Annual report pursuant to Section 13 and 15(d)

Statements of Cash Flows

Statements of Cash Flows - USD ($)
12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Cash Flows from Operating Activities:    
Net loss $ (27,651,412) $ (5,941,457)
Adjustment to reconcile net loss to net cash used in operating activities:    
Depreciation 120,723 119,627
Amortization of original issue discount and debt issuance cost and non-cash inducement cost for debt conversion 5,278,132 1,089,204
Stock issued in settlement of litigation 939,538
Change in the fair value of warrant derivative 14,336,425
Stock-based compensation expense 557,042 112,215
Stock issued in lieu of deferred salaries 650,100
Changes in operating assets and liabilities:    
(Increase) decrease in accounts receivable (832,446) 19,639
Decrease (increase) in factor receivables 120,563 (424,486)
(Increase) decrease in inventory (281,243) 77,006
(Increase) decrease in prepaid expenses (169,500) 32,500
Decrease (increase) in security deposits 8,553 (31,235)
(Decrease) increase in accounts payable (368,323) 1,959,692
(Decrease) Increase in accrued payroll taxes (318,713) 352,105
(Decrease) increase in accrued interest (699,576) 607,109
Increase in other current liabilities 80,461 86,873
(Decrease) increase in accrued liabilities (13,739) 511,740
Net cash used in operating activities (8,243,415) (1,429,468)
Cash Flows from Investing Activities:    
Cash paid for purchase of property and equipment (69,926)
Net cash used in investing activities (69,926)
Cash Flows from Financing Activities:    
Proceeds from sale of common stock, net of costs 11,671,735
Proceeds from sale of common stock of overallotment, net of costs 121,909
Proceeds from sale of convertible preferred stock, net of costs 1,201,157
Proceeds from notes payable, net of costs 752,579
Cash repayments of notes payable (114,000)
Proceeds from notes payable, related parties 400,000
Payments for debt issuance cost (25,000)
Payment of advance from officer (200,000)
Cash proceeds (payments) from loans payable 225,571 (165,188)
Net cash provided by financing activities 13,658,951 209,812
Net increase (decrease) in cash 5,415,536 (1,289,582)
Cash, beginning of the period 44,348 1,333,930
Cash, end of the period 5,459,884 44,348
Supplemental disclosures of cash flow information:    
Cash paid for income taxes
Cash paid for interest 638,693 466,181
Supplemental disclosures of non-cash investing and financing activities:    
Conversion of deferred salaries into common stock 650,100
Conversion of notes payable of officer into common stock 200,000
Conversion of notes payable into Class A Units 862,500
Conversion of convertible debentures into Class A Units 8,633,390
Conversion of convertible preferred stock into Class A Units 6,833,839
Issuance of Class B Warrants for capital raise 594,293
Accretion of redeemable convertible preferred stock dividend 3,667,620
Common stock deemed dividend $ 980,375