our notes and will be able to apply such unused funds to make up any shortfall we may have in the foregoing operating costs and to further develop HemoTech. On the other hand, if we are required to pay significantly more than approximately $39,000 of liquidation damages (more than $180,000 in total liquidated damages), our current available cash will not be sufficient to complete our immediate planned operations over the next eight to nine months and repay all of our outstanding 10% convertible promissory notes. In such case, we will be required to scale back significantly on the anticipated general and administrative costs set forth above, use proceeds that we receive upon exercise of our warrants, if any, or raise additional capital in the next eight to nine months in order to maintain our operations through the next eight to nine months. Assuming the excercise of all of the warrants, the total amount of proceeds we would receive is approximately $5.6 million, although there can be no assurance that any of our warrants will be exercised.

      Following completion of our U.S. IND application, and regardless of whether we are required to raise additional financing to make up any shortfall caused by our payment of liquidated damages to our selling stockholders and to repay our 10% convertible unsecured promissory notes, our planned operations will include submission of our U.S. IND application, commencement and completion of our Phase I U.S. clinical trials, continuation of our research and development of HemoTech during Phase I clinical trials, and payment of our operational and overhead costs that we will incur during our Phase I clinical trials. In order to complete these additional planned operations, we will need to raise an additional $10-15 million within the next eight to nine months. If we fail to generate enough working capital, either from future equity or debt sales or revenue from operations, there can be no assurance that we will be able to implement our business plan, complete these planned operations, or continue our operations beyond the next 12 months.

      We will have to fund our liquidity requirements through public or private equity offerings or debt financings. We may be unable to obtain any required additional financing on terms favorable to us, if at all. If adequate funds are not available on acceptable terms, we will be unable to fund our expansion, successfully promote our brand, develop our products and respond to competitive pressures or take advantage of acquisition opportunities, any of which would have a material adverse effect on our business. If we raise additional funds through the issuance of equity securities, our stockholders may experience dilution of their ownership interest, and the newly-issued securities may have rights superior to those of our common stock. If we raise additional funds by issuing debt, we may be subject to limitations on our operations, including limitations on the payment of dividends. There can be no assurances that we will be able to secure additional financing, or obtain favorable terms on such financing if it is available. Continued negative cash flows create substantial doubt about our ability to fully implement our operating plan and we may have to reduce the scope of our planned operations, which may jeopardize our ability to continue our business. If cash and cash equivalents, together with any cash generated from operations, are insufficient to satisfy our liquidity requirements, we will not have sufficient resources to continue operations.