NEOM = MASSIVE MASSIVE DEFICIT
Evidence : "Going Concern – We have historically incurred operating losses, and we may continue to generate negative cash flows as we implement our business plan. There can be no assurance that our continuing efforts to execute our business plan will be successful and that we will be able to continue as a going concern. Our net loss for the nine months ended September 30, 2015 was $2,259,000 as compared to net income of $2,500,000 for the same period in 2014. The operating results for the nine months ended September 30, 2015 and 2014, respectively, included $3,103,000 and $1,651,000 of net expense related to financing instruments, and a gain on the settlement of debt of $4,247,000 in 2014.
Net cash used by operations during the nine months ended September 30, 2015 and 2014, respectively, was $41,000 and $333,000. As of September 30, 2015, we have an accumulated deficit of $241.6 million, and a working capital deficit of $41.2 million, including $40.4 million in current liabilities for our derivative and debenture financing instruments.
We currently do not have sufficient cash or commitments for financing to sustain our operations for the next twelve months if we are unable to generate sufficient cash flows from operations. Our plan is to develop new client and customer relationships and substantially increase our revenue derived from our products/services and IP licensing. If our revenues do not reach the level anticipated in our plan, we will require additional financing in order to execute our operating plan. If additional financing is required, we cannot predict whether this additional financing will be in the form of equity, debt, or another form, and we may not be able to obtain the necessary additional capital on a timely basis, on acceptable terms, or at all. In the event that financing sources are not available, or that we are unsuccessful in increasing our revenues and profits, we may be unable to implement our current plans for expansion, repay our debt obligations or respond to competitive pressures, any of which would have a material adverse effect on our business, prospects, financial condition and results of operations and our ability to continue as a going concern.
The maturity date of our convertible debentures was extended from August 1, 2015, to February 5, 2016. The convertible debentures and preferred stock used to finance the Company, which may be converted into common stock at the sole option of the holders, have a highly dilutive impact when they are converted, greatly increasing the number of shares of common stock outstanding. During the first nine months of 2015, there were 768 million shares of common stock issued for these conversions. We cannot predict if or when each holder may or may not elect to convert into shares of common stock.
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