The following discussion and analysis should be read in conjunction with the
Audited Financial Statements and related notes included elsewhere in this 10-K.
The following discussion includes certain forward-looking statements. For a
discussion of important factors which could cause actual results to differ
materially from the results referred to in the forward-looking statements, see
“Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements”.
Recent Highlights of
·
During 2013,
independent lab at
significant impact on resistance to soybean cyst nematodes.
·
During 2019, we identified our FusR1 gene in bananas for disease resistance and
filed a patent application.
·
During 2020, WCIC completed a project for the Company to transform soybean
plants using our EG261 and EG19 genes and to develop resulting plants through
generation T2 seeds.
·
During 2020, we entered into the DCA with Dole and a Research Agreement with
WCIC for the development of the FusR1 gene and banana plants that are resistant
to Panama Disease.
Consolidated Results of Operations:
Twelve Months Ended December 31,
2020 2019
Percent of Percent of
Amount Revenue Amount Revenue
Grant revenue $ 12,500 100.0 % $ 122,686 100.0 %
Research and development 1,793,145 14345.2 % 472,613 385.2 %
Salaries and benefits 495,518 3964.1 % 205,828 167.8 %
General and administrative 603,632 4829.1 % 219,070 178.6 %
Total operating expenses 2,892,295 23138.4 % 897,511 731.6 %
Operating loss (2,879,795 ) -23038.4 % (774,825 ) -631.6 %
Other income and (expenses) 180,559 1444.5 % 13,592 11.1 %
Income Taxes 987,353 7898.8 % (31,907 ) -26.0 %
Net loss $ (1,711,883 ) -13695.1 % $ (793,140 ) -646.5 %
Preferred stock dividend (285,567 ) -2284.5 % (269,379 ) -219.6 %
Net loss attributable to
common stockholders $ (1,997,450 ) -15979.6 % $ (1,062,519 ) -866.0 %
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Grant Revenue
Grant revenue decreased
decrease was primarily due to the decrease in revenue received from the
Colorado
Operating Expenses
Operating expenses increased
ended
Operating expenses consist of research and development expense, salaries and
benefits and general and administrative expense. Changes in these items are
described below.
Research and Development
Research and development increased
year ended
The increase was primarily due to increased costs incurred on our research
agreement with
of our Development and Commercialization Agreement with
provides funding for our banana project expenses at the
in the form of notes payable.
Salaries and Benefits
Salaries and benefits increased
ended
increase was due to bonuses paid in the year ended
increased stock compensation costs.
General and Administrative
General and administrative expenses increased
for the year ended
31, 2019
which began in the year ended
Other Income and (Expenses)
Total other income and (expenses) increased
for the year ended
31, 2019
investments and forgiveness of our Small Business Administration Payroll
Protection Program loan (“PPP”).
Income Taxes
Income tax benefit increased
31, 2020
2019
development into service and the asset now having a finite life.
Net Loss
Net loss increased
increase was primarily due to increased costs incurred on our research agreement
with the
increased costs for the amortization of our intangible asset and increased
bonuses and stock compensation costs partially offset by the income tax benefit,
PPP loan forgiveness and gains on investments.
Financial Condition
The Company’s working capital increased
2020
payable from Dole, PPP loan and Economic Injury Disaster Loan (“EIDL”) and sale
of our investments partially offset by the net loss from operations, increases
in prepaid expenses and decreases in accounts payable and accrued expenses.
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Liquidity and Capital Resources
The Company has historically financed operations through cash flows from
operations and equity transactions. Net cash used in operating activities was
year ended
due to the increased net operating loss. Net cash provided from the sale of
investments was
the year ended
was
year ended
As of
2020 used
for 2021 requires cash of
to the Company’s ability to continue as a going concern.
To address these factors, management believes that it will secure additional
funding to meet prospective cash requirements. Management believes the
Company’s existing cash balances along with funding from our agreement with
Dole, prospective funding from marketing additional genes, and additional
contributions from our largest shareholder will provide the necessary liquidity
to meet our obligations as they come due over the next year. We expect that the
funding from these sources will be more than enough to cover our obligations for
the next twelve months. However, if the funding does not arrive, the Company
may not be able to meet its obligations as they become due.
Off-Balance Sheet Arrangements
The Company has no off-balance sheet arrangements that have a material current
effect, or that are reasonably likely to have a material future effect, on its
financial condition, changes in financial condition, revenue or expenses,
results of operations, liquidity, capital expenditures, or capital resources.
Contractual Obligations
The Company leases its operating facility on a month-to-month basis, with
monthly rental installments of
ended
Critical Accounting Policies
For a review of our critical accounting policies, please refer to our audited
financial statements.
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