OTHER INFORMATION

3 Months Ended

Mar. 31, 2016

Organization, Consolidation and Presentation of Financial Statements [Abstract]

OTHER INFORMATION

Foreign Sales

The Company generated approximately $8,000 and $9,100 of foreign sales during the three months ended March 31, 2016 and 2015, respectively.

Concentration of Suppliers

The Company purchases the majority of its inventories from two suppliers that are located in foreign countries. If the Company no longer had access to these suppliers, management believes the Company could locate alternative suppliers. However, there could be temporary shortages of inventories during a transition to new suppliers.

Dependence on a Single Lender

As discussed in Note 6, the Company has engaged in significant financing activities during 2015 and 2016 whereby over 76% of the Company’s debt financing as of March 31, 2016, has been obtained from Calm Waters. Presented below is a summary of amounts owed to Calm Waters as of March 31, 2016:

	Interest			Maturity
Description of Financing	Rate			Date	Principal
April 2015 Term Loan		12.0	%	April 2018	$	35,000
June 2015 Term Loan		12.0	%	April 2018		6,000
October 2015 Term Loan		12.0	%	April 2018		18,000
January 2016 Term Loan		12.0	%	April 2018		9,043
Forbearance Agreement		14.0	%	March 2017		1,251
Former 15% Notes		8.0	%	August 2016		8,249
Total					$	77,543

In addition to the concentration of debt held by Calm Waters, the Company has issued warrants to Calm Waters for an aggregate of approximately 294,294,399 shares of common stock which are exercisable for 5,995,453 shares at $0.21 per share, 45,214,775 shares exercisable at $0.25 per share, 226,252,838 shares at $0.45 per share, and 16,831,333 shares at $1.01 per share. As a condition of the warrant agreements, Calm Waters is not permitted to own more than 4.99% of the Company’s common stock (the “Beneficial Ownership Threshold”) upon exercise of outstanding warrants. Upon 61 days’ notice, Calm Waters is permitted to decrease or increase the Beneficial Ownership Threshold but may never increase the Beneficial Ownership Threshold in excess of 9.99%.

Accounts Receivable 

Accounts receivable is presented net of allowances for bad debts and estimated sales returns. As of March 31, 2016 and December 31, 2015, such allowances amounted to $1,297 and $1,565, respectively.

Disclosures Related to Statements of Operations

Presented below are certain expenses included in the accompanying statements of operations for the three months ended March 31, 2016 and 2015:

Description of Expense	2016		2015
Professional fees and administrative expenses:
Bad debt expense	$	6	$	50
Repairs and maintenance		10		24
Rent expense		60		50
Marketing and selling expenses:
Advertising		1,744		2,021
Rent expense		1,034		564