Annual report pursuant to Section 13 and 15(d)

GOING CONCERN AND MANAGEMENT'S LIQUIDITY PLANS

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GOING CONCERN AND MANAGEMENT'S LIQUIDITY PLANS
12 Months Ended
Dec. 31, 2015
Going Concern And Management's Liquidity Plans [Abstract]  
Going Concern And Management's Liquidity Plans [Text Block]
2.
GOING CONCERN AND MANAGEMENT’S LIQUIDITY PLANS
 
The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The consolidated financial statements do not include any adjustments relating to the recoverability and classification of asset amounts or the classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The Company incurred losses of $8,278,964 and $9,063,427 during the years ended December 31, 2015 and 2014, respectively. Cash used in operating activities was $6,537,708 and $7,052,172 for the years ended December 31, 2015 and 2014, respectively. Based upon projected revenues and expenses, the Company believes that it may not have sufficient funds to operate for the next twelve months. The aforementioned factors raise substantial doubt about the Company’s ability to continue as a going concern.
 
The Company needs to raise additional capital in order to expand its business objectives. The Company funded its operations for the years ended December 31, 2015 and 2014, primarily through the sale of common stock for net proceeds of $6,331,034 and $2,446,697, respectively, and during the year ended December 31, 2014, the Company sold preferred stock for net proceeds of $5,532,877 and received $49,959 proceeds from the exercise of stock options. (See Note 16 – Stockholders’ Equity). During the years ended December 31, 2015 and 2014, the Company repaid convertible promissory notes of $50,000 and $729,022, respectively (see Note 11 – Convertible Debt Obligations), and notes payable of $100,000 and $331,019, respectively.
 
The Company presently has enough cash on hand to sustain its operations on a month to month basis. Historically, the Company has been successful in raising funds to support its capital needs. Management believes that it will be successful in obtaining additional financing; however, no assurance can be provided that the Company will be able to do so. Further, there is no assurance that these funds will be sufficient to enable the Company to attain profitable operations or continue as a going concern. To the extent that the Company is unsuccessful, the Company may need to curtail its operations and implement a plan to extend payables and reduce overhead until sufficient additional capital is raised to support further operations. There can be no assurance that such a plan will be successful. Such a plan could have a material adverse effect on the Company’s business, financial condition and results of operations, and ultimately the Company could be forced to discontinue its operations, liquidate and/or seek reorganization in bankruptcy. These financial statements do not include any adjustments that might result from the outcome of this uncertainty.