Annual report pursuant to Section 13 and 15(d)

10. Common Stock Liability

10. Common Stock Liability
12 Months Ended
Mar. 31, 2021
Effect of state operating loss expiration  
Common Stock Liability

NOTE 10 – Common Stock Liability


On October 4, 2018, the Company sold 12,556 shares of common stock, at a price of $21.51 per share, through its At Market Issuance Sales Agreement with B. Riley FBR, Inc. for gross proceeds of $270,000 and net proceeds of $262,000 after deducting commissions and other offering expenses. This sale exceeded the aggregate market value of the Company’s securities sold during the period of twelve calendar months prior to the sale of one-third of the aggregate market value of its common stock held by non-affiliates, and thus, the 12,556 shares of common stock were unregistered. The Company could be liable in the event claims or suits for rescission are brought and successfully concluded for failure to register these securities or for acts or omissions constituting offenses under the Securities Act, the Securities Exchange Act of 1934, or applicable state securities laws. The Company could be liable for damages and penalties assessed by the SEC and state securities regulators. Accordingly, at March 31, 2019, the Company recorded a $270,000 liability in the accompanying consolidated balance sheet. The statute of limitations expired in October 2019, and as a result the liability was released and was reclassified to equity on the Company’s consolidated balance sheet at March 31, 2020.