throughout this annual report , each instance which refers to a number of shares of our common stock , refers to the number of shares of common stock after giving effect to the reverse split , unless otherwise indicated . private placement on may 31 , 2013 , we sold an aggregate of 1,153,844 units representing gross proceeds of $ 6,000,000 to certain accredited investors pursuant to a securities purchase agreement , among which , 999,998 units representing $ 5,200,000 were funded . each unit was subscribed for a purchase price of $ 5.20 per unit and consists of : ( i ) one share of our common stock , and ( ii ) a three ( 3 ) year warrant to purchase one half share of our common stock at an exercise price of $ 6.50 per share , subject to adjustment upon the occurrence of certain events such as stock splits and stock dividends and similar events . the warrants contain limitations on the holders ' ability to exercise the warrants in the event such exercise causes the holder to beneficially own in excess of 9.99 % of our issued and outstanding common stock . the company paid placement agent fees of $ 170,000 to two broker-dealers in connection with the sale of the units of which $ 30,000 was previously paid by us as a retainer . on july 29 , 2013 , we converted legal fees of $ 29,620 into 5,696 units . in august 2013 , two investors who had subscribed for an aggregate of 153,846 units for an aggregate purchase price of $ 800,000 on may 31 , 2013 assigned their subscriptions to other investors . such other investors each funded their subscriptions and such additional units were issued . additionally , we paid placement agent fees of $ 35,029 and legal fees of $ 42,375 in connection with the sale of units . -21- cyberfone acquisition on april 22 , 2013 , cyberfone acquisition corp. ( “ cyberfone acquisition corp. ” ) , a texas corporation and our newly formed wholly owned subsidiary entered into a merger agreement ( the “ cyberfone merger agreement ” ) with cyberfone systems llc , a texas limited liability company ( “ cyberfone systems ” ) , techdev holdings llc ( “ techdev ” ) and the spangenberg family foundation for the benefit of children 's healthcare and education ( “ spangenberg foundation ” ) . techdev and spangenberg foundation owned 100 % of the membership interests of cyberfone systems ( collectively , the ‘ cyberfone sellers ” ) . cyberfone systems owns a foundational patent portfolio that includes claims that provide specific transactional data processing , telecommunications , network and database inventions , including financial transactions . the portfolio , which has a large and established licensing base , consists of ten united states patents and 27 foreign patents and one patent application . the patent rights that cover digital communications and data transaction processing are foundational to certain applications in the wireless , telecommunications , financial and other industries . ip nav , a company founded by erich spangenberg and associated with the cyberfone sellers will continue to support and manage the portfolio of patents and retain a contingent participation interest in all recoveries . ip nav provides patent monetization and support services under an existing agreement with cyberfone systems . pursuant to the terms of the cyberfone merger agreement , cyberfone systems merged with and into cyberfone acquisition corp with cyberfone systems surviving the merger as our wholly owned subsidiary . we ( i ) issued 461,538 post-split ( 6,000,000 pre-split ) shares of common stock to the cyberfone sellers , ( ii ) paid the cyberfone sellers $ 500,000 cash and ( iii ) issued a $ 500,000 promissory note to techdev ( the “ note ” ) . on june 21 , 2013 , we paid $ 500,000 to techdev in satisfaction of the note . patent acquisitions on april 16 , 2013 , the company through its subsidiary , relay ip , inc. acquired a us patent for $ 350,000. on june 4 , 2013 , in connection with the closing of a settlement and license agreement , the company agreed to settle and release a certain defendant for past and future use of the company 's patents . the defendant agreed to assign and transfer 3 us patents and rights valued at $ 1,000,000 in lieu of an additional cash payment , which amount has been included in the company 's revenue during the year ended december 31 , 2013. in september 2013 , the company acquired 14 us patents for a total purchase price of $ 1,100,000. on november 13 , 2013 , the company acquired four patents for 150,000 shares of the company 's common stock , which the company valued at $ 718,500 based on the fair market value of the stock issued . on december 16 , 2013 , the company acquired certain patents from delphi technologies , inc. for $ 1,700,000 pursuant to a patent purchase agreement entered into on october 31 , 2013 and amended on december 16 , 2013. on december 22 , 2013 , in connection with a settlement and license agreement , the company agreed to settle and release another defendant for past and future use of the company 's patents , whereby the defendant agreed to assign and transfer 2 u.s. patents and rights to the company . story_separator_special_tag the increase resulted from the company generating revenue in the patent monetization business that was entered into in late 2012 and therefore did not generate revenue in that year . the $ 3,418,371 in revenue in 2013 is comprised of cash based revenue of $ 1,718,371 and non-cash revenue of $ 1,700,000. the non-cash revenue is the value of patents acquired by the company in lieu of cash in two transactions that closed during the year . direct costs of revenue . direct costs of revenue increased by $ 957,040 in the year ended december 31 , 2013 compared to no direct costs of revenue in the prior year . direct costs of revenue include contingent payments to patent enforcement legal costs , patent enforcement advisors and inventors . direct costs of revenue also includes various non-contingent costs associated with enforcing the company 's patent rights and otherwise in developing and entering into settlement and licensing agreements that generate the company 's revenue . such costs include other legal fees and expenses , consulting fees , data management costs and other costs . amortization of patents . amortization of patents increased by $ 1,029,372 to $ 1,038,505 in the year ended december 31 , 2013 from $ 8,773 in the comparable year 2012. when the company acquires patents and patent rights , the company capitalizes those assets and amortizes the costs over the remaining useful lives of the assets . the increase for the year ended december 31 , 2013 over 2012 primarily reflects the amortization of patent assets acquired by the company during that year . in 2012 , only one patent portfolio was acquired . -25- compensation and related taxes . compensation expense increased by $ 320,591 to $ 2,997,053 in the year ended december 31 , 2013 compared to $ 2,676,462 in the prior year . compensation expense includes cash compensation and related payroll taxes and benefits , and also non-cash compensation . the increase in total compensation costs for the year ended december 31 , 2013 reflected an increase in the cash compensation of $ 1,273,296 , which increase was largely offset by a reduction in non-cash compensation of $ 952,705 in the year ended december 31 , 2013 compared to the prior year . the increase in cash compensation primarily reflects an increase in headcount to six in the year ended december 31 , 2013 from two in the prior year . the reduction in non-cash compensation reflects a lower level of non-cash compensation for employees in 2013 from that in the prior year , which had included a higher level of non-cash compensation for executives who have since terminated . non-cash compensation for the years ended december 31 , 2013 and 2012 was $ 1,493,512 and $ 2,446,217 respectively . consulting fees . consulting fees decreased by $ 1,140,458 to $ 901,686 for the year ended december 31 , 2013 compared to $ 2,042,144 in the year ended december 31 , 2012. consulting fees include both cash and non-cash related consulting fees primarily for investor relations and public relations services but also for other consulting services . the decrease in consulting fees in the year ended december 31 , 2013 compared to the prior year was due entirely to a decrease in non-cash consulting fees . non-cash consulting fees for the years ended december 31 , 2013 and 2012 were $ 613,303 and $ 1,791,882 respectively . professional fees . professional fees increased by $ 145,090 to $ 655,202 in the year ended december 31 , 2013 compared to $ 510,112 in the year ended december , 31 , 2012. professional fees primarily reflect the costs of professional outside accounting fees , legal fees and audit fees . the increase in professional fees for the year ended december 31 , 2013 over that of the prior year are predominately related to professional outside accounting fees and audit fees resulting from a substantially higher level of activity in the company 's continuing patent acquisition and monetization operations and also a higher level of activity as a public company . for the year ended december 31 , 2013 and 2012 , professional fees included stock based compensation of $ 59,620 and $ 198,287 respectively . general and administrative . general and administrative expenses increased by $ 240,867 to $ 544,338 in the year ended december 31 , 2013 compared to $ 303,471 in the prior year . general and administrative expenses reflect the other operating costs of the company and include travel , certain public relations costs and other expenses related to being a public company , rent and other expenses incurred to support the operations of the company . the increase in general and administrative costs in the year ended december 31 , 2013 over those of the prior year resulted from increased rent , internet access , telephone and other operating expenses during the year ended december 31 , 2013 over that of the prior year . operating loss from continuing operations . the operating loss from continuing operations decreased by $ 1,865,509 to $ 3,675,453 in 2013 from $ 5,540,962 in 2012 as a result of the increase in revenue during 2013 , which more than off-setting the increase in operating expenses in 2013 over that of 2012. other income ( expenses ) . other income ( expenses ) decreased by $ 125,000 to zero in 2013 from $ 125,000 in 2012. the other income in 2012 was a non-recurring consulting fee received by the company that was not related to the company 's continuing business activities . realized loss other than temporary decline – marketable securities available for sale . the realized loss in this category decreased by $ 73,681 in 2013 to $ 38,819 from $ 112,500 in 2012 , reflecting a lower level of sales of marketable securities due in part to a lower level of company investment in marketable securities available for sale during 2013. the lower level of

liquidity and capital resources at december 31 , 2013 , the company 's cash and cash equivalents balances totaled $ 3,610,262 compared to $ 2,354,169 at december 31 , 2012. the increase in the cash balances of $ 1,256,093 resulted primarily from cash received during the year from cash based revenue recorded in the year plus the net funds from financings exceeding the increase in cash operating expenses for the year . other balance sheet changes also contributed to the change in cash . during the year ended december 31 , 2013 , the company raised net proceeds of $ 5,777,596 from the sale of equity securities in a private placement . net working capital increased by $ 1,452,509 to $ 3,853,834 at december 31 , 2013 from $ 2,401,325 at december 31 , 2012. the increase in net working capital resulted primarily from the aggregate increase in cash receipts from cash based revenue plus net proceeds of financing plus an increase in net accounts receivable of $ 270,000 plus an increase in prepaid expenses of $ 712,598 more than off-setting an increase in accounts payable and accruals of $ 697,787 . -27- cash used in operating activities increased by $ 258,066 to $ 1,519,470 in the year ended december 31 , 2013 from $ 1,261,404 in the prior year .


 Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.
     ```liquidity and capital resources at december 31 , 2013 , the company 's cash and cash equivalents balances totaled $ 3,610,262 compared to $ 2,354,169 at december 31 , 2012. the increase in the cash balances of $ 1,256,093 resulted primarily from cash received during the year from cash based revenue recorded in the year plus the net funds from financings exceeding the increase in cash operating expenses for the year . other balance sheet changes also contributed to the change in cash . during the year ended december 31 , 2013 , the company raised net proceeds of $ 5,777,596 from the sale of equity securities in a private placement . net working capital increased by $ 1,452,509 to $ 3,853,834 at december 31 , 2013 from $ 2,401,325 at december 31 , 2012. the increase in net working capital resulted primarily from the aggregate increase in cash receipts from cash based revenue plus net proceeds of financing plus an increase in net accounts receivable of $ 270,000 plus an increase in prepaid expenses of $ 712,598 more than off-setting an increase in accounts payable and accruals of $ 697,787 . -27- cash used in operating activities increased by $ 258,066 to $ 1,519,470 in the year ended december 31 , 2013 from $ 1,261,404 in the prior year .
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 Suspicious Activity Report : throughout this annual report , each instance which refers to a number of shares of our common stock , refers to the number of shares of common stock after giving effect to the reverse split , unless otherwise indicated . private placement on may 31 , 2013 , we sold an aggregate of 1,153,844 units representing gross proceeds of $ 6,000,000 to certain accredited investors pursuant to a securities purchase agreement , among which , 999,998 units representing $ 5,200,000 were funded . each unit was subscribed for a purchase price of $ 5.20 per unit and consists of : ( i ) one share of our common stock , and ( ii ) a three ( 3 ) year warrant to purchase one half share of our common stock at an exercise price of $ 6.50 per share , subject to adjustment upon the occurrence of certain events such as stock splits and stock dividends and similar events . the warrants contain limitations on the holders ' ability to exercise the warrants in the event such exercise causes the holder to beneficially own in excess of 9.99 % of our issued and outstanding common stock . the company paid placement agent fees of $ 170,000 to two broker-dealers in connection with the sale of the units of which $ 30,000 was previously paid by us as a retainer . on july 29 , 2013 , we converted legal fees of $ 29,620 into 5,696 units . in august 2013 , two investors who had subscribed for an aggregate of 153,846 units for an aggregate purchase price of $ 800,000 on may 31 , 2013 assigned their subscriptions to other investors . such other investors each funded their subscriptions and such additional units were issued . additionally , we paid placement agent fees of $ 35,029 and legal fees of $ 42,375 in connection with the sale of units . -21- cyberfone acquisition on april 22 , 2013 , cyberfone acquisition corp. ( “ cyberfone acquisition corp. ” ) , a texas corporation and our newly formed wholly owned subsidiary entered into a merger agreement ( the “ cyberfone merger agreement ” ) with cyberfone systems llc , a texas limited liability company ( “ cyberfone systems ” ) , techdev holdings llc ( “ techdev ” ) and the spangenberg family foundation for the benefit of children 's healthcare and education ( “ spangenberg foundation ” ) . techdev and spangenberg foundation owned 100 % of the membership interests of cyberfone systems ( collectively , the ‘ cyberfone sellers ” ) . cyberfone systems owns a foundational patent portfolio that includes claims that provide specific transactional data processing , telecommunications , network and database inventions , including financial transactions . the portfolio , which has a large and established licensing base , consists of ten united states patents and 27 foreign patents and one patent application . the patent rights that cover digital communications and data transaction processing are foundational to certain applications in the wireless , telecommunications , financial and other industries . ip nav , a company founded by erich spangenberg and associated with the cyberfone sellers will continue to support and manage the portfolio of patents and retain a contingent participation interest in all recoveries . ip nav provides patent monetization and support services under an existing agreement with cyberfone systems . pursuant to the terms of the cyberfone merger agreement , cyberfone systems merged with and into cyberfone acquisition corp with cyberfone systems surviving the merger as our wholly owned subsidiary . we ( i ) issued 461,538 post-split ( 6,000,000 pre-split ) shares of common stock to the cyberfone sellers , ( ii ) paid the cyberfone sellers $ 500,000 cash and ( iii ) issued a $ 500,000 promissory note to techdev ( the “ note ” ) . on june 21 , 2013 , we paid $ 500,000 to techdev in satisfaction of the note . patent acquisitions on april 16 , 2013 , the company through its subsidiary , relay ip , inc. acquired a us patent for $ 350,000. on june 4 , 2013 , in connection with the closing of a settlement and license agreement , the company agreed to settle and release a certain defendant for past and future use of the company 's patents . the defendant agreed to assign and transfer 3 us patents and rights valued at $ 1,000,000 in lieu of an additional cash payment , which amount has been included in the company 's revenue during the year ended december 31 , 2013. in september 2013 , the company acquired 14 us patents for a total purchase price of $ 1,100,000. on november 13 , 2013 , the company acquired four patents for 150,000 shares of the company 's common stock , which the company valued at $ 718,500 based on the fair market value of the stock issued . on december 16 , 2013 , the company acquired certain patents from delphi technologies , inc. for $ 1,700,000 pursuant to a patent purchase agreement entered into on october 31 , 2013 and amended on december 16 , 2013. on december 22 , 2013 , in connection with a settlement and license agreement , the company agreed to settle and release another defendant for past and future use of the company 's patents , whereby the defendant agreed to assign and transfer 2 u.s. patents and rights to the company . story_separator_special_tag the increase resulted from the company generating revenue in the patent monetization business that was entered into in late 2012 and therefore did not generate revenue in that year . the $ 3,418,371 in revenue in 2013 is comprised of cash based revenue of $ 1,718,371 and non-cash revenue of $ 1,700,000. the non-cash revenue is the value of patents acquired by the company in lieu of cash in two transactions that closed during the year . direct costs of revenue . direct costs of revenue increased by $ 957,040 in the year ended december 31 , 2013 compared to no direct costs of revenue in the prior year . direct costs of revenue include contingent payments to patent enforcement legal costs , patent enforcement advisors and inventors . direct costs of revenue also includes various non-contingent costs associated with enforcing the company 's patent rights and otherwise in developing and entering into settlement and licensing agreements that generate the company 's revenue . such costs include other legal fees and expenses , consulting fees , data management costs and other costs . amortization of patents . amortization of patents increased by $ 1,029,372 to $ 1,038,505 in the year ended december 31 , 2013 from $ 8,773 in the comparable year 2012. when the company acquires patents and patent rights , the company capitalizes those assets and amortizes the costs over the remaining useful lives of the assets . the increase for the year ended december 31 , 2013 over 2012 primarily reflects the amortization of patent assets acquired by the company during that year . in 2012 , only one patent portfolio was acquired . -25- compensation and related taxes . compensation expense increased by $ 320,591 to $ 2,997,053 in the year ended december 31 , 2013 compared to $ 2,676,462 in the prior year . compensation expense includes cash compensation and related payroll taxes and benefits , and also non-cash compensation . the increase in total compensation costs for the year ended december 31 , 2013 reflected an increase in the cash compensation of $ 1,273,296 , which increase was largely offset by a reduction in non-cash compensation of $ 952,705 in the year ended december 31 , 2013 compared to the prior year . the increase in cash compensation primarily reflects an increase in headcount to six in the year ended december 31 , 2013 from two in the prior year . the reduction in non-cash compensation reflects a lower level of non-cash compensation for employees in 2013 from that in the prior year , which had included a higher level of non-cash compensation for executives who have since terminated . non-cash compensation for the years ended december 31 , 2013 and 2012 was $ 1,493,512 and $ 2,446,217 respectively . consulting fees . consulting fees decreased by $ 1,140,458 to $ 901,686 for the year ended december 31 , 2013 compared to $ 2,042,144 in the year ended december 31 , 2012. consulting fees include both cash and non-cash related consulting fees primarily for investor relations and public relations services but also for other consulting services . the decrease in consulting fees in the year ended december 31 , 2013 compared to the prior year was due entirely to a decrease in non-cash consulting fees . non-cash consulting fees for the years ended december 31 , 2013 and 2012 were $ 613,303 and $ 1,791,882 respectively . professional fees . professional fees increased by $ 145,090 to $ 655,202 in the year ended december 31 , 2013 compared to $ 510,112 in the year ended december , 31 , 2012. professional fees primarily reflect the costs of professional outside accounting fees , legal fees and audit fees . the increase in professional fees for the year ended december 31 , 2013 over that of the prior year are predominately related to professional outside accounting fees and audit fees resulting from a substantially higher level of activity in the company 's continuing patent acquisition and monetization operations and also a higher level of activity as a public company . for the year ended december 31 , 2013 and 2012 , professional fees included stock based compensation of $ 59,620 and $ 198,287 respectively . general and administrative . general and administrative expenses increased by $ 240,867 to $ 544,338 in the year ended december 31 , 2013 compared to $ 303,471 in the prior year . general and administrative expenses reflect the other operating costs of the company and include travel , certain public relations costs and other expenses related to being a public company , rent and other expenses incurred to support the operations of the company . the increase in general and administrative costs in the year ended december 31 , 2013 over those of the prior year resulted from increased rent , internet access , telephone and other operating expenses during the year ended december 31 , 2013 over that of the prior year . operating loss from continuing operations . the operating loss from continuing operations decreased by $ 1,865,509 to $ 3,675,453 in 2013 from $ 5,540,962 in 2012 as a result of the increase in revenue during 2013 , which more than off-setting the increase in operating expenses in 2013 over that of 2012. other income ( expenses ) . other income ( expenses ) decreased by $ 125,000 to zero in 2013 from $ 125,000 in 2012. the other income in 2012 was a non-recurring consulting fee received by the company that was not related to the company 's continuing business activities . realized loss other than temporary decline – marketable securities available for sale . the realized loss in this category decreased by $ 73,681 in 2013 to $ 38,819 from $ 112,500 in 2012 , reflecting a lower level of sales of marketable securities due in part to a lower level of company investment in marketable securities available for sale during 2013. the lower level of

