Annual report pursuant to Section 13 and 15(d)

STATEMENT OF CASH FLOWS

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STATEMENT OF CASH FLOWS - USD ($)
 12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Cash flows from operating activities    
Net loss $ (6,097,286) $ (4,816,680)
Adjustments to reconcile net loss to net cash used in operating activities:    
Stock-based compensation 1,810,267 490,520
Amortization of discount of notes payable 1,752,639 678,061
Amortization of debt issuance costs 101,852 102,183
Amortization of right to use assets 378,261
Amortization of customer acquisition costs 34,467 137,866
Amortization of patent rights 201,200 201,200
Depreciation expense 314,908 456,914
Loss on debt exchange 44,036
Loss on change in fair value of profit share 374,462
(Gain) Loss on sale of equipment (29,560) 6,303
Changes in operating assets and liabilities    
Decrease in accounts receivable 419,252 1,289,227
(Increase) Decrease in inventory (4,082) 150,163
Decrease in prepaid expenses and other assets 34,915 73,907
(Decrease) Increase in accounts payable and accrued liabilities (426,638) 62,623
Increase in deferred compensation (198,782) 555,877
Increase in accrued interest 129,163 19,402
(Decrease) in operating lease liability (371,986)
(Decrease) in deferred revenue and customer credits (517,060)
Net cash used in operating activities (1,576,948) (1,065,458)
Cash flows used in investing activities    
Cash received from sale of equipment 30,000
Purchase of property and equipment (131,915)
Net cash used in investing activities 30,000 (131,915)
Cash flows from financing activities    
Payments on secured promissory note (46,682) (875,000)
Payments of equipment notes payable (91,960) (61,177)
Proceeds from the issuance of convertible promissory notes and related warrants 2,600,000 300,000
Net cash provided by (used in) financing activities 2,461,358 (636,177)
Net increase (decrease) in cash and cash equivalents 914,410 (1,833,550)
Cash and cash equivalents - beginning of year 584,877 2,418,427
Cash and cash equivalents - end of year 1,499,287 584,877
SUPPLEMENTAL CASH FLOW INFORMATION:    
Cash paid during the period for: Interest 1,175,450
Cash paid during the period for: Taxes 14,000 22,153
SUPPLEMENTAL DISCLOSURE OF NON-CASH TRANSACTIONS    
Cumulative effect on accumulated deficit of lease accounting change 77,866
Discount on convertible promissory notes payable 485,640
Net adjustment for extension of lease 145,267
Stock warrants issued for prepaid services 243,294
Stock options issued for prepaid services 18,723
Conversion of secured notes payable into unsecured notes payable 560,000
Capital contribution (3,412,204)
Warrants issued upon debt exchange $ 89,500