|9 Months Ended|
Sep. 30, 2019
|Organization Consolidation And Presentation Of Financial Statements [Abstract]|
Note 7. Going Concern
On August 27, 2014, FASB issued ASU 2014-05, Disclosure of Uncertainties about an Entity’s ability to Continue as a Going Concern, which requires management to assess a company’s ability to continue as a going concern within one year from financial statement issuance and to provide related footnote disclosures in certain circumstances.
The Company has experienced significant operating losses over the past 3 years (2016 through 2019) with cumulative losses of approximately $12,677,000. These losses resulted in the usage of all cash proceeds from the Company’s initial public offering in 2015. The Company’s net cash used in operating activities for the nine months ended September 30, 2019 was approximately 908,000 and net working capital is a negative $267,000. These conditions raise substantial doubt about the Company’s ability to continue as a going concern.
Under a purchase agreement dated January 16, 2019, the Company owes Craven $3,461,782 which may be converted into common stock or paid in cash by January 16, 2020.
The Company will explore ways to either convert the Craven note into common stock or explore options to refinance the Craven note by unlocking value across a range of assets, including exploring ways to maximize the value of our unsecured debt owed by current and former owners of the condominium units.
The Company has a history of refinancing debt and management is confident that it will be able to successfully refinance the current Craven note and/or obtain new financing to pay off the Craven note.
However, we cannot predict, with certainty, the outcome of our actions to generate liquidity, including the availability of additional debt financing, or whether such actions would generate the expected liquidity as currently planned.
The entire disclosure when substantial doubt is raised about the ability to continue as a going concern. Includes, but is not limited to, principal conditions or events that raised substantial doubt about the ability to continue as a going concern, management's evaluation of the significance of those conditions or events in relation to the ability to meet its obligations, and management's plans that alleviated or are intended to mitigate the conditions or events that raise substantial doubt about the ability to continue as a going concern.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef