Liquidity, Financial Condition and Management's Plans |
12 Months Ended |
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Dec. 31, 2016 | |
| Liquidity, Financial Condition and Management's Plans [Abstract] | |
| Liquidity, Financial Condition and Management's Plans |
2. Liquidity, Financial Condition and Management’s Plans
At December 31, 2016, the Company’s principal sources of liquidity were its cash and cash equivalents and the net proceeds from the closing of the CFL Transaction (as defined in Note 11).
The Company had an accumulated deficit of approximately $47,458,000 at December 31, 2016. During the year ended December 31, 2016, the Company generated a net loss of approximately $4,109,000, used cash in operations of approximately $6,664,000, and the Company expects that it will continue to generate operating losses for the foreseeable future. At December 31, 2016, the Company had a cash balance of approximately $6,069,000. Total revenues were approximately $26,227,000 and $38,182,000 for the years ended December 31, 2016 and 2015, respectively. The Company had a working capital (deficit) of approximately $1,000,000 and $(9,199,000) at December 31, 2016 and 2015, respectively.
The Company is closely monitoring operating costs and capital requirements and has developed an operating plan for 2017. The Company has had cost reductions in the areas of its staffing levels and operating budgets. However, it does not anticipate further reduction in workforce.
On November 7, 2016, the Company consummated the issuance and sale of 1,777,417 shares of the Company’s common stock to Cosmic Forward Limited (“CFL”) at a price of $9.60 per share (“Share Issuance”). In addition, on November 7, 2016, the Company completed the purchase of 312,500 shares of its common stock at a price of $9.60 per share (“Tender Offer”). The Company received total gross proceeds of $17,063,000 from the Share Issuance, or $14,063,000 after giving effect to the payment for the 312,500 shares of common stock from the Tender Offer. The Company received approximately $9,000,000 in net proceeds from the Share Issuance, after repayment of all amounts outstanding under the Master Credit Facility and the payment of transaction-related expenses.
As discussed in Note 18, on January 18, 2017, the Company consummated the issuance and sale of 312,500 shares of the Company’s common stock to CFL at a price of $9.60 per share, for total gross proceeds of $3,000,000, or $2,800,000 after giving effect to the payment of transaction-related expenses.
Management believes that its available funds and cash flow from operations will be sufficient to meet its working capital requirements through March 2018. However, there can be no assurances that the plans and actions proposed by management will be successful, that the Company will generate anticipated revenues, or that unforeseen circumstances will not require additional funding sources in the future or effectuate plans to conserve liquidity. Future efforts to raise additional funds may not be successful or they may not be available on acceptable terms, if at all.
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