Crown Electrokinetics Corp. (
NASDAQ:
CRKN) ("Crown" or the "Company"), a leading smart glass
technology company and an expert in both designing and installing
distributed antenna systems (DAS) and constructing fiber optic
networks, today announced its year-end 2022 financial results.
Corporate Updates During and Subsequent to the Fourth
Quarter 2022
- Closed the asset acquisition of Amerigen 7, integrated
organizations, and completed rebrand to Crown Fiber Optics
- Expanded to three customers including two new large telco
infrastructure companies with estimated revenue potential up to
$100 million
- Raised $7.1 million in Q1 2023 through a combination of debt
and equity issuances
- Closed up to $100 million line of credit
- Advancing EK film production
Doug Croxall, Crown CEO and Chairman, said, “Our fourth quarter
was extremely productive setting the stage for growth opportunities
across our now two business units. With the successful acquisition
and rebranding of Amerigen 7, to Crown Fiber Optics, we have
already entered into two new agreements with leading infrastructure
solutions providers, expanding our geographic US footprint,
diversifying our revenue base, and making revenue more predictable.
We look forward to 2023 being a year of execution.”
Financial Results for the year ended December 31, 2022
compared to 12 months ended 2021 (2021 unaudited due to
nine-month stub year)
Net Loss: Net loss for the year ended
December 31, 2022, was $14.3 million which included $2.4 million of
non-cash stock-based compensation expense. This Net loss was $22.8
million lower than the $37.2 million recorded during the 12 months
ended December 31, 2021, which included $12.2 million of non-cash
compensation and $14.6 million of Other Income/expense.
Operating Expenses: Operating Expenses
were $15.1 million comprising $2.4 million of non-cash stock-based
compensation, $7.0 million of payroll expense, $2.6 million in
consulting and professional fees, and $3.1 million of operating
overhead. Excluding stock compensation expense, operating expenses
were higher by $2.7 million in 2022, compared to the same period in
2021, due to increased payroll costs $1.5 million, rent and
utilities $0.6 million and other overheads $0.7 million.
Cash Position: For the year ended December
31, 2022, the Company deployed $11.1 million of cash for
operations, $0.8 million in investments, and raised $6.6
million from financing activities with $3.1 million from equity
issuance and $3.5 million of debt. As of December 31, 2022, cash
and cash equivalents were $0.8 million.
Subsequent to December 31, 2022
Subsequent to December 31, 2022, the Company acquired specific
assets and liabilities from Amerigen 7 for cash consideration of
approximately $0.6 million.
The Company secured a Line of Credit for up to $100 million from
which it has drawn $2.0 million. A further $5.1 million of capital
was raised with $1.0 million of debt and $4.1 million coming from
warrant exercises and ATM activity.
The Company will host a conference call and audio webcast that
morning at 11:00 a.m. Eastern time featuring remarks by Doug
Croxall, Chairman & CEO and Joel Krutz, CFO.
Conference Call Information
To participate in this event, please log-on or dial-in
approximately 5 to 10 minutes before the beginning of the call.
Date: March 31, 2023Time: 11:00 a.m. EDTToll Free:
1-877-451-6152International: 1-201-389-0879Conference ID:
13737268Webcast: https://viavid.webcasts.com/starthere.jsp?ei=1605377&tp_key=348919e489
Participants may also join by using Call me™ at the link
below:
https://callme.viavid.com/viavid/?callme=true&passcode=13722237&h=true&info=company&r=true&B=6
- Participants can use Guest dial-in #s above and be answered by an
operator OR click the Call me™ link for instant telephone access to
the event. The Call me™ link will be made active 15 minutes
prior to scheduled start time.
Conference Call Replay Information
Toll-free: 1-844-512-2921International: 1-412-317-6671Replay Pin
Number: 13737268Replay:
https://viavid.webcasts.com/starthere.jsp?ei=1605377&tp_key=348919e489
About Crown Electrokinetics
Crown is a smart glass technology company and the creator of our
Smart Window Insert and an expert in both designing and installing
distributed antenna systems (DAS) and constructing fiber optic
networks.
Safe Harbor Statement:
Statements in this news release may be "forward-looking
statements". Forward-looking statements include, but are not
limited to, statements that express our intentions, beliefs,
expectations, strategies, predictions, or any other statements
relating to our future activities or other future events or
conditions. These statements are based on current expectations,
estimates and projections about our business based, in part, on
assumptions made by management. These statements are not guarantees
of future performance and involve risks, uncertainties and
assumptions that are difficult to predict. Therefore, actual
outcomes and results may, and are likely to, differ materially from
what is expressed or forecasted in forward-looking statements due
to numerous factors. Any forward-looking statements speak only as
of the date of this news release and Crown Electrokinetics
Corporation undertakes no obligation to update any forward-looking
statement to reflect events or circumstances after the date of this
news release.
This press release does not constitute a public offer of any
securities for sale. Any securities offered privately will not be
or have not been registered under the Act and may not be offered or
sold in the United States absent registration or an applicable
exemption from registration requirements.
Crown Electrokinetics
IR Email: info@crownek.com
Source: Crown
Electrokinetics: www.crownek.com
Crown Electrokinetics Corp. |
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Consolidated Balance Sheets |
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(in thousands) |
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December 31, 2022 |
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December 31, 2021 |
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ASSETS |
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Current assets: |
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Cash |
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$ |
821 |
|
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$ |
6,130 |
|
Prepaid and other current assets |
|
|
590 |
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|
|
687 |
|
Total current assets |
|
|
1,411 |
|
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|
6,817 |
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Property and equipment, net |
|
|
1,409 |
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|
|
895 |
|
Intangible assets, net |
|
|
1,598 |
|
|
|
1,761 |
|
Right of use asset |
|
|
1,842 |
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|
|
- |
|
Deferred debt issuance costs |
|
|
150 |
|
|
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- |
|
Other assets |
|
|
180 |
|
|
|
179 |
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TOTAL ASSETS |
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$ |
6,590 |
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$ |
9,652 |
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LIABILITIES AND STOCKHOLDERS’ EQUITY |
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Current liabilities: |
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Accounts payable |
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$ |
865 |
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$ |
358 |
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Accrued expenses |
|
|
621 |
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|
298 |
|
Lease liability - current portion |
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|
574 |
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- |
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Warrant liability |
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972 |
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- |
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Notes payable at fair value |
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1,654 |
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- |
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Notes payable |
|
|
8 |
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|
8 |
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Total current liabilities |
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4,694 |
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|
|
664 |
|
Lease liability |
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|
1,366 |
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|
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- |
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Total liabilities |
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6,060 |
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|
|
664 |
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Commitments and Contingencies (Note 12) |
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STOCKHOLDERS’ EQUITY: |
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Preferred stock, par value $0.0001; 50,000,000 shares authorized,
no shares outstanding |
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- |
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- |
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Series A preferred stock, par value $0.0001; 300 shares authorized,
251 shares outstanding as of December 31, 2022 and 2021 |
|
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- |
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- |
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Series B preferred stock, par value $0.0001; 1,500 shares
authorized, 1,443 shares outstanding as of December 31, 2022 and
2021 |
|
|
- |
|
|
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- |
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Series C preferred stock, par value $0.0001; 600,000 shares
authorized, 500,756 shares outstanding as of December 31, 2022 and
2021 |
|
|
- |
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- |
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Series D preferred stock, par value $0.0001; 7,000 shares
authorized, 1,058 shares issued and outstanding as of December 31,
2022; liquidation preference $1,113 as of December 31, 2022; No
shares authorized, or outstanding, and no liquidation preference as
of December 31, 2021 |
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- |
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- |
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Common stock, par value $0.0001; 800,000,000 shares authorized;
20,243,509 and 14,530,126 shares outstanding as of December 31,
2022 and 2021, respectively |
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2 |
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1 |
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Additional paid-in capital |
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88,533 |
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82,677 |
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Accumulated deficit |
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(88,005 |
) |
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(73,690 |
) |
Total stockholders' equity |
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|
530 |
|
|
|
8,988 |
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY |
|
$ |
6,590 |
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$ |
9,652 |
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Crown Electrokinetics Corp. |
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Consolidated Statements of Operations |
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(in thousands) |
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Year EndedDecember 31, 2022 |
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Nine Months EndedDecember 31, 2021 |
Operating expenses: |
|
|
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Research and development |
|
$ |
4,107 |
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|
$ |
2,496 |
|
Selling, general and administrative |
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11,001 |
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|
14,367 |
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Total operating expenses |
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15,108 |
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|
16,863 |
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Loss from operations |
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(15,108 |
) |
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(16,863 |
) |
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Other income (expense): |
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Other expense |
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(74 |
) |
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(55 |
) |
Interest expense |
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(7 |
) |
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(7 |
) |
Change in fair value of warrant liability |
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1,023 |
|
|
|
- |
|
Change in fair value of notes |
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|
(149 |
) |
|
|
- |
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Gain on extinguishment of debt |
|
|
- |
|
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|
7 |
|
Gain on forgiveness of PPP loan |
|
|
- |
|
|
|
431 |
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Total other income |
|
|
793 |
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|
|
376 |
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|
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Net loss |
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|
(14,315 |
) |
|
|
(16,487 |
) |
Cumulative dividends on Series D preferred stock |
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|
(55 |
) |
|
|
- |
|
Net loss attributable to common stockholders |
|
$ |
(14,370 |
) |
|
$ |
(16,487 |
) |
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Net loss per share attributable to common
stockholders |
|
$ |
(0.82 |
) |
|
$ |
(1.13 |
) |
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Weighted average shares outstanding, basic and
diluted: |
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17,436,174 |
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14,596,019 |
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Crown Electrokinetics Corp. |
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Consolidated Statements of Cashflows |
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(in thousands) |
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Year EndedDecember 31, 2022 |
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Nine Months EndedDecember 31, 2021 |
CASH FLOWS FROM OPERATING ACTIVITIES |
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Net loss |
|
(14,315 |
) |
|
$ |
(16,487 |
) |
Adjustments to reconcile net loss to net cash used in operating
activities: |
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Stock-based compensation |
|
2,405 |
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|
8,458 |
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Issuance of common stock to consultants |
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- |
|
|
|
244 |
|
Depreciation and amortization |
|
503 |
|
|
|
225 |
|
Loss on extinguishment of debt |
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- |
|
|
|
(7 |
) |
Gain on forgiveness of PPP loan |
|
- |
|
|
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(431 |
) |
Change in fair value of warrant liability |
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(1,023 |
) |
|
|
- |
|
Change in fair value of notes |
|
149 |
|
|
|
- |
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Loss on disposal of equipment |
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52 |
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|
|
- |
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Amortization of deferred debt issuance costs |
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73 |
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|
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- |
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Amortization of right of use assets |
|
494 |
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- |
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Changes in operating assets and liabilities: |
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Prepaid and other assets |
|
182 |
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|
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(500 |
) |
Accounts payable |
|
413 |
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(126 |
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Accrued expenses |
|
323 |
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|
|
87 |
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Lease liability |
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(396 |
) |
|
|
- |
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Net cash used in operating activities |
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(11,140 |
) |
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|
(8,537 |
) |
CASH FLOWS FROM INVESTING ACTIVITIES |
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|
Purchase of equipment |
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(751 |
) |
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(552 |
) |
Purchase of patents |
|
(61 |
) |
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(264 |
) |
Net cash used in investing activities |
|
(812 |
) |
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|
(816 |
) |
CASH FLOWS FROM FINANCING ACTIVITIES |
|
|
|
Proceeds from the issuance of common stock and warrants, net of
fees |
|
855 |
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|
|
- |
|
Proceeds from the issuance of common stock / At-the-market
offering |
|
1,295 |
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|
|
- |
|
Offering costs for the issuance of common stock / At-the-market
offering |
|
(46 |
) |
|
|
- |
|
Proceeds from issuance of senior secured convertible notes and
common stock warrants |
|
3,500 |
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|
|
- |
|
Proceeds from issuance of Series D preferred stock and warrants,
net of fees |
|
1,039 |
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|
|
- |
|
Proceeds from exercise of stock options |
|
- |
|
|
|
186 |
|
Net cash provided by financing activities |
|
6,643 |
|
|
|
186 |
|
|
|
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Net decrease in cash |
|
(5,309 |
) |
|
|
(9,167 |
) |
Cash — beginning of year |
|
6,130 |
|
|
|
15,297 |
|
Cash — end of year |
$ |
821 |
|
|
$ |
6,130 |
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|
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SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING
ACTIVITIES: |
|
|
|
Issuance of common stock warrants in connection with SLOC |
$ |
223 |
|
|
$ |
- |
|
Issuance of common stock warrants in connection with consideration
payable |
$ |
86 |
|
|
$ |
- |
|
Unpaid equipment included in accounts payable |
$ |
94 |
|
|
$ |
206 |
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SUPPLEMENTAL CASH FLOW INFORMATION |
|
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Cash paid for interest |
$ |
7 |
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$ |
6 |
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