Business Description

NOTE 1. BASIS OF PRESENTATION Description of Business We develop and sell devices that use spintronics, a nanotechnology that relies on electron spin rather than electron charge to acquire, store, and transmit information. Segment Reporting In accordance with ASC 280, Segment Reporting , operating segments are determined based on the information provided to the Chief Operating Decision Maker (CODM) on a regular basis and used for the purpose of assessing performance and allocating resources within the company. Our CEO is deemed to be our CODM since he makes all major decisions on how to allocate the resources and assess the performance for strategic and operational initiatives. The CODM is regularly provided with and reviews revenue and gross margin information by revenue categories, product categories, and operating expenses by category to assess performance and allocate resources. ASC 280 indicates that a component is an operating segment if it meets the following criteria: · It engages in business activities from which it may earn revenues and incur expenses. · Its operating results are regularly reviewed by the CODM to make decisions about resources to be allocated to the segment and assess its performance. · Its discrete financial information is available. We analyze revenues and assess sales performance in various categories but we do not prepare or analyze discrete financial information such as sales expenses, operating results, or profit and loss itemized by category. Therefore, we have concluded that the Company as a whole is a single operating and reportable segment under ASC 280, Segment Reporting .