating if those transactions should be accounted for as contributions under the scope of Topic
958
or as an exchange transaction subject to other guidance. The adoption did
not
have any impact on the financial statements.
 
Recent Accounting Pronouncements:
 
 
In
August 2018,
the FASB issued ASU
No.
2018
-
13,
Fair Value Measurement (Topic
820
): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement
, to improve the effectiveness of disclosures. The amendments remove, modify, and add certain disclosure requirements in Topic
820,
“Fair Value Measurement.” The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level
3
fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. The amendments are effective for fiscal years beginning after
December 15, 2019.
Early adoption is permitted, including adoption in an interim period. Furthermore, an entity is permitted to early adopt any removed or modified disclosures upon issuance of the update and delay adoption of the additional disclosures until their effective date. We do
not
expect this amendment to have a material impact on our consolidated financial statements.
XML 21 R10.htm IDEA: XBRL DOCUMENT v3.19.1
Note 4 - Prepaid Expenses
3 Months Ended
Mar. 31, 2019
Notes to Financial Statements  
Prepaid Expenses [Text Block]
NOTE
4:
PREPAID EXPENSES
 
Prepaid expenses consisted of the following:
 
   
March 31,
   
December 31,
 
   
2019
   
2018
 
Prepaid insurance
  $
234,875
    $
160,576
 
Prepaid research and development
   
392,894
     
218,090
 
Professional services
   
96,250
     
110,094
 
Financial exchange fees
   
58,685
     
 
 
Prepaid rent
   
17,100
     
 
 
Retainer and security deposits
   
14,218
     
16,718
 
Other
   
21,446
     
4,355
 
Total prepaid expenses
  $
835,468
    $
509,833
 
XML 22 R11.htm IDEA: XBRL DOCUMENT v3.19.1
Note 5 - Research and Development Tax Rebate Receivable
3 Months Ended
Mar. 31, 2019
Notes to Financial Statements  
Research and Development Tax Rebate Receivable [Text Block]
NOTE
5:
RESEARCH AND DEVELOPMENT TAX REBATE RECEIVABLE
 
On
May 23, 2017,
Atossa formed a wholly-owned subsidiary in Australia called Atossa Genetics AUS Pty Ltd. The purpose of this subsidiary is to perform research and development activities (“R&D”) including our Phase
1
and Phase
2
Endoxifen clinical trials. Australia offers an R&D cash rebate of
$0.435
per dollar spent on qualified R&D activities incurred in the country. For the
three
months ended
March 31, 2019
and
2018,
the Company incurred qualified R&D expenses of approximately
$80,000
and
$86,000,
respectively. The Company recorded a rebate receivable of approximately
$35,000
and
$38,000
for the
three
months ended
March 31, 2019
and
2018,
respectively and a corresponding credit to R&D expenses. At
March 31, 2019,
we had a total R&D rebate receivable of approximately
$238,000
that includes approximately
$203,000
receivable remaining from the year ended
December 31, 2018. 
XML 23 R12.htm IDEA: XBRL DOCUMENT v3.19.1
Note 6 - Payroll Liabilities
3 Months Ended
Mar. 31, 2019
Notes to Financial Statements  
Accounts Payable, Accrued Liabilities, and Other Liabilities Disclosure, Current [Text Block]
NOTE
6:
PAYROLL LIABILITIES
 
Payroll liabilities consisted of the following:
 
   
March 31, 2019
   
December 31, 2018
 
Accrued bonuses
  $
646,433
    $
697,995
 
Accrued vacation
   
162,619
     
160,740
 
Accrued payroll
   
82,706
     
76,335
 
Total payroll liabilities
  $
891,758
    $
935,070
 
 
XML 24 R13.htm IDEA: XBRL DOCUMENT v3.19.1
Note 7 - Stockholders' Equity
3 Months Ended
Mar. 31, 2019
Notes to Financial Statements  
Stockholders' Equity Note Disclosure [Text Block]
NOTE
7:
STOCKHOLDERS’ EQUITY
 
The Company is authorized to issue a total of
185,000,000
shares of stock consisting of
175,000,000
shares of common stock, par value
$0.18
per share, and
10,000,000
shares of preferred stock, par value
$0.001
per share. The Company has designated
750,000
shares of Series A junior participating preferred stock, par value
$0.001
per share,
4,000
shares of Series A convertible preferred stock, par value
$0.001
per share, and
25,000
shares of Series B convertible preferred stock, par value
$0.001
per share, through the filings of certificates of designation with the Delaware Secretary of State.
No
shares of Series A junior participating preferred stock and
no
shares of Series A convertible preferred stock are issued and outstanding as of
March 31, 2019.
 
2018
Subscription Rights Offering of Units Consisting of Series B Convertible Preferred Stock and Warrants
 
On
May 30, 2018,
the Company completed a rights offering pursuant to which the Company sold an aggregate of
13,624
units consisting of an aggregate of
13,624
shares of Series B convertible preferred stock and
3,869,216
warrants, with each warrant exercisable for
one
share of common stock at an exercise price of
$4.05
per share (the
“2018
Warrants”), resulting in net proceeds to the Company of approximately
$12.3
million, after deducting expenses relating to the rights offering, including dealer-manager fees and expenses, and excluding any proceeds received upon exercise of any warrants.
 
Warrants
 
As of
March 31, 2019,
1,070,028
warrants to purchase shares of common stock were outstanding. The warrants have an exercise price of
$4.05
and expire on
May 30, 2022.
 
For the
three
months ended 
March 31, 2019,
the Company received approximately
$11.3
million from exercises of the
2018
Warrants. As a result of the warrant exercises, the Company issued approximately
2.8
million warrants and issued approximately
2.8
million shares of common stock.
 
Conversion of Series B Convertible Preferred Stock
 
During the
three
months ended
March 31, 2019,
certain holders of the Series B convertible preferred stock exercised their conversion option and converted an aggregate of 
1,677
shares into 
476,431
shares of the Company's common stock based on the conversion ratio of approximately
284
shares of common stock for each share of Series B convertible preferred stock.
XML 25 R14.htm IDEA: XBRL DOCUMENT v3.19.1
Note 8 - Net Loss Per Share
3 Months Ended
Mar. 31, 2019
Notes to Financial Statements  
Earnings Per Share [Text Block]
NOTE
8:
NET LOSS PER SHARE
 
The Company accounts for and discloses net loss per common share in accordance with ASC Topic
260,
Earnings Per Share
. Basic net loss per common share is computed by dividing net loss attributable to common stockholders by the weighted average number of common shares outstanding. In addition, in computing the dilutive effect of convertible securities, the numerator is adjusted to add back any convertible preferred dividends. Diluted net loss per common share is computed by dividing net loss attributable to common stockholders by the weighted average number of common shares that would have been outstanding during the period assuming the issuance of common shares for all potential dilutive common shares outstanding. Potential common shares consist of potential future exercises of outstanding stock options and common stock warrants. Because the inclusion of potential common shares would be anti-dilutive for all periods presented they have been excluded from the calculation.
 
The following table summarizes the Company’s calculation of net loss per common share: 
 
   
Three Months Ended March 31,
 
   
2019
   
2018
 
Numerator
 
 
 
 
 
 
 
 
Net loss attributable to common shareholders
  $
(4,073,307
)   $
(1,874,382
)
Denominator
 
 
 
 
 
 
 
 
Weighted average common shares outstanding used to compute net loss per share, basic and diluted
   
6,565,514
     
220,996
 
Net loss per share of common stock, basic and diluted:
  $
(0.62
)   $
(8.48
)
 
The following table sets forth the number of potential common shares excluded from the calculation of net loss per diluted share for the
three
months ended
March 31, 2019
and
2018
because including them would be anti-dilutive: 
 
   
Three Months Ended March 31,
 
   
2019
   
2018
 
Options to purchase common stock
   
783,383
     
14,473
 
Series B convertible preferred stock
   
458,994
     
 
 
Warrants to purchase common stock
   
3,369,468
     
76,235
 
     
4,611,845
     
90,708
 
 
XML 26 R15.htm IDEA: XBRL DOCUMENT v3.19.1
Note 9 - Income Taxes
3 Months Ended
Mar. 31, 2019
Notes to Financial Statements  
Income Tax Disclosure [Text Block]
NOTE
9:
INCOME TAXES
 
Deferred income tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial reporting and tax bases of assets and liabilities and are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are
not
expected to be realized.
 
As a result of the Company’s cumulative losses, management has concluded that a full valuation allowance against the Company’s net deferred tax assets is appropriate.
No
income tax liabilities existed as of
March 31, 2019
and
December 31, 2018,
due to the Company’s continuing operating losses.
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Note 10 - Concentration of Credit Risk
3 Months Ended
Mar. 31, 2019
Notes to Financial Statements  
Concentration Risk Disclosure [Text Block]
NOTE
10:
CONCENTRATION OF CREDIT RISK
 
Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash deposits. Accounts at each institution are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to
$250,000.
At
March 31, 2019
and
December 31, 2018,
the Company had
$18,925,000
and
$10,052,000
in excess of the FDIC insured limit, respectively.
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Note 11 - Commitments and Contingencies
3 Months Ended
Mar. 31, 2019
Notes to Financial Statements  
Commitments and Contingencies Disclosure [Text Block]
NOTE
11:
COMMITMENTS AND CONTINGENCIES
 
Lease Commitments
 
As discussed in Note
3,
we adopted the requirements of ASU
No.
2016
-
02,
Lease Accounting: 
Topic
842
and all related amendments on
January 1, 2019.
Prior to
January 1, 2019,
we accounted for leases in accordance with ASC Topic
840,
Leases
. In accordance with Topic
842,
we evaluate all contractual agreements at inception to determine if they contain a lease. We measure lease liabilities at present value of lease payments
not
yet paid, using a discounted cash flow model that requires the use of a discount rate, or incremental borrowing rate.
 
Our operating lease assets consist of an office lease and a copier system lease. Our office lease expires in 
August
of
2020
and our copier system lease expires in
October
of
2021.
None
of our leases contain options to extend. Total operating lease expense for the
three
months ended
March 31, 2019,
was approximately
$12,900
and variable lease payments of taxes and insurance were immaterial.  As of
March 31, 2019,
the weighted average remaining lease term was approximately
1.7
years and the weighted average discount rate of our operating leases was
12%.
 
 As of
March 31, 2019,
the future minimum lease payments are approximately
$44,000,
$44,000
and
$12,000
for 
2019,
2020
and
2021,
respectively. These amounts are net of approximately
$12,000
of imputed interest. The cash paid for amounts included in the measurement of operating lease liabilities for the
three
months ended
March 31, 2019
was approximately
$14,600.
 
Litigation and Contingencies
 
 We are subject to legal proceedings and claims that arise in the normal course of business. We believe these matters are either without merit or of a kind that should
not
have a material effect, individually or in the aggregate, on our financial position, results of operations or cash flows.
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Note 12 - Stock Based Compensation
3 Months Ended
Mar. 31, 2019
Notes to Financial Statements  
Share-based Payment Arrangement [Text Block]
NOTE
12:
STOCK BASED COMPENSATION
 
Stock Option and Incentive Plan
 
On
September 28, 2010,
the Board of Directors approved the adoption of the
2010
Stock Option and Incentive Plan the (
“2010
Plan”) to provide for the grant of equity-based awards to employees, officers, non-employee directors and other key persons providing services to the Company. Awards of incentive options
may
be granted under the
2010
Plan until
September 2020.
No
other awards
may
be granted under the
2010
Plan after the date that is
10
years from the date of stockholder approval. An aggregate of
5,556
shares were initially reserved for issuance in connection with awards granted under the
2010
Plan and on
May 18, 2016,
an additional
11,111
shares were reserved for issuance under the
2010
Plan. On
May 9, 2018,
the stockholders approved an additional
125,000
shares for issuance under the
2010
Plan. On
April 12, 2018,
the stockholders approved an additional
500,000
shares for issuance under the
2010
Plan.
 
The following table presents the automatic additions to the
2010
Plan since inception pursuant to the “evergreen” terms of the
2010
Plan:
 
January 1,
 
Number of
shares
 
2012
   
2,502
 
2013
   
2,871
 
2014
   
4,128
 
2015
   
5,463
 
2016
   
7,257
 
2017
   
12,623
 
2018
   
106,076
 
2019
   
233,862
 
Total additional shares
   
374,782
 
 
 
The Company did
not
grant options to purchase shares of common stock during the
three
months ended
March 31, 2019
or
2018.
No
options were exercised during the
three
months ended
March 31, 2019
or
2018.
There are
236,430
shares available for grant under the
2010
Plan as of
March 31, 2019.
 
Compensation costs associated with the Company’s stock options are recognized, based on the grant-date fair values of these options, over the requisite service period, or vesting period. Accordingly, the Company recognized stock-based compensation expense of
$275,833
and
$215,139
for the
three
months ended
March 31, 2019
and
2018,
respectively (excluding the liability options discussed below).
 
 
   
Three Months Ended March 31,
 
   
2019
   
2018
 
General and administrative
  $
224,676
    $
166,701
 
Research and development
   
51,157
     
48,438
 
Total stock compensation Expense
  $
275,833
    $
215,139
 
 
 
Options issued and outstanding as of
March 31, 2019,
under the
2010
Plan and their activities during the
three
months then ended are as follows:
 
   
Number of
Underlying
Shares
   
Weighted-
Average
Exercise Price
Per Share
   
Weighted-
Average
Contractual
Life Remaining
in Years
   
Aggregate
Intrinsic Value
 
Outstanding as of January 1, 2019
   
783,383
    $
12.14
     
 
     
 
 
Granted
                               
Forfeited
                               
Expired
                               
Outstanding as of March 31, 2019
   
783,383
     
12.14
     
8.92
    $
695,400
 
Exercisable as of March 31, 2019
   
434,515
     
19.38
     
8.84
    $
374,063
 
Vested and expected to vest
   
783,383
    $
12.14
     
8.92
    $
695,400
 
 
At
March 31, 2019,
there were
348,868
unvested options outstanding and the related unrecognized total compensation cost associated with these options was approximately
$876,533.
This expense is expected to be recognized over a weighted-average period of
1.40
years.
  
2018
Liability Options
 
On
June 27, 2018,
the Company granted
2,300,000
options to the Chief Executive Officer (CEO) and
700,000
to the Chief Financial Officer (CFO) (the "Liability Options"). Each option was exercisable for an equivalent number of shares of Company's common stock. The Liability Options were granted pursuant to an option award agreement and were granted outside the Company’s
2010
Plan; however, they were subject to the terms and conditions of the
2010
Plan. On
January 13, 2019,
the Liability Options were canceled.
 
The Liability Options were exercisable for shares of common stock at an exercise price of
$2.38
per share, which was the fair value on the date of grant. The options had an exercise period of
ten
years from their date of issuance. If at the time the options were exercised the Company could
not
 deliver shares of common stock to the optionee including, for example, if there were insufficient shares available under the Plan at the time of exercise, then in lieu of the optionee paying the exercise price and the Company issuing shares of stock, the option only would be exercised on a cash “net basis” so that the Company would pay cash in an amount equal to the excess of the fair value of the common stock over the option exercise price. If there were
not
sufficient shares available under the Plan, the Company would have been obligated to settle these options in cash if they were exercised. Because these options contained provisions that would require the Company to settle the options in cash in an event outside the Company’s control, they were accounted for as liabilities.
 
The Liability Options were subject to vesting requirements. Twenty-
five
percent of the options were vested as of the grant date,
50%
of the options would have vested quarterly over
two
years, and the remaining
25%
would have vested upon achievement of certain milestones related to clinical trial progress. As of
January 13, 2019,
all of the Liability Options that vested upon achievement of clinical trial milestones were vested. On
January 13, 2019,
the Liability Options were cancelled and at the time of cancellation, there were
1,125,000
unvested Liability Options outstanding.
 
Compensation costs associated with the Liability Options were initially recognized, based on the grant-date fair values of these options, over the requisite or vesting period for time-based options or when it is probable the performance criteria were achieved for options that vest based on performance. Compensation cost was remeasured each period based on the market value of our underlying stock until award vesting or settlement.
  
At the time of cancellation, the fair value of Liability Options at
January 13, 2019,
was calculated using the Black-Scholes option-pricing model applying the following assumptions:
 
   
January 13,
 
   
2019
 
         
Risk free interest rate
   
2.53
%
Expected term (in years)
   
4.50-5.00
 
Stock price
  $
1.36
 
Dividend yield
     
%
Expected volatility
   
121.0-123.0
%
 
As a result of the cancellation, the Company recognized all remaining unrecognized compensation expense related to these options of
$1,741,919,
which was included in the following captions in the condensed consolidated statements of operations: 
 
   
Period Ended March 31, 2019
 
         
General and administrative
  $
1,074,183
 
Research and development
   
667,736
 
Total stock compensation expense
  $
1,741,919
 
 
Also on
January 13, 2019,
at the same time the Liability Options were cancelled, the Company awarded a new option to the CEO to purchase
2,300,000
shares of Common Stock and a new option to the CFO to purchase
800,000
shares of common stock (the
“2019
Options”). The
2019
Options: (i) have an exercise price equal to the fair market value of Common Stock on the date of board of director approval which was
$1.36
per share, (ii) do
not
contain a net cash exercise provision, (iii) are awarded pursuant to the terms and conditions of the
2010
Plan as amended by the Board of Directors on
January 13, 2019,
to include shares issuable upon exercise of the
2019
Options and other changes to the
2010
Plan so that the
2019
Options do
not
conflict with the
2010
Plan (the “Amended Plan”), (iv) vest and are exercisable in accordance with the vesting schedule related to the 
2018
Liability Options; provided, however, that the
2019
Options are
not
exercisable unless and until the Company’s stockholders approve the Amended Plan to increase the authorized number of shares available for grant under the Plan and (vi) are subject to and conditioned upon the
2019
Option Agreements with the optionees and the employment agreements with the optionees.
 
The above actions were unanimously approved by the disinterested members of the Board of Directors. The above actions are intended to eliminate the Company’s potential liability associated with the net cash exercise provision of the liability options, and to allow the stockholders of the Company the opportunity to vote on the Amended Plan, which includes shares issuable upon exercise of the
2019
Options.
 
Accounting treatment
 
Awards offered under a plan that are subject to shareholder approval are
not
considered granted under GAAP until the approval is obtained, unless such approval is essentially a formality (or perfunctory). For example, if management and board members control sufficient votes to approve the plan, the vote
may
be considered perfunctory. As management and the Company’s Board of Directors do
not
control enough votes to approve the
2019
Options, the
2019
Options are
not
deemed granted under ASC
718.
Cancellation of an award that is
not
accompanied by the concurrent grant are accounted for as a repurchase for
no
consideration. Accordingly, any previously unrecognized compensation cost is recognized at the cancellation date. On
January 13, 2019,
as noted above, the Company recognized
$1,741,919
of unrecognized compensation cost related to the
2018
Liability Options. Additionally, the fair value of the stock-based compensation liability of 
$3,151,944
was reclassified to additional-paid in capital on the cancellation date. If shareholder approval is obtained and a grant date is established for the
2019
Options, the Company will measure and record them as a new grant under ASC
718.
 
XML 30 R19.htm IDEA: XBRL DOCUMENT v3.19.1
Significant Accounting Policies (Policies)
3 Months Ended
Mar. 31, 2019
Accounting Policies [Abstract]  
Basis of Accounting, Policy [Policy Text Block]
Basis of Presentation:
 
The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Form
10
-Q and Rule
10
-
01
of Regulation S-
X.
They do
not
include all information and notes required by GAAP for complete financial statements. However, except as disclosed herein, there has been
no
material change in the information disclosed in the Notes to Consolidated Financial Statements included in the Annual Report on Form
10
-K of the Company for the year ended
December 31, 2018.
 
In the opinion of management, all adjustments (including normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the
three
months ended
March 31, 2019,
are
not
necessarily indicative of the results that
may
be expected for the year ending
December 31, 2019.
Use of Estimates, Policy [Policy Text Block]
Use of Estimates:
 
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates.
New Accounting Pronouncements, Policy [Policy Text Block]
Recently Adopted Accounting Pronouncements:
 
In the
first
quarter of
2019,
we adopted Accounting Standards Update (“ASU”)
No.
2016
-
02,
Lease Accounting
Topic
842
: ("
Topic
842
")
 and recognized on our Condensed Consolidated Balance Sheet 
$101,000
of lease liabilities with corresponding right-of-use assets for operating leases. The new lease standard requires a lessee to measure its operating lease liabilities at the present value of the remaining minimum lease payments with a discounted cash flow model using the interest rate implicit in the lease. If the implicit interest rate cannot be readily determined, the lessee must use its incremental borrowing rate (“IBR”). If the lessee does
not
have an IBR, the lessee must use a rate that approximates the rate of interest that the lessee would have to pay to borrow on a collateralized basis over a similar term in an amount equal to the lease payments in a similar economic environment. The implicit interest rate was readily determinable for our copier lease; however, we used an IBR to measure our adoption date operating lease liability related to our office space which rate represents our estimated borrowing rate on a secured loan collateralized by similar assets for a similar term. The adoption did
not
have an impact on the Condensed Consolidated Statements of Cash Flows. As permitted under the standard, we elected prospective application of the new guidance and prior periods continue to be presented in accordance with Accounting Standards Codification ("ASC") Topic
840.
Refer to our
2018
Annual Report on Form
10
-K for disclosures required by Topic
840.
The new standard provides a number of optional practical expedients in transition. We elected the practical expedients to
not
reassess its prior conclusions about lease identification under the new standard, to
not
reassess lease classification, and to
not
reassess initial direct costs. We did
not
elect the practical expedient allowing the use-of-hindsight which would require us to reassess the lease term of its leases based on all facts and circumstances through the effective date and did
not
elect the practical expedient pertaining to land easements as this is
not
applicable to our current contract portfolio. See Note
11,
Commitments and Contingencies,
of the notes to our unaudited condensed consolidated financial statements for additional discussion of our leases and the amounts recognized in these unaudited condensed consolidated financial statements.
 
On
January 1, 2019,
we adopted ASU
2018
-
08,
Not
-for-Profit Entities (Topic
958
): Clarifying the Scope and the Accounting Guidance for Contributions Received and Contributions Made.
This ASU affects
not
-for-profit entities and business entities that receive or make contributions of cash. The ASU clarifies and improves the scope and accounting guidance to assist entities in evaluating if those transactions should be accounted for as contributions under the scope of Topic
958
or as an exchange transaction subject to other guidance. The adoption did
not
have any impact on the financial statements.
 
Recent Accounting Pronouncements:
 
 
In
August 2018,
the FASB issued ASU
No.
2018
-
13,
Fair Value Measurement (Topic
820
): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement
, to improve the effectiveness of disclosures. The amendments remove, modify, and add certain disclosure requirements in Topic
820,
“Fair Value Measurement.” The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level
3
fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. The amendments are effective for fiscal years beginning after
December 15, 2019.
Early adoption is permitted, including adoption in an interim period. Furthermore, an entity is permitted to early adopt any removed or modified disclosures upon issuance of the update and delay adoption of the additional disclosures until their effective date. We do
not
expect this amendment to have a material impact on our consolidated financial statements.
XML 31 R20.htm IDEA: XBRL DOCUMENT v3.19.1
Note 4 - Prepaid Expenses (Tables)
3 Months Ended
Mar. 31, 2019
Notes Tables  
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Table Text Block]
   
March 31,
   
December 31,
 
   
2019
   
2018
 
Prepaid insurance
  $
234,875
    $
160,576
 
Prepaid research and development
   
392,894
     
218,090
 
Professional services
   
96,250
     
110,094
 
Financial exchange fees
   
58,685
     
 
 
Prepaid rent
   
17,100
     
 
 
Retainer and security deposits
   
14,218
     
16,718
 
Other
   
21,446
     
4,355
 
Total prepaid expenses
  $
835,468
    $
509,833
 
XML 32 R21.htm IDEA: XBRL DOCUMENT v3.19.1
Note 6 - Payroll Liabilities (Tables)
3 Months Ended
Mar. 31, 2019
Notes Tables  
Schedule of Accrued Liabilities [Table Text Block]
   
March 31, 2019
   
December 31, 2018
 
Accrued bonuses
  $
646,433
    $
697,995
 
Accrued vacation
   
162,619
     
160,740
 
Accrued payroll
   
82,706
     
76,335
 
Total payroll liabilities
  $
891,758
    $
935,070
 
XML 33 R22.htm IDEA: XBRL DOCUMENT v3.19.1
Note 8 - Net Loss Per Share (Tables)
3 Months Ended
Mar. 31, 2019
Notes Tables  
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]
   
Three Months Ended March 31,
 
   
2019
   
2018
 
Numerator
 
 
 
 
 
 
 
 
Net loss attributable to common shareholders
  $
(4,073,307
)   $
(1,874,382
)
Denominator
 
 
 
 
 
 
 
 
Weighted average common shares outstanding used to compute net loss per share, basic and diluted
   
6,565,514
     
220,996
 
Net loss per share of common stock, basic and diluted:
  $
(0.62
)   $
(8.48
)
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block]
   
Three Months Ended March 31,
 
   
2019
   
2018
 
Options to purchase common stock
   
783,383
     
14,473
 
Series B convertible preferred stock
   
458,994
     
 
 
Warrants to purchase common stock
   
3,369,468
     
76,235
 
     
4,611,845
     
90,708
 
XML 34 R23.htm IDEA: XBRL DOCUMENT v3.19.1
Note 12 - Stock Based Compensation (Tables)
3 Months Ended
Mar. 31, 2019
Notes Tables  
Disclosure of Share-based Compensation Arrangements by Share-based Payment Award [Table Text Block]
January 1,
 
Number of
shares
 
2012
   
2,502
 
2013
   
2,871
 
2014
   
4,128
 
2015
   
5,463
 
2016
   
7,257
 
2017
   
12,623
 
2018
   
106,076
 
2019
   
233,862
 
Total additional shares
   
374,782
 
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Table Text Block]
   
Three Months Ended March 31,
 
   
2019
   
2018
 
General and administrative
  $
224,676
    $
166,701
 
Research and development
   
51,157
     
48,438
 
Total stock compensation Expense
  $
275,833
    $
215,139
 
   
Period Ended March 31, 2019
 
         
General and administrative
  $
1,074,183
 
Research and development
   
667,736
 
Total stock compensation expense
  $
1,741,919
 
Share-based Payment Arrangement, Option, Activity [Table Text Block]
   
Number of
Underlying
Shares
   
Weighted-
Average
Exercise Price
Per Share
   
Weighted-
Average
Contractual
Life Remaining
in Years
   
Aggregate
Intrinsic Value
 
Outstanding as of January 1, 2019
   
783,383
    $
12.14
     
 
     
 
 
Granted
                               
Forfeited
                               
Expired
                               
Outstanding as of March 31, 2019
   
783,383
     
12.14
     
8.92
    $
695,400
 
Exercisable as of March 31, 2019
   
434,515
     
19.38
     
8.84
    $
374,063
 
Vested and expected to vest
   
783,383
    $
12.14
     
8.92
    $
695,400
 
Liability Options [Member]  
Notes Tables  
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block]
   
January 13,
 
   
2019
 
         
Risk free interest rate
   
2.53
%
Expected term (in years)
   
4.50-5.00
 
Stock price
  $
1.36
 
Dividend yield
     
%
Expected volatility
   
121.0-123.0
%
XML 35 R24.htm IDEA: XBRL DOCUMENT v3.19.1
Note 2 - Liquidity and Capital Resources (Details Textual) - USD ($)
3 Months Ended
Mar. 31, 2019
Mar. 31, 2018
Dec. 31, 2018
Net Income (Loss) Attributable to Parent, Total $ (4,073,307) $ (1,874,382)  
Net Cash Provided by (Used in) Operating Activities, Total (2,148,956) (2,386,882)  
Cash and Cash Equivalents, at Carrying Value, Ending Balance 19,568,247 $ 4,779,519 $ 10,380,493
Working Capital $ 19,300,000    
XML 36 R25.htm IDEA: XBRL DOCUMENT v3.19.1
Note 3 - Summary of Accounting Policies (Details Textual) - USD ($)
Mar. 31, 2019
Jan. 01, 2019
Dec. 31, 2018
Operating Lease, Liability, Total   $ 101,000  
Operating Lease, Right-of-Use Asset $ 88,103 $ 101,000
XML 37 R26.htm IDEA: XBRL DOCUMENT v3.19.1
Note 4 - Prepaid Expenses - Schedule of Prepaid Expenses (Details) - USD ($)
Mar. 31, 2019
Dec. 31, 2018
Prepaid insurance $ 234,875 $ 160,576
Prepaid research and development 392,894 218,090
Professional services 96,250 110,094
Financial exchange fees 58,685
Prepaid rent 17,100
Retainer and security deposits 14,218 16,718
Other 21,446 4,355
Total prepaid expenses $ 835,468 $ 509,833
XML 38 R27.htm IDEA: XBRL DOCUMENT v3.19.1
Note 5 - Research and Development Tax Rebate Receivable (Details Textual) - USD ($)
3 Months Ended
Mar. 31, 2019
Mar. 31, 2018
Dec. 31, 2018
May 23, 2017
Research and Development Expense, Total $ 1,451,236 $ 470,976    
Increase (Decrease) in Research and Development Tax Rebate Receivable (280,242) 37,595    
Research and Development Tax Rebate Receivable 237,856   $ 518,098  
Atossa Genetics AUS Pty Ltd [Member]        
Research and Development Cash Rebate per Dollar       $ 0.435
Research and Development Expense, Total 80,000 86,000    
Increase (Decrease) in Research and Development Tax Rebate Receivable 35,000 $ 38,000    
Research and Development Tax Rebate Receivable $ 238,000   $ 203,000  
XML 39 R28.htm IDEA: XBRL DOCUMENT v3.19.1
Note 6 - Payroll Liabilities - Schedule of Payroll Liabilities (Details) - USD ($)
Mar. 31, 2019
Dec. 31, 2018
Accrued bonuses $ 646,433 $ 697,995
Accrued vacation 162,619 160,740
Accrued payroll 82,706 76,335
Total payroll liabilities $ 891,758 $ 935,070
XML 40 R29.htm IDEA: XBRL DOCUMENT v3.19.1
Note 7 - Stockholders' Equity (Details Textual) - USD ($)
3 Months Ended
May 30, 2018
Mar. 31, 2019
Mar. 31, 2018
Dec. 31, 2018
Number of Shares Authorized to Issue   185,000,000    
Common Stock, Shares Authorized   175,000,000   175,000,000
Common Stock, Par or Stated Value Per Share   $ 0.18   $ 0.18
Preferred Stock, Shares Authorized   10,000,000   10,000,000
Preferred Stock, Par or Stated Value Per Share   $ 0.001   $ 0.001
Preferred Stock, Shares Issued, Total   702   2,379
Class of Warrant or Right, Outstanding   1,070,028    
Class of Warrant or Right, Exercise Price of Warrants or Rights   $ 4.05    
Proceeds from Warrant Exercises   $ 11,336,710  
Class of Warrant or Right, Exercised During Period   2,800,000    
Stock Issued During Period, Shares, Warrant Exercised   2,800,000    
Preferred Stock, Shares Outstanding, Ending Balance   702   2,379
Conversion of Series B Convertible Preferred Stock into Common Stock [Member]        
Conversion of Stock, Shares Converted   1,677    
Conversion of Stock, Shares Issued   476,431    
Convertible Preferred Stock, Shares Issued upon Conversion   284    
The 2018 Subscription Rights Offering [Member]        
Number of Units Sold 13,624      
Proceeds from Issuance of Stock units $ 12,300,000      
The 2018 Subscription Rights Offering [Member] | The 2018 Warrants [Member]        
Class of Warrant or Right, Outstanding 3,869,216      
Class of Warrant or Right, Number of Securities Called by Each Warrant or Right 1      
Class of Warrant or Right, Exercise Price of Warrants or Rights $ 4.05      
Series A Junior Participating Preferred Stock [Member]        
Preferred Stock, Shares Authorized   750,000    
Preferred Stock, Par or Stated Value Per Share   $ 0.001    
Preferred Stock, Shares Issued, Total   0    
Series A Convertible Preferred Stock [Member]        
Preferred Stock, Shares Authorized   4,000    
Preferred Stock, Par or Stated Value Per Share   $ 0.001    
Preferred Stock, Shares Outstanding, Ending Balance   0    
Series B Convertible Preferred Stock [Member]        
Preferred Stock, Shares Authorized   25,000    
Preferred Stock, Par or Stated Value Per Share   $ 0.001    
Series B Convertible Preferred Stock [Member] | The 2018 Subscription Rights Offering [Member]        
Stock Issued During Period, Shares, New Issues 13,624      
XML 41 R30.htm IDEA: XBRL DOCUMENT v3.19.1
Note 8 - Net Loss Per Share - Schedule of Earnings Per Share (Details) - USD ($)
3 Months Ended
Mar. 31, 2019
Mar. 31, 2018
Net loss attributable to common shareholders $ (4,073,307) $ (1,874,382)
Weighted average shares outstanding - basic and diluted (in shares) 6,565,514 220,996
Loss per common share - basic and diluted (in dollars per share) $ (0.62) $ (8.48)
XML 42 R31.htm IDEA: XBRL DOCUMENT v3.19.1
Note 8 - Net Loss Per Share - Schedule of Antidilutive Securities (Details) - shares
3 Months Ended
Mar. 31, 2019
Mar. 31, 2018
Number of potential common shares excluded (in shares) 4,611,845 90,708
Share-based Payment Arrangement, Option [Member]    
Number of potential common shares excluded (in shares) 783,383 14,473
Series B Convertible Preferred Stock [Member]    
Number of potential common shares excluded (in shares) 458,994
Warrant [Member]    
Number of potential common shares excluded (in shares) 3,369,468 76,235
XML 43 R32.htm IDEA: XBRL DOCUMENT v3.19.1
Note 9 - Income Taxes (Details Textual) - USD ($)
$ in Thousands
3 Months Ended
Mar. 31, 2019
Mar. 31, 2018
Income Tax Expense (Benefit), Total $ 0 $ 0
XML 44 R33.htm IDEA: XBRL DOCUMENT v3.19.1
Note 10 - Concentration of Credit Risk (Details Textual) - USD ($)
Mar. 31, 2019
Dec. 31, 2018
Cash, Uninsured Amount $ 18,925,000 $ 10,052,000
XML 45 R34.htm IDEA: XBRL DOCUMENT v3.19.1
Note 11 - Commitments and Contingencies (Details Textual)
3 Months Ended
Mar. 31, 2019
USD ($)
Operating Lease, Expense $ 12,900
Operating Lease, Weighted Average Remaining Lease Term 1 year 255 days
Operating Lease, Weighted Average Discount Rate, Percent 12.00%
Lessee, Operating Lease, Liability, Payments, Remainder of Fiscal Year $ 44,000
Lessee, Operating Lease, Liability, Payments, Due Year Two 44,000
Lessee, Operating Lease, Liability, Payments, Due Year Three 12,000
Lessee, Operating Lease, Liability, Undiscounted Excess Amount 12,000
Operating Lease, Payments $ 14,600
XML 46 R35.htm IDEA: XBRL DOCUMENT v3.19.1
Note 12 - Stock Based Compensation (Details Textual) - USD ($)
3 Months Ended
Jan. 13, 2019
Jun. 27, 2018
May 09, 2018
Apr. 12, 2018
May 18, 2016
Sep. 28, 2010
Mar. 31, 2019
Mar. 31, 2018
Adjustments to Additional Paid in Capital, Transfer of Stock-based Compensation Liability Upon Option Cancellation $ 3,151,944           $ 3,151,944  
Share-based Payment Arrangement, Option [Member]                
Share-based Payment Arrangement, Expense             $ 275,833 $ 215,139
Liability Options [Member]                
Share-based Payment Arrangement, Expense $ 1,741,919              
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares, Ending Balance 1,125,000              
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price   $ 2.38            
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period   10 years            
Liability Options [Member] | Share-based Payment Arrangement, Tranche One [Member]                
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage   25.00%            
Liability Options [Member] | Share-based Payment Arrangement, Tranche Two [Member]                
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage   50.00%            
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period   2 years            
Liability Options [Member] | Share-based Payment Arrangement, Tranche Three [Member]                
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage   25.00%            
Liability Options [Member] | Chief Executive Officer [Member]                
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross   2,300,000            
Liability Options [Member] | Chief Financial Officer [Member]                
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross   700,000            
The 2019 Options [Member[                
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price $ 1.36              
The 2019 Options [Member[ | Chief Executive Officer [Member]                
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross 2,300,000              
The 2019 Options [Member[ | Chief Financial Officer [Member]                
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross 800,000              
The 2010 Stock Option and Incentive Plan [Member]                
Share-based Compensation Arrangement by Share-based Payment Award, Period for Granting Shares           10 years    
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period               0
The 2010 Stock Option and Incentive Plan [Member] | Share-based Payment Arrangement, Option [Member]                
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized           5,556    
Share-based Compensation Arrangement by Share-based Payment Award, Number of Additional Shares Authorized     125,000 500,000 11,111      
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross             0 0
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period             0  
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant             236,430  
Share-based Payment Arrangement, Expense             $ 275,833 $ 215,139
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares, Ending Balance             348,868  
Share-based Payment Arrangement, Nonvested Award, Option, Cost Not yet Recognized, Amount             $ 876,533  
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition             1 year 146 days  
XML 47 R36.htm IDEA: XBRL DOCUMENT v3.19.1
Note 12 - Stock Based Compensation - Additional Shares Authorized (Details) - shares
3 Months Ended 12 Months Ended 87 Months Ended
Mar. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Mar. 31, 2019
The 2010 Stock Option and Incentive Plan [Member]                  
Total additional shares (in shares) 233,862 106,076 12,623 7,257 5,463 4,128 2,871 2,502 374,782
XML 48 R37.htm IDEA: XBRL DOCUMENT v3.19.1
Note 12 - Stock Based Compensation - Stock-based Compensation Expense (Details) - USD ($)
3 Months Ended
Jan. 13, 2019
Mar. 31, 2019
Mar. 31, 2018
Liability Options [Member]      
Total stock compensation expense $ 1,741,919    
Share-based Payment Arrangement, Option [Member]      
Total stock compensation expense   $ 275,833 $ 215,139
General and Administrative Expense [Member] | Liability Options [Member]      
Total stock compensation expense 1,074,183    
General and Administrative Expense [Member] | Share-based Payment Arrangement, Option [Member]      
Total stock compensation expense   224,676 166,701
Research and Development Expense [Member] | Liability Options [Member]      
Total stock compensation expense $ 667,736    
Research and Development Expense [Member] | Share-based Payment Arrangement, Option [Member]      
Total stock compensation expense   $ 51,157 $ 48,438
XML 49 R38.htm IDEA: XBRL DOCUMENT v3.19.1
Note 12 - Stock Based Compensation - Stock Option Activity (Details) - The 2010 Stock Option and Incentive Plan [Member]
3 Months Ended
Mar. 31, 2019
USD ($)
$ / shares
shares
Outstanding, shares (in shares) | shares 783,383
Outstanding, Weighted average exercise price per share (in dollars per share) | $ / shares $ 12.14
Outstanding, shares (in shares) | shares 783,383
Outstanding, Weighted average exercise price per share (in dollars per share) | $ / shares $ 12.14
Outstanding, weighted average contractual life remaining in years (Year) 8 years 335 days
Outstanding, aggreate instrinsic value | $ $ 695,400
Exercisable, shares (in shares) | shares 434,515
Exercisable, Weighted average exercise price per share (in dollars per share) | $ / shares $ 19.38
Exercisable, weighted average contractual life remaining in years (Year) 8 years 306 days
Exercisable, aggreate instrinsic value | $ $ 374,063
Vested and expected to vest, shares (in shares) | shares 783,383
Vested and expected to vest, Weighted average exercise price per share (in dollars per share) | $ / shares $ 12.14
Vested and expected to vest, weighted average contractual life remaining in years (Year) 8 years 335 days
Vested and expected to vest, aggreate instrinsic value | $ $ 695,400
XML 50 R39.htm IDEA: XBRL DOCUMENT v3.19.1
Note 12 - Stock Based Compensation - Valuation Assumptions for Liability Options (Details)
Jan. 13, 2019
$ / shares
Dividend yield
Liability Options [Member]  
Risk free interest rate 2.53%
Stock price (in dollars per share) $ 1.36
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