NVUS 2018 Annual Report

Company will need to raise additional funds through public or private debt and equity financings or strategic collaboration and licensing arrangements. 7KH &RPSDQ\¶V DELOLW\ WR UDLVH DGGLWLRQDO FDSLWDO LQ WKH HTXLW\ DQG GHEW PDUNHWV LV GHSHQGHQW RQ a n XPEHU RI IDFWRUV LQFOXGLQJ EXW QRW OLPLWHG WR WKH PDUNHW GHPDQG IRU WKH &RPSDQ\¶V FRPPRQ VWRFN ZKLFK LWVHOI LV subject to a number of development and business risks and uncertainties, as well as the uncertainty that the Company would be able to raise such additional capital at a price or on terms that are favorable to the Company. If the Company issues equity or convertible debt securities to raise additional funding, its existing stockholders may experience dilution, it may incur significant financing costs, and the new equity or convertible debt securities may have rights, preferences and privileges senior to those of its existing stockholders. If the Company issues debt securities to raise additional funding, it would incur additional debt service obligations, it could become subject to additional restrictions limiting its ability to operate its business, and it may be required to further encumber its assets. Adequate additional funding may not be available to us on acceptable terms on a timely basis, or at all. If the Company is unable to obtain the necessary level of capital through external financing during the first half of 2019, as contemplated in its operating plan, the Company intends to implement certain cost cutting measures commencing in the first half of 2019 to reduce its cash flow requirements. Consistent with the actions the Company has taken in the past, it will execute the appropriate steps to enable the continued operations of the business and preservation of the value of its assets beyond the next twelve months, including but not limited to actions such as reduced personnel-related costs, delay or curtailment of the &RPSDQ\¶V UHVHDUFK DQG GHYHORSPHQW DFWLYLWLHV DQG RWKHU GLVFUHWLRQDU\ H[SHQVHV WKDW DUH ZLWKLQ WKH &RPSDQ\¶V control. 7KHVH LQLWLDWLYHV LI UHTXLUHG PD\ KDYH DQ DGYHUVH LPSDFW RQ WKH &RPSDQ\¶V DELOLW\ WR DFKLHYH FHUWDLQ RI LWV SODQQHG objectives during 2019 as it seeks strategic alternatives. At the time of issuance of the consolidated financial statements for the year ended December 31, 2018, the Company concluded that there is VXEVWDQWLDO GRXEW UHJDUGLQJ WKH &RPSDQ\¶V DELOLW\ WR FRQWLQXH DV D J oing concern for the twelve months from the date of issuance of the consolidated financial statements for the year ended December 31, 2018. The financial information and the consolidated financial statements included in this Annual Report have been prepared on a basis that assumes that we will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. This financial information and these financial statements do not include any adjustments that may result from an unfavorable outcome of this uncertainty. Our ability to continue as a going concern is dependent upon our ability to successfully secure sources of financing and ultimately achieve profitable operations. Use of Estimates 7KH SUHSDUDWLRQ RI WKH &RPSDQ\¶V consolidated financial statements in conformity with GAAP requires management to make informed estimates and assumptions that affect the reported amounts of assets, liabilities and expenses and the GLVFORVXUH RI FRQWLQJHQW DVVHWV DQG OLDELOLWLHV LQ WKH &RPSDQ\¶V consolidated financial statements and accompanying notes. 7KH PRVW VLJQLILFDQW HVWLPDWHV LQ WKH &RPSDQ\¶V ILQDQFLDO VWDWHPHQWV UHODWH WR VWRFN -based compensation, accruals for liabilities, carrying value of goodwill, and other matters that affect the consolidated financial statements and related disclosures. Actual results could differ materially from those estimates under different assumptions or conditions and the differences may be material to the consolidated financial statements. Cash and Cash Equivalents Cash represents cash deposits held at financial institutions. The Company considers all liquid investments purchased with an original maturity of three months or less and that can be liquidated without prior notice or penalty to be cash equivalents. The carrying value of cash equivalents approximate their fair value due to the short-term maturities of these instruments. Cash equivalents are held for the purpose of meeting short-term liquidity requirements, rather than for investment purposes. The Company had no cash equivalents at December 31, 2018 and 2017. Restricted Cash Restricted cash represents cash required to be set aside as security for lease payments or to maintain a letter of credit for WKH EHQHILW RI WKH ODQGORUG IRU WKH &RPSDQ\¶V offices. The Company had restricted cash of $0 and $70,000 at December 31, 2018 and 2017, respectively.

Fair Value Measurements

Financial assets and liabilities are recorded at fair value.

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