Debt	3 Months Ended
Mar. 31, 2015
Debt
Debt	Note 6 - Debt Demand notes In the fourth quarter of 2014 and first quarter of 2015, the Company raised $2.3 million through the issuance of short-term demand notes. In the first quarter of 2015, $0.3 million of demand notes, held by an entity controlled by our chief executive officer, were settled as partial payment for a 2015 convertible note. The demand notes bear interest at 8% per annum, have a first priority security interest in the assets of the Company, and a term of approximately 4 months before the holder can demand payment. The demand notes were tendered as payment for units in the Company’s IPO. See Note 11. 2014 convertible debt In July, August and September 2014, the Company raised $1.5 million through the issuance of convertible debt. The debt is convertible, at the option of the holders or in certain cases at the Company’s option, into shares of Series A Preferred Stock or other potential equity securities. The debt bears interest at 8% and is due in full on July 11, 2015. The 2014 convertible debt was converted in connection with the Company’s IPO in the second quarter of 2015. See Note 11. 2015 convertible debt In February and March 2015, the Company raised $1.5 million in capital through the issuance of 8% secured convertible notes with detachable stock purchase warrants. The 2015 convertible notes were pre-payable by the Company without penalty at any time following the three month anniversary of the closing of an IPO; provided that before the six-month anniversary of the closing of an IPO, the 2015 convertible notes could only be prepaid out of newly issued capital subsequent to the IPO, and are puttable by the holder to the Company in the event of a defined default. The 2015 convertible notes are each convertible, at the election of the holder, into shares of Series A Preferred Stock, at a conversion rate of 1.25 shares of Preferred Stock for each $1.00 converted, if the conversion occurs prior to closing of an IPO, or into shares of common stock, at a conversion rate of one share of common stock for each $1.00 converted, if the conversion occurs after the closing of an IPO. The 2015 convertible note holders also received detachable stock purchase warrants exercisable for 225,011 shares of common stock at 110% of the IPO price and exercisable only if the IPO occurred, and then exercisable beginning on the six month anniversary of the closing of the IPO. As a result of net settlement features, the stock purchase warrants are considered derivative liabilities, were initially recorded at fair value (resulting in a debt discount) and are marked-to-market at each balance sheet date through earnings. Additionally, the conversion option embedded in the convertible notes was determined to contain beneficial conversion features, resulting in the bifurcation of those features as an equity instrument (resulting in an additional debt discount). After allocation of the gross proceeds to the detachable stock purchase warrants and beneficial conversion feature, the total debt discount recognized was equal to the face value of the 2015 convertible notes. During the first quarter of 2015, the Company recognized a gain on the change in fair value of the derivative warrant liability of $31,831. The 2015 convertible debt was converted in connection with the Company’s IPO in the second quarter of 2015. See Note 11.

Note 6 - Debt

Demand notes

In the fourth quarter of 2014 and first quarter of 2015, the Company raised $2.3 million through the issuance of short-term demand notes. In the first quarter of 2015, $0.3 million of demand notes, held by an entity controlled by our chief executive officer, were settled as partial payment for a 2015 convertible note. The demand notes bear interest at 8% per annum, have a first priority security interest in the assets of the Company, and a term of approximately 4 months before the holder can demand payment. The demand notes were tendered as payment for units in the Company’s IPO. See Note 11.

2014 convertible debt

In July, August and September 2014, the Company raised $1.5 million through the issuance of convertible debt. The debt is convertible, at the option of the holders or in certain cases at the Company’s option, into shares of Series A Preferred Stock or other potential equity securities. The debt bears interest at 8% and is due in full on July 11, 2015. The 2014 convertible debt was converted in connection with the Company’s IPO in the second quarter of 2015. See Note 11.

2015 convertible debt

In February and March 2015, the Company raised $1.5 million in capital through the issuance of 8% secured convertible notes with detachable stock purchase warrants. The 2015 convertible notes were pre-payable by the Company without penalty at any time following the three month anniversary of the closing of an IPO; provided that before the six-month anniversary of the closing of an IPO, the 2015 convertible notes could only be prepaid out of newly issued capital subsequent to the IPO, and are puttable by the holder to the Company in the event of a defined default. The 2015 convertible notes are each convertible, at the election of the holder, into shares of Series A Preferred Stock, at a conversion rate of 1.25 shares of Preferred Stock for each $1.00 converted, if the conversion occurs prior to closing of an IPO, or into shares of common stock, at a conversion rate of one share of common stock for each $1.00 converted, if the conversion occurs after the closing of an IPO. The 2015 convertible note holders also received detachable stock purchase warrants exercisable for 225,011 shares of common stock at 110% of the IPO price and exercisable only if the IPO occurred, and then exercisable beginning on the six month anniversary of the closing of the IPO.

As a result of net settlement features, the stock purchase warrants are considered derivative liabilities, were initially recorded at fair value (resulting in a debt discount) and are marked-to-market at each balance sheet date through earnings. Additionally, the conversion option embedded in the convertible notes was determined to contain beneficial conversion features, resulting in the bifurcation of those features as an equity instrument (resulting in an additional debt discount). After allocation of the gross proceeds to the detachable stock purchase warrants and beneficial conversion feature, the total debt discount recognized was equal to the face value of the 2015 convertible notes. During the first quarter of 2015, the Company recognized a gain on the change in fair value of the derivative warrant liability of $31,831.

The 2015 convertible debt was converted in connection with the Company’s IPO in the second quarter of 2015. See Note 11.