Annual report pursuant to Section 13 and 15(d)

CONSOLIDATED STATEMENTS OF CASH FLOWS

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CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)
 12 Months Ended
Sep. 30, 2015
Sep. 30, 2014
OPERATING ACTIVITIES:    
Net loss $ (14,712,285) $ (4,661,381)
Adjustments to reconcile net loss to net cash used in operating activities:    
Depreciation and amortization 1,047,752 490,256
Non-cash interest expense associated with convertible debt and warrants 2,198,003 423,968
Non-cash interest expense associated with loan fees 2,004,202 0
Non-cash change in fair value of derivative liability (83,580) (56,272)
Stock based compensation expense 712,538 167,985
Repricing of stock option exercise price 54,677 0
Writedown of assets 0 315,306
Non-cash issuance of common stock for services 2,016,059 9,654
Provision for uncollectible accounts 24,819 11,972
Reserve for obsolete inventory 255,110 0
Gain/Loss on disposal ofassets (104,966) 7,210
Impairment of intangible assets 3,713,472 0
Changes in assets and liabilities:    
Accounts receivable (152,040) (296,520)
Prepaid expenses and other current assets (124,550) (400,301)
Inventories 1,913,796 (2,984,031)
Deposits and other assets 29,071 1,204
Accounts payable (885,921) 1,444,820
Accrued liabilities 698,525 331,476
Income tax payable 376,000 0
Net cash used in operating activities (1,019,318) (5,194,654)
INVESTING ACTIVITIES:    
Acquisition of businesses, net of cash acquired (5,503,056) (1,259,483)
Expenditures for intangible assets (64,820) (19,265)
Proceeds from the sale of assets 153,500 1,400
Purchases of property and equipment (151,937) (79,808)
Net cash used in investing activities (5,566,313) (1,357,156)
FINANCING ACTIVITIES:    
Issuance of common stock for cash, net of issuance costs 538,441 13,681,054
Proceeds from notes payable 1,247,185 0
Payments on notes payable (1,886,859) (582,348)
Payment of preferred stock dividends 0 (17,267)
Contribution by noncontrolling interest 1,200,000 0
Proceeds from issuance of convertible debt 100,000 823,595
Net cash provided by financing activities 1,198,767 13,905,034
INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS (5,386,864) 7,353,224
CASH AND CASH EQUIVALENTS, beginning of period 8,114,682 761,458
CASH AND CASH EQUIVALENTS, end of period 2,727,818 8,114,682
Supplemental cash flow disclosures:    
Interest paid 24,312 754
Income taxes paid 0 0
Noncash financing and investing activities:    
Recognition of contingent beneficial conversion feature 100,000 500,000
Conversion of notes payable and accrued interest into common stock 635,756 0
Accrued and unpaid dividends $ 1,921 $ 1,925