Quarterly report pursuant to Section 13 or 15(d)

Consolidated Statements of Cash Flow (Unaudited)

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Consolidated Statements of Cash Flow (Unaudited) - USD ($)
6 Months Ended
Jun. 30, 2015
Jun. 30, 2014
Cash flows from operating activities:    
Net loss during the development stage $ (3,940,651) $ (3,173,035)
Adjustments to reconcile net loss from operations to cash used by operations:    
Depreciation 187,802 202,986
Stock based compensation 165,922 751,114
Interest expense on convertible debentures $ 23,777 $ 13,269
Amortized discount on convertible debentures    
Legal, consulting and investment services $ 168,873 $ 554,784
Interest expense paid in kind 247,500 $ 225,000
Inventory reserve 120,167  
Effects of changes in operating assets and liabilities:    
Prepaid expenses and deposits (34,848) $ (4,269)
Accounts payable 214,105 (142,901)
Accounts payable, related parties $ 26,195 (144,079)
Customer deposits   (177,500)
Net cash used by operations $ (2,821,158) $ (1,894,631)
Cash flows from investing activities:    
Capital expenditures (35,530)  
Net cash used by investing activities (35,530)  
Cash flows from financing activities:    
Proceeds from notes payable 460,000  
Payments on long-term debt (4,170) $ (320,212)
Conversion of note payable 392,000  
Shareholder advances, net of repayments 700,500 $ (1,928,300)
Issuance of common and preferred stock 1,027,031 5,942,300
Net cash provided by financing activities 2,575,361 3,693,788
Change in cash and cash equivalents (281,327) 1,799,157
Cash at the beginning of the period 442,257 7,019
Cash at the end of the period $ 160,931 $ 1,806,176