NANOFLEX POWER CORPORATION
17207 N Perimeter Dr., Suite 210
Scottsdale, AZ 85255
November 25, 2013
BY EDGAR
Ms. Pamela Long, Assistant Director
United States Securities and Exchange Commission
Division of Corporation Finance
100 F. Street, N.E.
Washington, D.C. 20549
| Re: | NanoFlex Power Corporation (f/k/a Universal Technology Systems Corp., the “Company”) Form 8-K Filed September 30, 2013 (the “8-K”) File No. 333-187308 |
Dear Ms. Long:
Reference is made to your comment letter, dated October 25, 2013, to the Company, relating to the subject filing (the “Comment Letter”). Set forth below are the comments contained in the Comment Letter followed by the Company’s responses thereto:
Comment #1:
General
| | 1. | As a result of your reverse merger on September 24, 2013, it appears that you have had a change in accountant. Please tell us how you have complied with the disclosure requirements of Item 4.01 of Form 8-K and Item 304 of Regulation S-K regarding your change in accountant. |
As of September 24, 2013, the Company had not changed its auditors. The board of directors of the Company approved and ratified the change of auditors on October 22, 2013. Such change of auditors was disclosed in the Company’s current report on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) on October 30, 2013.
Comment #2:
Item 1.01, page 2
| | 2. | Please amend to include disclosure under Item 1.01 of Form 8-K to state that you entered into a reverse merger and identify the legal and accounting acquirer in the transaction. |
We have revised the 8-K in response to Comment No. 2 on page 3 of the 8-K/A as follows:
“Our acquisition of GPEC pursuant to the Share Exchange Agreement was accounted for as a reverse merger and recapitalization effected by a share exchange. GPEC is considered the acquirer for accounting and financial reporting purposes. The assets and liabilities of the acquired entity have been brought forward at their book value and no goodwill has been recognized.”
Comment #3:
Summary Business Developments, page 6
| | 3. | Please clearly disclose in the beginning of this section that Global Photonic Energy Corporation is a development stage company that has not manufactured, sold or licensed any products, that has incurred losses to date, has no revenue, and has a going concern opinion from its auditor. |
We have revised the 8-K in response to Comment No. 3 on page 6 of the 8-K/A as follows:
“Summary Business Description
GPEC is engaged in the development, commercialization, and licensing of advanced photovoltaic technologies and intellectual property. GPEC’s sponsored research programs have resulted in intellectual property portfolio consisting of more than 600 issued or pending patents worldwide covering materials, architectures, and fabrication processes for organic and inorganic flexible, thin-film photovoltaic technologies. We believe GPEC is a leader in advanced solar cell technologies that have the potential to redefine the solar industry. We also believe its proprietary technologies can fundamentally change the traditional paradigm of solar energy conversion – from applications defined by the conventional constraints of fixed, heavy, rigid and expensive to applications that are highly mobile, lightweight, flexible and inexpensive. Since its inception, GPEC has invested more than $52 million in capital for operations and development activities. GPEC’s sponsored research activities have generated a patent portfolio of more than 600 issued or pending patents worldwide to which the Company has exclusive commercial rights. The patents cover architecture, processes and materials for flexible, thin-film OPV technologies and inorganic GaAs technologies. Currently, the Company is preparing to enter the applied research and pre-commercialization stage for both of these technology platforms with the near-term goal of establishing a technology development center in Ann Arbor, Michigan, that will enable:
| | ● | The development and commercialization of advanced organic and inorganic thin film solar cell technologies, including proprietary materials, architectures, and fabrication processes, that have the potential to transform the industry. |
| | | |
| | ● | GPEC to enter partnerships with manufacturers. |
| | | |
| | ● | GPEC to generate early revenue from government grants in an accelerated two-year program. |
GPEC is currently at development stage and has not licensed any of its technologies. GPEC has incurred losses and has no revenue to date. GPEC’s auditors’ opinion stated that there is substantial doubt about the Company’s ability to continue as a going concern.”
Comment #4:
| | 4. | We note disclosure throughout the filing that GPEC’s sponsored research activities have generated a patent portfolio of more than 600 issued or pending patents to which the company has exclusive commercial rights. Please revise to clearly disclose the duration of such patents. Please also disclose separately the number of issued and pending patents. |
We have revised the 8-K in response to Comment No. 4 on pages 6 and 9 of the 8-K/A to reflect the following:
“As of October 1, 2013, the Company’s sponsored research has resulted in 57 issued patents, 46 pending non-provisional applications and 15 pending provisional applications in the U.S. In addition, the Company’s sponsored research has resulted in 151 issued patents, 388 pending patent applications and 19 pending PCT applications in countries and regions outside the U.S. All the issued U.S. and foreign patents have lifetime of 20 years from their respective effective filing dates. “
Philosophy and Approach, page 6
| | 5. | We note the statement that “We believe GPEC is well positioned to be one of the leading industry players in developing solar solutions . . .” Please revise to clearly explain the basis of this statement. |
We have revised the 8-K by deleting such statement.
Comment #6:
Development Goals, page 11
| | 6. | Please disclose whether you have financing plans to further your development goals. |
We have revised the 8-K in response to Comment No. 6 on page 11 of the 8-K/A as follows:
In order to accomplish these tasks and to give confidence to our manufacturing partners, GPEC plans to build a technology development center in Ann Arbor, Michigan. We plan to obtain cost-effective leased facilities and will equip the facility with required equipment and obtain required engineering personnel. This infrastructure will support our objective of producing 6 inch square GaAs and OPV module prototypes to demonstrate the efficacy of our technology platforms and to substantially reduce the risk to large-scale market entry by our licensed partners. We believe that the costs of establishing the facility will be approximately $5,500,000 and expect that it can be in place by the first quarter of 2014. The Plan of Operation that is in place is dependent upon the Company’s ability to raise additional capital to support its research and development operations. Since its inception, GPEC has raised over $60,000,000 from various investors, which has been invested primarily in research and development activities and maintaining GPEC’s patent portfolio. GPEC anticipates that it will need to raise approximately $18,000,000 over the next 24 months until it earns sufficient revenue to support its operations, including its continuing research and development goals and patent prosecutions and to maintain its intellectual property portfolio. The following is a breakdown of the $18,000,000 budget:
| R&D Payroll (technology development center) | | $ | 2,275,000 | |
| R&D Sponsored Research | | $ | 2,856,000 | |
| R&D Operating Expenses (technology development center) | | $ | 948,000 | |
| R&D Equipment Purchases (technology development center) | | $ | 1,950,000 | |
| Patent Prosecution and App Fees | | $ | 3,045,000 | |
| General and Administrative | | $ | 6,926,000 | |
Comment #7:
Competition, page 12
| | 7. | Please disclose as applicable competition you face from other companies with the same business model, namely licensing of intellectual property. |
We do not believe that GPEC will face competition from the comparable companies that are also licensing OPV and GaAs technologies, because our OPV and GaAs technologies are unique and are patented.
Comment #8:
Description of Property, page 17
| | 8. | Please disclose from whom you are leasing your property free of charge. |
We have revised the 8-K in response to Comment No. 8 on page 17 of the 8-K/A as follows:
“The Company’s executive offices are currently located at 17207 N Perimeter Dr., Suite 210, Scottsdale, AZ 85255 and it started leasing it offices from DTR10, LLC on November 15, 2013. The office space is approximately 3,077 square feet. Its monthly rental is $6,410 during the first year of the lease and will be subject to 3% increase in the following years. The Company’s headquarter was formerly at 20 Trading Post Way, Medford Lakes, New Jersey 08055 in a 500 square foot space which was provided to GPEC free of charge by a spouse of GPEC’s officer.”
Comment #9:
Directors, Executive Officers and Corporate Governance, page 18
| | 9. | Please revise to discuss, for each director, the specific experience, qualifications, attributes or skills that led to the conclusion that the person should serve as a director. Please refer to Item 401(e) of Regulation S-K. |
We have revised the 8-K in response to Comment No. 9 on page 18 of the 8-K/A as follows:
“John D. Kuhns, age 63, is the Executive Chairman of the Board of the Company and of GPEC. Mr. Kuhns became an investor in GPEC in 1999, and has served as a Director of GPEC since April of 2000. He was appointed to serve as Director of the Company on September 24, 2013. In the last 30 years, Mr. Kuhns has founded and completed five initial public offerings for renewable energy companies. Most recently in 2006 he founded China Hydroelectric Corporation (NYSE: CHC), China’s largest foreign-owned hydroelectric power company. China Hydro listed its shares on the New York Stock Exchange in January of 2010. Mr. Kuhns served as Chairman of the Board of China Hydro from 2006 until 2012. In 1988, Mr. Kuhns founded The New World Power Corporation (NASDAQ: NWPC), where he served as Chairman of the Board of directors. This company was the first wind farm company to go public. In 1981, Mr. Kuhns was also the founder of Catalyst Energy Corporation (NYSE: CE), one of the country’s most successful hydroelectric developers and recognized by Inc. Magazine as the nation's fastest growing public company in the five years from 1982 to 1987. Mr. Kuhns is the Chairman and CEO of Kuhns Brothers, an investment banking boutique and one of the oldest continually operating investment firms in the United States, tracing its origins to 1842. Mr. Kuhns is a graduate of the Harvard Business School (M.B.A., 1977), the University of Chicago (M.F.A. in Fine Arts, 1975) and Georgetown University (A.B., in Sociology and in Fine Arts, 1972), where he was captain of the varsity football team and is a member of the University's Athletic Hall of Fame. Mr. Kuhns was selected to serve originally as a Director of GPEC and now as a Director of the Company due in part to his comprehensive knowledge gained over the last 30 years in all aspects of the Green Energy field. He also has accumulated vast experience and understanding of all business aspects and competitive worldwide environment for solar power.
Dean L. Ledger, age 65, has served as a Director and senior executive of GPEC since its inception in 1994 and was instrumental in its founding. Mr. Ledger is GPEC’s Chief Executive Officer, and was elected as the Chief Executive Officer of the Company on September 24, 2013. Mr. Ledger has significant experience in capital formation and business building as he played instrumental roles in both Universal Display Corporation (NASDAQ: OLED) and InterDigital Corporation (NASDAQ: IDCC) from their inception. From 1994 to 2012, Mr. Ledger served as Executive Vice President-Corporate Development of Universal Display Corporation. From July 1994 to January 2001, Mr. Ledger served as a member of the Board of Directors of Universal Display Corporation. From December 2001 to July 2003, Mr. Ledger served as a member of the Board of Directors of North American Technologies, Inc. (NASDAQ: NATK). From May 1991 until October 1992, Mr. Ledger was a consultant to the IntelCom Group. Mr. Ledger served as a consultant to InterDigital Communications Corporation from October 1989 to April 1991. Prior to October 1989, Mr. Ledger spent 12 years as a financial consultant with E.F. Hutton, Shearson Lehman Brothers and Paine Webber. He is a graduate of Colorado College (B.A., Business Administration, 1972).
The Board concluded that Mr. Ledger should serve as a Director of the Company based on his extensive experience and knowledge of the history of our Company and of all of its related technologies. Furthermore, he has a proven track record in leveraging information technology to capture new commercial opportunities and to increase operational efficiencies in various industries.
Robert J. Fasnacht, age 56, is a director, President and Chief Operating Officer of GPEC and he was elected as a director, President and Chief Operating Officer of the Company on September 24, 2013. He first joined GPEC in 2011 as its Executive Vice President, General Counsel and corporate Secretary. Prior to that, he was engaged in a private legal practice emphasizing both corporate transactions and complex civil litigation. He also served for a number of years as a Board Member of various U.S. companies, including a U.S. based privately held restaurant Franchisor. He is admitted to practice in the 9th Circuit Court of Appeals, along with several state and federal courts, including the U.S. Tax Court. Mr. Fasnacht is a graduate of the University of Idaho (B.S., Chemistry, 1983 and J.D., 1985). Mr. Fasnacht was selected as a Director due to his extensive knowledge both from his scientific education and his legal training on all aspects of the Company’s Organic and Inorganic Photovoltaic Technologies and on its related intellectual property portfolio. He also demonstrated an extraordinary ability to understand the business and technological aspects of the Company as they relate to the Company’s strategic roll moving forward.”
Comment #10:
Transactions with Related Persons, Promoters and Control Persons, page 20
| | 10. | We note the related party disclosure in Note 4 on page F-11. Please revise to provide such related party disclosure in this section of the Form 8-K as well. |
We have revised the 8-K in response to Comment No. 10 on page 20 of the 8-K/A as follows:
“Our policy is that a contract or transaction either between the Company and a director, or between a director and another company in which he is financially interested is not necessarily void or voidable if the relationship or interest is disclosed or known to the Board of Directors and the stockholders are entitled to vote on the issue, or if it is fair and reasonable to our company.
On September 24, 2013, Mr. Christopher Conley, a shareholder, director and chief executive officer of GPEC, and GPEC consummated a Stock Purchase Agreement, pursuant to which Mr. Conley sold to GPEC an aggregate of 9,000,000 shares of GPEC’s common stock representing approximately 75% of the then issued and outstanding shares of GPEC common stock for an aggregate sales price of $249,000. GPEC agreed to cancel the shares purchased from Mr. Conley following the issuance of common stock in accordance with the Share Exchange Agreement.
Dean L. Ledger the Chief Executive Officer of GPEC, loaned GPEC $150,000 in 2010 and an additional $250,000 during 2011. The outstanding loans of $400,000 were repaid during the first six months of 2013. During the first six months of 2013 Mr. Ledger loaned GPEC an additional $240,000, which amount was repaid in July 2013.
During 2012 and 2011, GPEC borrowed $2,130,000 and $1,750,000, respectively from Ronald B. Foster, a majority shareholder of the Company. These loans are unsecured, bear interest at 5% per annum and originally matured December 22, 2012. In connection with the loans, on January 31, 2012, the note holder was guaranteed 4,000,000 Class A common shares of GPEC. On May 23, 2012, the Company entered into an amended debt agreement with the shareholder whereby all accrued interest was paid in cash and the interest rate of 5% was replaced with a fixed amount of interest of $10,000 for all existing debt and any future debt. In 2012, the Company made cash payments on these notes totaling $630,000 and the remaining $4,000,000 was converted to 4,000 shares of Series A Convertible Preferred Stock of GPEC. On September 24, 2013, such holder of 4,000 shares of Series A Convertible Preferred Stock of GPEC received a total of 4,400,000 shares of Common Stock and warrant to purchase 4,400,000 shares of Common Stock pursuant to the Share Exchange Agreement.”
Comment #11:
Description of Securities, page 23 Warrants, page 24
Piggy-back Registration Rights, page 24
| | 11. | Please disclose whether or not there are any cash penalties under the registration rights agreement. Please also disclose any additional penalties resulting from delays in registering your common stock. Refer to FASB ASC 825-20-50-1. |
There is no penalty if the Company delays registering the Company’s Common Stock as required by the Warrants.
Comment #12:
Item 5.01 Changes in Control of Registrant, page 27
| | 12. | Please revise this section to disclose the source of funds used to acquire the shares of Mr. Conley. |
We have revised the 8-K in response to Comment No. 12 on page 27 of the 8-K/A as follows:
“On September 24, 2013, Christopher Conley (“Conley”), a majority shareholder of the Company, entered into a Stock Purchase Agreement (the “Purchase Agreement,” such transaction, the “Purchase Transaction”) with GPEC, pursuant to which Conley sold to GPEC 9,000,000 shares of Common Stock of the Company (the “Control Shares”) for $249,000. GPEC used the proceeds of the Bridge Financing for the acquisition of the Control Shares. Immediately after the Purchase Transaction on September 24, 2013, the acquired Control Shares were cancelled.
Simultaneously with the consummation of the Purchase Transaction, the Company consummated the Share Exchange Transaction with GPEC and the GPEC Stockholder, whereby the GPEC Stockholder received an aggregate of 15,438,866 shares of the Company’s Common Stock in exchange for the assignment to the Company of 100% of the equity interests of GPEC.”
Comment #13:
Signatures, page 29
| | 13. | We note your reference to the Securities Act of 1933. Please revise to refer to the Securities Exchange Act of 1934. Please see the Form 8-K instructions. |
We will revise the 8-K accordingly.
Comment #14:
Exhibits
| | 14. | We note disclosure of your amended exclusive license agreement with USC, Princeton and the University of Michigan. Please file such agreement with your next amendment or tell us why you are not required to do so. |
We believe certain parts of the license agreements between GPEC and USC, University of Princeton and University of Michigan contain proprietary information, the disclosure of which will place the Company at a severe competitive disadvantage and lead to the loss of the Company’s investments. We will file an application for confidential treatment together with copies of the referenced agreements with the SEC.
Comment #15:
| | 15. | Please file signed employment agreements with your next amendment. |
We will revise the 8-K accordingly.
Response #16:
The amended 8K Prom Forma statements have been updated accordingly to include the GPEC consolidated statement of expenses for the six months ended June 30, 2013.
Comment #17:
| | 16. | We have the following comments regarding your earnings per share information: |
| | ● | Provide the calculations used to determine your earnings per share. Please specifically address how you determined the historical weighted average shares outstanding for Global Photonic Energy Corporation and how you accounted for the cancellation of the 9,000,000 UTCH shares; |
| | ● | Include a reconciliation between the historical and pro forma weighted average shares used in computing basic and diluted earnings per share; and- |
| | ● | Disclose any shares not included for anti-dilution reasons. Refer to ASC 260-10-50-1c. |
Response #17:
| | ● | Please refer to Schedule A hereto for the calculation for the historical weighted average shares calculation of GPEC. The 8K/A has been updated accordingly for the correct historical weighted average shares. The 9 million cancelled shares have been accounted for as cancelled on the first day of the period being presented. In addition, the 8K/A Pro Forma statements have been updated to reflect the correct number of shares outstanding on the date of the merger. The GPEC shares decreased from 77,593,047 to 77,194,330. This is disclosed in the subsequent footnote for the period end June 30, 2013 financial statements included in the 8K/A. |
| | ● | See the attached calculation for historical and pro forma weighted average shares |
| | ● | There are no shares not included for anti-dilution reasons |
Comment #18:
Note 1 – Pro Forma Adjustments to Balance Sheet...., page F-32
| | 17. | Please separately present adjustments related to transactions that are not yet reflected in your financial statements in addition to reflecting transactions related to the Purchase Agreement. In this regard, we refer you to the subsequent events discussed in the second paragraph in Note 10 – Subsequent Events on page F-29 which are not reflected in your historical financial statements, such as the $5,255,000 borrowings from a majority shareholder and $2,139,500 from private investors in the form of convertible short term note agreements but you are reflecting the issuance of UTCH shares in exchange for such obligations. |
Response #18:
The 8K/A Pro Forma statements have been updated accordingly to reflect the correct amount of borrowings from the majority shareholder and from third party private investors. The total subsequent borrowings decreased from $5,255,000 to $4,700,000 for the majority shareholder and decreased from $2,139,500 to $2,124,500 for third party private investors.
The 8K/A with year end December 31, 2013 and period end June 30, 2013 subsequent event footnotes to the financial statements have been updated accordingly to reflect the correct amount of borrowings from third party investors and a majority shareholder.
Comment #19:
| | 18. | Please show precisely how you arrived at each adjustment amount with a discussion of any significant assumptions and estimates used to arrive at the adjustment amounts. For example, it is not clear how you determined the pro forma cash adjustment of $7,369,549. Please disclose the facts and circumstances that resulted in this adjustment. |
Response #19:
The 8K/A Pro forma statements have been updated accordingly to reflect the correct cash adjustment of $6,829,549. This adjustment includes the following:
| | ● | Subsequent to June 30, 2013 GPEC borrowed $4,700,000 from the majority shareholder in the form of a convertible note, |
| | ● | Subsequent to June 30, 2013, GPEC borrowed $2,124,500 from third party private investors in the form of a convertible notes. |
| | ● | Subsequent to July 31, 2013, UTCH sold 5,049,113 shares of UTCH common stock to GPEC management for proceeds of $5,049 |
| | ● | From July 1, 2013 through September 16, 2013, GPEC modified $2,237,500 of its outstanding short term debt whereby the notes became convertible. |
As of June 30, 2013, GPEC modified $195,000 of its outstanding short term debt due to third party private investors whereby the notes became convertible and $2,100,000 from the majority shareholder in the form of convertible promissory notes.
We hereby acknowledge that:
| | ● | the Company is responsible for the adequacy and accuracy of the disclosure in all of its filings; |
| | ● | staff comments or changes to disclosure in response to staff comments do not foreclose the Commission from taking any action with respect to the filings; and |
| | ● | the Company may not assert staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States. |
| | Very truly yours, | |
| | | | |
| | By: | /s/ Dean L. Ledger | |
| | Name: | Dean L. Ledger | |
| | Title: | Chief Executive Officer | |
| Encl. | | | |
SCHEDULE A
| Weighted Average Shares & EPS- HISTORICAL |
| |
| 6/30/2013 |
| Global Photonic | | Year Ended 6/30/2013 |
| | | | | Total O/S | | | | 181 Days O/S | | | | |
| Balance @ | | 12/31/12 | | | 57,409,544 | | | | 181 | | | | 57,409,544 | |
| | | | | | | | | | | | | | | |
| Warrants Exercised | | | | | | | | | | | | | | |
| Charlie G. Carlson | | 1/3/2013 | | | 12,500 | | | | 178 | | | | 12,293 | |
| Charlie G. Carlson | | 1/3/2013 | | | 6,250 | | | | 178 | | | | 6,146 | |
| Terry R. Yormark, II | | 1/4/2013 | | | 50,000 | | | | 177 | | | | 48,895 | |
| Robert D. Hynes-coded as BOLTON | | 1/3/2013 | | | 12,500 | | | | 178 | | | | 12,293 | |
| Harvey T. Stoma | | 1/4/2013 | | | 25,000 | | | | 177 | | | | 24,448 | |
| Scott A. Davis | | 1/3/2013 | | | 4,000 | | | | 178 | | | | 3,934 | |
| Mazzuca | | 1/3/2013 | | | 4,500 | | | | 178 | | | | 4,425 | |
| Mazzuca | | 1/3/2013 | | | 3,000 | | | | 178 | | | | 2,950 | |
| Chrachol | | 2/7/2013 | | | 65,100 | | | | 143 | | | | 51,433 | |
| James Chemowski | | 1/11/2013 | | | 20,000 | | | | 170 | | | | 18,785 | |
| Jeni Bagnato | | 1/24/2013 | | | 12,500 | | | | 157 | | | | 10,843 | |
| Ronald Cacioppo | | 2/22/2013 | | | 85,000 | | | | 128 | | | | 60,110 | |
| | | | | | | | | | | | | | | |
| Common issued for additional interest- warrant holders | | | | | | | | | | | | | | |
| Allan B. Clionsky | | 5/20/2013 | | | 25,000 | | | | 41 | | | | 5,663 | |
| Meghana Bhatt | | 5/20/2013 | | | 50,000 | | | | 41 | | | | 11,326 | |
| David S. Haga | | 5/20/2013 | | | 50,000 | | | | 41 | | | | 11,326 | |
| Redfield E. Bryan | | 5/20/2013 | | | 50,000 | | | | 41 | | | | 11,326 | |
| Clinton K. Stapp | | 5/20/2013 | | | 10,000 | | | | 41 | | | | 2,265 | |
| Sally Ginsburg and Michael Ginsburg | | 5/20/2013 | | | 25,000 | | | | 41 | | | | 5,663 | |
| Roger M. Smith | | 5/20/2013 | | | 50,000 | | | | 41 | | | | 11,326 | |
| Kristal M. Skrmetta | | 5/20/2013 | | | 50,000 | | | | 41 | | | | 11,326 | |
| Paul C. Skrmetta | | 5/20/2013 | | | 50,000 | | | | 41 | | | | 11,326 | |
| Rickey C. Ainsworth | | 5/20/2013 | | | 100,000 | | | | 41 | | | | 22,652 | |
| A & M Real Estate | | 5/20/2013 | | | 50,000 | | | | 41 | | | | 11,326 | |
| Robert D. Hynes | | 5/20/2013 | | | 12,500 | | | | 41 | | | | 2,831 | |
| Miss. GPE Holdings | | 5/20/2013 | | | 37,500 | | | | 41 | | | | 8,494 | |
| Carmelo Blacconeri and Nancy Blacconeri | | 5/20/2013 | | | 22,500 | | | | 41 | | | | 5,097 | |
| Thomas A. Holder | | 5/20/2013 | | | 14,000 | | | | 41 | | | | 3,171 | |
| | | | | | | | | | | | | | | |
| Common issued for services | | | | | | | | | | | | | | |
| Amy Kornafel | | 5/23/2013 | | | 1,550,000 | | | | 38 | | | | 325,414 | |
| Joey Stone | | 5/23/2013 | | | 1,747,200 | | | | 38 | | | | 366,815 | |
| Dean Ledger | | 5/23/2013 | | | 2,728,224 | | | | 38 | | | | 572,776 | |
| Stephen R. Forrest | | 5/23/2013 | | | 1,475,000 | | | | 38 | | | | 309,669 | |
| John D. Kuhns | | 5/23/2013 | | | 1,658,969 | | | | 38 | | | | 348,292 | |
| Robert J. Fasnacht | | 5/23/2013 | | | 2,625,000 | | | | 38 | | | | 551,105 | |
| David Wm. Boone | | 5/23/2013 | | | 1,200,000 | | | | 38 | | | | 251,934 | |
| Mark E. Thompson | | 5/23/2013 | | | 1,399,500 | | | | 38 | | | | 293,818 | |
| Anne B Spencer | | 5/20/2013 | | | 75,000 | | | | 41 | | | | 16,989 | |
| | | | | | | | | | | | | | | |
| Common issued for debt conversion | | | | | | | | | | | | | | |
| Chrachol | | 2/7/2013 | | | 30,000 | | | | 143 | | | | 23,702 | |
| The Burns partnership | | 3/15/2013 | | | 200,000 | | | | 107 | | | | 118,232 | |
| | | | | | | | | | | | | | | |
| Series B converted into Series A | | 1/1/2013 | | | 500,000 | | | | 180 | | | | 497,238 | |
| | | | | | | | | | | | | | | |
| Common issued to extend debt | | | | | | | | | | | | | | |
| Alfred Bracher | | 1/14/2013 | | | 250,000 | | | | 167 | | | | 230,663 | |
| Kasso | | 3/15/2013 | | | 25,000 | | | | 107 | | | | 14,779 | |
| Rene & Nancy Kern | | 3/15/2013 | | | 110,000 | | | | 107 | | | | 65,028 | |
| Kevin & Jessica Cummings | | 3/15/2013 | | | 220,000 | | | | 107 | | | | 130,055 | |
| David K. Cummings | | 3/15/2013 | | | 550,000 | | | | 107 | | | | 325,138 | |
| David P. Cummings | | 3/15/2013 | | | 165,000 | | | | 107 | | | | 97,541 | |
| Roger Pederson | | 3/15/2013 | | | 55,000 | | | | 107 | | | | 32,514 | |
| Matt Bolton | | 3/15/2013 | | | 2,500 | | | | 107 | | | | 1,478 | |
| Mason Braugh | | 5/20/2013 | | | 2,500 | | | | 41 | | | | 566 | |
| Dennis Giannageli | | 3/15/2013 | | | 50,000 | | | | 107 | | | | 29,558 | |
| | | | | | | | | | | | | | | |
| Common issued for additional interest- debt holders | | | | | | | | | | | | | | |
| David A. Burns | | 5/20/2013 | | | 57,720 | | | | 41 | | | | 13,075 | |
| Michael W. Burns | | 5/20/2013 | | | 57,720 | | | | 41 | | | | 13,075 | |
| Jeffrey S. Burns | | 5/20/2013 | | | 57,720 | | | | 41 | | | | 13,075 | |
| Jonathan L. Kasso and Susan Marek Kasso | | 5/20/2013 | | | 57,600 | | | | 41 | | | | 13,048 | |
| Mason Brugh | | 5/20/2013 | | | 25,000 | | | | 41 | | | | 5,663 | |
| Norman R. Crain | | 5/20/2013 | | | 12,500 | | | | 41 | | | | 2,831 | |
| Mark D. Cheairs | | 5/20/2013 | | | 50,000 | | | | 41 | | | | 11,326 | |
| Thomas P. Perone | | 5/20/2013 | | | 50,000 | | | | 41 | | | | 11,326 | |
| VHCO, LLC | | 5/20/2013 | | | 50,000 | | | | 41 | | | | 11,326 | |
| Neil Rooklin | | 5/20/2013 | | | 5,000 | | | | 41 | | | | 1,133 | |
| Scott A. Davis | | 5/20/2013 | | | 8,000 | | | | 41 | | | | 1,812 | |
| Charlie G. Carlson | | 5/20/2013 | | | 25,000 | | | | 41 | | | | 5,663 | |
| Matthew C. Bolton and Karen S. Bolton | | 5/20/2013 | | | 25,000 | | | | 41 | | | | 5,663 | |
| Harvey T. Stoma | | 5/20/2013 | | | 50,000 | | | | 41 | | | | 11,326 | |
| Anthony R. Rooklin | | 5/20/2013 | | | 4,000 | | | | 41 | | | | 906 | |
| James Chelmowski and Diane Chelmowski | | 5/20/2013 | | | 20,000 | | | | 41 | | | | 4,530 | |
| Jeni S. Bagnato | | 5/20/2013 | | | 12,500 | | | | 41 | | | | 2,831 | |
| The Burns Partnership, LLC | | 5/20/2013 | | | 200,000 | | | | 41 | | | | 45,304 | |
| Alfred F. Bracher, III | | 6/5/2013 | | | 100,000 | | | | 25 | | | | 13,812 | |
| | | | | | | | | | | | | | | |
| Common issued for additional interest-Default loan terms | | | | | | | | | | | | | | |
| George R. LaPlante and Barbara E. LaPlante | | 4/23/2013 | | | 1,000,000 | | | | 68 | | | | 375,691 | |
| George R. LaPlante and Barbara E. LaPlante | | 5/20/2013 | | | 800,000 | | | | 41 | | | | 181,215 | |
| Balance @ | | 06/30/13 | | | 77,593,047 | | | | | | | | 63,149,151 | |
| | | | | | | | | | | | | | | |
| | | Net Loss for the Year Ended 6/30/13 | | | | (27,628,017 | ) |
| | | Net Loss Per Share (basic and diluted) | | | | (0.44 | ) |
| Weighted Average Shares & EPS- PRO FORMA | | | | | |
| |
| 6/30/2013 | 5 5 GPEC for 1 UTCH |
| Global Photonic | Year Ended 6/30/2013 |
| | | | | | | | | | | | | | |
| | | | Total O/S | | | | | | | 181 Days O/S | | | | |
| Balance @ | 12/31/12 | | | 57,409,544 | | | | 15,991,909 | | | | 181 | | | | 15,991,909 | |
| | | | | | | | | | | | | | | | | | |
| Warrants Exercised | | | | | | | | | | | | | | | | | |
| Charlie G. Carlson | 1/3/2013 | | | 12,500 | | | | 2,500 | | | | 178 | | | | 2,459 | |
| Charlie G. Carlson | 1/3/2013 | | | 6,250 | | | | 1,250 | | | | 178 | | | | 1,229 | |
| Terry R. Yormark, II | 1/4/2013 | | | 50,000 | | | | 10,000 | | | | 177 | | | | 9,779 | |
| Robert D. Hynes-coded as BOLTON | 1/3/2013 | | | 12,500 | | | | 2,500 | | | | 178 | | | | 2,459 | |
| Harvey T. Stoma | 1/4/2013 | | | 25,000 | | | | 5,000 | | | | 177 | | | | 4,890 | |
| Scott A. Davis | 1/3/2013 | | | 4,000 | | | | 800 | | | | 178 | | | | 787 | |
| Mazzuca | 1/3/2013 | | | 4,500 | | | | 900 | | | | 178 | | | | 885 | |
| Mazzuca | 1/3/2013 | | | 3,000 | | | | 600 | | | | 178 | | | | 590 | |
| Chrachol | 2/7/2013 | | | 65,100 | | | | 13,020 | | | | 143 | | | | 10,287 | |
| James Chemowski | 1/11/2013 | | | 20,000 | | | | 4,000 | | | | 170 | | | | 3,757 | |
| Jeni Bagnato | 1/24/2013 | | | 12,500 | | | | 2,500 | | | | 157 | | | | 2,169 | |
| Ronald Cacioppo | 2/22/2013 | | | 85,000 | | | | 17,000 | | | | 128 | | | | 12,022 | |
| | | | | | | | | | | | | | | | | | |
| Common issued for additional interest- warrant holders | | | | | | | | | | | | | | | | | |
| Allan B. Clionsky | 5/20/2013 | | | 25,000 | | | | 5,000 | | | | 41 | | | | 1,133 | |
| Meghana Bhatt | 5/20/2013 | | | 50,000 | | | | 10,000 | | | | 41 | | | | 2,265 | |
| David S. Haga | 5/20/2013 | | | 50,000 | | | | 10,000 | | | | 41 | | | | 2,265 | |
| Redfield E. Bryan | 5/20/2013 | | | 50,000 | | | | 10,000 | | | | 41 | | | | 2,265 | |
| Clinton K. Stapp | 5/20/2013 | | | 10,000 | | | | 2,000 | | | | 41 | | | | 453 | |
| Sally Ginsburg and Michael Ginsburg | 5/20/2013 | | | 25,000 | | | | 5,000 | | | | 41 | | | | 1,133 | |
| Roger M. Smith | 5/20/2013 | | | 50,000 | | | | 10,000 | | | | 41 | | | | 2,265 | |
| Kristal M. Skrmetta | 5/20/2013 | | | 50,000 | | | | 10,000 | | | | 41 | | | | 2,265 | |
| Paul C. Skrmetta | 5/20/2013 | | | 50,000 | | | | 10,000 | | | | 41 | | | | 2,265 | |
| Rickey C. Ainsworth | 5/20/2013 | | | 100,000 | | | | 20,000 | | | | 41 | | | | 4,530 | |
| A & M Real Estate | 5/20/2013 | | | 50,000 | | | | 10,000 | | | | 41 | | | | 2,265 | |
| Robert D. Hynes | 5/20/2013 | | | 12,500 | | | | 2,500 | | | | 41 | | | | 566 | |
| Miss. GPE Holdings | 5/20/2013 | | | 37,500 | | | | 7,500 | | | | 41 | | | | 1,699 | |
| Carmelo Blacconeri and Nancy Blacconeri | 5/20/2013 | | | 22,500 | | | | 4,500 | | | | 41 | | | | 1,019 | |
| Thomas A. Holder | 5/20/2013 | | | 14,000 | | | | 2,800 | | | | 41 | | | | 634 | |
| | | | | | | | | | | | | | | | | | |
| Common issued for services | | | | | | | | | | | | | | | | | |
| Amy Kornafel | 5/23/2013 | | | 1,550,000 | | | | 310,000 | | | | 38 | | | | 65,083 | |
| Joey Stone | 5/23/2013 | | | 1,747,200 | | | | 349,440 | | | | 38 | | | | 73,363 | |
| Dean Ledger | 5/23/2013 | | | 2,728,224 | | | | 545,645 | | | | 38 | | | | 114,555 | |
| Stephen R. Forrest | 5/23/2013 | | | 1,475,000 | | | | 295,000 | | | | 38 | | | | 61,934 | |
| John D. Kuhns | 5/23/2013 | | | 1,658,969 | | | | 331,794 | | | | 38 | | | | 69,658 | |
| Robert J. Fasnacht | 5/23/2013 | | | 2,625,000 | | | | 525,000 | | | | 38 | | | | 110,221 | |
| David Wm. Boone | 5/23/2013 | | | 1,200,000 | | | | 240,000 | | | | 38 | | | | 50,387 | |
| Mark E. Thompson | 5/23/2013 | | | 1,399,500 | | | | 279,900 | | | | 38 | | | | 58,764 | |
| Anne B Spencer | 5/20/2013 | | | 75,000 | | | | 15,000 | | | | 41 | | | | 3,398 | |
| | | | | | | | | | | | | | | | | | |
| Common issued for debt conversion | | | | | | | | | | | | | | | | | |
| Chrachol | 2/7/2013 | | | 30,000 | | | | 6,000 | | | | 143 | | | | 4,740 | |
| The Burns partnership | 3/15/2013 | | | 200,000 | | | | 40,000 | | | | 107 | | | | 23,646 | |
| | | | | | | | | | | | | | | | | | |
| Series B converted into Series A | 1/1/2013 | | | 500,000 | | | | 100,000 | | | | 180 | | | | 99,448 | |
| | | | | | | | | | | | | | | | | | |
| Common issued to extend debt | | | | | | | | | | | | | | | | | |
| Alfred Bracher | 1/14/2013 | | | 250,000 | | | | 50,000 | | | | 167 | | | | 46,133 | |
| Kasso | 3/15/2013 | | | 25,000 | | | | 5,000 | | | | 107 | | | | 2,956 | |
| Rene & Nancy Kern | 3/15/2013 | | | 110,000 | | | | 22,000 | | | | 107 | | | | 13,006 | |
| Kevin & Jessica Cummings | 3/15/2013 | | | 220,000 | | | | 44,000 | | | | 107 | | | | 26,011 | |
| David K. Cummings | 3/15/2013 | | | 550,000 | | | | 110,000 | | | | 107 | | | | 65,028 | |
| David P. Cummings | 3/15/2013 | | | 165,000 | | | | 33,000 | | | | 107 | | | | 19,508 | |
| Roger Pederson | 3/15/2013 | | | 55,000 | | | | 11,000 | | | | 107 | | | | 6,503 | |
| Matt Bolton | 3/15/2013 | | | 2,500 | | | | 500 | | | | 107 | | | | 296 | |
| Mason Braugh | 5/20/2013 | | | 2,500 | | | | 500 | | | | 41 | | | | 113 | |
| Dennis Giannageli | 3/15/2013 | | | 50,000 | | | | 10,000 | | | | 107 | | | | 5,912 | |
| | | | | | | | | | | | | | | | | | |
| Common issued for additional interest- debt holders | | | | | | | | | | | | | | | | | |
| David A. Burns | 5/20/2013 | | | 57,720 | | | | 11,544 | | | | 41 | | | | 2,615 | |
| Michael W. Burns | 5/20/2013 | | | 57,720 | | | | 11,544 | | | | 41 | | | | 2,615 | |
| Jeffrey S. Burns | 5/20/2013 | | | 57,720 | | | | 11,544 | | | | 41 | | | | 2,615 | |
| Jonathan L. Kasso and Susan Marek Kasso | 5/20/2013 | | | 57,600 | | | | 11,520 | | | | 41 | | | | 2,610 | |
| Mason Brugh | 5/20/2013 | | | 25,000 | | | | 5,000 | | | | 41 | | | | 1,133 | |
| Norman R. Crain | 5/20/2013 | | | 12,500 | | | | 2,500 | | | | 41 | | | | 566 | |
| Mark D. Cheairs | 5/20/2013 | | | 50,000 | | | | 10,000 | | | | 41 | | | | 2,265 | |
| Thomas P. Perone | 5/20/2013 | | | 50,000 | | | | 10,000 | | | | 41 | | | | 2,265 | |
| VHCO, LLC | 5/20/2013 | | | 50,000 | | | | 10,000 | | | | 41 | | | | 2,265 | |
| Neil Rooklin | 5/20/2013 | | | 5,000 | | | | 1,000 | | | | 41 | | | | 227 | |
| Scott A. Davis | 5/20/2013 | | | 8,000 | | | | 1,600 | | | | 41 | | | | 362 | |
| Charlie G. Carlson | 5/20/2013 | | | 25,000 | | | | 5,000 | | | | 41 | | | | 1,133 | |
| Matthew C. Bolton and Karen S. Bolton | 5/20/2013 | | | 25,000 | | | | 5,000 | | | | 41 | | | | 1,133 | |
| Harvey T. Stoma | 5/20/2013 | | | 50,000 | | | | 10,000 | | | | 41 | | | | 2,265 | |
| Anthony R. Rooklin | 5/20/2013 | | | 4,000 | | | | 800 | | | | 41 | | | | 181 | |
| James Chelmowski and Diane Chelmowski | 5/20/2013 | | | 20,000 | | | | 4,000 | | | | 41 | | | | 906 | |
| Jeni S. Bagnato | 5/20/2013 | | | 12,500 | | | | 2,500 | | | | 41 | | | | 566 | |
| The Burns Partnership, LLC | 5/20/2013 | | | 200,000 | | | | 40,000 | | | | 41 | | | | 9,061 | |
| Alfred F. Bracher, III | 6/5/2013 | | | 100,000 | | | | 20,000 | | | | 25 | | | | 2,762 | |
| | | | | | | | | | | | | | | | | | |
| Common issued for additional interest-Default loan terms | | | | | | | | | | | | | | | | | |
| George R. LaPlante and Barbara E. LaPlante | 4/23/2013 | | | 1,000,000 | | | | 200,000 | | | | 68 | | | | 75,138 | |
| George R. LaPlante and Barbara E. LaPlante | 5/20/2013 | | | 800,000 | | | | 160,000 | | | | 41 | | | | 36,243 | |
| | | | | | | | | | | | | | | | | | |
| Unreconciled shares- premerger | 1/1/2013 | | | (398,715 | ) | | | (79,743 | ) | | | 180 | | | | (79,302 | ) |
| RP- Common stock issued for the conversion of the GPEC preferred shares 1100 | 1/1/2013 | | | | | | | 1,155,000 | | | | 180 | | | | 1,148,619 | |
| Common stock issued for the conversion of the GPEC preferred shares 105 | 1/1/2013 | | | | | | | 115,500 | | | | 180 | | | | 114,862 | |
| UTCH shares 14,400,000 reflects the 1.20 forward split on 12M shares | 1/1/2013 | | | | | | | 14,400,000 | | | | 180 | | | | 14,320,442 | |
| Shares sold for cash UTCH post split | 1/1/2013 | | | | | | | 6,058,936 | | | | 180 | | | | 6,025,461 | |
| UTCH 9M shares cancelled post split | 1/1/2013 | | | | | | | (10,800,000 | ) | | | 180 | | | | (10,740,331 | ) |
| Shares issued for the conversion debt due to merger | 1/1/2013 | | | | | | | 11,357,000 | | | | 180 | | | | 11,294,254 | |
| Balance @ | 06/30/13 | | | 77,194,332 | | | | 42,235,302 | | | | | | | | 39,223,834 | |
| | | | | | | | | | | | | | | | | | |
| Due to Merger shown o/s as of the first day of the period | | | | | | | | | | | | | | | | | |
| | Net loss of the period end 6/30/13 | | | | (27,640,080 | ) |
| | Net Loss Per Share (basic and diluted) | | | | (0.70 | ) |
