Quarterly report pursuant to Section 13 or 15(d)

Statements of Cash Flows

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Statements of Cash Flows (USD $)
 3 Months Ended
Mar. 31, 2012
Mar. 31, 2011
Cash flows from operating activities:    
Net loss $ (1,616,908) $ (1,559,013)
Adjustments to reconcile net loss to net cash used in operating activities:    
Depreciation and amortization 19,565 20,090
Accretion of discount on note payable to shareholder 7,463  
Stock-based compensation expense 261,403 118,929
Changes in operating assets and liabilities:    
Accounts receivable, net 29,330 27,124
Income tax receivable   362,218
Inventory, net 112,607 (8,389)
Prepaid expenses and other current assets 39,516 34,945
Accounts payable and accrued expenses 11,690 (203,205)
Deferred revenue (7,766) 83,680
Net cash used in operating activities (1,143,100) (1,123,621)
Cash flows from financing activities:    
Borrowings under note payable to shareholder 1,250,000  
Borrowings under convertible secured note payable to shareholder 750,000 1,000,000
Payments on short term notes payable (31,551) (38,925)
Restricted cash (receipts) released, net (29,144) 86,876
Net cash provided by financing activities 1,939,305 1,047,951
Net increase (decrease) in cash and cash equivalents 796,205 (75,670)
Cash and cash equivalents at beginning of the period 171,739 132,103
Cash and cash equivalents at end of the period 967,944 56,433
Supplemental disclosure of cash flow information    
Interest paid 447 1,702
Non-cash investing and financing activities:    
Borrowing under short term notes payable for prepaid expense 50,037 48,988
Par value of restricted stock granted as stock compensation   20
Conversion of note payable and accrued interest to common stock and warrants 8,737,011  
Discount on note payable to shareholder for warrants issued $ 483,559  
Par value of restricted stock forfeited $ 5