Note 16 - Subsequent Events

3 Months Ended

Mar. 31, 2014

Subsequent Events [Abstract]

Subsequent Events [Text Block]

Note 16— Subsequent Events

(a) In April 2014, the Company entered into a three-year, $5,000 revolving line of credit with one of its existing stockholders, who is related to a member of the Company’s board of directors. Borrowings under this line of credit incur interest at a rate of 12% per annum, payable quarterly. Any amounts borrowed under the line of credit become due upon maturity, April 7, 2017. This facility is unsecured and subordinated to the Company’s senior secured term loan. Additionally, either party has the right to terminate this line upon completion of a capital raise in excess of $5,000.

(b) In April and May 2014, subsequent to the balance sheet date, certain investors elected to exercise their shares of Preferred C Stock. As a result, 632,000 shares of common stock were issued by the Company.

(c) In connection with the March 2014 PIPE, we filed a Registration Statement on Form S-1 (Registration No. 333-195251) to register the resale of the shares of common stock underlying the Preferred C Stock, the shares of common stock underlying the March 2014 Warrants and certain shares of common stock that may be issuable as payment for dividends on the Preferred C Stock, which registration statement was declared effective by the SEC on April 25, 2014. Subsequently, and in accordance with the terms of the Preferred C Stock, such registration triggered a reduction of the conversion price of the Preferred C Stock from $3.40 to $2.71 and the exercise price of the warrants was reduced from $4.75 to $3.39 and from $5.10 to $4.07, as applicable. Consequently, as of May 2, 2014, an additional 775,395 shares of common stock may be issuable upon the conversion of the Preferred C Stock and an additional 62,029 shares may be issuable as payment for dividends thereon. We believe the accounting impact of the adjustment to be material. We plan to file with the SEC a new Registration Statement on Form S-1 to register the resale of the additional shares underlying the Preferred C Stock and the March 2014 Warrants. The Company is currently unable to evaluate the overall impact of this event on its overall financial statements.

(d) In May 2014, subsequent to the balance sheet date, the Company initiated negotiations towards an amendment to the Preferred C Stock agreements. In accordance with such proposed amendment, the holders of the Preferred C Stock are to receive voting rights, on an as if converted basis, subject to the limitations on beneficial ownership. In addition, a floor is to be set at $0.25 to the conversion price of the Preferred C Stock. As a result of such suggested amendment, if successful, the Preferred C Stock will be accounted for within stockholders’ equity. The Company is currently unable to evaluate the impact of this event on its overall financial statements.