0001085277
2013-01-01
2013-06-30
0001085277
2013-06-30
0001085277
2012-12-31
0001085277
2013-04-01
2013-06-30
0001085277
2012-04-01
2012-06-30
0001085277
2012-01-01
2012-06-30
0001085277
2011-12-31
0001085277
2012-06-30
0001085277
SKVI:AsPreviouslyReportedMember
2013-01-01
2013-06-30
0001085277
SKVI:ErrorCorrectionMember
2013-01-01
2013-06-30
0001085277
SKVI:AsRestatedMember
2013-01-01
2013-06-30
0001085277
SKVI:AsPreviouslyReportedMember
2013-06-30
0001085277
SKVI:ErrorCorrectionMember
2013-06-30
0001085277
SKVI:AsRestatedMember
2013-06-30
0001085277
SKVI:AsPreviouslyReportedMember
2013-04-01
2013-06-30
0001085277
SKVI:ErrorCorrectionMember
2013-04-01
2013-06-30
0001085277
SKVI:AsRestatedMember
2013-04-01
2013-06-30
0001085277
2013-01-01
2013-03-31
0001085277
SKVI:ConvertibleNote1Member
2013-01-01
2013-06-30
0001085277
SKVI:ConvertibleNote2Member
2013-01-01
2013-06-30
0001085277
SKVI:ConvertibleNote3Member
2013-01-01
2013-06-30
0001085277
SKVI:ConvertibleNote3Member
2012-01-01
2012-12-31
0001085277
SKVI:ConvertibleNotePayableRelatedParty1Member
2010-12-31
0001085277
SKVI:ConvertibleNotePayableRelatedParty1Member
2011-07-01
0001085277
SKVI:ConvertibleNotePayableRelatedParty1Member
2011-12-31
0001085277
SKVI:ConvertibleNotePayableRelatedParty1Member
2013-06-30
0001085277
SKVI:ConvertibleNotePayableRelatedParty2Member
2012-06-30
0001085277
SKVI:ConvertibleNotePayableRelatedParty2Member
2013-06-30
0001085277
SKVI:ConvertibleNotePayableRelatedParty3Member
2012-12-31
0001085277
SKVI:ConvertibleNotePayableRelatedParty3Member
2013-06-30
0001085277
SKVI:ConvertibleNotePayableRelatedParty4Member
2013-06-30
0001085277
2013-07-01
2013-07-31
iso4217:USD
xbrli:shares
iso4217:USD
xbrli:shares
xbrli:pure
SKINVISIBLE INC
0001085277
10-Q
2013-06-30
false
--12-31
No
No
Yes
Smaller Reporting Company
Q2
2013
110489969
0.001
0.001
200000000
200000000
110490969
109507409
-322141
-318519
75709
102200
583937
166423
164022
70768
985150
1036956
229721
213205
380076
450507
1218
6705
10500
27299
22264
18769
1145
1145
515
515
414500
498235
4227
4459
317211
251553
735938
754247
543167
636314
701466
723916
128546
25264
5551
21412
134
7661
19984
10265
430000
1991
1089877
1088386
150167
154349
738711
593227
745517
343362
526666
158599
18061
35384
19792
2930435
2372635
1845138
1475757
2930435
2372635
110490
109507
20954233
20841670
20169778
20616799
-23261020
-22571365
-21765859
-21843499
-2194497
-1618388
-1487059
-1117678
735938
754247
1800
1800
34735
7448
30550
60628
1189
1031
1068
1944
33546
6417
29482
58684
17182
9047
17895
35614
396146
244628
363968
679333
598949
679333
306016
363968
413328
253675
381863
714947
634563
714947
323911
381863
-379782
-247258
-352381
-656263
-575879
-656263
-294429
-352381
-310573
-145550
-35272
-70020
700
1727
2563
1727
836
-309873
-145550
-35272
-68293
-689655
-392808
-387653
-724556
-646916
-724556
-332445
-387653
-0.01
-0.00
-0.00
-0.01
-0.00
-0.00
-0.00
0.00
0.00
0.00
110217662
110450409
105275699
102762334
149065
267444
218603
267444
217652
217445
217652
76009
82984
76009
-700
-1727
-2563
-1727
-33456
102146
21412
5551
21412
-387821
-83807
-82608
-50690
-82608
-50690
-7527
7584
101400
10000
430000
31000
-70431
5487
23554
-9719
23554
76009
288069
19385
111110
12800
422
-3495
1752
16799
-8895
27407
99944
77494
99944
-19792
-35000
-12475
399998
139984
3696
13700
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Description
of business</u> – Skinvisible, Inc., (referred to as the “Company”) is focused on the development and manufacture
of innovative topical, transdermal and mucosal polymer-based delivery system technologies and formulations incorporating its patent-pending
formula/process for combining hydrophilic and hydrophobic polymer emulsions. The technologies and formulations have broad industry
applications within the pharmaceutical, over-the-counter, personal skincare and cosmetic arenas. Additionally, the Company’s
non-dermatological formulations, offer solutions for a broad spectrum of markets women’s health, pain management, and others.
The Company maintains executive and sales offices in Las Vegas, Nevada.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>History
</u>– Skinvisible, Inc. (referred to as the “Company”) was incorporated in Nevada on March 6, 1998 under the name
of Microbial Solutions, Inc. The Company underwent a name change on February 26, 1999, when it changed its name to Skinvisible,
Inc. The Company’s subsidiary’s name of Manloe Labs, Inc. was also changed to Skinvisible Pharmaceuticals, Inc.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Skinvisible,
Inc. together with its subsidiary shall herein be collectively referred to as the “Company”.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Going
concern </u>– The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization
of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred cumulative net losses
of $23,261,020 since its inception and requires capital for its contemplated operational and marketing activities to take place.
The Company’s ability to raise additional capital through the future issuances of common stock is unknown. The obtainment
of additional financing, the successful development of the Company’s contemplated plan of operations, and its transition,
ultimately, to the attainment of profitable operations are necessary for the Company to continue operations. The ability to successfully
resolve these factors raises substantial doubt about the Company’s ability to continue as a going concern. The consolidated
financial statements of the Company do not include any adjustments that may result from the outcome of these aforementioned uncertainties.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Principles
of consolidation</u> – The consolidated financial statements include the accounts of the Company and its subsidiary. All
significant intercompany balances and transactions have been eliminated.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Use
of estimates </u>– The preparation of consolidated financial statements in conformity with accounting principles generally
accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the
reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Cash
and cash equivalents</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">For
purposes of the statement of cash flows, the Company considers all highly liquid investments and short-term debt instruments with
original maturities of three months or less to be cash equivalents.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Fair
Value of Financial Instruments</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The
carrying amounts reflected in the balance sheets for cash, accounts payable and accrued expenses approximate the respective fair
values due to the short maturities of these items.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">As
required by the Fair Value Measurements and Disclosures Topic of the FASB ASC, fair value is measured based on a three-tier fair
value hierarchy, which prioritizes the inputs used in measuring fair value as follows: (Level 1) observable inputs such as quoted
prices in active markets; (Level 2) inputs, other than the quoted prices in active markets, that are observable either directly
or indirectly; and (Level 3) unobservable inputs in which there is little or no market data, which require the reporting entity
to develop its own assumptions.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The
three levels of the fair value hierarchy are described below:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Level
1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or
liabilities;</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Level
2: Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially
the full term of the asset or liability;</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Level
3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable
(supported by little or no market activity). </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Revenue
recognition</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Product
sales</u> – Revenues from the sale of products (Invisicare® polymers) are recognized when title to the products are
transferred to the customer and only when no further contingencies or material performance obligations are warranted, and thereby
have earned the right to receive reasonably assured payments for products sold and delivered.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Royalty
sales</u> – The Company also recognizes royalty revenue from licensing its patented product formulations only when earned,
when no further contingencies or material performance obligations are warranted, and thereby have earned the right to receive
and retain reasonably assured payments.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; text-align: justify; margin-right: 0; margin-left: 0.5in"><font style="font: 10pt Times New Roman, Times, Serif"><u>Distribution
and license rights sales</u> – The Company also recognizes revenue from distribution and license rights only when earned
(and are amortized over a five year period), when no further contingencies or material performance obligations are warranted,
and thereby have earned the right to receive and retain reasonably assured payments.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; text-align: justify; margin-right: 0; margin-left: 0.5in"><font style="font: 10pt Times New Roman, Times, Serif"><u>Costs
of Revenue</u> – Cost of revenue includes raw materials, component parts, and shipping supplies. Shipping and handling costs
is not a significant portion of the cost of revenue.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Accounts
Receivable</u> – Accounts receivable is comprised of uncollateralized customer obligations due under normal trade terms requiring
payment within 30 days from the invoice date. The carrying amount of accounts receivable is reviewed periodically for collectability.
If management determines that collection is unlikely, an allowance that reflects management’s best estimate of the amounts
that will not be collected is recorded. Management reviews each accounts receivable balance that exceeds 30 days from the invoice
date and, based on an assessment of creditworthiness, estimates the portion, if any, of the balance that will not be collected.
As of June 30, 2013, the Company had not recorded a reserve for doubtful accounts.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Inventory
</u>– Substantially all inventory consists of finished goods and are valued based upon first-in first-out ("FIFO") cost,
not in excess of market. The determination of whether the carrying amount of inventory requires a write-down is based on an evaluation
of inventory.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Goodwill
and intangible assets</u> – The Company follows Financial Accounting Standard Board’s (FASB) Codification Topic 350-10
(“ASC 350-10”), “<i>Intangibles – Goodwill and Other</i>”. According to this statement, goodwill and
intangible assets with indefinite lives are no longer subject to amortization, but rather an annual assessment of impairment by
applying a fair-value based test. Fair value for goodwill is based on discounted cash flows, market multiples and/or appraised
values as appropriate. Under ASC 350-10, the carrying value of assets are calculated at the lowest level for which there are identifiable
cash flows.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Income
taxes </u>– The Company accounts for its income taxes in accordance with FASB Codification Topic ASC 740-10, “<i>Income
Taxes</i>”, which requires recognition of deferred tax assets and liabilities for future tax consequences attributable to
differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases
and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable
income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets
and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Stock-based
compensation</u> – The Company follows the guidelines in FASB Codification Topic ASC 718-10 “<i>Compensation-Stock Compensation</i>”,
which requires the measurement and recognition of compensation expense for all share-based payment awards made to employees and
directors including employee stock options and employee stock purchases related to a Employee Stock Purchase Plan based on the
estimated fair values.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Stock
based compensation expense recognized under ASC 718-10 for the six months ended June 30, 2013 and 2012 totaled $12,800 and $0
respectively.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Earnings
(loss) per share</u> – The Company reports earnings (loss) per share in accordance with FASB Codification Topic ASC 260-10
“<i>Earnings Per Share</i>”, Basic earnings (loss) per share is computed by dividing income (loss) available to common
shareholders by the weighted average number of common shares available. Diluted earnings (loss) per share is computed similar
to basic earnings (loss) per share except that the denominator is increased to include the number of additional common shares
that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive.
Diluted earnings (loss) per share has not been presented since the effect of the assumed exercise of options and warrants to purchase
common shares (common stock equivalents) would have an anti-dilutive effect.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Restatement
</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">Upon completing
the Company’s September 30, 2012 financial statements, an accounting error was discovered that misstated certain balance
sheet amounts previously reported as of June 30, 2012. The following is a summary of the impact of these restatements on the Company’s
Consolidated Balance Sheet at June 30, 2012: </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<table cellspacing="0" cellpadding="0" align="center" style="width: 70%; border-collapse: collapse; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 1pt; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="11" style="border-bottom: black 1pt solid; text-align: center; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">June
30, 2012</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">As previously</font></td>
<td style="font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">Error</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 1pt; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">reported</font></td>
<td style="padding-bottom: 1pt; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">correction</font></td>
<td style="text-align: center; padding-bottom: 1pt; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">As
restated</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; width: 53%"><font style="font: 10pt Times New Roman, Times, Serif">Accounts
payable and accrued liabilities</font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 12%"><font style="font: 10pt Times New Roman, Times, Serif">701,466</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 12%"><font style="font: 10pt Times New Roman, Times, Serif">22,450</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center; width: 3%"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 12%"><font style="font: 10pt Times New Roman, Times, Serif">723,916</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt"><font style="font: 10pt Times New Roman, Times, Serif">Accrued interest payable</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">5,551</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">15,861</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">21,412</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt"><font style="font: 10pt Times New Roman, Times, Serif">Loans from related
party</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">19,984</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(9,719</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">10,265</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt"><font style="font: 10pt Times New Roman, Times, Serif">Convertible notes
payable, net of unamortized discount</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">150,167</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">207</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">154,349</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">3,975</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt"><font style="font: 10pt Times New Roman, Times, Serif">Convertible notes
payable related party, net of unamortized discount</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">745,517</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(402,155</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">343,362</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif">Total current liabilities</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,845,138</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(398,180</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,475,757</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">28,799</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif">Additional paid-in
capital</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">20,169,778</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">447,021</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">20,616,799</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif">Accumulated deficit</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(21,765,859</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(48,841</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(21,843,499</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(28,799</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif">Total stockholders’
deficit</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(1,487,059</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">398,180</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(1,117,678</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(28,799</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr>
<td colspan="13" style="text-align: left; padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif">(a)
To correct errors in debt discount of convertible notes payable.</font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td colspan="13" style="text-align: left; padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif">(b)
To correct errors due to incorrect allocation of convertible debt.</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The following
is a summary of the impact of these restatements on the Company’s Consolidated Income Statement for the quarter ended June
30, 2012: </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<table cellspacing="0" cellpadding="0" align="center" style="width: 70%; border-collapse: collapse; font-size: 10pt">
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 1pt; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="11" style="border-bottom: black 1pt solid; text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">June
30, 2012</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">As
previously</font></td>
<td style="font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">Error</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 1pt; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">reported</font></td>
<td style="padding-bottom: 1pt; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">correction</font></td>
<td style="padding-bottom: 1pt; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">As
restated</font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; width: 53%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Selling,
general and administrative</font></td>
<td style="width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 12%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">306,016</font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 12%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">26,409</font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 3%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 12%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">363,968</font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">31,543</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Total
operating expenses</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">323,911</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">26,409</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">381,863</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">31,543</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Loss
from operations</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(294,429</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(26,409</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(352,381</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(31,543</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Loss
on conversion of debt</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(3,580</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">3,580</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—
</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Gain
on extinguishment of debt</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">836</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(836</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—
</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Net
loss</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(332,445</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(26,409</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(387,653</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(28,799</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Basic
loss per common share</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(0.00</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(0.00</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(0.00</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td colspan="13" style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(a)
To correct errors in debt discount of convertible notes payable.</font></td></tr>
<tr style="vertical-align: bottom">
<td colspan="13" style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(b)
To correct errors due to incorrect allocation of convertible debt.</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The following
is a summary of the impact of these restatements on the Company’s Consolidated Income Statement for the six months ended
June 30, 2012: </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<table cellspacing="0" cellpadding="0" align="center" style="width: 70%; border-collapse: collapse; font-size: 10pt">
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 1pt; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="11" style="border-bottom: black 1pt solid; text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">June
30, 2012</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">As
previously</font></td>
<td style="font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">Error</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 1pt; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">reported</font></td>
<td style="padding-bottom: 1pt; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">correction</font></td>
<td style="text-align: center; padding-bottom: 1pt; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">As
restated</font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; width: 53%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Selling,
general and administrative</font></td>
<td style="width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 12%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">598,949</font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 2%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 12%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">48,841</font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center; width: 2%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 12%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">679,333</font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">31,543</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Total
operating expenses</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">634,563</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">48,841</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">714,947</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">31,543</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Loss
from operations</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(575,879</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(48,841</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(656,263</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(31,543</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Loss
on conversion of debt</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(3,580</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">3,580</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Gain
on extinguishment of debt</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">2,563</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(836</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">1,727</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Net
loss</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(646,916</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(48,841</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(724,556</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(28,799</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 11pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Basic
loss per common share</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(0.00</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(0.00</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(0.00</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td colspan="13" style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(a)
To correct errors in debt discount of convertible notes payable.</font></td></tr>
<tr style="vertical-align: bottom">
<td colspan="13" style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(b)
To correct errors due to incorrect allocation of convertible debt.</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The following
is a summary of the impact of these restatements on the Company’s Consolidated Statement of Cash Flows for the six months
ended June 30, 2012: </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<table cellspacing="0" cellpadding="0" align="center" style="width: 70%; border-collapse: collapse; font-size: 10pt">
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 1pt; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="11" style="border-bottom: black 1pt solid; text-align: center; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">June
30, 2012</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">As previously</font></td>
<td style="font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">Error</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 1pt; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">reported</font></td>
<td style="padding-bottom: 1pt; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">correction</font></td>
<td style="text-align: center; padding-bottom: 1pt; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">As
restated</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; width: 53%"><font style="font: 10pt Times New Roman, Times, Serif">Net loss</font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 12%"><font style="font: 10pt Times New Roman, Times, Serif">(646,916</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 12%"><font style="font: 10pt Times New Roman, Times, Serif">(48,841</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center; width: 3%"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 12%"><font style="font: 10pt Times New Roman, Times, Serif">(724,556</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(28,799</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt"><font style="font: 10pt Times New Roman, Times, Serif">Amortization of debt
discount</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">218,603</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">48,841</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">267,444</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt"><font style="font: 10pt Times New Roman, Times, Serif">Debt paid with common
stock</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">82,984</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(6,975</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">76,009</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt"><font style="font: 10pt Times New Roman, Times, Serif">Accrued expenses converted
to notes</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">217,445</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">207</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">217,652</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt"><font style="font: 10pt Times New Roman, Times, Serif">Loss on extinguishment
of debt</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">3,580</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(3,580</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt"><font style="font: 10pt Times New Roman, Times, Serif">Gain on extinguishment
of debt</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(2,563</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">836</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(1,727</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt"><font style="font: 10pt Times New Roman, Times, Serif">Increase in accounts
payable and accrued liabilities</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">77,494</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">22,450</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">99,944</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt"><font style="font: 10pt Times New Roman, Times, Serif">Increase in accrued
interest</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">5,551</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">15,861</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">21,412</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom">
<td colspan="13" style="text-align: left; padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif">(a)
To correct errors in debt discount of convertible notes payable.</font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td colspan="13" style="text-align: left; padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif">(b)
To correct errors due to incorrect allocation of convertible debt.</font></td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Description
of business</u> – Skinvisible, Inc., (referred to as the “Company”) is focused on the development and manufacture
of innovative topical, transdermal and mucosal polymer-based delivery system technologies and formulations incorporating its patent-pending
formula/process for combining hydrophilic and hydrophobic polymer emulsions. The technologies and formulations have broad industry
applications within the pharmaceutical, over-the-counter, personal skincare and cosmetic arenas. Additionally, the Company’s
non-dermatological formulations, offer solutions for a broad spectrum of markets women’s health, pain management, and others.
The Company maintains executive and sales offices in Las Vegas, Nevada.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>History
</u>– Skinvisible, Inc. (referred to as the “Company”) was incorporated in Nevada on March 6, 1998 under the name
of Microbial Solutions, Inc. The Company underwent a name change on February 26, 1999, when it changed its name to Skinvisible,
Inc. The Company’s subsidiary’s name of Manloe Labs, Inc. was also changed to Skinvisible Pharmaceuticals, Inc.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Skinvisible,
Inc. together with its subsidiary shall herein be collectively referred to as the “Company”.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Going
concern </u>– The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization
of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred cumulative net losses
of $23,261,020 since its inception and requires capital for its contemplated operational and marketing activities to take place.
The Company’s ability to raise additional capital through the future issuances of common stock is unknown. The obtainment
of additional financing, the successful development of the Company’s contemplated plan of operations, and its transition,
ultimately, to the attainment of profitable operations are necessary for the Company to continue operations. The ability to successfully
resolve these factors raises substantial doubt about the Company’s ability to continue as a going concern. The consolidated
financial statements of the Company do not include any adjustments that may result from the outcome of these aforementioned uncertainties.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Principles
of consolidation</u> – The consolidated financial statements include the accounts of the Company and its subsidiary. All
significant intercompany balances and transactions have been eliminated.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Use
of estimates </u>– The preparation of consolidated financial statements in conformity with accounting principles generally
accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the
reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Cash
and cash equivalents</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">For
purposes of the statement of cash flows, the Company considers all highly liquid investments and short-term debt instruments with
original maturities of three months or less to be cash equivalents.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Fair
Value of Financial Instruments</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The
carrying amounts reflected in the balance sheets for cash, accounts payable and accrued expenses approximate the respective fair
values due to the short maturities of these items.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">As
required by the Fair Value Measurements and Disclosures Topic of the FASB ASC, fair value is measured based on a three-tier fair
value hierarchy, which prioritizes the inputs used in measuring fair value as follows: (Level 1) observable inputs such as quoted
prices in active markets; (Level 2) inputs, other than the quoted prices in active markets, that are observable either directly
or indirectly; and (Level 3) unobservable inputs in which there is little or no market data, which require the reporting entity
to develop its own assumptions.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The
three levels of the fair value hierarchy are described below:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Level
1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or
liabilities;</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Level
2: Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially
the full term of the asset or liability;</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Level
3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable
(supported by little or no market activity).</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Revenue
recognition</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Product
sales</u> – Revenues from the sale of products (Invisicare® polymers) are recognized when title to the products are
transferred to the customer and only when no further contingencies or material performance obligations are warranted, and thereby
have earned the right to receive reasonably assured payments for products sold and delivered.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Royalty
sales</u> – The Company also recognizes royalty revenue from licensing its patented product formulations only when earned,
when no further contingencies or material performance obligations are warranted, and thereby have earned the right to receive
and retain reasonably assured payments.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; text-align: justify; margin-right: 0; margin-left: 0.5in"><font style="font: 10pt Times New Roman, Times, Serif"><u>Distribution
and license rights sales</u> – The Company also recognizes revenue from distribution and license rights only when earned
(and are amortized over a five year period), when no further contingencies or material performance obligations are warranted,
and thereby have earned the right to receive and retain reasonably assured payments.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; text-align: justify; margin-right: 0; margin-left: 0.5in"><font style="font: 10pt Times New Roman, Times, Serif"><u>Costs
of Revenue</u> – Cost of revenue includes raw materials, component parts, and shipping supplies. Shipping and handling costs
is not a significant portion of the cost of revenue.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Accounts
Receivable</u> – Accounts receivable is comprised of uncollateralized customer obligations due under normal trade terms requiring
payment within 30 days from the invoice date. The carrying amount of accounts receivable is reviewed periodically for collectability.
If management determines that collection is unlikely, an allowance that reflects management’s best estimate of the amounts
that will not be collected is recorded. Management reviews each accounts receivable balance that exceeds 30 days from the invoice
date and, based on an assessment of creditworthiness, estimates the portion, if any, of the balance that will not be collected.
As of June 30, 2013, the Company had not recorded a reserve for doubtful accounts.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Inventory
</u>– Substantially all inventory consists of finished goods and are valued based upon first-in first-out ("FIFO") cost,
not in excess of market. The determination of whether the carrying amount of inventory requires a write-down is based on an evaluation
of inventory.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Goodwill
and intangible assets</u> – The Company follows Financial Accounting Standard Board’s (FASB) Codification Topic 350-10
(“ASC 350-10”), “<i>Intangibles – Goodwill and Other</i>”. According to this statement, goodwill and
intangible assets with indefinite lives are no longer subject to amortization, but rather an annual assessment of impairment by
applying a fair-value based test. Fair value for goodwill is based on discounted cash flows, market multiples and/or appraised
values as appropriate. Under ASC 350-10, the carrying value of assets are calculated at the lowest level for which there are identifiable
cash flows.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Income
taxes </u>– The Company accounts for its income taxes in accordance with FASB Codification Topic ASC 740-10, “<i>Income
Taxes</i>”, which requires recognition of deferred tax assets and liabilities for future tax consequences attributable to
differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases
and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable
income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets
and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Stock-based
compensation</u> – The Company follows the guidelines in FASB Codification Topic ASC 718-10 “<i>Compensation-Stock Compensation</i>”,
which requires the measurement and recognition of compensation expense for all share-based payment awards made to employees and
directors including employee stock options and employee stock purchases related to a Employee Stock Purchase Plan based on the
estimated fair values.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Stock
based compensation expense recognized under ASC 718-10 for the six months ended June 30, 2013 and 2012 totaled $12,800 and $0
respectively.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Earnings
(loss) per share</u> – The Company reports earnings (loss) per share in accordance with FASB Codification Topic ASC 260-10
“<i>Earnings Per Share</i>”, Basic earnings (loss) per share is computed by dividing income (loss) available to common
shareholders by the weighted average number of common shares available. Diluted earnings (loss) per share is computed similar
to basic earnings (loss) per share except that the denominator is increased to include the number of additional common shares
that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive.
Diluted earnings (loss) per share has not been presented since the effect of the assumed exercise of options and warrants to purchase
common shares (common stock equivalents) would have an anti-dilutive effect.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Restatement
</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">Upon completing
the Company’s September 30, 2012 financial statements, an accounting error was discovered that misstated certain balance
sheet amounts previously reported as of June 30, 2012. The following is a summary of the impact of these restatements on the Company’s
Consolidated Balance Sheet at June 30, 2012: </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<table cellspacing="0" cellpadding="0" align="center" style="width: 70%; border-collapse: collapse; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 1pt; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="11" style="border-bottom: black 1pt solid; text-align: center; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">June
30, 2012</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">As previously</font></td>
<td style="font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">Error</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 1pt; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">reported</font></td>
<td style="padding-bottom: 1pt; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">correction</font></td>
<td style="text-align: center; padding-bottom: 1pt; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">As
restated</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; width: 53%"><font style="font: 10pt Times New Roman, Times, Serif">Accounts
payable and accrued liabilities</font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 12%"><font style="font: 10pt Times New Roman, Times, Serif">701,466</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 12%"><font style="font: 10pt Times New Roman, Times, Serif">22,450</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center; width: 3%"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 12%"><font style="font: 10pt Times New Roman, Times, Serif">723,916</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt"><font style="font: 10pt Times New Roman, Times, Serif">Accrued interest payable</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">5,551</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">15,861</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">21,412</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt"><font style="font: 10pt Times New Roman, Times, Serif">Loans from related
party</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">19,984</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(9,719</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">10,265</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt"><font style="font: 10pt Times New Roman, Times, Serif">Convertible notes
payable, net of unamortized discount</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">150,167</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">207</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">154,349</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">3,975</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt"><font style="font: 10pt Times New Roman, Times, Serif">Convertible notes
payable related party, net of unamortized discount</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">745,517</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(402,155</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">343,362</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif">Total current liabilities</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,845,138</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(398,180</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,475,757</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">28,799</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif">Additional paid-in
capital</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">20,169,778</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">447,021</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">20,616,799</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif">Accumulated deficit</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(21,765,859</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(48,841</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(21,843,499</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(28,799</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif">Total stockholders’
deficit</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(1,487,059</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">398,180</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(1,117,678</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(28,799</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr>
<td colspan="13" style="text-align: left; padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif">(a)
To correct errors in debt discount of convertible notes payable.</font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td colspan="13" style="text-align: left; padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif">(b)
To correct errors due to incorrect allocation of convertible debt.</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The following
is a summary of the impact of these restatements on the Company’s Consolidated Income Statement for the quarter ended June
30, 2012: </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<table cellspacing="0" cellpadding="0" align="center" style="width: 70%; border-collapse: collapse; font-size: 10pt">
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 1pt; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="11" style="border-bottom: black 1pt solid; text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">June
30, 2012</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">As
previously</font></td>
<td style="font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">Error</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 1pt; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">reported</font></td>
<td style="padding-bottom: 1pt; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">correction</font></td>
<td style="padding-bottom: 1pt; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">As
restated</font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; width: 53%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Selling,
general and administrative</font></td>
<td style="width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 12%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">306,016</font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 12%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">26,409</font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 3%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 12%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">363,968</font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">31,543</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Total
operating expenses</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">323,911</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">26,409</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">381,863</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">31,543</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Loss
from operations</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(294,429</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(26,409</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(352,381</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(31,543</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Loss
on conversion of debt</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(3,580</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">3,580</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—
</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Gain
on extinguishment of debt</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">836</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(836</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—
</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Net
loss</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(332,445</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(26,409</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(387,653</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(28,799</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Basic
loss per common share</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(0.00</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(0.00</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(0.00</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td colspan="13" style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(a)
To correct errors in debt discount of convertible notes payable.</font></td></tr>
<tr style="vertical-align: bottom">
<td colspan="13" style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(b)
To correct errors due to incorrect allocation of convertible debt.</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The following
is a summary of the impact of these restatements on the Company’s Consolidated Income Statement for the six months ended
June 30, 2012: </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<table cellspacing="0" cellpadding="0" align="center" style="width: 70%; border-collapse: collapse; font-size: 10pt">
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 1pt; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="11" style="border-bottom: black 1pt solid; text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">June
30, 2012</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">As
previously</font></td>
<td style="font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">Error</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 1pt; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">reported</font></td>
<td style="padding-bottom: 1pt; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">correction</font></td>
<td style="text-align: center; padding-bottom: 1pt; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">As
restated</font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; width: 53%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Selling,
general and administrative</font></td>
<td style="width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 12%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">598,949</font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 2%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 12%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">48,841</font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center; width: 2%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 12%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">679,333</font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">31,543</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Total
operating expenses</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">634,563</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">48,841</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">714,947</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">31,543</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Loss
from operations</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(575,879</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(48,841</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(656,263</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(31,543</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Loss
on conversion of debt</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(3,580</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">3,580</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Gain
on extinguishment of debt</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">2,563</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(836</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">1,727</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Net
loss</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(646,916</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(48,841</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(724,556</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(28,799</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 11pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Basic
loss per common share</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(0.00</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(0.00</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(0.00</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td colspan="13" style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(a)
To correct errors in debt discount of convertible notes payable.</font></td></tr>
<tr style="vertical-align: bottom">
<td colspan="13" style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(b)
To correct errors due to incorrect allocation of convertible debt.</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">The following
is a summary of the impact of these restatements on the Company’s Consolidated Statement of Cash Flows for the six months
ended June 30, 2012: </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<table cellspacing="0" cellpadding="0" align="center" style="width: 70%; border-collapse: collapse; font-size: 10pt">
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 1pt; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="11" style="border-bottom: black 1pt solid; text-align: center; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">June
30, 2012</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">As previously</font></td>
<td style="font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">Error</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 1pt; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">reported</font></td>
<td style="padding-bottom: 1pt; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">correction</font></td>
<td style="text-align: center; padding-bottom: 1pt; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-weight: bold"><font style="font: 10pt Times New Roman, Times, Serif">As
restated</font></td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; width: 53%"><font style="font: 10pt Times New Roman, Times, Serif">Net loss</font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 12%"><font style="font: 10pt Times New Roman, Times, Serif">(646,916</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 12%"><font style="font: 10pt Times New Roman, Times, Serif">(48,841</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center; width: 3%"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 12%"><font style="font: 10pt Times New Roman, Times, Serif">(724,556</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(28,799</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt"><font style="font: 10pt Times New Roman, Times, Serif">Amortization of debt
discount</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">218,603</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">48,841</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(a)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">267,444</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt"><font style="font: 10pt Times New Roman, Times, Serif">Debt paid with common
stock</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">82,984</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(6,975</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">76,009</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt"><font style="font: 10pt Times New Roman, Times, Serif">Accrued expenses converted
to notes</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">217,445</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">207</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">217,652</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt"><font style="font: 10pt Times New Roman, Times, Serif">Loss on extinguishment
of debt</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">3,580</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(3,580</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt"><font style="font: 10pt Times New Roman, Times, Serif">Gain on extinguishment
of debt</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(2,563</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">836</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(1,727</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt"><font style="font: 10pt Times New Roman, Times, Serif">Increase in accounts
payable and accrued liabilities</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">77,494</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">22,450</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">99,944</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt"><font style="font: 10pt Times New Roman, Times, Serif">Increase in accrued
interest</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">5,551</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">15,861</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">(b)</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">21,412</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom">
<td colspan="13" style="text-align: left; padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif">(a)
To correct errors in debt discount of convertible notes payable.</font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td colspan="13" style="text-align: left; padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif">(b)
To correct errors due to incorrect allocation of convertible debt.</font></td></tr>
</table>
<table cellspacing="0" cellpadding="0" align="center" style="width: 70%; border-collapse: collapse; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1pt; font-weight: bold"> </td>
<td colspan="11" style="border-bottom: black 1pt solid; text-align: center; font-weight: bold">June 30, 2012</td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td style="font-weight: bold"> </td>
<td colspan="3" style="text-align: center; font-weight: bold">As previously</td>
<td style="font-weight: bold"> </td>
<td colspan="3" style="text-align: center; font-weight: bold">Error</td>
<td style="text-align: center"> </td>
<td colspan="3"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1pt; font-weight: bold"> </td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-weight: bold">reported</td>
<td style="padding-bottom: 1pt; font-weight: bold"> </td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-weight: bold">correction</td>
<td style="text-align: center; padding-bottom: 1pt; font-weight: bold"> </td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-weight: bold">As restated</td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="3"> </td>
<td> </td>
<td colspan="3"> </td>
<td style="text-align: center"> </td>
<td colspan="3"> </td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; width: 53%">Accounts payable and accrued liabilities</td>
<td style="width: 1%"> </td>
<td style="text-align: left; width: 1%">$</td>
<td style="text-align: right; width: 12%">701,466</td>
<td style="text-align: left; width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="text-align: left; width: 1%">$</td>
<td style="text-align: right; width: 12%">22,450</td>
<td style="text-align: left; width: 1%"> </td>
<td style="text-align: center; width: 3%">(b)</td>
<td style="text-align: left; width: 1%">$</td>
<td style="text-align: right; width: 12%">723,916</td>
<td style="text-align: left; width: 1%"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt">Accrued interest payable</td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">5,551</td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">15,861</td>
<td style="text-align: left"> </td>
<td style="text-align: center">(b)</td>
<td style="text-align: left">$</td>
<td style="text-align: right">21,412</td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt">Loans from related party</td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">19,984</td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">(9,719</td>
<td style="text-align: left">)</td>
<td style="text-align: center">(b)</td>
<td style="text-align: left">$</td>
<td style="text-align: right">10,265</td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt">Convertible notes payable, net of unamortized discount</td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">150,167</td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">207</td>
<td style="text-align: left"> </td>
<td style="text-align: center">(b)</td>
<td style="text-align: left">$</td>
<td style="text-align: right">154,349</td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">3,975</td>
<td style="text-align: left"> </td>
<td style="text-align: center">(a)</td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt">Convertible notes payable related party, net of unamortized discount</td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">745,517</td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">(402,155</td>
<td style="text-align: left">)</td>
<td style="text-align: center">(a)</td>
<td style="text-align: left">$</td>
<td style="text-align: right">343,362</td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: center"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt">Total current liabilities</td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">1,845,138</td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">(398,180</td>
<td style="text-align: left">)</td>
<td style="text-align: center">(a)</td>
<td style="text-align: left">$</td>
<td style="text-align: right">1,475,757</td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<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">$</td>
<td style="text-align: right">28,799</td>
<td style="text-align: left"> </td>
<td style="text-align: center">(b)</td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: center"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt">Additional paid-in capital</td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">20,169,778</td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">447,021</td>
<td style="text-align: left"> </td>
<td style="text-align: center">(a)</td>
<td style="text-align: left">$</td>
<td style="text-align: right">20,616,799</td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt">Accumulated deficit</td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">(21,765,859</td>
<td style="text-align: left">)</td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">(48,841</td>
<td style="text-align: left">)</td>
<td style="text-align: center">(a)</td>
<td style="text-align: left">$</td>
<td style="text-align: right">(21,843,499</td>
<td style="text-align: left">)</td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">(28,799</td>
<td style="text-align: left">)</td>
<td style="text-align: center">(b)</td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<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 style="text-align: center"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt">Total stockholders’ deficit</td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">(1,487,059</td>
<td style="text-align: left">)</td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">398,180</td>
<td style="text-align: left"> </td>
<td style="text-align: center">(a)</td>
<td style="text-align: left">$</td>
<td style="text-align: right">(1,117,678</td>
<td style="text-align: left">)</td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">(28,799</td>
<td style="text-align: left">)</td>
<td style="text-align: center">(b)</td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
<tr>
<td colspan="13" style="text-align: left; padding-left: 5.4pt">(a) To correct errors in debt discount of convertible notes payable.</td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td colspan="13" style="text-align: left; padding-left: 5.4pt">(b) To correct errors due to incorrect allocation of convertible debt.</td></tr>
</table>
<table cellspacing="0" cellpadding="0" align="center" style="width: 70%; border-collapse: collapse; font-size: 10pt">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1pt; font-family: Times New Roman, Times, Serif; font-weight: bold"> </td>
<td colspan="11" style="border-bottom: black 1pt solid; text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font-size: 10pt">June 30, 2012</font></td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td style="font-family: Times New Roman, Times, Serif; font-weight: bold"> </td>
<td colspan="3" style="text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font-size: 10pt">As previously</font></td>
<td style="font-family: Times New Roman, Times, Serif; font-weight: bold"> </td>
<td colspan="3" style="text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font-size: 10pt">Error</font></td>
<td> </td>
<td colspan="3"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1pt; font-family: Times New Roman, Times, Serif; font-weight: bold"> </td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font-size: 10pt">reported</font></td>
<td style="padding-bottom: 1pt; font-family: Times New Roman, Times, Serif; font-weight: bold"> </td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font-size: 10pt">correction</font></td>
<td style="padding-bottom: 1pt; font-family: Times New Roman, Times, Serif; font-weight: bold"> </td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold"><font style="font-size: 10pt">As restated</font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; width: 53%; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">Selling, general and administrative</font></td>
<td style="width: 1%; font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">$</font></td>
<td style="text-align: right; width: 12%; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">306,016</font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"> </td>
<td style="width: 1%; font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">$</font></td>
<td style="text-align: right; width: 12%; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">26,409</font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"> </td>
<td style="width: 3%; font-family: Times New Roman, Times, Serif">(a)</td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">$</font></td>
<td style="text-align: right; width: 12%; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">363,968</font></td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">31,543</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"> </td>
<td><font style="font-size: 10pt">(b)</font></td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<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></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">Total operating expenses</font></td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">323,911</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"> </td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">26,409</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"> </td>
<td style="font-family: Times New Roman, Times, Serif">(a)</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">381,863</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"> </td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">31,543</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"> </td>
<td>(b)</td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<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></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">Loss from operations</font></td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">(294,429</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">(26,409</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">(a)</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">(352,381</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">)</font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">(31,543</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">)</font></td>
<td><font style="font-size: 10pt">(b)</font></td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<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></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">Loss on conversion of debt</font></td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">(3,580</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">3,580</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"> </td>
<td style="font-family: Times New Roman, Times, Serif">(b)</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">— </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"> </td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">Gain on extinguishment of debt</font></td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">836</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"> </td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">(836</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">)</font></td>
<td style="font-family: Times New Roman, Times, Serif">(b)</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">— </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<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></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">Net loss</font></td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">(332,445</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">(26,409</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">)</font></td>
<td style="font-family: Times New Roman, Times, Serif">(a)</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">(387,653</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">)</font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">(28,799</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">)</font></td>
<td>(b)</td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<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></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">Basic loss per common share</font></td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">(0.00</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">(0.00</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">)</font></td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">$</font></td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">(0.00</font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">)</font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<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></tr>
<tr style="background-color: white; vertical-align: bottom">
<td colspan="13" style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">(a) To correct errors in debt discount of convertible notes payable.</font></td></tr>
<tr style="vertical-align: bottom">
<td colspan="13" style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt">(b) To correct errors due to incorrect allocation of convertible debt.</font></td></tr>
</table>
<table cellspacing="0" cellpadding="0" align="center" style="width: 70%; border-collapse: collapse; font-size: 10pt">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1pt; font-family: Times New Roman, Times, Serif; font-weight: bold"> </td>
<td colspan="11" style="border-bottom: black 1pt solid; text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold">June 30, 2012</td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td style="font-family: Times New Roman, Times, Serif; font-weight: bold"> </td>
<td colspan="3" style="text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold">As previously</td>
<td style="font-family: Times New Roman, Times, Serif; font-weight: bold"> </td>
<td colspan="3" style="text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold">Error</td>
<td style="text-align: center"> </td>
<td colspan="3"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1pt; font-family: Times New Roman, Times, Serif; font-weight: bold"> </td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold">reported</td>
<td style="padding-bottom: 1pt; font-family: Times New Roman, Times, Serif; font-weight: bold"> </td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold">correction</td>
<td style="text-align: center; padding-bottom: 1pt; font-family: Times New Roman, Times, Serif; font-weight: bold"> </td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-family: Times New Roman, Times, Serif; font-weight: bold">As restated</td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; width: 53%; font-family: Times New Roman, Times, Serif">Selling, general and administrative</td>
<td style="width: 1%; font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif">$</td>
<td style="text-align: right; width: 12%; font-family: Times New Roman, Times, Serif">598,949</td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"> </td>
<td style="width: 2%; font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif">$</td>
<td style="text-align: right; width: 12%; font-family: Times New Roman, Times, Serif">48,841</td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: center; width: 2%; font-family: Times New Roman, Times, Serif">(a)</td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif">$</td>
<td style="text-align: right; width: 12%; font-family: Times New Roman, Times, Serif">679,333</td>
<td style="text-align: left; width: 1%; font-family: Times New Roman, Times, Serif"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<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 style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif">31,543</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: center">(b)</td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: center"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif">Total operating expenses</td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif">634,563</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"> </td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif">48,841</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: center; font-family: Times New Roman, Times, Serif">(a)</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif">714,947</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"> </td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<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 style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif">31,543</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: center">(b)</td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: center"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt; font-family: Times New Roman, Times, Serif">Loss from operations</td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif">(575,879</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">)</td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif">(48,841</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">)</td>
<td style="text-align: center; font-family: Times New Roman, Times, Serif">(a)</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif">(656,263</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">)</td></tr>
<tr style="background-color: white; vertical-align: bottom">
<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 style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif">(31,543</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">)</td>
<td style="text-align: center">(b)</td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: center"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif">Loss on conversion of debt</td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif">(3,580</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">)</td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif">3,580</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: center; font-family: Times New Roman, Times, Serif">(b)</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif">—</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"> </td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif">Gain on extinguishment of debt</td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif">2,563</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"> </td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif">(836</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">)</td>
<td style="text-align: center; font-family: Times New Roman, Times, Serif">(b)</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif">1,727</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: center"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif">Net loss</td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif">(646,916</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">)</td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif">(48,841</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">)</td>
<td style="text-align: center; font-family: Times New Roman, Times, Serif">(a)</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif">(724,556</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">)</td></tr>
<tr style="background-color: white; vertical-align: bottom">
<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 style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif">(28,799</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">)</td>
<td style="text-align: center">(b)</td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="padding-left: 5.4pt"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td style="text-align: center"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 11pt; font-family: Times New Roman, Times, Serif">Basic loss per common share</td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif">(0.00</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">)</td>
<td style="font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif">(0.00</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">)</td>
<td style="text-align: center; font-family: Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font-family: Times New Roman, Times, Serif">(0.00</td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif">)</td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<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 style="text-align: center"> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td colspan="13" style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif">(a) To correct errors in debt discount of convertible notes payable.</td></tr>
<tr style="vertical-align: bottom">
<td colspan="13" style="text-align: left; padding-left: 5.4pt; font-family: Times New Roman, Times, Serif">(b) To correct errors due to incorrect allocation of convertible debt.</td></tr>
</table>
<table cellspacing="0" cellpadding="0" align="center" style="width: 70%; border-collapse: collapse; font-size: 10pt">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1pt; font-weight: bold"> </td>
<td colspan="11" style="border-bottom: black 1pt solid; text-align: center; font-weight: bold">June 30, 2012</td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td style="font-weight: bold"> </td>
<td colspan="3" style="text-align: center; font-weight: bold">As previously</td>
<td style="font-weight: bold"> </td>
<td colspan="3" style="text-align: center; font-weight: bold">Error</td>
<td style="text-align: center"> </td>
<td colspan="3"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1pt; font-weight: bold"> </td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-weight: bold">reported</td>
<td style="padding-bottom: 1pt; font-weight: bold"> </td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-weight: bold">correction</td>
<td style="text-align: center; padding-bottom: 1pt; font-weight: bold"> </td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center; font-weight: bold">As restated</td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="3"> </td>
<td> </td>
<td colspan="3"> </td>
<td style="text-align: center"> </td>
<td colspan="3"> </td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 5.4pt; width: 53%">Net loss</td>
<td style="width: 1%"> </td>
<td style="text-align: left; width: 1%">$</td>
<td style="text-align: right; width: 12%">(646,916</td>
<td style="text-align: left; width: 1%">)</td>
<td style="width: 1%"> </td>
<td style="text-align: left; width: 1%">$</td>
<td style="text-align: right; width: 12%">(48,841</td>
<td style="text-align: left; width: 1%">)</td>
<td style="text-align: center; width: 3%">(a)</td>
<td style="text-align: left; width: 1%">$</td>
<td style="text-align: right; width: 12%">(724,556</td>
<td style="text-align: left; width: 1%">)</td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">(28,799</td>
<td style="text-align: left">)</td>
<td style="text-align: center">(b)</td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt">Amortization of debt discount</td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">218,603</td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">48,841</td>
<td style="text-align: left"> </td>
<td style="text-align: center">(a)</td>
<td style="text-align: left">$</td>
<td style="text-align: right">267,444</td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt">Debt paid with common stock</td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">82,984</td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">(6,975</td>
<td style="text-align: left">)</td>
<td style="text-align: center">(b)</td>
<td style="text-align: left">$</td>
<td style="text-align: right">76,009</td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt">Accrued expenses converted to notes</td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">217,445</td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">207</td>
<td style="text-align: left"> </td>
<td style="text-align: center">(b)</td>
<td style="text-align: left">$</td>
<td style="text-align: right">217,652</td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt">Loss on extinguishment of debt</td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">3,580</td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">(3,580</td>
<td style="text-align: left">)</td>
<td style="text-align: center">(b)</td>
<td style="text-align: left">$</td>
<td style="text-align: right">—</td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt">Gain on extinguishment of debt</td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">(2,563</td>
<td style="text-align: left">)</td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">836</td>
<td style="text-align: left"> </td>
<td style="text-align: center">(b)</td>
<td style="text-align: left">$</td>
<td style="text-align: right">(1,727</td>
<td style="text-align: left">)</td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt">Increase in accounts payable and accrued liabilities</td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">77,494</td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">22,450</td>
<td style="text-align: left"> </td>
<td style="text-align: center">(b)</td>
<td style="text-align: left">$</td>
<td style="text-align: right">99,944</td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: left; padding-left: 11pt">Increase in accrued interest</td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">5,551</td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left">$</td>
<td style="text-align: right">15,861</td>
<td style="text-align: left"> </td>
<td style="text-align: center">(b)</td>
<td style="text-align: left">$</td>
<td style="text-align: right">21,412</td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<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 style="text-align: center"> </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">
<td colspan="13" style="text-align: left; padding-left: 5.4pt">(a) To correct errors in debt discount of convertible notes payable.</td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td colspan="13" style="text-align: left; padding-left: 5.4pt">(b) To correct errors due to incorrect allocation of convertible debt.</td></tr>
</table>
1998-03-06
-3580
-3580
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Fixed assets consist of the following as of
June 30, 2013 and December 31, 2012:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p>
<table cellspacing="0" cellpadding="0" align="center" style="width: 50%; border-collapse: collapse; font-size: 10pt">
<tr style="vertical-align: bottom">
<td style="text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">June
30, 2013</font></td>
<td style="padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">December
31, 2012</font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; width: 55%"><font style="font: 10pt Times New Roman, Times, Serif">Machinery and equipment</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 20%"><font style="font: 10pt Times New Roman, Times, Serif">48,163</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 20%"><font style="font: 10pt Times New Roman, Times, Serif">45,208</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Furniture and fixtures</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">113,635</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">113,635</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Computers, equipment and software</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">38,540</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">38,105</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Leasehold improvements</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">12,569</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">12,569</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif">Lab equipment</font></td>
<td style="border-bottom: black 1pt solid; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">113,461</font></td>
<td style="text-align: left; padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">113,461</font></td>
<td style="text-align: left; padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Total</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">326,368</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">322,978</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif">Less: accumulated
depreciation</font></td>
<td style="border-bottom: black 1pt solid; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(322,141</font></td>
<td style="text-align: left; padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(318,519</font></td>
<td style="text-align: left; padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify; padding-bottom: 2.5pt"><font style="font: 10pt Times New Roman, Times, Serif">Fixed assets,
net of accumulated depreciation</font></td>
<td style="border-bottom: black 2.5pt double; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.5pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">4,227</font></td>
<td style="text-align: left; padding-bottom: 2.5pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 2.5pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 2.5pt double; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.5pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">4,459</font></td>
<td style="text-align: left; padding-bottom: 2.5pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
</table>
<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">Depreciation expense for the six months ended
June 30, 2013 and 2012 was $667 and $628, respectively.</p>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"> </p>
<table cellspacing="0" cellpadding="0" align="center" style="width: 50%; border-collapse: collapse; font-size: 10pt">
<tr style="vertical-align: bottom">
<td style="text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">June
30, 2013</font></td>
<td style="padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">December
31, 2012</font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; width: 55%"><font style="font: 10pt Times New Roman, Times, Serif">Machinery and equipment</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 20%"><font style="font: 10pt Times New Roman, Times, Serif">48,163</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 20%"><font style="font: 10pt Times New Roman, Times, Serif">45,208</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Furniture and fixtures</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">113,635</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">113,635</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Computers, equipment and software</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">38,540</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">38,105</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Leasehold improvements</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">12,569</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">12,569</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif">Lab equipment</font></td>
<td style="border-bottom: black 1pt solid; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">113,461</font></td>
<td style="text-align: left; padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">113,461</font></td>
<td style="text-align: left; padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Total</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">326,368</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">322,978</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif">Less: accumulated
depreciation</font></td>
<td style="border-bottom: black 1pt solid; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(322,141</font></td>
<td style="text-align: left; padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(318,519</font></td>
<td style="text-align: left; padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify; padding-bottom: 2.5pt"><font style="font: 10pt Times New Roman, Times, Serif">Fixed assets,
net of accumulated depreciation</font></td>
<td style="border-bottom: black 2.5pt double; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.5pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">4,227</font></td>
<td style="text-align: left; padding-bottom: 2.5pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 2.5pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 2.5pt double; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.5pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">4,459</font></td>
<td style="text-align: left; padding-bottom: 2.5pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
</table>
<p style="margin: 0pt"></p>
48163
45208
113635
113635
38540
38105
12569
12569
113461
113461
326368
322978
667
628
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Patents
and trademarks are capitalized at its historical cost and are amortized over their useful lives. As of June 30, 2013, patents
and trademarks total $317,211, net of $229,721 of accumulated amortization. Amortization expense for the six months ended June
30, 2013 and 2012 was $16,515 and $34,986, respectively.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">License
and distributor rights (“agreement”) were acquired by the Company in January 1999 and provide exclusive use distribution
of polymers and polymer based products. The Company has a non-expiring term on the license and distribution rights. Accordingly,
the Company annually assesses this license and distribution rights for impairment and has determined that no impairment write-down
is considered necessary as of June 30, 2013.</font></p>
<p style="margin: 0pt"></p>
317211
229721
16515
34986
<p style="margin: 0pt"><font style="font: 10pt Times New Roman, Times, Serif">On January 16, 2013, the company terminated its
licensing agreement with Panalab dated January 23, 2008. The agreement provided Panalab the right to distribute, market, sell
and promote Skinvisible’s proprietary formulas made with Invisicare and Adapalene through-out Panalabs assigned territory.
Panalab had failed to sell or sub-license the products in the territory, thereby not fulfilling the conditions as set forth in
the agreement and allowing for immediate termination of the agreement. As a result of this cancelation, unearned revenue of $19,792
has been recognized as revenue during the six months ended June 30, 2013.</font></p>
19792
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The
following is a summary of option activity during the six months ended June 30, 2013.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<table cellspacing="0" cellpadding="0" align="center" style="width: 50%; border-collapse: collapse; font-size: 10pt">
<tr style="vertical-align: bottom">
<td style="text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Number
of Shares</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Weighted
Average Exercise Price</font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt; width: 55%"><font style="font: 10pt Times New Roman, Times, Serif">Balance,
December 31, 2012</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right; width: 20%"><font style="font: 10pt Times New Roman, Times, Serif">9,400,000</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 20%"><font style="font: 10pt Times New Roman, Times, Serif">0.05</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif">Options granted
and assumed</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif">Options expired</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">400,000</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.05</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif">Options canceled</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify; padding-bottom: 1pt; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif">Options
exercised</font></td>
<td style="border-bottom: black 1pt solid; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td style="text-align: left; padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td style="text-align: left; padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify; padding-bottom: 2.5pt; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif">Balance,
June 30, 2013</font></td>
<td style="border-bottom: black 2.5pt double; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 2.5pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">9,000,000</font></td>
<td style="text-align: left; padding-bottom: 2.5pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 2.5pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 2.5pt double; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.5pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.05</font></td>
<td style="text-align: left; padding-bottom: 2.5pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0px"><font style="font: 10pt Times New Roman, Times, Serif">As
of June 30, 2013, 9,000,000 stock options are exercisable.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Stock
warrants -</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The
following is a summary of warrants activity during the six months ended June 30, 2013.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<table cellspacing="0" cellpadding="0" align="center" style="width: 50%; border-collapse: collapse; font-size: 10pt">
<tr style="vertical-align: bottom">
<td style="text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Number
of Shares</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Weighted
Average Exercise Price</font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt; width: 55%"><font style="font: 10pt Times New Roman, Times, Serif">Balance,
December 31, 2012</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right; width: 20%"><font style="font: 10pt Times New Roman, Times, Serif">6,765,200</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 20%"><font style="font: 10pt Times New Roman, Times, Serif">0.06</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif">Warrants granted
and assumed</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">271,280</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.06</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif">Warrants expired</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,562,500</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.05</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif">Warrants canceled</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify; padding-bottom: 1pt; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif">Warrants
exercised</font></td>
<td style="border-bottom: black 1pt solid; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td style="text-align: left; padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td style="text-align: left; padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify; padding-bottom: 2.5pt; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif">Balance,
June 30, 2013</font></td>
<td style="border-bottom: black 2.5pt double; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 2.5pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">5,473,980</font></td>
<td style="text-align: left; padding-bottom: 2.5pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 2.5pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 2.5pt double; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.5pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.06</font></td>
<td style="text-align: left; padding-bottom: 2.5pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">All
warrants outstanding as of June 30, 2013 are exercisable.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">271,280
warrants were issued during the three months ended March 31, 2013 as part of a series of convertible notes with attached warrants.
The warrants issued allow the holder to purchase one share for every two shares issued upon conversion at an exercise price of
$0.07 cents per share.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">On
May 22, 2013 200,000 warrants were issued as compensation for consulting services. The warrants issued allow the holder to purchase
one share at an exercise price of $0.04 cents per share.</font></p>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"> </p>
<table cellspacing="0" cellpadding="0" align="center" style="width: 50%; border-collapse: collapse; font-size: 10pt">
<tr style="vertical-align: bottom">
<td style="text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Number
of Shares</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Weighted
Average Exercise Price</font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt; width: 55%"><font style="font: 10pt Times New Roman, Times, Serif">Balance,
December 31, 2012</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right; width: 20%"><font style="font: 10pt Times New Roman, Times, Serif">9,400,000</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 20%"><font style="font: 10pt Times New Roman, Times, Serif">0.05</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif">Options granted
and assumed</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif">Options expired</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">400,000</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.05</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif">Options canceled</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify; padding-bottom: 1pt; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif">Options
exercised</font></td>
<td style="border-bottom: black 1pt solid; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td style="text-align: left; padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td style="text-align: left; padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify; padding-bottom: 2.5pt; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif">Balance,
June 30, 2013</font></td>
<td style="border-bottom: black 2.5pt double; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 2.5pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">9,000,000</font></td>
<td style="text-align: left; padding-bottom: 2.5pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 2.5pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 2.5pt double; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.5pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.05</font></td>
<td style="text-align: left; padding-bottom: 2.5pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"> </p>
<table cellspacing="0" cellpadding="0" align="center" style="width: 50%; border-collapse: collapse; font-size: 10pt">
<tr style="vertical-align: bottom">
<td style="text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Number
of Shares</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Weighted
Average Exercise Price</font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt; width: 55%"><font style="font: 10pt Times New Roman, Times, Serif">Balance,
December 31, 2012</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right; width: 20%"><font style="font: 10pt Times New Roman, Times, Serif">6,765,200</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 20%"><font style="font: 10pt Times New Roman, Times, Serif">0.06</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif">Warrants granted
and assumed</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">271,280</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.06</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif">Warrants expired</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,562,500</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.05</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif">Warrants canceled</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify; padding-bottom: 1pt; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif">Warrants
exercised</font></td>
<td style="border-bottom: black 1pt solid; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td style="text-align: left; padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td style="text-align: left; padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify; padding-bottom: 2.5pt; padding-left: 0.75pt"><font style="font: 10pt Times New Roman, Times, Serif">Balance,
June 30, 2013</font></td>
<td style="border-bottom: black 2.5pt double; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 2.5pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">5,473,980</font></td>
<td style="text-align: left; padding-bottom: 2.5pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 2.5pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 2.5pt double; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.5pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.06</font></td>
<td style="text-align: left; padding-bottom: 2.5pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
</table>
<p style="margin: 0pt"></p>
9000000
9400000
0.05
0.05
400000
0.05
6973980
6765200
0.06
0.06
271280
0.06
1562500
0.05
9000000
0.04
0.07
200000
271280
2013-05-22
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Various
officers advanced funds to support the daily operations of the company. As of June 30, 2013, $134 remained due to related parties,
which is an unsecured payable due to an officer of the Company bearing no interest and due on demand.</font></p>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<table cellspacing="0" cellpadding="0" align="center" style="width: 80%; border-collapse: collapse; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td style="text-align: justify">Convertible Notes Payable at consists of the following:</td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center">June 30, 2013</td>
<td> </td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center">December 31, 2012</td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-left: 5.4pt; width: 69%">$52,476 face value,10% unsecured note payable to an investor, note interest and payment are due on demand. The note could be converted to option rights for Skinvisible, Inc. shares at ten cents per share ($0.10), these rights expired January 12, 2010. Note is currently in default, no penalties occur due to default. <br />
<br />During the six months ended June 30, 2013, the Company made $8,000 cash payment to reduce to the note balance.</td>
<td style="text-align: left; width: 1%">$</td>
<td style="text-align: right; width: 13%">44,476</td>
<td style="text-align: left; width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="text-align: left; width: 1%">$</td>
<td style="text-align: right; width: 13%">52,476</td>
<td style="text-align: left; width: 1%"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"> </td>
<td style="text-align: left"> </td>
<td 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="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-left: 5.4pt">$27,000 face value 10% unsecured $27,000 notes payable to investors, due October, 2012. At the written request of the investor’s until the repayment date, the note may be converted at the investors option to shares of the Company’s common stock at a fixed price of $0.05 per share along with additional warrants to purchase one share for every two shares issued at the exercise price of $0.07 per share for two years after the conversion date. The Company has determined the value associated with the beneficial conversion feature in connection with the notes to be $19,385. The aggregate beneficial conversion feature has been fully accreted and was charged to general and administrative expenses during the year ended December 31, 2012. The beneficial conversion feature is valued under the intrinsic value method. Interest due to lender can also be converted at a rate of ($0.05) per share into warrants. <br /> <br />During the six months ended June 30, 2013, the Company made a $2,000 cash payment to reduce the note balance and converted principal of $15,000 plus accrued interest of $1,277 to 542,560 shares of common stock and granted 271,280 warrants with the exercise price of $0.07 per shares for two years.</td>
<td style="text-align: left"> </td>
<td style="text-align: right">10,000</td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">27,000</td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"> </td>
<td style="text-align: left"> </td>
<td 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="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-bottom: 1pt; padding-left: 5.4pt">$1,000,000 face value 9% notes payable to investor, due August 1, 2014. At the investor’s option until the repayment date, the note and related interest may be converted to shares of the Company’s common stock a discount of 90% of the current share price after the first anniversary of the note. The Notes are secured by the accounts receivable of a license agreement the Company has with Women's Choice Pharmaceuticals, LLC on its proprietary prescription product, ProCort®. The Company has determined the value associated with the beneficial conversion feature in connection with the notes and interest to be $111,110. The aggregate original issue discount feature has been accreted and charged to general and administrative expenses as a financing expense in the amount of $26,491 and $8,910 during the periods ending June 30, 2013 and December 31, 2012, respectively. The original issue discount feature is valued under the intrinsic value method.</td>
<td style="border-bottom: black 1pt solid; text-align: left"> </td>
<td style="border-bottom: black 1pt solid; text-align: right">1,000,000</td>
<td style="text-align: left; padding-bottom: 1pt"> </td>
<td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: black 1pt solid; text-align: left"> </td>
<td style="border-bottom: black 1pt solid; text-align: right">1,000,000</td>
<td style="text-align: left; padding-bottom: 1pt"> </td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.5in">Original issue discount</td>
<td style="text-align: left"> </td>
<td style="text-align: right">111,110</td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">111,110</td>
<td style="text-align: left"> </td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-bottom: 1pt; padding-left: 0.5in">Unamortized debt discount</td>
<td style="border-bottom: black 1pt solid; text-align: left"> </td>
<td style="border-bottom: black 1pt solid; text-align: right">(75,709</td>
<td style="text-align: left; padding-bottom: 1pt">)</td>
<td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: black 1pt solid; text-align: left"> </td>
<td style="border-bottom: black 1pt solid; text-align: right">(102,200</td>
<td style="text-align: left; padding-bottom: 1pt">)</td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-bottom: 2.5pt; padding-left: 5.4pt"> </td>
<td style="border-bottom: black 2.5pt double; text-align: left">$</td>
<td style="border-bottom: black 2.5pt double; text-align: right">1,089,877</td>
<td style="text-align: left; padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.5pt double; text-align: left">$</td>
<td style="border-bottom: black 2.5pt double; text-align: right">1,088,386</td>
<td style="text-align: left; padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"> </p>
<table cellspacing="0" cellpadding="0" align="center" style="width: 80%; border-collapse: collapse; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td style="text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Convertible Notes Payable at consists
of the following:</font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">June
30, 2013</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: black 1pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">December
31, 2012</font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-left: 5.4pt; width: 69%"><font style="font: 10pt Times New Roman, Times, Serif">$52,476
face value,10% unsecured note payable to an investor, note interest and payment are due on demand. The note could be converted
to option rights for Skinvisible, Inc. shares at ten cents per share ($0.10), these rights expired January 12, 2010. Note
is currently in default, no penalties occur due to default. <br />
<br />During the six months ended June 30, 2013, the Company made $8,000 cash payment to reduce to the note balance.</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 13%"><font style="font: 10pt Times New Roman, Times, Serif">44,476</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; width: 13%"><font style="font: 10pt Times New Roman, Times, Serif">52,476</font></td>
<td style="text-align: left; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif">$27,000 face value
10% unsecured $27,000 notes payable to investors, due October, 2012. At the written request of the investor’s until the
repayment date, the note may be converted at the investors option to shares of the Company’s common stock at a fixed
price of $0.05 per share along with additional warrants to purchase one share for every two shares issued at the exercise
price of $0.07 per share for two years after the conversion date. The Company has determined the value associated with the
beneficial conversion feature in connection with the notes to be $19,385. The aggregate beneficial conversion feature has
been fully accreted and was charged to general and administrative expenses during the year ended December 31, 2012. The beneficial
conversion feature is valued under the intrinsic value method. Interest due to lender can also be converted at a rate of ($0.05)
per share into warrants. <br /> <br />During the six months ended June 30, 2013, the Company made a $2,000 cash payment to
reduce the note balance and converted principal of $15,000 plus accrued interest of $1,277 to 542,560 shares of common stock
and granted 271,280 warrants with the exercise price of $0.07 per shares for two years.</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">10,000</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">27,000</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-bottom: 1pt; padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif">$1,000,000
face value 9% notes payable to investor, due August 1, 2014. At the investor’s option until the repayment date, the note
and related interest may be converted to shares of the Company’s common stock a discount of 90% of the current share
price after the first anniversary of the note. The Notes are secured by the accounts receivable of a license agreement the
Company has with Women's Choice Pharmaceuticals, LLC on its proprietary prescription product, ProCort®. The Company has
determined the value associated with the beneficial conversion feature in connection with the notes and interest to be $111,110.
The aggregate original issue discount feature has been accreted and charged to general and administrative expenses as a financing
expense in the amount of $26,491 and $8,910 during the periods ending June 30, 2013 and December 31, 2012, respectively. The
original issue discount feature is valued under the intrinsic value method.</font></td>
<td style="border-bottom: black 1pt solid; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,000,000</font></td>
<td style="text-align: left; padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,000,000</font></td>
<td style="text-align: left; padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="text-align: justify; padding-left: 0.5in"><font style="font: 10pt Times New Roman, Times, Serif">Original issue
discount</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">111,110</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">111,110</font></td>
<td style="text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="background-color: rgb(204,238,204); vertical-align: bottom">
<td style="text-align: justify; padding-bottom: 1pt; padding-left: 0.5in"><font style="font: 10pt Times New Roman, Times, Serif">Unamortized
debt discount</font></td>
<td style="border-bottom: black 1pt solid; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(75,709</font></td>
<td style="text-align: left; padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 1pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(102,200</font></td>
<td style="text-align: left; padding-bottom: 1pt"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="background-color: white; vertical-align: bottom">
<td style="padding-bottom: 2.5pt; padding-left: 5.4pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 2.5pt double; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.5pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,089,877</font></td>
<td style="text-align: left; padding-bottom: 2.5pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 2.5pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: black 2.5pt double; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.5pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,088,386</font></td>
<td style="text-align: left; padding-bottom: 2.5pt"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
</table>
<p style="margin: 0pt"></p>
44476
52476
10000
27000
1000000
1000000
111110
111110
75709
102200
52476
27000
1000000
0.1
0.1
0.09
0.05
0.05
0.10
0.07
0.07
8000
2000
15000
15000
1277
1277
300000
542560
271280
0.07
P2Y
19385
26491
8910
2012-10-01
2014-08-01
0.05
0.05
0.9
2010-01-12
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">On
December 31, 2011, the Company re-negotiated accrued salaries and interest for three employees. Under the terms of the agreements,
the notes dated before December 31, 2010 and all salaries not previously converted were converted to promissory notes convertible
into common stock with a warrant feature. The $802,864 face value promissory notes are unsecured, due five years from issuance,
and bear an interest rate of 10%. At the investor’s option until the repayment date, the note may be converted to shares
of the Company’s common stock at a fixed price of $0.04 per share along with additional warrants to purchase one share for
every two shares issued at the exercise price of $0.06 per share for three years after the conversion date. The Company has determined
the value associated with the beneficial conversion feature in connection with the notes to be $538,295 for the notes negotiated
on December 31, 2010, $45,557 for the notes negotiated on July 1, 2011 and $1,123,078 for the notes negotiated December 31, 2011.
The beneficial conversion feature is valued under the intrinsic value method. The aggregate beneficial conversion feature has
been accreted and charged to general and administrative expenses as a financing expense in the amount of $82,846 for the six months
ended June 30, 2013. As of June 30, 2013, the aggregate convertible notes payable are $526,666, net of unamortized beneficial
conversion feature of $583,937.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">On
June 30, 2012, the Company re-negotiated accrued salaries and interest for three employees. Under the terms of the agreements,
the notes dated before July 1, 2011 and all salaries not previously converted were converted to promissory notes convertible into
common stock with a warrant feature. The $325,023 face value promissory notes are unsecured, due five years from issuance, and
bear an interest rate of 10%. At the investor’s option until the repayment date, the note may be converted to shares of the
Company’s common stock at a fixed price of $0.04 per share along with additional warrants to purchase one share for every
two shares issued at the exercise price of $0.06 per share for three years after the conversion date. The Company has determined
the value associated with the beneficial conversion feature in connection with the notes to be $209,809. The beneficial conversion
feature is valued under the intrinsic value method. The aggregate beneficial conversion feature has been accreted and charged
to general and administrative expenses as a financing expense in the amount of $21,680 for the six months ended June 30, 2013.
As of June 30, 2013, the aggregate convertible notes payable are $158,599, net of unamortized beneficial conversion feature of
$166,423.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">On
December 30 and 31, 2012, the Company re-negotiated accrued salaries and interest for three employees. Under the terms of the
agreements, $182,083 of related party notes accrued interest and salaries not previously converted were converted to promissory
notes convertible into common stock with a warrant feature. The $182,083 face value promissory notes are unsecured, due five years
from issuance, and bear an interest rate of 10%. At the investor’s option until the repayment date, the note may be converted
to shares of the Company’s common stock at a fixed price of $0.03 per share along with additional warrants to purchase one
share for every two shares issued at the exercise price of $0.04 per share for three years after the conversion date. The Company
has determined the value associated with the beneficial conversion feature in connection with the notes to be $182,083. The beneficial
conversion feature is valued under the intrinsic value method. The aggregate beneficial conversion feature has been accreted and
charged to general and administrative expenses as a financing expense in the amount of $18,048 for the six months ended June 30,
2013. As of June 30, 2013, the aggregate convertible notes payable are $18,061, net of unamortized beneficial conversion feature
of $164,022.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">On
June 30, 2013, the Company re-negotiated accrued salaries and interest for two employees. Under the terms of the agreements, $106,153
of related party notes accrued interest and salaries not previously converted were converted to promissory notes convertible into
common stock with a warrant feature. The $106,153 face value promissory notes are unsecured, due five years from issuance, and
bear an interest rate of 10%. At the investor’s option until the repayment date, the note may be converted to shares of the
Company’s common stock at a fixed price of $0.03 per share along with additional warrants to purchase one share for every
two shares issued at the exercise price of $0.04 per share for three years after the conversion date. The Company has determined
the value associated with the beneficial conversion feature in connection with the notes to be $70,768. The beneficial conversion
feature is valued under the intrinsic value method. The aggregate beneficial conversion feature will be accreted and charged to
general and administrative expenses as a financing expense As of June 30, 2013, the aggregate convertible notes payable are $35,384,
net of unamortized beneficial conversion feature of $70,768.</font></p>
802864
325023
182083
106153
P5Y
P5Y
P5Y
P5Y
0.1
0.1
0.1
0.1
0.04
0.04
0.03
0.03
1
1
1
1
0.06
0.06
0.04
0.04
P3Y
P3Y
P3Y
P3Y
538295
45557
1123078
209809
182083
70768
82846
21680
18048
<p style="margin: 0pt"><font style="font: 10pt Times New Roman, Times, Serif">On May 22, 2013 the Company approved a financing
plan to offer accredited investors up to $1,000,000 in secured promissory notes. During the quarter ended June 30, 2013 the Company
entered into twelve <font style="color: black">9% notes payable to investors</font> and received total proceeds of $430,000. The
notes are<font style="color: black"> due two years from the anniversary date of execution. </font>The Notes are secured by the
US Patent rights granted for the Company's Sunscreen Products: US patent number #8,128,913: "Sunscreen Composition with Enhanced
UV-A Absorber Stability and Methods".</font></p>
2013-05-22
1000000
0.09
0.09
430000
166000
P2Y
P2Y
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The
Company is authorized to issue 200,000,000 shares of $0.001 par value common stock. The Company has 110,490,969 and 109,507,409
issued and outstanding shares of common stock as of June 30, 2013 and December 31, 2012, respectively.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">During
the six months ended June 30, 2013, the Company issued a total of 440,000 shares of common stock, with a fair value of $13,700
for the conversion of debts totaling $14,400. The Company recorded a gain of $700 on extinguishment of debts.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">On
February 11, 2013, the Company issued a total of 300,000 shares of common stock for conversion of principal on convertible notes
payable of $15,000 plus $1,277 accrued interest. The Company issued an additional 242,560 shares of common stock for this conversion
of convertible notes payable, which the shares were fair valued at $7,277.</font></p>
<p style="margin: 0pt"></p>
440000
13700
14400
2013-02-11
242560
7277
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><u>Lease
obligations </u>– The Company has operating leases for its offices. Future minimum lease payments under the operating leases
for the facilities as of June 30, 2013 are as follows:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Fiscal
year ending 2013 24,457</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Fiscal
year ending 2014 33,156</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Fiscal
year ending 2015 5,526</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Rental
expense, resulting from operating lease agreements, approximated $14,282 and $31,623 for the six months ended June 30, 2013 and
2012, respectively.</font></p>
<p style="margin: 0pt"></p>
14282
31623
24457
33156
5526
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">During
the month ended July 2013 the Company entered into four <font style="color: black">9% notes payable to investors</font> and received
total proceeds of $166,000. The notes are<font style="color: black">, due two years from the anniversary date of execution. </font>The
Notes are secured by the US Patent rights granted for the Company's Sunscreen Products: US patent number #8,128,913: "Sunscreen
Composition with Enhanced UV-A Absorber Stability and Methods".</font></p>
<p style="margin: 0pt"></p>
3580
-3580
To correct errors due to incorrect allocation of convertible debt.
To correct errors in debt discount of convertible notes payable.
$(398,180)-To correct errors in debt discount of convertible notes payable.
$28,799-To correct erros due to incorrect allocation of convertible debt.
$207-To correct errors due to incorrect allocation of convertible debt.
$3,975-To correct erros in debt discount of convertible notes payable.
$(48,841)-To correct errors in debt discount of convertible notes payable.
$(28,799)-To correct erros due to incorrect allocation of convertible debt.
$398,180-To correct errors in debt discount of convertible notes payable.
$(28,799)-To correct errors due to incorrect allocation of convertible debt.
$26,409-To correct erros in debt discount of convertible notes payable
$31,543-To correct erros due to incorrect allocation of convertible debt.
$(26,409)-To correct erros in debt discount of convertible notes payable.
$(31,543)-To correct erros due to incorrect allocation of convertible debt.
$48,841-To correct erros in debt discount of convertible notes payable.
$31,543-To correct errors due to incorrect allocation of convertible debt.
$(48,841)-To correct erros in debt discount of convertible notes payable.
$(28,799)-To correct errors due to incorrect allocation of convertible debt.
$(31,543)-To correct errors due to incorrect allocation of convertible debt.