FieldPoint Petroleum Corporation
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS
|
For the Nine
Months Ended
|
|
|
|
|
|
|
|
|
CASH
FLOWS FROM OPERATING ACTIVITIES:
|
|
|
Net income
(loss)
|
$
2,239,240
|
$
(2,078,259
)
|
Adjustments to
reconcile net income (loss) to net cash used in operating
activities:
|
|
|
Depletion and
depreciation
|
538,573
|
895,400
|
Accretion of
discount on asset retirement obligations
|
78,000
|
82,000
|
Stock compensation
expense
|
-
|
13,750
|
Gain on sale of oil
and natural gas property
|
(3,203,670
)
|
-
|
Changes in current
assets and liabilities:
|
|
|
Accounts
receivable
|
(82,558
)
|
184,838
|
Prepaid income
taxes
|
(13,825
)
|
5,240
|
Prepaid expenses
and other current assets
|
(21,130
)
|
5,618
|
Accounts payable
and accrued expenses
|
23,035
|
31,554
|
Oil and gas
revenues payable
|
(19,769
)
|
(2,483
)
|
Net cash used in
operating activities
|
(462,104
)
|
(862,342
)
|
|
|
|
CASH
FLOWS FROM INVESTING ACTIVITIES:
|
|
|
Additions to oil
and natural gas properties and other equipment
|
(349,069
)
|
(96,618
)
|
Proceeds from sale
of oil and natural gas property
|
3,345,000
|
-
|
Net cash provided
by (used in) investing activities
|
2,995,931
|
(96,618
)
|
|
|
|
CASH
FLOWS FROM FINANCING ACTIVITIES:
|
|
|
Payments on line of
credit
|
(3,115,000
)
|
-
|
Net proceeds from
issuance of common stock
|
187,220
|
-
|
Net cash used in
financing activities
|
(2,927,780
)
|
-
|
|
|
|
NET
CHANGE IN CASH AND CASH EQUIVALENTS
|
(393,953
)
|
(958,960
)
|
|
|
|
CASH AND CASH EQUIVALENTS,
beginning of
the period
|
880,067
|
1,467,279
|
|
|
|
CASH AND CASH EQUIVALENTS,
end of the
period
|
$
486,114
|
$
508,319
|
|
|
|
SUPPLEMENTAL
INFORMATION:
|
|
|
Cash paid during
the period for interest
|
$
200,758
|
$
191,806
|
Cash paid during
the period for income taxes
|
$
13,100
|
$
2,174
|
Change in accrued
capital expenditures
|
$
69,591
|
$
54,932
|
See
accompanying notes to these unaudited condensed consolidated
financial statements
.
4
FieldPoint
Petroleum Corporation
NOTES
TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS
1.
Nature of Business, Organization and Basis of Preparation and
Presentation
FieldPoint
Petroleum Corporation (the “Company”,
“FieldPoint”, “our”, or “we”)
is incorporated under the laws of the state of Colorado. The
Company is engaged in the acquisition, operation and development of
oil and natural gas properties, which are located in Louisiana, New
Mexico, Oklahoma, Texas, and Wyoming.
The
condensed consolidated financial statements included herein have
been prepared by the Company, without audit, pursuant to the rules
and regulations of the Securities and Exchange Commission. Certain
information and footnote disclosures normally included in financial
statements prepared in accordance with U.S. generally accepted
accounting principles have been condensed or omitted. However, in
the opinion of management, all adjustments (which consist only of
normal recurring adjustments) necessary to present fairly the
financial position and results of operations for the periods
presented have been made. These condensed consolidated financial
statements should be read in conjunction with the consolidated
financial statements and the notes thereto included in the
Company's Form 10-K filing for the year ended December 31,
2016.
2.
Liquidity and Going Concern
Our
condensed consolidated financial statements for the nine months
ended September 30, 2017 and 2016, were prepared assuming that we
will continue as a going concern, which contemplates realization of
assets and the satisfaction of liabilities in the normal course of
business for the twelve-month period following the date of issuance
of these consolidated financial statements. Continued low oil and
natural gas prices during 2016 and 2017 have had a significant
adverse impact on our business, and as a result of our financial
condition, substantial doubt exists that we will be able to
continue as a going concern.
As of
September 30, 2017, and December 31, 2016, the Company has a
working capital deficit of approximately $3,666,000 and $6,629,000,
respectively, primarily due to the classification of our line of
credit as a current liability. The line of credit provides for
certain financial covenants and ratios measured quarterly which
include a current ratio, leverage ratio, and interest coverage
ratio requirements. The Company is out of compliance with all
three ratios as of September 30, 2017, and we do not expect to
regain compliance in 2017. A Forbearance Agreement was
executed in October 2016 as discussed below.
Citibank
is in a first lien position on all our properties. We are current
on all interest payments but Citibank lowered our borrowing base
from $11,000,000 to $5,500,000 on December 1, 2015. During the nine
months ended September 30, 2017, the Company sold non-producing and
non-economic assets in New Mexico, and used $3,115,000 of the
proceeds to pay toward the principal balance of our line of credit
to cure our borrowing base deficiency. Our loan balance is
$3,363,333 as of September 30, 2017.
In
October 2016, we executed a sixth amendment to the original loan
agreement, which provides for Citibank’s forbearance from
exercising remedies relating to the current defaults including the
principal payment deficiencies. The Forbearance Agreement runs
through January 1, 2018, and requires that we make a $500,000 loan
principal pay down by September 30, 2017, and adhere to other
requirements including weekly cash balance reports, quarterly
operating reports, monthly accounts payable reports and that we pay
all associated legal expenses. Furthermore, under the agreement
Citibank may sweep any excess cash balances exceeding a net amount
of $800,000 less equity offering proceeds, which will be applied
towards the outstanding principal balance. The Company paid
$3,115,000 toward the principal balance during the nine months
ended September 30, 2017.
FieldPoint
Petroleum Corporation
NOTES
TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS
To
mitigate our current financial situation, we are taking the
following steps. We are actively meeting with investors for
possible equity investments, including business combinations. We
filed a new shelf registration statement on Form S-3 that was
effective August 15, 2016, to permit the future sale of equity
securities, including a limited at the market (ATM) capital raise.
The shelf registration statement will be effective for a period of
three years from its effective date; provided, however, if the
Company’s common stock is delisted from the NYSE American
(formerly NYSE MKT) due to its non-compliance with continued
listing requirements (see disclosures below), the Company will no
longer be eligible to use Form S-3 and will be required to withdraw
its shelf registration statement. We are investigating other
sources of capital.
On
August 12, 2016, the Company entered into a binding Stock and
Mineral Purchase Agreement (the “SMPA”) with HFT
Enterprises, LLC (the “Buyer”), to provide liquidity to
the Company. The Buyer purchased newly-issued shares of common
stock of the Company equal to 19.9% of the total number of issued
and outstanding shares of the Company, as measured on the date of
the Agreement, for a price of $0.45 per share (the shares to be
purchased, the “Shares”). In November 2016, the Buyer
purchased for gross proceeds of $398,053 paid in consideration of
884,564 shares of unregistered common stock. In December 2016, the
Buyer purchased for gross proceeds of $199,027 paid in
consideration of 442,282 shares of unregistered common stock. The
remaining 442,282 shares of the second tranche were purchased in
January 2017 for gross proceeds of $199,027 paid in consideration
of 442,282 shares of unregistered common stock. Euro Pacific
Capital, Inc. acted as the placement agent and garnered a fee of
5%.
The
SMPA also granted to the Buyer, a related party after the purchase
of the stock discussed above, the right to purchase an undivided
100% working interest on or before December 31, 2016, in the
Company’s Elkhorn and JC Kinney leases in the Big Muddy Oil
Field in Converse County, Wyoming for a purchase price of $430,000.
The SMPA was amended on January 9, 2017, to add the right to the
Buyer to purchase an undivided 100% of working interest in the
mineral lease covering the Quinoco Sulimar Field in Chaves County,
New Mexico, in lieu of the Wyoming property, for a purchase price
to be determined. Additionally, it extended the purchase date of
either property to on or before April 1, 2017. The Board of
Directors voted March 24, 2017, to extend the agreement for the
Quinoco Sulimar Field only to June 30, 2017. The agreement has been
verbally extended to December 31, 2017. As a condition of the
purchase, all proceeds from the sale of the working interest must
be used to pay down the Company’s indebtedness owed to
Citibank. Other conditions include the requirement that Citibank
will have agreed to extend the maturity date on the Company’s
current indebtedness owed until December 31, 2017, which was
accomplished in the Forbearance Agreement discussed above. Also,
the Buyer has been granted the right to nominate one member of the
Board of Directors.
On May
11, 2016, the Company received notification from the NYSE American
(formerly NYSE MKT) that it was noncompliant with the NYSE American
(formerly NYSE MKT) continued listing standards; specifically,
Section 1003(a)(i) of the Company Guide related to financial
impairment. The Company’s stockholders’ equity is below
the $2.0 million threshold required for listed companies that have
reported losses from continuing operations in two of its three most
recently completed fiscal years. The Company submitted a plan to
regain compliance; whereupon NYSE Regulation reviewed the plan and
determined to accept it, as supplemented, and granted a plan period
through November 13, 2017, to regain compliance, the targeted
completion date. NYSE Regulation staff has been reviewing the
Company periodically for compliance with the initiatives outlined
in the plan.
FieldPoint
Petroleum Corporation
NOTES
TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS
Additionally,
on April 28, 2017, the Company received notification from the NYSE
American (formerly NYSE MKT) that it was noncompliant with the NYSE
American (formerly NYSE MKT) continued listing standards;
specifically, Section 1003(a)(ii) of the Company Guide.
The Company’s stockholders’ equity has been below
the $2.0 million threshold required for listed companies that have
reported losses from continuing operations in two of its three most
recently completed fiscal years (Section 1003(a)(i)) and is now
below the $4.0 million threshold required for listed companies that
have reported losses from continuing operations in three of its
four most recent fiscal years (Section 1003(a)(ii)). The Company
was given the opportunity to and submitted a supplement to the Plan
to address how it intends to regain compliance with Section
1003(a)(ii). The Plan period to regain compliance with all of
the continued listing standards by November 13, 2017, remained the
same. The Company has been subject to periodic reviews by the
Exchange. If the Company is not in compliance with the continued
listing standards by November 13, 2017, or if the Company does not
make progress consistent with the Plan, the Exchange will initiate
delisting procedures as appropriate. If our initiatives to regain
compliance are not successful and the Company is delisted from the
NYSE American (formerly NYSE MKT), it could have a significant
adverse impact on our ability to raise additional
capital.
As of
the date of this Report, the November 13, 2017, deadline to regain
compliance has passed without the Company achieving the needed
increase in equity to be eligible for continued listing on the NYSE
American. The Company continues to explore possible transactions
that would infuse sufficient equity to achieve continued listing
eligibility; however, the Company expects the NYSE American to
begin the delisting process given the passing of the deadline.
There can be no assurance that the Company can consummate a
transaction to increase equity in time to avoid
delisting.
Our
warrants listed on the NYSE American (formerly NYSE MKT) as FPP WS
expire March 23, 2018. If the warrants trade at sub-penny before
that date, the NYSE will immediately suspend and move to delist the
warrants.
Our
ability to continue as a “going concern” is dependent
on many factors, including, among other things, our ability to
comply with the covenants in our existing debt agreements, our
ability to cure any defaults that occur under our debt agreements
or to obtain waivers or forbearances with respect to any such
defaults, and our ability to pay, retire, amend, replace or
refinance our indebtedness as defaults occur or as interest and
principal payments come due. Our ability to continue as a going
concern is also dependent on raising additional capital to fund our
operations and ultimately on generating future profitable
operations. While we are actively involved in seeking new sources
of working capital, there can be no assurance that we will be able
to raise sufficient additional capital or to have positive cash
flow from operations to address all of our cash flow needs.
Additional capital could be on terms that are highly dilutive to
our shareholders. If we are not able to find alternative sources of
cash or generate positive cash flow from operations, our business
and shareholders may be materially and adversely
affected.
3.
Recently Issued Accounting
Pronouncements
In May
2014, the FASB issued Accounting Standards Update No. 2014-09,
“Revenue from Contracts with Customers”. Under this new
standard, revenue is recognized at the time goods or services are
transferred to a customer for the amount of consideration the
entity expects to be entitled in exchange for the specific goods or
services. Additional disclosures will be required to describe the
nature, amount, timing, and uncertainty of revenue and cash flows
from contracts with customers. The Company currently follows the
sales method of accounting for oil, NGL and natural gas production,
which is generally consistent with the revenue recognition
provision of the new standard. However, we are currently evaluating
the impact, if any, that this standard will have on our
consolidated financial statements. Our evaluation process includes
(i) review of revenue contracts and transactions and (ii) assessing
the impact this guidance will have on our processes and internal
controls. This evaluation will continue throughout 2017, and we are
currently planning to adopt this new standard January 1,
2018.
In
February 2016, the FASB issued Update No.
2016-02, “Leases”, to increase transparency and
comparability among organizations by recognizing lease assets and
lease liabilities on the balance sheet and disclosing key
information about leasing arrangements. This authoritative guidance
is effective for fiscal years beginning after December 15, 2018 and
interim periods within those fiscal years. The Company is currently
evaluating the provisions of this guidance and assessing its impact
in relation to the Company's leases.
FieldPoint
Petroleum Corporation
NOTES
TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS
In
November 2016, the FASB issued Accounting Standards Update No.
2016-18, “Statement of Cash Flows: Restricted Cash”, to
require amounts generally described as restricted cash and
restricted cash equivalents to be included with cash and cash
equivalents when reconciling the beginning-of-period and
end-of-period total amounts shown on the statement of cash flows.
The guidance is effective for the annual period ending after
December 15, 2017, and interim periods within those fiscal years,
using a retrospective transition method to each period presented.
The Company plans to adopt the new standard December 31, 2017, and
does not expect any impact on our consolidated statement of cash
flows.
4.
Oil and Natural Gas
Properties
No
wells were drilled or completed during the three or nine months
ended June 30, 2017 or 2016.
In the
three months ended September 30, 2017, the Company sold 401 net
acres of non-producing leasehold in Lea County, New Mexico. The
gross proceeds from the sale of our net interest in these
properties was $1,200,000. In the nine months ended September 30,
2017, the Company sold its net interest in the Hermes, Cronos and
Mercury wells. These wells were not economic to our interests. We
also sold our net interest in the unproved Bilbrey acreage that was
held by production. The gross proceeds from the sale of our net
interest in these properties was $2,145,000. For the nine months
ended September 30, 2017, we recognized total gains of
approximately $3,204,000. We continue to evaluate our portfolio for
other properties to divest in order to regain compliance with our
bank’s debt covenants and with the NYSE American (formerly
NYSE MKT).
On a
quarterly basis, the Company compares our most recent engineering
reports to forward strip pricing as of the end of the quarter and
production to determine impairment charges, if needed, in order to
write down the carrying value of certain properties to fair value.
In order to determine the amounts of the impairment charges, the
Company compares net capitalized costs of proved oil and natural
gas properties to estimated undiscounted future net cash flows
using management's expectations of economically recoverable proved
reserves. If the net capitalized cost exceeds the undiscounted
future net cash flows, the Company impairs the net cost basis down
to the discounted future net cash flows, which is management's
estimate of fair value. In order to determine the fair value, the
Company estimates reserves, future operating and development costs,
future commodity prices and a discounted cash flow model utilizing
a 10 percent discount rate. The estimates used by management for
the fair value measurements utilized in this review include
significant unobservable inputs, and therefore, the fair value
measurements are classified as Level 3 of the fair value hierarchy.
Based on its current circumstances, the Company has not recorded
any impairment charges during the three or nine months ended
September 30, 2017.
Basic
earnings per share are computed based on the weighted average
number of shares of common stock outstanding during the period.
Diluted earnings per share take common stock equivalents (such as
options and warrants) into consideration using the treasury stock
method. The Company had 7,177,010 warrants outstanding with an
exercise price of $4.00 at September 30, 2017 and 2016. The
dilutive effect of the warrants for the three months ended
September 30, 2017 and 2016, is presented below.
FieldPoint
Petroleum Corporation
NOTES
TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS
|
For the Three
Months Ended
September
30,
|
For the Nine
Months Ended
September
30,
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
$
901,105
|
$
(630,299
)
|
$
2,239,240
|
$
(2,078,259
)
|
|
|
|
|
|
Weighted average
common stock outstanding
|
10,669,229
|
8,899,992
|
10,652,218
|
8,893,386
|
Weighted average
dilutive effect of stock warrants
|
-
|
-
|
-
|
-
|
Dilutive weighted
average shares
|
10,669,229
|
8,899,992
|
10,652,218
|
8,893,386
|
|
|
|
|
|
Earnings (loss) per
share:
|
|
|
|
|
Basic
|
$
0.08
|
$
(0.07
)
|
$
0.21
|
$
(0.23
)
|
Diluted
|
$
0.08
|
$
(0.07
)
|
$
0.21
|
$
(0.23
)
|
For the
three and nine months ended September 30, 2017 and 2016, the
Company’s deferred tax assets were reduced in full by a
valuation allowance due to our determination that it is more likely
than not that some or all of the deferred tax assets will not be
realized in the future. As a result, the Company has not recognized
an income tax benefit associated with its net loss for the three or
nine months ended September 30, 2016. For the three and nine months
ended September 30, 2017, the Company recognized $822 and $4,606,
respectively, in state income tax expense, which is less than 1%
income tax rate. This rate differs from the statutory federal and
state rate due to net operating losses from prior years. The
Company had no income tax expense for the three or nine months
ended September 30, 2016.
The
Company has a line of credit with a bank with a borrowing base of
$5,500,000 at September 30, 2017, and December 31, 2016. The amount
outstanding under this line of credit was $6,478,333 which is
$978,333 over the borrowing base at December 31, 2016. During the
nine months ended September 30, 2017, the company sold three of its
undeveloped, non-producing and non-economic assets in New Mexico,
and used $3,115,000 of the proceeds to pay toward the principal
balance of our line of credit to cure our borrowing base
deficiency. Our loan balance is $3,363,333 as of September 30,
2017. Although our borrowing base is $5,500,000, we cannot draw
additional amounts on the line of credit while we remain in
technical default on the loan. We plan to continue evaluating our
portfolio for non-producing assets which can be liquidated to
reduce debt further.
The
sixth amendment to the original loan agreement requires quarterly
interest-only payments until maturity on January 1, 2018. The
interest rate is based on a LIBOR or Prime option. The Prime option
provides for the interest rate to be prime plus a margin ranging
between 1.75% and 2.25% and the LIBOR option to be the 3-month
LIBOR rate plus a margin ranging between 2.75% and 3.25%, both
depending on the borrowing base usage. Currently, we have elected
the LIBOR interest rate option in which our interest rate was
approximately 4% as of September 30, 2017, and December 31, 2016,
respectively. The commitment fee is .50% of the unused borrowing
base. Citibank is in a first lien position on all our properties
and assets.
FieldPoint
Petroleum Corporation
NOTES
TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS
The
line of credit provides for certain financial covenants and ratios
which include a current ratio that cannot be less than 1.10:1.00, a
leverage ratio that cannot be more than 3.50:1.00, and an interest
coverage ratio that cannot be less than 3.50:1.00. The Company is
out of compliance with all three ratios as of September 30, 2017,
and December 31, 2016, and is in technical default of the
agreement.
In
October 2016, we executed a sixth amendment to the original loan
agreement, which provides for Citibank’s forbearance from
exercising remedies relating to the current defaults including the
principal payment deficiencies. The Forbearance Agreement runs
through January 1, 2018, and requires that we make a $500,000 loan
principal pay down by September 30, 2017, and adhere to other
requirements including weekly cash balance reports, quarterly
operating reports, monthly accounts payable reports and that we pay
all associated legal expenses. Furthermore, under the agreement
Citibank may sweep any excess cash balances exceeding a net amount
of $800,000 less equity offering proceeds, which will be applied
towards the outstanding principal balance. The Company paid
$3,115,000 toward the principal balance in the nine months ended
September 30, 2017.
There
were 7,177,010 warrants with an exercise price of $4.00 outstanding
at September 30, 2017. There have been no warrants issued or
exercised during the three and nine months ended September 30,
2017. The weighted average expected life of the warrants was less
than one year at September 30, 2017.
As a
signing bonus to his “at will” employment agreement,
Phillip Roberson, as President and CFO, received a total of 50,000
shares of common stock that vested over a three year period
beginning on July 1, 2014. On January 1, 2016, 10,000 shares were
vested and issued. The final 10,000 shares vested at the last
six-month anniversary date on July 1, 2016. The fair value of this
stock grant was $275,000 on July 1, 2014, of which $13,750 was
recognized as non-cash stock compensation expense during the nine
months ended September 30, 2016. Mr. Roberson was awarded, as part
of his annual compensation, on his third anniversary date 5,000
shares, and will receive on his fourth anniversary date 6,000
shares, on his fifth anniversary date 7,000 shares, on his sixth
anniversary date 8,000 shares, on his seventh anniversary date
9,000 shares, and each annual anniversary date thereafter 10,000
shares. However, Mr. Roberson declined the 5,000 shares that would
have been awarded on this third anniversary date on July 1, 2017.
Mr. Roberson’s contract was extended by the Compensation
Committee to July 1, 2018.
On
August 12, 2016, the Company entered into a binding Stock and
Mineral Purchase Agreement (the “SMPA”) with HFT
Enterprises, LLC (the “Buyer”) in order to provide
liquidity to the Company. The Buyer purchased newly-issued
restricted shares of common stock of the Company equal to 19.9% of
the total number of issued and outstanding shares of the Company,
as measured on the date of the Agreement, for a price of $0.45 per
share. In 2016, the Buyer purchased for gross proceeds of $597,080
paid in consideration of 1,326,846 shares of unregistered common
stock. The remaining shares were purchased in January 2017, for
gross proceeds of $199,027 paid in consideration of 442,282 shares
of unregistered common stock. Costs incurred by the Company to
issue the stock was $11,807 for the nine months ended September 30,
2017.
FieldPoint
Petroleum Corporation
NOTES
TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS
The
SMPA also granted to the Buyer, a related party after the purchase
of the stock discussed above, the right to purchase an undivided
100% working interest on or before December 31, 2016, in the
Company’s Elkhorn and JC Kinney leases in the Big Muddy Oil
Field in Converse County, Wyoming for a purchase price of $430,000.
The SMPA was amended on January 9, 2017, to add the right to the
Buyer to purchase an undivided 100% of working interest in the
mineral lease covering the Quinoco Sulimar Field in Chaves County,
New Mexico, in lieu of the Wyoming property, for a purchase price
to be determined. Additionally, it extended the purchase date of
either property to on or before April 1, 2017. The Board of
Directors voted March 24, 2017, to extend the agreement for the
Quinoco Sulimar Field only to June 30, 2017. The agreement has been
verbally extended to December 31, 2017. As a condition of the
purchase, all proceeds from the sale of the working interest must
be used to pay down the Company’s indebtedness owed to
Citibank. Other conditions include the requirement that Citibank
will have agreed to extend the maturity date on the Company’s
current indebtedness owed until December 31, 2017, which was
accomplished in the Forbearance Agreement discussed above. Also,
the Buyer has been granted the right to nominate one member of the
Board of Directors.
On
October 2, 2017, the Company sold its 25.23% working interest in a
waterflood project consisting of 23 producing and 9 injection wells
in the Apache field in Caddo County, Oklahoma for $900,000. The
Company anticipates it will recognize a gain on the sale of
approximately $642,000. The Company used $600,000 of the proceeds
to reduce our credit line with Citibank to $2,763,333.
On
November 1, 2017, the Company sold its working interest in the Rush
Springs Field in Oklahoma for $13,000. The Company will pay a
placement fee of 10%.
As of the date of this Report, the November 13, 2017, deadline to
regain compliance with the NYSE American continued listing
requirements has passed without the Company achieving the needed
increase in equity to be eligible for continued listing on the NYSE
American. The Company continues to explore possible transactions
that would infuse sufficient equity to achieve continued listing
eligibility; however, the Company expects the NYSE American to
begin the delisting process given the passing of the deadline.
There can be no assurance that the Company can consummate a
transaction to increase equity in time to avoid
delisting.
PART I