NOTE 9 - SUBSEQUENT EVENTS

On September 3, 2015, the Company issued secured convertible promissory notes (the “Secured Convertible Notes”) in the principal amount of $25 to each of two principal stockholders, for an aggregate of $50, each an existing secured lender to the Company. The Secured Convertible Notes have a maturity date of August 31, 2016 and bear interest at the rate of 5.0% per annum, payable at maturity. The outstanding principal and accrued interest of each Secured Convertible Note is convertible, subject to a 4.99% Beneficial Ownership Cap (as defined in the Secured Convertible Notes), into shares of the Company’s common stock at an initial conversion price of $5.00 per share (subject to adjustment), at the option of the respective holders.

The obligations of the Company under the Secured Convertible Notes are secured by a first priority security interest in all of the property of the Company pursuant to letter agreements, dated September 3, 2015, with each of Iroquois and Hudson, respectively. The proceeds of the Secured Convertible Notes will be utilized by the Company to fund its working capital needs.

On September 3, 2015, the Company also entered into note modification agreements, made as of July 31, 2015, with each of two principal stockholders pursuant to which the maturity dates of the Prior Notes were extended to August 31, 2016 and the Prior Notes were amended to permit conversion of the principal and accrued interest due and payable under the Prior Notes into shares of the Company’s common stock in accordance with the same terms and provisions of the Secured Convertible Notes.

The Company has evaluated the period after the balance sheet date up through the date that the consolidated financial statements were issued, and determined that other than noted above, there were no subsequent events or transactions that required recognition or disclosure in the consolidated financial statements.