Quarterly report pursuant to Section 13 or 15(d)

CONDENSED CONSOLIDATED BALANCE SHEETS

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CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)
Jun. 30, 2015
Dec. 31, 2014
Current assets    
Cash and cash equivalents $ 958,063 $ 7,212,114
Accounts receivable 663,892 410,950
Inventory 6,382,078 5,784,905
Prepaid expenses and other assets 133,784 140,559
Total current assets 8,137,817 13,548,528
Property and Equipment, net 872,654 255,330
License, net 61,765 64,707
Prepaid expenses and other assets 8,929 13,799
Debt issuance costs, net 1,947,594 2,285,696
Customer acquisition costs 1,037,412 1,156,521
Total assets 12,066,171 17,324,581
Current liabilities    
Accounts payable and accrued expenses 410,902 688,730
Accrued legal and consulting fees 65,824 86,304
Accrued salaries and benefits 433,585 399,487
Deferred revenue 6,035,850 5,808,301
Convertible notes payable 1,247,719 3,080,376
Customer credits $ 936,500 936,500
Other Current liabilities   250,000
Total current liabilities $ 9,130,380 11,249,698
Convertible notes payable, net of discount 5,037,996 4,724,598
Warrant liability 4,280,282 5,597,011
Accrued interest 160,659 337,999
Total liabilities $ 18,609,317 $ 21,909,306
Stockholders' deficit    
Preferred stock, $.001 par value: 2,000,000 shares authorized    
Common stock; $.001 par value; 150,000,000 shares authorized; 45,591,412 shares issued and outstanding as of June 30, 2015 40,228,123 shares issued and outstanding as of December 31, 2014 $ 45,591 $ 40,228
Additional paid-in capital 23,118,107 19,113,724
Accumulated deficit (29,706,844) (23,738,677)
Total stockholders' deficit (6,543,146) (4,584,725)
Total liabilities and stockholders' deficit $ 12,066,171 $ 17,324,581