Annual report pursuant to Section 13 and 15(d)

CONSOLIDATED STATEMENTS OF CASH FLOWS

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CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)
12 Months Ended
Oct. 31, 2017
Oct. 31, 2016
Cash flows from operating activities:    
Net loss $ (5,008,991) $ (5,016,428)
Stock option compensation to employees and consultants 1,222,772 873,561
Common stock issued to consultants and directors 486,424 31,360
Amortization of patents 325,296 325,296
Accretion of interest on patent acquisition obligations to interest expense 228,026 519,946
Common stock issued to acquire patent license 11,800
Depreciation and amortization of property and equipment 43,216 33,333
Loss on disposal of property and equipment 45,915
Gain on extinguishment of patent acquisition obligation (1,547,608)
Change in operating assets and liabilities:    
Prepaid expenses and other current assets (12,497) (35,541)
Accounts payable 107,100 (1,479)
Accrued expenses 313,637 89,470
Royalties and contingent legal fees payable (213,017)
Net cash used in operating activities (3,796,710) (3,381,699)
Cash flows from investing activities:    
Disbursements to acquire short-term investments in certificates of deposit (5,501,000) (1,900,000)
Proceeds from maturities of short-term investments in certificates of deposit 2,751,000 3,550,000
Proceeds from sale of property and equipment 45,000
Purchase of property and equipment (30,188) (146,521)
Net cash (used in) provided by investing activities (2,735,188) 1,503,479
Cash flows from financing activities:    
Proceeds from sale of common stock in shareholder rights offering 4,203,302
Proceeds from sale of common stock in registered direct offering 3,211,788
Proceeds from sale of common stock in at-the-market offering 3,460,586
Redemption of convertible preferred stock (500,000)
Payments made on secured debenture (3,000,000)
Proceeds from exercise of employee stock options 7,273 33,581
Royalty payment applied to patent acquisition obligation (36,257)
Net cash provided by (used in) financing activities 7,382,949 (2,676)
Net increase (decrease) in cash and cash equivalents 851,051 (1,880,896)
Cash and cash equivalents at beginning of year 2,488,323 4,369,219
Cash and cash equivalents at end of year 3,339,374 2,488,323
Supplemental cash flow information:    
Cash payments for interest 272,429
Supplemental disclosure of non-cash financing activities:    
Redemption of Series A convertible preferred stock into secured debenture (Note 5) 3,000,000
Common stock issued to pay patent acquisition obligation (Note 4) $ 2,852,294