Quarterly report pursuant to Section 13 or 15(d)

Condensed Consolidated Statements of Cash Flows (Unaudited)

v3.5.0.2
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)
 6 Months Ended
Jun. 30, 2016
Jun. 30, 2015
Cash flows from operating activities:    
Net Loss $ (2,158,084) $ (2,230,320)
Adjustments to reconcile net income to net cash used in operating activities:    
Amortization of deferred financing costs 218,630
Forbearance incentive expense (1,023,112)
Depreciation expense 236,737 53,048
Amortization of original issue discount 109,345
Payment in kind interest-senior debt 162,663
Stock Incentive expense to investor 35,186
Stock incentive expense to employees 154,487
Changes in operating assets and liabilities:    
Accounts receivable (2,652,671) 479,622
Other current assets (288,406) (185,926)
Accrued lease termination costs (116,544)
Due to related party 85,399
Accounts payable and accrued liabilities 568,849 1,531,029
Accrued Litigation Costs (40,000)
Net cash (used in) provided by operating activities (3,613,263) 599,420
Cash flows from investing activities:    
Purchases of property and equipment (114,215) 47,533
Restricted cash account 2,872,869
Net cash provided by investing activities 2,785,654 47,533
Cash flows from financing activities:    
Proceeds from issuance of notes payable, net 275,000
Payments on factor line of credit, net (259,934)
Payments on notes payable (446,183) (238,881)
Proceeds from issuance of notes payable-related parties 175,642
Payments on notes payable-related parties (32,325)
Payment of deferred financing costs (20,599)
Issuance of preferred stock 775,000
Net cash (used in) provided by financing activities 726,535 (498,815)
Net change in cash (128,074) 148,158
Cash, beginning of period 205,133 41,372
Cash, end of period 77,059 189,530
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:    
Cash paid for interest 643,597 150,276
Non-cash financing activities:    
Notes payable issued to finance equipment purchases 631,361 523,617
Common stock shares issued for notes payable 9,560
Issuance of notes to settle accrued litigation 146,000
Issuance of notes to settle accounts payable 123,148
Preferred shares issued as incentive 155,020
Accrued dividends, preferred stock (39,781) (39,779)
Unpaid subscription for preferred shares 549,907
Preferred shares issued to settle rent obligation $ 50,000