ROUGHLY 215% INCREASE IN CASH FLOW
NUMBERS DONT LIE
Nine Months Ended
March 31, 2014
March 31, 2013
Cash flows from operating activities:
Net loss
$ (3,557,172 ) $ (1,641,774 )
Changes in non cash working capital items:
Stock issued for services
- 76,000
Depreciation
1,714 1,714
Amortization
41,668 38,679
Amortization of deferred financing fees
18,442 -
Accretion on discount on convertible bond
- 50,490
Accretion on discount on convertible notes
573,350 325,302
Settlement of liabilities with stock-based compensation
1,080,000 -
Day-one loss on derivative liability
379,531 145,716
Loss (gain) on derivative liability
303,685 (241,484 )
Changes in Operating assets and liabilities:
Accounts receivable
25,119 3,099
Inventory
174,611 (31,691 )
Prepaid expenses
35,698 (81,159 )
Accounts payable
259,322 52,072
Accrued wages - officers
151,904 196,228
Accrued expenses
122,472 148,014
Net cash used for operating activities
(389,656 ) (958,794 )
Cash flows from investing activities:
Patent acquisition costs
(3,028 ) (7,487 )
Property and equipment acquisition costs
(232 ) -
Trademark acquisition costs
(2,121 ) -
Net cash used for investing activities
(5,381 ) (7,487 )
Cash flows from financing activities:
Proceeds from notes
356,120 943,233
Repayment of notes
- (32,500 )
Proceeds from sale of stock and warrants,
net of issuance costs
- 61,350
Net cash provided by financing activities
356,120 972,083
Net change in cash
(38,917 ) 5,802
Cash at beginning of the period
41,180 562
Cash at end of the period
$ 2,263 $ 6,364
Supplemental disclosures of noncash investing and financing activities and other cash flow information:
Short-term debt and accrued interest converted to
common stock
$ 320,692 $ 187,713
Common stock issued to satisfy accrued wages
and accounts payable
180,000 -
Retirement of derivative liability - convertible debt
565,909 262,059
Issuance of derivative liability - convertible debt
789,757 205,000
Issuance of common stock for debt discount
- 115,000
Reclassification of contingently redeemable stock
115,000 -
Interest paid with cash
14,263 69,237
See accompanying notes to unaudited condensed financial statements.
