Quarterly report pursuant to sections 13 or 15(d)

Condensed Balance Sheets (Unaudited)

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Condensed Balance Sheets (Unaudited) (USD $)
Jun. 30, 2013
Dec. 31, 2012
Current Assets:    
Cash and cash equivalents $ 6,977,875 $ 1,620,005
Accounts receivable 440,704 445,432
Inventory 1,196,975 899,702
Prepaid expenses and other current assets 135,305 110,873
Total current assets 8,750,859 3,076,012
Property and equipment, net 1,204,851 1,287,115
Software license inventory 1,015,000 1,137,500
Other assets 17,900 51,119
Total assets 10,988,610 5,551,746
Current liabilities:    
Accounts payable 1,714,719 1,961,195
Accrued compensation 136,426 278,124
Other accrued liabilities 332,055 1,177,142
Derivative liabilites 2,855,367 2,129,091
Related party deferred revenue   650,000
Deferred product revenue 75,787 112,725
Total current liabilities 5,114,354 6,308,277
Other accrued liabilities 359,732 574,722
Related party convertible notes payable 4,338,601 4,338,601
Note payable, net of unamortized discount of $504,944 and $0 at June 30, 2013 and December 31, 2012, respectively 3,784,500 2,000,000
Junior secured notes payable, net of unamortized discounts of $2,789,777 and $2,804,451 at June 30, 2013 and December 31, 2012, respectively 210,223 195,549
Total liabilities 13,807,410 13,417,149
Commitments and contingencies (Notes 5, 6 and 8)      
Stockholders' deficit:    
Common stock, $.01 par value; 100,000,000 shares authorized; 58,119,470 and 57,793,640 shares issued and outstanding, respectively, at June 30, 2013; and 48,418,830 and 48,093,000 issued and outstanding, respectively, at December 31, 2012 581,194 484,187
Additional paid-in capital 66,121,248 58,995,972
Treasury stock, at cost, 325,830 common shares (1,679,234) (1,679,234)
Accumulated deficit (67,842,008) (65,666,328)
Total stockholders' deficit (2,818,800) (7,865,403)
Total liabilities and stockholders' deficit $ 10,988,610 $ 5,551,746