# Ideal Power Inc.: Form 10-Q for the period ended Jun 30, 2015

- Company: [Ideal Power Inc.](/companies/ipwr.md) (CIK 1507957)
- Form: 10-Q
- Filed: 2015-08-13
- Accepted by EDGAR: Aug 13, 2015, 08:00 ET
- Period: 2015-06-30
- Accession: 0001144204-15-048720
- Inline XBRL: yes
- Main document: https://www.sec.gov/Archives/edgar/data/1507957/000114420415048720/v417351_10q.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/1507957/000114420415048720/

## Figures reported in this filing

Standardized XBRL line items for the period ended 2015-06-30.

| Line item | Period | Value | XBRL concept |
| --- | --- | ---: | --- |
| Revenue | 3 months, 2015-04-01 to 2015-06-30 | $1.2m | us-gaap:Revenues |
| Revenue | 6 months, 2015-01-01 to 2015-06-30 | $2.4m | us-gaap:Revenues |
| Cost of revenue | 3 months, 2015-04-01 to 2015-06-30 | $1.1m | us-gaap:CostOfRevenue |
| Cost of revenue | 6 months, 2015-01-01 to 2015-06-30 | $2.1m | us-gaap:CostOfRevenue |
| Gross profit | 3 months, 2015-04-01 to 2015-06-30 | $142.9k | us-gaap:GrossProfit |
| Gross profit | 6 months, 2015-01-01 to 2015-06-30 | $321.4k | us-gaap:GrossProfit |
| Research and development | 3 months, 2015-04-01 to 2015-06-30 | $1.1m | us-gaap:ResearchAndDevelopmentExpense |
| Research and development | 6 months, 2015-01-01 to 2015-06-30 | $2.1m | us-gaap:ResearchAndDevelopmentExpense |
| Operating income | 3 months, 2015-04-01 to 2015-06-30 | −$2.3m | us-gaap:OperatingIncomeLoss |
| Operating income | 6 months, 2015-01-01 to 2015-06-30 | −$4.5m | us-gaap:OperatingIncomeLoss |
| Net income | 3 months, 2015-04-01 to 2015-06-30 | −$2.3m | us-gaap:NetIncomeLoss |
| Net income | 6 months, 2015-01-01 to 2015-06-30 | −$4.5m | us-gaap:NetIncomeLoss |
| Diluted EPS | 3 months, 2015-04-01 to 2015-06-30 | −$0.28 | us-gaap:EarningsPerShareBasicAndDiluted |
| Diluted EPS | 6 months, 2015-01-01 to 2015-06-30 | −$0.59 | us-gaap:EarningsPerShareBasicAndDiluted |
| Operating cash flow | 6 months, 2015-01-01 to 2015-06-30 | −$3.5m | us-gaap:NetCashProvidedByUsedInOperatingActivitiesContinuingOperations |
| Capital expenditure | 6 months, 2015-01-01 to 2015-06-30 | $343.2k | us-gaap:PaymentsToAcquirePropertyPlantAndEquipment |
| Cash and equivalents | at 2015-06-30 | $20.0m | us-gaap:CashAndCashEquivalentsAtCarryingValue |
| Current assets | at 2015-06-30 | $21.7m | us-gaap:AssetsCurrent |
| Total assets | at 2015-06-30 | $23.4m | us-gaap:Assets |
| Current liabilities | at 2015-06-30 | $2.0m | us-gaap:LiabilitiesCurrent |
| Shareholders' equity | at 2015-06-30 | $21.4m | us-gaap:StockholdersEquity |

## Management's discussion and analysis

As filed, 28,118 characters.

*The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q as well as our audited 2014 financial statements and related notes included in our Annual Report on Form 10-K. In addition to historical information, the discussion and analysis here and throughout this Form 10-Q contains forward-looking statements that involve risks, uncertainties and assumptions. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of certain factors, including, but not limited, to those set forth under “Risk Factors” in Part II, Item 1A of this report.*

### OVERVIEW

Ideal Power is located in Austin, Texas. We design, market and sell electrical power conversion products using our proprietary technology called Power Packet Switching Architecture, or PPSA. Our PPSA technology enables high efficiency power conversion by eliminating many of the heavy, passive components used in conventional power conversion products and replacing them with a unique software-enabled topology. Our products are designed to be used in both on-grid and off-grid applications. We believe our products are the only transformer-less power converters with electrical isolation approved for use in on-grid applications. Our technology is protected by a patent portfolio of 26 US and four foreign issued patents. We own all of the rights to our PPSA technology.

We sell our products primarily to systems integrators for installation as part of a larger turn-key system providing the end user with a complete solution for managing their energy consumption. These customers sell systems that enable end users to manage their electricity consumption by reducing demand charges and integrating renewable energy sources. We also sell systems to commercial end users that enable them to reduce fossil fuel consumption and/or form their own microgrid. Our products are made by contract manufacturers to our specifications, enabling us to scale production to meet demand on a cost-effective basis without requiring significant expenditures on manufacturing facilities and equipment. Our existing products that connect to the power grid are UL 1741 certified, and we are in the process of getting new products UL 1741 certified.

The Company was founded on May 17, 2007. To date, operations have been funded primarily through the sale of common stock, US Department of Energy grants and, prior to its initial public offering, issuance of convertible debt. Total revenue generated from inception to date as of June 30, 2015 amounted to $8,474,224 with approximately a third of that revenue coming from government grants. The Company has applied these revenues to research and product development, thereby reducing its capital requirements. The Company may continue to pursue research and development grants, if and when available, for the purpose of developing new products and improving current products.

### Our PPSA Technology

Our PPSA-based products provide the same electrical isolation as traditional, transformer-based power conversion systems. We believe our products are the only commercial transformer-less power conversion systems that provide the electrical isolation required to connect alternative energy sources and battery storage systems to the grid. Because our products use software-enabled technologies to replace the traditional transformer and other bulky, passive components used in traditional power conversion systems, our power conversion systems (“PCS”) are lighter, smaller and more efficient.

Our PPSA technology uses indirect power flow in which power flows through input switches and is temporarily stored in our proprietary AC link inductor. Our proprietary fast switching algorithms enable the transfer of quantum packets of power between ports in our system. As the AC link becomes charged, it disconnects from its input switches, resonates without being connected to either the input or output switches, and then reconnects to its output switches when it reaches the correct voltage and frequency for the application, providing true electrical isolation without the need for a transformer.

### Existing Products

We have six products based on our PPSA technology. Each of these products is briefly described below:

- 30kW photovoltaic, or PV, Inverter, which has a UL 1741 certification and is intended to be used for commercial and industrial solar power installations. This is our first product and shares the same hardware as the Company’s 30kW battery converter described below but uses embedded software specific to a PV application.
- 30kW Battery Converter, which has a UL 1741 certification and is intended to be used for the commercial and industrial grid-tied distributed energy storage market. This battery converter is bi-directional, which means power can flow to or from batteries. This product uses the same hardware design as the 30kW PV Inverter, but has embedded software that enables bi-directional power conversion and control. This product is more efficient and approximately only 1/4th to 1/8th the size and weight of similar transformer-based products. The 30kW Battery Converter also has a significantly lower acoustic noise profile and can be installed in buildings without the need for acoustic isolation or insulation.
- 30kW grid-resilient AC-DC PCS, for which we received UL 1741 certification for grid-tied applications in June 2015. This product is able to convert to both 50Hz and 60Hz AC current and has the ability to form and manage a microgrid. This product is intended for customers who need a 30kW battery converter for use overseas or who need the additional capability to form a microgrid. This product is not a replacement for our 30kW battery converter but complements the existing product with additional features.
- 30kW grid-resilient AC-DC-DC multi-port PCS with two DC ports enabling two DC inputs, such as a PV and a battery storage system, to be installed with one power converter. We received UL 1741 certification for grid-tied applications of this product in the June 2015. This product is capable of managing the conversion to both 50Hz and 60Hz AC current, enabling the ability to operate in grids outside of North America. This product also has the ability to form and manage a microgrid, effectively using energy storage with distributed generation resources to support critical loads or allow a building to disconnect from the utility power grid. This product received the “Electrical Energy Storage Award” for product innovation in 2014 at InterSolar, Germany, the world’s largest solar exhibition.
- 125kW grid-resilient AC-DC PCS, for higher power applications. This 125kW system has over four times the power of the 30kW product and is also able to convert to both 50Hz and 60Hz AC current. This product is primarily for use in grid-tied applications, and we expect to receive its UL 1741 certification in the second half of 2015. It also has the ability to form and manage a microgrid.
- 125kW grid-resilient AC-DC-DC multi-port PCS for higher power applications with multi-port capabilities. This 125kW system has over four times the power of the 30kW multi-port product and is also able to convert to both 50Hz and 60Hz AC current. This product has the ability to form and manage a microgrid. Because this product is intended primarily for off-grid and microgrid management applications, we do not intend to seek a UL 1741 certification for this product at this time. This product is currently in prototype production only with the first customer shipment in June 2015.

The figure below illustrates this product family:

### Strategy

Our strategy is to promote and expand the use of our PPSA technology through product development and product sales, including the licensing of our product designs to systems integrators and other original equipment manufacturers, or OEMs. We intend to target OEMs in the power conversion industry that serve markets and geographies that would be difficult or costly for us to pursue directly and which make complementary products that do not compete with us in our core markets or core product offerings.

### Future Innovations

#### BD-IGBT

Our existing products incorporate multiple IGBTs, which are power switches used in the process to convert power from one current form to another. IGBTs switch power in only one direction (DC to AC or AC to DC) and require the use of a diode to prevent power from flowing back into the system. To enable our existing products to perform bi-directional power conversion, for each IGBT and diode used in our products, we must include a second IGBT and diode. These components result in a slight voltage drop that affects the electrical efficiency of our products and generate excess heat that must be dissipated. We are developing a bi-directional IGBT, or BD-IGBT, that we believe will allow us to substitute one BD-IGBT for two pairs of IGBTs and diodes used in our current products. Based on our software simulations, we believe that the BD-IGBTs can improve electrical efficiency from approximately 96.5% to greater than 98%, which would reduce the heat generated by the operation of our products. As a result, products incorporating BD-IGBTs will require less space for heat dissipation which would allow us to reduce our material costs. We believe that these development efforts, if successful, will enhance the competitive position of our products.

#### B-TRAN

During the course of our BD-IGBT development, we have come up with an alternative bi-directional switch concept to the BD-IGBT which we are calling the B-TRAN. This new bi-directional switch concept has the potential to meet or exceed the projected performance of the B-TRAN as validated by third party simulations. While our primary technology path for bi-directional switching remains the BD-IGBT, the B-TRAN device provides us an option with potentially higher performance. During the second quarter, the U.S. Patent Office awarded us five new patents covering the operation, control and manufacturing of the B-TRAN device. We intent to engage an additional semiconductor fabricator to produce a proof of concept of the B-TRAN device which will result in a significant increase in our research & development spending for the balance of 2015 and first quarter of 2016.

We expect that our intellectual property rights will continue to be a significant asset to us and our strategy is to actively pursue patent protection for our innovative technologies in the US and other commercially important global markets. We have 26 US and four foreign issued patents. We have filed numerous additional pending US, foreign and international patent applications.

### Target Markets

We have focused our sales and marketing efforts on markets where we believe our technology has the most value. We focus on sales to commercial and industrial customers in which there is a need for power conversion systems to:

- manage consumption to reduce peak power demands;
- integrate new sources of generation such as distributed PV; and
- form microgrids.

We believe our products provide compelling advantages to commercial or industrial customers who have these needs due to the reduced weight, compact size, quiet operation, high efficiency and reliability, and advanced programmability of our products compared to traditional power conversion systems.

According to Yole Development, or Yole, a global research firm specializing in the scientific and power electronics markets, the global power conversion market was approximately $50 billion in 2014 and is forecast to grow to over $70 billion by 2020.

#### Battery and Microgrid Power Conversion Market

Battery Energy Storage Systems, or BESS, are blocks of batteries coupled with a power conversion system to enable electric power to be captured and stored for future use. These grid-tied systems can be large, megawatt-scale systems operated by utilities to better manage their system resources, or small, kilowatt-scale systems in homes and businesses designed to enable consumers to manage their power use and mitigate utility imposed demand charges. In certain US markets, such as California, New York, and Massachusetts, there are economic incentives available to commercial and industrial consumers in the form of reduced demand charges for installing a BESS and reducing peak consumption. There is also emerging regulatory policy that is driving the adoption of energy storage. For example, California has issued a mandate for over 1,000 megawatts of new energy storage to be installed by 2020, and currently offers attractive rebates to end users who install a BESS through its Self-Generation Incentive Program.

Typically, PV systems are connected to the utility power grid so customers can continue to receive power from the utility to augment their PV systems and, in some cases, to sell power back to the utility. As a as result, when the utility power grid becomes unavailable or experiences a blackout, the PV system is prevented by design from generating power to avoid damaging grid equipment or creating a safety hazard. Our grid-resilient multi-port power conversion systems are designed to address this problem by enabling a solar PV system with a BESS to operate and be managed as a local microgrid even when the utility grid is down. In addition, our grid-resilient multi-port power conversion systems work with other energy sources, such as a diesel generator coupled with a BESS.

We sell a number of our products to BESS integrators, such as Gexpro Energy Solutions, Sharp Electronics, CODA Energy, Green Charge Networks and EOS Energy Storage.

Commercial and industrial BESS are used for more than peak demand reduction. IHS, a global research firm, forecasts that global installations of grid-tied commercial BESS coupled with PV, a subset of the battery and microgrid market, will grow 111% annually to over 600 MW of BESS by 2018.

#### Other Microgrid Applications

We believe, based on our analysis of market characteristics including existing grid infrastructure, high diesel fuel costs, good solar irradiance, and projected population growth, regions such as Southeast Asia, Africa, the Middle East, and Central and South America will have increasing demand for new power generation capacity. Remote communities with limited infrastructure in these regions depend more on expensive diesel fuel to generate electricity and may not have a utility power grid for access to high quality, reliable power. As a result, we believe that these less developed countries represent a significant opportunity for our grid-resilient products. IHS has predicted that the market for off-grid and microgrid BESS installations with PV will reach 400MW by 2018 with the majority of this growth coming from regions with less developed electricity infrastructure.

### Other Markets

In addition to the markets discussed above, we believe there are other potential market opportunities for our power conversion systems. As an example, we have provided power conversion systems to NRG Energy, Inc. for a California Public Utility Commission-approved technology demonstration program to reduce the installation and operational costs of DC charging infrastructure for electric vehicles and, in September 2014, NRG purchased two of our 30kW battery converters for installation at a demonstration site at the University of California San Diego. Additionally, we shipped our first order for the commercial wind turbine market in September 2014. We believe our PPSA technology can also be used in other verticals within the global power conversion market.

### Critical Accounting Policies

There have been no significant changes during the three and six months ended June 30, 2015 to the critical accounting policies disclosed in Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended December 31, 2014.

### Results of Operations

### Comparison of the three months ended June 30, 2015 to the three months ended June 30, 2014

*Revenues.* Revenues for the three months ended June 30, 2015 of $1,199,037 were $638,511, or 114%, higher than the $560,526 we earned in revenues for the three months ended June 30, 2014. The increase was due to a $754,937 increase in product revenues, primarily associated with sales of our 30kW Battery Converter but also including sales of our grid-resilient 30kW PCS and 125kW products.

There were no grant revenues for the three months ended June 30, 2015, as compared to grant revenues for the three months ended June 30, 2014 of $116,426. At December 31, 2014, we had recognized all grant revenues related to the ARPA-E grant.

*Cost of Revenues.* Cost of revenues increased for the three months ended June 30, 2015 to $1,056,138 compared to $570,334 for the three months ended June 30, 2014 due to $615,166 increase in product cost of revenue partially offset by a $129,362 decrease in grant research and development costs. The increase was primarily due to higher unit sales volumes compared to the three months ended June 30, 2014, as well as costs associated with the production of new products in low volume and higher personnel costs. The decrease in grant research and development costs is due to the ARPA-E grant being fully funded at December 31, 2014.

*Gross Profit (Loss).* Gross profit for the three months ended June 30, 2015 was $142,899 compared to a gross loss for the three months ended June 30, 2014 of $9,808. Our gross profit improvement was due to the impact of $754,937 of higher product sales compared to the three months June 30, 2014 and was partly offset by costs associated with the production of new products in low volume and increased personnel costs.

*Research and Development Expenses.* Research and development expenses increased by $455,013, or 71%, to $1,100,348 in the three months ended June 30, 2015 from $645,335 in the three months ended June 30, 2014. The increase was due to incremental costs associated with advanced power switch development of $195,212, higher personnel costs of $176,033, higher development costs for new products, including our grid-resilient 30kW 2 port and multi-port PCS and 125kW 2 port and multi-port PCS, of $87,696, higher product certification costs of $34,833, and higher stock-based compensation of $32,239, partly offset by lower contract labor of $106,183. The costs related to advanced power switch development increased as we are self-funding these efforts going forward after fully utilizing the ARPA-E grant program funding in December 2014.

*General and Administrative Expenses.* General and administrative expenses increased by $250,077, or 35%, to $968,364 in the three months ended June 30, 2015 from $718,287 in the three months ended June 30, 2014. The increase was due primarily to higher stock-based compensation of $101,607, higher personnel costs of $60,171 and higher legal and patent fees of $55,214 compared to the three months ended June 30, 2014. In addition, we also wrote off $45,641 of capitalized software costs in the three months ended June 30, 2015.

*Sales and Marketing Expenses.* Sales and marketing expenses increased by $109,700, or 42%, to $371,228 in the three months ended June 30, 2015 from $261,528 in the three months ended June 30, 2014. The increase was due primarily to bad debt expense of $54,333 and higher contract labor costs of $30,739.

*Loss from Operations.* Due to the increase in our operating expense, which was partially offset by our gross profit, our loss from operations for the three months ended June 30, 2015 was $2,297,041 or 40% higher than the $1,634,958 loss from operations for the three months ended June 30, 2014.

*Interest Income.* Interest income decreased to $4,651 for the three months ended June 30, 2015 compared to $7,394 for the three months ended June 30, 2014.

*Net Loss.* As a result of a higher loss from operations, our net loss for the three months ended June 30, 2015, was $2,292,390 as compared to a net loss of $1,627,564 for the three months ended June 30, 2014.

### Comparison of the six months ended June 30, 2015 to the six months ended June 30, 2014

*Revenues.* Revenues for the six months ended June 30, 2015 of $2,397,028 were $1,545,407, or 181%, higher than the $851,621 we earned in revenues for the six months ended June 30, 2014. The increase in revenue was driven by a $1,844,428 increase in product revenues, primarily associated with sales of our 30kW Battery Converter.

There were no grant revenues for the six months ended June 30, 2015, as compared to grant revenues for the six months ended June 30, 2014 of $299,021. At December 31, 2014, we had recognized all grant revenues related to the ARPA-E grant.

*Cost of Revenues.* Cost of revenues increased for the six months ended June 30, 2015, to $2,075,639 compared to $967,558 for the six months ended June 30, 2014 due to $1,440,326 increase in product cost of revenue partially offset by a $332,245 decrease in grant research and development costs. The increase was primarily due to higher unit sales volumes compared to the six months ended June 30, 2014, as well as higher personnel costs of $117,062. The decrease in grant research and development costs is due to the ARPA-E grant being fully funded at December 31, 2014.

*Gross Profit (Loss).* Gross profit for the six months ended June 30, 2015 was $321,389 compared to a gross loss for the six months ended June 30, 2014 of $115,937. Our gross profit was due to the impact of $1,844,428 of higher product sales compared to the six months June 30, 2014. Gross profit was negatively impacted by increased supply chain and engineering personnel costs, as we added resources to support our existing products, and incremental costs associated with the initial roll-out of new products at low volume.

*Research and Development Expenses.* Research and development expenses increased by $1,137,682, or 119%, to $2,092,580 in the six months ended June 30, 2015 from $954,898 in the six months ended June 30, 2014. The increase was due to incremental costs associated with advanced power switch development of $378,765, higher personnel costs of $375,705, higher development costs for new products, including our grid-resilient 30kW 2 port and multi-port PCS and 125kW 2 port and multi-port PCS, of $254,910, higher product certification costs of $84,327, and higher stock-based compensation of $73,934, partly offset by lower contract labor of $89,741. The costs related to advanced power switch development increased as we are self-funding these efforts going forward after fully utilizing the ARPA-E grant program funding in December 2014.

*General and Administrative Expenses.* General and administrative expenses increased by $415,886, or 28%, to $1,879,141 in the six months ended June 30, 2015 from $1,463,255 in the six months ended June 30, 2014. The increase was due primarily to higher stock-based compensation of $197,304, higher legal and patent fees of $113,308, and higher personnel costs of $112,955 compared to the six months ended June 30, 2014. In addition, we wrote off $45,641 of capitalized software costs in the six months ended June 30, 2015.

*Sales and Marketing Expenses.* Sales and marketing expenses increased by $314,433, or 59%, to $844,180 in the six months ended June 30, 2015 from $529,747 in the six months ended June 30, 2014. The increase was due primarily to severance costs of $139,955, higher contract labor costs of $67,399, bad debt expense of $54,791 and personnel costs of $27,404 compared to the six months ended June 30, 2014.

*Loss from Operations.* Due to the increase in our operating expense which is partially offset by our gross profit, our loss from operations for the six months ended June 30, 2015 was $4,494,512 or 47% higher than the $3,063,837 loss from operations for the six months ended June 30, 2014.

*Interest Income.* Interest income decreased to $9,124 for the six months ended June 30, 2015 compared to $15,531 for the six months ended June 30, 2014.

*Net Loss.* As a result of a higher loss from operations, our net loss for the six months ended June 30, 2015, was $4,485,388 as compared to a net loss of $3,048,306 for the six months ended June 30, 2014.

### Liquidity and Capital Resources

Although our revenues have increased every full calendar year from the date of our inception, we do not generate enough revenue to sustain our operations. Currently, our revenues are derived from the sales of our products. We have primarily funded our operations through the sale of common stock, government grants and, prior to our initial public offering, issuance of convertible debt.

At June 30, 2015, we had cash and cash equivalents of $19,965,791. Our net working capital and long-term debt at June 30, 2015 were $19,639,260 and $0, respectively.

Operating activities in the six months ended June 30, 2015 resulted in cash outflows of $3,480,931, which were due primarily to the net loss for the period of $4,485,388, partly offset by non-cash items of $995,605, related primarily to stock-based compensation of $666,434, write-off of capitalized software and patent costs of $148,930 and depreciation and amortization of $80,940, and positive working capital changes of $8,852. Operating activities in the six months ended June 30, 2014 resulted in cash outflows of $2,503,987, which were due to the net loss for the period of $3,048,306 partially offset by non-cash items of $466,913, related primarily to stock-based compensation of $379,282, and positive working capital changes of $77,406.

Investing activities in the six months ended June 30, 2015 and 2014 resulted in cash outflows of $538,586 and $488,780, respectively, for development of patents and acquisition of fixed assets.

Financing activities in the six months ended June 30, 2015 resulted in cash inflows of $16,073,297, related primarily to the issuance of 2,225,825 shares of common stock shares at a public offering price of $7.75. Net cash proceeds after offering-related expenses were $15,924,405. In addition, we received $148,892 in net proceeds from the exercise of stock options. Financing activities in six months ended June 30, 2014 resulted in cash inflow of $4,990.

### Off-Balance Sheet Transactions

We do not have any off-balance sheet transactions.

### Trends, Events and Uncertainties

Research and development of new technologies is, by its nature, unpredictable. Although we will undertake development efforts with commercially reasonable diligence, there can be no assurance that the net proceeds from the recent public offerings of our common stock will be sufficient to enable us to develop our technology to the extent needed to create future sales to sustain operations as contemplated herein. If the net proceeds from the recent public offerings of our common stock are insufficient for this purpose, we will consider other options to continue our path to commercialization, including, but not limited to, additional financing through follow-on stock offerings, debt financing, co-development agreements, curtailment of operations, suspension of operations, sale or licensing of developed intellectual or other property, or other alternatives.

We cannot assure you that our technology will be adopted, that we will ever earn revenues sufficient to support our operations, or that we will ever be profitable. Furthermore, since we have no committed source of financing, we cannot assure you that we will be able to raise money as and when we need it to continue our operations. If we cannot raise funds as and when we need them, we may be required to severely curtail, or even to cease, our operations.

Other than as discussed above and elsewhere in this report, we are not aware of any trends, events or uncertainties that are likely to have a material effect on our financial condition.

## Controls and procedures

As filed, 1,041 characters.

Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Securities Exchange Act of 1934, as amended is accumulated and communicated to the issuer’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Our management, with the participation of our Chief Executive Officer (principal executive officer) and our Chief Financial Officer (principal financial and accounting officer), has concluded that, as of June 30, 2015, our disclosure controls and procedures are effective.

There have been no other material changes in our internal controls over financial reporting that occurred during the quarter ended June 30, 2015 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

Filed Aug 13, 2015.
Source: SEC EDGAR, the filing index for accession 0001144204-15-048720. Last ingested by Listed: Nov 5, 2026, 19:31 ET. No prices; not investment advice.