| Equity Transactions | Warrant Exercise In April 2017, the Company issued 200,000 shares
of common stock upon the exercise of 200,000 Class L Warrants to purchase shares of stock for $0.08 per share under the terms of
the Class L Warrant Public Offering agreement. The Company received proceeds of $16,000. On March 10, 2017, the Company issued 363,333
shares of common stock upon the exercise of 363,333 Class L Warrants to purchase shares of stock for $0.08 per share under the
terms of the Class L Warrant Public Offering agreement. The Company received proceeds of $29,067. On January 24, 2017, the Company issued 600,000
shares of common stock upon the exercise of 600,000 Class L Warrants to purchase shares of stock for $0.08 per share under the
terms of the Class L Warrant Public Offering agreement. The Company received proceeds of $48,000. On October 20, 2016, the Company issued 185,000
shares of common stock upon the exercise of 185,000 Class L Warrants to purchase shares of stock for $0.08 per share under the
terms of the Class L Warrant agreement. On October 14, 2016, the Company issued 258,333
shares of common stock upon the exercise of 258,333 Class L Warrants to purchase shares of stock for $0.08 per share under the
terms of the Class L Warrant agreement. On September 20, 2016, the Company issued 400,000
shares of common stock upon the exercise of 400,000 Class L Warrants to purchase shares of stock for $0.08 per share under the
terms of the Class L Warrant agreement. Cashless Warrant Exercise On June 22, 2017, the Company issued 84,514 shares
of common stock to Arthur Motch III upon the cashless exercise of 125,246 Series A Warrants to purchase shares of stock for $0.0334
per share based on a current market value of $0.1027 per share as determined under the terms of the Series A Warrant agreement. On March 13, 2017, the Company issued 297,035
shares of common stock to Lucas Hoppel upon the cashless exercise of 583,333 Class L Warrants to purchase shares of stock for $0.08
per share based on a current market value of $0.163 per share as determined under the terms of the Class L Warrant Private Offering
agreement. On February 6, 2017, the Company issued 80,804
shares of common stock to Intracoastal Capital, LLC upon the cashless exercise of 100,000 Series A Warrants to purchase shares
of stock for $0.0334 per share based on a current market value of $0.174 per share as determined under the terms of the Series
A Warrant agreement. On February 2, 2017, the Company issued 158,240
shares of common stock to Intracoastal Capital, LLC upon the cashless exercise of 200,000 Series A Warrants to purchase shares
of stock for $0.0334 per share based on a current market value of $0.17 per share as determined under the terms of the Series A
Warrant agreement. On January 26, 2017, the Company issued 79,998
shares of common stock to Intracoastal Capital, LLC upon the cashless exercise of 100,000 Series A Warrants to purchase shares
of stock for $0.0334 per share based on a current market value of $0.1669 per share as determined under the terms of the Series
A Warrant agreement. On January 20, 2017, the Company issued 15,951
shares of common stock to Intracoastal Capital, LLC upon the cashless exercise of 20,000 Series A Warrants to purchase shares of
stock for $0.0334 per share based on a current market value of $0.165 per share as determined under the terms of the Series A Warrant
agreement. On November 18, 2016, the Company issued 117,510
shares of common stock to DeMint Law, PLLC upon the cashless exercise of 143,400 Series A Warrants to purchase shares of stock
for $0.0334 per share based on a current market value of $0.185 per share as determined under the terms of the Series A Warrant
agreement. On September 8, 2016, the Company issued 526,288
shares of common stock to Vigere Capital LP upon the cashless exercise of 971,667 Class M Warrants to purchase shares of stock
for $0.06 per share based on a current market value of $0.11 per share as determined under the terms of the Class M Warrant agreement. On August 23, 2016, the Company issued 343,434
shares of common stock to JDF Capital, Inc. upon the cashless exercise of 971,667 Class M Warrants to purchase shares of stock
for $0.06 per share based on a current market value of $0.17 per share as determined under the terms of the Class M Warrant agreement. On August 23, 2016, the Company issued 1,640,589
shares of common stock to JDF Capital, Inc. upon the cashless exercise of 4,641,667 Class J Warrants to purchase shares of stock
for $0.06 per share based on a current market value of $0.17 per share as determined under the terms of the Class J Warrant agreement. 2016 Private Placement On August 11, 2016, the
Company began a private placement of securities (the “2016 Private Placement”) with select accredited investors in
reliance upon the exemption from securities registration afforded by Section 4(a)(2) of the Securities Act of 1933, as amended
(the “Securities Act”), an Rule 506 of Regulation D (“Regulation D”) as promulgated by the Securities and
Exchange Commission under the Securities Act. The 2016 Private Placement offered Units (the “Units”) at a purchase
price of $0.06 per Unit, with each Unit consisting of (i) one (1) share of Common Stock and, (ii) one (1) detachable warrant (the
“Warrants”) to purchase one (1) share of Common Stock at an exercise price of $0.08 per share. On August 25, 2016 and September
27, 2016 in conjunction with the 2016 Private Placement, the Company issued an aggregate of 22,766,667 and 5,533,334, respectively,
shares of common stock for an aggregate purchase price of $1,366,000 and $332,000, respectively. The Company, in connection
with the 2016 Private Placement, issued to the investors an aggregate of 28,300,001 warrants (the “Class L Warrants”)
to purchase shares of common stock at an exercise price of $0.08 per share. Each Class L Warrant represents the right to purchase
one share of Common Stock. The warrants vested upon issuance and expire on March 17, 2019. Pursuant to the terms of
a Registration Rights Agreement that the Company entered with the accredited investors in connection with the 2016 Private Placement,
the Company is required to file a registration statement that covers the shares of Common Stock and the shares of common stock
issuable upon exercise of the Warrants. The failure on the part of the Company to satisfy certain deadlines described in the Registration
Rights Agreement may subject the Company to payment of certain monetary penalties. Michael N. Nemelka, the
brother of a member of the Company’s board of directors and an existing shareholder of the Company, was a purchaser in the
2016 Private Placement of $75,000. A. Michael Stolarski, a member of the Company’s board of directors and an existing shareholder
of the Company, was a purchaser in the 2016 Private Placement of $60,000. At the closing of the 2016
Private Placement, the Company paid West Park Capital, Inc., the placement agent for the equity offering, cash compensation of
$169,800 based on the gross proceeds of the private placement and 2,830,000 Class L Warrants. Consulting Agreement In August 2016, the Company entered into a consulting
agreement for which the fee for the services performed was paid with Common Stock. The Company issued 435,392 shares of Common
Stock to Vigere Capital LP under this agreement. The fair value of the Common Stock issued to the consultant, based upon the closing
market price of the Common Stock at the date the Common Stock was issued, was recorded as a non-cash general and administrative
expense in the amount of $43,539 for the three months ended September 30, 2016. Convertible Debenture and Restricted Stock On July 29, 2016, the Company entered into a
financing transaction for the sale of a Convertible Debenture (the “Debenture”) in the principal amount of $200,000,
with gross proceeds of $175,000 to the Company after payment of a 10% original issue discount. The offering was conducted pursuant
to the exemption from registration provided by Section 4(a)(2) of the Act and Rule 506 of Regulation D thereunder. The Company
did not utilize any form of general solicitation or general advertising in connection with the offering. The Debenture was offered
and sold to one accredited investor (the “Investor”). The Investor is entitled to, at any time or from
time to time, commencing on the date that is one hundred fifty one (151) days from the Issuance Date set forth above convert the
Conversion Amount into Conversion Shares, at a conversion price for each share of Common Stock equal to either (i) if the Company
is Deposit/Withdrawal at Custodian (“DWAC”) Operational at the time of conversion, Seventy percent (70%) of the lowest
closing bid price (as reported by Bloomberg LP) of Common Stock for the twenty (20) Trading Days immediately preceding the date
of the date of conversion of the Debentures, or (ii) if either the Company is not DWAC Operational or the Common Stock is traded
on the bottom tier OTC Pink (or, “pink sheets”) at the time of conversion, Sixty Five percent (65%) of the lowest closing
bid price (as reported by Bloomberg LP) of the Common Stock for the twenty (20) Trading Days immediately preceding the date of
conversion of the Debentures, subject in each case to equitable adjustments resulting from any stock splits, stock dividends, recapitalizations
or similar events. The Company recorded $124,900 in interest expense
for the beneficial conversion feature of the debenture in December 2016. The Debenture is secured by the accounts receivable
of the Company and, unless earlier redeemed, matures on the third anniversary date of issuance. The Company paid a commitment fee
of $2,500 and issued 835,000 shares of Restricted Stock. The fair value of the Restricted Stock on the date of issuance was $0.06
and $50,100 was recorded as interest expense in July 2016. In September 2016, the Company repaid the Debenture
in full which totaled $210,000 with a Redemption Price of 105% of the sum of the Principal Amount per the agreement. The premium
of $10,000 paid upon redemption was recorded as interest expense in September 2016. 2016 Equity Offering On March 11, 2016, April
6, 2016, and April 15, 2016 in conjunction with an equity offering of securities (the “2016 Equity Offering”) with
select accredited investors, the Company issued an aggregate of 25,495,835, 3,083,334 and 1,437,501, respectively, shares of common
stock for an aggregate purchase price of $1,529,750, $185,000, and $86,200, respectively. The mandatory prepayment of principal
on the notes payable, related parties equal to 20% of the proceeds received by the Company was waived by HealthTronics, Inc. for
this 2016 Equity Offering. The Company, in connection
with the 2016 Equity Offering, issued to the investors an aggregate of 30,016,670 warrants (the “Class L Warrants”)
to purchase shares of common stock at an exercise price of $0.08 per share. Each Class L Warrant represents the right to purchase
one share of Common Stock. The warrants vested upon issuance and expire on March 17, 2019. Pursuant to the terms of
a Registration Rights Agreement that the Company entered into with the investors in connection with the 2016 Equity Offering, the
Company is required to file a registration statement that covers the shares of common stock and the shares of common stock issuable
upon exercise of the Class L Warrants. The registration statement was declared effective by the SEC on February 16, 2016. Michael N. Nemelka, the
brother of a member of the Company’s board of directors and an existing shareholder of the Company, was a purchaser in the
2016 Equity Offering of $100,000. A. Michael Stolarski, a member of the Company’s board of directors and an existing shareholder
of the Company, was a purchaser in the 2016 Equity Offering of $75,000. At the closing of the 2016
Equity Offering, the Company paid Newport Coast Securities, Inc., the placement agent for the equity offering, cash compensation
of $180,095 based on the gross proceeds of the private placement and 3,001,667 Class L Warrants. In addition, the Company
paid an escrow fee of $4,000 and an attorney fee of $20,000 from the gross proceeds. Series A Warrant Conversion On January 13, 2016, the
Company entered into an Exchange Agreement (the “Exchange Agreement”) with certain beneficial owners (the “Investors”)
of Series A warrants (the “Warrants”) to purchase shares of Common Stock, pursuant to which the Investors exchanged
(the “Exchange”) all of their respective Warrants for either (i) shares of Common Stock or (ii) shares of Common Stock
and shares of the Company’s Series B Convertible Preferred Stock, $0.001 par value (the “Preferred Stock”). The Exchange was based on
the following exchange ratio (the “Exchange Ratio”): 1 Series A Warrant = 0.4685 shares of capital stock. Investors
who, as a result of the Exchange, owned in excess of 9.99% (the “Ownership Threshold”) of the outstanding Common Stock,
received a mixture of Common Stock and shares of Preferred Stock. They received Common Stock up to the Ownership Threshold, and
received shares of Preferred Stock beyond the Ownership Threshold (but the total shares of Common Stock and Preferred Stock issued
to such holders was still based on the same Exchange Ratio). The relative rights, preferences, privileges and limitations of the
Preferred Stock are as set forth in the Company’s Certificate of Designation of Series B Convertible Preferred Stock, which
was filed with the Secretary of State of the State of Nevada on January 12, 2016 (the “Series B Certificate of Designation”). In the Exchange, an aggregate
number of 23,701,428 Warrants were exchanged for 7,447,954 shares of Common Stock and 293 shares of Preferred Stock. Pursuant to
the Series B Certificate of Designation, each of the Preferred Stock shares is convertible into shares of Common Stock at an initial
rate of 1 Preferred Stock share for 12,500 Common Stock shares, which conversion rate is subject to further adjustment as set forth
in the Series B Certificate of Designation. Pursuant to the terms of the Series B Certificate of Designation, the holders of the
Preferred Stock shares will generally be entitled to that number of votes as is equal to the number of shares of Common Stock into
which the Preferred Stock may be converted as of the record date of such vote or consent, subject to the Beneficial Ownership Limitation. In connection with entering
into the Exchange Agreement, the Company also entered into a Registration Rights Agreement, dated January 13, 2016, with the Investors.
The Registration Rights Agreement requires that the Company file with the SEC a registration statement to register for resale the
shares of the Common Stock issued in connection with the Exchange and the Common Stock issuable upon conversion of the Preferred
Stock shares (the “Preferred Stock Conversion Shares”). The registration statement was declared effective by the SEC
on February 16, 2016. | Warrant Exercise On October 20, 2016, the Company issued
185,000 shares of common stock upon the exercise of 185,000 Class L Warrants to purchase shares of stock for $0.08 per share under
the terms of the Class L Warrant agreement. On October 14, 2016, the Company issued
258,333 shares of common stock upon the exercise of 258,333 Class L Warrants to purchase shares of stock for $0.08 per share under
the terms of the Class L Warrant agreement. On September 20, 2016, the Company
issued 400,000 shares of common stock upon the exercise of 400,000 Class L Warrants to purchase shares of stock for $0.08 per share
under the terms of the Class L Warrant agreement. Cashless Warrant Exercise On November 18, 2016, the Company issued
117,510 shares of common stock to DeMint Law, PLLC upon the cashless exercise of 143,400 Series A Warrants to purchase shares of
stock for $0.0334 per share based on a current market value of $0.185 per share as determined under the terms of the Series A Warrant
agreement. On September 8, 2016, the Company issued
526,288 shares of common stock to Vigere Capital LP upon the cashless exercise of 971,667 Class M Warrants to purchase shares of
stock for $0.06 per share based on a current market value of $0.11 per share as determined under the terms of the Class M Warrant
agreement. On August 23, 2016, the Company issued
343,434 shares of common stock to JDF Capital, Inc. upon the cashless exercise of 971,667 Class M Warrants to purchase shares of
stock for $0.06 per share based on a current market value of $0.17 per share as determined under the terms of the Class M Warrant
agreement. On August 23, 2016, the Company issued
1,640,589 shares of common stock to JDF Capital, Inc. upon the cashless exercise of 4,641,667 Class J Warrants to purchase shares
of stock for $0.06 per share based on a current market value of $0.17 per share as determined under the terms of the Class J Warrant
agreement. 2016 Private Placement On August 11, 2016, the Company began
a private placement of securities (the “2016 Private Placement”) with select accredited investors in reliance upon
the exemption from securities registration afforded by Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities
Act”), an Rule 506 of Regulation D (“Regulation D”) as promulgated by the United States Securities and Exchange
Commission (the “Commission”) under the Securities Act. The 2016 Private Placement offered Units (the “Units”)
at a purchase price of $0.06 per Unit, with each Unit consisting of (i) one (1) share of our common stock, $0.001 par value (the
“Common Stock”) and, (ii) one (1) detachable warrant (the “Warrants”) to purchase one (1) share of our
Common Stock at an exercise price of $0.08 per share. On August 25, 2016 and September 27,
2016 in conjunction with the 2016 Private Placement, the Company issued an aggregate of 22,766,667 and 5,533,334, respectively,
shares of common stock for an aggregate purchase price of $1,366,000 and $332,000, respectively. The Company, in connection with the
2016 Private Placement, issued to the investors an aggregate of 28,300,001 warrants (the “Class L Warrants”) to purchase
shares of common stock at an exercise price of $0.08 per share. Each Class L Warrant represents the right to purchase one share
of Common Stock. The warrants vested upon issuance and expire on March 17, 2019. Pursuant to the terms of a Registration
Rights Agreement that the Company entered with the accredited investors in connection with the 2016 Private Placement, the Company
is required to file a registration statement that covers the shares of Common Stock and the shares of common stock issuable upon
exercise of the Warrants. The failure on the part of the Company to satisfy certain deadlines described in the Registration Rights
Agreement may subject the Company to payment of certain monetary penalties. Michael N. Nemelka, the brother of
a member of the Company’s board of directors and an existing shareholder of the Company, was a purchaser in the 2016 Private
Placement of $75,000. A. Michael Stolarski, a member of the Company’s board of directors and an existing shareholder of the
Company, was a purchaser in the 2016 Private Placement of $60,000. At the closing of the 2016 Private
Placement, the Company paid West Park Capital, Inc., the placement agent for the equity offering, cash compensation of $169,800
based on the gross proceeds of the private placement and 2,830,000 Class L Warrants. Consulting Agreement In August 2016, the Company entered
into a consulting agreement for which the fee for the services performed was paid with Company common stock. The Company issued
435,392 shares of common stock to Vigere Capital LP under this agreement. The fair value of the common stock issued to the consultant,
based upon the closing market price of the Company’s common stock at the date the common stock was issued, was recorded as
a non-cash general and administrative expense for the year ended December 31, 2016. Convertible Debenture and Restricted
Stock On July 29, 2016, the Company entered
into a financing transaction for the sale of a Convertible Debenture (the “Debenture”) in the principal amount of $200,000,
with gross proceeds of $175,000 to the Company after payment of a 10% original issue discount. The offering was conducted pursuant
to the exemption from registration provided by Section 4(a)(2) of the Act and Rule 506 of Regulation D thereunder. The Company
did not utilize any form of general solicitation or general advertising in connection with the offering. The Debenture was offered
and sold to one accredited investor (the “Investor”). The Investor is entitled to, at any
time or from time to time, commencing on the date that is one hundred fifty one (151) days from the Issuance Date set forth above
convert the Conversion Amount into Conversion Shares, at a conversion price for each share of Common Stock equal to either (i)
if the Company is Deposit/Withdrawal at Custodian (“DWAC”) Operational at the time of conversion, Seventy percent (70%)
of the lowest closing bid price (as reported by Bloomberg LP) of Common Stock for the twenty (20) Trading Days immediately preceding
the date of the date of conversion of the Debentures, or (ii) if either the Company is not DWAC Operational or the Common Stock
is traded on the bottom tier OTC Pink (or, “pink sheets”) at the time of conversion, Sixty Five percent (65%) of the
lowest closing bid price (as reported by Bloomberg LP) of the Common Stock for the twenty (20) Trading Days immediately preceding
the date of conversion of the Debentures, subject in each case to equitable adjustments resulting from any stock splits, stock
dividends, recapitalizations or similar events. The Company recorded $124,900 in interest
expense for the beneficial conversion feature of the debenture. The Debenture is secured by the accounts
receivable of the Company and, unless earlier redeemed, matures on the third anniversary date of issuance. The Company paid a commitment
fee of of $2,500.00) and issued 835,000 shares of Restricted Stock. The fair value of the Restricted Stock on the date of issuance
was $0.06 and $50,100 was recorded as interest expense. In September 2016, the Company repaid
the Debenture in full which totaled $210,000 with a Redemption Price of 105% of the sum of the Principal Amount per the agreement.
The premium of $10,000 paid upon redemption was recorded as interest expense. 2016 Equity Offering On March 11, 2016, April 6, 2016, and
April 15, 2016 in conjunction with an equity offering of securities (the “2016 Equity Offering”) with select accredited
investors, the Company issued an aggregate of 25,495,835, 3,083,334 and 1,437,501, respectively, shares of common stock for an
aggregate purchase price of $1,529,750, $185,000, and $86,200, respectively. The mandatory prepayment of principal on the Notes
payable, related parties equal to 20% of the proceeds received by the Company required by the Note Amendment on June 15, 2015 was
waived by HealthTronics, Inc. for this 2016 Equity Offering. The Company, in connection with the
2016 Equity Offering, issued to the investors an aggregate of 30,016,670 warrants (the “Class L Warrants”) to purchase
shares of common stock at an exercise price of $0.08 per share. Each Class L Warrant represents the right to purchase one share
of Common Stock. The warrants vested upon issuance and expire on March 17, 2019. Pursuant to the terms of a Registration
Rights Agreement that the Company entered into with the investors in connection with the 2016 Equity Offering, the Company is required
to file a registration statement that covers the shares of common stock and the shares of common stock issuable upon exercise of
the Class L Warrants. The registration statement was declared effective by the SEC on February 16, 2016. Michael N. Nemelka, the brother of
a member of the Company’s board of directors and an existing shareholder of the Company, was a purchaser in the 2016 Equity
Offering of $100,000. A. Michael Stolarski, a member of the Company’s board of directors and an existing shareholder of the
Company, was a purchaser in the 2016 Equity Offering of $75,000. At the closing of the 2016 Equity Offering,
the Company paid Newport Coast Securities, Inc., the placement agent for the equity offering, cash compensation of $180,095 based
on the gross proceeds of the private placement and 3,001,667 Class L Warrants. In addition, the Company paid an escrow fee
of $4,000 and an attorney fee of $20,000 from the gross proceeds. Series A Warrant Conversion On January 13, 2016, the Company entered
into an Exchange Agreement (the “Exchange Agreement”) with certain beneficial owners (the “Investors”)
of Series A warrants (the “Warrants”) to purchase shares of the Company’s common stock, $0.001 par value per
share (the “Common Stock”), pursuant to which the Investors exchanged (the “Exchange”) all of their respective
Warrants for either (i) shares of Common Stock or (ii) shares of Common Stock and shares of the Company’s Series B Convertible
Preferred Stock, $0.001 par value (the “Preferred Stock”). The Exchange was based on the following
exchange ratio (the “Exchange Ratio”): 1 Series A Warrant = 0.4685 shares of capital stock. Investors who, as a result
of the Exchange, owned in excess of 9.99% (the “Ownership Threshold”) of the outstanding Common Stock, received a mixture
of Common Stock and shares of Preferred Stock. They received Common Stock up to the Ownership Threshold, and received shares of
Preferred Stock beyond the Ownership Threshold (but the total shares of Common Stock and Preferred Stock issued to such holders
was still based on the same Exchange Ratio). The relative rights, preferences, privileges and limitations of the Preferred Stock
are as set forth in the Company’s Certificate of Designation of Series B Convertible Preferred Stock, which was filed with
the Secretary of State of the State of Nevada on January 12, 2016 (the “Series B Certificate of Designation”). In the Exchange an aggregate number
of 23,701,428 Warrants were exchanged for 7,447,954 shares of Common Stock and 293 shares of Preferred Stock. Pursuant to the Series
B Certificate of Designation, each of the Preferred Stock shares is convertible into shares of Common Stock at an initial rate
of 1 Preferred Stock share for 12,500 Common Stock shares, which conversion rate is subject to further adjustment as set forth
in the Series B Certificate of Designation. Pursuant to the terms of the Series B Certificate of Designation, the holders of the
Preferred Stock shares will generally be entitled to that number of votes as is equal to the number of shares of Common Stock into
which the Preferred Stock may be converted as of the record date of such vote or consent, subject to the Beneficial Ownership Limitation. In connection with entering into the
Exchange Agreement, the Company also entered into a Registration Rights Agreement, dated January 13, 2016, with the Investors.
The Registration Rights Agreement requires that the Company file with the SEC a registration statement to register for resale the
shares of the Common Stock issued in connection with the Exchange and the Common Stock issuable upon conversion of the Preferred
Stock shares (the “Preferred Stock Conversion Shares”). The registration statement was declared effective by the SEC
on February 16, 2016. |
