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<p style="margin: 0pt"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 0"><font style="text-transform: uppercase">Note 1:	Nature of
Operations</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">TapImmune
Inc. (the “Company”), a Nevada corporation incorporated in 1992, is a clinical-stage immunotherapy specializing in
the development of innovative peptide and gene-based immunotherapeutics and vaccines for the treatment of oncology and infectious
disease. Unlike other vaccine technologies that narrowly address the initiation of an immune response, TapImmune's ("Prime"
and "Boost") approach broadly stimulates the cellular immune system by enhancing the function of killer T-cells and T-helper
cells and by restoring antigen presentation in tumor cells allowing their recognition and killing by the immune system. </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">A
Phase I study at the Mayo Clinic is currently evaluating the safety and immune responses of a set of proprietary HER2/neu antigens
that will be part of the "Prime" for a HER2/neu breast cancer vaccine.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">A
second Phase 1 trial is underway at the Mayo in Ovarian and breast cancer (Folate Alpha). Folate receptor alpha is expressed in
nearly 50% of breast cancers and in addition, over 95% of ovarian cancers, for which the only treatment options are surgery and
chemotherapy, leaving a very important and urgent clinical need for a new therapeutic. Time to recurrence is relatively short for
this type of cancer and survival prognosis is extremely poor after recurrence. In the USA alone, there are approximately 30,000
ovarian cancer patients newly diagnosed every year. These Folate Receptor Antigens are applicable to Ovarian and Triple Negative
Breast Cancer. Both of these diseases have few treatment options if any beyond surgery and chemotherapy and therefore the Company
is hopeful that it might be an ideal candidate for orphan drug status in these indications. </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">Phase
2 advancement will be assessed in late 2014. TapImmune has a exclusive option to license this set of peptides after successful
phase 1 trials.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
addition, enhancing the visibility of cancer or infected cells to a patient’s immune system is a critical aspect of an effective
vaccine. In this regard, TapImmune’s PolyStart nucleic acid-based technology provides a four-fold increase in target cell
specific naturally processed antigenic epitopes on a cells surface. This increased cell surface presentation corresponding increases
activated Helper and/or long-lived Killer T-cell populations that then effectively seek out and work to destroy a patient’s
cancer cells.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify; text-indent: 0.5in"><font style="letter-spacing: -0.1pt">The
Company is also exploiting the emerging field of vaccinomics for the development of vaccines applicable to a broad patient population.
TapImmune's immunotherapy technologies are also aimed at the prevention of emerging viral pathogens for pandemics and biodefense.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">These
consolidated financial statements have been prepared on the basis of a going concern which contemplates the realization of assets
and the satisfaction of liabilities in the normal course of business. As at December 31, 2013, the Company had a working capital
deficiency of $8,768,003 and has incurred significant losses since inception in the development of its business. Further losses
are anticipated in the development stage raising substantial doubt as to the Company’s ability to continue as a going concern.
The ability of the Company to continue as a going concern is dependent on raising additional capital to fund clinical trials, ongoing
research and development, maintenance and protection of patents, accommodation from certain debt obligations and ultimately on
generating future profitable operations. Planned expenditures relating to current and future clinical trials of the Company’s
immunotherapy vaccine will require significant additional funding. The Company is dependent on future financings to fund ongoing
research and development as well as working capital requirements. The Company’s future capital requirements will depend on
many factors including the rate and extent of scientific progress in its research and development programs, the timing, cost and
scope involved in clinical trials, obtaining regulatory approvals, pursuing further patent protections and the timing and costs
of commercialization activities.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">Management
is addressing going concern remediation through seeking new sources of capital, restructuring and retiring debt through conversion
to equity and debt settlement arrangements with creditors, cost reduction programs and seeking possible joint venture participation.
Management’s plans are intended to return the Company to financial stability and improve continuing operations. The Company
is continuing initiatives to raise capital through private placements, related party loans and other institutional sources to meet
immediate working capital requirements.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">Additional
funding was raised through equity and debt placements in 2012 and 2013, and in early 2014 the Company has completed significant
restructuring of outstanding debt and equity instruments into equity. Refer to Note 15, Subsequent Events. Additional capital is
required to expand programs including pre-clinical work and to progress clinical trials for the lead vaccine candidates. Strategic
partnerships will be needed to continue the product development portfolio and fund development costs. These measures, if successful,
may contribute to reduce the risk of going concern uncertainties for the Company over the next twelve months. </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">There
is no certainty that the Company will be able to arrange sufficient funding to satisfy current debt obligations or to continue
development of products to marketability.</font></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.75in"><font style="text-transform: uppercase"> </font></p>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"> </p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 0"><font style="text-transform: uppercase">Note 2:	SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES</font></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Basis of Presentation</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">These financial statements are presented
in United <font style="letter-spacing: -0.1pt">States</font> dollars and have been prepared in accordance with accounting principles
generally accepted in the United States of America.</p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Principles of Consolidation</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">These financial statements <font style="letter-spacing: -0.1pt">include</font>
the accounts of the Company and its wholly-owned subsidiaries GeneMax Pharmaceuticals Inc. (“GPI”) and GeneMax Pharmaceuticals
Canada Inc. (“GPC”). All significant intercompany balances and transactions are eliminated upon consolidation.</p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Use of Estimates</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">Preparation of the Company’s <font style="letter-spacing: -0.1pt">financial</font>
statements in conformity with accounting principles generally accepted in the United States of America requires management to make
estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ materially
from those estimates. Significant areas requiring management’s estimates and assumptions include deferred taxes and related
tax balances and disclosures, determining the fair value of stock-based compensation and stock based transactions, the fair value
of the components of the convertible notes payable, foreign exchange gains and losses, and accrued liabilities. Matters impacting
the company’s ability to continue as a going concern and contingencies also involve the use of estimates and assumptions.</p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Fair Value Measurements</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The objective of ASC 820, <i>Fair Value
Measurements and Disclosures</i>, is to increase consistency and comparability in fair value measurements and to expand disclosures
about fair value measurements. ASC 820 defines fair value, establishes a <font style="letter-spacing: -0.1pt">framework</font>
for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. ASC
820 applies under other accounting pronouncements that require or permit fair value measurements and does not require any new fair
value measurements.</p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Foreign Currency Translation</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The functional currency of the Company, including
its US subsidiary, is United States dollars. GPC maintains its accounting records in its local currency (Canadian dollar). In accordance
with ASC 830, <i>Foreign Currency Matters</i>, the financial statements of the Company's subsidiary is translated into United States
dollars using period end exchange rates for monetary assets and liabilities and average <font style="letter-spacing: -0.1pt">exchange</font>
rates over the period for revenues and expenses. Non-monetary assets are translated at their historical exchange rates. Exchange
gains or losses from such translations are included in accumulated comprehensive income (loss), as a separate component of stockholders'
equity.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">Net gains and losses resulting from foreign
currency exchange gains and losses on transactions occurring in a currency other than the Company's functional currency are included
in the determination of net income in the period.</p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Financial Instruments and Concentration of Credit Risk</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The fair values of cash, accounts payable,
and other current monetary liabilities approximate their carrying values due to the immediate or short-term <font style="letter-spacing: -0.1pt">maturity</font>
of these financial instruments. The Company's operations and financing activities are conducted primarily in United States dollars,
and as a result the Company is not subject to significant exposure to market risks from changes in foreign currency rates. U<font style="letter-spacing: -0.1pt">nless
otherwise noted, it is management's opinion that the Company is not exposed to significant interest or credit risks arising from
assets classified as financial instruments.</font></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Impairment of Long-Lived Assets</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">Long-lived assets are reviewed for impairment
whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. <font style="letter-spacing: -0.1pt">Circumstances</font>
which could trigger a review include, but are not limited to: significant decreases in the market price of the asset; significant
adverse changes in the business climate or legal factors; accumulation of costs significantly in excess of the amount originally
expected for the acquisition or construction of the asset; current period cash flow or operating losses combined with a history
of losses or a forecast of continuing losses associated with the use of the asset; and current expectation that the asset will
more likely than not be sold or disposed significantly before the end of its estimated useful life. Recoverability of these assets
is measured by comparison of carrying amounts to future undiscounted cash flows the assets are expected to generate. An impairment
loss is recognized when the carrying amount exceeds fair value.</p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Stock-Based Compensation</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The Company uses the Black-Scholes option-pricing
model to determine the grant date fair-value of stock-based awards under ASC 718, <i>Compensation – Stock Compensation</i>.
The fair value is recorded in income depending on the terms and conditions of the award, and the <font style="letter-spacing: -0.1pt">nature</font>
of the relationship of the recipient of the award to the Company. The Company records the grant date fair value in income in line
with the period over which it was earned. For employees and management this is typically considered to be the vesting period of
the award. For consultants the fair value of the award is recorded in income over the term of the service period, and unvested
amounts are revalued at each reporting period over the service period.</p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Deferred Financing Costs</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The Company defers direct costs incurred
in connection with the sale of common shares which are offset against the proceeds of the financing upon completion. Costs incurred
in connection with convertible loans payable are deferred and amortized as a financing cost over the term of the convertible loans.
Upon conversion of the loan, any unamortized amount of deferred financing costs will be charged to <font style="letter-spacing: -0.1pt">stockholders’</font>
equity as a cost of financing.</p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Research and Development Costs</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The Company has acquired <font style="letter-spacing: -0.1pt">development</font>
and marketing rights to certain technologies. The rights and licenses acquired are considered rights to unproven technology which
may not have alternate future uses and therefore, have been expensed as incurred as research and development costs.</p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Income Taxes</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The Company follows the liability method
of accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences
attributable to differences between the financial statement carrying amounts of assets and liabilities and their respective tax
balances. Potential deferred tax assets and liabilities are measured using enacted tax rates expected <font style="letter-spacing: -0.1pt">to</font>
apply to the taxable income in the years in which those differences are expected to be recovered or settled. The effect on potential
deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the date of enactment.
The Company recognizes deferred taxes on unrealized gains directly within other comprehensive income, and concurrently releases
part of the related valuation allowance resulting in nil impact within OCI or on the balance sheet. As at December 31, 2013, the
Company had net operating loss carry forwards; however, due to the uncertainty of realization, the Company has provided a full
valuation allowance for the potential deferred tax assets resulting from these loss carry forwards.</p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Derivative Warrant Liability</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The Company evaluates its convertible
debt, options, warrants or other contracts to determine if those contracts or embedded components of those contracts qualify as
derivatives to be separately accounted for in accordance with ASC 810-10-05-4 and 815-40. This accounting treatment requires that
the carrying amount of embedded derivatives be marked-to-market at each balance sheet date and carried at fair value. In the event
that the fair value is recorded as a liability, the change in fair value during the period is recorded in the Statement of Operations
as either income or expense. Upon conversion, exercise or modification to the terms of a derivative instrument, the instrument
is marked to fair value at the conversion date and then the related fair value is reclassified to equity.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">In circumstances where the embedded conversion
option in a convertible instrument is required to be bifurcated and there are also other embedded derivative instruments in the
convertible instrument that are required to be bifurcated, the bifurcated derivative instruments are accounted for as a single,
compound derivative instruments.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The classification of derivative instruments,
including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting
period. Equity instruments that are initially classified as equity that become subject to reclassification are reclassified to
liability at the fair value of the instrument on the reclassification date. Derivative instrument liabilities will be classified
in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument is expected
within 12 months of the balance sheet date.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">In evaluating the application of ASC
815-40, management must determine whether an instrument (or an embedded feature) is indexed to the Company’s own stock. ASC
815-40-15 provides that an entity should use a two-step approach to evaluate whether an equity-linked financial instrument (or
embedded feature) is indexed to its own stock, including evaluating the instrument’s contingent exercise and settlement provisions.
The application of ASC 815-40-15 has affected the accounting for (i) certain freestanding warrants that contain exercise price
adjustment features and (ii) convertible notes containing full-ratchet and anti-dilution protections (iii) certain free standing
warrants that contain contingently puttable cash settlement.</p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Fair Value of Financial Instruments</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The Company follows ASC paragraph 825-10-50-10
for disclosures about fair value of its financial instruments and ASC paragraph 820-10-35-37 to measure the fair value of its financial
instruments. 820-10-35-37 establishes a framework for measuring fair value pursuant to GAAP and expands disclosures about fair
value measurements. To increase consistency and comparability in fair value measurements and related disclosures, paragraph 820-10-35-37
further establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into
three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for
identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy are
described below:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">Level 1	Quoted market prices available
in active markets for identical assets or liabilities as of the reporting date.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0 1in; text-align: justify; text-indent: -1in">Level 2	Pricing
inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of
the reporting date.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">Level 3	Pricing inputs that are generally
observable inputs and not corroborated by market data.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The carrying amounts of the Company’s
financial assets and liabilities, such as cash, due from government agency, accounts payable and accrued liabilities, research
agreement obligations, and due to related parties, approximate their fair values because of their short term maturity. The Company’s
convertible notes payable approximate fair value based upon management’s estimate of comparable interest rates that would
be available to the Company for similar financial arrangements.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The Company revalues its derivative warrant
and derivative conversion option liabilities at each reporting period and recognizes gains or losses in the consolidated statements
of operations that are attributable to the change in the fair value.</p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Loss per Common Share</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">Basic loss per share is computed by dividing
loss attributable to common stockholders by the weighted average number of common shares outstanding for the period. If applicable,
diluted earnings per share reflect the potential dilution of securities that could share in the earnings (loss) of the Company.
The common shares potentially issuable on conversion of outstanding convertible debentures, warrants and stock options are anti-dilutive
and have not been included in the calculation.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0"><b>Recently Issued Accounting Pronouncements</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On April 1, 2012, the Company adopted new guidance
related to the presentation of comprehensive income. The main provisions of the new guidance provide that an entity that reports
items of other comprehensive income has the option to present comprehensive income as (i) a single statement that presents the
components of net income and total net income, the components of other comprehensive income and total other comprehensive income
and a total for comprehensive income or (ii) in two separate but consecutive statements, whereby an entity must present the components
of net income and total net income in the first statement and that statement is immediately followed by a financial statement that
presents the components of other comprehensive income, a total for other comprehensive income and a total for comprehensive income.
The new rules eliminate the option to present the components of other comprehensive income as part of the statement of stockholders'
equity. These new rules have been applied retrospectively and became effective for fiscal years, and interim periods within those
fiscal years, beginning on or after December 15, 2011 (January 1, 2012 for the Company), with early adoption permitted. The adoption
of this new guidance did not have a material impact on our Consolidated Financial Statements.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company has reviewed recently issued accounting
pronouncements and plans to adopt those that are applicable to it. It does not expect the adoption of these pronouncements
to have a material impact on its financial position, results of operations or cash flows.</p>
<p style="margin: 0pt"> </p>
<p style="margin: 0pt"> </p>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 0"><font style="text-transform: uppercase">Note 3:	Research
Agreements</font></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 12pt 0 0">Crucell Holland B.V. (“Crucell”) –
Research License and Option Agreement</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">Effective August 7, 2003, Crucell and
the Company’s subsidiary GPI entered into a five-year research license and option agreement. In addition, retroactively effective
August 7, 2008, the Company negotiated an amended license agreement for the use of Crucell’s adenovirus technology. The Company
was required to make annual license payments on the anniversary of the effective date for the three year term equal to €75,000
per annum for three years through December 2011. As at December 31, 2013, the Company accrued $492,365 (€378,384) under the
amended agreement, inclusive of interest on outstanding amounts.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The Company has not made use of the Crucell
technology in its current work and has not asked for nor received any work product. Management hopes to settle the outstanding
amounts with Crucell in 2014 and formally terminate the research license.</p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 12pt 0 0">Mayo Clinic –License Option Agreement</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">For details regarding the license option
agreement with Mayo Clinic, please refer to Note 12.</p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.75in"><font style="text-transform: uppercase"> </font></p>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 0"><font style="text-transform: uppercase">Note 4:	DERIVATIVE
WARRANT LIABILITY AND FAIR VALUE</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The Company has evaluated the application
ASC 480-10 <i>Distinguishing liabilities from equity</i>, ASC 815-40 <i>Contracts in an Entity’s Own Equity</i> and ASC 718-10
<i>Compensation – Stock Compensation</i> to the issued and outstanding warrants to purchase common stock that were issued
with the convertible notes, private placements, consulting agreements, and various debt settlements during 2009 through 2012. Based
on the guidance, management concluded these instruments are required to be accounted for as derivatives either due to a ratchet
down protection feature available on the exercise price (Note 5) or a holder’s right to put the warrants back to the Company
for cash under certain conditions or a conversion option feature with conversion into variable number of shares. Under ASC 815-40-25,
the Company records the fair value of these warrants and conversion options (derivatives) on its balance sheet, at fair value,
with changes in the values reflected in the statements of operations as “Changes in fair value of derivative liabilities”.
The fair value of the share purchase warrants are recorded on the balance sheet under ‘Derivative liability – warrants’
and the fair value of the conversion options are recorded on the balance sheet under ‘Derivative liability – conversion
option’.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">ASC 820-10 defines fair value as the
exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous
market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820-10 also
establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable
inputs when measuring fair value. ASC 820-10 describes three levels of inputs that may be used to measure fair value: Level 1 –
Quoted prices in active markets for identical assets or liabilities; Level 2 – Observable inputs other than Level 1 prices,
such as quoted prices for similar assets or liabilities; or other inputs that are observable or can be corroborated by observable
market data for substantially the full term of the assets or liabilities; and Level 3 – Unobservable inputs that are supported
by little or no market activity and that are financial instruments whose values are determined using pricing models, discounted
cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant
judgment or estimation. The Company’s Level 3 liabilities consist of the derivative liabilities associated with the warrants
and conversion options issued with the convertible notes during the year ended December 31, 2013. At December 31, 2013, all of
the Company’s derivative liabilities were categorized as Level 3 fair value liabilities. If the inputs used to measure the
financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level
input that is significant to the fair value measurement of the instrument.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><i>Level 3 Valuation Techniques</i></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">Financial liabilities are considered
Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and
at least one significant model assumption or input is unobservable. Level 3 financial liabilities consist of the notes and warrants
for which there is no current market for these securities such that the determination of fair value requires significant judgment
or estimation.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">Determining fair value of share purchase
warrants and conversion options, given the Company’s stage of development and financial position, is highly subjective and
identifying appropriate measurement criteria and models is subject to uncertainty. There are several generally accepted pricing
models for warrants and options and derivative provisions. The Company has chosen to value the warrants and conversion option on
the notes that contain ratchet down provisions using the Binomial model under the following assumptions:</p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: top">
<td style="border-bottom: windowtext 1pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify"> </td>
<td colspan="4" style="border-bottom: windowtext 1pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">December 31, 2012</td>
<td colspan="4" style="border-bottom: windowtext 1pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">December 31, 2013</td></tr>
<tr>
<td style="vertical-align: top; width: 26%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify"> </td>
<td style="vertical-align: bottom; width: 10%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Expected Life (Years)</td>
<td style="vertical-align: bottom; width: 10%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Risk free Rate</td>
<td style="vertical-align: bottom; width: 9%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Dividend yield</td>
<td style="vertical-align: bottom; width: 9%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Volatility</td>
<td style="vertical-align: bottom; width: 9%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Expected Life (Years)</td>
<td style="vertical-align: bottom; width: 9%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Risk free Rate</td>
<td style="vertical-align: bottom; width: 9%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Dividend yield</td>
<td style="vertical-align: bottom; width: 9%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Volatility</td></tr>
<tr style="vertical-align: top">
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify">Share purchase warrants</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">0.08 to 3.21</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">0.02% to 0.36%</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">0.00%</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">199%</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">0.85 to 2.78</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">0.13% to 0.78%</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">0.00%</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">199%</td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify; text-indent: 0.5in"> </p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: top">
<td style="border-bottom: windowtext 1pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify"> </td>
<td colspan="4" style="border-bottom: windowtext 1pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">December 31, 2012</td>
<td colspan="4" style="border-bottom: windowtext 1pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">December 31, 2013</td></tr>
<tr>
<td style="vertical-align: top; width: 24%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify"> </td>
<td style="vertical-align: bottom; width: 9%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Expected Life (Years)</td>
<td style="vertical-align: bottom; width: 9%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Risk free Rate</td>
<td style="vertical-align: bottom; width: 9%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Dividend yield</td>
<td style="vertical-align: bottom; width: 11%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Volatility</td>
<td style="vertical-align: bottom; width: 9%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Expected Life (Years)</td>
<td style="vertical-align: bottom; width: 9%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Risk free Rate</td>
<td style="vertical-align: bottom; width: 9%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Dividend yield</td>
<td style="vertical-align: bottom; width: 11%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Volatility</td></tr>
<tr style="vertical-align: top">
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify">Conversion option</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">0.003 to 0.89</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">0.05% to 0.19%</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">0.00%</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">100.88% to 141.21%</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">0.16 to 0.53</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">0.04% to 0.10%</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">0.00%</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">199% </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The foregoing assumptions are reviewed
quarterly and are subject to change based primarily on management’s assessment of the probability of the events described
occurring. Accordingly, changes to these assessments could materially affect the valuations.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><i>Financial Assets and Liabilities Measured
at Fair Value on a Recurring Basis</i></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">Financial assets and liabilities measured
at fair value on a recurring basis are summarized below and disclosed on the balance sheet under Derivative liability – warrants
and Derivative liability – conversion option:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify; text-indent: 0.5in"> </p>
<table cellspacing="0" cellpadding="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="border-top: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: left"> </td>
<td colspan="2" style="border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: left; text-indent: 0.5in"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: left"><b>As of December 31, 2013</b></p></td>
<td colspan="2" style="border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td colspan="2" style="border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="5" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><b>Fair Value Measurements </b></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p></td>
<td style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><b>Carrying Value</b></td>
<td colspan="2" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><b>Level 1</b></td>
<td colspan="2" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><b>Level 2</b></td>
<td style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><b>Level 3</b></td>
<td style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><b>Total</b></td></tr>
<tr>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt">Derivative liability - warrants</td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  140,504</td>
<td colspan="2" style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td colspan="2" style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  140,504</td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  140,504</td></tr>
<tr>
<td style="vertical-align: bottom; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Derivative liability – conversion option</td>
<td style="vertical-align: bottom; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">582,300</td>
<td colspan="2" style="vertical-align: top; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td colspan="2" style="vertical-align: bottom; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td style="vertical-align: bottom; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">582,300</td>
<td style="vertical-align: bottom; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">582,300</td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Total</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  722,804</td>
<td colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  722,804</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  722,804</td></tr>
<tr>
<td style="width: 36%"> </td>
<td style="width: 13%"> </td>
<td style="width: 11%"> </td>
<td style="width: 1%"> </td>
<td style="width: 12%"> </td>
<td style="width: 1%"> </td>
<td style="width: 13%"> </td>
<td style="width: 13%"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify; text-indent: 0.5in"> </p>
<table cellspacing="0" cellpadding="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<tr>
<td style="vertical-align: bottom; border-top: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: left"> </td>
<td colspan="3" style="vertical-align: bottom; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: left; text-indent: 0.5in"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>As of December 31, 2012 </b></p></td>
<td colspan="2" style="vertical-align: bottom; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="vertical-align: bottom; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="border-bottom: windowtext 0.5pt solid"> </td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="3" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><b>Fair Value Measurements Using</b></td>
<td colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p></td>
<td style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><b>Carrying Value</b></td>
<td style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><b>Level 1</b></td>
<td style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><b>Level 2</b></td>
<td style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><b>Level 3</b></td>
<td colspan="3" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><b>Total</b></td></tr>
<tr>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt">Derivative liability - warrants</td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  977,086</td>
<td style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  977,086</td>
<td colspan="3" style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  977,086</td></tr>
<tr>
<td style="vertical-align: bottom; border-bottom: windowtext 1pt solid; padding-right: -12.25pt; padding-left: 5.4pt">Derivative liability – conversion option</td>
<td style="vertical-align: bottom; border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">867,575</td>
<td style="vertical-align: top; border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td style="vertical-align: bottom; border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td style="vertical-align: bottom; border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">867,575</td>
<td colspan="3" style="vertical-align: bottom; border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">867,575</td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Total</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  1,844,661</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  1,844,661</td>
<td colspan="3" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  1,844,661</td></tr>
<tr>
<td style="width: 35%"> </td>
<td style="width: 11%"> </td>
<td style="width: 11%"> </td>
<td style="width: 12%"> </td>
<td style="width: 11%"> </td>
<td style="width: 1%"> </td>
<td style="width: 13%"> </td>
<td style="width: 6%"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0">The table below provides a summary of the changes in fair value,
including net transfers, in and/or out, of financial assets and liabilities measured at fair value on a recurring basis using significant
unobservable inputs (Level 3) during the years ended December 31, 2013 and 2012:</p>
<table cellspacing="0" cellpadding="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<tr style="vertical-align: top">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p></td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="3" style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><b>Fair Value Measurements Using Level 3 Inputs</b></td></tr>
<tr style="vertical-align: top">
<td colspan="2" style="border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in"> </p></td>
<td style="border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><b>Derivative liability - warrants</b></td>
<td style="border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><b>Derivative liability – conversion option</b></td>
<td style="border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><b>Total</b></td></tr>
<tr>
<td colspan="2" style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt">Balance,  December 31, 2011 </td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  1,317,834 </td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$                   -<font style="letter-spacing: -0.1pt"> </font></td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  1,317,834 </td></tr>
<tr>
<td colspan="2" style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt">Additions during the year</td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">300,000 </td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">737,700 </td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  1,037,700 </td></tr>
<tr style="vertical-align: bottom">
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt">Total unrealized (gains) or losses included in net loss</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">(597,127)</font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">129,875 </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">(467,252)</font></td></tr>
<tr style="vertical-align: bottom">
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt">Debt settlement</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(43,621)</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">- </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  (43,621)</td></tr>
<tr>
<td colspan="2" style="vertical-align: bottom; border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Transfers in and/or out of Level 3</td>
<td style="vertical-align: top; border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">- </td>
<td style="vertical-align: top; border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">- </td>
<td style="vertical-align: top; border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">- </td></tr>
<tr>
<td colspan="2" style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt">Balance,  December 31, 2012 </td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  977,086 </td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">               867,575<font style="letter-spacing: -0.1pt"> </font></td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">1,844,661 </td></tr>
<tr>
<td colspan="2" style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt">Additions during the year</td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">206,000 </td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">810,500 </td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  1,016,500 </td></tr>
<tr style="vertical-align: bottom">
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt">Total unrealized (gains) or losses included in net loss</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">(1,042,582)</font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(1,095,775)</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">(2,138,357)</font></td></tr>
<tr>
<td colspan="2" style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt">Transfers in and/or out of Level 3</td>
<td style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">- </td>
<td style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">- </td>
<td style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">- </td></tr>
<tr style="vertical-align: bottom">
<td style="width: 35%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Balance, December 31, 2013</td>
<td style="width: 13%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="width: 19%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$       140,504 </td>
<td style="width: 20%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$     582,300<font style="letter-spacing: -0.1pt"> </font></td>
<td style="width: 13%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$    722,804 </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The fair value of the warrants is determined
using a Binomial option pricing model. The valuation of warrants is subjective and is affected by changes in inputs to the valuation
model including the price per share of common stock, the historical volatility of the stock price, risk-free rates based on U.S.
Treasury security yields, the expected term of the warrants and dividend yield. Changes in these assumptions can materially affect
the fair value estimate. The Company could ultimately incur amounts to settle the warrant at a cash settlement value that is significantly
different than the carrying value of the liability on the financial statements. The Company will continue to classify the fair
value of the warrants as a liability until the warrants are exercised, expire, or are amended in a way that would no longer require
these warrants to be classified as a liability. Changes in the fair value of the common stock warrants liability are recognized
as a component of other income (expense) in the statement of operations.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The net cash settlement value at the
time of any future Fundamental Transaction will depend upon the value of the following inputs at that time: the consideration value
per share of the Company’s common stock, the volatility of the Company’s common stock, the remaining term of the warrant
from announcement date, the risk-free interest rate based on U.S. Treasury security yields, and the Company’s dividend yield.
The warrant requires use of a volatility assumption equal to the greater of 100% and the 100-day volatility function determined
as of the trading day immediately following announcement of a Fundamental Transaction. The fair value of the warrants is determined
using the American Binomial Option Pricing Model.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify; text-indent: 0.5in"> </p>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 0"><font style="text-transform: uppercase">Note 5:	CONVERTIBLE
NOTES PAYABLE</font></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td style="text-align: left"> </td><td style="font-weight: bold; padding-bottom: 1pt"> </td>
<td colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Face Value</td><td style="font-weight: bold; padding-bottom: 1pt"> </td>
<td colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Principal Repayment/ <br />Settlement/Re-issued</td><td style="font-weight: bold; padding-bottom: 1pt"> </td>
<td colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Unamortized <br />Note <br />Discount</td><td style="font-weight: bold; padding-bottom: 1pt"> </td>
<td colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Balance at <br />December 31, <br />2013</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; padding-left: 5.4pt">February 2011 Secured Convertible Notes</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="width: 40%; text-align: left; padding-left: 5.4pt">Senior Secured Notes, due February 24, 2014</td><td style="width: 3%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 10%; text-align: right">1,184,694</td><td style="width: 1%; text-align: left"> </td><td style="width: 3%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 10%; text-align: right">203,836</td><td style="width: 1%; text-align: left"> </td><td style="width: 3%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 10%; text-align: right">20,083</td><td style="width: 1%; text-align: left"> </td><td style="width: 3%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 10%; text-align: right">960,775</td><td style="width: 1%; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left; padding-left: 5.4pt">April 2011 Secured Convertible Notes</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; padding-left: 5.4pt">Senior Secured Notes, due April 4, 2014</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">215,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">8,835</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">206,165</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; padding-left: 5.4pt">June 2011 Secured Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left; padding-left: 5.4pt">Senior Secured Notes, due June 6, 2014</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">30,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">1,189</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">28,811</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt">August 8, 2012 Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt">Note due August 8, 2013</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">111,430</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">111,430</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt">August 12, 2012 Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt">Note became due November 12, 2012</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">27,500</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">27,500</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt">August 20, 2012 Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt">Note due August 20, 2013</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">20,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">20,000</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt">September 18, 2012 Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt">Note due October 1, 2013</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">82,500</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">82,500</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt">October 2012 Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt">Note due October 15, 2013</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">340,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">340,000</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt">October 9, 2012 Convertible Notes</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">100,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">100,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt">Note due April 30, 2013</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt">November 1, 2012 Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt">Note due April 30, 2013</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">31,471</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">31,471</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt">November 20, 2012 Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt">Note due November 20, 2013</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">55,710</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">44,962</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">10,748</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt">December 14, 2012 Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt">Note due April 18, 2013</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">189,210</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">189,210</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt">December 18, 2012 Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt">Note due December 14, 2013</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">50,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">50,000</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="font-weight: bold; padding-left: 5.4pt">January 5, 2013 Convertible Notes</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">567,729</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">115,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">452,729</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt">January 31, 2013 Convertible Notes</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">24,135</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">24,135</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="font-weight: bold; padding-left: 5.4pt">February 27, 2013 Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt">Note due February 27, 2014</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">58,500</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">8,819</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">49,681</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="font-weight: bold; padding-left: 5.4pt">April 2, 2013 Convertible Notes</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">80,967</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">80,967</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="font-weight: bold; padding-left: 5.4pt">April 18, 2013 Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt">Note due December 18, 2013</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">60,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">28,312</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">31,688</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="font-weight: bold; padding-left: 5.4pt">May 2, 2013 Convertible Notes</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">50,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">50,000</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="font-weight: bold; padding-left: 5.4pt">May 5, 2013 Convertible Notes</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">45,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">45,000</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="font-weight: bold; padding-left: 5.4pt">May 14, 2013 Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt">Note due May 14, 2014</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">126,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">46,258</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">79,742</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="font-weight: bold; padding-left: 5.4pt">June 27, 2013 Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt">Note due June 27, 2014</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">37,620</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">17,515</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">20,105</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="font-weight: bold; padding-left: 5.4pt">June 19, 2013 Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt">Note due June 19, 2014</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">115,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">83,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">8,217</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">23,783</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="font-weight: bold; padding-left: 5.4pt">July 12, 2013 Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt">Note due July 12, 2014</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">125,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">28,200</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">57,200</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">39,600</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="font-weight: bold; text-align: left; padding-left: 5.4pt">October, 2013 Convertible Notes</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left; padding-left: 5.4pt">Notes due in April, 2014</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">94,444</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">56,044</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">38,400</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="font-weight: bold; text-align: left; padding-left: 5.4pt">November, 2013 Convertible Notes</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; padding-left: 5.4pt">Notes due in May, 2014</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">80,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">52,996</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">27,004</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="font-weight: bold; text-align: left; padding-left: 5.4pt">December, 2013 Convertible Notes I</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left; padding-left: 5.4pt">Notes due May, 2014</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">277,222</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">258,478</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">18,744</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="font-weight: bold; text-align: left; padding-left: 5.4pt">December, 2013 Convertible Notes II</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; padding-left: 5.4pt">Notes due May, 2014</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">536,400</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">536,400</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-bottom: 1pt; padding-left: 5.4pt"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"> </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"> </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"> </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"> </td><td style="padding-bottom: 1pt; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="font-weight: bold; padding-bottom: 1pt; padding-left: 5.4pt">Total</td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td><td style="border-bottom: Black 1pt solid; text-align: right">4,715,532</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td><td style="border-bottom: Black 1pt solid; text-align: right">1,017,921</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td><td style="border-bottom: Black 1pt solid; text-align: right">535,634</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td><td style="border-bottom: Black 1pt solid; text-align: right">3,161,977</td><td style="padding-bottom: 1pt; text-align: left"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify"><font style="letter-spacing: -0.1pt">The
following is a summary of debt instrument transactions that are relevant to the previous year:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify; text-indent: 0.5in"><font style="letter-spacing: -0.1pt"> </font></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td style="text-align: left"> </td><td style="font-weight: bold; padding-bottom: 1pt"> </td>
<td colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Face Value</td><td style="font-weight: bold; padding-bottom: 1pt"> </td>
<td colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Principal Repayment/ <br />Settlement</td><td style="font-weight: bold; padding-bottom: 1pt"> </td>
<td colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Unamortized <br />Note <br />Discount</td><td style="font-weight: bold; padding-bottom: 1pt"> </td>
<td colspan="3" style="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Balance at <br />December 31, <br />2012</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; padding-left: 5.4pt">February 2011 Secured Convertible Notes</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="width: 40%; text-align: left; padding-left: 5.4pt">Senior Secured Notes, due February 24, 2014</td><td style="width: 3%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 10%; text-align: right">1,184,694</td><td style="width: 1%; text-align: left"> </td><td style="width: 3%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 10%; text-align: right">203,836</td><td style="width: 1%; text-align: left"> </td><td style="width: 3%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 10%; text-align: right">153,358</td><td style="width: 1%; text-align: left"> </td><td style="width: 3%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 10%; text-align: right">827,500</td><td style="width: 1%; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left; padding-left: 5.4pt">April 2011 Secured Convertible Notes</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; padding-left: 5.4pt">Senior Secured Notes, due April 4, 2014</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">215,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">43,140</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">171,860</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; padding-left: 5.4pt">June 2011 Secured Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left; padding-left: 5.4pt">Senior Secured Notes, due June 6, 2014</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">30,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">3,953</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">26,047</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt">August 8, 2012 Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt">Note due August 8, 2013</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">111,430</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">67,163</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">44,267</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt">August 12, 2012 Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt">Note became due November 12, 2012</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">27,500</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">27,500</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt">August 20, 2012 Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt">Note due August 20, 2013</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">20,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">12,712</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">7,288</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt">September 18, 2012 Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt">Note due October 1, 2013</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">82,500</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">59,741</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">22,759</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt">October 9, 2012 Convertible Notes</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt">Note due April 30, 2013</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">100,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">100,000</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt">October 2012 Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt">Note due October 15, 2013</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">340,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">268,275</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">71,725</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt">November 1, 2012 Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt">Note due April 30, 2013</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">31,471</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">18,200</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">13,271</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt">November 20, 2012 Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt">Note due November 20, 2013</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">55,710</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">49,605</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">6,105</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt">December 14, 2012 Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt">Note due April 18, 2013</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">189,210</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">81,302</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">107,908</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-left: 5.4pt"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-left: 5.4pt">December 18, 2012 Convertible Note</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-bottom: 1pt; padding-left: 5.4pt">Note due December 14, 2013</td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">50,000</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">—  </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">—  </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">50,000</td><td style="padding-bottom: 1pt; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-bottom: 1pt; padding-left: 5.4pt">Total</td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td><td style="border-bottom: Black 1pt solid; text-align: right">2,437,515</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td><td style="border-bottom: Black 1pt solid; text-align: right">203,836</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td><td style="border-bottom: Black 1pt solid; text-align: right">757,449</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td><td style="border-bottom: Black 1pt solid; text-align: right">1,476,230</td><td style="padding-bottom: 1pt; text-align: left"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>February 2011 Secured Convertible Notes</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On February 24, 2011, the Company entered
into a securities purchase agreement with accredited investors to place Senior Secured Convertible Notes (the “February 2011
Notes”) with a maturity date of three years after the issuance thereof in the aggregate principal amount of $1,184,694. Consideration
under the notes consisted of $944,694 in cash proceeds, including accrued interest.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The February 2011 Notes bear interest
at the rate of 10% per annum except in case of default, in which case they bear interest at the rate of 20% per annum. The Company
paid a finders’ fee of $41,500 on the notes.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">In connection with the issuance of the
February 2011 Notes, the Company issued 23,694 warrants, exercisable into common stock at $25.00 with five year terms.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">The Company has allocated the net proceeds
to the warrants based on the calculated fair value at the date of issuance. The fair value of the warrants was recorded at $483,355
and recognized as derivative liabilities and the debt was recorded at $701,339. The fair value of the warrants was calculated using
the Binomial option pricing model under the following assumptions: estimated life of five years, risk free rate of 2.06%, dividend
yield of 0% and volatility of 199%. The debt discount is being accreted over the three year term of the February 2011 Notes using
the effective interest rate method.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">During the year ended December 31, 2012,
one of the investors settled the principal amount of $203,836 and accrued interest of $16,419 of the February 2011 Notes in exchange
for December 14, 2012 Convertible Note (the “December 14, 2012 Note”).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><b>April 2011 Secured Convertible Notes</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On April 4, 2011, the Company entered
into a securities purchase agreement with accredited investors to place Senior Secured Convertible Notes (the “April 2011
Notes”) with a maturity date of three years after the issuance thereof in the aggregate principal amount of $215,000. Consideration
under the notes consisted of $190,000 in cash proceeds, and $25,000 was subscribed for by a holder of 2010 Notes in exchange for
the extinguishment of warrants related to the 2010 Notes.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The April 2011 Notes bear interest at
the rate of 10% per annum except in case of default, in which case they bear interest at the rate of 20% per annum. The Company
paid a finders’ fee of $4,550.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">In connection with the issuance of the
April 2011 Notes, the Company issued 4,300 warrants, exercisable into common stock at $25.00 with 2 year terms.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">The Company has allocated the net proceeds
to the warrants based on the calculated fair value. The fair value of the warrants was recorded at $130,720 and recognized as derivative
liabilities and the debt was recorded at $84,280. The fair value of the warrants was calculated using the Binomial option pricing
model under the following assumptions: estimated life of two years, risk free rate of 0.77%, dividend yield of 0% and volatility
of 199%. The debt discount is being accreted over the three year term of the April 2011 Notes using the effective interest rate
method.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><b>June 2011 Secured Convertible Note</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On June 6, 2011, the Company entered
into a securities purchase agreement with accredited investors to place Senior Secured Convertible Note (the “June 2011 Note”)
with a maturity date of three years after the issuance thereof in the aggregate principal amount of $30,000.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The June 2011 Note bears interest at
the rate of 10% per annum except in case of default, in which case it bears interest at the rate of 20% per annum. In connection
with the issuance of the June 2011 Note, the Company issued 600 warrants, exercisable into common stock at $25.00 with two year
terms.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">The Company has allocated the net proceeds
to the warrants based on the calculated fair value. The fair value of the warrants was recorded at $8,280 and recognized as derivative
liabilities and the debt was recorded at $21,720. The fair value of the warrants was calculated using the Binomial option pricing
model under the following assumptions: estimated life of two years, risk free rate of 0.43%, dividend yield of 0% and volatility
of 199%. The debt discount is being accreted over the three year term of the June 2011 Note using the effective interest rate method.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><b>August 8, 2012 Convertible Note</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On August 8, 2012, the Company entered
into a securities purchase agreement with accredited investors to place a Convertible Note (the “August 8, 2012 Note”)
with a maturity date of one year after the issuance thereof in the aggregate principal amount of $111,430. Consideration under
the notes consisted of $92,000 in cash proceeds after $8,000 payment of finders’ fee and an original issue discount of $11,430.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">The Company allocated the net proceeds to the conversion option based on the calculated fair value. The fair value of the
conversion option was recorded at $100,000 and recognized as a derivative liability and the debt was recorded at $nil. The
fair value of the conversion option was calculated using the Binomial option pricing model under the following assumptions:
estimated life of one year, risk free rate of 0.19%, dividend yield of 0% and volatility of 139.77%. The debt discount was
being accreted over the one year term of the August 8, 2012 Note using the effective interest rate method.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">During the year ended December 31, 2013,
the investor converted the principal amount of $111,430 and accrued interest of the August 8, 2012 Note into common shares (Note
9).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><b>August 12, 2012 Convertible Note</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On August 12, 2012, the Company entered
into a securities purchase agreement with accredited investors to place a Convertible Note (the “August 12, 2012 Note”)
with a maturity date of three months after the issuance thereof in the aggregate principal amount of $27,500. Consideration under
the notes consisted of $25,000 in cash proceeds after an original issue discount of $2,500. The agreement provides for the Company
to issue 500 shares to the note holder as risk premium. The 500 shares were valued at $6,250 and recorded as loss on debt financing
and obligation to issue shares. The August 12, 2012 Note bears interest at the rate of 10% per annum.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">The Company allocated the net proceeds
to the conversion option based on the calculated fair value. The fair value of the conversion option was recorded at $31,100 and
recognized as a derivative liability and the debt was recorded at $nil. The transaction resulted in an accounting loss on debt
financing of $6,100. The fair value of the conversion option was calculated using the Binomial option pricing model under the following
assumptions: estimated life of three months, risk free rate of 0.11%, dividend yield of 0% and volatility of 138.31%. The debt
discount was accreted over the three month term of the August 12, 2012 Note using the effective interest rate method.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><b>August 20, 2012 Convertible Note</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On August 20, 2012, the Company entered
into a securities purchase agreement with accredited investors to place a Convertible Note (the “August 20, 2012 Note”)
with a maturity date of one year after the issuance thereof in the aggregate principal amount of $20,000. The August 20, 2012 Note
bears interest at the rate of 8% per annum.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">The Company allocated the net proceeds
to the conversion option based on the calculated fair value. The fair value of the conversion option was recorded at $36,100 and
recognized as a derivative liability and the debt was recorded at $nil. The transaction resulted in an accounting loss on debt
financing of $16,100. The fair value of the conversion option was calculated using the Binomial option pricing model under the
following assumptions: estimated life of one year, risk free rate of 0.19%, dividend yield of 0% and volatility of 140.11%. The
debt discount is being accreted over the one year term of the August 20, 2012 Note using the effective interest rate method.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><b>September 18, 2012 Convertible Note</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On September 18, 2012, the Company entered
into a securities purchase agreement with accredited investors to place a Convertible Note (the “September 18, 2012 Note”)
with a maturity date of one year after the issuance thereof in the aggregate principal amount of $82,500. Consideration under the
notes consisted of $69,000 in cash proceeds after $6,000 payment of finders’ fee and an original issue discount of $7,500.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">The Company allocated the net proceeds to the conversion option based on the calculated fair value. The fair value of the
conversion option was recorded at $75,000 and recognized as a derivative liability and the debt was recorded at $nil. The
fair value of the conversion option was calculated using the Binomial option pricing model under the following assumptions:
estimated life of one year, risk free rate of 0.20%, dividend yield of 0% and volatility of 141.43%. The debt discount was
accreted over the one year term of the September, 2012 Note using the effective interest rate method</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">During the year ended December 31, 2013,
the investor converted the principal amount and accrued interest of $81,360 into common shares (Note 9). Of the balance of $24,990
remaining on the September 18, 2012 Note, the Company repaid $20,000 in full settlement and recognized $4,990 as gain on settlement
of debt .</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>October 2012 Convertible Note</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On October 15, 2012, the Company entered
into a securities purchase agreement with an accredited investor to place a Convertible Note (the “October 2012 Note”)
with a maturity date of one year after the issuance thereof in the aggregate principal amount of $340,000. Consideration under
the notes consisted of $310,000 in cash proceeds after $10,000 payment of legal fee and an original issue discount of $30,000.
The October 2012 Note carries an interest rate of 8%.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">As part of the agreement, the Company
also issued 30,000 warrants to the note holder exercisable at $25.00 per share expiring on October 31, 2016.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">The Company has allocated the net proceeds
to the conversion option and equity based on the calculated fair value. The fair value of the conversion option was recorded at
$248,000 and recognized as a derivative liability and the equity was recorded at $62,000. The fair value of the conversion option
was calculated using the Binomial option pricing model under the following assumptions: estimated life of one year, risk free rate
of 0.19%, dividend yield of 0% and volatility of 139.16%. The debt discount has being accreted over the one year term of the October
2012 Note using the effective interest rate method.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><b>October 9, 2012 Convertible Note</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On October 9, 2012, the Company converted
accounts payable of $100,000 into convertible notes (the “October 9, 2012 Note”). The note has no terms of repayment
and no interest charges. Only under certain events of default the note will incur an interest rate of 20% per year.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">During the year ended December 31, 2013,
the note was amended and assigned to a third party with price adjustment features ratified by the Company and converted into 53,690
shares of the Company. (Note 9).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><b>November 1, 2012 Convertible Note</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">During the year, the Company converted
a promissory note of $100,000 (Note 7) with an accredited investor into three convertible notes of $105,000 cumulatively. The three
convertible notes were assigned to a third party, of which, two notes were converted into equity. In November and December 2012,
the Note holder converted $73,737 of principal and interest into 12,627 shares. The fair value of the shares was determined to
be $140,538 based on the quoted market prices. (Note 9). The third Convertible Note (the “November 1, 2012 Note”) was issued with a maturity date of six months in the
aggregate principal amount of $31,471.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The November 1, 2012 Note bears interest
at the rate of 10% per annum starting on November 15, 2012. If the Company is in default under certain events, the November 1,
2012 Note shall incur interest at the rate of 20% per annum retroactively.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">The Company has allocated $31,471 of the
balance of the November 1, 2012 Note to the conversion option and debt based on the calculated fair value. The fair value of the
conversion option was recorded at $27,300 and recognized as a derivative liability and the debt was recorded at $4,171. The fair
value of the conversion option was calculated using the Binomial option pricing model under the following assumptions: estimated
life of 0.49 year, risk free rate of 0.09%, dividend yield of 0% and volatility of 127.26%. The debt discount is being accreted
over the 0.49 year term of the November 1, 2012 Note using the effective interest rate method.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">During the year ended December 31, 2013,
the investor converted the November 1, 2012 Note and accrued interest into 5,128 common shares (Note 9).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><b>November 20, 2012 Convertible Note</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On November 20, 2012, the Company entered
into a securities purchase agreement with an accredited investor to place a Convertible Note (the “November 20, 2012 Note”)
with a maturity date of one year after the issuance thereof in the aggregate principal amount of $55,710. Consideration under the
notes consisted of $50,000 in cash proceeds after $4,000 payment of finder’s fee and an original issue discount of $5,710.
A one-time interest of 5% was applied to the principal sum of the note as part of the agreement.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">The Company has allocated the net proceeds
to the conversion option based on the calculated fair value. The fair value of the conversion option was recorded at $50,000 and
recognized as a derivative liability and the debt was recorded at $nil. The fair value of the conversion option was calculated using the Binomial option pricing model under the
following assumptions: estimated life of one year, risk free rate of 0.16%, dividend yield of 0% and volatility of 134.71%. The
debt discount is being accreted over the one year term of the November 20, 2012 Note using the effective interest rate method.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><b>December 14, 2012 Convertible Note</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On December 14, 2012, the Company converted
part of the February 2011 Notes in the amount of $220,255 into a Convertible Note (the “December 14, 2012 Note”) with
a maturity date of four months after the issuance thereof in the aggregate principal amount of $252,280. Consideration under the
notes consisted of $220,255 from February 2011 Notes, $10,000 payment of legal fee and an original issue discount of $22,025. The
December 14, 2012 Note bears interest at the rate of 8% per annum. In the event of default under certain conditions, the interest
will accrue at the rate of 18% per annum.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">In December 2012, the December 14, 2012
Note was assigned to a third party and the Company paid the first installment of $65,032 consisting of principal and interest in
10,785 shares. The fair value of the shares was determined to be $96,523 based on the quoted market price of $9.00 per share. (Note 9).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">The Company has allocated $189,210 of the
balance of the December 14, 2012 Note to the conversion option and debt based on the calculated fair value. The fair value of the
conversion option was recorded at $94,100 and recognized as a derivative liability and the debt was recorded at $95,110. The fair
value of the conversion option was calculated using the Binomial option pricing model under the following assumptions: estimated
life of 0.35 year, risk free rate of 0.06%, dividend yield of 0% and volatility of 100.88%. The debt discount is being accreted
over the 0.45 year term of the December 14, 2012 Note using the effective interest rate method.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">During the year ended December 31, 2013,
the investor converted the remaining balance of the note and accrued interest of $189,210 on the December 14, 2012 Note into common
shares (Note 9).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><b>December 18, 2012 Convertible Note</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On December 18, 2012, the Company entered
into a securities purchase agreement with accredited investors to place convertible notes (the “December 18, 2012 Notes”)
with a maturity date of one year after the issuance thereof in the aggregate principal amount of $50,000. The December 18, 2012
Notes carry an interest rate of 9%, due and payable on the maturity date.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><b>January 5, 2013 Convertible Notes</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On January 5, 2013, the Company exchanged
amounts due to a consultant and related parties into convertible notes (the “January 5, 2013 Notes”) with no terms
of repayment and no interest charges in the aggregate principal amount of $567,729, of which, $330,000 is due to related parties.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">In July, 2013, the consultant assigned
$115,000 of the convertible note to a third party with amendments to adjustment of conversion price ratified by the Company. As
of December 31, 2013, $452,729 of the January 5, 2013 Notes is outstanding.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><b>January 31, 2013 Convertible Note</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On January 31, 2013, the Company converted
accounts payable of $24,134 into a convertible note (the “January 31, 2013 Note”) with a maturity date of sixteen months.
The note has no terms of repayment and no interest charges. The conversion of the note occurs under the following conditions:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On the date that Company files a certificate
of designation creating a class of Series A convertible preferred stock (“Series A Convertible Preferred Stock”) (i)
with voting rights per share equal to one thousand (1,000) shares of common stock at the rate of five shares of common stock (on
a post-reverse stock split basis) for each share of Series A Convertible Preferred Stock and (ii) that are automatically convertible
into common shares upon the occurrence of a 100:1 reverse stock split, the Company may convert the January 31, 2013 Note into shares
of Series A Convertible Preferred Stock at a conversion price of four dollars ($4) per share of Series A Convertible Preferred
Stock.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><b>February 27, 2013 Convertible Note</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On February 27, 2013, the Company entered
into a securities purchase agreement with an accredited investor to place a Convertible Note (the “February 27, 2013 Note”)
with a maturity date of one year after the issuance thereof in the aggregate principal amount of $58,500. Consideration under the
notes consisted of $46,000 in cash proceeds after $4,000 payment of finders’ fee and an original issue discount of $8,500.
The Company accrued a one-time interest of 5% as per the agreement.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">The Company has allocated the net proceeds
to the conversion option based on the calculated fair value. The fair value of the conversion option was recorded at $44,700 and
recognized as a derivative liability and the debt was recorded at $5,300. The fair value of the conversion option was calculated
using the Binomial option pricing model under the following assumptions: estimated life of one year, risk free rate of 0.17%, dividend
yield of 0% and volatility of 123.76%. The debt discount is being accreted over the one year term of the February 27, 2013 Note
using the effective interest rate method.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>April 2, 2013 Convertible Note</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On April 2, 2013, the Company
exchanged accounts payable into convertible notes (the “April 2, 2013 Note”) in the aggregate principal amount of
$80,967. The note holder has the option to convert a portion or all of the outstanding balance of the note into shares of the
Company’s common stock at a conversion rate of $7.00 per share. The note will incur an interest rate of 8% per year
unless the Company defaults under certain conditions, in which case, the note will incur an interest rate of 20% per
year.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify; text-indent: 0.5in"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><b>April 18, 2013 Convertible Note</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On April 18, 2013, the Company entered
into a securities purchase agreement with an accredited investor to place a Convertible Note (the “April 18, 2013 Note”)
with a maturity date of eight months after the issuance thereof in the aggregate principal amount of $60,000. Consideration under
the notes consisted of $50,000 in cash proceeds after $5,000 payment of transaction costs and an original issue discount of $5,000.
The April 18, 2013 Note carries an interest rate of 8% per year unless the note is in default under certain conditions, in which
case, the interest rate would be 18% per year.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">The Company has allocated the net proceeds
to the conversion option based on the calculated fair value. The fair value of the conversion option was recorded at $27,800 and
recognized as a derivative liability and the debt was recorded at $27,200. The fair value of the conversion option was calculated
using the Binomial option pricing model under the following assumptions: estimated life of eight months, risk free rate of 0.10%,
dividend yield of 0% and volatility of 115.82%. The debt discount is being accreted over the eight month term of the April 18,
2013 Note using the effective interest rate method.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">During the year ended December 31, 2013,
the investor converted $31,733, part of the principal and accrued interest on the April 18, 2013 Note, into common shares (Note
9).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><b>May 2, 2013 Convertible Notes</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On May 2, 2013, the Company issued convertible
notes (the “May 2, 2013 Note”) in the aggregate principal amount of $50,000. The note matures on May 31, 2014 and would
only start to accrue interest of 10% per year after February 15, 2014. The note is automatically convertible into Series B convertible
preferred shares (‘Series B Preferred Shares”) when the Company enacts a 100:1 reverse stock split, where each of the
Series B Preferred Shares are convertible at the rate of seven shares of common stock (Note 15).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><b>May 5, 2013 Convertible Note</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On May 5, 2013, the Company exchanged
accounts payable into convertible notes (the “May 5, 2013 Note”) in the aggregate principal amount of $45,000. The
note holder has the option to convert a portion or all of the outstanding balance of the May 5, 2013 Note into shares of the Company’s
common stock at a conversion rate of $7.00 per share. The note will incur an interest rate of 8% per year unless the Company defaults
under certain conditions, in which case, the note will incur an interest rate of 20% per year.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><b>May 14, 2013 Convertible Note</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On May 14, 2013, the Company entered
into a securities purchase agreement with an accredited investor to place a Convertible Note (the “May 14, 2013 Note”)
with a maturity date of one year after the issuance thereof in the aggregate principal amount of $126,000. The Company also issued
20,000 warrants to the note holder, exercisable at $6.00 per share with a four year term. Consideration under the notes consisted
of $110,000 in cash proceeds after $5,000 payment of finders’ fee and an original issue discount of $11,000.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The May 14, 2013 Note carries an interest
rate of 8% per year unless the note is in default, in which case, the note will incur an interest rate of 18% per year.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify"><font style="font-size: 10pt">The Company
has allocated the net proceeds to the conversion option and warrants based on the calculated fair values. The fair value of the
conversion option was recorded at $62,678,000 and fair value of the warrants was recorded as $52,322 recognized as a derivative
liabilities and the debt was recorded at $nil. The fair value of the conversion option was calculated using the Black Scholes
option pricing model under the following assumptions: estimated life of four years, risk free rate of 0.4%, dividend yield of
0% and volatility of 161%. The debt discount is being accreted over the one year term of the May 14, 2013 Note using the effective
interest rate method.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify"><b>June 27, 2013 Convertible Note</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On June 27, 2013, the Company entered
into a securities purchase agreement with an accredited investor to place a Convertible Note (the “June 27, 2013 Note”)
with a maturity date of one year after the issuance thereof in the aggregate principal amount of $37,620. Consideration under the
notes consisted of $30,000 in cash proceeds after $3,000 payment of finder’s fee and an original issue discount of $4,620.
The Company accrued a one-time interest of 5% as per the agreement.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">The Company has allocated the net proceeds
to the conversion option based on the calculated fair value. The fair value of the conversion option was recorded at $30,200 and
recognized as a derivative liability and the debt was recorded at $2,800. The fair value of the conversion option was calculated
using the Binomial option pricing model under the following assumptions: estimated life of one year, risk free rate of 0.15%, dividend
yield of 0% and volatility of 156.41%. The debt discount is being accreted over the one year term of the June 27, 2013 Note using
the effective interest rate method.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>June 19, 2013 Convertible Note</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">In June, 2013, a consultant assigned
$115,000 of its convertible note to a third party with amendments ratified by the Company (the “June 19, 2013 Note”)
with a maturity date of one year after the issuance thereof in the aggregate principal amount of $115,000.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The June 19, 2013 Note carries an interest
rate of 10% per year unless the note is in default under certain conditions, in which case, the interest rate would be 20% per
year.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">The Company has allocated the net proceeds
to the conversion option based on the calculated fair value. The fair value of the conversion option was recorded at $31,600 and
recognized as a derivative liability and the debt was recorded at $83,400. The fair value of the conversion option was calculated
using the Binomial option pricing model under the following assumptions: estimated life of one year, risk free rate of 0.15%, dividend
yield of 0% and volatility of 156.46%. The debt discount is being accreted over the one year term of the June 19, 2013 Note using
the effective interest rate method.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">During the year ended December 31, 2013,
the third party converted the principal amount of $83,000 and accrued interest of the June 19, 2013 Note into 108,188 common shares
(Note 9).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><b>July 12, 2013 Convertible Note</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">In July, 2013, the Company entered into
a securities purchase agreement with an accredited investor to place a Convertible Note (the “July 12, 2013 Note”)
with a maturity date of one year after the issuance thereof in the aggregate principal amount of $125,000. The Company also issued
41,667 warrants to the note holder, exercisable at $3.00 per share with a five year term. Consideration under the notes consisted
of $110,000 in cash proceeds after $15,000 payment of finders’ fee and an original issue discount of $11,000.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The July 12, 2013 Note carries an interest
rate of 8% per year unless the note is in default, in which case, the note will incur an interest rate of 18% per year.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"></p>
<p style="text-align: justify"><font style="font-size: 10pt">The Company has allocated the net proceeds to the conversion
option and warrants based on the calculated fair values. The fair value of the conversion option was recorded at $59,615 and
fair value of the warrants was recorded as $54.385 recognized as a derivative liabilities and the debt was recorded at $nil.
The fair value of the conversion option was calculated using the Binomial option pricing model under the following
assumptions: estimated life of five year, risk free rate of 1.4%, dividend yield of 0% and volatility of 199%. The debt
discount is being accreted over the one year term of the July 12, 2013 Note using the effective interest rate
method.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">During the year ended December 31, 2013,
the investor converted the principal amount and accrued interest of $28,200 of the July 12, 2013 Note into 50,000 common shares
(Note 9).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><b>October, 2013 Convertible Notes</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"></p>
<p style="text-align: justify"><font style="font-size: 10pt">In October, 2013, the Company entered into securities purchase agreements
with accredited investors to place Convertible Notes (the “October, 2013 Notes”) with a maturity date of six months
after the issuance thereof in the aggregate principal amount of $55,000.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The October, 2013 Notes carry no interest
charges unless the note is in default, in which case, the note will incur an interest
rate of 20% per year.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">The Company has allocated the net proceeds
to the conversion option based on the calculated fair value. The full value was recorded as the fair value of the conversion
option and the debt was recorded at $nil. The fair value of the conversion option was calculated using the Binomial option pricing
model under the following assumptions: estimated life of six months, risk free rate of 0.10%, dividend yield of 0% and volatility
of 199%. The debt discount is being accreted over the six month term of the October, 2013 Notes using the effective interest rate
method.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><b>November, 2013 Convertible Notes</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"></p>
<p style="text-align: justify"><font style="font-size: 10pt">In November, 2013, the Company entered into securities purchase agreements with accredited investors
to place Convertible Notes (the “November, 2013 Notes”) with a maturity date of six months after the issuance thereof
in the aggregate principal amount of $80,000. Consideration under the notes consisted of $77,000 in cash proceeds and an original
issue discount of $3,000.</font></p>
<p style="text-align: justify"><font style="font-size: 10pt">The November, 2013 Notes carry no interest charges other than an
original issue discount unless the note is in default, in which case, the note will incur an interest rate of 20% per year.</font></p>
<p style="text-align: justify"><font style="font-size: 10pt">The Company has allocated the net proceeds to the conversion option
based on the calculated fair value. The full value was recorded as the fair value of the conversion option and the debt was recorded
at $nil. The fair value of the conversion option was calculated using the Binomial option pricing model under the following assumptions:
estimated life of six months, risk free rates of 0.10% and 0.04%, dividend yield of 0% and volatility of 199%. The debt discount
is being accreted over the six month term of the November, 2013 Notes using the effective interest rate method.</font></p>
<p style="text-align: justify"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>December, 2013 Convertible Notes I</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">In December, 2013, the Company entered
into securities purchase agreements with accredited investors to place Convertible Notes (the “December, 2013 Notes I”)
with a maturity date of six months after the issuance thereof in the aggregate principal amount of $250,000. The December, 2013
Notes I carry no interest charges unless the note is in default, in which case, the note will incur an interest rate of 20% per
year.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">The Company has allocated the net proceeds
to the conversion option based on the calculated fair value. The full value was recorded as the fair value of the conversion option
and the debt was recorded at $nil. The fair value of the conversion option was calculated using the Binomial option pricing model
under the following assumptions: estimated life of six months, risk free rates of 0.10% , dividend yield of 0% and volatility of
199%. The debt discount is being accreted over the six month term of the December, 2013 Notes I using the effective interest rate
method.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><b>December, 2013 Convertible Notes II</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">In December, 2013, the Company entered
into securities purchase agreements with accredited investors to place Convertible Notes (the “December, 2013 Notes II”)
with a maturity date of six months after the issuance thereof in the aggregate principal amount of $536,400. Consideration under
the notes consisted of $141,000 of conversion of accounts payable, $267,950 of cash proceeds, of which $100,000 were received during
the year ended December 31, 2012 as subscription proceeds and $27,450 of interest costs. The conversion of the notes occurs under
the following conditions:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On the date that Company files a certificate
of designation creating a class of Series B Convertible Preferred Stock (i) with voting rights per share equal to one thousand
(1,000) shares of common stock and (ii) that are automatically convertible into common shares upon the occurrence of a 100:1 reverse
stock split at the rate of seven shares of common stock (on a post-reverse stock split basis) for each share of Series B Convertible
Preferred Stock, the Company may convert the December, 2013 Convertible Notes II into shares of Series B Convertible Preferred
Stock at a conversion price of one dollar per share of Series B Convertible Preferred Stock. If the Series B Convertible Preferred
Stock is duly authorized and outstanding, on the date that the Company enacts a 100:1 reverse stock split, the December, 2013 Convertible
Notes II will automatically convert into shares of Series B Convertible Preferred Stock at a conversion price of one dollar per
share of Series B Convertible Preferred Stock.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">Any amount of the December, 2013 Notes
II that are outstanding on February 15, 2014 will carry an interest rate of 10% per year.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">For the year ended December 31, 2013, the
Company recorded accretion of debt discount of $1,110,831 for the convertible notes.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">Subsequent to year ended December 31,
2013, the Company substantially converted all of the convertible debt into shares of common stock of the Company under a restructuring
plan (Note 15).<font style="text-transform: uppercase"> </font></p>
<p style="margin: 0pt"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 0"><font style="text-transform: uppercase">Note 6:	Loans payable</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">As at December 31, 2013, there were unsecured
loan advances in the amount of $42,200 (December 31, 2012 - $10,000) which are due on demand. $40,000 of the loans bear interest
of 10% per annum and $2,200 were advanced by the directors of the Company (Note 8).</p>
<p style="margin: 0pt"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="text-transform: uppercase"><b>Note 7:	Promissory
note</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">During the year ended December 31, 2012,
the Company issued promissory notes in the amount of $67,942, of which $38,000 of promissory notes were issued to an officer and
a director of the Company (Note 8). The promissory notes bear no interest charges and have no fixed repayment terms.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">During the year ended December 31, 2013,
the Company converted $210,000 of accounts payable into a promissory note, payable on a preset schedule of payments starting in
April 2013. Any of the late payments will incur interest at the rate of 9% per year. The Company had not made any payments and
is in default of the payment schedule. The payments in default are accruing interest of 9% per year. Subsequent to the year ended
December 31, 2013, the note holder converted outstanding principal and accrued interest into 1,400,000 post reverse stock split
common shares (Note 15).</p>
<p style="margin: 0pt"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 0"><font style="text-transform: uppercase">Note 8:	Related
Party Transactions</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">During
the y</font>ear ended December 31, 2013<font style="letter-spacing: -0.1pt">, the Company entered into transactions with certain
officers and directors of the Company as follows:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0 0.75in; text-align: justify; text-indent: -0.5in"><font style="letter-spacing: -0.1pt">(a)<font style="font: 7pt Times New Roman, Times, Serif">                
</font>incurred $366,500 (2012 - $391,600) in management, consulting and directors’ fees and $129,000 (2012 - $90,000) in
research and development services paid to officers and directors during the year;</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify; text-indent: 0.5in"><font style="letter-spacing: -0.1pt"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify; text-indent: -0.5in"><font style="letter-spacing: -0.1pt">(b)<font style="font: 7pt Times New Roman, Times, Serif">                
</font>recorded $46,988 (2012 - $124,209) in stock based compensation for the fair value of options granted to management that
were granted and or vested during the year;</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-indent: 0.5in"><font style="letter-spacing: -0.1pt"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify; text-indent: -0.5in"><font style="letter-spacing: -0.1pt">(c)<font style="font: 7pt Times New Roman, Times, Serif">                
</font>converted $nil (2012 - $50,000) of debt due to related parties during the year, which was settled with shares. </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-indent: 0.5in"><font style="letter-spacing: -0.1pt"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify; text-indent: -0.5in"><font style="letter-spacing: -0.1pt">(d)<font style="font: 7pt Times New Roman, Times, Serif">                
</font>issued $nil (2012 - $38,000) in promissory notes to an officer and director of the Company (Note 7).</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-indent: 0.5in"><font style="letter-spacing: -0.1pt"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify; text-indent: -0.5in"><font style="letter-spacing: -0.1pt">(e)<font style="font: 7pt Times New Roman, Times, Serif">                
</font>Borrowed $2,200 (2012 - $nil) as a loan from an officer and director of the Company (Note 6).</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">All
related party transactions (other than stock based compensation) involving provision of services were recorded at the exchange
amount, which is the amount established and agreed to by the related parties as representing fair value. The Company accounted
for the debt settlement transactions with related parties at management’s estimate of fair value, using amounts similar to
arm’s length settlements for debt settled.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">At
December 31, 2013, the Company had amounts owing to directors and officers of $369,345 (2012 - $373,346) in fees and $370,200 in
loans and other advances. Other than the loan amounting to $2,200 bearing 10% per year interest, all other amounts due to related
parties are unsecured, non-interest bearing and have no specific terms of repayment.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">Subsequent
to year ended December 31, 2013, the related parties settled </font>$613,845 of the debt for shares<font style="letter-spacing: -0.1pt">
of </font>common<font style="letter-spacing: -0.1pt"> stock of the Company (Note 15).</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-indent: 0.75in"><font style="text-transform: uppercase"> </font></p>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"> </p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 0"><font style="text-transform: uppercase">Note 9:	Capital
Stock</font></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 12pt 0 0">Share Capital</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">Prior
to March 27, 2007, the authorized capital of the Company consisted of 50,000,000 common shares with $0.001 par value and 5,000,000
non-voting preferred shares with $0.001 par value. On March 27, 2007, the Company’s Articles of Incorporation were amended
to increase the authorized shares of common stock from 50,000,000 shares of common stock to 200,000,000 shares. On June 28, 2007,
the Company completed a reverse stock split thereby issuing 1 new share for each 2.5 outstanding shares of the Company’s
common stock. Accordingly, the Company’s authorized share capital was decreased from 200,000,000 common shares to 80,000,000
common shares. On January 22, 2009 the authorized shares of common stock increased from 80,000,000 shares to 500,000,000 shares.</font>
Effective July 10, 2009, the Company executed a further 1 for 10 reverse stock split while simultaneously reducing the authorized
shares of common stock to 50,000,000 common shares with a $0.001 par value. Effective February 21, 2010, the Company increased
its authorized shares of common stock from 50,000,000 shares to 150,000,000 common shares. The Company maintained its authorized
shares of preferred stock at 5,000,000.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">Subsequent to the year ended December
31, 2013, on January 6, 2014, the Company designated 1,200,000 series A preferred shares (“Series A Convertible Preferred
Stock”). Each share of Series A Convertible Preferred Stock that is outstanding at the time that the Company enacts a 100
to 1 reverse stock split, the Series A Convertible Preferred Stock shall automatically convert into five shares of the Company’s
common stock on a post-split basis.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">Subsequent to the year ended December
31, 2013, on January 10, 2014, <font style="letter-spacing: -0.1pt">the Company completed a reverse stock split thereby issuing
1 new share for each 100 outstanding shares of the Company’s common stock</font> and amending the Company’s Articles
of Incorporation to increase the authorized shares of common stock from 150,000,000 shares of common stock to 500,000,000 shares
(Note 15).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">Also, on February 18, 2014, the Company’s
board of directors approved the creation of a class of up to 1,500,000 preferred stock, par value $0.001, called series B convertible
preferred stock (“Series B Convertible Preferred Stock”). The terms of the Series B Convertible Preferred Stock are:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0 0.5in; text-align: justify; text-indent: -0.25in"><font style="font-family: Symbol; letter-spacing: -0.1pt">·</font><font style="font: 7pt Times New Roman, Times, Serif; letter-spacing: -0.1pt">        
</font>rank pari passu to the common stock with respect to rights on liquidation, winding up and dissolution;</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0 0.5in; text-align: justify; text-indent: -0.25in"><font style="font-family: Symbol">·</font><font style="font: 7pt Times New Roman, Times, Serif">        
</font>have no dividend rights except as may be declared by the Board in its sole and absolute discretion;	</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0 35.7pt; text-align: justify; text-indent: -17.85pt"><font style="font-family: Symbol; letter-spacing: -0.1pt">·</font><font style="font: 7pt Times New Roman, Times, Serif; letter-spacing: -0.1pt">        
</font><font style="letter-spacing: -0.1pt">shall have the right to cast one thousand (1,000) votes for each share held of record
on all matters submitted to a vote of holders of the Corporation’s common stock; and</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0 35.7pt; text-align: justify; text-indent: -17.85pt"><font style="font-family: Symbol; letter-spacing: -0.1pt">·</font><font style="font: 7pt Times New Roman, Times, Serif; letter-spacing: -0.1pt">        
</font><font style="letter-spacing: -0.1pt">shall automatically convert into shares of common stock upon the occurrence of a reverse
stock split of the Corporation’s common stock in which every 100 shares of the Corporation’s common stock outstanding
at the time that this certificate of designation was filed with the Secretary of State of Nevada is exchanged for one share of
the Corporation’s common stock, with each share of Series B Convertible Preferred Stock converting into seven shares of the
Corporation’s common stock (such number to be after the 100:1 reverse stock split).</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">All prior period share transactions included
in the Company’s stock transactions and balances have been retroactively restated for the reverse stock splits described
above.</p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 12pt 0 0">2013 Share Transactions</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
January 2013, the Company issued </font>2,313 shares of its common stock for conversion of one of the two November 1, 2012 Notes
(Note 5) at a conversion price of $6.62 per share. In February 2013, the Company issued 2,500 common shares with a fair value of
$28,925 to a consultant pursuant to a consulting agreement. In February 2013, the Company issued 18,986 common shares on a cashless
conversion of 30,000 warrants at an exercise price of $5.72. In March 2013, the Company issued 100,000 common shares with a fair
value of $10,010 to a consultant pursuant to a consulting agreement.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">Between
January and March, 2013, the Company issued </font>31,763 shares of its common stock for conversion of December 14, 2012 Note (Note
5) at a conversion price of $6.03 per share..</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">Between
January and May, 2013, the Company issued </font>19,444 shares of its common stock for partial conversion of September 18, 2012
Note (Note 5) at an average conversion price of $3.60 per share.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">Between
February and March, 2013, the Company issued </font>10,500 shares of its common stock for partial conversion of August 8, 2012
Note (Note 5) at an average conversion price of $6.81 per share.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
April 2013, the Company issued </font>2,815 shares of its common stock for conversion of the balance of the November 1, 2012 Notes
(Note 5) at a conversion price of $6.07 per share.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">Between
April and September, 2013, the Company issued </font>264,649 shares of its common stock for partial settlement of debt in the amount
of $510,572. A further 455,311 shares remain to be issued with respect to this debt. The shares had a fair value of approximately
$910,000 at December 31, 2013.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
April, 2013, the Company issued </font>2,500 shares of its restricted common stock under a settlement agreement with a former director
of the Company.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">Between
May and July, 2013, the Company issued </font>53,690 shares of its common stock with a fair value of $248,278 for conversion of
October 9, 2012 Convertible Notes (Note 5).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">Between
May and June, 2013, the Company issued </font>30,000 shares of its common stock with a fair value of $137,200 for conversion of
the balances of the August 8, 2012 Note and November 20, 2013 Note (Note 5).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">Between
July and September 30, 2013, the Company issued </font>108,188 shares of its common stock with a fair value of $181,606 for conversion
of June 19, 2013 Convertible Note (Note 5).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
August, 2013, the Company issued </font>50,000 shares of its common stock with a fair value of $52,500 for conversion of July 12,
2013 Convertible Note (Note 5).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
August and September 2013, the Company issued </font>36,000 shares and is obligated to issue additional 20,472 shares of its common
stock with a fair value of $52,960 for conversion of November 20, 2012 Convertible Note (Note 5).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
September, 2013, the Company issued </font>10,000 shares of its common stock with a fair value of $10,500 for partial conversion
of September 18, 2012 Note (Note 5).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
November, 2013, the Company issued </font>12,000 shares of its common stock with a fair value of $13,340 for partial conversion
of September 18, 2012 Note (Note 5).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
November, 2013, the Company issued 45</font>,333 shares of its common stock with a fair value of $134,187 for partial conversion
of April 18, 2013 Note (Note 5).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">In March, 2013, the Company received
$242,950 for a private placement, for which it issued 34,707 shares and equal number of warrants. In December 2013, the Company
entered into rescission agreements whereby the Company replaced the shares and warrants with December, 2013 Convertible Notes II
and the 34,707 shares and warrants were returned to the treasury (Note 5).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The Company records shares issued for
non-cash consideration or on conversion of debt at the fair value. As a result of the above settlements and conversions, the Company
recorded a loss on settlement of debt of $2,560,045.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify; text-indent: 0.5in"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify"><b>2012 Share Transactions</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">On
March 15, 2012, the Company issued 3,333 shares of its restricted common stock to related parties, pursuant to debt settlement
agreements to settle $50,000 of outstanding trade payable. </font>At the time of issuance the fair value of the shares was determined
to be $50,000 based on the quoted market price of $15.00 per share.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">On
March 15, 2012, the Company issued </font>4,000 shares of its restricted common stock with a fair value of $71,200 pursuant to
a debt settlement and a consulting agreement.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">On
March 15, 2012, the Company issued </font>7,898 shares of its restricted common stock in settlement of accrued interest on the
outstanding 2011 Notes.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">In March 2012, the Company received subscription
proceeds of $85,000. The subscribers purchased 7,333 share units at $15.00 per unit. Each unit consists of 1 share of Company’s
common stock and half a warrant exercisable at $40.00, which expires in two years. The fair value of these warrants was determined
to be $5,133.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">In April 2012, the Company received subscription
proceeds of $345,000. The subscribers purchased 23,000 share units at $15.00 per unit. Each unit consists of 1 share of Company’s
common stock and half a warrant exercisable at $40.00, which expires in two years. The fair value of these warrants was determined
to be $123,000.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
April, 2012, the Company issued 1,</font>000 shares of its restricted common stock with a fair value of $18,500 pursuant to a debt
settlement and a consulting agreement.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">In April 2012, the Company issued 9,333 restricted common
shares, at $15.00 per share, for proceeds of $140,000 received in October 2011, in a private placement.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">In April 2012, the Company issued 10,000
common shares to a consultant pursuant to a consulting agreement effective October 1, 2011.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
April, 2012, the Company issued </font>1,633 shares of its restricted common stock with a fair value of $24,500 in settlement of
accrued interest on the outstanding 2011 Notes.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">In May 2012, the Company issued 140,000
common shares with a fair value of $1,918,000 to consultants pursuant to a consulting agreement.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
June 2012, the Company issued </font>352 shares of its restricted common stock with a fair value of $6,000 pursuant to a consulting
agreement.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
August 2012, the Company issued </font>5,000 shares of its restricted common stock with a fair value of $74,000 pursuant to a consulting
agreement.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
September 2012, the Company issued </font>5,000 shares of its restricted common stock with a fair value of $72,750 to the holder
of a promissory note in exchange for the note holder’s agreement to forebear from pursuing collection action on that note
(Note 7).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
November 2012, the Company issued </font>4,371 shares of its restricted common stock with a fair value of $55,944 on election by
the holder to convert part of a convertible debt (Note 5) at a conversion price of $5.72 per share.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
November 2012, the Company issued </font>5,972 shares of its restricted common stock with a fair value of $63,003 on election by
the holder to convert part of a convertible debt (Note 5) at a conversion price of $5.86 per share.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
November 2012, the Company issued </font>2,285 shares of its restricted common stock with a fair value of $21,591 on election by
the holder to convert part of a convertible debt (Note 5) at a conversion price of $6.01 per share.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
December 2012, the Company issued </font>10,788 shares of its restricted common stock with a fair value of $96,523 as payment of
installment of $65,032 for a convertible debt (Note 5) at a conversion price of $6.03 per share.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The Company records shares issued for
non-cash consideration or on conversion of debt at the fair value. As a result of the above settlements and conversions in 2012,
the Company recorded a loss on settlement of debt of $59,219.</p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 12pt 0 0">Stock Compensation Plan</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On October 14, 2009, the Company adopted
the 2009 Stock Incentive Plan (the “2009 Plan”) which supersedes and replaces the 2007 Stock Plan. The 2009 Plan allows
for the issuance of up to 100,000 common shares. <font style="letter-spacing: -0.1pt">Options granted under the Plan shall be at
prices and for terms as determined by the Board of Directors.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On April 30, 2012, the Company granted
2,500 stock options to an officer at an exercise price of $18.00 per share, vesting monthly over thirty six month period. <font style="letter-spacing: -0.1pt">The
aggregate fair value of the grant was estimated at $45,000, or $18.00 per option, using the Black-Scholes Option Pricing Model
with weighted average assumptions as follows: a risk free interest rate of 1.95%, a dividend yield of 0%, an expected volatility
of 199.0%, and an expected life of 10 years. </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On May 8, 2012, the Company granted 2,500
stock options to a consultant at an exercise price of $17.00 per share, vesting monthly over twelve month period. <font style="letter-spacing: -0.1pt">The
aggregate fair value of the grant was estimated at $40,000, or $17.00 per option, using the Black-Scholes Option Pricing Model
with weighted average assumptions as follows: a risk free interest rate of 1.71%, a dividend yield of 0%, an expected volatility
of 199.0%, and an expected life of 10 years. </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">The
expensed portion of the value of the granted and vested options during the year ended December 31, 2013 was $132,093 (2012 - $204,427)
which was recorded as stock based consulting and management fees.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"><font style="letter-spacing: -0.1pt"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt"><b>Share
purchase options</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify"><font style="letter-spacing: -0.1pt">A
summary of the Company’s stock options as of December 31, 2013 and 2012 and changes during the years is presented below:</font></p>
<table cellspacing="0" cellpadding="0" style="width: 100%; border-collapse: collapse; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td style="width: 47%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-top: 12pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="width: 17%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Number of</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Options</p></td>
<td style="width: 18%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Weighted Average</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Exercise Price</p></td>
<td style="width: 18%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Weighted Average</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Remaining Life</p></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td></tr>
<tr>
<td style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt"><b>Balance, December 31, 2011</b></td>
<td style="vertical-align: bottom; padding-right: 6.45pt; padding-left: 5.4pt; text-align: right">62,780 </td>
<td style="vertical-align: bottom; padding-right: 18.8pt; padding-left: 5.4pt; text-align: right">$  18.00</td>
<td style="vertical-align: bottom; padding-right: 21.95pt; padding-left: 5.4pt; text-align: right">6.85</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">  Issued</td>
<td style="padding-right: 6.45pt; padding-left: 5.4pt; text-align: right">5,150 </td>
<td style="padding-right: 18.8pt; padding-left: 5.4pt; text-align: right">17.00</td>
<td style="padding-right: 21.95pt; padding-left: 5.4pt; text-align: right">9.35</td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">  Cancelled/Forfeited</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 6.45pt; padding-left: 5.4pt; text-align: right">(2,500)</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 18.8pt; padding-left: 5.4pt; text-align: right">35.00</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 21.95pt; padding-left: 5.4pt; text-align: right">-</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 6.45pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 18.8pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 21.95pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><b>Balance, December 31, 2012</b></td>
<td style="padding-right: 6.45pt; padding-left: 5.4pt; text-align: right">65,430 </td>
<td style="padding-right: 18.8pt; padding-left: 5.4pt; text-align: right">  18.00</td>
<td style="padding-right: 21.95pt; padding-left: 5.4pt; text-align: right">6.05</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">  Issued</td>
<td style="padding-right: 6.45pt; padding-left: 5.4pt; text-align: right">- </td>
<td style="padding-right: 18.8pt; padding-left: 5.4pt; text-align: right">- </td>
<td style="padding-right: 21.95pt; padding-left: 5.4pt; text-align: right">- </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">  Cancelled/Forfeited</td>
<td style="padding-right: 6.45pt; padding-left: 5.4pt; text-align: right">- </td>
<td style="padding-right: 18.8pt; padding-left: 5.4pt; text-align: right">- </td>
<td style="padding-right: 21.95pt; padding-left: 5.4pt; text-align: right">- </td></tr>
<tr style="vertical-align: bottom">
<td style="border-top: windowtext 1pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><b>Balance, December 31, 2013 </b></td>
<td style="border-top: windowtext 1pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 6.45pt; padding-left: 5.4pt; text-align: right">65,430 </td>
<td style="border-top: windowtext 1pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 18.8pt; padding-left: 5.4pt; text-align: right">$  18.00</td>
<td style="border-top: windowtext 1pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 21.95pt; padding-left: 5.4pt; text-align: right">5.04</td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify; text-indent: 0.5in"><font style="letter-spacing: -0.1pt"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify"><font style="letter-spacing: -0.1pt">At
December 31, 2013, the intrinsic value of the vested options was equal to $nil (2012 - $nil).</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify"><font style="letter-spacing: -0.1pt">A
summary of the status of the Company’s unvested options as of December 31, 2013 is presented below:</font></p>
<table cellspacing="0" cellpadding="0" style="width: 100%; border-collapse: collapse; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td style="width: 47%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-top: 12pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="width: 17%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-top: 12pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="width: 18%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Number of</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Shares</p></td>
<td style="width: 18%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Weighted Average</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Grant-Date</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Fair Value</p></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><b>Unvested, December 31, 2012</b></td>
<td style="padding-right: 6.45pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.3pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">3,796 </font></td>
<td style="padding-right: 21.95pt; padding-left: 5.4pt; text-align: right">$  18.00</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">  Granted</td>
<td style="padding-right: 6.45pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.3pt; padding-left: 5.4pt; text-align: right">-<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 21.95pt; padding-left: 5.4pt; text-align: right">-</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">  Vested</td>
<td style="padding-right: 6.45pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.3pt; padding-left: 5.4pt; text-align: right">(2,685)</td>
<td style="padding-right: 21.95pt; padding-left: 5.4pt; text-align: right">18.00</td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">  Cancelled</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 6.45pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.3pt; padding-left: 5.4pt; text-align: right">-<font style="letter-spacing: -0.1pt"> </font></td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 21.95pt; padding-left: 5.4pt; text-align: right">-</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 6.45pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.3pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 21.95pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><b>Unvested, December 31, 2013</b></td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 6.45pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.3pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">1,111 </font></td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 21.95pt; padding-left: 5.4pt; text-align: right">$  16.00</td></tr>
</table>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 12pt 0 0">Share Purchase Warrants</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
March, 2012, the Company issued 3,667 share purchase warrants to acquire an equivalent number of common shares of the Company,
at an exercise price of $40 per share for an exercise period of up to two years from the issuance date. The warrants were issued
pursuant to the private placement of $110,000 and included within equity. The fair value of these warrants was determined to be
$5,133, using the Black-Scholes Option Pricing Model with an expected life of 2 years, a risk free interest rate of 0.37%, a dividend
yield of 0%, and an expected volatility of 63%.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
April, 2012, the Company issued 11,500 share purchase warrants to acquire an equivalent number of common shares of the Company,
at an exercise price of $40.00 per share for an exercise period of up to two years from the issuance date. The warrants were issued
pursuant to a private placement and included within equity. The fair value of these warrants was determined to be $123,000, using
the Black-Scholes Option Pricing Model with an expected life of 2 years, a risk free interest rate of 0.27%, a dividend yield of
0%, and an expected volatility of 146.6%.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
October, 2012, the Company issued 30,000 share purchase warrants to acquire an equivalent number of common shares of the Company,
at an exercise price of $25.00 per share for an exercise period of up to four years from the issuance date. The warrants were issued
pursuant to a convertible debt and included within equity. The residual fair value of these warrants was determined to be $62,000.
</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
December, 2012, the Company issued 10,000 share purchase warrants to acquire an equivalent number of common shares of the Company,
at an exercise price of $10.00 per share for an exercise period of up to five years from the issuance date. The warrants were issued
pursuant to a private placement and included within equity. The fair value of these warrants was determined to be $178,000, using
the Black-Scholes Option Pricing Model with an expected life of 5 years, a risk free interest rate of 0.87%, a dividend yield of
0%, and an expected volatility of 199.0%.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
May, 2013, the Company issued 20,000 share purchase warrants to acquire an equivalent number of common shares of the Company, at
an exercise price of $6.00 per share for an exercise period of up to four years from the issuance date. The warrants were issued
pursuant to a convertible debt with price adjustment features. The residual fair value of these warrants was determined to be $52,322
and recognized as a derivative liability. </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
July, 2013, the Company issued 41,667 share purchase warrants to acquire an equivalent number of common shares of the Company,
at an exercise price of $4.00 per share for an exercise period of up to five years from the issuance date. The warrants were issued
pursuant to a convertible debt with price adjustment features. The residual fair value of these warrants was determined to be $54,385
and recognized as a derivative liability. </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify"><font style="letter-spacing: -0.1pt">A
summary of the Company’s share purchase warrants as of December 31, 2013 and 2012 changes during the year is presented below:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify; text-indent: 0.5in"><font style="letter-spacing: -0.1pt"> </font></p>
<table cellspacing="0" cellpadding="0" style="width: 100%; border-collapse: collapse; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td style="width: 44%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><font style="letter-spacing: -0.1pt"> </font></td>
<td style="width: 18%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Number of</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Warrants</p></td>
<td style="width: 19%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Weighted Average</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Exercise Price</p></td>
<td style="width: 19%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Weighted Average</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Remaining Life</p></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td></tr>
<tr>
<td style="vertical-align: top; border-top: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><b>Balance, December 31, 2011</b></td>
<td style="vertical-align: bottom; border-top: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">121,064 </td>
<td style="vertical-align: bottom; border-top: windowtext 1pt solid; padding-right: 20.4pt; padding-left: 5.4pt; text-align: right">$  56.00</td>
<td style="vertical-align: bottom; border-top: windowtext 1pt solid; padding-right: 23.5pt; padding-left: 5.4pt; text-align: right">2.81</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">  Issued</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">55,167 </td>
<td style="padding-right: 20.4pt; padding-left: 5.4pt; text-align: right">26.00</td>
<td style="padding-right: 23.5pt; padding-left: 5.4pt; text-align: right">3.32</td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">  Exercised, cancelled or expired</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(7,144)</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 20.4pt; padding-left: 5.4pt; text-align: right">233.00</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 23.5pt; padding-left: 5.4pt; text-align: right">-</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><b>Balance, December 31, 2012</b></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">169,087 </td>
<td style="padding-right: 20.4pt; padding-left: 5.4pt; text-align: right">  39.00</td>
<td style="padding-right: 23.5pt; padding-left: 5.4pt; text-align: right">2.19</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">  Issued</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">67,667 </td>
<td style="padding-right: 20.4pt; padding-left: 5.4pt; text-align: right">5.84</td>
<td style="padding-right: 23.5pt; padding-left: 5.4pt; text-align: right">4.16</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">  Exercised</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(30,000)</td>
<td style="padding-right: 20.4pt; padding-left: 5.4pt; text-align: right">25.00</td>
<td style="padding-right: 23.5pt; padding-left: 5.4pt; text-align: right">-</td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt">  Extinguished or expired</td>
<td style="border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(57,302)</td>
<td style="border-bottom: windowtext 1pt solid; padding-right: 20.4pt; padding-left: 5.4pt; text-align: right">39.72</td>
<td style="border-bottom: windowtext 1pt solid; padding-right: 23.5pt; padding-left: 5.4pt; text-align: right">-</td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><b>Balance, December 31, 2013 </b></td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">149,452 </td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 20.4pt; padding-left: 5.4pt; text-align: right">$  25.85</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 23.5pt; padding-left: 5.4pt; text-align: right">2.76</td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"> </p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 0">NOTE 10: INCOME TAXES</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The Company has not identified or quantified
any significant temporary differences between the Company’s tax and financial bases of assets and liabilities that result
in deferred tax assets, except for the Company’s net operating loss carry-forwards amounting to approximately $22,154,000
at December 31, 2013 (2012 - $18,713,000), which may be available to reduce future year’s taxable income. These carry forwards
begin to expire, if not utilized, commencing in 2015. Future tax benefits which may arise as a result of these losses have not
been recognized in these financial statements, as their realization does not meet a more likely than not test and accordingly,
the Company has recorded a 100% valuation allowance for the potential deferred tax asset relating to these tax loss carry forwards.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The Company reviews its valuation allowance
requirements on an annual basis based on management’s expectations of future operations. Should circumstances change resulting
in a change in management’s judgment about the recoverability of future tax assets, the impact of the change on the valuation
allowance would be reflected in current operations and disclosures.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The Company’s policy is to accrue
amounts for known or likely interest and penalties related to unrecognized tax charges or likely penalties and interest in its
provision for income taxes. Additionally, ASC 740-10 requires that a company recognize in its financial statements the impact of
a tax position that is more likely than not to be sustained upon examination based on the technical merits of the position. The
Company has incurred taxable losses for all tax years since inception and accordingly, no provision for taxes has been recorded
for the current or any prior fiscal year.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The actual income tax provisions differ
from the expected amounts calculated by applying the combined federal and state corporate income tax rates to the Company’s
loss before income taxes and other temporary adjusted as appropriate for temporary and permanent tax basis differences. The components
of these differences are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify; text-indent: 0.5in"> </p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="width: 56%; border-top: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="width: 22%; border-top: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Year Ended</td>
<td style="width: 22%; border-top: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Year Ended</td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">December 31, 2013</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">December 31, 2012</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Loss before income taxes</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  (5,532,552)</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  (6,171,867)</td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Corporate tax rate</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">35%</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">35%</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Expected tax recovery</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(1,936,393)</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(2,160,153)</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Increase (decrease) resulting from:</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">  Permanent differences</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">626,270 </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">384,590 </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">  Other items</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(3,908)</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(3,908)</td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">  Change in valuation allowance</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">1,314,031 </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">1,779,471 </td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Income tax recovery</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$                 - </td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$                  - </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 6pt; text-align: justify">The Company’s estimated deferred
tax assets are as follows:</p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="width: 63%; border-top: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="width: 18%; border-top: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Year Ended</td>
<td style="width: 19%; border-top: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Year Ended</td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">December 31, 2013</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">December 31, 2012</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Deferred tax assets:</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">  Stock option expense</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$    2,730,750 </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$    2,730,750 </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">  Loss carry-forwards and tax pools</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">11,078,782 </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">9,585,489 </td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">  Valuation allowance</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(13,809,532)</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(12,316,239)</td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Net deferred income tax assets</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$                   - </td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$                   - </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">As
the criteria for recognizing future </font>income tax assets have not been met due to the uncertainty of realization, a valuation
allowance of 100% has been recorded for the current and prior year.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The Company has not filed income tax
returns for several years for the US entities within the consolidated group of companies. Canadian corporate tax returns to the
end of 2007 have been filed. Both taxing authorities prescribe penalties for failing to file certain tax returns and supplemental
disclosures. Upon filing and/or review there could be penalties and interest assessed. Such penalties vary by jurisdiction and
by assessing practices and authorities. As the Company has incurred losses since inception anticipated risk for exposure to penalties
for income tax liability is determined to be low. However, certain jurisdictions may assess penalties for failing to file returns
and other disclosures and for failing to file other supplementary information associated with foreign ownership, debt and equity
positions. Inherent uncertainties arise over tax positions taken, or expected to be taken, with respect to transfer pricing, inter-company
charges and allocations, financing charges, fees, related party transactions, tax credits, tax based incentives and stock based
transactions.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">Management has considered the likelihood
and significance of possible penalties associated with its current and intended filing positions and has determined, based on their
assessment<font style="letter-spacing: -0.1pt">, that such penalties, if any, would not be expected to be material.</font></p>
<p style="margin: 0pt"> </p>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"> </p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 0"><font style="text-transform: uppercase">Note 12:	ContingencIES
AND COMMITMENTs</font></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 12pt 0 0">Contingencies:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt"><b>Consultant
Litigation</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In May 2012, the Company issued 112,000 post-consolidated
shares of common stock to two consultants. The Company contested the validity of the services provided and initially were able
to delay the sale of the contested shares. The Company was not successful in recovering the contested shares. A claim for alleged
damages of approximately $362,000 plus costs by one of the consultants as a result of the contesting of the issuance of the shares
has been filed in the Supreme Court of New York. The claim is for damages on the difference between market price at the time the
Company was able to delay the sale of his shares and the market price at the time of the sale of all of his shares. As the result
of a judicial decision in New York the consultant received a bond payment of approximately $100,000 that the Company had used to
secure a temporary restraining order against the issuance of stock to him. The Company is pursuing this litigation through the
American Arbitration Association and the potential loss from this litigation, if any, is presently not yet determinable.</p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 12pt 0 0">Tax Filings</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">The
Company has not filed income tax returns for several years in certain operating jurisdictions (Note 10), and may be subject to
possible compliance penalties and interest. Management is currently not able to make a reliably measurable provision for possible
liability for penalties and interest, if any, at this time, and the Company may be liable for such amounts upon assessment. Penalties
and interest, if assessed in the future, will be recorded in the period such amounts are determinable.</font></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 12pt 0 0">Commitments:</p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 12pt 0 0">Combined Research and Operating Obligations</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">Effective
May 25, 2010, the Company entered into a research and license Option Agreement with the Mayo Clinic for the development and possible
commercial use of a cancer vaccine. Subject to the approval and guidance of the United States Food and Drug Administration (“FDA”)
the Mayo Clinic plans to conduct a Phase I human clinical trial (“Phase I Trial”) to test and develop the Company’s
technology. </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">The
Company agreed that, during the period of the option and upon approval of FDA to conduct Phase I Trials, it will pay all the costs
incurred by the Mayo Clinic, not to exceed a total of $841,000, of which $510,000 has been paid by a third party under the subsequent
Sponsored Research Agreement and $330,000 has been accrued as of December 31, 2013. Management anticipates that Phase 1 Trials
will complete by the end of 2014.</font></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 12pt 0 0">Management Services Agreement</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"><font style="letter-spacing: -0.1pt"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="letter-spacing: -0.1pt">In February
2011, the Company approved an employment agreement with Dr. Wilson with an initial term of 2 years, which may be automatically
extended for successive one-year terms. This employment agreement provides for annual compensation of $180,000 and the grant of
an option to acquire 20,000 shares of the Company’s common stock at $19.00 per share, 50% of which vested on March 16, 2011,
while the remainder will vest monthly over a period of two years (417 per month). The options shall be exercisable for at least
five years.</font></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 12pt 0 0">Consultant Agreements</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
May 2012, the Company entered into a one year consulting services agreement superseding the previous management consulting agreement
with a consultant (“Consultant A”) to provide expertise in the areas of finance and corporate development to the Management
and Board of TapImmune. The consulting services agreement provides for a consulting fee of $12,000 per month from May 2012 to December
2012 and $10,000 for the following four months. The Company also granted 2,500 options to the consultant, vesting equally over
twelve months at an exercise price of $17.00 with a ten year term.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
November 2013, the Company entered into an advisory agreement with Consultant A to provide expertise in the areas of finance, corporate
restructuring and corporate development to the Management and Board of TapImmune for a one year term. The advisory agreement provides
for an advisory fee of $10,000 per month from November 2013 to May 2014 for six months, extendable for additional six months subject
to mutual agreement. The Company will also grant 250,000 shares to the consultant post restructuring of the Company’s debt(Note
15).</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"><font style="letter-spacing: -0.1pt">In
December 2012, the Company entered into a one year consulting agreement starting on January 1, 2013 with a company owned by a director
of the Company to provide consulting services relating to immunotherapies and other technologies of interest to the Company. The
consulting agreement provides for a consulting fee of $3,500 per month, of which $2,500 shall be payable in cash and $1,000 paid
in common stock. The agreement can be extended by an additional one-year period by mutual written consent. As of December 31, 2013,
the consulting agreement had not been extended.</font></p>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"> </p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 0"><font style="text-transform: uppercase">Note 13:	accounts
payable and accrued liabilities</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"><font style="text-transform: uppercase"><b> </b></font></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 12pt 0 0">Accounts Payable and Accrued Liabilities<font style="font-size: 8pt; font-weight: normal"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> December 31, 2013 </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> December 31, 2012 </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" style="width: 17%; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="width: 19%; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="width: 4%; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="width: 31%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">                        $ </td>
<td nowrap="nowrap" style="width: 9%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td nowrap="nowrap" style="width: 18%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">               $ </td>
<td nowrap="nowrap" style="width: 2%; padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> Trade accounts payable </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">               1,450,083 </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">               1,663,315 </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> Debt settlement accruals</td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">1,348,663</td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">-</td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> Accrued liabilities </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">                  201,334 </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">                  142,245 </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> Employee payroll and severance</td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">                  220,290 </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">                    61,458 </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> Accrued interest </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">                  558,032 </td>
<td nowrap="nowrap" style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">                    74,698 </td>
<td nowrap="nowrap" style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">                  3,778,401 </td>
<td nowrap="nowrap" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">               1,941,716 </td>
<td nowrap="nowrap" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">                             </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
</table>
<hr class="msocomoff" align="left" size="1" style="width: 33%" />
<p style="margin: 0pt"></p>
<p style="margin: 0pt"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 12pt 0 0"><b>NOTE 14: RESTATEMENT OF CONSOLIDATED FINANCIAL STATEMENTS</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The consolidated financial statements as of
and for the year ended December 31, 2012 have been restated to revise the Company’s accounting for derivative liabilities
and certain other accounts. The fair value of certain derivative liabilities was adjusted to record the effect of conversion of
certain convertible notes and proper classification of some of the liabilities.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0">The impact of the restatement on the consolidated financial statements
as of and for the year ended December 31, 2012, is shown in the following table:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<table cellspacing="0" cellpadding="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<tr style="vertical-align: top">
<td colspan="8" style="padding-right: 5.4pt; padding-left: 5.4pt"><b>Balance sheet data — December 31, 2012 </b></td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">As reported</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">Adjustment</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">As restated</td></tr>
<tr style="vertical-align: top">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Cash </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">50,679<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$</td>
<td colspan="2" style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(16,840)</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">33,839<font style="letter-spacing: -0.1pt"> </font> </td></tr>
<tr style="vertical-align: top">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Total assets</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">104,212<font style="letter-spacing: -0.1pt"> </font></td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(16,840)</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">87,372<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Accounts payable and accrued liabilities </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">2,058,556<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(116,840)</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">1,941,716<font style="letter-spacing: -0.1pt"> </font> </td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Derivative liability – conversion option </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">798,300<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">69,275<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">867,575<font style="letter-spacing: -0.1pt"> </font> </td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Derivative liability - warrants</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">677,086  </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">300,000<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">977,086<font style="letter-spacing: -0.1pt"> </font>   </td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Convertible notes payable</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">1,376,230  </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">100,000<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">1,476,230  </td></tr>
<tr style="vertical-align: top">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Due to related parties</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">366,697<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">6,649<font style="letter-spacing: -0.1pt"> </font></td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">373,346<font style="letter-spacing: -0.1pt"> </font> </td></tr>
<tr style="vertical-align: top">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Total liabilities</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">5,770,809<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">359,084<font style="letter-spacing: -0.1pt"> </font></td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">6,129,893<font style="letter-spacing: -0.1pt"> </font> </td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Additional paid-in capital</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">43,545,947<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">(62,000)</font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">43,483,947 </font></td></tr>
<tr style="vertical-align: top">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Deficit accumulated during the development stage</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(49,580,159)</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(313,924)</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(49,894,083)</td></tr>
<tr style="vertical-align: top">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Stockholders’ deficiency</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(5,666,597) </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$</td>
<td colspan="2" style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(375,924)</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(6,042,521) </td></tr>
<tr style="vertical-align: top">
<td colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: top">
<td colspan="8" style="padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>Consolidated Statement of Operations data </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>For the year ended December 31, 2012</b></p></td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">As reported</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">Adjustment</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">As restated</td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Management fees </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$ </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">295,600<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$ </td>
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">6,649<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$ </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">302,249<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: top">
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Net loss before other items</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(6,222,798)</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(6,649)</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(6,229,447)</td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Changes in fair value of derivative liabilities </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">536,527<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(307,375) </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">229,252<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: top">
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Net Loss </td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(5,857,943)</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$</td>
<td colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(313,924)</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(6,171,867)</td></tr>
<tr style="vertical-align: top">
<td colspan="8" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr>
<td style="width: 54%"> </td>
<td style="width: 3%"> </td>
<td style="width: 12%"> </td>
<td style="width: 4%"> </td>
<td style="width: 11%"> </td>
<td style="width: 1%"> </td>
<td style="width: 3%"> </td>
<td style="width: 12%"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<table cellspacing="0" cellpadding="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<tr style="vertical-align: top">
<td colspan="7" style="padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>Consolidated Statement of Operations data </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>From July 27, 1999 (inception) to December 31, 2012</b></p></td></tr>
<tr style="vertical-align: top">
<td style="width: 54%; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="width: 3%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="width: 12%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">As reported</td>
<td style="width: 4%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="width: 12%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">Adjustment</td>
<td style="width: 3%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="width: 12%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">As restated</td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Management fees </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$ </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">3,067,654<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$ </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">6,649<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$ </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">3,074,303<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: top">
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Net loss before other items</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(41,491,894)</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(6,649)</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(41,498,543)</td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Changes in fair value of derivative liabilities </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">4,611,667<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(307,375) </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">4,304,392<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: top">
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Net Loss</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(49,580,159)</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(313,924)</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(49,894,083)</td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 0"><font style="text-transform: uppercase">Note 15:	SUBSEQUENT
EVENTS</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"><font style="letter-spacing: -0.1pt"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On January 6, 2014, the Company designated
1,200,000 series A preferred shares (“Series A Convertible Preferred Stock”). Each share of Series A Convertible Preferred
Stock that is outstanding at the time that the Company enacts a reverse stock split, the Series A Convertible Preferred Stock shall
automatically convert into five shares of the Company’s common stock on a post-split basis.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On January 10, 2014, the shareholders
and the board of directors of the Company approved a reverse stock split whereby every one hundred shares of common stock held
by a stockholder were exchanged for one share of the Company’s common stock.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On January 10, 2014, the Company amended
its Articles of Incorporation to increase its authorized share capital from 150,000,000 shares of common stock and 5,000,000 shares
of preferred stock to 500,000,000 shares of common stock and 5,000,000 shares of preferred stock.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On February 18, 2014, the Company’s
board of directors approved the creation of a class of up to 1,500,000 preferred stock, par value $0.001, called series B convertible
preferred stock (“Series B Convertible Preferred Stock”). The terms of the Series B Convertible Preferred Stock are:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0 0.5in; text-align: justify; text-indent: -0.25in"><font style="font-family: Symbol; letter-spacing: -0.1pt">·</font><font style="font: 7pt Times New Roman, Times, Serif; letter-spacing: -0.1pt">        
</font>rank pari passu to the common stock with respect to rights on liquidation, winding up and dissolution;</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0 0.5in; text-align: justify; text-indent: -0.25in"><font style="font-family: Symbol">·</font><font style="font: 7pt Times New Roman, Times, Serif">        
</font>have no dividend rights except as may be declared by the Board in its sole and absolute discretion;	</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0 35.7pt; text-align: justify; text-indent: -17.85pt"><font style="font-family: Symbol; letter-spacing: -0.1pt">·</font><font style="font: 7pt Times New Roman, Times, Serif; letter-spacing: -0.1pt">        
</font><font style="letter-spacing: -0.1pt">shall have the right to cast one thousand (1,000) votes for each share held of record
on all matters submitted to a vote of holders of the Corporation’s common stock; and</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0 35.7pt; text-align: justify; text-indent: -17.85pt"><font style="font-family: Symbol; letter-spacing: -0.1pt">·</font><font style="font: 7pt Times New Roman, Times, Serif; letter-spacing: -0.1pt">        
</font><font style="letter-spacing: -0.1pt">shall automatically convert into shares of common stock upon the occurrence of a reverse
stock split of the Corporation’s common stock in which every 100 shares of the Corporation’s common stock outstanding
at the time that this certificate of designation was filed with the Secretary of State of Nevada is exchanged for one share of
the Corporation’s common stock, with each share of Series B Convertible Preferred Stock converting into seven shares of the
Corporation’s common stock (such number to be after the 100:1 reverse stock split).</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">In January and February 2014, the Company converted debt totaling
approximately $3,498,000 into 874,555 shares of Series A Convertible Preferred Stock. On February 20, 2014, the 874,555 shares
of Series a Convertible Preferred Stock were converted into 4,372,774 shares of common stock. This debt included $746,696 of principal
and interest due to related parties, which was converted into 933,370 common shares.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">In February 2014, the Company converted
debt totaling approximately $1,374,000 into 1,374,307 shares of Series B Convertible Preferred Stock. On February 20, 2014, the
1,374,307 shares of Series B Convertible Preferred Stock were converted into 9,620,150 shares of common stock.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">On February 20, 2014, the Company issued 168,787 shares of
common stock for:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0 35.7pt; text-align: justify; text-indent: -17.85pt"><font style="font-family: Symbol">·</font><font style="font: 7pt Times New Roman, Times, Serif">        
</font>5,000 restricted common shares in exchange for legal fees,</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0 35.7pt; text-align: justify; text-indent: -17.85pt"><font style="font-family: Symbol">·</font><font style="font: 7pt Times New Roman, Times, Serif">        
</font>150,000 restricted common shares in pursuant to a consulting agreement, and</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0 35.7pt; text-align: justify; text-indent: -17.85pt"><font style="font-family: Symbol">·</font><font style="font: 7pt Times New Roman, Times, Serif">        
</font>13,787 restricted common shares in exchange for legal fees.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">On March 24, 2014, the Company issued 145,000 shares of its
common stock to one person for the settlement of approximately $127,040 of debt, and on April 4, 2014, the Company issued 244,764
shares of common stock to the same person for the settlement of approximately $214,446 of debt.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">In February, 2014, the Company entered
into a one year media and investor relations service contract with a consultant. The contract provides for the Company to make
a $100,000 payment on signing of the contract and 200,000 shares of restricted common stock, of which 100,000 are to be issued
immediately and an additional 100,000 restricted common stock within 10 business days upon the Company’s successful listing
on NASDAQ or NYSE MKT exchange.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">On March 18, 2014, a third party entered
into an option agreement with the Company to assign its technology license agreement (“license Agreement”) with Mayo
Foundation for Medical Education and Research (“Mayo”) on the following terms:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0 35.7pt; text-align: justify; text-indent: -17.85pt"><font style="font-family: Symbol">·</font><font style="font: 7pt Times New Roman, Times, Serif">        
</font>The Company to issue 100,000 share purchase warrants of its common stock at a price of $4.00 per share for a five year term
as compensation for receiving the option;</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0 35.7pt; text-align: justify; text-indent: -17.85pt"><font style="font-family: Symbol">·</font><font style="font: 7pt Times New Roman, Times, Serif">        
</font>On the Company exercising its option and completing the assignment, at the option of the third party, issuing additional
100,000 share purchase warrants of its common stock at a price of $4.00 per share for a five year term or 25% of the royalties
that Mayo is to receive under the License Agreement; and</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0 35.7pt; text-align: justify; text-indent: -17.85pt"><font style="font-family: Symbol">·</font><font style="font: 7pt Times New Roman, Times, Serif">        
</font>Pay the third party $400,000, the payments made by the third party to Mayo, either in cash or shares of the Company’s
common stock equal to such amount divided by $4.00.</p>
<p style="margin: 0pt"> </p>
<p style="margin: 0pt"> </p>
<p style="margin: 0pt"></p>
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<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0"> </p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Basis of Presentation</p>
<p style="margin: 0">These financial statements are presented in United <font style="letter-spacing: -0.1pt">States</font> dollars
and have been prepared in accordance with accounting principles generally accepted in the United States of America.</p>
<p style="margin: 0"> </p>
<p style="margin: 0"> </p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Principles of Consolidation</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">These financial statements <font style="letter-spacing: -0.1pt">include</font>
the accounts of the Company and its wholly-owned subsidiaries GeneMax Pharmaceuticals Inc. (“GPI”) and GeneMax Pharmaceuticals
Canada Inc. (“GPC”). All significant intercompany balances and transactions are eliminated upon consolidation.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"> </p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Use of Estimates</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">Preparation of the Company’s <font style="letter-spacing: -0.1pt">financial</font>
statements in conformity with accounting principles generally accepted in the United States of America requires management to make
estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ materially
from those estimates. Significant areas requiring management’s estimates and assumptions include deferred taxes and related
tax balances and disclosures, determining the fair value of stock-based compensation and stock based transactions, the fair value
of the components of the convertible notes payable, foreign exchange gains and losses, and accrued liabilities. Matters impacting
the company’s ability to continue as a going concern and contingencies also involve the use of estimates and assumptions.</p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Fair Value Measurements</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The objective of ASC 820, <i>Fair Value
Measurements and Disclosures</i>, is to increase consistency and comparability in fair value measurements and to expand disclosures
about fair value measurements. ASC 820 defines fair value, establishes a <font style="letter-spacing: -0.1pt">framework</font>
for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. ASC
820 applies under other accounting pronouncements that require or permit fair value measurements and does not require any new fair
value measurements.</p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Foreign Currency Translation</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The functional currency of the Company, including
its US subsidiary, is United States dollars. GPC maintains its accounting records in its local currency (Canadian dollar). In accordance
with ASC 830, <i>Foreign Currency Matters</i>, the financial statements of the Company's subsidiary is translated into United States
dollars using period end exchange rates for monetary assets and liabilities and average <font style="letter-spacing: -0.1pt">exchange</font>
rates over the period for revenues and expenses. Non-monetary assets are translated at their historical exchange rates. Exchange
gains or losses from such translations are included in accumulated comprehensive income (loss), as a separate component of stockholders'
equity.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"> Net gains and losses resulting
from foreign currency exchange gains and losses on transactions occurring in a currency other than the Company's functional currency
are included in the determination of net income in the period.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Financial Instruments and Concentration of Credit Risk</p>
<p style="margin: 0; text-align: justify">The fair values of cash, accounts payable, and other current monetary liabilities approximate their carrying
values due to the immediate or short-term <font style="letter-spacing: -0.1pt">maturity</font> of these financial instruments.
The Company's operations and financing activities are conducted primarily in United States dollars, and as a result the Company
is not subject to significant exposure to market risks from changes in foreign currency rates. U<font style="letter-spacing: -0.1pt">nless
otherwise noted, it is management's opinion that the Company is not exposed to significant interest or credit risks arising from
assets classified as financial instruments.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Impairment of Long-Lived Assets</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">Long-lived assets are reviewed for impairment
whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. <font style="letter-spacing: -0.1pt">Circumstances</font>
which could trigger a review include, but are not limited to: significant decreases in the market price of the asset; significant
adverse changes in the business climate or legal factors; accumulation of costs significantly in excess of the amount originally
expected for the acquisition or construction of the asset; current period cash flow or operating losses combined with a history
of losses or a forecast of continuing losses associated with the use of the asset; and current expectation that the asset will
more likely than not be sold or disposed significantly before the end of its estimated useful life. Recoverability of these assets
is measured by comparison of carrying amounts to future undiscounted cash flows the assets are expected to generate. An impairment
loss is recognized when the carrying amount exceeds fair value.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Stock-Based Compensation</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The Company uses the Black-Scholes option-pricing
model to determine the grant date fair-value of stock-based awards under ASC 718, <i>Compensation – Stock Compensation</i>.
The fair value is recorded in income depending on the terms and conditions of the award, and the <font style="letter-spacing: -0.1pt">nature</font>
of the relationship of the recipient of the award to the Company. The Company records the grant date fair value in income in line
with the period over which it was earned. For employees and management this is typically considered to be the vesting period of
the award. For consultants the fair value of the award is recorded in income over the term of the service period, and unvested
amounts are revalued at each reporting period over the service period.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Deferred Financing Costs</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The Company defers direct costs incurred
in connection with the sale of common shares which are offset against the proceeds of the financing upon completion. Costs incurred
in connection with convertible loans payable are deferred and amortized as a financing cost over the term of the convertible loans.
Upon conversion of the loan, any unamortized amount of deferred financing costs will be charged to <font style="letter-spacing: -0.1pt">stockholders’</font>
equity as a cost of financing.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Research and Development Costs</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The Company has acquired <font style="letter-spacing: -0.1pt">development</font>
and marketing rights to certain technologies. The rights and licenses acquired are considered rights to unproven technology which
may not have alternate future uses and therefore, have been expensed as incurred as research and development costs.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Income Taxes</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The Company follows the liability method
of accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences
attributable to differences between the financial statement carrying amounts of assets and liabilities and their respective tax
balances. Potential deferred tax assets and liabilities are measured using enacted tax rates expected <font style="letter-spacing: -0.1pt">to</font>
apply to the taxable income in the years in which those differences are expected to be recovered or settled. The effect on potential
deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the date of enactment.
The Company recognizes deferred taxes on unrealized gains directly within other comprehensive income, and concurrently releases
part of the related valuation allowance resulting in nil impact within OCI or on the balance sheet. As at December 31, 2013, the
Company had net operating loss carry forwards; however, due to the uncertainty of realization, the Company has provided a full
valuation allowance for the potential deferred tax assets resulting from these loss carry forwards.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Derivative Warrant Liability</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The Company evaluates its convertible
debt, options, warrants or other contracts to determine if those contracts or embedded components of those contracts qualify as
derivatives to be separately accounted for in accordance with ASC 810-10-05-4 and 815-40. This accounting treatment requires that
the carrying amount of embedded derivatives be marked-to-market at each balance sheet date and carried at fair value. In the event
that the fair value is recorded as a liability, the change in fair value during the period is recorded in the Statement of Operations
as either income or expense. Upon conversion, exercise or modification to the terms of a derivative instrument, the instrument
is marked to fair value at the conversion date and then the related fair value is reclassified to equity.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">In circumstances where the embedded conversion
option in a convertible instrument is required to be bifurcated and there are also other embedded derivative instruments in the
convertible instrument that are required to be bifurcated, the bifurcated derivative instruments are accounted for as a single,
compound derivative instruments.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The classification of derivative instruments,
including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting
period. Equity instruments that are initially classified as equity that become subject to reclassification are reclassified to
liability at the fair value of the instrument on the reclassification date. Derivative instrument liabilities will be classified
in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument is expected
within 12 months of the balance sheet date.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">In evaluating the application of ASC
815-40, management must determine whether an instrument (or an embedded feature) is indexed to the Company’s own stock. ASC
815-40-15 provides that an entity should use a two-step approach to evaluate whether an equity-linked financial instrument (or
embedded feature) is indexed to its own stock, including evaluating the instrument’s contingent exercise and settlement provisions.
The application of ASC 815-40-15 has affected the accounting for (i) certain freestanding warrants that contain exercise price
adjustment features and (ii) convertible notes containing full-ratchet and anti-dilution protections (iii) certain free standing
warrants that contain contingently puttable cash settlement.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Fair Value of Financial Instruments</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The Company follows ASC paragraph 825-10-50-10
for disclosures about fair value of its financial instruments and ASC paragraph 820-10-35-37 to measure the fair value of its financial
instruments. 820-10-35-37 establishes a framework for measuring fair value pursuant to GAAP and expands disclosures about fair
value measurements. To increase consistency and comparability in fair value measurements and related disclosures, paragraph 820-10-35-37
further establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into
three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for
identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy are
described below:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">Level 1	Quoted market prices available
in active markets for identical assets or liabilities as of the reporting date.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0 1in; text-align: justify; text-indent: -1in">Level 2	Pricing
inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of
the reporting date.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">Level 3	Pricing inputs that are generally
observable inputs and not corroborated by market data.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The carrying amounts of the Company’s
financial assets and liabilities, such as cash, due from government agency, accounts payable and accrued liabilities, research
agreement obligations, and due to related parties, approximate their fair values because of their short term maturity. The Company’s
convertible notes payable approximate fair value based upon management’s estimate of comparable interest rates that would
be available to the Company for similar financial arrangements.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">The Company revalues its derivative warrant
and derivative conversion option liabilities at each reporting period and recognizes gains or losses in the consolidated statements
of operations that are attributable to the change in the fair value.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0"></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 6pt 0 0">Loss per Common Share</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">Basic loss per share is computed by dividing
loss attributable to common stockholders by the weighted average number of common shares outstanding for the period. If applicable,
diluted earnings per share reflect the potential dilution of securities that could share in the earnings (loss) of the Company.
The common shares potentially issuable on conversion of outstanding convertible debentures, warrants and stock options are anti-dilutive
and have not been included in the calculation.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0"><b>Recently Issued Accounting Pronouncements</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On April 1, 2012, the Company adopted new guidance
related to the presentation of comprehensive income. The main provisions of the new guidance provide that an entity that reports
items of other comprehensive income has the option to present comprehensive income as (i) a single statement that presents the
components of net income and total net income, the components of other comprehensive income and total other comprehensive income
and a total for comprehensive income or (ii) in two separate but consecutive statements, whereby an entity must present the components
of net income and total net income in the first statement and that statement is immediately followed by a financial statement that
presents the components of other comprehensive income, a total for other comprehensive income and a total for comprehensive income.
The new rules eliminate the option to present the components of other comprehensive income as part of the statement of stockholders'
equity. These new rules have been applied retrospectively and became effective for fiscal years, and interim periods within those
fiscal years, beginning on or after December 15, 2011 (January 1, 2012 for the Company), with early adoption permitted. The adoption
of this new guidance did not have a material impact on our Consolidated Financial Statements.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company has reviewed recently issued accounting
pronouncements and plans to adopt those that are applicable to it. It does not expect the adoption of these pronouncements
to have a material impact on its financial position, results of operations or cash flows.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></p>
492365
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: top">
<td style="border-bottom: windowtext 1pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify"> </td>
<td colspan="4" style="border-bottom: windowtext 1pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">December 31, 2012</td>
<td colspan="4" style="border-bottom: windowtext 1pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">December 31, 2013</td></tr>
<tr>
<td style="vertical-align: top; width: 26%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify"> </td>
<td style="vertical-align: bottom; width: 10%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Expected Life (Years)</td>
<td style="vertical-align: bottom; width: 10%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Risk free Rate</td>
<td style="vertical-align: bottom; width: 9%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Dividend yield</td>
<td style="vertical-align: bottom; width: 9%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Volatility</td>
<td style="vertical-align: bottom; width: 9%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Expected Life (Years)</td>
<td style="vertical-align: bottom; width: 9%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Risk free Rate</td>
<td style="vertical-align: bottom; width: 9%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Dividend yield</td>
<td style="vertical-align: bottom; width: 9%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Volatility</td></tr>
<tr style="vertical-align: top">
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify">Share purchase warrants</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">0.08 to 3.21</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">0.02% to 0.36%</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">0.00%</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">199%</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">0.85 to 2.78</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">0.13% to 0.78%</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">0.00%</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">199%</td></tr>
</table>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: top">
<td style="border-bottom: windowtext 1pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify"> </td>
<td colspan="4" style="border-bottom: windowtext 1pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">December 31, 2012</td>
<td colspan="4" style="border-bottom: windowtext 1pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">December 31, 2013</td></tr>
<tr>
<td style="vertical-align: top; width: 24%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify"> </td>
<td style="vertical-align: bottom; width: 9%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Expected Life (Years)</td>
<td style="vertical-align: bottom; width: 9%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Risk free Rate</td>
<td style="vertical-align: bottom; width: 9%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Dividend yield</td>
<td style="vertical-align: bottom; width: 11%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Volatility</td>
<td style="vertical-align: bottom; width: 9%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Expected Life (Years)</td>
<td style="vertical-align: bottom; width: 9%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Risk free Rate</td>
<td style="vertical-align: bottom; width: 9%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Dividend yield</td>
<td style="vertical-align: bottom; width: 11%; border-bottom: windowtext 1.5pt solid; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Volatility</td></tr>
<tr style="vertical-align: top">
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify">Conversion option</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">0.003 to 0.89</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">0.05% to 0.19%</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">0.00%</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">100.88% to 141.21%</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">0.16 to 0.53</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">0.04% to 0.10%</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">0.00%</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">199% </td></tr>
</table>
<table cellspacing="0" cellpadding="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="border-top: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: left"> </td>
<td colspan="2" style="border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: left; text-indent: 0.5in"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: left"><b>As of December 31, 2013</b></p></td>
<td colspan="2" style="border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td colspan="2" style="border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="5" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><b>Fair Value Measurements </b></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p></td>
<td style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><b>Carrying Value</b></td>
<td colspan="2" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><b>Level 1</b></td>
<td colspan="2" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><b>Level 2</b></td>
<td style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><b>Level 3</b></td>
<td style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><b>Total</b></td></tr>
<tr>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt">Derivative liability - warrants</td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  140,504</td>
<td colspan="2" style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td colspan="2" style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  140,504</td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  140,504</td></tr>
<tr>
<td style="vertical-align: bottom; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Derivative liability – conversion option</td>
<td style="vertical-align: bottom; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">582,300</td>
<td colspan="2" style="vertical-align: top; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td colspan="2" style="vertical-align: bottom; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td style="vertical-align: bottom; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">582,300</td>
<td style="vertical-align: bottom; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">582,300</td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Total</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  722,804</td>
<td colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  722,804</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  722,804</td></tr>
<tr>
<td style="width: 36%"> </td>
<td style="width: 13%"> </td>
<td style="width: 11%"> </td>
<td style="width: 1%"> </td>
<td style="width: 12%"> </td>
<td style="width: 1%"> </td>
<td style="width: 13%"> </td>
<td style="width: 13%"> </td></tr>
</table>
<table cellspacing="0" cellpadding="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<tr>
<td style="vertical-align: bottom; border-top: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: left"> </td>
<td colspan="3" style="vertical-align: bottom; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: left; text-indent: 0.5in"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>As of December 31, 2012 </b></p></td>
<td colspan="2" style="vertical-align: bottom; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="vertical-align: bottom; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="border-bottom: windowtext 0.5pt solid"> </td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="3" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><b>Fair Value Measurements Using</b></td>
<td colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p></td>
<td style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><b>Carrying Value</b></td>
<td style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><b>Level 1</b></td>
<td style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><b>Level 2</b></td>
<td style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><b>Level 3</b></td>
<td colspan="3" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><b>Total</b></td></tr>
<tr>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt">Derivative liability - warrants</td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  977,086</td>
<td style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  977,086</td>
<td colspan="3" style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  977,086</td></tr>
<tr>
<td style="vertical-align: bottom; border-bottom: windowtext 1pt solid; padding-right: -12.25pt; padding-left: 5.4pt">Derivative liability – conversion option</td>
<td style="vertical-align: bottom; border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">867,575</td>
<td style="vertical-align: top; border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td style="vertical-align: bottom; border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td style="vertical-align: bottom; border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">867,575</td>
<td colspan="3" style="vertical-align: bottom; border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">867,575</td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Total</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  1,844,661</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  1,844,661</td>
<td colspan="3" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  1,844,661</td></tr>
<tr>
<td style="width: 35%"> </td>
<td style="width: 11%"> </td>
<td style="width: 11%"> </td>
<td style="width: 12%"> </td>
<td style="width: 11%"> </td>
<td style="width: 1%"> </td>
<td style="width: 13%"> </td>
<td style="width: 6%"> </td></tr>
</table>
<table cellspacing="0" cellpadding="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<tr style="vertical-align: top">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p></td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="3" style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><b>Fair Value Measurements Using Level 3 Inputs</b></td></tr>
<tr style="vertical-align: top">
<td colspan="2" style="border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 4pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in"> </p></td>
<td style="border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><b>Derivative liability - warrants</b></td>
<td style="border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><b>Derivative liability – conversion option</b></td>
<td style="border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><b>Total</b></td></tr>
<tr>
<td colspan="2" style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt">Balance,  December 31, 2011 </td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  1,317,834 </td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$                   -<font style="letter-spacing: -0.1pt"> </font></td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  1,317,834 </td></tr>
<tr>
<td colspan="2" style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt">Additions during the year</td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">300,000 </td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">737,700 </td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  1,037,700 </td></tr>
<tr style="vertical-align: bottom">
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt">Total unrealized (gains) or losses included in net loss</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">(597,127)</font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">129,875 </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">(467,252)</font></td></tr>
<tr style="vertical-align: bottom">
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt">Debt settlement</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(43,621)</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">- </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  (43,621)</td></tr>
<tr>
<td colspan="2" style="vertical-align: bottom; border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Transfers in and/or out of Level 3</td>
<td style="vertical-align: top; border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">- </td>
<td style="vertical-align: top; border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">- </td>
<td style="vertical-align: top; border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">- </td></tr>
<tr>
<td colspan="2" style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt">Balance,  December 31, 2012 </td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  977,086 </td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">               867,575<font style="letter-spacing: -0.1pt"> </font></td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">1,844,661 </td></tr>
<tr>
<td colspan="2" style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt">Additions during the year</td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">206,000 </td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">810,500 </td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  1,016,500 </td></tr>
<tr style="vertical-align: bottom">
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt">Total unrealized (gains) or losses included in net loss</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">(1,042,582)</font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(1,095,775)</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">(2,138,357)</font></td></tr>
<tr>
<td colspan="2" style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt">Transfers in and/or out of Level 3</td>
<td style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">- </td>
<td style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">- </td>
<td style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">- </td></tr>
<tr style="vertical-align: bottom">
<td style="width: 35%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Balance, December 31, 2013</td>
<td style="width: 13%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="width: 19%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$       140,504 </td>
<td style="width: 20%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$     582,300<font style="letter-spacing: -0.1pt"> </font></td>
<td style="width: 13%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$    722,804 </td></tr>
</table>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: top">
<td style="width: 35%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: left"> </td>
<td style="width: 15%; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Face Value</b></p></td>
<td style="width: 18%; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Principal Repayment/</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Settlement/Re-issued</b></p></td>
<td style="width: 16%; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Unamortized</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Note</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Discount</b></p></td>
<td style="width: 16%; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Balance at</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>December 31,</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>2013</b></p></td></tr>
<tr style="vertical-align: bottom">
<td style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">February 2011 Secured Convertible Notes</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Senior Secured Notes, due February 24, 2014</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  1,184,694<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">$         203,836  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">$    20,083 </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  960,775<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">April 2011 Secured Convertible Notes</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Senior Secured Notes, due April 4, 2014</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  215,000<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    8,835 </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  206,165<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">June 2011 Secured Convertible Note</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Senior Secured Notes, due June 6, 2014</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  30,000<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    1,189 </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  28,811<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">August 8, 2012 Convertible Note</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Note due August 8, 2013</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  111,430<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         111,430  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    - </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  -<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">August 12, 2012 Convertible Note</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Note became due November 12, 2012</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  27,500<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">27,500<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">August 20, 2012 Convertible Note</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Note due August 20, 2013</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  20,000<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  20,000<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">September 18, 2012 Convertible Note</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Note due October 1, 2013</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  82,500<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         82,500  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    - </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  <font style="letter-spacing: -0.1pt">    - </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">October 2012 Convertible Note</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Note due October 15, 2013</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  340,000<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">             -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  340,000<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">October 9, 2012 Convertible Notes</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  100,000<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         100,000  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    - </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  -<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Note due April 30, 2013</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">November 1, 2012 Convertible Note</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Note due April 30, 2013</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  31,471<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         31,471  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  -<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">November 20, 2012 Convertible Note</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt">Note due November 20, 2013</td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  55,710<font style="letter-spacing: -0.1pt"> </font></td>
<td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         44,962  </font></td>
<td style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">        -  </font></td>
<td style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    10,748  </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">December 14, 2012 Convertible Note</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Note due April 18, 2013</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  189,210<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         189,210  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -</font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  <font style="letter-spacing: -0.1pt">-</font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">December 18, 2012 Convertible Note</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Note due December 14, 2013</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  50,000<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    - </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  50,000<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><b>January 5, 2013 Convertible Notes</b></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  567,729<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         115,000  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    - </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  452,729<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">January 31, 2013 Convertible Notes</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  24,135<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    - </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  24,135<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><b>February 27, 2013 Convertible Note</b></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Note due February 27, 2014</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  58,500<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    8,819 </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  49,681<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><b>April 2, 2013 Convertible Notes</b></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  80,967<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    - </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  80,967<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><b>April 18, 2013 Convertible Note</b></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Note due December 18, 2013</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  60,000<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         28,312  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    - </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  31,688<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><b>May 2, 2013 Convertible Notes</b></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  50,000<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    - </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  50,000<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><b>May 5, 2013 Convertible Notes</b></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  45,000<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    - </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  45,000<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><b>May 14, 2013 Convertible Note</b></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Note due May 14, 2014</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  126,000<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    46,258 </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  79,742<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><b>June 27, 2013 Convertible Note</b></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Note due June 27, 2014</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  37,620<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    17,515 </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  20,105<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><b>June 19, 2013 Convertible Note</b></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Note due June 19, 2014</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  115,000<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         83,000  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    8,217 </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  23,783<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><b>July 12, 2013 Convertible Note</b></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Note due July 12, 2014</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  125,000<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         28,200  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    57,200 </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  39,600<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><b>October, 2013 Convertible Notes</b></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Notes due in April, 2014</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  94,444<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         - </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    56,044 </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  38,400<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><b>November, 2013 Convertible Notes</b></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Notes due in May, 2014</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  85,000<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">                  - </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    57,996 </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  27,004<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><b>December, 2013 Convertible Notes I</b></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Notes due May, 2014</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  277,222<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">                  - </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    258,478 </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  18,744<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><b>December, 2013 Convertible Notes II</b></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Notes due May, 2014</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  536,400<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">                  - </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    - </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  536,400<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><b>Total</b></td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  4,720,532<font style="letter-spacing: -0.1pt"> </font></td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">$         1,017,921</font></td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">$    540,634 </font></td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  3,161,977<font style="letter-spacing: -0.1pt"> </font></td></tr>
</table>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: top">
<td style="width: 43%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: left"> </td>
<td style="width: 12%; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Face Value</b></p></td>
<td style="width: 15%; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Principal Repayment/</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Settlement</b></p></td>
<td style="width: 15%; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Unamortized</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Note</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Discount</b></p></td>
<td style="width: 15%; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Balance at</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>December 31,</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>2012</b></p></td></tr>
<tr style="vertical-align: bottom">
<td style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">February 2011 Secured Convertible Notes</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Senior Secured Notes, due February 24, 2014</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  1,184,694<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">$         203,836  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">$    153,358 </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  827,500<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">April 2011 Secured Convertible Notes</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Senior Secured Notes, due April 4, 2014</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  215,000<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    43,140 </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  171,860<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">June 2011 Secured Convertible Note</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Senior Secured Notes, due June 6, 2014</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  30,000<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    3,953 </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  26,047<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">August 8, 2012 Convertible Note</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Note due August 8, 2013</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  111,430<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    67,163 </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  44,267<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">August 12, 2012 Convertible Note</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Note became due November 12, 2012</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  27,500<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">- </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">27,500<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">August 20, 2012 Convertible Note</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Note due August 20, 2013</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  20,000<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    12,712 </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  7,288<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">September 18, 2012 Convertible Note</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Note due October 1, 2013</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  82,500<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    59,741 </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  22,759<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">October 9, 2012 Convertible Notes</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Note due April 30, 2013</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  100,000<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    - </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  100,000<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">October 2012 Convertible Note</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Note due October 15, 2013</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  340,000<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    268,275 </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  71,725<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">November 1, 2012 Convertible Note</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Note due April 30, 2013</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  31,471<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    18,200  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  13,271<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">November 20, 2012 Convertible Note</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Note due November 20, 2013</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  55,710<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    49,605 </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  6,105<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">December 14, 2012 Convertible Note</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Note due April 18, 2013</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  189,210<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    81,302  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  107,908<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">December 18, 2012 Convertible Note</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Note due December 14, 2013</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  50,000<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">         -  </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">    - </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">  50,000<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: bottom">
<td style="border-top: windowtext 1.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Total</td>
<td style="border-top: windowtext 1.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  2,437,515<font style="letter-spacing: -0.1pt"> </font></td>
<td style="border-top: windowtext 1.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">$         203,836  </font></td>
<td style="border-top: windowtext 1.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">$    757,449 </font></td>
<td style="border-top: windowtext 1.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  1,476,230<font style="letter-spacing: -0.1pt"> </font></td></tr>
</table>
277222
1184694
215000
30000
111430
27500
20000
82500
340000
31471
55710
252280
50000
567729
58500
80967
60000
50000
45000
126000
37620
125000
94444
85000
250000
944694
190000
92000
25000
69000
310000
50000
46000
50000
110000
30000
110000
85030
77000
10%
10%
10%
10%
10%
8%
8%
20%
5%
8%
9%
5%
8%
8%
10%
8%
8%
5%
8%
10%
10%
41500
4550
8000
6000
10000
4000
4000
5000
5000
3000
15000
23694
4300
600
500
30000
20000
41667
277222
483355
130720
8280
31100
36100
76400
248000
27300
69000
94100
44700
27800
115000
30200
114000
94444
85000
701339
84280
21720
155700
62000
4171
19000
95110
5300
27200
96000
2800
104000
203836
81360
16419
27222
11430
2500
7500
30000
5710
22025
8500
5000
4620
11000
9414
8000
382000
100000
24134
25.00
25.00
25.00
25.00
42200
10000
10%
67942
210000
1400000
369345
373346
373200
5200
10%
691845
<table cellspacing="0" cellpadding="0" style="width: 100%; border-collapse: collapse; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td style="width: 47%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-top: 12pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="width: 17%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Number of</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Options</p></td>
<td style="width: 18%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Weighted Average</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Exercise Price</p></td>
<td style="width: 18%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Weighted Average</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Remaining Life</p></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td></tr>
<tr>
<td style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt"><b>Balance, December 31, 2011</b></td>
<td style="vertical-align: bottom; padding-right: 6.45pt; padding-left: 5.4pt; text-align: right">62,780 </td>
<td style="vertical-align: bottom; padding-right: 18.8pt; padding-left: 5.4pt; text-align: right">$  18.00</td>
<td style="vertical-align: bottom; padding-right: 21.95pt; padding-left: 5.4pt; text-align: right">6.85</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">  Issued</td>
<td style="padding-right: 6.45pt; padding-left: 5.4pt; text-align: right">5,150 </td>
<td style="padding-right: 18.8pt; padding-left: 5.4pt; text-align: right">17.00</td>
<td style="padding-right: 21.95pt; padding-left: 5.4pt; text-align: right">9.35</td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">  Cancelled/Forfeited</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 6.45pt; padding-left: 5.4pt; text-align: right">(2,500)</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 18.8pt; padding-left: 5.4pt; text-align: right">35.00</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 21.95pt; padding-left: 5.4pt; text-align: right">-</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 6.45pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 18.8pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 21.95pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><b>Balance, December 31, 2012</b></td>
<td style="padding-right: 6.45pt; padding-left: 5.4pt; text-align: right">65,430 </td>
<td style="padding-right: 18.8pt; padding-left: 5.4pt; text-align: right">  18.00</td>
<td style="padding-right: 21.95pt; padding-left: 5.4pt; text-align: right">6.05</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">  Issued</td>
<td style="padding-right: 6.45pt; padding-left: 5.4pt; text-align: right">- </td>
<td style="padding-right: 18.8pt; padding-left: 5.4pt; text-align: right">- </td>
<td style="padding-right: 21.95pt; padding-left: 5.4pt; text-align: right">- </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">  Cancelled/Forfeited</td>
<td style="padding-right: 6.45pt; padding-left: 5.4pt; text-align: right">- </td>
<td style="padding-right: 18.8pt; padding-left: 5.4pt; text-align: right">- </td>
<td style="padding-right: 21.95pt; padding-left: 5.4pt; text-align: right">- </td></tr>
<tr style="vertical-align: bottom">
<td style="border-top: windowtext 1pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><b>Balance, December 31, 2013 </b></td>
<td style="border-top: windowtext 1pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 6.45pt; padding-left: 5.4pt; text-align: right">65,430 </td>
<td style="border-top: windowtext 1pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 18.8pt; padding-left: 5.4pt; text-align: right">$  18.00</td>
<td style="border-top: windowtext 1pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 21.95pt; padding-left: 5.4pt; text-align: right">5.04</td></tr>
</table>
<table cellspacing="0" cellpadding="0" style="width: 100%; border-collapse: collapse; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td style="width: 47%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-top: 12pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="width: 17%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-top: 12pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="width: 18%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Number of</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Shares</p></td>
<td style="width: 18%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Weighted Average</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Grant-Date</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Fair Value</p></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><b>Unvested, December 31, 2012</b></td>
<td style="padding-right: 6.45pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.3pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">3,796 </font></td>
<td style="padding-right: 21.95pt; padding-left: 5.4pt; text-align: right">$  18.00</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">  Granted</td>
<td style="padding-right: 6.45pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.3pt; padding-left: 5.4pt; text-align: right">-<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 21.95pt; padding-left: 5.4pt; text-align: right">-</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">  Vested</td>
<td style="padding-right: 6.45pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.3pt; padding-left: 5.4pt; text-align: right">(2,685)</td>
<td style="padding-right: 21.95pt; padding-left: 5.4pt; text-align: right">18.00</td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">  Cancelled</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 6.45pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.3pt; padding-left: 5.4pt; text-align: right">-<font style="letter-spacing: -0.1pt"> </font></td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 21.95pt; padding-left: 5.4pt; text-align: right">-</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 6.45pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.3pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 21.95pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><b>Unvested, December 31, 2013</b></td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 6.45pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.3pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">1,111 </font></td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 21.95pt; padding-left: 5.4pt; text-align: right">$  16.00</td></tr>
</table>
<table cellspacing="0" cellpadding="0" style="width: 100%; border-collapse: collapse; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td style="width: 44%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><font style="letter-spacing: -0.1pt"> </font></td>
<td style="width: 18%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Number of</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Warrants</p></td>
<td style="width: 19%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Weighted Average</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Exercise Price</p></td>
<td style="width: 19%; border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Weighted Average</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Remaining Life</p></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td></tr>
<tr>
<td style="vertical-align: top; border-top: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><b>Balance, December 31, 2011</b></td>
<td style="vertical-align: bottom; border-top: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">121,064 </td>
<td style="vertical-align: bottom; border-top: windowtext 1pt solid; padding-right: 20.4pt; padding-left: 5.4pt; text-align: right">$  56.00</td>
<td style="vertical-align: bottom; border-top: windowtext 1pt solid; padding-right: 23.5pt; padding-left: 5.4pt; text-align: right">2.81</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">  Issued</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">55,167 </td>
<td style="padding-right: 20.4pt; padding-left: 5.4pt; text-align: right">26.00</td>
<td style="padding-right: 23.5pt; padding-left: 5.4pt; text-align: right">3.32</td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">  Exercised, cancelled or expired</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(7,144)</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 20.4pt; padding-left: 5.4pt; text-align: right">233.00</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 23.5pt; padding-left: 5.4pt; text-align: right">-</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><b>Balance, December 31, 2012</b></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">169,087 </td>
<td style="padding-right: 20.4pt; padding-left: 5.4pt; text-align: right">  39.00</td>
<td style="padding-right: 23.5pt; padding-left: 5.4pt; text-align: right">2.19</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">  Issued</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">67,667 </td>
<td style="padding-right: 20.4pt; padding-left: 5.4pt; text-align: right">5.84</td>
<td style="padding-right: 23.5pt; padding-left: 5.4pt; text-align: right">4.16</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">  Exercised</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(30,000)</td>
<td style="padding-right: 20.4pt; padding-left: 5.4pt; text-align: right">25.00</td>
<td style="padding-right: 23.5pt; padding-left: 5.4pt; text-align: right">-</td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt">  Extinguished or expired</td>
<td style="border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(57,302)</td>
<td style="border-bottom: windowtext 1pt solid; padding-right: 20.4pt; padding-left: 5.4pt; text-align: right">39.72</td>
<td style="border-bottom: windowtext 1pt solid; padding-right: 23.5pt; padding-left: 5.4pt; text-align: right">-</td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><b>Balance, December 31, 2013 </b></td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">149,452 </td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 20.4pt; padding-left: 5.4pt; text-align: right">$  25.85</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 23.5pt; padding-left: 5.4pt; text-align: right">2.76</td></tr>
</table>
50000000
80000000
2500
100000
0.001
10.01
5000000
50000000
200000000
200000000
2313
3333
36550
28925
10010
21230
50000
15.80
11.60
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="width: 56%; border-top: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="width: 22%; border-top: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Year Ended</td>
<td style="width: 22%; border-top: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Year Ended</td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">December 31, 2013</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">December 31, 2012</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Loss before income taxes</td>
<td style="padding-top: 12pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  (5,532,552)</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  (6,171,867)</td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Corporate tax rate</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-top: 12pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">35.00%</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">35.00%</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Expected tax recovery</td>
<td style="padding-top: 12pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(1,936,393)</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(2,160,153)</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Increase (decrease) resulting from:</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">  Permanent differences</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">626,270 </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">384,590 </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">  Other items</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(3,908)</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(3,908)</td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">  Change in valuation allowance</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">1,314,031 </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">1,779,471 </td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Income tax recovery</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$                 - </td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$                  - </td></tr>
</table>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="width: 63%; border-top: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="width: 18%; border-top: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Year Ended</td>
<td style="width: 19%; border-top: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Year Ended</td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">December 31, 2013</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">December 31, 2012</td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Deferred tax assets:</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">  Stock option expense</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  2,730,750 </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$  2,730,750 </td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">  Loss carry-forwards and tax pools</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">11,078,782 </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">9,585,489 </td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">  Valuation allowance</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(13,809,532)</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(12,316,239)</td></tr>
<tr style="vertical-align: bottom">
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Net deferred income tax assets</td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$                 - </td>
<td style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$                 - </td></tr>
</table>
22154000
18713000
<p style="margin: 0pt"> </p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 0"><font style="text-transform: uppercase">Note 11:	Supplemental
Cash Flow Information AND NON-CASH INVESTING AND FINANCING ACTIVITIES </font></p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td nowrap="nowrap" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="3" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr>
<td nowrap="nowrap" style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td colspan="2" style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td nowrap="nowrap" colspan="3" style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td colspan="5" style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Year Ended</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">December 31, 2013</p></td>
<td style="border-bottom: windowtext 0.5pt solid"> </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td nowrap="nowrap" colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td nowrap="nowrap" colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><font style="color: black">Shares/warrants</font></td>
<td nowrap="nowrap" colspan="3" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><font style="color: black">Amount</font></td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><font style="color: black">       $</font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="color: black">Shares issued pursuant to consulting arrangements</font></td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">3,500 </font></td>
<td nowrap="nowrap" colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">38,935</font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="color: black">Shares issued pursuant to debt settlement agreements</font></td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">184,649</font></td>
<td nowrap="nowrap" colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">400,472</font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="color: black">Shares issued pursuant to settlement agreements</font></td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">82,500</font></td>
<td nowrap="nowrap" colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">118,275</font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="color: black">Shares issued pursuant to notes conversion</font></td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">362,047 </font></td>
<td nowrap="nowrap" colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">737,520</font></td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="3" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="3" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr>
<td nowrap="nowrap" colspan="2" style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td colspan="3" style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td nowrap="nowrap" colspan="3" style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td colspan="4" style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Year Ended</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">December 31, 2012</p></td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td nowrap="nowrap" colspan="3" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><font style="color: black">Shares/warrants</font></td>
<td nowrap="nowrap" colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><font style="color: black">Amount</font></td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="color: black">               $   </font></td></tr>
<tr style="vertical-align: bottom">
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="color: black">Shares issued pursuant to consulting arrangements</font></td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">145,352 </font></td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">1,998,000</font></td></tr>
<tr style="vertical-align: bottom">
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="color: black">Shares issued pursuant to debt settlement agreements</font></td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">30,145 </font></td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">348,282</font></td></tr>
<tr style="vertical-align: bottom">
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="color: black">Shares issued for interest and penalties</font></td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">16,531</font></td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">    245,717</font></td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="3" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr>
<td style="width: 54%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 3%"> </td>
<td style="width: 1%"> </td>
<td style="width: 6%"> </td>
<td style="width: 2%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 15%"> </td>
<td style="width: 1%"> </td>
<td style="width: 7%"> </td>
<td style="width: 6%"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">Pursuant to the February 2011 Note settlement
agreement entered during the year ended December 31, 2012, the Company issued December 14, 2012 Notes in the amount of $252,280
of which $220,255 was deemed to be for partial settlement of the February 2011 Note.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">Pursuant to the promissory note settlement
agreement entered during the year ended December 31, 2012, the Company issued November 1, 2012 Notes in the amount of $105,000
which was deemed to be full settlement of the promissory note (Note 7).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify">See Notes 5 and 9 for additional disclosure
on non-cash transactions.</p>
<table cellspacing="0" cellpadding="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<tr style="vertical-align: top">
<td rowspan="2" style="border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p></td>
<td colspan="2" style="border-top: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">                        Year Ended December 31,</td></tr>
<tr style="vertical-align: top">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">2013</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">2012</td></tr>
<tr>
<td style="vertical-align: top; width: 64%; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="vertical-align: bottom; width: 18%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="vertical-align: bottom; width: 18%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td></tr>
<tr>
<td style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt">Interest paid in cash</td>
<td style="vertical-align: bottom; padding-right: 12.4pt; padding-left: 5.4pt; text-align: right">$  -</td>
<td style="vertical-align: bottom; padding-right: 15.9pt; padding-left: 5.4pt; text-align: right">$  -</td></tr>
<tr>
<td style="vertical-align: top; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Income taxes paid</td>
<td style="vertical-align: bottom; border-bottom: windowtext 1.5pt solid; padding-right: 12.4pt; padding-left: 5.4pt; text-align: right">$  -</td>
<td style="vertical-align: bottom; border-bottom: windowtext 1.5pt solid; padding-right: 15.9pt; padding-left: 5.4pt; text-align: right">$  -</td></tr>
</table>
<p style="margin: 0pt"></p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td nowrap="nowrap" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="3" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr>
<td nowrap="nowrap" style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td colspan="2" style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td nowrap="nowrap" colspan="3" style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td colspan="5" style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Year Ended</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">December 31, 2013</p></td>
<td style="border-bottom: windowtext 0.5pt solid"> </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td nowrap="nowrap" colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td nowrap="nowrap" colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><font style="color: black">Shares/warrants</font></td>
<td nowrap="nowrap" colspan="3" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><font style="color: black">Amount</font></td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><font style="color: black">       $</font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="color: black">Shares issued pursuant to consulting arrangements</font></td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">3,500 </font></td>
<td nowrap="nowrap" colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">38,935</font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="color: black">Shares issued pursuant to debt settlement agreements</font></td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">184,649</font></td>
<td nowrap="nowrap" colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">400,472</font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="color: black">Shares issued pursuant to settlement agreements</font></td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">82,500</font></td>
<td nowrap="nowrap" colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">118,275</font></td></tr>
<tr style="vertical-align: bottom">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="color: black">Shares issued pursuant to notes conversion</font></td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">362,047 </font></td>
<td nowrap="nowrap" colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">737,520</font></td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="3" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="3" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr>
<td nowrap="nowrap" colspan="2" style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td colspan="3" style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td nowrap="nowrap" colspan="3" style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td colspan="4" style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Year Ended</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">December 31, 2012</p></td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td nowrap="nowrap" colspan="3" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><font style="color: black">Shares/warrants</font></td>
<td nowrap="nowrap" colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><font style="color: black">Amount</font></td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="color: black">               $   </font></td></tr>
<tr style="vertical-align: bottom">
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="color: black">Shares issued pursuant to consulting arrangements</font></td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">145,352 </font></td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">1,998,000</font></td></tr>
<tr style="vertical-align: bottom">
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="color: black">Shares issued pursuant to debt settlement agreements</font></td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">30,145 </font></td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">348,282</font></td></tr>
<tr style="vertical-align: bottom">
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="color: black">Shares issued for interest and penalties</font></td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">16,531</font></td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="color: black">    245,717</font></td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="3" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr>
<td style="width: 54%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 3%"> </td>
<td style="width: 1%"> </td>
<td style="width: 6%"> </td>
<td style="width: 2%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 15%"> </td>
<td style="width: 1%"> </td>
<td style="width: 7%"> </td>
<td style="width: 6%"> </td></tr>
</table>
<table cellspacing="0" cellpadding="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<tr style="vertical-align: top">
<td rowspan="2" style="border-top: windowtext 1.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p></td>
<td colspan="2" style="border-top: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">                        Year Ended December 31,</td></tr>
<tr style="vertical-align: top">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">2013</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">2012</td></tr>
<tr>
<td style="vertical-align: top; width: 64%; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="vertical-align: bottom; width: 18%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td style="vertical-align: bottom; width: 18%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td></tr>
<tr>
<td style="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt">Interest paid in cash</td>
<td style="vertical-align: bottom; padding-right: 12.4pt; padding-left: 5.4pt; text-align: right">$  -</td>
<td style="vertical-align: bottom; padding-right: 15.9pt; padding-left: 5.4pt; text-align: right">$  -</td></tr>
<tr>
<td style="vertical-align: top; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Income taxes paid</td>
<td style="vertical-align: bottom; border-bottom: windowtext 1.5pt solid; padding-right: 12.4pt; padding-left: 5.4pt; text-align: right">$  -</td>
<td style="vertical-align: bottom; border-bottom: windowtext 1.5pt solid; padding-right: 15.9pt; padding-left: 5.4pt; text-align: right">$  -</td></tr>
</table>
105000
252280
220255
<table cellspacing="0" cellpadding="0" style="width: 100%; border-collapse: collapse; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td style="width: 76%"> </td>
<td style="width: 4%; text-align: center"> </td>
<td style="width: 1%; text-align: center"> </td>
<td style="width: 17%; text-align: center"> </td>
<td style="width: 2%; text-align: center"> </td></tr>
<tr style="vertical-align: bottom">
<td>2014</td>
<td> </td>
<td>$</td>
<td style="text-align: right">7,152</td>
<td> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td style="border-bottom: windowtext 1.5pt solid">$</td>
<td style="border-bottom: windowtext 1.5pt solid; text-align: right">7,152</td>
<td> </td></tr>
</table>
841000
510000
330000
180000
20000
19.00
12000
17.00
10000
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> December 31, 2013 </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" colspan="2" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> December 31, 2012 </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" style="width: 17%; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="width: 8%; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="width: 15%; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="width: 31%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">                        $ </td>
<td nowrap="nowrap" style="width: 9%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td>
<td nowrap="nowrap" style="width: 18%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">               $ </td>
<td nowrap="nowrap" style="width: 2%; padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> Trade accounts payable </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">               1,510,421 </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">               1,663,315 </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> Accrued liabilities </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">                  1,490,908 </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">                  142,245 </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> Employee payroll </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">                  219,040 </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">                    61,458 </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> Accrued interest </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">                  558,032 </td>
<td nowrap="nowrap" style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">                    74,698 </td>
<td nowrap="nowrap" style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">                  3,778,401 </td>
<td nowrap="nowrap" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">               1,941,716 </td>
<td nowrap="nowrap" style="border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">                             </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td nowrap="nowrap" style="border-top: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> </td></tr>
</table>
1348663
<table cellspacing="0" cellpadding="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<tr style="vertical-align: top">
<td colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">As reported </td>
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">Adjustment </td>
<td colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">As restated </td></tr>
<tr style="vertical-align: top">
<td colspan="8" style="padding-right: 5.4pt; padding-left: 5.4pt"><b>Balance sheet data — December 31, 2012 </b></td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td></tr>
<tr style="vertical-align: top">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Cash </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">50,679<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$</td>
<td colspan="2" style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(16,840)</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">33,839<font style="letter-spacing: -0.1pt"> </font> </td></tr>
<tr style="vertical-align: top">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Total Assets</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">104,212<font style="letter-spacing: -0.1pt"> </font></td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(16,840)</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">87,372<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Accounts payable and accrued liabilities </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">2,058,556<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(116,840)</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">1,941,716<font style="letter-spacing: -0.1pt"> </font> </td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Derivative liability – conversion option </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">798,300<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">69,275<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">867,575<font style="letter-spacing: -0.1pt"> </font> </td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Derivative liability - warrants</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">677,086  </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">300,000<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">977,086<font style="letter-spacing: -0.1pt"> </font>   </td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Convertible notes payable</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">1,376,230  </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">100,000<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">1,476,230  </td></tr>
<tr style="vertical-align: top">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Due to related parties</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">366,697<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">6,649<font style="letter-spacing: -0.1pt"> </font></td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">373,346<font style="letter-spacing: -0.1pt"> </font> </td></tr>
<tr style="vertical-align: top">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Total liabilities</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">5,770,809<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">359,084<font style="letter-spacing: -0.1pt"> </font></td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">6,129,893<font style="letter-spacing: -0.1pt"> </font> </td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Additional paid-in capital</td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">43,545,947<font style="letter-spacing: -0.1pt"> </font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">(62,000)</font></td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="letter-spacing: -0.1pt">43,483,947 </font></td></tr>
<tr style="vertical-align: top">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Deficit accumulated during the development stage</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(49,580,159)</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(313,924)</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(49,894,083)</td></tr>
<tr style="vertical-align: top">
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Stockholders’ deficiency</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(5,666,597) </td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$</td>
<td colspan="2" style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(375,924)</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$</td>
<td style="border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(6,042,521) </td></tr>
<tr style="vertical-align: top">
<td colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">As reported </td>
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">Adjustment </td>
<td colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">As restated </td></tr>
<tr style="vertical-align: top">
<td colspan="8" style="padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>Consolidated Statement of Operations data </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>For the year ended December 31, 2012</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p></td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Management fees </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$ </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">295,600<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$ </td>
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">6,649<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$ </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">302,249<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: top">
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Net Loss Before Other Items</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(6,222,798)</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(6,649)</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(6,229,447)</td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Changes in fair value of derivative liabilities </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">536,527<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(307,375) </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">229,252<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: top">
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><b>NET LOSS </b></td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(5,857,943)</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$</td>
<td colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(313,924)</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(6,171,867)</td></tr>
<tr style="vertical-align: top">
<td colspan="8" style="padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p></td></tr>
<tr>
<td style="width: 54%"> </td>
<td style="width: 3%"> </td>
<td style="width: 12%"> </td>
<td style="width: 4%"> </td>
<td style="width: 11%"> </td>
<td style="width: 1%"> </td>
<td style="width: 3%"> </td>
<td style="width: 12%"> </td></tr>
</table>
<table cellspacing="0" cellpadding="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<tr style="vertical-align: top">
<td colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">As reported </td>
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">Adjustment </td>
<td colspan="3" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">As restated </td></tr>
<tr style="vertical-align: top">
<td colspan="8" style="padding-right: 5.4pt; padding-left: 5.4pt">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>Consolidated Statement of Operations data </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>From July 27, 1999 (inception) to December 31, 2012</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p></td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Management fees </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$ </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">3,067,654<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$ </td>
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">6,649<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$ </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">3,074,303<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: top">
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt">Net Loss Before Other Items</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(41,491,894)</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(6,649)</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 0.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(41,498,543)</td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 5.4pt; padding-left: 5.4pt">Changes in fair value of derivative liabilities </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">4,611,667<font style="letter-spacing: -0.1pt"> </font> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td colspan="2" style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(307,375) </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"> </td>
<td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">4,304,392<font style="letter-spacing: -0.1pt"> </font></td></tr>
<tr style="vertical-align: top">
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><b>NET LOSS </b></td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(49,580,159)</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$</td>
<td colspan="2" style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(313,924)</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">$</td>
<td style="border-top: windowtext 0.5pt solid; border-bottom: windowtext 1.5pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">(49,894,083)</td></tr>
<tr>
<td style="width: 54%"> </td>
<td style="width: 3%"> </td>
<td style="width: 12%"> </td>
<td style="width: 4%"> </td>
<td style="width: 11%"> </td>
<td style="width: 1%"> </td>
<td style="width: 3%"> </td>
<td style="width: 12%"> </td></tr>
</table>
1200000
150000000
168787
244764
100000
500000000
1500000
0.001
5000
145000
127040
214446
450000
4.00
2500000
3.65