|
Filed
Pursuant to Rule 424(b)(3)
|
|
Registration
No. 333-115548
|
1)
|
Update
our prospectus dated August 13, 2007 with the attached following
document:
|
a.
|
Financial
Information for the quarterly period ended: September 30,
2007.
|
|
Annex
|
|
|
Financial
Information for the quarterly period ended: September 30,
2007
|
A
|
September
30, 2007
|
||||
ASSETS
|
||||
CURRENT
ASSETS:
|
||||
Cash
and cash equivalents
|
$
|
2,680,334
|
||
Investment
in marketable debt instruments, held-to-maturity
|
1,993,633
|
|||
Accounts
receivable
|
31,804
|
|||
Prepaid
expenses and other current assets
|
578,811
|
|||
Inventory
|
133,308
|
|||
Costs
and estimated earnings in excess of billings on contracts
|
5,892
|
|||
Deposit
on purchase of inventory
|
648,960
|
|||
Total
current assets
|
6,072,742
|
|||
PROPERTY
AND EQUIPMENT, NET
|
500,464
|
|||
SOFTWARE
DEVELOPMENT COSTS, NET
|
642,830
|
|||
INTANGIBLE
ASSETS, NET
|
401,156
|
|||
Total
assets
|
$
|
7,617,192
|
||
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
||||
CURRENT
LIABILITIES:
|
||||
Accounts
payable
|
$
|
229,265
|
||
Accrued
payroll related liabilities
|
117,622
|
|||
Accrued
expenses
|
283,439
|
|||
Accrued
expenses - related parties
|
18,753
|
|||
Deferred
revenue
|
46,779
|
|||
Total
current liabilities
|
695,858
|
|||
COMMITMENTS
AND CONTINGENCIES
|
||||
STOCKHOLDERS'
EQUITY:
|
||||
Common
stock, authorized 150,000,000 shares, $0.01 par value; 31,898,955
shares
issued and outstanding
|
318,990
|
|||
Additional
paid-in capital
|
24,800,998
|
|||
Accumulated
deficit
|
(18,194,049
|
)
|
||
Accumulated
other comprehensive income (loss)
|
(4,605
|
)
|
||
Total
stockholders' equity
|
6,921,334
|
|||
Total
liabilities and stockholders' equity
|
$
|
7,617,192
|
For
The Three Months
Ended
September
30,
|
For
The Nine Months
Ended
September
30,
|
||||||||||||
2007
|
2006
|
2007
|
2006
|
||||||||||
Revenue:
|
|||||||||||||
Project
|
$
|
5,892
|
$
|
56,212
|
$
|
164,796
|
$
|
137,562
|
|||||
Product
|
81,785
|
(231
|
)
|
117,275
|
1,980
|
||||||||
Total
revenue
|
87,677
|
55,981
|
282,071
|
139,542
|
|||||||||
Cost
of goods sold:
|
|||||||||||||
Project
|
2,569
|
37,132
|
126,304
|
100,699
|
|||||||||
Product
|
87,896
|
-
|
129,341
|
-
|
|||||||||
Total
cost of goods sold
|
90,465
|
37,132
|
255,645
|
100,699
|
|||||||||
Gross
profit
|
(2,788
|
)
|
18,849
|
26,426
|
38,843
|
||||||||
Operating
expenses
|
|||||||||||||
Research
and development
|
290,932
|
87,802
|
913,573
|
251,346
|
|||||||||
General
and administrative
|
1,160,109
|
922,241
|
3,730,676
|
1,943,231
|
|||||||||
Depreciation
and amortization
|
93,879
|
25,812
|
202,996
|
75,710
|
|||||||||
Sales
and marketing
|
452,148
|
37,975
|
770,197
|
124,410
|
|||||||||
Total
operating expenses
|
1,997,068
|
1,073,830
|
5,617,442
|
2,394,697
|
|||||||||
Loss
from operations
|
(1,999,856
|
)
|
(1,054,981
|
)
|
(5,591,016
|
)
|
(2,355,854
|
)
|
|||||
Other
(income) expense
|
|||||||||||||
Interest
income
|
(85,025
|
)
|
(139
|
)
|
(192,573
|
)
|
(139
|
)
|
|||||
Interest
expense
|
2,979
|
5,747
|
146,699
|
206,656
|
|||||||||
Net
other expenses
|
(82,046
|
)
|
5,608
|
(45,874
|
)
|
206,517
|
|||||||
Net
loss
|
(1,917,810
|
)
|
(1,060,589
|
)
|
(5,545,142
|
)
|
(2,562,371
|
)
|
|||||
Preferred
stock accretion
|
-
|
-
|
-
|
(170,974
|
)
|
||||||||
Net
loss available to common stockholders
|
$
|
(1,917,810
|
)
|
$
|
(1,060,589
|
)
|
$
|
(5,545,142
|
)
|
$
|
(2,733,345
|
)
|
|
Loss
per share, basic and diluted:
|
|||||||||||||
Net
loss
|
$
|
(0.06
|
)
|
$
|
(0.06
|
)
|
$
|
(0.19
|
)
|
$
|
(0.15
|
)
|
|
Net
loss available to common stockholders
|
$
|
(0.06
|
)
|
$
|
(0.06
|
)
|
$
|
(0.19
|
)
|
$
|
(0.16
|
)
|
|
Weighted-average
common shares outstanding, basic and diluted
|
31,626,498
|
18,201,060
|
28,772,362
|
16,944,987
|
Accumulated
|
|||||||||||||||||||
Additional
|
Other
|
||||||||||||||||||
Common
Stock
|
Paid-in
|
Accumulated
|
Comprehensive
|
||||||||||||||||
Shares
|
Amount
|
Capital
|
(Deficit)
|
Income
(Loss)
|
Total
|
||||||||||||||
Balances,
December 31, 2006
|
19,894,091
|
$
|
198,942
|
$
|
12,624,562
|
$
|
(12,648,907
|
)
|
$
|
(4,605
|
)
|
$
|
169,992
|
||||||
Common
stock sold for cash, net of offering costs of $439,364
|
10,330,000
|
103,300
|
9,787,336
|
-
|
-
|
9,890,636
|
|||||||||||||
Common
stock issued related to exercise of options/warrants
|
444,811
|
4,448
|
132,132
|
-
|
-
|
136,580
|
|||||||||||||
Common
stock issued to consultants for services
|
381,018
|
3,810
|
430,192
|
-
|
-
|
434,002
|
|||||||||||||
Common
stock issued for repayment of notes payable
|
232,627
|
2,326
|
355,755
|
-
|
-
|
358,081
|
|||||||||||||
Common
stock issued for settlement of accrued liabilities
|
507,701
|
5,077
|
595,327
|
-
|
-
|
600,404
|
|||||||||||||
Options
vested for employees services
|
-
|
-
|
303,878
|
-
|
-
|
303,878
|
|||||||||||||
Options
vested to consultants for services
|
-
|
-
|
562,902
|
-
|
-
|
562,902
|
|||||||||||||
Common
stock issued for purchase of licenses
|
9,260
|
93
|
9,908
|
-
|
-
|
10,001
|
|||||||||||||
Common
stock issued pursuant to previous investment agreements
|
99,447
|
994
|
(994
|
)
|
-
|
-
|
-
|
||||||||||||
Net
loss
|
-
|
-
|
-
|
(5,545,142
|
)
|
-
|
(5,545,142
|
)
|
|||||||||||
Balances,
September 30, 2007
|
31,898,955
|
$
|
318,990
|
$
|
24,800,998
|
$
|
(18,194,049
|
)
|
$
|
(4,605
|
)
|
$
|
6,921,334
|
For
The Nine Months Ended
September
30,
|
|||||||
2007
|
2006
|
||||||
Cash
flows from (to) operating activities:
|
|||||||
Net
loss
|
$
|
(5,545,142
|
)
|
$
|
(2,562,371
|
)
|
|
Adjustments
to reconcile net loss to net cash provided by (used in) operating
activities
|
|||||||
Depreciation
and amortization
|
202,996
|
75,710
|
|||||
Common
stock issued for services
|
434,002
|
105,938
|
|||||
Options
issued to employees and consultants for services
|
866,780
|
843,332
|
|||||
Reprice
of warrants previously granted in debt offering
|
-
|
155,748
|
|||||
Changes
in operating assets and liabilities:
|
|||||||
Accounts
receivable
|
(31,804
|
)
|
74,650
|
||||
Prepaid
expenses
|
(1,133,704
|
)
|
(27,097
|
)
|
|||
Inventory
|
(133,308
|
)
|
-
|
||||
Deferred
financing costs
|
-
|
(70,322
|
)
|
||||
Deposits
|
283,071
|
-
|
|||||
Accounts
payable and accrued liabilities
|
218,459
|
272,595
|
|||||
Accrued
expenses related party
|
(53,122
|
)
|
-
|
||||
Deferred
revenue
|
46,779
|
-
|
|||||
Costs
and estimated earnings in excess of billings on contracts,
net
|
(5,892
|
)
|
(59,098
|
)
|
|||
Billings
in excess of costs and estimated earnings on contracts,
net
|
(5,500
|
)
|
(4,370
|
)
|
|||
Net
cash (used in) operating activities
|
(4,856,385
|
)
|
(1,195,285
|
)
|
|||
Cash
flows from (to) investing activities:
|
|||||||
Capital
outlay for software development costs
|
(406,519
|
)
|
-
|
||||
Capital
outlay for investment in marketable debt instruments
|
(1,993,633
|
)
|
-
|
||||
Purchase
of licensing rights
|
(155,462
|
)
|
(11,731
|
)
|
|||
Property
and equipment acquisitions
|
(244,809
|
)
|
(22,498
|
)
|
|||
Net
cash (used in) investing activities
|
(2,800,423
|
)
|
(34,229
|
)
|
|||
Cash
flows from (to) financing activities:
|
|||||||
Proceeds
from exercise of options
|
136,684
|
-
|
|||||
Proceeds
from issuance of common stock
|
10,330,000
|
1,925,000
|
|||||
Offering
costs
|
(385,010
|
)
|
(14,500
|
)
|
|||
Proceeds
from notes payable
|
-
|
340,000
|
|||||
Repayment
of notes payable
|
-
|
(240,000
|
)
|
||||
Net
cash provided by financing activities
|
10,081,674
|
2,010,500
|
|||||
Net
increase (decrease) in cash and cash equivalents
|
2,424,866
|
780,986
|
|||||
Cash
and cash equivalents at beginning of period
|
255,468
|
42,127
|
|||||
Cash
and cash equivalents at end of period
|
$
|
2,680,334
|
$
|
823,113
|
|||
Supplemental
information:
|
|||||||
Interest
paid
|
$
|
-
|
$
|
-
|
|||
Income
taxes paid
|
$
|
-
|
$
|
-
|
|||
Non-cash
investing and financing activities:
|
|||||||
Deferred
financing cost recognized and netted against paid-in
capital
|
$
|
54,354
|
$
|
-
|
|||
Purchase
of licenses with common stock
|
$
|
10,001
|
$
|
-
|
|||
Payment
of accrued research and development liabilities with common
stock
|
$
|
-
|
$
|
465,000
|
|||
Payment
of notes payable and accrued interest with common stock
|
$
|
358,081
|
$
|
983,846
|
|||
Payment
of accrued liabilities with common stock
|
$
|
585,634
|
$
|
-
|
|||
Fair
value accretion on conditionally redeemable, convertible preferred
stock
|
$
|
-
|
$
|
170,974
|
Year
Ended December 31,
|
||||
2007
|
49,166
|
|||
2008
|
129,997
|
|||
2009
|
129,719
|
|||
2010
|
48,443
|
|||
2011
and after
|
43,831
|
|||
Total
|
$
|
401,156
|
Costs
and estimated earnings incurred on uncompleted contracts
|
$
|
5,892
|
||
Billings
on uncompleted contracts
|
-
|
|||
Costs
and estimated earnings in excess of billings on uncompleted
contracts
|
$
|
5,892
|
Billings
on uncompleted contracts
|
$
|
-
|
||
Costs
and estimated earnings incurred on uncompleted contracts
|
-
|
|||
Billings
in excess of costs and estimated earnings on uncompleted
contracts
|
$
|
-
|
Licensing
agreements
|
$
|
627,491
|
||
Patent
|
40,707
|
|||
Less
accumulated amortization
|
(267,042
|
)
|
||
$
|
401,156
|