Total revenues for the year ended December 31, 2010 were $5,529,719
Liquidity and Capital Resources - Going concern
Our consolidated financial statements have been prepared assuming we will continue as a going concern. We have experienced net losses of $9,718,625 and $7,679,195 for the years ended December 31, 2010 and 2009, respectively. Our working capital deficit of $1,805,724, among other factors, raise substantial doubt about our ability to continue as a going concern. Our financial statements do not include any adjustment that might result from the outcome of this uncertainty. Assurances cannot be given that adequate financing can be obtained to meet our capital needs. If we are unable to generate profits and are unable to continue to obtain financing to meet our working capital requirements, we will have to sharply curtail our business or cease operations altogether. Our continuation as a going concern is dependent upon our ability to generate sufficient cash flow to meet our obligations on a timely basis, to obtain additional financing and, ultimately, to attain profitability. Presently, the Company is considering various alternatives, including pursuing private placement financings as well as various sales strategies to improve cash from operations, in order to provide for the future working capital needs of the Company. Should the Company not be able to fund its working capital needs through financings or increases in sales, we will be adversely affected and we will have to cease operations.
At December 31, 2010, we had an accumulated deficit of $28,777,476 and it is likely that we will incur additional losses in the future. While we have funded our operations since inception from operations and through private placements of equity securities and bridge loans, there can be no assurance that adequate financing will continue to be available to us and, if available, on terms that are favorable to us.
At December 31, 2010 and March 31, 2011 we had approximately $17,000 and $449,000, respectively, in cash, including the cash balance of C612, our 66% owned subsidiary, of $7,000 and $16,000 as of December 31, 2010 and March 31, 2011, respectively. Based on our current plans and assumptions, which include our expectations relating to the future sale of our equity and debt securities and entering into contracts for the financing and installation of solar energy systems and the resulting cash flows and revenues, we believe that we will have adequate resources to fund our operations in 2011. However, there can be no assurances that we will be successful in entering into such contracts or arranging financing on terms satisfactory to us, in which case there would be significant doubt as to our ability to continue as a going concern. Notwithstanding our sales of common stock, convertible notes with warrants and loans from an unrelated third party in 2009, 2010 and February 2011, we will need to raise additional funds to pay outstanding vendor invoices and operating expenses.
We may need to raise additional funds through either the licensing or sale of our technologies, products and services or the additional public or private offerings of our securities. There can be no assurance that we will be able to obtain further financing, do so on reasonable terms, or do so on terms that would not substantially dilute our current stockholders’ equity interests in us. If we are unable to raise additional funds on a timely basis, or at all, we may not be able to continue our operations.
We expect to put our capital resources, which included $17,000 and $449,000 of cash at December 31, 2010 and March 31, 2011, respectively, and anticipated net cash from the operations of the Company and the proceeds of the transaction described in Note 13 – Subsequent Events – to the following uses:
up to $400,000 for the commercialization of XTRAX;
possibly for strategic acquisitions, if and to the extent we determine appropriate; and
for general working capital purposes. |
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