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On July 15, 2011, the company issued warrants to purchase 3% of fully diluted shares of the common stock of the Company to Breakwater Structured Growth Opportunity Fund, L.P., with an imputed exercise price equal to approximately one-hundredth of a dollar in connection with a $1.025 million subordinated mezzanine loan arrangements.
2.25
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2025-03-20
2025-03-05
2016-06-15
2018-01-01
2018-07-16
Three year vesting schedules of 1/3 each year through March 2018
Fully vested
Fully vested
These warrants were subject to conditional vesting schedule in one-fourth (quarterly) increments, subject to the Company’s sole discretion. The first increment was granted and fully vested on January 1, 2013, the second increment was granted and fully vested on April 1, 2013, the third increment was granted and fully vested on July 1, 2013, and the fourth increment was granted and fully vested on October 1, 2013
Fully vested
The Company used a lattice model in developing a fair value for the Breakwater warrant obligation at December 31, 2014, using a quoted stock value of $.55 per share, which represents a discount of 50% from the closing stock price. This reduction was based on the application of a discount for lack of liquidity.
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2000000
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Prime (as reflected in the Wall Street Journal) plus 2.0%
The principal balance will note bear interest at the one month USD LIBOR rate measured not more often than once per month (the "Index"). Interest on any unpaid balance will bear interest at the Index plus 3.750% with a minimum interest rate of 4.00% per annum and is payable monthly.
The agreement requires the Company to comply with certain affirmative covenants, including a minimum current ratio of 1.5 to 1, a maximum leverage ratio of 2 to 1, and minimum tangible equity capital of $2,750,000 through November 30, 2014, and $3,000,000 thereafter, as well as providing limitations on dividends, additional indebtedness, and certain other changes.
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<p style="font-family: Times New Roman, Times, Serif; text-indent: 0; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b><u>Note
1 - Summary of Significant Accounting Policies</u></b></font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Organization and Nature of Business, and Basis
of Presentation</b></font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">iSatori, Inc. (the “Company”)
was incorporated under the laws of the state of Delaware on December 18, 1991. The trading symbol of the Company on OTCQB is “IFIT”.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company is engaged in researching,
designing, developing, contracting for the manufacture, marketing, selling and distributing of various branded nutritional and
dietary supplement products for the general nutrition market. The “general nutrition market” may include such activities
as body-building, physique enhancement (increase of lean body mass and decrease in fat mass) and enhanced athletic performance
through increased strength and/or endurance and proper nutrition.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company does engage from
time to time in funding of clinical studies with the objective of discovering and/or validating claims of new, efficacious products
for the Company’s relevant market as well as providing necessary and appropriate substantiation for any claims which the
Company may use in its marketing and advertising. The Company markets products which are under its control and which are in some
way proprietary to the Company. Some of the Company’s products are the subject of trademarks owned by the Company.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Unaudited Interim Financial
Information</b></font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font-family: Times New Roman, Times, Serif; text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The
accompanying interim condensed financial statements have been prepared in accordance with our accounting practices described in
our audited financial statements for the year ended December 31, 2014, and are unaudited. The unaudited interim condensed financial
statements should be read in conjunction with the audited financial statements and accompanying notes for the year ended December
31, 2014. The accompanying interim condensed financial statements are presented in accordance with the rules and regulations of
the Securities and Exchange Commission and, accordingly, do not include all the disclosures required by generally accepted accounting
principles in the United States (“U.S. GAAP”) with respect to annual financial statements. In the opinion of management,
all adjustments, consisting of normal recurring accruals that are considered necessary for a fair presentation of the interim
financial information, have been included. However, operating results for the periods presented are not necessarily indicative
of the results that may be expected for a full year.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Financial Instruments</b></font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font-family: Times New Roman, Times, Serif; text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The
Company considers all highly liquid debt instruments purchased with an original maturity of three months or less to be cash equivalents.
Accordingly, cash and cash equivalents consist of petty cash, checking accounts and money market funds.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Fair Value Measurements</b></font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">ASC 820-10 establishes a framework
for measuring the fair value of assets and liabilities and requires additional disclosure about fair value measurements. ASC 820-10
defines fair value as the price that would be received to sell an asset or paid to transfer a liability in the principal (or most
advantageous market) for the asset or liability in an orderly transaction between market participants at the measurement date.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font-family: Times New Roman, Times, Serif; text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">At
March 31, 2015 and December 31, 2014, the financial instruments of the Company consisted principally of cash and cash equivalents,
receivables, accounts payable, certain accrued liabilities and long-term debt. The carrying amount of cash and cash equivalents,
receivables, accounts payable and accrued liabilities approximates their fair value because of the short maturity of these instruments.
The actual and estimated fair values, respectively, of the Company’s financial instruments are as follows:</font></p>
<p style="margin: 0"></p>
<table cellspacing="0" cellpadding="0" align="center" style="margin-top: 0px; font-size: 9pt">
<tr style="font-size: 1pt">
<td style="width: 57%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 9%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 9%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 9%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 9%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr>
<td style="vertical-align: bottom"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="5" style="border-bottom: #000000 1px solid; vertical-align: bottom; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>March
31, 2015</b></font></td>
<td style="vertical-align: bottom; font-size: 8.5pt"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="5" style="border-bottom: #000000 1px solid; vertical-align: bottom; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>December
31, 2014</b></font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid"><p style="font-size: 8.5pt; text-align: center; margin: 0"><font style="font: 9pt Times New Roman, Times, Serif"><b>Carrying</b></font></p>
<p style="font-size: 8.5pt; text-align: center; margin: 0"><font style="font: 9pt Times New Roman, Times, Serif"><b>Amount</b></font></p></td>
<td><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>Fair
Value</b></font></td>
<td><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid"><p style="font-size: 8.5pt; text-align: center; margin: 0"><font style="font: 9pt Times New Roman, Times, Serif"><b>Carrying</b></font></p>
<p style="font-size: 8.5pt; text-align: center; margin: 0"><font style="font: 9pt Times New Roman, Times, Serif"><b>Amount</b></font></p></td>
<td><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>Fair
Value</b></font></td></tr>
<tr style="background-color: #ebebff">
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"><b>Cash and cash equivalents</b></font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">513,202</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">513,202</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">738,725</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">738,725</font></td></tr>
<tr>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"><b>Receivables</b></font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,970,061</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,970,061</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">925,506</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">925,506</font></td></tr>
<tr style="background-color: #ebebff">
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"><b>Accounts Payable</b></font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,600,232</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,600,232</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">819,918</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">819,918</font></td></tr>
<tr>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"><b>Derivative Liability</b></font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">152,849</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">152,849</font></td></tr>
</table>
<p style="margin: 0"> </p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Trade Receivables and Credit Policy</b></font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">Trade receivables are uncollateralized
customer obligations due under normal trade terms requiring payment generally within 10-60 days from the invoice date. Accounts
are considered delinquent when outstanding for more than 7 days past due date. The Company does not have a policy of accruing
interest on past due accounts. Payments on trade receivables are applied as instructed per the customer, or to the earliest unpaid
invoices. The allowance for doubtful accounts represents an estimate of amounts considered uncollectible and is determined based
on management’s historical collection experience, adverse situations that may affect the customer’s ability to repay,
and prevailing economic conditions. Specific accounts deemed uncollectible are written off periodically with subsequent receipts
on previously written off accounts credited to bad debt expense. The allowance for doubtful accounts is $0 for each of the periods
ended March 31, 2015 and December 31, 2014. Receivables at each of the below respective periods consisted of the following:</font></p>
<p style="text-align: justify; margin: 0"></p>
<table cellspacing="0" cellpadding="0" style="width: 100%; margin-top: 0px; font-size: 9pt">
<tr style="font-size: 1pt">
<td style="width: 69%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 14%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 14%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr>
<td style="vertical-align: bottom"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; vertical-align: bottom"><p style="font-size: 8.5pt; text-align: center; margin: 0"><font style="font: 9pt Times New Roman, Times, Serif"><b>March
31,</b></font></p>
<p style="font-size: 8.5pt; text-align: center; margin: 0"><font style="font: 9pt Times New Roman, Times, Serif"><b>2015</b></font></p></td>
<td style="vertical-align: bottom; font-size: 8.5pt"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; vertical-align: bottom"><p style="font-size: 8.5pt; text-align: center; margin: 0"><font style="font: 9pt Times New Roman, Times, Serif"><b>December
31,</b></font></p>
<p style="font-size: 8.5pt; text-align: center; margin: 0"><font style="font: 9pt Times New Roman, Times, Serif"><b>2014</b></font></p></td></tr>
<tr style="background-color: #ebebff">
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"><b>Trade Receivables</b></font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,935,921</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">951,396</font></td></tr>
<tr>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"><b>Other</b></font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">34,140</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(25,890)</font></td></tr>
<tr style="background-color: #ebebff">
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"><b>Allowance for doubtful accounts</b></font></td>
<td style="border-bottom: #000000 1px solid; vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 1px solid; vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(0)</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid; vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 1px solid; vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(0)</font></td></tr>
<tr>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"><b>Totals</b></font></td>
<td style="border-bottom: #000000 3px double; vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,970,061</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double; vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">925,506</font></td></tr>
</table>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">In addition, the Company has
recorded an allowance for customer returns in the amount of approximately $85,000 at March 31, 2015 and December 31, 2014 in accrued
expenses.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Inventory Valuation</b></font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">Inventories of nutritional and
dietary supplements are stated at lower of cost or market on a first-in, first-out (FIFO) basis as noted below:</font></p>
<p style="text-align: justify; margin: 0"></p>
<table cellspacing="0" cellpadding="0" style="width: 100%; margin-top: 0px; font-size: 9pt">
<tr style="font-size: 1pt">
<td style="width: 68%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 15%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 14%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr>
<td style="vertical-align: bottom"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; vertical-align: bottom"><p style="font-size: 8.5pt; text-align: center; margin: 0"><font style="font: 9pt Times New Roman, Times, Serif"><b>March
31,</b></font></p>
<p style="font-size: 8.5pt; text-align: center; margin: 0"><font style="font: 9pt Times New Roman, Times, Serif"><b>2015</b></font></p></td>
<td style="vertical-align: bottom; font-size: 8.5pt"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; vertical-align: bottom"><p style="font-size: 8.5pt; text-align: center; margin: 0"><font style="font: 9pt Times New Roman, Times, Serif"><b>December
31,</b></font></p>
<p style="font-size: 8.5pt; text-align: center; margin: 0"><font style="font: 9pt Times New Roman, Times, Serif"><b>2014</b></font></p></td></tr>
<tr style="background-color: #ebebff">
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"><b>Labels and packaging</b></font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">160,598</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">170,435</font></td></tr>
<tr>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"><b>Raw materials</b></font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">298,090</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">308,333</font></td></tr>
<tr style="background-color: #ebebff">
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"><b>Finished goods</b></font></td>
<td style="border-bottom: #000000 1px solid; vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 1px solid; vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,645,926</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid; vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 1px solid; vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2,004,834</font></td></tr>
<tr>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"><b>Totals</b></font></td>
<td style="border-bottom: #000000 3px double; vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2,104,614</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double; vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2,483,602</font></td></tr>
</table>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Note Receivable</b></font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The predecessor company disposed
of a dormant product line of vitamins in December 2010. As part of the consideration in this divestiture, the Company received
from the purchaser of this product line an unsecured note in the amount of $170,000. The original note was due to be repaid on
or before March 2014, where interest accrued principally at an annual rate of 5%, based upon the initial $170,000 principal and
was payable monthly. As of March 31, 2013, the note was novated and a new promissory note was issued to reflect a modification
in the payment terms, which includes no interest. The total note receivable balance at March 31, 2015 was $78,984, and is due
to be repaid on or before May 1, 2017.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Revenue Recognition</b></font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company operates predominantly
as a distributor of its dietary supplement products through traditional large retailers and electronic intermediaries. Revenue
from product sales is recognized upon transfer of title to the Company’s product to its customers. Net sales represent product
sales less actual returns, allowances, discounts, and promotions. Sales to direct customers have an unconditional money back guarantee
for thirty to sixty days after the date of purchase. Sales to several of the retail customers carry a “Sale or Return”
Purchase agreement per contract, where if minimum sales thresholds are not met within required timeframe, the inventory will be
returned to the Company for full credit. Other retail customers receive a percentage discount from invoice to cover any customer
returns or damages they may incur. Returns, allowances and discounts, and promotions were $534,896 and $510,734 for the three
month period ended March 31, 2015 and 2014, respectively.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">In addition, the Company provides
allowances for sales returns based upon estimated and known returns. Product returns are recorded as a reduction of net revenues
and as a reduction of the accounts receivable balance.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company receives other revenues
which include but are not limited to shipping and handling charges billed to customers.</font></p>
<p style="text-align: justify; margin: 0"> </p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Cost of Sales</b></font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company purchases its products
directly from third party manufacturers. The Company’s cost of sales include product costs, cost of warehousing and distribution.
Included in the cost of sales are shipping and handling costs that are incurred by the Company.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Income Taxes</b></font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company utilizes the asset
and liability method of accounting for income taxes. Under this asset and liability method, deferred tax assets and liabilities
are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying
amounts of existing assets and liabilities, and their respective tax bases. Deferred tax assets and liabilities are measured using
enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. See Note
4, “Income Taxes”.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">Since 2012 was the Company’s
initial tax year, there are no prior federal or state tax returns subject to examination. Accordingly, the only taxable periods
subject to examination by federal and state taxing authorities are the periods ended December 31, 2014 and 2013. Federal and state
tax returns for the Company prior to the short form merger are open for the period ended December 31, 2011.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Leases</b></font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company leases its headquarters
facility, comprising approximately 10,044 square feet, in Golden (metropolitan Denver), Colorado. The total rent expense for each
of the three month periods ended March 31, 2015 and 2014, was $20,716. The lease term expires January 31, 2017 and requires equal
monthly payments over the remaining term. Future payments under the lease total $151,916.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company leases its warehouse
facility, of approximately 17,026 square feet in Denver. The total rent expense for the warehouse lease for the three month period
ended March 31, 2015 was $21,782. The lease term expires on December 31, 2018 and calls for inflation-adjusted increasing payments
over the remaining term. Future payments under the warehouse lease are $352,877.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company also leases miscellaneous
office and warehouse equipment. In most cases, management expects that in the normal course of business these leases will be renewed
or replaced by other leases as applicable.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Marketing</b></font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company expenses all production
costs related to advertising costs as they are incurred, including print and television when the advertisement has been broadcast
or otherwise distributed. Other marketing expenses include digital and social media, product sampling, sponsorships and endorsements
with athletes, promotional events, and consumer education efforts. For the three month period ended March 31, 2015 and 2014, marketing
expenses totaled $340,551 and $627,423, respectively.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Research and Development Costs</b></font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">Research and development costs
are expensed when incurred. Research and development costs of $18,710 and $6,424 for the three month period ended March 31, 2015
and 2014, respectively, are included in selling and marketing expense.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Distribution, Shipping and
Handling Costs</b></font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">Shipping costs on purchases and
shipping and handling fees related to sales charged to customers are both included in cost of sales. As mentioned in Revenue Recognition,
shipping and handling revenue billed customers are reflected in other revenues.</font></p>
<p style="text-align: justify; margin: 0"> </p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Concentration of Credit Risk</b></font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">Financial instruments that potentially
subject the Company to concentration of credit risk consist principally of temporary cash investments and trade accounts receivables.
Concentrations of credit with respect to trade receivables are limited due to the large number of customers comprising the Company’s
customer bases and their dispersion across different geographic locations.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company maintains cash balances
at one financial institution located in Colorado and one in California. Accounts at these institutions are insured by the Federal
Deposit Insurance Corporation (FDIC) up to $250,000 per account. At times during the year, the Company’s bank balances have
exceeded the FDIC limit. Management believes the risk of loss at such institutions to be minimal.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">During the three month period
ended March 31, 2015, sales to four customers made up 61% of total product revenue, with each customer representing greater than
10% of product revenue on an individual basis. These customers’ combined accounts receivable balances were 67% of total
accounts receivable at March 31, 2015. During the three month period ended March 31, 2014, sales to three customers made up 67%
of total product revenue, with each customer representing greater than 10% of product revenue on an individual basis. These customers’
combined accounts receivable balances were 77% of total accounts receivable as of March 31, 2014.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">During the three month period
ended March 31, 2015, purchases from three vendors made up 73% of total inventory purchases. These vendors’ combined accounts
payable balances were 48% of total accounts payable as of March 31, 2015. During the three month period ended March 31, 2014,
purchases from two vendors made up 69% of total inventory purchases. These vendors’ combined accounts payable balances were
71% of total accounts payable as of March 31, 2014.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Use of Estimates</b></font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The preparation of the financial
statements in conformity with accounting principles generally accepted in the United States of America requires management to
make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements
and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Significant estimates include but are not limited to the fair value determination of derivative instruments, the valuation allowance
with respect to estimated utilization of net operating losses, estimated allowances for sales returns and collectability of notes
receivable.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Earnings (Loss) Per Share</b></font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">Net earnings (loss) per share
is computed by dividing net income (loss) less preferred dividends for the period by the weighted average number of common stock
outstanding during each period. Diluted earnings (loss) per share is computed by dividing net income (loss) less preferred dividends
for the period by the weighted average number of common stock, common stock equivalents and potentially dilutive securities outstanding
during each period.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company has the following
common stock equivalents as of March 31, 2015 and 2014:</font></p>
<p style="margin: 0"></p>
<table cellspacing="0" cellpadding="0" style="width: 100%; margin-top: 0px; font-size: 9pt">
<tr style="font-size: 1pt">
<td style="width: 73%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 12%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 2%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 12%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr>
<td style="vertical-align: bottom"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid; vertical-align: bottom; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>2015</b></font></td>
<td style="vertical-align: bottom; font-size: 8.5pt"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid; vertical-align: bottom; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>2014</b></font></td></tr>
<tr style="vertical-align: bottom; background-color: #ebebff">
<td><font style="font: 10pt Times New Roman, Times, Serif">Stock options (exercise price – $0.573-$2.50/share)</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">781,351</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">713,479</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif">Warrants (exercise price – $0.001-$2.25/share)</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">350,000</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,544,204</font></td></tr>
<tr style="vertical-align: bottom; background-color: #ebebff">
<td><font style="font: 10pt Times New Roman, Times, Serif">Total common stock equivalents</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">13,213,246</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">14,546,736</font></td></tr>
</table>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-indent: 0; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b><u>Note 2 - Contingencies</u></b></font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">In accordance with the standards
on contingencies, the Company accrues a loss contingency if it is probable and can reasonably be estimated or a liability has
been incurred at the date of the financial statements. If both of these conditions are not met, or if an exposure to loss exists
in excess of the amount accrued, disclosure of the contingency shall be made when there is at least a reasonable possibility that
a loss or an additional loss may have been incurred. The Company is exposed to legal claims encountered in the normal course of
business. See Note 3, “Litigation”. Management believes that the ultimate resolution of these matters will not have
a material adverse effect on the operating results or the financial position of the Company.</font></p>
<p style="text-align: justify; text-indent: 0; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b><u>Note
3 - Litigation</u></b></font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company is engaged in various
legal actions, claims and proceedings arising in the normal course of business, including claims related to breach of contracts,
product liabilities and intellectual property matters resulting from the Company’s business activities. As with most actions
such as these, an estimation of any possible and/or ultimate liability cannot always be determined. The following summaries highlight
the current status of certain material commercial litigation in which the Company is involved.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">On May 17, 2013 and on January
31, 2014 the Company received demand letters from the Environmental Research Corporation, “ERC” requesting substantiation
of compliance with the State of California’s Proposition 65 regulations for ten of its products. In October, while the Company
was awaiting the results of the compliance testing, ERC contacted the Company again requesting settlement to their initial demand
letter. And in February 2014, before compliance testing or any other demand letter validation was completed, ERC contacted the
Company again requesting settlement to their second demand letter. After many discussions with ERC, a lawsuit was filed by ERC
for the non-compliance issues with the State of California’ Proposition 65 regulations. After many conversations and mediation
attempts, both parties agreed to a settlement, which was approved by the iSatori Board of Directors. The documents were currently
generated for presentation to the California Court. Once accepted by the court, settlement amounts will be paid. This action is
expected to happen in Q1 or Q2 2015. As of the end of Q1 2015 the Court had not responded. The Company believes this settlement
of the lawsuit is in the best interest of iSatori and is not material to the business. Settlement amounts have been accrued into
FY 2014 and are reflected in this 10Q report.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">On March 24, 2014 the Company
received a summons in a civil action filed by Wise Sports Nutrition, LLC claiming alleged trademark infringement for iSatori’s,
Garcinia Trim product. Company counsel has made contact with the plaintiff’s attorney and filed a response to the alleged
trademark infringement with the Company’s counterclaims. The Company believes the counterclaims have strong merit and are
pursuing their defense. Both parties have prepared responses and presented them to the court. The court has recently ruled in
favor of iSatori and its filing of a motion for summary judgment. As a result of this ruling the trademark has been ruled as “descriptive”
and therefore not eligible for trademark assignment. Settlement discussions are underway. It is not possible to make a determination
of the outcome. Therefore, no range of any possible gain or loss can be reasonably estimated as of the date of the financial statements.</font></p>
<p style="text-align: justify; text-indent: 0; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b><u>Note
4 - Income Taxes</u></b></font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">For the three months ended March
31, 2015 and 2014, the Company recognized income tax expense of $2,930 and expense of $15,823, respectively.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The difference between the three
months ended March 31, 2015 effective rate of 0.0% and the Federal statutory rate of 35.0% is primarily due to a full valuation
allowance of $844,543 which was recognized at December 31, 2014, has been recognized on the deferred tax assets relating to the
net operating loss carry forwards. Should future financial performance change and it is determined the Company can realize the
use of these net operating losses, the appropriate tax expense and equity adjustments will be made.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The difference between the three
months ended March 31, 2014 effective rate of 4.5% and the Federal statutory rate of 35.0% is primarily due to state income taxes
(net of federal benefit), change in the valuation allowance, and an adjustment to the income tax receivable.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">At March 31, 2015 management
believes there are no uncertain tax liabilities.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; text-indent: 0; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b><u>Note
5- Stockholders’ Equity</u></b></font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">At March 31, 2015, there were 13,373,791 shares of
common stock, par value $.01 per share, outstanding for the Company.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><i>Warrants</i></font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">As of March 31, 2015, there were
common stock warrants outstanding to purchase aggregate shares of common stock pursuant to the warrant grants described below.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">On July 15, 2011 the Company
issued warrants, now totaling 420,549 shares, to purchase 3% of fully diluted shares of the common stock of the Company to Breakwater
Structured Growth Opportunity Fund, L.P., (the “Breakwater warrant”) with an imputed exercise price equal to approximately
one-hundredth of a dollar in connection with a $1.025 million subordinated mezzanine loan arrangement. These warrants are fully
vested and expire on June 15, 2016.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">Included in the aforementioned
Breakwater warrant, was an obligation by the Company to, among other things, honor an irrevocable put right through which the
Company agreed to purchase up to the 3% of fully diluted shares of its common stock underlying the warrant, which expires on July
15, 2016. Upon completion of the Merger, the irrevocable put right was removed.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The warrant was exercised on
February 24, 2015, pursuant to the net exercise provisions of Section 3(b) of the warrant, using a cashless exercise. The Company
used a lattice model to develop a fair value for the Breakwater warrant obligation to value the warrant one final time as of the
date of exercise, using a quoted stock value of $.55 per share, which represents a discount of 50% from the closing stock price.
This reduction was based on the application of a discount for lack of liquidity. Other assumptions used in the valuations include
(a) risk free interest rate of .22% based on duration, (b) weighted average expected term in years of 1.39, (c) weighted average
expected stock volatility of 37.13%, (d) expected dividends of 0% (e) stock price movements ranging from 1.053 to .950 and (f)
risk neutral probabilities ranging from .488 to .512. These valuations resulted in an expense of $61,988 in the Statement of Operations
and $214,837 added to equity on the Balance Sheet for the period ended March 31, 2015.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">Effective January 1, 2013, the
Company entered into a one year agreement, subject to quarterly cancellation at the Company’s sole discretion, with Microcap
Headlines, Inc. In connection with this agreement, the Company issued warrants to purchase an aggregate of 100,000 shares of the
Company’s common stock at an exercise price of $2.25 per share (the “Microcap warrants”). These warrants were
subject to conditional vesting schedule in one-fourth (quarterly) increments, subject to the Company’s sole discretion.
The first increment was granted and fully vested on January 1, 2013, the second increment was granted and fully vested on April
1, 2013, the third increment was granted and fully vested on July 1, 2013, and the fourth increment was granted and fully vested
on October 1, 2013. These vested warrants expire on January 1, 2018.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">Effective July 16, 2013, the
Company entered into a business consulting agreement with Optivest Global Partners, LLC. In connection with this agreement, the
Company issued warrants to purchase an aggregate of 250,000 shares of the Company’s common stock at an exercise price of
$2.25 per share (the “Optivest warrants”). These warrants are fully vested and expire July 16, 2018. These warrants
will be assignable and transferable, at Optivest’s discretion.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company has 350,000 warrants
outstanding at March 31, 2015 and 770,649 at December 31, 2014.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The fair value of the Microcap
and Optivest warrants were estimated on the date of grant using the Black-Scholes option-pricing model.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Black-Scholes assumptions
used when the warrants were issued are as follows:</font></p>
<p style="margin: 0"></p>
<table cellspacing="0" cellpadding="0" style="width: 100%; margin-top: 0px; font-size: 9pt">
<tr style="font-size: 1pt">
<td style="width: 83%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 14%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 2%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr>
<td style="vertical-align: bottom"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; vertical-align: bottom; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>FY
2013</b></font></td>
<td style="vertical-align: bottom"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: #ebebff">
<td><font style="font: 10pt Times New Roman, Times, Serif">Exercise price</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.25</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif">Expected dividends</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">%</font></td></tr>
<tr style="vertical-align: bottom; background-color: #ebebff">
<td><font style="font: 10pt Times New Roman, Times, Serif">Expected volatility</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">45.95-48.97</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">%</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif">Risk fee interest rate</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.72-1.42</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">%</font></td></tr>
<tr style="vertical-align: bottom; background-color: #ebebff">
<td><font style="font: 10pt Times New Roman, Times, Serif">Expected life</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">5 years</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif">Expected forfeiture</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">%</font></td></tr>
</table>
<p style="margin: 0"> </p>
<p style="margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The Company assumed the 1,069,587 outstanding warrants
to purchase shares of Common Stock which were issued by Integrated in fiscal years 2009 and before. Of these, 17,230 expired on
July 29, 2012 and the remainder expired on May 31, 2014.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><i>2012 Performance Incentive
Plan</i></font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">On September 27, 2012, the Company’s
Board of Directors approved the 2012 Performance Incentive Plan (the Plan”). The Plan allows the Company to promote the
success of the Corporation and to increase stockholder value by providing an additional means through the grant of awards to attract,
motivate, retain and reward selected employees and other eligible persons. Any stock option granted in the form of an incentive
stock option will be intended to comply with the requirements of Section 422 of the Code. Only stock options granted to employees
qualify for incentive stock option treatment. A stock option may be exercised in whole or in installments, which may be cumulative.
Shares of common stock purchased upon the exercise of a stock option must be paid for in full at the time of the exercise in cash
or such other consideration determined by the compensation committee. Payment may include tendering shares of common stock or
surrendering of a stock award, or a combination of methods.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Plan is administered by the
Plan Administrator, being the Board or one or more committees appointed by the Board or another committee (within its delegated
authority) to administer all or certain aspects of this Plan. The Administrator has full and exclusive power within the limitations
set forth in the Plan to make all decisions and determinations regarding the selection of participants and the granting of awards;
establishing the terms and conditions relating to each award; adopting rules, regulations and guidelines; and interpreting the
Plan.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">On March 23, 2015, the Company
issued options to purchase 195,000 shares of the Company’s common stock to six employees with an exercise price of $1.02
per share and which contained three year vesting schedules of 1/3 each year through March 2018. These options are due to expire
on March 20, 2025.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">On March 5, 2015, the Company
issued options to purchase 10,000 shares of the Company’s common stock to a contracted employee with an exercise price of
$1.0065 per share, which are fully vested. These options are due to expire on March 5, 2025.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company
applied fair value accounting for all share based payment awards. The fair value of each option granted is estimated on the date
of grant using the Black-Scholes option-pricing model. The total valuation of the options granted in 2015 was $35,400. Of this,
$33,765 will be expensed over the three year vesting schedule. The total valuation of the options granted in 2014 was $3,363.
Due to their forfeiture prior to vesting, expense of $747 recognized in previous quarters of 2014 was reversed within subsequent
periods of 2014, for a net expense of $0 related to 2014 grants for the year ended December 31, 2014. The total valuation of the
options granted in 2013 was $30,985, which is being expensed over the three year vesting period. The expense recognized related
to these options for the year ended December 31, 2014 was $10,328. The Black-Scholes assumptions used when the options were issued
are as follows:</font></p>
<p style="margin: 0"></p>
<table cellspacing="0" cellpadding="0" style="width: 100%; margin-top: 0px; font-size: 9pt">
<tr style="font-size: 1pt">
<td style="width: 63%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 17%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 2%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 17%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr>
<td style="vertical-align: bottom"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>FY
2015</b></font></td>
<td style="vertical-align: bottom"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>FY
2014</b></font></td></tr>
<tr style="vertical-align: bottom; background-color: #ebebff">
<td><font style="font: 10pt Times New Roman, Times, Serif">Exercise price</font></td>
<td style="border-top: #000000 1px solid"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-top: #000000 1px solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1.0065-1.02</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-top: #000000 1px solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.22-2.50</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif">Expected dividends</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0%</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0%</font></td></tr>
<tr style="vertical-align: bottom; background-color: #ebebff">
<td><font style="font: 10pt Times New Roman, Times, Serif">Expected volatility</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">45.65%</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">35.22%</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif">Risk fee interest rate</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1.71-1.9%</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.13-2.41%</font></td></tr>
<tr style="vertical-align: bottom; background-color: #ebebff">
<td><font style="font: 10pt Times New Roman, Times, Serif">Expected life of option</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">7.51-8.01 years</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">6.08-6.33 years</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif">Expected forfeiture</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0%</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0%</font></td></tr>
</table>
<p style="text-align: justify; text-indent: 0; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b><u>Note
6- Revolving Line of Credit and Related Interest</u></b></font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company entered into a renewed
and expanded Credit Agreement with Colorado Business Bank West of Denver, Colorado on August 27, 2014. Borrowings under this agreement
will be used to provide ongoing working capital and for other general corporate purposes of the Company and its subsidiaries.</font></p>
<p style="margin: 0"> </p>
<p style="margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The agreement provides a revolving commitment to the
Company of $2,000,000. Amounts outstanding under the agreement will be reflected in a promissory note with a principal balance
of $2,000,000 and a maturity date of November 16, 2015 (the “Promissory Note”). The principal balance on the Promissory
Note bears interest at the one month USD LIBOR rate measured not more often than once per month (the “Index”). Interest
on any unpaid balance under the promissory note will bear interest at the Index plus 3.75% with a minimum interest rate of 4.00%
per annum, and is payable monthly. The agreement requires the Company to comply with certain affirmative covenants, including
a minimum current ratio of 1.5 to 1, a maximum leverage ratio of 2 to 1, and minimum tangible equity capital of $2,750,000 through
November 30, 2014, and $3,000,000 thereafter, as well as providing limitations on dividends, additional indebtedness, and certain
other changes.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">On January 7, 2015, Colorado
Business Bank provided the Company with notice of a non-monetary event of default concerning the Company’s violation of
the minimum tangible equity capital covenant set forth in the loan agreement. On March 27, 2015, and effective March 23, 2015,
the Company and Colorado Business Bank (“CBB”) entered into a Change in Terms Agreement (the “Change in Terms
Agreement) and Business Loan Agreement (the “Business Loan Agreement and, together with the Change in Terms Agreement, the
“Agreements”), to replace that previous Business Loan Agreement, dated as of July 16, 2012, by and between iSatori,
Inc. and CBB (the “Prior Agreement”).</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">Pursuant to the Agreements CBB
agreed to waive the violation of the Minimum Tangible Equity Covenant; the lending relationship between the Company and CBB was
restructured from a revolving loan to a term loan; the Company agreed to pay down the amount outstanding under the Prior Agreement
to $1,500,000 in the short term; and the Company agreed to monthly payments of $75,000 plus interest, at an interest rate of Prime
(as reflected in the Wall Street Journal) plus 2.0%, beginning in April 2015, and is set to mature on July 16, 2015.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif; background-color: #ffffff">The
Company has, and will continue to, enter into discussions with certain material vendors, offering early pay discounts to improve
the timing of accounts receivable collection. In addition, the Company has, and will continue to, enter into discussions with
certain material suppliers concerning extended credit terms to improve the flexibility of the Company's cash management program.
These actions will help ensure the Company's liquidity and compliance with its loan covenants.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company’s prior line
of credit with Colorado Business Bank West of Denver, Colorado provided a revolving commitment to the Company in the amount of
$1,500,000 and was in effect since its inception on July 16, 2012 and subsequent renewal on October 16, 2013 through the date
of the renewal and expansion on August 27, 2014. Other terms of the former credit agreement were the same as those of the renewed
and expanded credit agreement described above.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The outstanding balance on the
revolving line of credit as of March 31, 2015 and December 31, 2014 was $1,500,000 and $1,620,519.</font></p>
<p style="text-align: justify; text-indent: 0; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b><u>Note
7 - Fair Value Measurements and Disclosures</u></b></font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company follows ASC 820,
Fair Value Measurements and Disclosures, which defines fair value, establishes a framework for using fair value to measure assets
and liabilities, and expands disclosures about fair value measurements. The statement establishes a hierarchy for inputs used
in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring
that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing
the asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are
inputs that reflect the Company’s assumptions of what market participants would use in pricing the asset or liability developed
based on the best information available in the circumstances. The hierarchy is broken down into three levels based on the reliability
of the inputs as follows:</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">Level 1: Quoted prices are available
in active markets for identical assets or liabilities.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">Level 2: Quoted prices in active
markets for similar assets and liabilities that are observable for the asset or liability; or</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">Level 3: Unobservable pricing
inputs that are generally less observable from objective sources, such as discounted cash flow models or valuations.</font></p>
<p style="text-align: justify; margin: 0"> </p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">ASC 820 requires financial assets
and liabilities to be classified based on the lowest level of input that is significant to the fair value measurement. The Company’s
assessment of the significance of a particular input to the fair value measurement requires judgment, and may affect the valuation
of the fair value of assets and liabilities and their placement within the fair value hierarchy levels.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">For the purposes of marketable
securities where there is an active market, the Company uses the quoted prices available for the identical asset or liability.
As of March 31, 2015, the Company had $28,744 assets held for sale valued using the Level 1 mark-to-market approach. As of December
31, 2014, the Company had $34,979 assets held for sale valued using the Level 1 mark-to-market approach.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The inputs used in the fair value
measurements categorized within Level 3 include the stock price at the valuation date, the exercise price of the warrant, the
expected period of time the warrant will be outstanding, the annual volatility of the underlying stock price, the annual yield
rate of quarterly dividends, and the risk free rate of interest relevant to the expected time period the warrant will be outstanding.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The following table represents
the Company’s warrant derivative liabilities that were accounted for at fair value on a recurring basis by level within
the fair value hierarchy:</font></p>
<p style="margin: 0"></p>
<table cellspacing="0" cellpadding="0" style="width: 100%; margin-top: 0px; font-size: 9pt">
<tr style="font-size: 1pt">
<td style="width: 35%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 9%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 9%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 9%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 9%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 9%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 9%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr>
<td style="vertical-align: bottom"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="8" style="border-bottom: #000000 1px solid; vertical-align: bottom; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>March
31, 2015</b></font></td>
<td style="vertical-align: bottom; font-size: 8.5pt"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="8" style="border-bottom: #000000 1px solid; vertical-align: bottom; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>December
31, 2014</b></font></td></tr>
<tr style="vertical-align: bottom">
<td style="font-size: 8.5pt"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>Level
1</b></font></td>
<td style="font-size: 8.5pt"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>Level
2</b></font></td>
<td style="font-size: 8.5pt"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>Level
3</b></font></td>
<td style="font-size: 8.5pt"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>Level
1</b></font></td>
<td style="font-size: 8.5pt"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>Level
2</b></font></td>
<td style="font-size: 8.5pt"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>Level
3</b></font></td></tr>
<tr style="vertical-align: bottom; background-color: #ebebff">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">28,744</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">34,979</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">152,849</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: #ebebff">
<td><font style="font: 10pt Times New Roman, Times, Serif">Beginning of period</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">34,979</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">152,849</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">108,228</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">471,015</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif">Additions</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td></tr>
<tr style="vertical-align: bottom; background-color: #ebebff">
<td><font style="font: 10pt Times New Roman, Times, Serif">Deletions</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(214,837)</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(115,881)</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif">Revisions</font></td>
<td style="border-bottom: #000000 1px solid"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(6,235)</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">61,988</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">42,632</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(318,166)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #ebebff">
<td><font style="font: 10pt Times New Roman, Times, Serif">End of period</font></td>
<td style="border-bottom: #000000 3px double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">28,744</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">34,979</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">152,849</font></td></tr>
</table>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Organization and Nature of Business, and Basis
of Presentation</b></font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">iSatori, Inc. (the “Company”)
was incorporated under the laws of the state of Delaware on December 18, 1991. The trading symbol of the Company on OTCQB is “IFIT”.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company is engaged in researching,
designing, developing, contracting for the manufacture, marketing, selling and distributing of various branded nutritional and
dietary supplement products for the general nutrition market. The “general nutrition market” may include such activities
as body-building, physique enhancement (increase of lean body mass and decrease in fat mass) and enhanced athletic performance
through increased strength and/or endurance and proper nutrition.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company does engage from
time to time in funding of clinical studies with the objective of discovering and/or validating claims of new, efficacious products
for the Company’s relevant market as well as providing necessary and appropriate substantiation for any claims which the
Company may use in its marketing and advertising. The Company markets products which are under its control and which are in some
way proprietary to the Company. Some of the Company’s products are the subject of trademarks owned by the Company.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Financial Instruments</b></font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font-family: Times New Roman, Times, Serif; text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The
Company considers all highly liquid debt instruments purchased with an original maturity of three months or less to be cash equivalents.
Accordingly, cash and cash equivalents consist of petty cash, checking accounts and money market funds.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Fair Value Measurements</b></font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">ASC 820-10 establishes a framework
for measuring the fair value of assets and liabilities and requires additional disclosure about fair value measurements. ASC 820-10
defines fair value as the price that would be received to sell an asset or paid to transfer a liability in the principal (or most
advantageous market) for the asset or liability in an orderly transaction between market participants at the measurement date.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font-family: Times New Roman, Times, Serif; text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">At
March 31, 2015 and December 31, 2014, the financial instruments of the Company consisted principally of cash and cash equivalents,
receivables, accounts payable, certain accrued liabilities and long-term debt. The carrying amount of cash and cash equivalents,
receivables, accounts payable and accrued liabilities approximates their fair value because of the short maturity of these instruments.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Trade Receivables and Credit Policy</b></font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">Trade receivables are uncollateralized
customer obligations due under normal trade terms requiring payment generally within 10-60 days from the invoice date. Accounts
are considered delinquent when outstanding for more than 7 days past due date. The Company does not have a policy of accruing
interest on past due accounts. Payments on trade receivables are applied as instructed per the customer, or to the earliest unpaid
invoices. The allowance for doubtful accounts represents an estimate of amounts considered uncollectible and is determined based
on management’s historical collection experience, adverse situations that may affect the customer’s ability to repay,
and prevailing economic conditions. Specific accounts deemed uncollectible are written off periodically with subsequent receipts
on previously written off accounts credited to bad debt expense</font>.</p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Inventory Valuation</b></font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">Inventories of nutritional and
dietary supplements are stated at lower of cost or market on a first-in, first-out (FIFO) basis as noted below.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Revenue Recognition</b></font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company operates predominantly
as a distributor of its dietary supplement products through traditional large retailers and electronic intermediaries. Revenue
from product sales is recognized upon transfer of title to the Company’s product to its customers. Net sales represent product
sales less actual returns, allowances, discounts, and promotions. Sales to direct customers have an unconditional money back guarantee
for thirty to sixty days after the date of purchase. Sales to several of the retail customers carry a “Sale or Return”
Purchase agreement per contract, where if minimum sales thresholds are not met within required timeframe, the inventory will be
returned to the Company for full credit. Other retail customers receive a percentage discount from invoice to cover any customer
returns or damages they may incur.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">In addition, the Company provides
allowances for sales returns based upon estimated and known returns. Product returns are recorded as a reduction of net revenues
and as a reduction of the accounts receivable balance.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company receives other revenues
which include but are not limited to shipping and handling charges billed to customers.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Cost of Sales</b></font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company purchases its products
directly from third party manufacturers. The Company’s cost of sales include product costs, cost of warehousing and distribution.
Included in the cost of sales are shipping and handling costs that are incurred by the Company.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Income Taxes</b></font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company utilizes the asset
and liability method of accounting for income taxes. Under this asset and liability method, deferred tax assets and liabilities
are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying
amounts of existing assets and liabilities, and their respective tax bases. Deferred tax assets and liabilities are measured using
enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. See Note
4, “Income Taxes”.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">Since 2012 was the Company’s
initial tax year, there are no prior federal or state tax returns subject to examination. Accordingly, the only taxable periods
subject to examination by federal and state taxing authorities are the periods ended December 31, 2014 and 2013. Federal and state
tax returns for the Company prior to the short form merger are open for the period ended December 31, 2011.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Leases</b></font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company leases its headquarters
facility, comprising approximately 10,044 square feet, in Golden (metropolitan Denver), Colorado. </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company leases its warehouse
facility, of approximately 17,026 square feet in Denver.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company also leases miscellaneous
office and warehouse equipment. In most cases, management expects that in the normal course of business these leases will be renewed
or replaced by other leases as applicable.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Marketing</b></font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company expenses all production
costs related to advertising costs as they are incurred, including print and television when the advertisement has been broadcast
or otherwise distributed. Other marketing expenses include digital and social media, product sampling, sponsorships and endorsements
with athletes, promotional events, and consumer education efforts.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Research and Development Costs</b></font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">Research and development costs
are expensed when incurred.</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Distribution, Shipping and
Handling Costs</b></font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">Shipping costs on purchases and
shipping and handling fees related to sales charged to customers are both included in cost of sales. As mentioned in Revenue Recognition,
shipping and handling revenue billed customers are reflected in other revenues</font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Concentration of Credit Risk</b></font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">Financial instruments that potentially
subject the Company to concentration of credit risk consist principally of temporary cash investments and trade accounts receivables.
Concentrations of credit with respect to trade receivables are limited due to the large number of customers comprising the Company’s
customer bases and their dispersion across different geographic locations.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The Company maintains cash balances
at one financial institution located in Colorado and one in California. Accounts at these institutions are insured by the Federal
Deposit Insurance Corporation (FDIC) up to $250,000 per account. At times during the year, the Company’s bank balances have
exceeded the FDIC limit. Management believes the risk of loss at such institutions to be minimal.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Use of Estimates</b></font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The preparation of the financial
statements in conformity with accounting principles generally accepted in the United States of America requires management to
make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements
and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Significant estimates include but are not limited to the fair value determination of derivative instruments, the valuation allowance
with respect to estimated utilization of net operating losses, estimated allowances for sales returns and collectability of notes
receivable.</font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b>Earnings (Loss) Per Share</b></font></p>
<p style="margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="text-align: justify; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">Net earnings (loss) per share
is computed by dividing net income (loss) less preferred dividends for the period by the weighted average number of common stock
outstanding during each period. Diluted earnings (loss) per share is computed by dividing net income (loss) less preferred dividends
for the period by the weighted average number of common stock, common stock equivalents and potentially dilutive securities outstanding
during each period.</font></p>
<table cellspacing="0" cellpadding="0" align="center" style="margin-top: 0px; font-size: 9pt">
<tr>
<td style="vertical-align: bottom"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="5" style="border-bottom: #000000 1px solid; vertical-align: bottom; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>March
31, 2015</b></font></td>
<td style="vertical-align: bottom; font-size: 8.5pt"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="5" style="border-bottom: #000000 1px solid; vertical-align: bottom; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>December
31, 2014</b></font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid"><p style="font-size: 8.5pt; text-align: center; margin: 0"><font style="font: 9pt Times New Roman, Times, Serif"><b>Carrying</b></font></p>
<p style="font-size: 8.5pt; text-align: center; margin: 0"><font style="font: 9pt Times New Roman, Times, Serif"><b>Amount</b></font></p></td>
<td><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>Fair
Value</b></font></td>
<td><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid"><p style="font-size: 8.5pt; text-align: center; margin: 0"><font style="font: 9pt Times New Roman, Times, Serif"><b>Carrying</b></font></p>
<p style="font-size: 8.5pt; text-align: center; margin: 0"><font style="font: 9pt Times New Roman, Times, Serif"><b>Amount</b></font></p></td>
<td><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>Fair
Value</b></font></td></tr>
<tr style="background-color: #ebebff">
<td style="vertical-align: bottom; width: 57%"><font style="font: 10pt Times New Roman, Times, Serif"><b>Cash and cash equivalents</b></font></td>
<td style="vertical-align: bottom; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right; width: 9%"><font style="font: 10pt Times New Roman, Times, Serif">513,202</font></td>
<td style="vertical-align: bottom; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right; width: 9%"><font style="font: 10pt Times New Roman, Times, Serif">513,202</font></td>
<td style="vertical-align: bottom; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right; width: 9%"><font style="font: 10pt Times New Roman, Times, Serif">738,725</font></td>
<td style="vertical-align: bottom; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right; width: 9%"><font style="font: 10pt Times New Roman, Times, Serif">738,725</font></td></tr>
<tr>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"><b>Receivables</b></font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,970,061</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,970,061</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">925,506</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">925,506</font></td></tr>
<tr style="background-color: #ebebff">
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"><b>Accounts Payable</b></font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,600,232</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,600,232</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">819,918</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">819,918</font></td></tr>
<tr>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"><b>Derivative Liability</b></font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">152,849</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">152,849</font></td></tr>
</table>
<table cellspacing="0" cellpadding="0" style="width: 100%; margin-top: 0px; font-size: 9pt">
<tr>
<td style="vertical-align: bottom"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; vertical-align: bottom"><p style="font-size: 8.5pt; text-align: center; margin: 0"><font style="font: 9pt Times New Roman, Times, Serif"><b>March
31,</b></font></p>
<p style="font-size: 8.5pt; text-align: center; margin: 0"><font style="font: 9pt Times New Roman, Times, Serif"><b>2015</b></font></p></td>
<td style="vertical-align: bottom; font-size: 8.5pt"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; vertical-align: bottom"><p style="font-size: 8.5pt; text-align: center; margin: 0"><font style="font: 9pt Times New Roman, Times, Serif"><b>December
31,</b></font></p>
<p style="font-size: 8.5pt; text-align: center; margin: 0"><font style="font: 9pt Times New Roman, Times, Serif"><b>2014</b></font></p></td></tr>
<tr style="background-color: #ebebff">
<td style="vertical-align: bottom; width: 69%"><font style="font: 10pt Times New Roman, Times, Serif"><b>Trade Receivables</b></font></td>
<td style="vertical-align: bottom; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right; width: 14%"><font style="font: 10pt Times New Roman, Times, Serif">1,935,921</font></td>
<td style="vertical-align: bottom; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right; width: 14%"><font style="font: 10pt Times New Roman, Times, Serif">951,396</font></td></tr>
<tr>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"><b>Other</b></font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">34,140</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(25,890)</font></td></tr>
<tr style="background-color: #ebebff">
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"><b>Allowance for doubtful accounts</b></font></td>
<td style="border-bottom: #000000 1px solid; vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 1px solid; vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(0)</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid; vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 1px solid; vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(0)</font></td></tr>
<tr>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"><b>Totals</b></font></td>
<td style="border-bottom: #000000 3px double; vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,970,061</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double; vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">925,506</font></td></tr>
</table>
<table cellspacing="0" cellpadding="0" style="width: 100%; margin-top: 0px; font-size: 9pt">
<tr>
<td style="vertical-align: bottom"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; vertical-align: bottom"><p style="font-size: 8.5pt; text-align: center; margin: 0"><font style="font: 9pt Times New Roman, Times, Serif"><b>March
31,</b></font></p>
<p style="font-size: 8.5pt; text-align: center; margin: 0"><font style="font: 9pt Times New Roman, Times, Serif"><b>2015</b></font></p></td>
<td style="vertical-align: bottom; font-size: 8.5pt"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; vertical-align: bottom"><p style="font-size: 8.5pt; text-align: center; margin: 0"><font style="font: 9pt Times New Roman, Times, Serif"><b>December
31,</b></font></p>
<p style="font-size: 8.5pt; text-align: center; margin: 0"><font style="font: 9pt Times New Roman, Times, Serif"><b>2014</b></font></p></td></tr>
<tr style="background-color: #ebebff">
<td style="vertical-align: bottom; width: 68%"><font style="font: 10pt Times New Roman, Times, Serif"><b>Labels and packaging</b></font></td>
<td style="vertical-align: bottom; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right; width: 15%"><font style="font: 10pt Times New Roman, Times, Serif">160,598</font></td>
<td style="vertical-align: bottom; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right; width: 14%"><font style="font: 10pt Times New Roman, Times, Serif">170,435</font></td></tr>
<tr>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"><b>Raw materials</b></font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">298,090</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">308,333</font></td></tr>
<tr style="background-color: #ebebff">
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"><b>Finished goods</b></font></td>
<td style="border-bottom: #000000 1px solid; vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 1px solid; vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,645,926</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid; vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 1px solid; vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2,004,834</font></td></tr>
<tr>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"><b>Totals</b></font></td>
<td style="border-bottom: #000000 3px double; vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2,104,614</font></td>
<td style="vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double; vertical-align: bottom"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; vertical-align: top; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2,483,602</font></td></tr>
</table>
<table cellspacing="0" cellpadding="0" style="width: 100%; margin-top: 0px; font-size: 9pt">
<tr>
<td style="vertical-align: bottom; width: 73%"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom; width: 1%"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid; vertical-align: bottom; font-size: 8.5pt; text-align: center; width: 12%"><font style="font: 9pt Times New Roman, Times, Serif"><b>2015</b></font></td>
<td style="vertical-align: bottom; font-size: 8.5pt; width: 2%"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid; vertical-align: bottom; font-size: 8.5pt; text-align: center; width: 12%"><font style="font: 9pt Times New Roman, Times, Serif"><b>2014</b></font></td></tr>
<tr style="vertical-align: bottom; background-color: #ebebff">
<td><font style="font: 10pt Times New Roman, Times, Serif">Stock options (exercise price – $0.573-$2.50/share)</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">781,351</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">713,479</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif">Warrants (exercise price – $0.001-$2.25/share)</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">350,000</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,544,204</font></td></tr>
<tr style="vertical-align: bottom; background-color: #ebebff">
<td><font style="font: 10pt Times New Roman, Times, Serif">Total common stock equivalents</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">13,213,246</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">14,546,736</font></td></tr>
</table>
<table cellspacing="0" cellpadding="0" style="width: 100%; margin-top: 0px; font-size: 9pt">
<tr>
<td style="vertical-align: bottom; width: 63%"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom; width: 1%"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom; font-size: 8.5pt; text-align: center; width: 17%"><font style="font: 9pt Times New Roman, Times, Serif"><b>FY
2015</b></font></td>
<td style="vertical-align: bottom; width: 2%"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td style="vertical-align: bottom; font-size: 8.5pt; text-align: center; width: 17%"><font style="font: 9pt Times New Roman, Times, Serif"><b>FY
2014</b></font></td></tr>
<tr style="vertical-align: bottom; background-color: #ebebff">
<td><font style="font: 10pt Times New Roman, Times, Serif">Exercise price</font></td>
<td style="border-top: #000000 1px solid"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-top: #000000 1px solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1.0065-1.02</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-top: #000000 1px solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.22-2.50</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif">Expected dividends</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0%</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0%</font></td></tr>
<tr style="vertical-align: bottom; background-color: #ebebff">
<td><font style="font: 10pt Times New Roman, Times, Serif">Expected volatility</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">45.65%</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">35.22%</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif">Risk fee interest rate</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1.71-1.9%</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.13-2.41%</font></td></tr>
<tr style="vertical-align: bottom; background-color: #ebebff">
<td><font style="font: 10pt Times New Roman, Times, Serif">Expected life of option</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">7.51-8.01 years</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">6.08-6.33 years</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif">Expected forfeiture</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0%</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0%</font></td></tr>
</table>
<table cellspacing="0" cellpadding="0" style="width: 100%; margin-top: 0px; font-size: 9pt">
<tr>
<td style="vertical-align: bottom"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; vertical-align: bottom; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>FY
2013</b></font></td>
<td style="vertical-align: bottom"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: #ebebff">
<td style="width: 83%"><font style="font: 10pt Times New Roman, Times, Serif">Exercise price</font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 14%"><font style="font: 10pt Times New Roman, Times, Serif">2.25</font></td>
<td style="width: 2%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif">Expected dividends</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">%</font></td></tr>
<tr style="vertical-align: bottom; background-color: #ebebff">
<td><font style="font: 10pt Times New Roman, Times, Serif">Expected volatility</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">45.95-48.97</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">%</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif">Risk fee interest rate</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.72-1.42</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">%</font></td></tr>
<tr style="vertical-align: bottom; background-color: #ebebff">
<td><font style="font: 10pt Times New Roman, Times, Serif">Expected life</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">5 years</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif">Expected forfeiture</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">%</font></td></tr>
</table>
<table cellspacing="0" cellpadding="0" style="width: 100%; margin-top: 0px; font-size: 9pt">
<tr>
<td style="vertical-align: bottom"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="8" style="border-bottom: #000000 1px solid; vertical-align: bottom; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>March
31, 2015</b></font></td>
<td style="vertical-align: bottom; font-size: 8.5pt"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="8" style="border-bottom: #000000 1px solid; vertical-align: bottom; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>December
31, 2014</b></font></td></tr>
<tr style="vertical-align: bottom">
<td style="font-size: 8.5pt"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>Level
1</b></font></td>
<td style="font-size: 8.5pt"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>Level
2</b></font></td>
<td style="font-size: 8.5pt"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>Level
3</b></font></td>
<td style="font-size: 8.5pt"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>Level
1</b></font></td>
<td style="font-size: 8.5pt"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>Level
2</b></font></td>
<td style="font-size: 8.5pt"><font style="font: 9pt Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: #000000 1px solid; font-size: 8.5pt; text-align: center"><font style="font: 9pt Times New Roman, Times, Serif"><b>Level
3</b></font></td></tr>
<tr style="vertical-align: bottom; background-color: #ebebff">
<td style="width: 35%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; text-align: right; width: 9%"><font style="font: 10pt Times New Roman, Times, Serif">28,744</font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; text-align: right; width: 9%"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; text-align: right; width: 9%"><font style="font: 10pt Times New Roman, Times, Serif">0</font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; text-align: right; width: 9%"><font style="font: 10pt Times New Roman, Times, Serif">34,979</font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; text-align: right; width: 9%"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; text-align: right; width: 9%"><font style="font: 10pt Times New Roman, Times, Serif">152,849</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: #ebebff">
<td><font style="font: 10pt Times New Roman, Times, Serif">Beginning of period</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">34,979</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">152,849</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">108,228</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">471,015</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif">Additions</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td></tr>
<tr style="vertical-align: bottom; background-color: #ebebff">
<td><font style="font: 10pt Times New Roman, Times, Serif">Deletions</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(214,837)</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(115,881)</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif">Revisions</font></td>
<td style="border-bottom: #000000 1px solid"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(6,235)</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">61,988</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">42,632</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 1px solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(318,166)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #ebebff">
<td><font style="font: 10pt Times New Roman, Times, Serif">End of period</font></td>
<td style="border-bottom: #000000 3px double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">28,744</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">34,979</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: #000000 3px double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: #000000 3px double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">152,849</font></td></tr>
</table>
The predecessor company disposed of a dormant product line of vitamins in December 2010. As part of the consideration in this divestiture, the Company received from the purchaser of this product line an unsecured note in the amount of $170,000. The original note was due to be repaid on or before March 2014, where interest accrued principally at an annual rate of 5%, based upon the initial $170,000 principal and was payable monthly. As of March 31, 2013, the note was novated and a new promissory note was issued to reflect a modification in the payment terms, which includes no interest.
844543
2.25
0.00
0.00
0.00
0.4595
0.4897
0.0213
0.0171
0.0072
0.0241
0.019
0.0142
6.08-6.33 years
7.51-8.01 years
5 years
0.00
0.00
0.00
0.3522
0.4565
On January 7, 2015, Colorado Business Bank provided the Company with notice of a non-monetary event of default concerning the Company’s violation of the minimum tangible equity capital covenant set forth in the loan agreement. On March 27, 2015, and effective March 23, 2015, the Company and Colorado Business Bank (“CBB”) entered into a Change in Terms Agreement (the “Change in Terms Agreement) and Business Loan Agreement (the “Business Loan Agreement and, together with the Change in Terms Agreement, the “Agreements”), to replace that previous Business Loan Agreement, dated as of July 16, 2012, by and between iSatori, Inc. and CBB (the “Prior Agreement”).
Monthly
75000
214837
350000
770649
35400
33765
30985
214837
0
478
0
13368791