Delaware
|
3826
|
20-0982060
|
||
(State or jurisdiction of incorporation or organization)
|
(Primary Standard Industrial Classification Code Number)
|
(I.R.S. Employer Identification No.)
|
Large accelerated filer
|
o
|
Accelerated filer
|
o
|
Non-accelerated filer
|
o
|
Smaller reporting company
|
x
|
(Do not check if a smaller reporting
company)
|
Title of Each Class of Securities to be Registered
|
Amount to be
Registered
(1)
|
Proposed Maximum Offering Price Per Share
(2)
|
Proposed Maximum Aggregate Offering Price
|
Amount of Registration
Fee (3) (4)
|
||||||||||||
Shares of common stock, par value $0.001
|
774,325
|
$
|
$5.00
|
$
|
3, 871 ,625
|
$
|
443.69
|
|||||||||
Shares of common stock, par value $0.001 to be issued upon the exercise of outstanding warrants and convertible preferred stock
|
633,144
|
$
|
$5.00
|
$
|
3,165,750
|
$
|
362.79
|
|||||||||
Total shares being registered
|
1,407,469
|
$
|
7,037,345
|
$
|
806.48
|
1 | |
3 | |
12 | |
12 | |
DETERMINATION OF OFFERING PRICE | 18 |
DILUTION | 18 |
19 | |
25 | |
26 | |
28 | |
29 | |
32 | |
33 | |
33 | |
35 | |
35 | |
35 | |
36 | |
II-1
|
Shares of our common stock offered for re-sale by the selling stockholders pursuant to this prospectus
|
1,407,469
|
|
Common stock currently outstanding
|
4,302,270
|
|
Proceeds to the Company
|
We will not receive any proceeds from the resale or other disposition of the shares covered by this prospectus by any selling shareholder. We will receive net proceeds from the exercise of the warrants to purchase shares of our common stock covered by this prospectus which would total $2,221, 120 if all the warrants were exercised for cash payment.
|
|
Risk Factors
|
There are significant risks involved in investing in our Company. For a discussion of risk factors you should consider before buying our common stock see “Risk Factors” beginning on page 3
|
·
|
our supplier of required parts may cease or interrupt production or otherwise fail to supply us with an adequate supply of required parts for a number of reasons, including contractual disputes with our supplier or adverse financial developments at or affecting the supplier;
|
·
|
we have reduced control over the pricing of third party-supplied materials, and our supplier may be unable or unwilling to supply us with required materials on commercially acceptable terms, or at all;
|
·
|
we have reduced control over the timely delivery of third party-supplied materials; and
|
·
|
our supplier may be unable to develop technologically advanced products to support our growth and development of new systems.
|
·
|
the pending patent applications we have filed or to which we have exclusive rights may not result in issued patents or may take longer than we expect to result in issued patents;
|
·
|
the claims of any patents which are issued may not provide meaningful protection;
|
·
|
we may not be able to develop additional proprietary technologies that are patentable;
|
·
|
the patents licensed or issued to us or our customers may not provide a competitive advantage;
|
·
|
other companies may challenge patents licensed or issued to us or our customers;
|
·
|
patents issued to other companies may harm our ability to do business;
|
·
|
other companies may independently develop similar or alternative technologies or duplicate our technologies; and
|
·
|
other companies may design around the technologies we have licensed or developed.
|
·
|
assert claims of infringement;
|
·
|
enforce our patents;
|
·
|
protect our trade secrets or know-how; or
|
·
|
determine the enforceability, scope and validity of the proprietary rights of others.
|
·
|
trade restrictions and changes in tariffs;
|
·
|
the impact of business cycles and downturns in economies outside of the United States;
|
·
|
unexpected changes in regulatory requirements that may limit our ability to export our products or sell into particular jurisdictions;
|
·
|
import and export license requirements and restrictions;
|
·
|
difficulties in maintaining effective communications with employees and customers due to distance, language and cultural barriers;
|
·
|
disruptions in international transport or delivery;
|
·
|
difficulties in protecting our intellectual property rights, particularly in countries where the laws and practices do not protect proprietary rights to as great an extent as do the laws and practices of the United States;
|
·
|
difficulties in enforcing agreements through non-U.S. legal systems;
|
·
|
longer payment cycles and difficulties in collecting receivables; and
|
·
|
potentially adverse tax consequences.
|
1.
|
Contract 2R44AI079935-03 with the National Institutes of Health; to develop strontium-selective therapies, contract amount: $3,000,000.00, operative from 08/24/2011 - 07/31/2014, $184,954.01 paid to date, $2,815,045.99 remaining in contract.
|
2.
|
Contract 1R43GM090387-01 with the National Institutes of Health; to develop assays for carcinogens, contract amount: $200,000.00, operative from 08/06/2010 - 08/05/2012, $112,982.86 paid to date, $87,017.14 remaining in contract.
|
•
|
Functional Assays, or to what extent a drug inhibits a protein target;
|
•
|
Binding Assays, or whether a drug binds to a protein;
|
•
|
Cell Assays, such as whether a drug acts upon a cell model for a disease;
|
•
|
Ion Channel Assays, or whether a drug inhibits hERG protein, which is associated with cardiotoxicity;
|
•
|
Price of the instrument - XRpro® is priced similar to other instruments that have large monthly reagent or label costs;
|
•
|
Monthly costs - XRpro® dramatically reduces costs by eliminating the need for reagents, antibodies and labels, allowing savings of approximately $500K per month;
|
•
|
Fast -. XRpro® currently runs at a rate of 2,000,000 measurements per month;
|
•
|
Sensitive - XRpro® measures nanograms of material, which has allowed us to reduce protein consumption tenfold in some cases;
|
•
|
Precise - XRpro® has demonstrated Z-Factors, which are a common measurement of assay precision, above 0.8. This is roughly equivalent to 12 standard deviations between an assay and a blank;
|
•
|
Durable - XRpro® allows samples to be read dry, months after assay, in contrast to most competing assays which must be read wet, and shortly after the assay was run; and
|
•
|
Data Rich - XRpro® allows simultaneous on-target and cross-target functional assays, which gives an estimate of both safety and toxicity.
|
1.
|
US Patent Application 20100003697, Method and Apparatus for Measuring Analyte Transport Across Barriers
|
2.
|
US Patent Application 20090087919, Method and Apparatus for Measuring Protein Post-Translational Modification
|
3.
|
US Patent Application 20090046832, Well Plate
|
4.
|
US Patent Application 20080220441, Advanced drug development and manufacturing (jointly filed and owned with Los Alamos National Security, LLC)
|
|
Number of securities to
be
issued upon exercise of
outstanding options,
warrants
and rights
|
Weighted-average
exercise
price of outstanding
options,
warrants and rights
|
Number of securities
remaining
available for future
issuance
under equity compensation
plans
|
|||||||||
Equity compensation plans approved by security holders
|
5 55 ,445
|
3. 37
|
2,4 44 ,555
|
|||||||||
Equity compensation plans not approved by security holders
|
0
|
0
|
0
|
|||||||||
Total
|
5 55 ,445
|
3. 37
|
2,4 44 ,555
|
Quarter ended
March 31, 2012
|
Quarter ended
March 31,
2011
|
|||||||
Net cash used in operating activities
|
$ | (560,821 | ) | $ | (79,995 | ) | ||
Net cash used in investing activities
|
(14,280 | ) | (657 | ) | ||||
Net cash provided by financing activities
|
76,996 | 210,843 | ||||||
Net (decrease)/increase in cash and cash equivalents
|
$ | (498,105 | ) | $ | 130,191 |
Year ended
December 31, 2011
|
Year ended
December 31,
2010
|
|||||||
Net cash (used in)/generated by operating activities
|
$ | (1,133,606 | ) | $ | 13,329 | |||
Net cash used in investing activities
|
(56,056 | ) | (6,144 | ) | ||||
Net cash provided by financing activities
|
1,750,052 | 64,789 | ||||||
Net increase in cash and cash equivalents
|
$ | 560,390 | $ | 71,974 |
Name
|
Age
|
Office(s) Held
|
Dr. Benjamin Warner
|
43
|
President, Chief Executive Officer, Treasurer, Director
|
Edward Roffman
|
62
|
Director
|
Jeremiel Zimmerman
|
62
|
Director
|
Name and Principal Position
|
Year
|
Salary ($)
|
Bonus ($)
|
Option Awards ($)
|
Non-Equity Incentive Plan Compensation ($)
|
Nonqualified
Deferred
Compensation
Earnings ($)
|
All Other Compensation
($)
(1)(2)
|
Total ($)
|
||||||||||||||||||||||||
Dr. Benjamin Warner,
President and Chief Executive Officer, Treasurer
|
2011
2010
|
199,700
193,442
|
- | - | - | - |
24,196
28,917
|
223,896
222,359
|
||||||||||||||||||||||||
Lori Peterson
Chief Operating Officer*
|
2011
2010
|
144,000
119,641
|
- | - | - | - |
12,319
7,933
|
155,319
127,574
|
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
|
|||||||||||||||||||||||||||||||||||
OPTION AWARDS
|
STOCK AWARDS
|
||||||||||||||||||||||||||||||||||
Name
|
Number of Securities Underlying Unexercised Options
(#)
Exercisable
|
Number of Securities Underlying Unexercised Options
(#)
Unexercisable
|
Equity Incentive
Plan Awards: Number of Securities Underlying Unexercised Unearned Options
(#)
|
Option
Exercise
Price
($)
|
Option
Expiration Date
|
Number of
Shares or
Units of Stock
That Have
Not Vested
(#)
|
Market Value of Shares or Units of Stock That Have Not Vested
($)
|
Equity
Incentive
Plan Awards:
Number of
Unearned
Shares,
Units or Other
Rights That
Have
Not Vested
(#)
|
Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have
Not Vested
(#)
|
||||||||||||||||||||||||||
Dr. Benjamin Warner
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
- | ||||||||||||||||||||||||||
Lori Peterson
|
50,000
|
-
|
-
|
5.71
|
8/16
|
-
|
-
|
-
|
- | ||||||||||||||||||||||||||
220,000
|
1.10
|
2
|
2/21
|
DIRECTOR COMPENSATION*
|
|||||||||||||||||||||||||
Name
|
Fees Earned or
Paid in Cash
($)
|
Stock Awards
($)
|
Option Awards
($)
|
Non-Equity Incentive Plan Compensation
($)
|
Non-Qualified Deferred Compensation Earnings
($)
|
All
Other Compensation
($)
|
Total
($)
|
||||||||||||||||||
Dr. Benjamin Warner
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
||||||||||||||||||
Lori Peterson** |
0
|
0
|
0
|
0
|
0
|
0
|
0
|
||||||||||||||||||
Jeremiel Zimmerman
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Name and Address of Beneficial Owner (4)
|
Amount and
Nature of Beneficial Ownership
|
Percentage
of Class
Beneficially
Owned
(1)
|
||||||
Edward Roffman (2)
|
31,250
|
*
|
||||||
Dr. Benjamin Warner (3)
|
3,238,015
|
74.4
|
%
|
|||||
Jeremiel Zimmerman
|
104,000
|
2.4
|
%
|
|||||
All directors and executive officers as a group (3 persons)
|
3,3 73,265
|
77.2
|
%
|
(1)
|
Percentage of class beneficially owned is calculated by dividing the amount and nature of beneficial ownership by the total shares of common stock outstanding plus the shares subject to warrants and options that are currently exercisable or exercisable within 60 days of June 1, 2012.
|
(2)
|
On May 1, 2012, Mr. Roffman was issued options exercisable for 30,000 shares of common stock, of which 7,500 vested immediately upon grant and 1,250 vest monthly so long as he remains a director. Includes 8,750 of shares underlying such options that have already vested and 2,500 shares underlying such options that will vest within the next 60 days.
|
(3)
|
Includes 25,035 shares of Series A preferred stock which is convertible into 25,035 shares of common stock. Includes 1,445 shares of common stock issued as a dividend with respect to his shares of Series A preferred stock. Also includes warrants to purchase 25,035 shares of common stock. The Series A preferred stock and the warrants are held by jointly by Dr. Warner and his wife, Ellen McBee.
|
(4)
|
Unless otherwise set forth herein, the address of each beneficial owner is 278 DP Road, Suite D, Los Alamos, New Mexico 87587544
|
Shareholder and Name of Person Controlling
|
Number of Shares
Before Offering
|
Number of
Shares Offered
|
Date Acquired
|
Amount of Shares
Owned After Offering
|
Percent of Shares
Held After Offering
|
|||||||||||||||
Eight Family Trust
|
27,851
|
(1)
|
27,851
|
3/22/2011
|
0
|
0
|
||||||||||||||
Chang-Tai Hsieh
|
19,756
|
(2)
|
19,756
|
3/24/2011
|
0
|
0
|
||||||||||||||
Joseph Amato Revocable Trust
|
52,632
|
(3)
|
52,632
|
4/7/2011
|
0
|
0
|
||||||||||||||
Sin Fa Wang and Mei Wang
|
18,058
|
(4)
|
18,058
|
4/11/2011
|
0
|
0
|
||||||||||||||
S/L Trilling Trust
|
36,104
|
(5)
|
36,104
|
4/14/2011
|
0
|
0
|
||||||||||||||
Douglas Jensen
|
27,785
|
(6)
|
27,785
|
4/18/2011
|
0
|
0
|
||||||||||||||
Mark Litwin
|
35,088
|
(7)
|
35,088
|
4/26/2011
|
0
|
0
|
||||||||||||||
Robert S. Colman
|
18,027
|
(8)
|
18,027
|
4/27/2011
|
0
|
0
|
||||||||||||||
2030 Investors LLC/401K Plan
|
51,293
|
(9)
|
51,293
|
5/12/2011
|
0
|
0
|
||||||||||||||
Sarah Abrams
|
42,998
|
(10)
|
42,998
|
5/12/2011
|
0
|
0
|
||||||||||||||
Matthew Abrams
|
92,998
|
(11)
|
92,998
|
5/12/2011
|
0
|
0
|
||||||||||||||
Joseph W. and Patricia G. Family Trust
|
160,450
|
(12)
|
160,450
|
5/16/2011
|
0
|
0
|
||||||||||||||
James Jensen
|
70,000
|
(13)
|
70,000
|
6/7/2011
|
0
|
0
|
||||||||||||||
Chan Kei Blu
|
53,301
|
(14)
|
53,301
|
9/8/2011
|
0
|
0
|
||||||||||||||
Louitt & V. Hannan, Inc. Salary Deferral Plan FBO J. Thomas Hannan
|
17,757
|
(15)
|
17,757
|
9/13/2011
|
0
|
0
|
||||||||||||||
George Mainas
|
17,699
|
(16)
|
17,699
|
10/13/2011
|
0
|
0
|
||||||||||||||
Saunders and Diane Kohn
|
70,588
|
(17)
|
70,588
|
10/17/2011
|
0
|
0
|
||||||||||||||
David Steinhardt and Tobi B Richman Steinhardt Trust
|
20,176
|
(18)
|
20,176
|
1/22/2012
|
0
|
0
|
||||||||||||||
Los Alamos National Security, LLC
|
157,500
|
(19)
|
157,500
|
(19
|
)
|
0
|
0
|
|||||||||||||
Richard Scott Lane
|
73,571
|
(20)
|
73,571
|
(20
|
)
|
0
|
0
|
|||||||||||||
Aldermon Holdings
|
17,500
|
(21)
|
17,500
|
(21
|
)
|
0
|
0
|
|||||||||||||
TRV, LLC
|
8,750
|
(22)
|
8,750
|
4/6/2006
|
0
|
0
|
||||||||||||||
David Clark
|
8,750
|
8,750
|
5/9/2006
|
0
|
0
|
|||||||||||||||
CO 51 AIC Holdings LLC
|
87,565
|
(23)
|
87,565
|
9/22/2006
|
0
|
0
|
||||||||||||||
Jack Warner
|
10,000
|
10,000
|
10/10/2006
|
0
|
0
|
|||||||||||||||
Cirrus Advisors, Inc.
|
26,250
|
(24)
|
26,250
|
(24
|
)
|
0
|
0
|
|||||||||||||
Michael Lyon Profit Sharing Plan
|
25,715
|
(24)
|
25,715
|
(24
|
)
|
0
|
0
|
|||||||||||||
Susan Gerard
|
26,250
|
(24)
|
26,250
|
(24
|
)
|
0
|
0
|
|||||||||||||
Susan Gerard IRA
|
25,714
|
(24)
|
25,714
|
(24
|
)
|
0
|
0
|
|||||||||||||
Nathan H. Zahler
|
2,418
|
(25)
|
2,418
|
(25
|
)
|
0
|
0
|
|||||||||||||
Gregg Rzepczynski
|
2,459
|
(26)
|
2,459
|
(26
|
)
|
0
|
0
|
|||||||||||||
Emelia A. Solomon
|
1,830
|
(27)
|
1,830
|
(27
|
)
|
0
|
0
|
|||||||||||||
Pratima Bharti
|
636
|
(28)
|
636
|
(28
|
)
|
0
|
0
|
|||||||||||||
First South Africa Management
|
100,000
|
(29)
|
100,000
|
(29
|
)
|
0
|
0
|
|||||||||||||
Total
|
1,407,469
|
1,407,469
|
0
|
0
|
(1)
|
Includes 13,500 shares of common stock which are convertible upon conversion of the Series A Preferred Stock, 13,500 shares of common stock which are issuable upon exercise of the warrant and 851 shares of common stock that were issued in February 14, 2012 as a dividend with respect to the Series A preferred stock. Walter Bilofsky has sole voting and dispositive power with respect to these securities.
|
||
(2)
|
Includes (i) 8,772 shares of common stock which are convertible upon conversion of the Series A Preferred Stock; (ii) 8,772 shares of common stock which are issuable upon exercise of the warrant; (iii) 324 shares of common stock issued upon exercise stock options that were exercised on March 3, 2011; (iv) 420 shares of common stock issued upon exercise stock options that were exercised on March 17, 2011; (v) 420 shares of common stock issued upon exercise stock options that were exercised on March 31, 2011; (vi) 419 shares of common stock issued upon exercise stock options that were exercised on April 14, 2011; (vii) 420 shares of common stock issued upon exercise stock options that were exercised on April 28, 2011; and (viii) 209 stock options that were exercised on May 26, 2011.
|
( 3 )
|
Includes 26,316 shares of common stock which are convertible upon conversion of the Series A Preferred Stock and 26,316 shares of common stock which are issuable upon exercise of the warrant . Joseph Amato has sole voting and dispositive power with respect to these securities.
|
( 4 )
|
Includes 8,772 shares of common stock which are convertible upon conversion of the Series A Preferred Stock , 8,772 shares of common stock which are issuable upon exercise of the warrant and 514 shares of common stock that were issued in February 14, 2012 as a dividend with respect to the Series A preferred stock.
|
(5)
|
Includes 17,544 shares of common stock which are convertible upon conversion of the Series A Preferred Stock, 17,544 shares of common stock which are issuable upon exercise of the warrant and 1,016 shares of common stock that were issued in February 14, 2012 as a dividend with respect to the Series A preferred stock. Stan Trilling has sole voting and dispositive power with respect to these securities.
|
(6)
|
Includes (i) 5,000 shares of common stock which are convertible upon conversion of the Series A Preferred Stock; (ii) 5,000 shares of common stock which are issuable upon exercise of the warrant; (iii) 10,500 shares of common stock that were issued on February 6, 2006; and (iv) 7,000 shares of common stock that were issued on July 19, 2006 and 285 shares of common stock that were issued in February 14, 2012 as a dividend with respect to the Series A preferred stock.
|
(7)
|
Includes 17,544 shares of common stock which are convertible upon conversion of the Series A Preferred Stock and 17,544 shares of common stock which are issuable upon exercise of the warrant
|
(8)
|
Includes 8,772 shares of common stock which are convertible upon conversion of the Series A Preferred Stock, 8,772 shares of common stock which are issuable upon exercise of the warrant and 483 shares of common stock that were issued in February 14, 2012 as a dividend with respect to the Series A preferred stock.
|
(9)
|
Includes 25,000 shares of common stock which are convertible upon conversion of the Series A Preferred Stock, 25,000 shares of common stock which are issuable upon exercise of the warrant and 1,293 shares of common stock that were issued in February 14, 2012 as a dividend with respect to the Series A preferred stock. Ellison Morgan has sole voting and dispositive power with respect to these securities.
|
(10)
|
Includes: (i) 8,772 shares of common stock which are convertible upon conversion of the Series A Preferred Stock; (ii) 8,772 shares of common stock which are issuable upon exercise of the warrant; and (iii) 25,000 shares of common stock that were issued on October 26, 2010 for services rendered and 454 shares of common stock that were issued in February 14, 2012 as a dividend with respect to the Series A preferred stock.
|
(11)
|
Includes (i) 8,772 shares of common stock which are convertible upon conversion of the Series A Preferred Stock; (ii) 8,772 shares of common stock which are issuable upon exercise of the warrant; (iii) 75,000 shares of common stock that were issued on October 26, 2010 for services rendered and 454 shares of common stock that were issued in February 14, 2012 as a dividend with respect to the Series A preferred stock.
|
(12)
|
Includes (i) 43,860 shares of common stock which are convertible upon conversion of the Series A Preferred Stock; (ii) 43,860 shares of common stock which are issuable upon exercise of the warrant; and (ii) 70,500 shares of common stock that were issued on October 26, 2010 for services rendered and 2,230 shares of common stock that were issued in February 14, 2012 as a dividend with respect to the Series A preferred stock. Joseph Abrams has sole voting and dispositive power with respect to these securities.
|
(13)
|
Includes (i) 35,000 shares of common stock which are convertible upon conversion of the Series A Preferred Stock; (ii) 35,000 shares of common stock which are issuable upon exercise of the warrant.
|
(14)
|
Includes 26,316 shares of common stock which are convertible upon conversion of the Series A Preferred Stock, 26,316 shares of common stock which are issuable upon exercise of the warrant and 669 shares of common stock that were issued in February 14, 2012 as a dividend with respect to the Series A preferred stock.
|
(15)
|
Includes 8,772 shares of common stock which are convertible upon conversion of the Series A Preferred Stock, 8,772 shares of common stock which are issuable upon exercise of the warrant and 213 shares of common stock that were issued in February 14, 2012 as a dividend with respect to the Series A preferred stock. Thomas Hannan has sole voting and dispositive power with respect to these securities.
|
(16)
|
Includes 8,772 shares of common stock which are convertible upon conversion of the Series A Preferred Stock, 8,772 shares of common stock which are issuable upon exercise of the warrant and 155 shares of common stock that were issued in February 14, 2012 as a dividend with respect to the Series A preferred stock.
|
(17)
|
Includes 35,000 shares of common stock which are convertible upon conversion of the Series A Preferred Stock, 35,000 shares of common stock which are issuable upon exercise of the warrant and 588 shares of common stock that were issued in February 14, 2012 as a dividend with respect to the Series A preferred stock.
|
(18)
|
Includes 10,088 shares of common stock which are convertible upon conversion of the Series A Preferred Stock and 10,088 shares of common stock which are issuable upon exercise of the warrant. David Steinhardt and Tobi B Richman Steinhardt have shared voting and dispositive power with respect to these securities.
|
(19)
|
Shares issued on June 15, 2006 in connection with a license agreement. Charles McMillan has sole voting and dispositive power with respect to these securities.
|
(20)
|
Includes (i) 35,000 shares of common stock that were issued on January 23, 2006; and (ii) 38,571 shares of common stock that were issued on October 22, 2010 in connection with a settlement agreement.
|
(21)
|
Includes (i) 8,750 shares of common stock that were issued on March 27, 2006; and (ii) 8,750 shares of common stock that were issued on May 19, 2006. Yves Malki has sole voting and dispositive power with respect to these securities.
|
(22)
|
Robert Gurolnick has sole voting and dispositive power with respect to these securities.
|
(23)
|
Paul Daguerdas has sole voting and dispositive power with respect to these securities.
|
(24)
|
Includes (i) 52,500 shares of common stock that were issued on August 1, 2006 for services rendered of which 26,250 shares were transferred to Cirrus Advisors, Inc. a company which Mr. Lyons has a controlling interest and 26,250 were transferred on August 3, 2011 to Susan Gerard as part of a divorce settlement; and (ii) 51,429 shares of common stock that were issued on October 22, 2010 of which 25,715 shares were transferred to the Michael T. Lyon Profit Sharing Plan and 25,714 shares were transferred on August 3, 2011 to the Susan Gerard IRA as part of a divorce settlement between Lyon and Gerard. Michael Lyon has sole voting and dispositive power with respect to the securities held by each of Cirrus Advisors, Inc. and the Michal T. Lyon Profit Sharing Plan. Susan Gerard has sole voting and dispositive power with respect to the securities held by the Susan Gerard IRA.
|
|||
(25)
|
Includes (i) 381 shares of common stock issued upon exercise stock options that were exercised on March 3, 2011; (ii) 453 shares of common stock issued upon exercise stock options that were exercised on March 17, 2011; (iii) 453 shares of common stock issued upon exercise stock options that were exercised on March 31, 2011; (iv) 452 shares of common stock issued upon exercise stock options that were exercised on April 14, 2011; (v) 453 shares of common stock issued upon exercise stock options that were exercised on April 28, 2011; and (vi) 226 shares of common stock issued upon exercise stock options that were exercised on May 26, 2011.
|
Includes (i) 326 shares of common stock issued upon exercise stock options that were exercised on March 3, 2011; (ii) 474 shares of common stock issued upon exercise stock options that were exercised on March 17, 2011; (iii) 474 shares of common stock issued upon exercise stock options that were exercised on March 31, 2011; (iv) 474 shares of common stock issued upon exercise stock options that were exercised on April 14, 2011; (v) 474 shares of common stock issued upon exercise stock options that were exercised on April 28, 2011; and (vi) 237 shares of common stock issued upon exercise stock options that were exercised on May 26, 2011.
|
|
(27)
|
Includes (i) 333 shares of common stock issued upon exercise stock options that were exercised on March 3, 2011; (ii) 333 shares of common stock issued upon exercise stock options that were exercised on March 17, 2011; (iii) 333 shares of common stock issued upon exercise stock options that were exercised on March 31, 2011; (iv) 332 shares of common stock issued upon exercise stock options that were exercised on April 14, 2011; (v) 333 shares of common stock issued upon exercise stock options that were exercised on April 28, 2011; and (vi) 166 shares of common stock issued upon exercise stock options that were exercised on May 26, 2011.
|
(28)
|
Includes (i) 178 shares of common stock issued upon exercise stock options that were exercised on March 17, 2011; (ii) 154 shares of common stock issued upon exercise stock options that were exercised on March 31, 2011; (iii) 165 shares of common stock issued upon exercise stock options that were exercised on April 14, 2011; and (iv) 139 shares of common stock issued upon exercise stock options that were exercised on April 28, 2011.
|
(29)
|
Shares issued on December 2011 and February 2012 for services rendered. Clive Kabatznik has sole voting and dispositive power with respect to these securities.
|
•
|
ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers;
|
•
|
block trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the block as principal to facilitate the transaction;
|
•
|
purchases by a broker-dealer as principal and resale by the broker-dealer for its account;
|
•
|
an exchange distribution in accordance with the rules of the applicable exchange;
|
•
|
privately negotiated transactions;
|
•
|
broker-dealers may agree with the selling security holders to sell a specified number of such shares at a stipulated price per share;
|
•
|
a combination of any such methods of sale; or
|
•
|
any other method permitted pursuant to applicable law.
|
·
|
diluting the voting or other rights of the proposed acquirer or insurgent stockholder group;
|
·
|
putting a substantial voting block in institutional or other hands that might undertake to support the incumbent board of directors; or
|
·
|
effecting an acquisition that might complicate or preclude the takeover.
|
March 31,
2012
(Unaudited)
|
December 31,
2011
|
|||||||
ASSETS
|
||||||||
Current assets:
|
||||||||
Cash
|
$ | 180,195 | $ | 678,300 | ||||
Accounts receivable, net
|
242,443 | 30,505 | ||||||
Prepaid expenses
|
46,872 | 15,616 | ||||||
Total current assets
|
469,510 | 724,421 | ||||||
Non-current assets:
|
||||||||
Intangible assets, net
|
633,337 | 646,258 | ||||||
Plant and equipment, net
|
238,966 | 243,778 | ||||||
872,303 | 890,036 | |||||||
TOTAL ASSETS
|
$ | 1,341,813 | $ | 1,614,457 | ||||
LIABILITIES AND STOCKHOLDERS’ (DEFICIT)/EQUITY
|
||||||||
Current liabilities:
|
||||||||
Accounts payable
|
$ | 527,394 | $ | 572,715 | ||||
Other payables and accrued expenses
|
135,704 | 146,823 | ||||||
Loans payable
|
83,668 | 29,748 | ||||||
Dividends payable
|
38,804 | 87,457 | ||||||
Total current liabilities
|
785,570 | 836,743 | ||||||
Non-current liabilities:
|
||||||||
Loans payable
|
233,532 | 241,204 | ||||||
233,532 | 241,204 | |||||||
TOTAL LIABILITIES
|
1,019,102 | 1,077,947 | ||||||
Convertible Redeemable Preferred Stock
|
||||||||
Series “A” Convertible Redeemable Preferred Stock, $0.001 par value, Authorized: 10,000,000 shares, 341,607 and 331,519 shares issued and outstanding at of March 31, 2012 and December 31, 2011, respectively, liquidation preference is $5.70 per share.
|
2,065,392 | 2,005,035 | ||||||
STOCKHOLDERS DEFICIT:
|
||||||||
Common stock, $0.001 par value, authorized 50,000,000 shares and, 4,956,270 and 4,945,620 shares issued and, 4,302,270 and 4,291,620 outstanding as of March 31, 2012 and December 31, 2011 respectively.
|
4,957 | 4,946 | ||||||
Additional paid in capital
|
4,623,634 | 4,542,646 | ||||||
Treasury stock, at cost
|
(473 | ) | (473 | ) | ||||
Accumulated deficit
|
(6,370,799 | ) | (6,015,644 | ) | ||||
Total stockholder’s (deficit)/equity
|
(1,742,681 | ) | (1,468,525 | ) | ||||
TOTAL LIABILITIES AND STOCKHOLDERS DEFICIT
|
$ | 1,341,813 | $ | 1,614,457 |
Quarter ended
March 31,
2012
|
Quarter ended
March 31,
2011
|
|||||||
Sales
|
$ | 377,737 | $ | 291,644 | ||||
Cost of sales
|
177,636 | 142,751 | ||||||
Gross profit
|
200,101 | 148,893 | ||||||
Operating expenses:
|
||||||||
Selling, general and administrative expenses
|
478,491 | 456,732 | ||||||
Depreciation
|
19,092 | 15,880 | ||||||
Amortization
|
12,921 | 12,921 | ||||||
Total operating expenses
|
510,504 | 485,533 | ||||||
Operating loss
|
(310,403 | ) | (336,640 | ) | ||||
Other income/(expense)
|
||||||||
Other income
|
- | - | ||||||
Interest income
|
355 | - | ||||||
Interest expense
|
(3,446 | ) | (4,989 | ) | ||||
Total other income/(expense)
|
(3,091 | ) | (4,989 | ) | ||||
Loss before income tax
|
(313,494 | ) | (341,629 | ) | ||||
Provision for income taxes
|
- | - | ||||||
Net loss
|
(313,494 | ) | (341,629 | ) | ||||
Deemed preferred stock dividends
|
(2,857 | ) | (6,914 | ) | ||||
Preferred stock dividends
|
(38,804 | ) | (259 | ) | ||||
Net loss applicable to common stock
|
$ | (355,155 | ) | $ | (348,802 | ) | ||
Net loss per common stock: -
|
||||||||
Basic and diluted
|
$ | (0.08 | ) | $ | (0.07 | ) | ||
Weighted average number of common stock outstanding: -
|
||||||||
Basic and diluted
|
4,298,642 | 4,886,778 |
Common Stock
|
Treasury stock
|
|||||||||||||||||||||||
Number
of
shares
|
Amount
|
Amount
|
Additional
Paid-in capital
|
Accumulated
deficit
|
Total
Stockholder’s
Equity
|
|||||||||||||||||||
Balance at December 31, 2011
|
4,291,620 | $ | 4,946 | $ | (473 | ) | $ | 4,542,646 | $ | (6,015,644 | ) | $ | (1,468,525 | ) | ||||||||||
Unaudited:
|
||||||||||||||||||||||||
Common stock issued in lieu of cash for preferred stock dividend
|
10,650 | 11 | - | 60,694 | - | 60,705 | ||||||||||||||||||
Fair value of stock options issued to employees
|
- | - | - | 20,294 | - | 20,294 | ||||||||||||||||||
Net loss
|
- | - | - | - | (313,494 | ) | (313,494 | ) | ||||||||||||||||
Deemed preferred stock dividend
|
- | - | - | - | (2,857 | ) | (2,857 | ) | ||||||||||||||||
Preferred stock dividend
|
- | - | - | - | (38,804 | ) | (38,804 | ) | ||||||||||||||||
Balance at March 31, 2012
|
4,302,270 | $ | 4,957 | $ | (473 | ) | $ | 4,623,634 | $ | (6,370,799 | ) | $ | (1,742,681 | ) |
Quarter ended
March 31,
2012
|
Quarter ended
March 31,
2011
|
|||||||
Cash flow from operating activities
|
||||||||
Net loss
|
$ | (313,494 | ) | $ | (341,629 | ) | ||
Adjustments for non-cash items:
|
||||||||
Depreciation
|
19,092 | 15,880 | ||||||
Amortization
|
12,921 | 12,921 | ||||||
Stock based compensation payments
|
20,294 | 183,931 | ||||||
Changes in operating assets and liabilities:
|
||||||||
Increase in accounts receivable
|
(211,938 | ) | (4,725 | ) | ||||
Increase in prepaid expenses
|
(31,256 | ) | (36,330 | ) | ||||
(Decrease)/increase in accounts payable
|
(45,321 | ) | 117,155 | |||||
Decrease in other payables and accrued expenses
|
(11,119 | ) | (27,198 | ) | ||||
Net cash utilized by operating activities
|
(560,821 | ) | (79,995 | ) | ||||
Investing activities
|
||||||||
Purchase of plant and equipment
|
(14,280 | ) | (657 | ) | ||||
Net cash used in investing activities
|
(14,280 | ) | (657 | ) | ||||
Financing activities
|
||||||||
Advance on line of credit, net
|
50,000 | - | ||||||
Repayment of line of credit
|
- | (22 | ) | |||||
Repayment of loan payable
|
(3,752 | ) | (6,943 | ) | ||||
Loan advanced by stockholder
|
- | 62,000 | ||||||
Proceeds on Series “A” Preferred stock issued
|
57,500 | 126,950 | ||||||
Proceeds on Common stock options exercised
|
- | 28,858 | ||||||
Preferred stock dividends paid
|
(26,752 | ) | - | |||||
Net cash provided by financing activities
|
76,996 | 210,843 | ||||||
Net increase in cash
|
(498,105 | ) | 130,191 | |||||
Cash at the beginning of the period
|
678,300 | 117,910 | ||||||
Cash at the end of the period
|
$ | 180,195 | $ | 248,101 | ||||
Supplemental disclosure of cash flow information
|
||||||||
Cash paid for:
|
||||||||
Interest
|
$ | 3,446 | $ | 4,989 | ||||
Non cash investing and financing activities:
|
||||||||
Common stock issued in lieu of preferred stock dividends
|
$ | 60,705 | $ | - | ||||
Deemed preferred stock dividends relating to warrants issued to preferred stock holders
|
$ | 2,857 | $ | 6,914 |
1.
|
GENERAL INFORMATION
|
2.
|
ACCOUNTING POLICIES AND ESTIMATES
|
2.
|
ACCOUNTING POLICIES AND ESTIMATES (continued)
|
2.
|
ACCOUNTING POLICIES AND ESTIMATES (continued)
|
a)
|
License Agreements
License agreements acquired by the Company are reported at acquisition value less accumulated amortization and impairments.
|
b)
|
Amortization
Amortization is reported in the income statement straight-line over the estimated useful life of the intangible assets, unless the useful life is indefinite. Amortizable intangible assets are amortized from the date that they are available for use. The estimated useful life of the license agreement is twenty years which is the term of the patent supporting the underlying license agreements
Assessment of an intangible asset’s residual value and useful life is performed annually.
|
2.
|
ACCOUNTING POLICIES AND ESTIMATES (continued)
|
Leasehold improvements | 5 Years | ||
Laboratory equipment | 7 Years | ||
Furniture and fixtures | 10 Years | ||
Computer equipment | 3 Years | ||
Motor vehicles (used) | 2 Years |
March 31,
2012
|
March 31,
2011
|
|||||||
Department of Defense
|
$ | - | $ | 149,790 | ||||
National Institutes of Health
|
377,737 | 103,166 | ||||||
Federal Government Grants
|
- | 38,688 | ||||||
$ | 377,737 | $ | 291,644 |
2.
|
ACCOUNTING POLICIES AND ESTIMATES (continued)
|
2.
|
ACCOUNTING POLICIES AND ESTIMATES (continued)
|
2.
|
ACCOUNTING POLICIES AND ESTIMATES (continued)
|
3.
|
GOING CONCERN
|
4.
|
INTANGIBLE ASSETS
|
●
|
Method for Detecting Binding Events Using Micro X-Ray Fluorescence Spectrometry;
|
●
|
Flow Method and Apparatus for Screening Chemicals Using Micro X-Ray Fluorescence;
|
●
|
Method and Apparatus for Detecting Chemical Binding;
|
●
|
Drug Development and Manufacturing.
|
4.
|
INTANGIBLE ASSETS (continued)
|
Amount
|
||||
2013
|
$ | 50,000 | ||
2014
|
50,000 | |||
2015
|
50,000 | |||
2016
|
50,000 | |||
2017 and thereafter
|
300,000 | |||
Total
|
$ | 500,000 |
March 31,
2012
|
December 31,
2011
|
|||||||
Licenses, at cost
|
$ | 972,000 | $ | 972,000 | ||||
Less: Accumulated amortization
|
(338,663 | ) | (325,742 | ) | ||||
$ | 633,337 | $ | 646,258 |
4.
|
INTANGIBLE ASSETS (continued)
|
Amount
|
||||
2012
|
$ | 38,763 | ||
2013
|
51,684 | |||
2014
|
51,684 | |||
2015
|
51,684 | |||
2016
|
51,684 | |||
2017 and thereafter
|
387,838 | |||
Total
|
$ | 633,337 |
●
|
Well Plate – apparatus for preparing samples for measurement by x-ray fluorescence spectrometry. Patent filed August 15, 2008
|
●
|
Method and Apparatus for measuring Protein Post Translational Modification. Patent filed September 26, 2008.
|
●
|
Method and Apparatus for Measuring Analyte Transport across barriers. Patent filed July 1, 2009.
|
5.
|
PLANT AND EQUIPMENT
|
March 31,
2012
|
December 31,
2011
|
|||||||
Leasehold improvements
|
$ | 6,393 | $ | 6,393 | ||||
Furniture and fittings
|
7,114 | 7,114 | ||||||
Laboratory equipment
|
464,180 | 462,434 | ||||||
Computer equipment
|
29,925 | 29,330 | ||||||
Vehicles
|
11,939 | - | ||||||
Total
|
519,551 | 505,271 | ||||||
Accumulated depreciation
|
(280,585 | ) | (261,493 | ) | ||||
$ | 238,966 | $ | 243,778 |
6.
|
OTHER PAYABLES AND ACCRUED EXPENSES
|
March 31,
2012
|
December 31,
2011
|
|||||||
Credit card liabilities
|
$ | 19,550 | $ | 15,750 | ||||
Vacation and Sick Pay accrual
|
104,336 | 100,771 | ||||||
Payroll liabilities
|
9,718 | 28,202 | ||||||
Other
|
2,100 | 2,100 | ||||||
$ | 135,704 | $ | 146,823 |
7.
|
LOANS PAYABLE
|
March 31,
2012
|
December 31,
2011
|
|||||||
Short term portion
|
||||||||
Los Alamos County Loan
|
$ | 33,668 | $ | 29,748 | ||||
Los Alamos National Bank
|
50,000 | - | ||||||
83,668 | 29,748 | |||||||
Long term portion
|
||||||||
Los Alamos County Loan
|
233,532 | 241,204 | ||||||
$ | 317,200 | $ | 270,952 |
Amount
|
||||
2012
|
$ | 75,996 | ||
2013
|
31,270 | |||
2014
|
32,869 | |||
2015
|
34,551 | |||
2016
|
36,319 | |||
2017 and thereafter
|
106,195 | |||
Total
|
$ | 317,200 |
7.
|
LOANS PAYABLE (continued)
|
8.
|
OTHER STOCKHOLDERS’ EQUITY
|
8.
|
OTHER STOCKHOLDERS’ EQUITY (continued)
|
9.
|
COMMON STOCK
|
10.
|
WARRANTS
|
Quarter ended
March 31,
2012
|
Year ended
December 31,
2011
|
|||||||
Risk-free interest rate
|
0.04% to 0.11
|
% |
0.01% to 0.15
|
% | ||||
Expected life of the warrants
|
5 Years
|
5 Years
|
||||||
Expected volatility of the underlying stock
|
120 | % | 128 | % | ||||
Expected dividend rate
|
0 | % | 0 | % |
10.
|
WARRANTS (continued)
|
Warrants
|
Exercise Price
|
Expiration Date
|
|||
22,272
|
$ 5.70 |
March 2016
|
|||
108,983
|
$ 5.70 |
April 2016
|
|||
86,404
|
$ 5.70 |
May 2016
|
|||
35,000
|
$ 5.70 |
June 2016
|
|||
40,000
|
$ 5.70 |
July 2016
|
|||
35,088
|
$ 5.70 |
September 2016
|
|||
46,572
|
$ 5.70 |
October 2016
|
|||
15,000
|
$ 2.00 |
October 2016
|
|||
10,088
|
$ 5.70 |
January 2017
|
|||
399,407
|
11.
|
STOCK BASED COMPENSATION
|
Quarter ended
March 31,
2012
|
Year ended
December 31,
2011
|
|||||||
Risk-free interest rate
|
0.04% to 0.11
|
% |
0.01% to 0.15
|
% | ||||
Expected life of the options
|
5 years
|
5 Years
|
||||||
Expected volatility of the underlying stock
|
120 | % | 128 | % | ||||
Expected dividend rate
|
0 | % | 0 | % |
11.
|
STOCK BASED COMPENSATION (continued)
|
Shares
|
Exercise price per share
|
Weighted average exercise price
|
||||||||||
Outstanding January 1, 2011
|
285,500 | $ | 2.00 - $5.71 | $ | 5.13 | |||||||
Granted
|
477,500 | $ | 1.10 - $5.71 | $ | 1.46 | |||||||
Forfeited/Cancelled
|
(235,000 | ) | $ | 1.10 - $5.71 | $ | 1.16 | ||||||
Exercised
|
(9,555 | ) | $ | 5.71 | $ | 5.71 | ||||||
Outstanding December 31, 2011
|
518,445 | $ | 1.10 - $5.71 | $ | 3.54 | |||||||
Granted
|
- | - | - | |||||||||
Outstanding March 31, 2012
|
518,445 | $ | 1.10 - $5.71 | $ | 3.54 |
11.
|
STOCK BASED COMPENSATION (continued)
|
Options Outstanding
|
Options Exercisable
|
|||||||||||||||||||
Exercise Price
|
Number of shares
|
Weighted average remaining contractual years
|
Weighted Average Exercise Price
|
Number of Shares
|
Weighted Average exercise Price
|
|||||||||||||||
$1.10
|
220,000 | 8.92 | $ | 1.10 | 220,000 | $ | 1.10 | |||||||||||||
$2.00
|
30,000 | 3.67 | $ | 2.00 | 30,000 | $ | 2.00 | |||||||||||||
$5.71
|
268,445 | 6.45 | $ | 5.71 | 249,695 | $ | 5.71 | |||||||||||||
518,445 | 7.34 | $ | 3.54 | 499,695 | $ | 3.46 |
12.
|
NET LOSS PER COMMON SHARE
|
Year ended
December 31,
2011
(Shares)
|
Quarter ended
March 31,
2011
(Shares)
|
|||||||
Options to purchase shares of common stock
|
518,445 | 740,446 | ||||||
Series “A” Convertible Preferred stock
|
341,607 | 22,272 | ||||||
Warrants
|
399,407 | 22,272 | ||||||
1,259,459 | 784,990 |
13.
|
OPERATING LEASES
|
Amount
|
||||
2012
|
44,643 | |||
2013
|
50,753 | |||
Total
|
$ | 95,396 |
14.
|
LITIGATION
|
14.
|
LITIGATION (continued)
|
14.
|
LITIGATION (continued)
|
15.
|
SUBSEQUENT EVENTS
|
|
7900 Glades Road., Suite 540
Boca Raton, Florida 33434
Tel. 561-886-4200
Fax. 561-886-3330
e-mail:info@sherbcpa.com
Offices in New York and Florida
|
|
/s/
Sherb & Co., LLP
|
Certified Public Accountants
|
December 31,
2011
|
December 31,
2010
|
|||||||
ASSETS
|
||||||||
Current assets:
|
||||||||
Cash
|
$ | 678,300 | $ | 117,910 | ||||
Accounts receivable, net
|
30,505 | 264,488 | ||||||
Prepaid expenses
|
15,616 | 3,010 | ||||||
Total current assets
|
724,421 | 385,408 | ||||||
Non-current assets:
|
||||||||
Intangible assets, net
|
646,258 | 697,942 | ||||||
Plant and equipment, net
|
243,778 | 255,105 | ||||||
890,036 | 953,047 | |||||||
TOTAL ASSETS
|
$ | 1,614,457 | $ | 1, 338,455 | ||||
LIABILITIES AND STOCKHOLDERS’ (DEFICIT)/EQUITY
|
||||||||
Current liabilities:
|
||||||||
Accounts payable
|
$ | 572,715 | $ | 290,891 | ||||
Other payables and accrued expenses
|
146,823 | 125,604 | ||||||
Loans payable
|
29,748 | 116,084 | ||||||
Loans from related parties
|
- | 77,600 | ||||||
Dividends payable
|
87,457 | - | ||||||
Total current liabilities
|
8 36,743 | 610,179 | ||||||
Non-current liabilities:
|
||||||||
Loans payable
|
241,204 | 270,952 | ||||||
241,204 | 270,952 | |||||||
TOTAL LIABILITIES
|
1, 0 77,947 | 881, 131 | ||||||
Convertible Redeemable Preferred Stock
|
||||||||
Series “A” Convertible Redeemable Preferred Stock, $0.001 par value, Authorized: 10,0 00,000 shares, 331,519 shares issued and outstanding at of December 31, 2011, liquidation preference is $5.70 per share.
|
2,005,035 | - | ||||||
STOCKHOLDERS (DEFICIT)/EQUITY:
|
||||||||
Common stock, $0.001 par value, authorized 50,000,000 shares and 10,000,000, and, 4,945,620 and 4,886,065 shares issued and, 4,291,620 and 4,886,065 outstanding as of December 31, 2011 and 2010, respectively.
|
4,946 | 4,886 | ||||||
Additional paid in capital
|
4,542,646 | 4,112,317 | ||||||
Treasury stock, at cost
|
(473 | ) | - | |||||
Accumulated deficit
|
(6, 015,644 | ) | (3, 659,879 | ) | ||||
Total stockholder’s (deficit)/equity
|
(1, 468,525 | ) | 457,324 | |||||
TOTAL LIABILITIES AND STOCKHOLDERS (DEFICIT)/EQUITY
|
$ | 1,614,457 | $ | 1, 338,455 |
Year ended
December 31,
2011
|
Year ended
December 31,
2010
|
|||||||
Sales
|
$ | 554,804 | $ | 1,641,582 | ||||
Cost of sales
|
342,850 | 760,728 | ||||||
Gross profit
|
211,954 | 880,854 | ||||||
Operating expenses:
|
||||||||
Selling, general and administrative expenses
|
2,238,810 | 1,609,847 | ||||||
Depreciation
|
67,383 | 64,012 | ||||||
Amortization
|
51,684 | 51,683 | ||||||
Total operating expenses
|
2,3 57,877 | 1,7 25,542 | ||||||
Operating loss
|
(2,1 45,923 | ) | (8 44,688 | ) | ||||
Other income/(expense)
|
||||||||
Other income
|
8,283 | - | ||||||
Interest income
|
1,093 | 9 | ||||||
Interest expense
|
(16,376 | ) | (20,203 | ) | ||||
Total other income/(expense)
|
(7,000 | ) | (20,194 | ) | ||||
Loss before income tax
|
(2,1 52,923 | ) | (8 64,882 | ) | ||||
Provision for income taxes
|
- | - | ||||||
Net loss
|
(2,1 52,923 | ) | (8 64,882 | ) | ||||
Deemed preferred stock dividends
|
(115,385 | ) | - | |||||
Preferred stock dividends
|
(87,457 | ) | - | |||||
Net loss applicable to common stock
|
$ | (2,3 55,765 | ) | $ | (8 64,882 | ) | ||
Net loss per common stock: -
|
||||||||
Basic and diluted
|
$ | (0. 49 | ) | $ | (0. 19 | ) | ||
Weighted average number of common stock outstanding: -
|
||||||||
Basic and diluted
|
4,802,329 | 4,549,502 |
Common Stock
|
Treasury
stock
Amount
|
|||||||||||||||||||||||
Number
of
shares
|
Amount
|
Additional
Paid-in capital
|
Accumulated deficit
|
Total Stockholder’s Equity
|
||||||||||||||||||||
Balance at January 1, 2010
|
4,471,565 | $ | 4,472 | $ | - | $ | 3,578,187 | $ | (2, 794,997 | ) | $ | 787,662 | ||||||||||||
Stock issued in terms of settlement agreement between shareholders during October 2010
|
90,000 | 90 | - | 33,950 | - | 34,040 | ||||||||||||||||||
Issuance of common stock as compensation for consulting fees
|
324,500 | 324 | - | 178,152 | - | 178,476 | ||||||||||||||||||
Fair value of stock options issued to employees
|
- | - | - | 322,028 | - | 322,028 | ||||||||||||||||||
Net loss
|
- | - | - | - | (8 64,882 | ) | (8 64,882 | ) | ||||||||||||||||
Balance at December 31, 2010
|
4,886,065 | 4,886 | - | 4,112,317 | (3, 659,879 | ) | 457,324 | |||||||||||||||||
Stock options exercised
|
9,555 | 10 | - | 54,549 | - | 54,559 | ||||||||||||||||||
Issuance of common stock as compensation for consulting fees
|
50,000 | 50 | - | 27,450 | - | 27,500 | ||||||||||||||||||
Fair value of stock options issued to employees
|
- | - | - | 342,342 | - | 342,342 | ||||||||||||||||||
Fair value of warrants issued for consulting fees
|
- | - | - | 5,988 | - | 5,988 | ||||||||||||||||||
Treasury stock purchased
|
(654,000 | ) | - | (473 | ) | - | - | (473 | ) | |||||||||||||||
Net loss
|
- | - | - | - | (2,1 52,923 | ) | (2,1 52,923 | ) | ||||||||||||||||
Deemed preferred stock dividend
|
- | - | - | - | (115,385 | ) | (115,385 | ) | ||||||||||||||||
Preferred stock dividend
|
- | - | - | - | (87,457 | ) | (87,457 | ) | ||||||||||||||||
Balance at December 31, 2011
|
4,291,620 | $ | 4,946 | $ | (473 | ) | $ | 4,542,646 | $ | ( 6,015,644 | ) | $ | (1, 468,525 | ) |
Year ended
December 31,
2011
|
Year ended
December 31,
2010
|
|||||||
Cash flow from operating activities
|
||||||||
Net loss
|
$ | (2,1 52,923 | ) | $ | (8 64,882 | ) | ||
Adjustments for non-cash items:
|
||||||||
Depreciation
|
67,383 | 64,012 | ||||||
Amortization
|
51,684 | 51,683 | ||||||
Stock based compensation payments
|
375,830 | 500,504 | ||||||
Changes in operating assets and liabilities:
|
||||||||
Decrease/(increase) in accounts receivable
|
233,983 | (30,368 | ) | |||||
(Increase)/decrease in prepaid expenses
|
(12,606 | ) | 43,718 | |||||
Increase in accounts payable
|
281,824 | 248,662 | ||||||
Increase in other payables and accrued expenses
|
21,219 | |||||||
Net cash (utilized)/provided by operating activities
|
(1,133,606 | ) | 13,329 | |||||
Investing activities
|
||||||||
Purchase of plant and equipment
|
(56,056 | ) | (6,144 | ) | ||||
Net cash used in investing activities
|
(56,056 | ) | (6,144 | ) | ||||
Financing activities
|
||||||||
Advance on line of credit, net
|
- | 35,997 | ||||||
Repayment of line of credit
|
(87,784 | ) | - | |||||
Repayment of loan payable
|
(28,300 | ) | (30,469 | ) | ||||
Repayment of stockholders loan
|
(77,600 | ) | (7,339 | ) | ||||
Loan advanced by stockholder
|
- | 66,600 | ||||||
Proceeds on Series “A” Preferred stock issued
|
1,889,650 | - | ||||||
Proceeds on Common stock options exercised
|
54,559 | - | ||||||
Treasury stock purchases
|
(473 | ) | - | |||||
Net cash provided by financing activities
|
1,750,052 | 64,789 | ||||||
Net increase in cash
|
560,390 | 71,974 | ||||||
Cash at the beginning of the period
|
117,910 | 45,936 | ||||||
Cash at the end of the period
|
$ | 678,300 | $ | 117,910 | ||||
Supplemental disclosure of cash flow information
|
||||||||
Cash paid for:
|
||||||||
Interest
|
$ | 16,376 | $ | 20,203 | ||||
Non cash investing and financing activities:
|
||||||||
Common stock issued for settlement of debt
|
$ | - | $ | 34,040 | ||||
Deemed preferred stock dividend relating to warrants issued to preferred stockholders
|
$ | 115,385 | $ | - |
1.
|
GENERAL INFORMATION
|
2.
|
ACCOUNTING POLICIES AND ESTIMATES
|
2.
|
ACCOUNTING POLICIES AND ESTIMATES (continued)
|
2.
|
ACCOUNTING POLICIES AND ESTIMATES (continued)
|
2.
|
ACCOUNTING POLICIES AND ESTIMATES (continued)
|
a)
|
License Agreements
|
b)
|
Amortization |
2.
|
ACCOUNTING POLICIES AND ESTIMATES (continued)
|
Leasehold improvements | 5 Years |
Laboratory equipment | 7 Years |
Furniture and fixtures | 10 Years |
Computer equipment | 3 Years |
December 31,
2011
|
December 31,
2010
|
|||||||
Department of Defense
|
$ | 173,242 | $ | 1,028,809 | ||||
National Institutes of Health
|
312,874 | 406,983 | ||||||
Federal Government Grants
|
38,688 | 205,790 | ||||||
Other
|
30,000 | - | ||||||
$ | 554,804 | $ | 1,641,582 |
2.
|
ACCOUNTING POLICIES AND ESTIMATES (continued)
|
2.
|
ACCOUNTING POLICIES AND ESTIMATES (continued)
|
2.
|
ACCOUNTING POLICIES AND ESTIMATES (continued)
|
3.
|
GOING CONCERN
|
4.
|
INTANGIBLE ASSETS
|
●
|
Method for Detecting Binding Events Using Micro X-Ray Fluorescence Spectrometry;
|
●
|
Flow Method and Apparatus for Screening Chemicals Using Micro X-Ray Fluorescence;
|
●
|
Method and Apparatus for Detecting Chemical Binding;
|
●
|
Drug Development and Manufacturing.
|
4.
|
INTANGIBLE ASSETS (continued)
|
Amount
|
||||
2012
|
$ | 50,000 | ||
2013
|
50,000 | |||
2014
|
50,000 | |||
2015
|
50,000 | |||
2016 and thereafter
|
350,000 | |||
Total
|
$ | 550,000 |
December 31,
2011
|
December 31,
2010
|
|||||||
Licenses, at cost
|
$ |
9 72,000
|
$ |
972 ,000
|
||||
Less: Accumulated amortization
|
( 325,742
|
) |
( 274,058
|
) | ||||
$ |
646,258
|
$ |
697,942
|
4.
|
INTANGIBLE ASSETS (continued)
|
Amount
|
||||
2012
|
$ |
51,684
|
||
2013
|
51,684
|
|||
2014
|
51,684
|
|||
2015
|
51,684
|
|||
2016
|
51,684
|
|||
2017 and thereafter
|
387,838
|
|||
Total
|
$ |
646,258
|
●
|
Well Plate – apparatus for preparing samples for measurement by x-ray fluorescence spectrometry. Patent filed August 15, 2008
|
●
|
Method and Apparatus for measuring Protein Post Translational Modification. Patent filed September 26, 2008.
|
●
|
Method and Apparatus for Measuring Analyte Transport across barriers. Patent filed July 1, 2009.
|
5.
|
PLANT AND EQUIPMENT
|
December 31,
2011
|
December 31,
2010
|
|||||||
Leasehold improvements
|
$ | 6,393 | $ | 6,393 | ||||
Furniture and fittings
|
7,114 | 7,114 | ||||||
Laboratory equipment
|
462,434 | 413,269 | ||||||
Computer equipment
|
29,330 | 22,439 | ||||||
Total
|
505,271 | 449,215 | ||||||
Accumulated depreciation
|
(261,493 | ) | (194,110 | ) | ||||
$ | 243,778 | $ | 255,105 |
6.
|
OTHER PAYABLES AND ACCRUED EXPENSES
|
December 31,
2011
|
December 31,
2010
|
|||||||
Credit card liabilities
|
$ | 15,750 | $ | 2,342 | ||||
Vacation and Sick Pay accrual
|
100,771 | 85,228 | ||||||
Payroll liabilities
|
28,202 | 28,489 | ||||||
Other
|
2,100 | 9,545 | ||||||
$ | 146,823 | $ | 125,604 |
7 .
|
INCOME TAXES
|
December 31,
2011
|
December 31,
2010
|
|||||||
Income tax benefit at federal statutory rate
|
$ |
(7 53,383
|
) | $ | (302,709 | ) | ||
State taxes, net of federal benefit
|
(10 7,626
|
) | (43,244 | ) | ||||
Other
|
(9,813
|
) | (53,748 | ) | ||||
Stock based compensation
|
150,322
|
200,201 | ||||||
(720,500 | ) | (199,500 | ) | |||||
Valuation allowances
|
720,500 | 199,500 | ||||||
$ | - | $ | - |
December 31,
2011
|
December 31,
2010
|
|||||||
Deferred tax assets
|
||||||||
Accrual to cash adjustments
|
$ | 269,000 | $ | 60,000 | ||||
Plant and equipment
|
21,000 | 10,500 | ||||||
Net operating loss
|
1,203,000
|
697,000 | ||||||
1,493,000
|
767,500 | |||||||
Valuation allowance
|
(1,416,000
|
) | (695,500 | ) | ||||
Net Amortization
|
77,000
|
72,000 | ||||||
Deferred tax liabilities
|
||||||||
Accrual to cash adjustments
|
(77,000 | ) | (72,000 | ) | ||||
$ | - | $ | - | |||||
7.
|
INCOME TAXES (continued)
|
8.
|
LOANS PAYABLE
|
December 31,
2011
|
December 31,
2010
|
|||||||
Short term portion
|
||||||||
Los Alamos County Loan
|
$ | 29,748 | $ | 28,300 | ||||
Los Alamos National Bank
|
- | 87,784 | ||||||
29,748 | 116,084 | |||||||
Long term portion
|
||||||||
Los Alamos County Loan
|
241,204 | 270,952 | ||||||
$ | 270,952 | $ | 387,036 |
Amount
|
||||
2012
|
$ | 29,748 | ||
2013
|
31,270 | |||
2014
|
32,869 | |||
2015
|
34,551 | |||
2016
|
36,319 | |||
2017 and thereafter
|
106,195 | |||
Total
|
$ | 270,952 |
8.
|
LOANS PAYABLE (continued)
|
9.
|
OTHER STOCKHOLDERS’ EQUITY
|
9.
|
OTHER STOCKHOLDERS’ EQUITY (continued)
|
10.
|
COMMON STOCK
|
10.
|
COMMON STOCK (continued)
|
11.
|
WARRANTS
|
Year ended
December 31,
2011
|
Year ended
December 31,
2010
|
|||||||
Risk-free interest rate
|
0.01% to 0.15
|
% |
0.04% to 0.15
|
% | ||||
Expected life of the warrants
|
5 Years
|
5 Years
|
||||||
Expected volatility of the underlying stock
|
128 | % | 128 | % | ||||
Expected dividend rate
|
0 | % | 0 | % |
Warrants
|
Exercise Price
|
Expiration Date
|
||
22,272
|
$5.70
|
March 2016
|
||
108,983
|
$5.70
|
April 2016
|
||
86,404
|
$5.70
|
May 2016
|
||
35,000
|
$5.70
|
June 2016
|
||
40,000
|
$5.70
|
July 2016
|
||
35,088
|
$5.70
|
September 2016
|
||
46,572
|
$5.70
|
October 2016
|
||
15,000
|
$2.00
|
October 2016
|
||
389,319
|
12.
|
STOCK BASED COMPENSATION
|
Year ended
December 31,
2011
|
Year ended
December 31,
2010
|
|||||||
Risk-free interest rate
|
0.01% to 0.15
|
% |
0.04% to 0.15
|
% | ||||
Expected life of the options
|
5 Years
|
5 Years
|
||||||
Expected volatility of the underlying stock
|
128 | % | 128 | % | ||||
Expected dividend rate
|
0 | % | 0 | % |
12.
|
STOCK BASED COMPENSATION (continued)
|
Shares
|
Exercise price
per share
|
Weighted average
exercise price
|
||||||||||
Outstanding, January 1, 2010
|
277,688 | $ | 2.00 - $5.71 | $ | 4.77 | |||||||
Granted
|
65,000 | $ | 5.71 | $ | 5.71 | |||||||
Forfeited/Cancelled
|
(57,188 | ) | $ | 2.00 - $5.71 | $ | 4.09 | ||||||
Exercised
|
- | - | - | |||||||||
Outstanding December 31, 2010
|
285,500 | $ | 2.00 - $5.71 | $ | 5.13 | |||||||
Granted
|
477,500 | $ | 1.10 - $5.71 | $ | 1.46 | |||||||
Forfeited/Cancelled
|
(235,000 | ) | $ | 1.10 - $5.71 | $ | 1.16 | ||||||
Exercised
|
(9,555 | ) | $ | 5.71 | $ | 5.71 | ||||||
Outstanding December 31, 2011
|
518,445 | $ | 1.10 - $5.71 | $ | 3.54 |
Options Outstanding
|
Options Exercisable
|
|||||||||||||||||||||
Exercise Price
|
Number of shares
|
Weighted average remaining contractual years
|
Weighted Average Exercise Price
|
Number of Shares
|
Weighted Average exercise Price
|
|||||||||||||||||
$ | 1.10 | 220,000 | 9.17 | $ | 1.10 | 220,000 | $ | 1.10 | ||||||||||||||
$ | 2.00 | 30,000 | 3.92 | $ | 2.00 | 30,000 | $ | 2.00 | ||||||||||||||
$ | 5.71 | 268,445 | 6.70 | $ | 5.71 | 228,570 | $ | 5.71 | ||||||||||||||
518,445 | 7.59 | $ | 3.54 | 478,570 | $ | 3.36 |
13.
|
NET LOSS PER COMMON SHARE
|
Year ended
December 31,
2011
(Shares)
|
Year ended
December 31,
2010
(Shares)
|
|||||||
Options to purchase shares of common stock
|
518,445 | 285,500 | ||||||
Series “A” Convertible Preferred stock
|
331,519 | - | ||||||
Warrants
|
389,319 | - | ||||||
1,239,283 | 285,500 |
14.
|
RELATED PARTY TRANSACTIONS
|
December 31,
2011
|
December 31,
2010
|
|||||||
Short term loans
|
||||||||
Benjamin P Warner
|
$ | - | $ | 77,600 | ||||
$ | - | $ | 77,600 |
15.
|
OPERATING LEASES
|
Amount
|
||||
2012
|
$ | 95,426 | ||
2013
|
50,753 | |||
Total
|
$ | 146,179 |
16.
|
LITIGATION
|
16.
|
LITIGATION (continued)
|
17.
|
SUBSEQUENT EVENTS
|
SEC registration fee
|
$
|
806.48
|
||
Accounting fees and expenses
|
10,000
|
|||
Legal fees and expenses
|
|
25,000
|
||
Printing and related expenses
|
|
5,000
|
||
Transfer agent fees and expenses
|
2,000
|
|||
Miscellaneous
|
2,193.52
|
|||
Total
|
$
|
45,000
|
●
|
diluting the voting or other rights of the proposed acquirer or insurgent stockholder group;
|
●
|
putting a substantial voting block in institutional or other hands that might undertake to support the incumbent board of directors; or
|
●
|
effecting an acquisition that might complicate or preclude the takeover.
|
Exhibit No.
|
Description
|
3.1
|
Certificate of Incorporation dated November 12, 2003*
|
3.2
|
First Amended and Restated Certificate of Incorporation dated March 8, 2011*
|
3.3
|
Certificate of Designations dated March 14, 2011*
|
3.4
|
By-Laws*
|
3.5
|
Second Amended and Restated Certificate of Incorporation dated April 10, 2012 *
|
4.1
|
Form of Warrant to Purchase Common Stock*
|
4.2
|
Promissory Note, dated September 21, 2006, in the principal amount of $2,200,000 payable to the Incorporated County of Los Alamos*
|
4.3
|
Stock Option Plan*
|
4.4 |
List of Warrant Holders*
|
5.1
|
Opinion of Gracin & Marlow, LLP *
|
10.1
|
Employment Agreement with Dr. Benjamin Warner*
|
10.2
|
Employment Agreement with Lori Peterson
(nee Court )
*
|
10.3
|
Exclusive Patent License Agreement, dated September 8, 2005, by and between the Company and The Regents of the University of California **(Portions of the exhibit have been omitted pursuant to a request for confidential treatment. The omitted portions have been filed with the Commission.)
|
10.4
|
Project Participation Agreement, dated as of September 21, 2006, by and between the Company and the Incorporated County of Los Alamos*
|
10.5
|
Amendment No. 1 to Participation Agreement, dated as of February 21, 2007, by and between the Company and the Incorporated County of Los Alamos*
|
10.6 |
OEM Agreement, dated July 5, 2011, by and between the Company and Bruker Nano GmbH **(Portions of the exhibit have been omitted pursuant to a request for confidential treatment. The omitted portions have been filed with the Commission.)
|
10.7 |
Assignment of Exclusive License Agreement by The Regents of the University of California to Los Alamos National Security, LLC *
|
10.8 |
Lease Agreement with Reeves & Associates, LLC in connection with Suite C *
|
10.9 |
Lease Agreement with Reeves & Associates, LLC in connection with Suite D *
|
10.10 |
Extension and Modification of Lease Agreements *
|
10.11 |
2005 Option Plan*
|
10.12 |
Contract 2R44AI079935-03 with the National Institutes of Health; to develop strontium-selective therapies, contract amount: $3,000,000.00, operative from 08/24/2011 - 07/31/2014, $184,954.01 .*
|
10.13 |
Contract 1R43GM090387-01 with the National Institutes of Health; to develop assays for carcinogens, contract amount: $200,000.00, operative from 08/06/2010 - 08/05/2012 .*
|
21.1
|
List of subsidiaries*
|
23.1
|
Consent of Registered Public Accounting Firm **
|
23.2
|
Consent of Gracin & Marlow, LLP (included in Exhibit 5.1)*
|
CALDERA PHARMACEUTICALS, INC.
|
||
By:
|
/s/ Dr. Benjamin Warner
|
|
Dr. Benjamin Warner, Chief Executive Officer, Chief Financial Officer , Principal Accounting Officer and Director
|
Signature
|
Title
|
Date
|
||
/s/ Dr. Benjamin Warner
|
Chief Executive Officer and Director
|
June 8, 2012
|
||
Dr. Benjamin Warner
|
(Principal Executive Officer , Principal Financial Officer and Principal Accounting Officer )
|
|||
/s/ Jeremiel Zimmerman
|
Director
|
June 8, 2012
|
||
Jeremiel Zimmerman
|
/s/ Edward Roffman
|
Director
|
June 8, 2012
|
||
Edward Roffman
|
I. DEFINITIONS
|
3
|
2. GRANT
|
5
|
3. SUBLICENSES
|
5
|
4. FEES AND ROYALTIES
|
6
|
5. DILIGENCE
|
7
|
6. PROGRESS REPORTS
|
8
|
7. BOOKS AND RECORDS
|
8
|
8. TERM OF THE LICENSE AGREEMENT
|
9
|
9. TERMINATION BY THE UNNERSITY
|
9
|
10. TERMINATION BY THE LICENSEE
|
10
|
11. PATENT PROSECUTION, MAINTENANCE AND DISCLAIMER
|
10
|
12. USE OF NAMES, TRADENAMES AND TRADEMARKS
|
11
|
13. WARRANTY AND DISCLAIMER
|
12
|
14. INFRINGEMENT
|
13
|
15. WAIVER
|
14
|
16. ASSIGNABILITY
|
14
|
17. INDEMNIFICATION
|
14
|
18. LATE PAYMENTS
|
15
|
19. NOTICES
|
16
|
20. FORCE MAJEURE
|
16
|
21. EXPORT CONTROL LAWS
|
17
|
22. PREFERENCE FOR UNITED STATES INDUSTRY
|
17
|
23. DISPUTE RESOLUTION
|
17
|
24. PATENT MARKING
|
17
|
25. GOVERNING LAW
|
17
|
26. SURVIVAL
|
17
|
27. GOVERNMENT APPROVAL OR REGISTRATION
|
18
|
28. DISPOSITION OF LICENSED PRODUCTS AND LICENSED SERVICES
|
18
|
29. MISCELLANEOUS
|
18
|
APPENDIX A -PATENT RIGHTS
|
21
|
APPENDIX B -FEES AND ROYALTIES
|
23
|
FEES AND ROYALTIES
|
23
|
APPENDIX C -MILESTONES
|
26
|
APPENDIX D -REPORT FORMAT
|
27
|
APPENDIX E -ROYALTY REPORT FORMAT
|
28
|
Article 1
|
DEFINITIONS
|
Article 3
|
SUBLICENSES
|
Article 7
|
BOOKS AND RECORDS
|
Article 11
|
PATENT PROSECUTION, MAINTENANCE AND DISCLAIMER
|
Article 12
|
USE OF NAMES, TRADENAMES, AND TRADEMARKS
|
Article 13
|
WARRANTY AND DISCLAIMER
|
Article 17
|
INDEMNIFICATION
|
Article 18
|
LATE PAYMENTS
|
Article 26
|
SURVIVAL
|
Country
|
Application No.
|
Filing Date
|
Japan
|
||
European Patent Office
|
||
Country
|
Application No.
|
Filing Date
|
Japan
|
||
European Patent Office
|
||
Country
|
Application No.
|
Filing Date
|
Japan
|
||
European Patent Office
|
||
February 28, 2006
|
$25,000.00
|
February 28, 20 15
|
$50,000.00
|
February 28, 2007
|
$25,000.00
|
February 28, 20 16
|
$50,000.00
|
February 28, 2008
|
$25,000.00
|
February 28, 2017
|
$50,000.00
|
February 28, 2009
|
$25,000.00
|
February 28, 20 18
|
$50,000.00
|
February 28, 2010
|
$25,000.00
|
February 28, 20 19
|
$50,000.00
|
February 28
,
2011
|
$50,000.00
|
February 28, 2020
|
$50,000.00
|
February 28, 2012
|
$50,000.00
|
February 28, 202 1
|
$50,000.00
|
February 28, 2013
|
$50,000.00
|
February 28, 2022
|
$50,000.00
|
February 28, 2014
|
$50,000.00
|
Preamble
|
3
|
|
1
|
Definitions
|
3
|
2
|
Development of M4 BIO
|
3
|
3
|
Promotion and Sale of XRPro
|
4
|
4
|
M4 BIO Lead Time, Delivery, Forecasting
|
4
|
5
|
M4 BIO Prices and Payment Terms
|
5
|
6
|
M4 BIO Warranty
|
6
|
7
|
XRPro Installation
|
6
|
8
|
XRPro Technical Service and System Maintenance
|
6
|
9
|
Non-Competition
|
6
|
10
|
Confidentiality
|
7
|
11
|
Limitation of Liability
|
7
|
12
|
Duration of Agreement, Termination
|
8
|
13
|
Assignment
|
9
|
14
|
Notices
|
9
|
15
|
Arbitration
|
10
|
16
|
Applicable Law
|
10
|
17
|
Protection of Goodwill of Products; Compliance with Law
|
10
|
18
|
Written Form
|
10
|
19
|
Legally Void or Unfeasible Provisions
|
10
|
I.
|
Bruker is engaged in the development, manufacture and sales of complete systems and components for micro- and nanoanalysis on electron microscopes (EDS, EBSD) as well as X-ray fluorescence spectrometry (small spot- and µXRF, TXRF). In particular Bruker is offering the M4 TORNADO, a high performance desk top µXRF analyzer with large sample chamber, high-speed XYZ-stage and spot size of < 100 µm.
|
II.
|
Caldera pioneers in high-throughput label-free measurement of protein-drug binding and has developed a unique technology that is based on direct chemical analysis of protein-drug combinations by means of micro X-ray fluorescence (µXRF) spectroscopy. To date Caldera is offering its customers analytical services using its technology. An essential part of the technology is a desk top µXRF analyzer that Caldera used to source from third party vendors.
|
III.
|
Recently, Caldera is faced with an increasing demand for a product from its customers, who are interested in establishing this technology in their own labs, rather than just buying the analyical service from Caldera. Caldera is therefore seeking to create a commercial product as a combination of a µXRF analyzer and Caldera’s technology.
|
IV.
|
This OEM Agreement is intended to stipulate the terms and conditions under which
|
a.
|
Bruker shall develop a customized version of the M4 TORNADO that meets the application specific requirements of Caldera’s technology,
|
b.
|
Bruker shall manufacture and sell to Caldera the customized version of the M4 TORNADO,
|
c.
|
Caldera shall promote, sell and support the product based on the customized version of the M4 TORNADO,
|
d.
|
Bruker shall provide technical repair and maintenance service to Caldera’s customers.
|
1.
|
Definitions
|
1.1
|
The term “
M4 BIO
” means the customized version of the M4 TORNADO that meets the application specific requirements of Caldera’s technology, consisting of hardware and software as specified in Annex 1 to this Agreement.
|
1.2
|
The term “
XRPro
” means the commercial product to be created by the Parties, incorporating the M4 Bio from Bruker and Caldera’s technology.
|
2.
|
Development of M4 BIO
|
2.1.
|
The Parties are in agreement that to the best of their knowledge the hardware and software specifications given in Annex 1 to this Agreement represent the complete and correct description of the M4 BIO.
|
2.2.
|
Bruker undertakes to develop and implement the modifications and/or additional features to the standard software of the M4 TORNADO, necessary to meet the M4 BIO specifications as set out in Annex 1, within 3 months after the signing of this Agreement.
|
2.3.
|
Bruker’s costs related to the development of the M4 BIO shall be borne by Bruker.
|
2.4.
|
Upon completion of the development Bruker shall provide Caldera with a prototype M4 BIO on a loan basis. The terms and conditions of the loan will be agreed between the Parties in a separate loan agreement.
|
2.5.
|
If after delivery and test by Caldera of the prototype M4 BIO, Caldera should come to the conclusion that the software provided by Bruker is not fully meeting Caldera’s actual requirements, because
|
a)
|
in Caldera’s understanding the functionality as described in Annex 1 has not been realized by Bruker to its full extent, or
|
b)
|
the description of the required M4 BIO functionality as set out in Annex 1 was not entirely complete and correct,
|
2.6.
|
If future technical progress and/or further development result in variations to the specification of the M4 BIO, or if such variations become necessary for other reasons, then Bruker shall notify Caldera in writing of such variations. The Parties shall then agree on an alteration or an amendment of this Agreement with respect to the specification, the pricing and the time schedule for the variation to become effective.
|
2.7.
|
In the event that future alterations of the M4 BIO with respect to design or specification are desired by Caldera, then Caldera shall request such alterations in writing and provide Bruker with full particulars of such alterations. Provided that such requested alteration is technically feasible and economically reasonable, the Parties shall then agree on an alteration or an amendment of this Agreement with respect to the specification, the pricing and the time schedule for the alteration to become effective.
|
3.
|
Promotion and Sale of XRPro
|
3.1.
|
Caldera will be responsible for worldwide marketing and sales of the XRPro.
|
3.2.
|
Subject to revocation by Bruker at any time, the XRPro shall be co-labeled with both Bruker’s and Caldera’s corporate logos, and Caldera shall be permitted to use the trademark Bruker and trademarks registered in Bruker's name for advertising and promotional purposes, provided that Caldera observes the applicable Bruker directives and uses only those trademark designs approved in writing in advance by Bruker. However Caldera shall not file for registration trade marks of Bruker in its own name. Upon request by Bruker or if required by law, Bruker and Caldera shall conclude a separate trademark license agreement.
|
3.3.
|
Caldera shall not assume obligations in the name of or on the account of Bruker and shall not make any representations or warranties on behalf of Bruker, except as expressly authorized by Bruker in writing.
|
3.4.
|
Caldera shall be deemed at all times to be an independent contractor and nothing contained herein shall be deemed to create the relationship of employer and employee or joint venture between Caldera and Bruker.
|
3.5.
|
Caldera shall strictly comply with all laws and regulations regarding the performance of its activities under this Agreement.
|
4.
|
M4 BIO Lead Time, Delivery, Forecasting
|
4.1.
|
The delivery of M4 BIO by Bruker to Caldera is subject to the conditions specified in "General Terms and Conditions of Bruker Nano GmbH“, attached as Annex 3 to this Agreement, unless otherwise provided for in this Agreement or in special conditions, as agreed upon, applicable to certain products, systems or services, types of business or special transactions.
|
4.2.
|
Bruker shall deliver M4 BIO upon the receipt of written purchase orders from Caldera. On the order sheet Caldera will indicate the complete customer details (address, telephone, fax, e-mail) as prerequisite for customer service by Bruker.
|
4.3.
|
Standard lead time for the Product is XXXX from receipt and acceptance of order.
|
4.4.
|
Bruker will shorten the lead time to XXXX if Caldera provides a 6 months rolling forecast on a monthly basis. Caldera will work closely with Bruker to manage a forecast and supply process to enable both Parties to profitably engage with all customer opportunities and required deliveries. Bruker will ensure capacity and production slots to meet this forecast. Each month Bruker and Caldera will review the planned capacity and capability to react to additional orders for the subsequent 6 calendar months.
|
4.5.
|
Delivery shall be DAP to the delivery address specified on the purchase order.
|
5.
|
M4 BIO Prices and Payment Terms
|
5.1.
|
The configurations and prices for the M4 BIO, related options and services are given in Annex 1 to this Agreement. All prices are XXXX exclusively for the purpose of this Agreement. XXXX.
|
5.2.
|
XXXX will be applied to the transfer prices as the total XXXX as per the table below.
|
Quantity sold
|
1-10
|
11-20
|
>20
|
XXXX
|
XXXX
|
XXXX
|
XXXX
|
5.3.
|
The XXXX will be reviewed annually.
|
5.4.
|
Bruker shall invoice Caldera
|
a)
|
XXXX upon receipt of the purchase order;
|
b)
|
XXXX upon delivery;
|
c)
|
XXXX upon installation and acceptance at the customer.
|
5.5.
|
Bruker shall retain title to the goods until payment in full for all deliveries. Caldera may resell the goods in the ordinary course of business and thereby assigns to Bruker as security all debts or claims arising from such resale.
|
6.
|
M4 BIO Warranty
|
6.1.
|
Bruker warrants the M4 BIO to be free of defects in workmanship and materials when used under normal operating conditions and when applied in accordance with specifications. The warranty period for M4 BIO is 12 months from the date of installation of the XRPro at customer’s site, maximum 15 months from the date of shipment of the M4 Bio from Bruker to Caldera or the customer (Warranty Period).
|
6.2.
|
During the Warranty Period all costs related to the making good of any defect shall be borne by Bruker, including any costs of the transport of defective items to be returned to Bruker and their return to Caldera or to the customer. This provision does not apply to products which exhibit a failure as a result of any act of negligence or omission by Caldera, its agents, representatives, its customers or any other third party.
|
7.
|
XRPro Installation
|
7.1.
|
Installation of XRPro systems and user training shall be provided by local Caldera or Caldera Local Rep service engineers, provided such engineers have been trained by Bruker and have obtained a certificate for M4 BIO installation and operation.
|
7.2.
|
In case no certified Caldera or Caldera Local Rep engineer is available locally, installation and user training shall be done by a local Bruker engineer. Additional charges apply for the installation and training of the end user by Bruker personnel according to the M4 BIO Service Price List given in Annex 2 to this Agreement.
|
8.
|
XRPro Technical Service and System Maintenance
|
8.1.
|
Caldera shall provide the first line service contact to its XRPro customers.
|
8.2.
|
If the initial diagnosis by Caldera suggests that a failure is related to the M4 BIO, Caldera shall notify the local Bruker Service in writing as soon as it is reasonably able. Bruker shall provide Caldera with contact details of local Bruker Service for each country or territory in which the XRPro has been installed.
|
8.3.
|
Based on the customer’s / Caldera’s failure report, and supported by further investigations via telephone or on-site if necessary, Bruker Service shall provide a quote for the repair to the customer / Caldera. Upon receipt of the purchase order from the customer / Caldera Bruker Service shall repair the defective M4 BIO. Prices and rates for repair services are provided in Annex 2 to this Agreement.
|
8.4.
|
Bruker offers Caldera / Caldera’s customers service contracts for the M4 BIO at different price / performance levels as set out in Annex 2 to this Agreement. Services provided by Bruker under service contracts and prices of service contracts may be country specific.
|
9.
|
Non-Competition
|
9.1.
|
Caldera shall not, without the prior written consent of Bruker
|
a)
|
copy the M4 BIO or parts thereof;
|
b)
|
develop, manufacture, act as intermediary for, or distribute products that compete directly or indirectly with the M4 BIO or parts thereof.
|
9.2.
|
Bruker shall not, without the prior written consent of Caldera
|
a)
|
make the M4 BIO available to any third party that competes directly or indirectly with Caldera;
|
b)
|
make any attempts to market and sell the XRPro directly to end users.
|
9.3.
|
If this Agreement is terminated by either Party, the provisions of this Section 9 shall remain in force for a period of three years subsequent to the termination of this Agreement; except that if Bruker terminates the agreement, Subsection 9.1 shall be voided, and if Caldera terminates the agreement, Subsection 9.2 shall be voided.
|
9.4.
|
If future technical progress or further business development requires the necessity to change the specifications of the M4 BIO, replace the M4 BIO with a next generation machine, or expand the XRpro product line with x-ray fluorescence equipment with greater or lesser capabilities than are provided by the M4 BIO, then Bruker shall have the right of first refusal to manufacture the x-ray fluorescence equipment. Bruker shall notify Caldera within 30 days of its election to manufacture the x-ray fluorescence equipment. Should Bruker elect not to manufacture the x-ray fluorescence equipment, then Caldera can make or have made the equipment without violating the provisions of Section 9.
|
10.
|
Confidentiality
|
10.1.
|
Either Party hereby undertakes to:
|
|
a)
|
keep confidential all information (written or oral) concerning the business and affairs of the other Party that it shall have obtained or received as a result of discussions leading up to or the entering into or in the performance of this Agreement. (the “Information”);
|
|
b)
|
not without the other Party's written consent disclose the information in whole or in part to any other person save those of its employees involved in the performance of this Agreement to whom such disclosure is necessary; and
|
|
c)
|
use the Information solely in connection with the performance of this Agreement and not for its own or the benefit of any other third party.
|
10.2.
|
The provisions of subsection 10.1. shall not apply to the whole or any part of the Information to the extent that is:
|
|
a)
|
trivial or obvious;
|
|
b)
|
in the public domain;
|
10.3.
|
The terms of this Section 10 shall survive the termination of this Agreement.
|
11.
|
Limitation of Liability
|
11.1.
|
Bruker shall not be responsible for the XRPro sold by Caldera or for claims of third parties with respect to the XRPro, if such claims are on account of failure on the part of Caldera to comply with all the terms and conditions of this Agreement.
|
11.2.
|
Caldera shall be fully responsible for test and supply of the XRPro to its customers as well as for sourcing parts and components required for the assembly and test of the XRPro including the procurement of the M4 BIO from Bruker.
|
11.3.
|
Caldera shall at its cost and expenses obtain all licenses, consents and sanctions from the Government of the concerned country and other authorities, agencies and bodies, necessary or required during the continuance of this Agreement for importing the M4 BIO from Bruker and the manufacture and selling of XRPro in accordance with the terms of this Agreement.
|
11.4.
|
Neither Party to this Agreement shall be liable for any failure or delay on its part in performing any of its obligations under this Agreement or for any losses, damages, costs, charges or expenses incurred or suffered by the other Party by reason of such failure or delay, if and so far as such failure or delay shall be arising out of Force Majeure.
|
11.5.
|
Bruker shall solely be responsible for and shall indemnify Caldera against all claims, expenses, losses and damages arising out of defects in the M4 BIO used in the assembly of the XRPro, provided that such defects are notified to Bruker in writing in accordance with Section 8.2. above, however no later than within 15 months of date of shipment of the relevant M4 BIO by Bruker.
|
11.6.
|
XXXX shall be liable to pay to XXXX, other than for reasons mentioned in Section XXXX. above and XXXX, or such larger or extended periods as maybe mutually agreed between the Parties in writing, from the delivery date originally specified by XXXX, provided however that such XXXX.
|
11.7.
|
Bruker's liability arising out of or in connection with the supply or non supply of any M4 BIO or other defect or unsafe condition with respect to that M4 BIO, shall be limited to XXXX
|
11.8.
|
Caldera shall solely be responsible for and indemnify Bruker against all claims or losses incurred due to improper working of the safety features of the XRPro including any amount claimed in the event of any accident caused by such improper working of the safety features, where such improper working has occurred on account of failure of Caldera to comply with the terms and conditions of this Agreement.
|
12.
|
Duration of Agreement, Termination
|
12.1.
|
This Agreement shall become effective upon its signing and shall remain in force for an indefinite period of time. Either Party may terminate this Agreement without cause by giving the other Party six (6) months prior written notice.
|
12.2.
|
Notwithstanding the provisions of Subsection 12.1., either Party is entitled to terminate this Agreement prematurely and with immediate effect for important reasons.
|
a)
|
due to Force Majeure, or other circumstance beyond a Party's reasonable control, the Party's performance under this Agreement is hindered for more than six (6) months;
|
b)
|
a Party violates the provisions of Section 9;
|
c)
|
a petition is filed against a Party under the provisions of the laws of insolvency or bankruptcy;
|
d)
|
a Party is in serious arrears with respect to its payment commitments (payments due of USD 100,000 or more after having received a reminder) or otherwise materially breaches this Agreement so that the other Party's adherence to this Agreement cannot reasonably be expected;
|
e)
|
Caldera violates the applicable export laws and regulations (refer to Section 16).
|
12.3.
|
Caldera shall ensure that, upon termination of this Agreement, all sub-agreements entered into by it shall be cancelled such that, to the extent feasible, they expire on the date of termination of this Agreement.
|
12.4.
|
A notice of termination shall not give cause for any claims for damages, indemnity or compensation unless the termination is due to reasons attributable to a Party.
|
13.
|
Assignment
|
14.
|
Notices
|
to Caldera : |
Benjamin P. Warner
Caldera Pharmaceuticals, Inc.
278-D DP Road
Los Alamos, NM 87544, USA
Tel : +1 505 412 2345
Fax : +1 302 347 1326
Email:
Warner@CPsci.com
|
|
to Bruker: |
Thomas Schuelein
Bruker Nano GmbH
Schwarzschildstrasse 12
12489 Berlin, Germany
Tel : +49 30 670 99 00
Fax : +49 30 670 99 030
Email:
Thomas.Schuelein@bruker-nano.de
|
15.
|
Arbitration
|
15.1.
|
The Parties shall make a good faith effort to settle amicably any dispute or difference arising out of or resulting from this Agreement and its Annexes or ancillary agreements regarding its performance. An attempt to arrive at a settlement shall be deemed to have failed as soon as one of the Parties to the Agreement so notifies the other Party in writing.
|
15.2.
|
If an attempt at settlement has failed, the dispute shall be resolved definitely and exclusively by the American Arbitration Association, in Chicago, Illinois, under the arbitration rules then in force. It is agreed that all documentary submissions, presentations, and proceedings shall be in the English language.
|
15.3.
|
The arbitral award shall be substantiated in writing. The decision of the arbitral tribunal shall be final and binding on the Parties, and judgment upon the arbitral award may be entered in any court having jurisdiction thereof. The arbitral tribunal shall assign the costs of arbitration.
|
16.
|
Applicable Law
|
17.
|
Protection of Goodwill of Products; Compliance with Law
|
17.1.
|
Neither party shall not make any statements, commit any acts or indulge in any business practices which might violate the laws of the United States or other countries, or injure or adversely affect the goodwill, standing or reputation of the other party or of its products.
|
17.2.
|
Caldera hereby acknowledges that Bruker seeks to comply with all applicable laws and regulations, including the United States Foreign Corrupt Practices Act. In furtherance of those efforts, Caldera hereby represents and warrants that, to the best of Caldera's knowledge based upon appropriate diligence and investigation:
|
a)
|
neither Caldera nor its employees or agents has paid or contributed, and will not pay or contribute, anything of value to any governmental entity or any of its employees or agents in exchange for doing business with Caldera or Bruker; and
|
b)
|
no contribution or payment by Caldera or any of its employees or agents in connection with this Agreement shall cause Bruker to be in violation of the United States Foreign Corrupt Practices Act, or any other applicable law or regulation.
|
17.3.
|
Caldera shall promptly notify Bruker if any of these representations cease to be true and accurate. Caldera understands that if at any time it is discovered that any of the foregoing representations are incorrect, or if otherwise required by applicable law or regulation, Bruker will undertake appropriate actions to ensure compliance with the applicable law or regulation.
|
18.
|
Written Form
|
19.
|
Legally Void or Unfeasible Provisions
|
Bruker Nano GmbH | Caldera Pharmaceuticals, Inc. | |
Signature | Signature |
Name | Name |