10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

_______________

FORM 10-Q

_______________

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2012

or

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______to______.

MAX SOUND CORPORATION

 (Exact name of registrant as specified in charter)

DELAWARE	000-51886	26-3534190
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(I.R.S Employer Identification No.)

10685-B Hazelhurst Drive #6572

Houston, Texas 77043

 (Address of principal executive offices)

 _______________

210-401-7667

(Registrant’s telephone number, including area code)

_______________

Not applicable

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes x No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	x
(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes o No x

Indicate the number of shares outstanding of each of the issuer’s classes of common stock. As of August 13, 2012, there were 255,460,394 shares, par value $0.0001 per share, of common stock issued and outstanding.

MAX SOUND CORPORATION

FORM 10-Q

June 30, 2012

INDEX

PART I-- FINANCIAL INFORMATION

Item 1.	Financial Statements	1
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	43
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	50
Item 4.	Controls and Procedures	50

PART II-- OTHER INFORMATION

Item 1	Legal Proceedings	51
Item 1A	Risk Factors	51
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	51
Item 3.	Defaults Upon Senior Securities	51
Item 4.	Mine Safety Disclosures	51
Item 5.	Other Information	51
Item 6.	Exhibits	52

SIGNATURES

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

MAX SOUND CORPORATION

 (A DEVELOPMENT STAGE COMPANY)

CONTENTS

PAGE	1	CONDENSED BALANCE SHEETS AS OF JUNE 30, 2012 (UNAUDITED) AND AS OF DECEMBER 31, 2011 (AUDITED).
PAGE	2	CONDENSED STATEMENTS OF OPERATIONS FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2012 AND 2011 AND FOR THE PERIOD DECEMBER 9, 2005 (INCEPTION) TO JUNE 30, 2012 (UNAUDITED).
PAGE	3	CONDENSED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY FOR THE PERIOD FROM DECEMBER 9, 2005 (INCEPTION) TO JUNE 30, 2012 (UNAUDITED).
PAGE	4	CONDENSED STATEMENTS OF CASH FLOWS FOR THE SIX MONTHS ENDED JUNE 30, 2012 AND 2011 AND FOR THE PERIOD DECEMBER 9, 2005 (INCEPTION) TO JUNE 30, 2012 (UNAUDITED).
PAGES	5 - 42	NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED).

Max Sound Corporation
(A Development Stage Company)
Condensed Balance Sheets
ASSETS
	June 30, 2012			December 31, 2011
	(UNAUDITED)
Current Assets
Cash	$	114,903		$	516,532
Prepaid expenses		26,805			23,659
Debt offering costs - net		43,954			-
Total  Current Assets		185,662			540,191
Property and equipment, net		221,046			146,000
Other Assets
Security deposit		413			413
Intangible assets		7,800,275			7,800,275
Total  Other Assets		7,800,688			7,800,688
Total  Assets	$	8,207,396		$	8,486,879
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable	$	38,600		$	25,470
Accrued expenses		74,812			165,897
Derivative liability		708,783			-
Convertible note payable, net of debt discount of $331,364		443,970			-
Total Current Liabilities		1,266,165			191,367
Commitments and Contingencies
Stockholders' Equity
Preferred stock,  $0.0001 par value; 10,000,000 shares authorized,
No shares issued and outstanding		-			-
Common stock,  $0.0001 par value; 400,000,000 shares authorized,
255,335,394 and 255,184,661 shares issued and outstanding, respectively		25,534			25,519
Additional paid-in capital		22,709,948			22,629,977
Deficit accumulated during the development stage		(15,794,251	)		(14,359,984	)
Total Stockholders' Equity		6,941,231			8,295,512
Total Liabilities and Stockholders' Equity	$	8,207,396		$	8,486,879

See accompanying notes to condensed unaudited financial statements

1

Max Sound Corporation

(A Development Stage Company)

Condensed Statement of Operations

(UNAUDITED)

	For the Three Months Ended,						For the Six Months Ended,						For the Period From December 9, 2005 (Inception) to
	June 30, 2012			June 30, 2011			June 30, 2012			June 30, 2011			June 30, 2012
Revenue	$	-		$	-		$	-		$	-		$	23,826
Operating Expenses
General and administrative		144,717			32,243			338,332			69,135			961,700
Endorsement fees		-			411,900			-			819,273			4,942,277
Consulting		139,611			455,246			259,611			2,382,106			5,655,557
Professional fees		26,059			26,883			84,629			67,559			450,940
Website development		-			-			-			-			251,263
Compensation		162,000			54,000			324,000			108,000			2,982,343
Total Operating Expenses		472,387			980,272			1,006,572			3,446,073			15,244,080
Loss from Operations		(472,387	)		(980,272	)		(1,006,572	)		(3,446,073	)		(15,220,254	)
Other Income / (Expense)
Interest income		57			25			129			25			640
Gain on extinguishment of debt		-			-			-			-			6,643
Interest expense		(127,730	)		(2,647	)		(127,730	)		(5,682	)		(144,731	)
Amortization of debt offering costs		(29,178	)					(30,380	)		-			(30,380	)
Amortization of debt discount		(185,392	)		(3,139	)		(189,925	)		(9,371	)		(213,908	)
Change in fair value of embedded derivative liability		(9,285	)		17,040			(79,789	)		(32,085	)		(55,806	)
Total Other Income / (Expense)		(351,528	)		11,279			(427,695	)		(47,113	)		(437,542	)
Provision for Income  Taxes		-			-			-			-			-
Net Loss	$	(823,915	)	$	(968,993	)	$	(1,434,267	)	$	(3,493,186	)	$	(15,657,796	)
Net Loss Per Share  - Basic and Diluted	$	(0.00	)	$	(0.00	)	$	(0.01	)	$	(0.02	)
Weighted average number of shares outstanding
during the year Basic and Diluted		255,335,394			234,809,929			255,274,304			231,642,501

See accompanying notes to condensed unaudited financial statements

2

Max Sound Corporation
(A Development Stage Company)
Condensed Statement of Changes in Stockholders' Equity
For the Period from December 9, 2005 (Inception) to June 30, 2012
(UNAUDITED)
	Preferred stock				Common stock						Additional												Total
											paid-in			Accumulated			Subscription			Deferred			Stockholder's
	Shares		Amount		Shares			Amount			capital			Deficit			Receivable			Compensation			Equity
Balance, December 9, 2005 (Inception)		-	$	-		-		$	-		$	-		$	-		$	-		$	-		$	-
Stock issued on acceptance of incorporation expenses		-		-		100,000			10			90			-			-			-			100
Net loss for the period December 9, 2005 (Inception) to December 31, 2005		-		-		-			-			-			(400	)		-			-			(400	)
Balance, December 31, 2005		-		-		100,000			10			90			(400	)		-			-			(300	)
Net loss for the year ended December 31, 2006		-		-		-			-			-			(1,450	)		-			-			(1,450	)
Balance, December 31, 2006		-		-		100,000			10			90			(1,850	)		-			-			(1,750	)
Net loss for the year ended December 31, 2007		-		-		-			-			-			(1,400	)		-						(1,400	)
Balance, December 31, 2007		-		-		100,000			10			90			(3,250	)		-			-			(3,150	)
Common stock issued for services to founder ($0.001/sh)		-		-		44,900,000			4,490			40,410			-			-			-			44,900
Common stock issued for cash ($0.25/sh)		-		-		473,000			47			118,203			-			(67,750	)		-			50,500
Common stock issued for services ($0.25/sh)		-		-		12,000			1			2,999			-			-			-			3,000
Shares issued in connection with stock dividend		-		-		136,455,000			13,646			122,809			(136,455	)		-			-			-
In kind contribution of rent - related party		-		-		-			-			2,913			-			-			-			2,913
Accrued expenses payment made by a former shareholder		-		-		-			-			4,400			-			-			-			4,400
Net loss for the year ended December 31, 2008		-		-		-			-			-			(117,115	)		-			-			(117,115	)
Balance, December 31, 2008		-		-		181,940,000			18,194			291,824			(256,820	)		(67,750	)		-			(14,552	)
Common stock issued for cash ($0.25/sh)		-		-		62,000			6			15,494			-			-			-			15,500
Common stock issued for services ($0.25/sh)		-		-		24,000			2			5,998			-			-			-			6,000
Common stock issued for services ($0.35/sh)		-		-		1,700,000			170			594,830			-			-			(499,333	)		95,667
Common stock issued for services ($0.0625/sh)		-		-		935,714			94			58,388			-			-			-			58,482
Warrants issued for services		-		-		-			-			823,077			-			-			-			823,077
Common stock issued for services ($1.50/sh)		-		-		30,000			3			44,997			-			-			(39,699	)		5,301
Common stock issued for services ($1.77/sh)		-		-		30,000			3			53,097			-			-			(53,100	)		-
Common stock issued for services ($1.78/sh)		-		-		100,000			10			177,990			-			-			(166,052	)		11,948
Common stock issued for services ($1.80/sh)		-		-		100,000			10			179,990			-			-			(168,904	)		11,096
Common stock issued for services ($1.93/sh)		-		-		2,830,000			283			5,461,617			-			-			(5,459,098	)		2,802
Common stock issued for services ($1.94/sh)		-		-		30,000			3			58,197			-			-			(58,200	)		-
Common stock issued for services ($1.95/sh)		-		-		920,000			92			1,793,908			-			-			(1,135,808	)		658,192
Common stock issued for services ($2.00/sh)		-		-		300,000			30			599,970			-			-			(506,423	)		93,577
Return of common stock issued for services ($0.35/sh)		-		-		(1,100,000	)		(110	)		(384,890	)		-			-			385,000			-
Shares issued in connection with stock dividend		-		-		258,000			26			(26	)		-			-			-			-
Stock offering costs		-		-		-			-			(850	)		-			-			-			(850	)
Collection of subscription receivable		-		-		-			-			-			-			67,750			-			67,750
In kind contribution of rent - related party		-		-		-			-			12,600			-			-			-			12,600
Deferred compensation realized		-		-		-			-			-			-			-			114,333			114,333
Net loss for the year ended December 31, 2009		-		-		-			-			-			(2,298,552	)		-			-			(2,298,552	)
Balance, December 31, 2009		-		-		188,159,714			18,816			9,786,211			(2,555,372	)		-			(7,587,284	)		(337,629	)
Common stock issued for cash ($0.25/sh)		-		-		1,200,000			120			299,880			-			-			-			300,000
Accrued salary conversion into common stock ($0.30/sh)		-		-		945,507			95			283,557			-			-			-			283,652
Common stock issued for services ($0.15/sh)		-		-		250,000			25			37,475			-			-			-			37,500
Common stock issued for services ($0.18/sh)		-		-		100,000			10			17,990			-			-			-			18,000
Common stock issued for services ($0.19/sh)		-		-		100,000			10			18,990			-			-			-			19,000
Common stock issued for services ($0.20/sh)		-		-		210,000			21			41,979			-			-			-			42,000
Common stock issued for services ($0.25/sh)		-		-		140,000			14			34,986			-			-			-			35,000
Common stock issued in exchange for technology rights ($0.25/sh)		-		-		30,000,000			3,000			7,497,000			-			-			-			7,500,000
Return of common stock issued for services ($1.05/sh)		-		-		(150,000	)		(15	)		15			-			-			-			-
Common stock issued for services ($1.24/Sh)		-		-		1,000,000			100			1,239,900			-			-			(1,097,315	)		142,685
Common stock issued for services ($1.70/sh)		-		-		100,000			10			169,990			-			-			(152,534	)		17,466
Cancellation of shares held in escrow ($1.93/sh)		-		-		(1,000,000	)		(100	)		(1,929,900	)		-			-			487,802			(1,442,198	)
Warrants issued for services		-		-		-			-			10,559			-			-			-			10,559
Blue sky fees		-		-		-			-			(400	)		-			-			-			(400	)
Stock and financing offering costs		-		-		-			-			(8,000	)											(8,000	)
In kind contribution of rent - related party		-		-		-			-			9,450			-			-			-			9,450
Deferred compensation realized		-		-		-			-			-			-			-			6,546,046			6,546,046
Net loss for the year ended December 31, 2010		-		-		-			-			-			(6,312,965	)		-			-			(6,312,965	)
Balance, December 31, 2010		-		-		221,055,221			22,106			17,509,682			(8,868,337	)		-			(1,803,285	)		6,860,166
Common stock issued in exchange for assets ($0.10/sh)		-		-		3,000,000			300			299,700			-			-			-			300,000
Common stock issued for services ($0.07/sh)		-		-		2,000,000			200			139,800			-			-			-			140,000
Common stock issued for services ($0.08/sh)		-		-		1,006,500			101			80,419			-			-			-			80,520
Common stock issued for services ($0.10/sh)		-		-		3,066,462			307			306,339			-			-			-			306,646
Common stock issued for services ($0.11/sh)		-		-		500,000			50			54,950			-			-			-			55,000
Common stock issued for services ($0.22/sh)		-		-		15,403			2			3,387			-			-			-			3,389
Common stock issued for services ($0.23/sh)		-		-		100,000			10			22,990			-			-			-			23,000
Common stock issued for services ($0.25/sh)		-		-		702,860			70			175,645			-			-			-			175,715
Common stock issued for services ($0.33/sh)		-		-		100,000			10			32,990			-			-			-			33,000
Common stock issued for services ($0.35/sh)		-		-		2,443			-			855			-			-			-			855
Common stock issued for services ($0.39/sh)		-		-		101,500			10			39,575			-			-			-			39,585
Common stock issued for services ($0.47/sh)		-		-		123,795			12			58,172			-			-			-			58,184
Common stock issued for services ($0.50/sh)		-		-		100,000			10			49,990			-			-			-			50,000
Common stock issued for services ($0.54/sh)		-		-		200,000			20			107,980			-			-			-			108,000
Common stock issued for services ($0.70/sh)		-		-		100,000			10			69,990			-			-			-			70,000
Common stock issued for services ($0.88/sh)		-		-		100,000			10			87,990			-			-			-			88,000
Convertible debt conversion into common stock ($0.0295/sh)		-		-		271,186			27			7,973			-			-			-			8,000
Convertible debt conversion into common stock ($0.0315/sh)		-		-		587,382			59			18,444			-			-			-			18,503
Convertible debt conversion into common stock ($0.032/sh)		-		-		109,375			11			3,489			-			-			-			3,500
Convertible debt conversion into common stock ($0.0336/sh)		-		-		357,143			36			11,964			-			-			-			12,000
Convertible debt conversion into common stock ($0.0454/sh)		-		-		220,264			22			9,978			-			-			-			10,000
Convertible debt conversion into common stock ($0.1339/sh)		-		-		116,505			12			15,588			-			-			-			15,600
Convertible debt conversion into common stock ($0.1455/sh)		-		-		96,220			9			13,991			-			-			-			14,000
Convertible debt conversion into common stock ($0.1554/sh)		-		-		77,220			8			11,992			-			-			-			12,000
Accrued salary conversion into common stock ($0.11/sh)		-		-		1,309,091			131			143,869			-			-			-			144,000
Line of credit conversion into common stock ($0.11/sh)		-		-		909,091			91			99,909			-			-			-			100,000
Common stock issued for cash ($0.10/sh)		-		-		18,857,000			1,886			1,883,814			-			-			-			1,885,700
Warrants issued for services		-		-		-			-			248,498			-			-			-			248,498
Stock offering costs		-		-		-			-			(79,780	)		-			-			-			(79,780	)
Amortization of stock options		-		-		-			-			1,199,794			-			-			-			1,199,794
Deferred compensation realized		-		-		-			-			-			-			-			1,803,285			1,803,285
Net loss for the year ended December 31, 2011		-		-		-			-			-			(5,491,647	)		-			-			(5,491,647	)
Balance, December 31, 2011		-		-		255,184,661			25,519			22,629,977			(14,359,984	)		-			-			8,295,512
Common stock issued for services ($0.62/sh)		-		-		733			-			455			-			-			-			455
Common stock issued for services ($0.21/sh)		-		-		150,000			15			31,485			-			-			-			31,500
Warrants issued for services		-		-		-			-			48,031			-			-			-			48,031
Net loss for the six months ended June 30, 2012		-		-		-			-			-			(1,434,267	)		-			-			(1,434,267	)
Balance, June 30, 2012		-	$	-		255,335,394		$	25,534		$	22,709,948		$	(15,794,251	)	$	-		$	-		$	6,941,231

See accompanying notes to condensed unaudited financial statements

3

Max Sound Corporation
(A Development Stage Company)
Condensed Statements of Cash Flows
(UNAUDITED)
	For the Six Months Ended,						For the Period From December 9, 2005 (Inception) to
	June 30, 2012			June 30, 2011			June 30, 2012
Cash Flows From Operating Activities:
Net Loss	$	(1,434,267	)	$	(3,493,186	)	$	(15,657,796	)
Adjustments to reconcile net loss to net cash used in operations
Depreciation/Amortization		22,354			19,136			106,100
Depreciation for abandonment of website		-			-			38,794
In kind contribution of rent - related party		-			-			24,963
Stock issued for services		31,955			651,598			2,566,565
Warrants issued for services		48,031			-			1,130,165
Amortization of stock options		-			1,199,794			1,199,794
Bluesky Fees		-			-			(1,750	)
Amortization of stock based compensation		-			1,049,285			7,021,466
Security deposit		-			(300	)		(413	)
Amortization of debt offering costs		30,380			-			30,380
Amortization of debt discount		189,925			9,371			164,993
Change in fair value of derivative liability		187,494			32,085			212,426
Changes in operating assets and liabilities:
(Increase)/Decrease in prepaid expenses		(3,146	)		4,944			(26,805	)
Increase/(Decrease) accounts payable		13,130			(27,677	)		38,600
Increase(Decrease) in warrant liabilities		-			162,746			-
Increase/(Decrease) in accrued expenses		(91,085	)		130,230			506,066
Net Cash Used In Operating Activities		(1,005,229	)		(261,974	)		(2,646,452	)
Cash Flows From Investing Activities:
Register of trademark		-			-			(275	)
Purchase of property equipment		(97,400	)		-			(365,940	)
Net Cash Used In Investing Activities		(97,400	)		-			(366,215	)
Cash Flows From Financing Activities:
Proceeds from stockholder loans		-			81,150			620,583
Repayment of stockholder loans		-			(85,000	)		(520,583	)
Accrued expenses payment made by a former shareholder		-			-			4,400
Proceeds from issuance of convertible note, net of offering costs		701,000			37,500			785,500
Proceeds from issuance of stock, net of subscriptions receivable and net of offering costs		-			354,000			1,772,920
Proceeds from collection of stock subscription receivable		-			-			464,750
Net Cash Provided by Financing Activities		701,000			387,650			3,127,570
Net Increase / (Decrease) in Cash		(401,629	)		125,676			114,903
Cash at Beginning of Period		516,532			297			-
Cash at End of Period	$	114,903		$	125,973		$	114,903
Supplemental disclosure of cash flow information:
Cash paid for interest	$	-		$	-		$	-
Cash paid for taxes	$	-		$	-		$	-
Supplemental disclosure of non-cash investing and financing activities:
Shares issued in connection with intellectual property	$	-		$	300,000		$	7,800,000
Shares issued in conversion of related party accrued compensation	$	-		$	144,000		$	427,652
Shares issued in conversion of related party line of credit	$	-		$	100,000		$	100,000
Shares issued in conversion of convertible debt and accrued interest	$	-		$	52,003		$	93,603
Shares issued in connection with stock dividend	$	-		$	-		$	136,713
Stock sold for subscription	$	-		$	397,000		$	464,750
Debt discount recorded on convertible and unsecured debt accounted for as a derivative liability	$	521,289		$	-		$	521,289

See accompanying notes to condensed unaudited financial statements

4

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

NOTE 1             SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION

(A)  Organization and Basis of Presentation

Max Sound Corporation (the "Company") was incorporated in Delaware on December 9, 2005.  The Company is currently in the development stage, and on or around February 2011, the Company changed its business operations to focus primarily on developing and launching audio technology software.

Prior to February 2011, the Company's business operations were focused on creating search technologies within an online networking platform.

The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in The United States of America and the rules and regulations of the Securities and Exchange Commission for interim financial information.  Accordingly, they do not include all the information necessary for a comprehensive presentation of financial position and results of operations.

It is management's opinion, however, that all material adjustments (consisting of normal and recurring adjustments) have been made which are necessary for a fair financial statements presentation.  The results for the interim period are not necessarily indicative of the results to be expected for the year.

Activities during the development stage include developing the online networking platform, launching our audio technology, and raising capital.

Effective March 1, 2011, the Company filed with the State of Delaware a Certificate of Amendment of Certificate of Incorporation changing our name from So Act Network, Inc. to Max Sound Corporation.

(B) Use of Estimates

In preparing financial statements in conformity with generally accepted accounting principles, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reported period.  Actual results could differ from those estimates.

(C) Cash and Cash Equivalents

For purposes of the cash flow statements, the Company considers all highly liquid investments with original maturities of three months or less at the time of purchase to be cash equivalents.  As of June 30, 2012 and December 31, 2011, the Company had no cash equivalents.

5

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

(D) Property and Equipment

Property and equipment are stated at cost, less accumulated depreciation.  Expenditures for maintenance and repairs are charged to expense as incurred.  Depreciation is provided using the straight-line method over the estimated useful life of three to five years.

(E) Research and Development

The Company has adopted the provisions of FASB Accounting Standards Codification No. 350, Intangibles – Goodwill & Other.  Costs incurred in the planning stage of a website are expensed as research and development while costs incurred in the development stage are capitalized and amortized over the life of the asset, estimated to be three years.  Expenses subsequent to the launch have been expensed as website development expenses.

(F) Concentration of Credit Risk

The Company at times has cash in banks in excess of FDIC insurance limits. The Company had approximately $0 and $251,578 in excess of FDIC insurance limits as of June 30, 2012 and December 31, 2011, respectively.

(G) Revenue Recognition

The Company recognized revenue on arrangements in accordance with FASB Codification Topic 605, “Revenue Recognition” (“ASC Topic 605”).  Under ASC Topic 605, revenue is recognized only when the price is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting receivable is reasonably assured.  We had revenue of $0, and $0 for the six months ended June 30, 2012 and 2011, respectively.

(H) Advertising Costs

Advertising costs are expensed as incurred and include the costs of public relations activities.  These costs are included in consulting and general and administrative expenses and totaled $51,069 and $14,120 for the six months ended June 30, 2012 and 2011, respectively.

(I) Identifiable Intangible Assets

As of June 30, 2012 and December 31, 2011, $7,800,275 and $7,800,275, respectively of costs related to registering a trademark and acquiring technology rights have been capitalized.  It has been determined that the trademark and technology rights have an indefinite useful life and are not subject to amortization.  However, the trademark and technology rights will be reviewed for impairment annually or more frequently if impairment indicators arise.

6

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

 

(J) Impairment of Long-Lived Assets

The Company accounts for its long-lived assets in accordance with ASC Topic 360-10-05, “Accounting for the Impairment or Disposal of Long-Lived Assets.” ASC Topic 360-10-05 requires that long-lived assets, such as technology rights, be reviewed for impairment annually, or whenever events or changes in circumstances indicate that the historical cost carrying value of an asset may no longer be appropriate. The Company assesses recoverability of the carrying value of an asset by estimating the future net cash flows expected to result from the asset, including eventual disposition. If the future net cash flows are less than the carrying value of the asset, an impairment loss is recorded equal to the difference between the asset’s carrying value and fair value or disposable value. No impairments were recorded for six months ended June 30, 2012, and for the year ended December 31, 2011.

(K) Loss Per Share

In accordance with accounting guidance now codified as FASB ASC Topic 260, “Earnings per Share,”  Basic earnings per share (“EPS”) is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding during the period, excluding the effects of any potentially dilutive securities. Diluted EPS gives effect to all dilutive potential of shares of common stock outstanding during the period including stock options or warrants, using the treasury stock method (by using the average stock price for the period to determine the number of shares assumed to be purchased from the exercise of stock options or warrants), and convertible debt or convertible preferred stock, using the if-converted method. Diluted EPS excludes all dilutive potential of shares of common stock if their effect is anti-dilutive.  Because of the Company’s net losses, the effects of stock warrants and stock options would be anti-dilutive and accordingly, is excluded from the computation of earnings per share.  The number of such shares excluded from the computations of diluted loss per share totaled 2,915,800 and 1,760,000 for stock warrants, and 12,000,000 and 12,000,000 for stock options, and 3,278,976 and 282,532 shares issuable upon the conversion of convertible debt, for the six months ended June 30, 2012 and 2011, respectively.

(L) Income Taxes

The Company accounts for income taxes under FASB Codification Topic 740-10-25 (“ASC 740-10-25”) Income Taxes.  Under ASC 740-10-25, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases.  Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  Under ASC 740-10-25, 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.

7

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

The Company's federal income tax returns are no longer subject to examination by the IRS for the years prior to 2008, and the related state income tax returns are no longer subject to examination by state authorities for the years prior to 2008.

(M) Business Segments

The Company operates in one segment and therefore segment information is not presented.

(N) Recent Accounting Pronouncements

The Company's management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted would have a material impact on the accompanying financial statements.

(O) Fair Value of Financial Instruments

The carrying amounts on the Company’s financial instruments including prepaid expenses, accounts payable, accrued expenses, derivative liability, convertible note payable, and loan payable-related party, approximate fair value due to the relatively short period to maturity for these instruments.

(P) Stock-Based Compensation

In December 2004, the FASB issued FASB Accounting Standards Codification No. 718, Compensation – Stock Compensation.  Under FASB Accounting Standards Codification No. 718, companies are required to measure the compensation costs of share-based compensation arrangements based on the grant-date fair value and recognize the costs in the financial statements over the period during which employees are required to provide services. Share-based compensation arrangements include stock options, restricted share plans, performance-based awards, share appreciation rights and employee share purchase plans.  As such, compensation cost is measured on the date of grant at their fair value.  Such compensation amounts, if any, are amortized over the respective vesting periods of the option grant.  The Company applies this statement prospectively.

Equity instruments (“instruments”) issued to other than employees are recorded on the basis of the fair value of the instruments, as required by FASB Accounting Standards Codification No. 718.  FASB Accounting Standards Codification No. 505, Equity Based Payments to Non-Employees defines the measurement date and recognition period for such instruments.  In general, the measurement date is when either a (a) performance commitment, as defined, is reached or (b) the earlier of (i) the non-employee performance is complete or (ii) the instruments are vested. The measured value related to the instruments is recognized over a period based on the facts and circumstances of each particular grant as defined in the FASB Accounting Standards Codification.

8

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

(Q) Reclassification

Certain amounts from prior periods have been reclassified to conform to the current period presentation.  These reclassifications had no impact on the Company's net loss or cash flows.

(R) Derivative Financial Instruments

Fair value accounting requires bifurcation of embedded derivative instruments such as conversion features in convertible debt or equity instruments, and measurement of their fair value for accounting purposes.  In determining the appropriate fair value, the Company uses the Black-Scholes option-pricing model.  In assessing the convertible debt instruments, management determines if the convertible debt host instrument is conventional convertible debt and further if there is a beneficial conversion feature requiring measurement.  If the instrument is not considered conventional convertible debt, the Company will continue its evaluation process of these instruments as derivative financial instruments.

Once determined, derivative liabilities are adjusted to reflect fair value at each reporting period end, with any increase or decrease in the fair value being recorded in results of operations as an adjustment to fair value of derivatives.  In addition, the fair value of freestanding derivative instruments such as warrants, are also valued using the Black-Scholes option-pricing model.

NOTE 2             GOING CONCERN

As reflected in the accompanying financial statements, the Company is in the development stage with minimal operations, has an accumulated deficit of $15,794,251 for the period from December 9, 2005 (inception) to June 30, 2012, and has negative cash flow from operations of $2,646,452 from inception.  This raises substantial doubt about its ability to continue as a going concern.  The ability of the Company to continue as a going concern is dependent on the Company’s ability to raise additional capital and implement its business plan.  The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

Management believes that actions presently being taken to obtain additional funding and implement its strategic plans provide the opportunity for the Company to continue as a going concern.

NOTE 3             NOTE PAYABLE – PRINCIPAL STOCKHOLDER

During the year ended December 31, 2008, the Company received $18,803 from the principal stockholder.  Pursuant to the terms of the loan, the loan is bearing an annual interest rate of 3.25% and due on demand.  In 2008, the Company repaid $15,000 in principal to the principal stockholder.  In 2009, the Company repaid $3,803 in principal to the principal stockholder.  As of December 31, 2010, the principal portion of this principal stockholder loan balance has been repaid (See Note 9).

9

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

On May 11, 2009, the Company received $9,500 from the principal stockholder.  During the year ended December 31, 2009, the Company repaid $1,500 in principal to the principal stockholder.  Pursuant to the terms of the loan, the loan is bearing an annual interest rate of 3.25% and is due on demand (See Note 9).

On May 22, 2009, the Company received $15,000 from the principal stockholder.  During the year ended December 31, 2010, the Company repaid $6,000 in principal to the principal stockholder under the terms of the loan.  Pursuant to the terms of the loan, the loan is bearing an annual interest rate of 3.25% and is due on demand (See Note 9).

On May 26, 2009, the Company received $16,700 from the principal stockholder.  During the year ended December 31, 2010, the Company repaid $15,700 in principal to the principal stockholder under the term of this loan.  Pursuant to the terms of the loan, the loan is bearing an annual interest rate of 3.25% and is due on demand (See Note 9).

During the year ended December 31, 2011, the Company repaid $18,000 in principal and $2,116 of accrued interest to the principal stockholder related to these principal stockholder loans (See Note 9).

NOTE 4             LINE OF CREDIT – PRINCIPAL STOCKHOLDER

On May 28, 2009, the Company entered into a two year line of credit agreement with the principal stockholder in the amount of $100,000.  The line of credit carries an interest rate of 3.25%.  As of December 31, 2011, the principal stockholder has advanced the Company $100,000 under the terms of this line of credit agreement (See Note 9).

On November 10, 2009, the Company entered into a two year line of credit agreement with the principal stockholder in the amount of $100,000.  The line of credit carries an interest rate of 3.25%.  As of December 31, 2011, the principal stockholder has advanced $100,000 to the Company under the terms of this line of credit agreement (See Note 9).

On March 25, 2010, the Company entered into a two year line of credit agreement with the principal stockholder in the amount of $500,000.  The line of credit carries an interest rate of 3.25%.  On February 17, 2011, the principal stockholder converted $100,000 of the line of credit owed into 909,091 shares of common stock at $0.11 per share.  As of December 31, 2011, the principal stockholder has advanced $360,580 to the Company under the terms of this line of credit agreement. (See Note 7(G) and Note 9).

As of December 31, 2011, the Company repaid $460,580 in principal and $11,283 of accrued interest to the principal stockholder related to these lines of credit (See Note 9).

10

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

NOTE 5             PROPERTY AND EQUIPMENT

At June 30, 2012, and December 31, 2011, respectively, property and equipment is as follows:

	June 30, 2012			December 31, 2011
Website Development	$	187,723		$	127,722
Furniture and Equipment		103,906			103,906
Leasehold Improvements		6,573			6,573
Software		29,963			18,888
Office Equipment		35,647			9,323
Domain Name		1,500			1,500
Sign		628			628
Less accumulated depreciation and amortization		(144,894	)		(122,540	)
	$	221,046		$	146,000

Depreciation/amortization expense for the six months ended June 30, 2012, and 2011, was $22,354 and $19,136, respectively.

NOTE 6             CONVERTIBLE DEBTS

On July 6, 2010, the Company entered into an agreement whereby the Company will issue up to $50,000 in a convertible note.  The note matured on March 30, 2011, and bears an interest rate of 8%.  Any unpaid amount as of the maturity date bears an interest rate of 22%.  The holder of the note has a right to convert all or any part of the outstanding an unpaid principal amount into shares of common stock.  The conversion prices equals the "Variable Conversion Price", which is 59% of the "Market Price", which is the average of the lowest six trading prices for the Common Stock during the ten (10) trading day period prior to the conversion.  In July of 2010, the Company received $50,000 proceeds less the $3,000 finder’s fee pursuant to the terms of this convertible note.  During the year ended December 31, 2011, the note holder converted $52,003 of the note payable and accrued interest into 1,545,350 shares of the company stock (See Note 7 (G)).

The Company computed the fair value of the conversion feature at the commitment date, based on the following management assumptions:

Exercise price		$0.1377
Expected dividends		0	%
Expected volatility		172.27	%
Expected term: conversion feature	267 days
Risk free interest rate		0.32	%

11

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

The fair value of the embedded conversion option on the commitment date was $15,409.  The Company recorded a related debt discount of $15,409, which was amortized over the life of the debt.  For the year ended December 31, 2010, the Company amortized $10,273 of debt discount.  For the year ended December 31, 2011, the Company amortized $5,136 of debt discount.

At December 31, 2011 the Company remeasured the derivative liability and recorded a fair value of $0.  As a result of the remeasurement, the Company recorded a change in fair value associated with this derivative liability as income totaling $13,262 for the year ended December 31, 2011. The following management assumptions were considered:

Exercise price	$0.0393
Expected dividends	0	%
Expected volatility	471.81	%
Risk fee interest rate	0.30	%
Expected life of conversion feature in days	0

On February 17, 2011, the Company entered into an agreement whereby the Company will issue up to $40,000 in a convertible note.  The note matures on November 17, 2011, and bears an interest rate of 8%.  The holder of the note has a right to convert all or any part of the outstanding an unpaid principal amount into shares of common stock.  The conversion prices equals the "Variable Conversion Price", which is 59% of the "Market Price", which is the average of the lowest six (6) trading prices for the Common Stock during the ten trading day period prior to the conversion.  In February of 2011, the Company received $40,000 proceeds less the $2,500 finder’s fee pursuant to the terms of this convertible note.  During the year ended December 31, 2011, the Company converted $41,600 of the note payable and accrued interest into 289,945 shares of the common stock.

The Company computed the fair value of the conversion feature at the commitment date, based on the following management assumptions:

Exercise price		$0.0738
Expected dividends		0	%
Expected volatility		456.63	%
Expected term: conversion feature	365 days
Risk free interest rate		0.27	%

The fair value of the embedded conversion option on the commitment date was $9,523.  The Company recorded a related debt discount of $9,523, which is amortized over the life of the debt.  For the year ended December 31, 2011, the Company amortized $9,523 of debt discount.

12

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

At December 31, 2011 the Company remeasured the derivative liability and recorded a fair value of $0.  As a result of the remeasurement, the Company recorded a change in fair value associated with this derivative liability as income totaling $9,523 for the year ended December 31, 2011. The following management assumptions were considered:

Exercise price	$0.035
Expected dividends	0	%
Expected volatility	514.06	%
Risk fee interest rate	0.19	%
Expected life of  conversion feature in days	140

On March 8, 2012, the Company entered into an agreement whereby the Company will issue up to $166,667 in a convertible note.  The note matures on March 9, 2013 and bears an interest rate of 4%.  The holder of the note has a right to convert all or any part of the outstanding an unpaid principal amount into shares of common stock after six months.  The conversion price equals the “Variable Conversion Price”, which is 70% of the “Market Price”, which is the average of the lowest ten (10) trading prices for the common stock during the ten trading day period prior to the conversion.  The Company received $150,000 proceeds, less the $16,667 finder’s fee pursuant to the terms of this convertible note, on March 14, 2012.

The Company computed the fair value of the conversion feature at the commitment date, based on the following management assumptions:

Exercise price		$0.2629
Expected dividends		0	%
Expected volatility		228.76	%
Expected term: conversion feature	365 days
Risk free interest rate		0.18	%

The fair value of the embedded conversion option on the commitment date was $42,178.  The Company recorded a related debt discount of $42,178, which is amortized over the life of the debt.  For the six months ended June 30, 2012, the Company amortized $13,058 of debt discount.

At June 30, 2012 the Company remeasured the derivative liability and recorded a fair value of $120,449.  As a result of the remeasurement, the Company recorded a change in fair value associated with this derivative liability as loss totaling $78,271 for the six months ended June 30, 2012. The following management assumptions were considered:

Exercise price	$0.2331
Expected dividends	0	%
Expected volatility	233.04	%
Risk fee interest rate	0.21	%
Expected life of  conversion feature in days	252

13

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

On March 14, 2012, the Company entered into an agreement whereby the Company will issue up to $102,500 in a convertible note.  The note matures on December 19, 2012 and bears an interest rate of 8%.  The holder of the note has a right to convert all or any part of the outstanding an unpaid principal amount into shares of common stock after six months.  The conversion price equals the “Variable Conversion Price”, which is 65% of the “Market Price”, which is the average of the lowest three (3) trading prices for the common stock during the ten trading day period prior to the conversion.  The Company received $102,500 proceeds, less the $2,500 finder’s fee pursuant to the terms of this convertible note, on March 20, 2012.

The Company computed the fair value of the conversion feature at the commitment date, based on the following management assumptions:

Exercise price		$0.1490
Expected dividends		0	%
Expected volatility		228.61	%
Expected term: conversion feature	280 days
Risk free interest rate		0.21	%

The fair value of the embedded conversion option on the commitment date was $30,894.  The Company recorded a related debt discount of $30,894, which is amortized over the life of the debt.  For the six months ended June 30, 2012, the Company amortized $11,806 of debt discount.

At June 30, 2012 the Company remeasured the derivative liability and recorded a fair value of $108,958.  As a result of the remeasurement, the Company recorded a change in fair value associated with this derivative liability as a loss totaling $78,064 for the six months ended June 30, 2012. The following management assumptions were considered:

Exercise price	$0.2080
Expected dividends	0	%
Expected volatility	233.04	%
Risk fee interest rate	0.21	%
Expected life of  conversion feature in days	172

On April 4, 2012, the Company entered into an agreement whereby the Company will issue up to $166,000 in a convertible note.  The note matures on December 28, 2012 and bears an interest rate of 8%.  The holder of the note has a right to convert all or any part of the outstanding an unpaid principal amount into shares of common stock after six months.  The conversion price equals the “Variable Conversion Price”, which is 70% of the “Market Price”, which is the average of the lowest three (3) trading prices for the common stock during the ten trading day period prior to the conversion.  The Company received $138,000 proceeds, less the $28,000 finder’s fee pursuant to the terms of this convertible note, on April 4, 2012.

14

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

The Company computed the fair value of the conversion feature at the commitment date, based on the following management assumptions:

Exercise price		$0.2077
Expected dividends		0	%
Expected volatility		232.90	%
Expected term: conversion feature	268 days
Risk free interest rate		0.19	%

The fair value of the embedded conversion option on the commitment date was $108,051.  The Company recorded a related debt discount of $108,051, which is amortized over the life of the debt.  For the six months ended June 30, 2012, the Company amortized $35,076 of debt discount.

At June 30, 2012, the Company remeasured the derivative liability and recorded a fair value of $162,667.  As a result of the remeasurement, the Company recorded a change in fair value associated with this derivative liability as loss totaling $54,616 for the six months ended June 30, 2012. The following management assumptions were considered:

Exercise price	$0.2240
Expected dividends	0	%
Expected volatility	233.04	%
Risk fee interest rate	0.21	%
Expected life of  conversion feature in days	181

On April 25, 2012, the Company entered into an agreement whereby the Company will issue up to $166,667 in a convertible note.  The note matures on April 25, 2013 and bears an interest rate of 4%.  The holder of the note has a right to convert all or any part of the outstanding an unpaid principal amount into shares of common stock after six months.  The conversion price equals the “Variable Conversion Price”, which is 70% of the “Market Price”, which is the average trading prices for the common stock during the ten trading day period prior to the conversion.  The Company received $150,000 proceeds, less the $16,667 finder’s fee pursuant to the terms of this convertible note, on April 25, 2012.

The Company computed the fair value of the conversion feature at the commitment date, based on the following management assumptions:

Exercise price		$0.1797
Expected dividends		0	%
Expected volatility		240.78	%
Expected term: conversion feature	365 days
Risk free interest rate		0.18	%

The fair value of the embedded conversion option on the commitment date was $255,484.  The Company recorded a related debt discount of $166,667, which is amortized over the life of the debt.  For the six months ended June 30, 2012, the Company amortized $30,137 of debt discount.

15

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

At June 30, 2012 the Company remeasured the derivative liability and recorded a fair value of $187,137.  As a result of the remeasurement, the Company recorded a change in fair value associated with this derivative liability as a gain totaling $68,348 for the six months ended June 30, 2012. The following management assumptions were considered:

Exercise price	$0.2240
Expected dividends	0	%
Expected volatility	233.04	%
Risk fee interest rate	0.21	%
Expected life of  conversion feature in days	299

On May 8, 2012, the Company entered into an agreement whereby the Company will issue up to $333,000 in a convertible note subject to a $33,000 original issue discount (OID).  The note matures on May 8, 2013 and bears an interest rate of 0% if note is repaid on or before 90 days from the effective date. If the note is not repaid within 90 days a one-time interest charge of 5% will be applied to the principal.  As of June 30, 2012, the Company has $111,000 of convertible note as outstanding.  The holder of the note has a right to convert all or any part of the outstanding an unpaid principal amount into shares of common stock after six months.  The conversion price equals the “Variable Conversion Price”, which is 70% of the “Market Price”, which is the average of the lowest three (3) trading prices for the common stock during the fifteen (15) trading day period prior to the conversion. The Company received $92,000 proceeds, less the $8,000 finder’s fee and $11,000 OID pursuant to the terms of this convertible note, on April 25, 2012.

The Company computed the fair value of the conversion feature at the commitment date, based on the following management assumptions:

Exercise price		$0.2030
Expected dividends		0	%
Expected volatility		240.90	%
Expected term: conversion feature	60 days
Risk free interest rate		0.18	%

The fair value of the embedded conversion option on the commitment date was $113,952.  The Company recorded a related debt discount of $111,000, which is amortized over the life of the debt.  For the six months ended June 30, 2012, the Company amortized $98,050 of debt discount.

At June 30, 2012 the Company remeasured the derivative liability and recorded a fair value of $54,946.  As a result of the remeasurement, the Company recorded a change in fair value associated with this derivative liability as a gain totaling $59,006 for the six months ended June 30, 2012. The following management assumptions were considered:

Exercise price	$0.2240
Expected dividends	0	%
Expected volatility	233.04	%
Risk fee interest rate	0.21	%
Expected life of  conversion feature in days	7

16

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

On June 22, 2012, the Company entered into an agreement whereby the Company will issue up to $62,500 in a convertible note.  The note matures on March 27, 2013 and bears an interest rate of 8%. As of June 30, 2012 the Company has $62,500 of convertible note as outstanding.   The holder of the note has a right to convert all or any part of the outstanding an unpaid principal amount into shares of common stock after six months.  The conversion price equals the “Variable Conversion Price”, which is 65% of the “Market Price”, which is the average of the lowest three (3) trading prices for the common stock during the ten trading day period prior to the conversion.   The Company received $60,000 proceeds, less the $2,500 finder’s fee pursuant to the terms of this convertible note, on April 25, 2012.

The Company computed the fair value of the conversion feature at the commitment date, based on the following management assumptions:

Exercise price		$0.1647
Expected dividends		0	%
Expected volatility		234.89	%
Expected term: conversion feature	278 days
Risk free interest rate		0.19	%

The fair value of the embedded conversion option on the commitment date was $78,435.  The Company recorded a related debt discount of $62,500, which is amortized over the life of the debt.  For the six months ended June 30, 2012, the Company amortized $1,798 of debt discount.

At June 30, 2012 the Company remeasured the derivative liability and recorded a fair value of $74,626.  As a result of the remeasurement, the Company recorded a change in fair value associated with this derivative liability as a gain totaling $3,809 for the six months ended June 30, 2012. The following management assumptions were considered:

Exercise price	$0.2240
Expected dividends	0	%
Expected volatility	233.04	%
Risk fee interest rate	0.21	%
Expected life of conversion feature  in days	270

17

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

NOTE 7             STOCKHOLDERS’ EQUITY

(A) Common Stock Issued for Cash

On December 31, 2005, the Company issued 100,000 shares of common stock for cash of $100 in exchange for acceptance of the incorporation expenses for the Company ($0.001/share).   As a result of the forward split, the 100,000 shares were increased to 400,000 shares ($0.00025/share) (See Note 7(D)).

For the year ended December 31, 2008, the Company issued 473,000 shares of common stock for cash of $118,250 ($0.25/share), of which $67,750 was a subscription receivable.   During the month of January 2009, $67,750 of stock subscription receivable was collected.  As a result of the forward split, the 473,000 shares were increased to 1,892,000 shares ($0.0625/share). (See Note 7(D)).

On January 2, 2009, the Company entered into stock purchase agreements to issue 20,000 shares of common stock for cash of $5,000 ($0.25/share).   As a result of the forward split, the 20,000 shares were increased to 80,000 shares ($0.0625/share) (See Note 7(D)).

On January 3, 2009, the Company entered into stock purchase agreements to issue 2,000 shares of common stock for cash of $500 ($0.25/share).  As a result of the forward split, the 2,000 shares were increased to 8,000 shares ($0.0625/share) (See Note 7(D)).

On January 3, 2009, the Company entered into stock purchase agreements to issue 2,000 shares of common stock for cash of $500 ($0.25/share).  As a result of the forward split, the 2,000 shares were increased to 8,000 shares ($0.0625/share) (See Note 7(D)).

On January 11, 2009, the Company entered into stock purchase agreements to issue 32,000 shares of common stock for cash of $8,000 ($0.25/share).  As a result of the forward split, the 32,000 shares were increased to 128,000 shares ($0.0625/share) (See Note 7(D)).

On January 12, 2009, the Company entered into stock purchase agreements to issue 2,000 shares of common stock for cash of $500 ($0.25/share).   As a result of the forward split, the 2,000 shares were increased to 8,000 shares ($0.0625/share) (See Note 7(D)).

On January 15, 2009, the Company entered into stock purchase agreements to issue 4,000 shares of common stock for cash of $1,000 ($0.25/share).  As a result of the forward split, the 4,000 shares were increased to 16,000 shares ($0.0625/share) (See Note 7(D)).

In February of 2009, the Company paid direct offering costs of $850 related to the securities sold.

On May 27, 2010 the Company issued one unit; each unit consisted of 100,000 shares of common stock and 100,000 warrants to purchase common stock, for cash of $22,500 net of the $2,500 finder’s fee ($0.25/share).  Each warrant is exercisable for a three year period and has an exercise price of $0.50 per share (See Note 7(C)).

18

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

On July 23, 2010, the Company issued one unit; each unit consisted of 100,000 shares of common stock and 100,000 warrants to purchase common stock, for cash of $25,000 ($0.25/share).  Each warrant is exercisable for a three year period and has an exercise price of $0.50 per share (See Note 7(C).

On August 5, 2010, the Company issued 10 units; each unit consisted of 100,000 shares of common stock and 100,000 warrants to purchase common stock, for cash of $250,000 ($0.25/share).  Each warrant is exercisable for a three year period and has an exercise price of $0.50 per share (See Note 7(C).

During the year ended December 31, 2010, the Company paid direct offering costs of $2,900 related to the securities sold.

On January 24, 2011, the Company issued 10,000 shares of common stock for cash of $1,000 ($0.10/share).

On February 23, 2011, the Company issued 300,000 shares of common stock for cash of $30,000 ($0.10/share).

On March 21, 2011, the Company issued 150,000 shares of common stock for cash of $15,000 ($0.10/share).

On May 2, 2011, the Company issued 2,000,000 shares of common stock for cash of $200,000 ($0.10/share).

During the month of June 2011, the Company issued 5,460,000 shares of common stock for cash of $546,000 ($0.10/share) of which $397,000 was a subscription receivable.  The Company received the entire $397,000 of subscription receivable in July 2011.

During the months of July, August and September of 2011, the Company issued 10,937,000 shares of common stock for cash of $1,093,700 ($0.10/share).

During the year-ended December 31, 2011, the Company paid $76,780 in finder’s fees and issued 955,800 warrants (See Note 7(C)).

(B) Stock Issued for Services

On October 14, 2008, the Company issued 44,900,000 shares of common stock to its founder having a fair value of $44,900 ($0.001/share) in exchange for services provided.  As a result of the forward split, the 44,900,000 shares were increased to 179,600,000 shares and its purchase price was similarly adjusted to $0.00025((See Note 7(D) and Note 9).

19

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

On November 24, 2008, the Company issued 4,000 shares of common stock having a fair value of $1,000 ($0.25/share) in exchange for consulting services.  As a result of the forward split, the 4,000 shares were increased to 16,000 shares and its purchase price was similarly adjusted to $0.0625/share (See Note 7(D)).

On December 5, 2008, the Company issued 4,000 shares of common stock having a fair value of $1,000 ($0.25/share) in exchange for consulting services.  As a result of the forward split, the 4,000 shares were increased to 16,000 shares and its purchase price was similarly adjusted to $0.0625/share (See Note 7(D)).

On December 20, 2008, the Company issued 4,000 shares of common stock having a fair value of $1,000 ($0.25/share) in exchange for consulting services.  As a result of the forward split, the 4,000 shares were increased to 16,000 shares and its purchase price was similarly adjusted to $0.0625/share (See Note 7(D)).

On January 12, 2009, the Company issued 4,000 shares of common stock having a fair value of $1,000 ($0.25/share) in exchange for consulting services.  As a result of the forward split, the 4,000 shares were increased to 16,000 shares and its purchase price was similarly adjusted to $0.0625/share (See Note 7(D)).

On January 14, 2009, the Company issued 20,000 shares of common stock having a fair value of $5,000 ($0.25/share) in exchange for services related to a development services agreement entered on January 19, 2009.  As a result of the forward split, the 20,000 shares were increased to 80,000 shares and its purchase price was similarly adjusted to $0.0625/share (See Note 7(D) and Note 8(B)).

On August 25, 2009, the Company issued 50,000 shares of common stock having a fair value of $3,125 ($0.0625/share), based upon the fair value on the date of grant, in exchange for professional services.

On August 31, 2009, the Company issued 885,714 shares of common stock in exchange for services valued at $62,000 related to the development services agreement entered into on January 19, 2009.  Based on the most recent fair market value at that time, the shares were valued at $55,357 ($0.0625/share), resulting in the recognition of a gain on the extinguishment of debt of $6,643 (See Note 8(B)).

On September 18, 2009, the Company issued 500,000 shares of common stock as compensation pursuant to the terms of a consulting agreement, having a fair value of $175,000 ($0.35/share) based upon fair value on the date of grant.  On November 11, 2009, the Company cancelled the agreement and 300,000 shares of common stock were returned to the Company. As of December 31, 2009, $70,000 is recorded as consulting expense and $105,000 of deferred compensation was reclassified to $0 (See Note 8(B)).

On September 18, 2009, the Company issued 600,000 shares of common stock as compensation pursuant to the terms of a consulting agreement, having a fair value of $210,000 ($0.35/share) based upon fair value on the date of grant.  On November 18, 2009, the Company cancelled the agreement and 400,000 shares of common stock were returned to the Company.  As of December 31, 2009, $70,000 is recorded as consulting expense and $140,000 of deferred compensation was reclassified to $0 (See Note 8(B)).

20

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

On September 21, 2009, the Company issued 600,000 shares of common stock as compensation pursuant to the terms of a consulting agreement, having a fair value of $210,000 ($0.35/share) based upon fair value on the date of grant.  On December 18, 2009, the Company terminated the consulting agreement and 400,000 shares were returned to the Company.  As of December 31, 2009, $70,000 is recorded as consulting expense and $140,000 of deferred compensation was reclassified to $0 (See Note 8(B)).

On November 12, 2009, the Company issued 100,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $178,000 ($1.78/share) based upon fair value on the date of grant.  During 2009 and 2010, $11,948 and $89,000 was recorded as consulting expense, respectively.  For the year ended December 31, 2011, $77,052 is recorded as consulting expense and $0 is recorded as deferred compensation (See Note 8(B)).

On November 12, 2009, the Company issued 200,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $400,000 ($2.00/share) based upon fair value on the date of grant.  During 2009 and 2010, $22,466 and $200,000 was recorded as consulting expense, respectively.  For the year ended December 31, 2011, $177,534 is recorded as consulting expense and $0 is recorded as deferred compensation (See Note 8(B)).

On November 16, 2009, the Company issued 100,000 shares of common stock as compensation pursuant to the terms of the consulting agreements, having a fair value of $180,000 ($1.80/share) based upon fair value on the date of grant.  During 2009 and 2010, $11,096 and $90,000 was recorded as consulting expense, respectively.  For the year ended December 31, 2011, $78,904 is recorded as consulting expense and $0 is recorded as deferred compensation (See Note 8(B)).

On November 18, 2009, the Company issued 30,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $45,000 ($1.50/share) based upon fair value on the date of grant.  During 2009, $5,301 was recorded as consulting expense.  For the year ended December 31, 2010, $39,699 was recorded as consulting expense. (See Note 8(B)).

On November 21, 2009, the Company issued 30,000 shares of common stock as compensation pursuant to the terms of the marketing agreement, having a fair value of $53,100 ($1.77/share) based upon fair value on the date of grant.  For the year ended December 31, 2010, $53,100 was recorded as consulting expense (See Note 8(B)).

21

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

On December 3, 2009, the Company issued 240,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $468,000 ($1.95/share) based upon fair value on the date of grant.  As of December 31, 2009, $468,000 was recorded as consulting expense (See Note 8(B)).

On December 3, 2009, the Company issued 35,000 shares of common stock as compensation pursuant to the terms of the commission agreement, having a fair value of $68,250 ($1.95/share) based upon fair value on the date of grant.  As of December 31, 2009, $68,250 was recorded as consulting expense (See Note 8(B)).

On December 3, 2009, the Company issued 35,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $68,250 ($1.95/share) based upon fair value on the date of grant.  As of December 31, 2009, $68,250 was recorded as consulting expense (Note 8(B)).

On December 3, 2009, the Company issued 10,000 shares of common stock as compensation pursuant to the terms of the commission agreement, having a fair value of $19,500 ($1.95/share) based upon fair value on the date of grant.  As of December 31, 2009, $19,500 is recorded as consulting expense (See Note 8(B)).

On December 15, 2009, the Company issued 100,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $200,000 ($2.00/share) based upon fair value on the date of grant.  During 2009, $71,111 was recorded as consulting expense.  For the year ended December 31, 2010, $128,889 was recorded as consulting expense (See Note 8(B)).

On December 27, 2009, the Company issued 10,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $19,400 ($1.94/share) based upon fair value on the date of grant.  For the year ended December 31, 2010, $19,400 was recorded as consulting expense (See Note 8(B)).

On December 27, 2009, the Company issued 10,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $19,400 ($1.94/share) based upon fair value on the date of grant.  For the year ended December 31, 2010, $19,400 was recorded as consulting expense (See Note 8(B)).

On December 27, 2009, the Company issued 10,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $19,400 ($1.94/share) based upon fair value on the date of grant.  For the year ended December 31, 2010, $19,400 was recorded as consulting expense (See Note 8(B)).

On December 30, 2009, the Company issued 1,500,000 shares of common stock as compensation pursuant to the terms of the advertising agreement, having a fair value of $2,895,000 ($1.93/share) based upon fair value on the date of grant.  In 2010, the Company cancelled a portion of the agreement and as a result, 1,000,000 shares of common stock were returned to the Company.  For the year ended December 31, 2010, $965,000 was recorded as consulting expense (See Note 8(B)).

22

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

On December 31, 2009, the Company issued 75,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $144,750 ($1.93/share) based upon fair value on the date of grant.  For the year ended December 31, 2010, $116,374 was recorded as consulting expense.  For the year ended December 31, 2011, $28,376 is recorded as consulting expense (See Note 8(B)).

On December 31, 2009, the Company issued 75,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $144,750 ($1.93/share) based upon fair value on the date of grant.  For the year ended December 31, 2010, $116,374 was recorded as consulting expense.  For the year ended December 31, 2011, $28,376 is recorded as consulting expense (See Note 8(B)).

On December 31, 2009, the Company issued 500,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $965,000 ($1.93/share) based upon fair value on the date of grant.  For the year ended December 31, 2010, $965,000 was recorded as consulting expense (See Note 8(B)).

During December of 2009, the Company issued 680,000 shares of common stock as compensation pursuant to the terms of the consulting agreements, having a fair value of $1,312,400 ($1.93/share) based upon fair value on the date of grant.  During 2009 and 2010, $2,802 and $709,116 was recorded as consulting expense, respectively.  For the year ended December 31, 2011, $600,482 is recorded as consulting expense and $0 is recorded as deferred compensation (See Note 8(B)).

During December of 2009, the Company issued 600,000 shares of common stock as compensation pursuant to the terms of the consulting agreements, having a fair value of $1,170,000 ($1.95/share) based upon fair value on the date of grant.  During 2009 and 2010, $34,192 and $585,000 was recorded as consulting expense, respectively.  For the year ended December 31, 2011, $550,808 is recorded as consulting expense and $0 is recorded as deferred compensation (See Note 8(B)).

On January 15, 2010, the Company issued 100,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $170,000 ($1.70/share) based upon fair value on the date of grant.  For the year ended December 31, 2010, $81,507 was recorded as consulting expense.  For the year ended December 31, 2011, $88,493 is recorded as consulting expense and $0 is recorded as deferred compensation (See Note 8(B)).

On February 17, 2010, the Company entered into a twelve month consulting agreement with an unrelated third party effective February 17, 2010.  In exchange for the services provided, the Company issued 1,000,000 shares of common stock having a fair value of $1,240,000 ($1.24/share) based upon fair value on the date of grant.  For the year ended December 31, 2010, $1,066,740 was recorded as consulting expense.  For the year ended December 31, 2011, $173,260 is recorded as consulting expense (See Note 8(B)).

23

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

On June 1, 2010, the Company entered into a twelve month consulting agreement for consulting and business services.  As part of the agreement, the Company issued 40,000 shares as a nonrefundable retainer fee having a value of $10,000 ($0.25/share) based upon fair value on the date of the agreement.  (See Note 8(B)).

On July 23, 2010, the Company issued 10,000 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $2,000 ($0.20/share) based upon fair value on the grant date (See Note 8(B)).

On August 1, 2010, the Company issued 200,000 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $40,000 ($0.20/share) based upon fair value on the grant date (See Note 8(B)).

On September 1, 2010, the Company issued 100,000 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $19,000 ($0.19/share) based upon fair value on the grant date (See Note 8(B)).

On October 1, 2010, the Company issued 100,000 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $18,000 ($0.18/share) based upon fair value on the grant date (See Note 8(B)).

On November 1, 2010, the Company issued 100,000 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $25,000 ($0.25/share) based upon fair value on the grant date (See Note 8(B)).

On December 14, 2010, the Company issued 250,000 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $37,500 ($0.15/share) based upon fair value on the grant date (See Note 8(B)).

On January 17, 2011, the Company issued 3,000,000 shares of common stock to its' new CEO pursuant to an employment agreement having a fair value of $300,000 ($0.10/share) based upon fair value on the grant date.  (See Note 8(A)).

On February 17, 2011, the Company issued 500,000 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $55,000 ($0.11/share) based upon fair value on the grant date (See Note 8(B)).

On March 3, 2011, the Company issued 1,000,000 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $80,000 ($0.08/share) based upon fair value on the grant date (See Note 8(B)).

24

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

On May 17, 2011, the Company issued 2,000,000 shares of common stock pursuant to an employment agreement having a fair value of $140,000 ($0.07/share) based upon fair value on the grant date.  (See Note 8(A)).

During June 2011, the Company issued 300,000 shares of common stock pursuant to  consulting agreements for consulting services having a fair value of $75,000 ($0.25/share) based upon fair value on the grant date (See Note 8(B)).

On June 15, 2011, the Company issued 15,980 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $1,598 ($0.10/share) based upon the terms of the consulting agreement (See Note 8(B)).

On July 1, 2011, the Company issued 6,500 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $520 ($0.08/share) based upon the terms of the consulting agreement (See Note 8(B)).

On August 14, 2011, the Company issued 2,443 shares of common stock pursuant to two consulting agreements for consulting services having a fair value of $855 ($0.35/share) based upon the terms of the consulting agreements (See Note 8(B)).

On September 12, 2011, the Company issued 2,860 shares of common stock pursuant to two consulting agreements for consulting services having a fair value of $715 ($0.25/share) based upon the terms of the consulting agreements (See Note 8(B)).

On September 18, 2011, the Company issued 15,403 shares of common stock pursuant to two consulting agreements for consulting services having a fair value of $3,388 ($0.22/share) based upon the terms of the consulting agreements (See Note 8(B)).

On September 25, 2011, the Company issued 1,500 shares of common stock pursuant to two consulting agreements for consulting services having a fair value of $585 ($0.39/share) based upon the terms of the consulting agreements (See Note 8(B)).

During the three months ended September 30, 2011, the Company issued 50,482 shares of common stock pursuant to two consulting agreements for consulting services having a fair value of $5,048 ($0.10/share) based upon the terms of the consulting agreements (See Note 8(B)).

On September 19, 2011, the Company issued 100,000 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $23,000 ($0.23/share) based upon the terms of the consulting agreement (See Note 8(B)).

On September 21, 2011, the Company issued 400,000 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $100,000 ($0.25/share) based upon the terms of the consulting agreement (See Note 8(B)).

25

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

On September 24, 2011, the Company issued 100,000 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $33,000 ($0.33/share) based upon the terms of the consulting agreement (See Note 8(B)).

On September 27, 2011, the Company issued 100,000 shares of common stock pursuant to two consulting agreements for consulting services having a fair value of $39,000 ($0.22/share) based upon the terms of the consulting agreements (See Note 8(B)).

During October 2011, the Company issued 123,795 shares of common stock for services having a fair value of $58,184 ($0.47/share).

On October 28, 2011, the Company issued 100,000 shares of common stock for consulting services having a fair value of $88,000 ($0.88/share).

On November 18, 2011, the Company issued 100,000 shares of common stock for consulting services having a fair value of $70,000 ($0.70/share).

During December 2011, the Company issued 200,000 shares of common stock for services having a fair value of $108,000 ($0.54/share).

On December 18, 2011, the Company issued 100,000 shares of common stock for consulting services having a fair value of $50,000 ($0.50/share).

On January 25, 2012 the Company issued 733 shares of common stock pursuant to two consulting agreements for consulting services having a fair value of $455 ($0.62/share) based upon the terms of the consulting agreements (See Note 8(B)).

On March 14, 2012, the Company entered into a settlement agreement with a former employee with relation to the restriction on shares owned by the former employee.  The settlement agreement will lift the restriction on his 6 million shares, and thus agreed to allow the former employee to sell 250,000 of the Company stock per quarter for two years.  In addition, the Company settled a dispute over the termination of the employment agreement by agreeing to give the former employee an additional 150,000 shares to eliminate any dispute over anything owed under his old employment agreement.  He is not an affiliate, not an insider and not a 5% or greater shareholder.  For the six months ended June 30, 2012, the Company issued 150,000 shares of common stock for consulting services having a fair value of $31,500 ($0.21/share), in relation to this settlement agreement.

(C) Common Stock Warrants

On December 30, 2009, the Company issued 500,000 warrants under a consulting agreement. The Company recognized an expense of $823,077 for the year ended December 31, 2009.  The Company recorded the fair value of the warrants  based on the fair value of each warrant grant estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions used for grants in 2009, dividend yield of zero, expected volatility of 112.80%; risk-free interest rates of 1.65%, expected life of three years. The warrants vested immediately.   The warrants expire in three years from the date of issuance and have an exercise price of $0.52 per share.

26

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

On May 27, 2010, the Company issued 10,000 warrants under a consulting agreement. The Company recognized an expense of $1,782 for the year ended December 31, 2010.  The Company recorded the fair value of the warrants  based on the fair value of each warrant grant estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions used for grants in 2010, dividend yield of zero, expected volatility of 152.80%; risk-free interest rates of 1.35%, expected life of three years. The warrants vested immediately.   The warrants expire in three years from the date of issuance and have an exercise price of $0.50 per share (See Note 8(B)).

On June 1, 2010, the Company issued 40,000 warrants under a consulting agreement. The Company recognized an expense of $7,184 for the year ended December 31, 2010.  The Company recorded the fair value of the warrants  based on the fair value of each warrant grant estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions used for grants in 2010, dividend yield of zero, expected volatility of 145.70%; risk-free interest rates of 1.26%, expected life of three years.  The warrants vested immediately.  The warrants expire in three years from the date of issuance and have an exercise price of $0.50 per share (See Note 8(B)).

On July 23, 2010, the Company issued 10,000 warrants under a consulting agreement. The Company recognized an expense of $1,593 for the year ended December 31, 2010.  The Company recorded the fair value of the warrants  based on the fair value of each warrant grant estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions used for grants in 2010, dividend yield of zero, expected volatility of 172.90%; risk-free interest rates of 0.94%, expected life of three years. The warrants vested immediately.   The warrants expire in three years from the date of issuance and have an exercise price of $0.50 per share (See Note 8(B)).

During the year ended December 31, 2010, the Company issued 1,200,000 warrants in conjunction with the sale of the Company stock (See Note 7(A)).

On September 2, 2011, the Company issued 955,800 warrants under consulting agreements. The Company recognized an expense of $248,498 for the year ended December 31, 2011.  The Company recorded the fair value of the warrants  based on the fair value of each warrant grant estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions used for grants in 2011, dividend yield of zero, expected volatility of 461.11%; risk-free interest rates of 0.33%, expected life of three years. The warrants vested immediately.   The warrants expire in three years from the date of issuance and have an exercise price of $0.10 per share (See Note 8(B)).

27

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

On June 11, 2012, the Company issued 200,000 warrants under consulting agreements. The Company recognized an expense of $48,031 for the six months ended June 30, 2012.  The Company recorded the fair value of the warrants  based on the fair value of each warrant grant estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions used for grants in 2012, dividend yield of zero, expected volatility of 237.76%; risk-free interest rates of 0.19%, expected life of three years. The warrants vested immediately.   The warrants expire in three years from the date of issuance and have an exercise price of $0.25 per share (See Note 8(B)).

The following tables summarize all warrant grants as of June 30, 2012 and June 30, 2011, and the related changes during these periods are presented below:

	Number of Warrants		Weighted Average Exercise Price
Stock Warrants
Balance at December 31, 2010		1,760,000	$	0.51
Granted		955,800		0.10
Exercised
Forfeited
Balance at December 31, 2011		2,715,800	$	0.36
Granted		200,000	$	0.25
Exercised		-
Forfeited		-
Balance at June 30, 2012		2,915,800	$	0.36
Options Exercisable at June 30, 2012		2,915,800	$	0.36
Weighted Average Fair Value of Options Granted			$	0.36

Warrants Outstanding								Warrants Exercisable
Range of Exercise Price		Number Outstanding at June 30, 2012		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price		Number Exercisable at June 30, 2012		Weighted Average Exercise Price
$	0.52		500,000		0.50	$	0.52		500,000	$	0.52
$	0.50		1,260,000		0.85	$	0.50		1,260,000	$	0.50
$	0.10		955,800		2.17	$	0.10		955,800	$	0.10
$	0.25		200,000		2.95	$	0.25		200,000	$	0.25

28

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

 

Warrants Outstanding								Warrants Exercisable
Range of Exercise Price		Number Outstanding at June 30, 2011		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price		Number Exercisable at June 30, 2011		Weighted Average Exercise Price
$	0.52		500,000		1.50	$	0.52		500,000	$	0.52
$	0.50		1,260,000		1.99	$	0.50		1,260,000	$	0.50

In connection with the warrants issued for cash and services, the Company has an aggregate of 2,915,800 and 1,760,000 warrants outstanding as of June 30, 2012 and 2011, respectively.  As of June 30, 2012, the Company has reserved 2,915,800 shares of common stock for the future exercise of the warrants.

(D) Stock Split Effected in the Form of a Stock Dividend

On January 16, 2009, the Company's Board of Directors declared a four-for-one stock split to be effected in the form of a stock dividend.  The stock split was distributed on January 16, 2009 to shareholders of record.  A total of 136,713,000 shares of common stock were issued.  All basic and diluted loss per share and average shares outstanding information has been adjusted to reflect the aforementioned stock dividend.

(E) Amendment to Articles of Incorporation

On January 27, 2009, the Company amended its Articles of Incorporation to provide for an increase in its authorized share capital. The authorized capital stock increased to 250,000,000 common shares at a par value of $0.001 per share, and 10,000,000 preferred shares at a par value of $0.001 with class and series designations, voting rights, and relative rights and preferences to be determined by the Board of Directors of the Company from time to time.

On June 2, 2010, the Company amended its Articles of Incorporation to provide for an increase in its authorized share capital. The authorized capital stock increased to 295,000,000 common shares at a par value of $0.001 per share.

On September 20, 2010, the Company amended its Articles of Incorporation to provide for an increase in its authorized share capital and a change in the par value per share. The authorized capital stock increased to 400,000,000 common shares at a par value of $0.0001 per share.

Effective March 1, 2011, the Company filed with the State of Delaware a Certificate of Amendment of Certificate of Incorporation changing our name from So Act Network, Inc. to Max Sound Corporation.

29

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

(F) In Kind Contribution

During the fourth quarter of 2008, a former stockholder of the Company paid $4,400 of operating expenses on behalf of the Company.

During the fourth quarter of 2008, the principal stockholder contributed office space with a fair market value of $2,913 (See Note 9).

For the year ended December 31, 2009, the principal stockholder contributed office space with a fair market value of $12,600 (See Note 9).

For the year ended December 31, 2010, the principal stockholder contributed office space with a fair value of $9,450 (See Note 9).

(G) Share Conversion

On June 2, 2010, a principal stockholder converted $283,652 of accrued compensation into 945,507 shares of common stock at $0.30 per share (See Note 9).

On February 17, 2011, a principal stockholder converted $144,000 of accrued compensation into 1,309,091 shares of common stock at $0.11 per share (See Note 9).

On February 17, 2011, a principal stockholder converted $100,000 of a line of credit owed into 909,091 shares of common stock at $.011 per share (See Note 4 and Note 9).

On January 18, 2011, the Company entered into a conversion agreement executed by a note holder for 109,375 shares based on a conversion price of $0.032 per share (See Note 6).

On February 9, 2011, the Company entered into a conversion agreement executed by a note holder for 271,186 shares based on a conversion price of $0.0295 per share (See Note 6).

On February 15, 2011, the Company entered into a conversion agreement executed by a note holder for 357,143 shares based on a conversion price of $0.0336 per share (See Note 6).

On February 23, 2011, the Company entered into a conversion agreement executed by a note holder for 220,264 shares based on a conversion price of $0.0454 per share (See Note 6).

On April 11, 2011, the Company entered into a conversion agreement executed by a note holder for 587,382 shares based on a conversion price of $0.0315 per share (See Note 6).

On August 25, 2011, the Company entered into a conversion agreement executed by a note holder for 77,220 shares based on a conversion price of $0.1554 per share (See Note 6).

30

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

On August 30, 2011, the Company entered into a conversion agreement executed by a note holder for 96,220 shares based on a conversion price of $0.1455 per share (See Note 6).

On September 12, 2011, the Company entered into a conversion agreement executed by a note holder for 116,505 shares based on a conversion price of $0.1339 per share (See Note 6).

(H) Share Exchange

On May 11, 2010, the Company acquired the rights to an audio technology known as Max Audio Technology (Max) through a share exchange, whereby the Company issued 30,000,000 shares of common stock to two individuals in exchange for their rights in Max having a value of $7,500,000 based upon recent market value ($0.25/share) (See Note 8(B)).

On January 17, 2011, the Company acquired the rights to software technology known as Blog Software, Social Media Vault, Social Media Bar and Trending Topix (BSST) through a share exchange, whereby the Company issued 3,000,000 shares of common stock to two individuals in exchange for their rights to BSST having a value of $300,000 based upon recent market value ($0.10/share).

(I) Stock Options

On January 17, 2011, the Company issued 12,000,000 options to buy common shares of the Company's stock at $0.12 per share, good for three years, to its' new CEO pursuant to an employment agreement.  The Company recognized an expense of $1,199,794 for the year ended December 31, 2011.  The Company recorded the fair value of the options  based on the fair value of each option grant estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions used for grants in 2010; dividend yield of zero, expected volatility of 436.04%, risk-free interest rates of 1.00%, expected life of three years.  The options vest immediately (See Note 8 (A)).

31

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

The following tables summarize all warrant grants as of June 30, 2012 and June 30, 2011, and the related changes during these periods are presented below:

	Number of Options		Weighted Average Exercise Price
Stock Options
Balance at December 31, 2011		12,000,000	$	0.12
Granted		-	$	-
Exercised		-
Forfeited		-
Balance at June 30, 2012		12,000,000	$	0.12
Options Exercisable at June 30, 2012		12,000,000	$	0.12
Weighted Average Fair Value of Options Granted			$	0.12

Options Outstanding								Options Exercisable
Range of Exercise Price		Number Outstanding at June 30, 2012		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price		Number Exercisable at June 30, 2012		Weighted Average Exercise Price
$	0.12		12,000,000		1.55	$	0.12		12,000,000	$	0.12

Options Outstanding								Options Exercisable
Range of Exercise Price		Number Outstanding at June 30, 2011		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price		Number Exercisable at June 30, 2011		Weighted Average Exercise Price
$	-		-		-	$	-		-	$	-

In connection with the options issued for cash and services, the Company has an aggregate of 12,000,000 and 0 options outstanding as of June 30, 2012 and 2011, respectively.  As of June 30, 2012, the Company has reserved 12,000,000 shares of common stock for the future exercise of the options.

32

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

NOTE 8             COMMITMENTS

(A)  Employment Agreement

On October 13, 2008, the Company executed an employment agreement with its President and CEO.  The term of the agreement is for ten years.  As compensation for services, the President will receive a monthly compensation of $18,000 beginning October 13, 2008.  In addition, to the base salary, the employee is entitled to receive a 10% commission of all sales of the Corporation.  The agreement also calls for the employee to receive health benefits.  For the six months ended June 30, 2012, the Company has recorded $108,000 in compensation expense (See Note 9).

On January 17, 2011, the Company executed an employment agreement with an executive to be CEO for five years.  As compensation for services, the executive will receive a monthly compensation of $8,000 beginning after the completion of at least one million dollars of new funding to the Corporation or can be paid as commissions from sales brought to the Company, whichever comes first. In addition to the base salary, the employee is entitled to receive a 20% commission of all sales the executive is directly responsible for bringing to the Company.  The agreement also calls for the executive to receive, upon execution of the agreement, three million shares of Rule 144 common stock and twelve million options, which are good for three years, to buy shares of Rule 144 common stock at $0.12/share.  As a supplement to the agreement, on February 4, 2011, the executive shall receive an additional twenty million common shares directly from the President of the Company.  On August 25, 2011, the agreement was updated to increase the monthly compensation to $12,000 per month beginning September 1, 2011, terminate the initial 20% commission on sales and to add a commission on sales equal to 10% of gross quarterly profits.  The agreement also calls for the employee to receive health benefits (See Note 7(B) and 7(I)).

On May 17, 2011, the Company executed an employment agreement with its Chief Internet Officer (“CIO”).  The term of the agreement is for five years.  As compensation for services, the CIO will receive a monthly compensation of $9,000 beginning at the completion of at least one million dollars of new funding.  In addition to the base salary, the employee is entitled to receive health benefits.  The agreement also calls for the CIO to receive two million shares of Rule 144 common stock upon the execution of the agreement.  On August 25, 2011, the agreement was updated to increase the monthly compensation to $12,000 per month beginning October 1, 2011.  (See Note 7(B)).

On October 1, 2011, the Company executed an employment agreement with its Chief Technical Officer (“CTO”).  The term of the agreement is for five years.  As compensation for services, the CTO will receive a monthly compensation of $10,000, monthly commission equal to 5% of all profits derived from the sales of all products and services related to Max Sound, and an annual bonus of 5% of all profits derived from the sales of all products and services related to Max Sound that is over one million dollars.  In addition to the base salary, the employee is entitled to receive health benefits.  Effective January 1, 2012, the Company increased the monthly compensation to $12,000.

33

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

On June 11, 2012, the Company executed an employment agreement with its Senior Audio Engineer.  The term of the agreement is for five years.  As compensation for services, the Engineer will receive a monthly compensation of $6,000 beginning July 1, 2012.  In addition to the base salary, the employee is entitled to receive health benefits, and the employee will receive 1,000,000 shares of common stock payable in 125,000 increments per quarter beginning on July 1, 2012.

(B)   Consulting Agreement

On January 19, 2009, the Company entered into a development services agreement to construct social network software for a fee of $150 and $375 an hour.  The contract will remain in place until either party desires to cancel.  A retainer fee of $20,000 has been paid upon the execution of the agreement and will be used towards the services provided.  In addition, on January 14, 2009 the Company issued 20,000 shares in exchange for services valued at $5,000 ($0.25/share).  As a result of the forward split, the 20,000 shares were increased to 80,000 shares and its purchase price was similarly adjusted to $0.0625 (See Note 7(B) and Note 7(D)).  On May 29, 2009 the Company amended the consulting agreement by reducing the hourly rate to $75 an hour and reducing the outstanding balance due by $17,163. On August 31, 2009, the Company issued 885,714 shares of common stock in exchange for services valued at $62,000 related to the development services agreement entered into on January 19, 2009.  Based on the most recent fair market value at that time, the shares were valued at $55,357 ($0.0625/share), resulting in the recognition of a gain on the extinguishment of debt of $6,643 (See Note 7(B)).

On January 20, 2009, the Company entered into a service agreement with a transfer agent to become the Company's transfer agent for the purpose of maintaining stock ownership and transfer records for the Company.

On September 17, 2009, the Company entered into a six month consulting agreement with an unrelated third party to provide public relations services.  In exchange for the services provided, on September 18, 2009 the Company issued 500,000 shares of common stock having a fair value of $175,000 ($0.35/share) based upon fair value on the date of grant.  The Company has an option to cancel the contract during the first ninety days of the agreement and 200,000 shares will be returned back to the Company.  On November 11, 2009, the Company cancelled the agreement and 300,000 shares of common stock were returned to the Company.   As of December 31, 2009, $70,000 is recorded as consulting expense and $105,000 of deferred compensation was reclassified to $0 (See Note 7(B)).

On September 18, 2009, the Company entered into a six month consulting agreement with an unrelated third party to provide public relations services.  In exchange for the services provided the Company issued 600,000 shares of common stock having a fair value of $210,000 ($0.35/share) based upon fair value on the date of grant.  Shares will be issued on or before December 18, 2009 in six 100,000 increments.  The Company has an option to cancel the contract at any time, in such event; the consultant will return a prorated amount of shares based on the months remaining in the consulting agreement.   On November 18, 2009, the Company cancelled the agreement and 400,000 shares of common stock were returned to the Company.  As of December 31, 2009 $70,000 is recorded as consulting expense and $140,000 of deferred compensation was reclassified to $0 (See Note 7(B)).

34

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

On September 21, 2009, the Company entered into an eight month consulting agreement with an unrelated third party to provide public relations services.  In exchange for the services provided, the Company issued 600,000 shares of common stock having a fair value of $210,000 ($0.35/share) based upon fair value on the date of grant.  Shares will be issued on or before September 18, 2009, December 18, 2009, and March 18, 2010, in 200,000 increments.  The Company has an option to cancel the contract at any time and no additional stock issuances will be due.  On December 18, 2009, the Company cancelled the agreement and 400,000 shares of common stock were returned to the Company.  As of December 31, 2009, $70,000 is recorded as consulting expense and $140,000 of deferred compensation was reclassified to $0 (See Note 7(B)).

On October 20, 2009, the Company entered into a marketing agreement with an unrelated third party.  In exchange for the services provided, on November 21, 2009, the Company issued 30,000 shares of common stock having a fair value $53,100 ($1.77/share) based upon fair value on the date of grant, and compensation of $5,000, of which $2,500 was paid in 2009 upon the execution of the agreement and the remaining $2,500 was paid in 2010 upon completion (See Note 7(B)).

During the months of November and December 2009, the Company entered into celebrity endorsement agreements for a period of one to two years of service.  In total, 1,710,000 shares of common stock were issued having a fair value of $3,285,400 based upon fair value on the respective date of grant.  During 2009 and 2010, $87,805 and $1,712,815 was recorded as consulting expense, respectively.  For the year ended December 31, 2011, $1,484,780 is recorded as consulting expense, and $0 is recorded as deferred compensation (See Note 7(B)).

On December 3, 2009, the Company entered into a commission agreement with an unrelated third party.  The company will pay a 10% commission in shares of common stock for every passive endorsement.  In exchange for the services provided the Company issued 35,000 shares of common stock having a fair value $68,250 ($1.95/share) based upon fair value on the date of grant (See Note 7(B)).

On December 3, 2009, the Company entered into a commission agreement with an unrelated third party.  The company will pay a 10% commission in shares of common stock for every passive endorsement.  In exchange for the services provided the Company issued 240,000 shares of common stock having a fair value $468,000 ($1.95/share) based upon fair value on the date of grant (See Note 7(B)).

35

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

On December 3, 2009, the Company entered into a commission agreement with an unrelated third party.  The company will pay a 10% commission in shares of common stock for every passive endorsement.  In exchange for the services provided the Company issued 35,000 shares of common stock having a fair value $68,250 ($1.95/share) based upon fair value on the date of grant (See Note 7(B)).

On December 3, 2009, the Company entered into a commission agreement with an unrelated third party.  The company will pay a 10% commission in shares of common stock for every passive endorsement.  In exchange for the services provided the Company issued 10,000 shares of common stock having a fair value $19,500 ($1.95/share) based upon fair value on the date of grant (See Note 7(B)).

On December 15, 2009, the Company entered into a consulting agreement with an unrelated third party to provide investor services.  The Company will receive a 10% of the gross receipts from the investor relations revenue for a two year period.  In exchange for the satisfactory services provided, on December 15, 2009, the Company issued 100,000 shares of common stock having a fair value of $200,000 ($2/share) based upon fair value on the date of grant (See Note 7(B)).

On December 27, 2009, the Company entered into a consulting agreement with an unrelated third party to provide film work.  In exchange for the services provided the Company issued 10,000 shares of common stock having a fair value $19,400 ($1.94/share) based upon fair value on the date of grant (See Note 7(B)).

On December 27, 2009, the Company entered into an endorsement agreement with an unrelated third party to provide film work.  In exchange for the services provided the Company issued 10,000 shares of common stock having a fair value $19,400 ($1.94/share) based upon fair value on the date of grant (See Note 7(B)).

On December 27, 2009, the Company entered into a consulting agreement with an unrelated third party to provide film scripting, editing and production work.  In exchange for the services provided the Company issued 10,000 shares of common stock having a fair value $19,400 ($1.94/share) based upon fair value on the date of grant (See Note 7(B)).

On December 30, 2009, the Company entered into a marketing agreement with an unrelated third party for a period from January 2010 to December 2010.  In exchange for the services provided, the Company issued 500,000 shares of common stock having a fair value of $965,000 ($1.93/share) based upon fair value on the date of grant.  An additional 1,000,000 shares of common stock having a fair value of $1,930,000 ($1.93/share) based upon fair value on the date of grant, were issued for an additional sponsorship commitment. The additional 1,000,000 shares were to be held in escrow until June 30, 2010, at which point the unrelated party would have 15 days to accept or decline the additional shares.As of December 31, 2010, the shares were returned back to the Company’s treasury due to non-performance of services and no additional shares will be issued (See Note 7(B)).

36

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

On December 31, 2009, the Company entered into a consulting agreement with an unrelated third party for a period from December 31, 2009 through March 30, 2011.  In exchange for the services provided, the Company issued 75,000 shares of common stock having a fair value of $144,750 ($1.93/share) based upon fair value on the date of grant, and deliverable in three increments of 25,000 shares of common stock each. The first 25,000 shares will be delivered upon the execution of the agreement and the other two increments will be delivered in six and twelve months upon the successful fulfillment of the agreement (See Note 7(B)).

On December 31, 2009, the Company entered into a consulting agreement with an unrelated third party for a period from December 31, 2009 through March 30, 2011.  In exchange for the services provided, the Company issued 75,000 shares of common stock having a fair value of $144,750 ($1.93/share) based upon fair value on the date of grant, and deliverable in three increments of 25,000 each. The first 25,000 shares will be delivered upon the execution of the agreement and the other two will be delivered in six and twelve months upon the successful fulfillment of the agreement (See Note 7(B)).

On December 31, 2009, the Company entered into a consulting agreement with an unrelated third party for a period from December 31, 2009 through December 31, 2010.  In exchange for the services provided, the Company issued 500,000 shares of common stock having a fair value of $965,000 ($1.93/share) based upon fair value on the date of grant (See Note 7(B)).

On January 11, 2010, the Company entered into a twelve month agreement with an unrelated third party for investor relations press release service for an annual fee of $14,250 and an initial onetime fee of $250.

On January 15, 2010, the Company entered into a two year celebrity endorsement agreement.  In total, 100,000 shares of common stock were issued having a fair value of $170,000($1.70/share) based upon fair value on the date of grant (See Note 7(B)).

On February 1, 2010, the Company entered into a twelve month consulting agreement effective February 5, 2010, with an unrelated third party to produce music compositions for a fee of $500.  The agreement can be renewed for up to two additional years for a fee of $500 for the first renewal year and $750 for the second renewal year.

On February 17, 2010, the Company entered into a twelve month consulting agreement with an unrelated third party effective February 17, 2010.  In exchange for the services provided, the Company issued 1,000,000 shares of common stock having a fair value of $1,240,000 ($1.24/share) based upon fair value on the date of grant (See Note 7(B)).

On June 1, 2010, the Company entered into a twelve month consulting agreement to provide for consulting and business services in raising capital.  The Company agrees to pay a finder’s fee on all capital raised in stock and warrants.  The Company paid an initial nonrefundable retainer fee by issuing 40,000 shares of stock having a value of $10,000 ($0.25/share) based upon fair value on the date of the agreement.  In conjunction with the stock payment, the Company also issued one warrant attached to each share of stock exercisable at $0.50 per warrant.  Based upon the number of shares (40,000 shares) of stock issued, the Company issued 40,000 warrants (See Note 7(B) and Note 7(C).

37

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

On May 11, 2010, the Company acquired the rights to an audio technology known as Max Audio Technology (Max) through a share exchange, whereby the Company issued 30,000,000 shares of common stock to two individuals in exchange for their rights in Max having a value of $7,500,000 based upon recent market value ($0.25/share).  (See Note 7(H)).

In accordance with the share exchange, the former owners to the rights of Max became Executives of the Company.  The two new executives individually entered into employment agreements with the Company on May 11, 2010.  The term of the employment agreements are for ten years of service at a monthly compensation of $8,500 for each executive.  In addition, the Executives are entitled to receive 5% of all revenues derived from the sale of all products and services related to the Max Audio Technology.  On January 2, 2011, the agreement was cancelled.

On April 15, 2010, the Company entered into a finder’s fee agreement.  For each qualified investor introduced to the Company by the consultant, the Company will pay a 10% fee in cash equal to 10% of the dollar amount of securities purchased,  In addition, the Company will pay a 10% fee in warrants equal to 10% of the number of shares of stock purchased (See Note 7(C)).

On August 8, 2010, the Company entered into a consulting agreement with an unrelated third party to provide consulting services.  Upon the execution of the agreement the consultant received 100,000 shares of common stock.  A monthly issuance of 100,000 shares of common stock will be issued as a compensation of services provided.  The term of the agreement is for three months and will continue to renew for three month intervals unless cancelled by either party.  The agreement was cancelled on November 1, 2010 (See Note 7(B)).

On August 17, 2010, the Company entered into a consulting agreement.  The agreement shall remain in effect until terminated.  In exchange for the services provided, the consultant will receive a $500 a month allowance for general expenses.  In addition, for all the new business brought to the Company the consultant will receive a 10% compensation for each gross dollar received by the Company.  On February 15, 2011, the Company terminated the agreement.

On December 14, 2010, the Company entered into to a consulting agreement for consulting and advertising services.  Upon the execution of the agreement, the consultant received 250,000 shares with an additional 750,000 shares to be issued upon consultant obtaining sponsorship rights in the year 2011.  The sponsorship rights were not obtained and the agreement was cancelled in 2011 and the additional 750,000 shares were never issued (See Note 7(B)).

38

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

On February 17, 2011, the Company entered into a consulting agreement for public relations and communications services.  In exchange for the services provided, the consultant received 500,000 shares of common stock. The term of the agreement is for one year (See Note 7 (B)).

On March 3, 2011, the Company entered into a consulting agreement for public relations and communications services.  In exchange for the services provided, the consultant received 1,000,000 shares of common stock. The term of the agreement is for one year (See Note 7 (B)).

On June 10, 2011, the Company entered into a five year advisory board consulting agreement with three persons to provide for consulting and business services.  In exchange for the services provided, the consultants received 100,000 shares of common stock each.  (See Note 7(B)).

On June 15, 2011, the Company entered into a consulting agreement with an unrelated third party for software and computer technology services.  In exchange for the services provided, the consultant will be paid $70 per hour with $50 per hour paid in cash and $20 per hour paid in Company stock at $0.10 per share.  The term of the agreement is for one year. (See Note 7(B)).

On July 1, 2011, the Company entered into a consulting agreement with an unrelated third party for trade show services.  In exchange for the services provided, the consultant received 6,500 shares of common stock at $0.08/per share. The agreement was for one-time services. (See Note 7(B)).

During the year ended December 31, 2011, the Company entered into an agreement with an unrelated third party for software and computer technology services.  In exchange for the services provided, the consultant received 76,483 shares of common stock at $0.10 – 0.39 per share. The term of the agreement is for one year. (See Note 7(B)).

In September 2011, the Company entered into a five year advisory board consulting agreement with three persons to provide for consulting and business services.  In exchange for the services provided, the consultants received 100,000 shares of Company stock at $0.23 – 0.39 per share.  The terms of the agreements are for five years. (See Note 7(B)).

On September 21, 2011, the Company entered into a consulting agreement with an unrelated third party for investor relation services.  In exchange for the services provided, the consultant received 400,000 shares of Company stock at $0.25 per share.  The term of the agreement is for six months. (See Note 7(B)).

39

MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

During the three months ended December 31, 2011, the Company entered into a five year advisory board consulting agreement with five persons to provide for consulting and business services.  In exchange for the services provided, the consultants received 100,000 shares of Company stock at $0.47 – 0.88 per share.  The terms of the agreements are for five years. (See Note 7(B)).

(C) Operating Lease Agreements

On September 1, 2010 the Company executed a three-year non-cancelable operating lease for its new corporate office space. The lease began on October 1, 2010 and expires on September 30, 2013.  Total base rent due during the term of the lease is $134,880.

NOTE 9             RELATED PARTY TRANSACTIONS

During the year ended December 31, 2008, the Company received $18,803 from the principal stockholder.  Pursuant to the terms of the loan, the loan is bearing an annual interest rate of 3.25% and due on demand.  In 2008, the Company repaid $15,000 in principal to the principal stockholder.  In 2009, the Company repaid $3,803 in principal to the principal stockholder.  As of December 31, 2010, the principal portion of this principal stockholder loan balance has been repaid (See Note 3).

On May 11, 2009, the Company received $9,500 from a principal stockholder. During the year ended December 31, 2009, the Company repaid $1,500 in principal to the principal stockholder.  Pursuant to the terms of the loan, the loan is bearing an annual interest rate of 3.25% and is due on demand (See Note 3).

On May 22, 2009, the Company received $15,000 from a principal stockholder.  During the year ended December 31, 2010, the Company repaid $6,000 in principal to a principal stockholder under the terms of the loan.  Pursuant to the terms of the loan, the loan is bearing an annual interest rate of 3.25% and is due on demand (See Note 3).

On May 26, 2009, the Company received $16,700 from a principal stockholder.  During the year ended December 31, 2010, the Company repaid $15,700 in principal to the principal stockholder under the terms of this loan.  Pursuant to the terms of the loan, the loan is bearing an annual interest rate of 3.25% and is due on demand (See Note 3).

During the year ended December 31, 2011, the Company repaid $18,000 in principal and $2,116 of accrued interest to the principal stockholder related to these principal loans (See Note 3).

On May 28, 2009, the Company entered into a two year line of credit agreement with a principal stockholder in the amount of $100,000.  The line of credit carries an interest rate at 3.25%.  As of December 31, 2011, the principal shareholder has advanced the Company $100,000 under the terms of this line of credit agreement (See Note 4).

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MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

On November 10, 2009, the Company entered into a two year line of credit agreement with a principal stockholder in the amount of $100,000.  The line of credit carries an interest rate at 3.25%.  As of December 31, 2011, the principal shareholder has advanced $100,000 to the Company under the terms of this line of credit agreement (See Note 4).

On March 25, 2010, the Company entered into a two year line of credit agreement with the principal stockholder in the amount of $500,000.  The line of credit carries an interest rate of 3.25%.  On February 17, 2011, the principal stockholder converted $100,000 of the line of credit owed into 909,091 shares of common stock at $0.11 per share.  As of December 31, 2011, the principal stockholder has advanced $360,580 to the Company under this line of credit agreement (See Note 7(G) and Note 4).

As of December 31, 2011, the Company repaid $460,580 in principal and $11,283 of accrued interest to the principal stockholder related to these lines of credit (See Note 4).

On October 14, 2008, the Company issued 44,900,000 shares of common stock to its founder having a fair value of $44,900 ($0.001/share) in exchange for services provided.  As a result of the forward split, the 44,900,000 shares were increased to 179,600,000 shares and its purchase price was similarly adjusted to $0.00025 (See Note 7(B) and Note 7(D)).

On October 13, 2008, the Company executed an employment agreement with its President and CEO.  The term of the agreement is ten years.  As compensation for services, the President will receive a monthly compensation of $18,000 beginning October 13, 2008.  In addition, to the base salary, the employee is entitled to receive a 10% commission of all sales of the Corporation.  The agreement also calls for the employee to receive health benefits (See Note 8(A)).

On June 2, 2010, a principal stockholder converted $283,652 of accrued compensation into 945,507 shares of common stock at $0.30 per share.  (See Note 7(G)).

On February 17, 2011, a principal stockholder converted $144,000 of accrued compensation into 1,309,091 shares of common stock at $.0.11 per share. (See Note 7(G)).

During the fourth quarter of 2008, the principal stockholder contributed office space with a fair market value of $2,913 (See Note 7(F)).

For the year ended December 31, 2009, the principal stockholder contributed office space with a fair market value of $12,600 (See Note 7(F)).

For the year ended December 31, 2010, the principal stockholder contributed office space with a fair value of $9,450 (See Note 7(F)).

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MAX SOUND CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

AS OF JUNE 30, 2012

(UNAUDITED)

NOTE 10           LITIGATION

From time to time, the Company may become involved in various lawsuits and legal proceedings, which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm its business.

On February 6, 2012, the Company filed a suit for declaratory judgment and rescission of contract associated with a former consultant for failure to perform contractual requirements.  It seeks clarification that the former consultant is not owed 750,000 shares of restricted common stock.  The defendants have been served.  This case will be vigorously prosecuted and has a good likelihood of a favorable outcome. The case seeks in excess of the jurisdictional amount which is $50,000 dollars.

On February 21, 2012, the Company filed a suit for breach of contract, intentional misrepresentation, negligent misrepresentation, fraud, false advertising, and unfair competition with a former consultant.   It seeks damages due to their alleged failure to meet the contractual requirements regarding promotions.  The defendant has just recently been served.  This case will be vigorously prosecuted and has a good likelihood of success.  The case seeks in excess of the jurisdictional amount which is $50,000 dollars. No assurance can be given as to the ultimate outcome of these actions or its effect on the Company.

NOTE 11           SUBSEQUENT EVENTS

In preparing these financial statements, the Company has evaluated events and transactions for potential recognition or disclosure as follows:

On July 16, 2012, the Company entered into an agreement whereby the Company will issue up to $58,333 in a convertible note.  The note matures on January 15, 2013 and bears an interest rate of 10%.  The conversion price equals the “Variable Conversion Price”, which is 70% of the “Market Price”, which is the low traded price of the common stock during the twenty (20) trading day period prior to the conversion.

On July 19, 2012, the Company entered into an agreement whereby the Company will issue up to $110,000 in a convertible note.  The note matures on April 19, 2013 and bears an interest rate of 8%.  The conversion price equals the “Variable Conversion Price”, which is 70% of the “Market Price”, which is the average of the lowest three (3) trading prices for the common stock during the ten (10) trading day period prior to the conversion.

On July 30, 2012, the Company entered into an agreement whereby the Company will issue up to $111,000 in a convertible note.  The note matures on April 30, 2013 and bears an interest rate of 8%.  The conversion price equals the “Variable Conversion Price”, which is 70% of the “Market Price”, which is the average of the lowest three (3) trading prices for the common stock during the ten (10) trading day period prior to the conversion.

On August 3, 2012, the Company entered into an agreement whereby the Company will issue up to $82,500 in a convertible note.  The note matures on August 3, 2013 and bears an interest rate of 4%.  The conversion price equals the “Variable Conversion Price”, which is 70% of the “Market Price”, which is the average of the lowest three (3) trading prices for the common stock during the ten (10) trading day period prior to the conversion.

In July and August of 2012, the Company issued 125,000 shares of stock to an employee per an employment agreement dated June 11, 2012.

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ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following plan of operation provides information which management believes is relevant to an assessment and understanding of our results of operations and financial condition. The discussion should be read along with our financial statements and notes thereto. This section includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance. Forward-looking statements are often identified by words like believe, expect, estimate, anticipate, intend, project and similar expressions, or words which, by their nature, refer to future events. You should not place undue certainty on these forward-looking statements. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our predictions.  We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

Corporate History and Structure

We were incorporated in the State of Delaware as of December 9, 2005 as 43010, Inc. to engage in any lawful corporate undertaking, including, but not limited to, locating and negotiating with a business entity for combination in the form of a merger, stock-for-stock exchange or stock-for-assets exchange. On October 7, 2008, pursuant to the terms of a stock purchase agreement, Mr. Greg Halpern purchased a total of 100,000 shares of our common stock from Michael Raleigh for an aggregate of $30,000 in cash. The total of 100,000 shares represented 100% of our issued and outstanding common stock at the time of the transfer. As a result, Mr. Halpern became our sole shareholder. As part of the acquisition, and pursuant to the Stock Purchase Agreement, Michael Raleigh, our then President, CEO, CFO, and Chairman resigned from all the positions he held in the company, and Mr. Halpern was appointed as our President, CEO CFO and Chairman. The original business model was developed by Mr. Halpern in September of 2008 and began when he joined the company on October 7, 2008. In October 2008, we became a development stage company focused on creating an Internet search engine and networking web site. 

In May of 2010, we acquired the worldwide rights to all fields of use for Max Sound HD Audio technology. In November of 2010, we opened our post-production facility for Max Sound HD Audio in Santa Monica California.  On January 17, 2011, Greg Halpern resigned as our CEO and we entered into an employment agreement with John Blaisure to serve as our new CEO.  In February of 2011, after several successful demonstrations of our Max Sound Audio technology to various multi-media industry company executives, we decided to shift the focus of the Company to the Max Sound HD Audio technology and commenced the name change from So Act Network, Inc. to Max Sound Corporation and the symbol from SOAN to MAXD.

The Company is in negotiations with several multi-media companies that will utilize our HD Audio solution in the future.

A new video is currently available on the company website at http://www.maxsound.com. The Max Sound® Technology Highlights Video is 10 minutes long and summarizes the HD Audio™ process including meeting the inventor of the technology and showing the need for high definition audio in several key vertical markets.

Plan of Operation

We began our operations on October 8, 2008 when we purchased the Form 10 Company from the previous owners.  Since that date, we have completed financing to raise initial start-up money for the building of our internet search engine and social networking and to start our operations.  

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We have also received three loans from Mr. Greg Halpern, in the amount of $9,500, $15,000 and $16,700 on May 11, May 22, and May 26, 2009, respectively.  Each of the loans bears an interest rate equal to the prime rate as of the date of issuance.  As of June 30, 2012, the Company owes $0 in principal and $0 in accrued interest on these loans.

We entered into three Credit Line Agreements with Greg Halpern.  The first two have a $0 principal balance and one expired in May of 2011, and the second expired in November of 2011.  The third Credit Line Agreement issued by Mr. Halpern in March 2010 is for an additional $500,000 and matured in March of 2012.  All three agreements accrue interest at the prime rate as of the date of issuance.  The prime rate of interest is the rate of interest that major banks charge their most creditworthy customers.  For the purposes of these agreements, we shall determine the prime rate by using the prime rate reported by the Wall Street Journal on the date funds are extended to the Company.  Based on the prime rate as of the date of issuance, the prime rate shall be 3.25%.  As of June 30, 2012, the Company owes $0 in principal and $0 in accrued interest related to the third line of credit.

In 2011, the Company has received from Mr. Halpern additional net advances on the established lines of credit in the amount of $134,000 and forgiveness of amounts owed to Mr. Halpern of $244,000 through conversion of debt notes and accrued salary into shares at $0.11 cents per share.  This further demonstrates our Chairman’s ongoing commitment thus far to continue financing the Company’s needs.  While the Company expects to have ongoing needs for additional financing, the amount of those needs is not clearly established as the Company moves forward.

In February of 2011, management shifted the primary focus of the Company to the marketing of the Max Sound HD Audio Technology.  The Company believes that Max Sound HD Audio Technology is a game changer for several vertical markets whose demand will create revenue opportunities in the fourth quarter of 2012 that will meet the Company’s needs to eliminate its going concern status in 2013.

The Company believes that the Mr. Halpern's (our chairman/principal stockholder) past history of extending credit and willingness to further extend credit in the future as needed, along with the capital raised by the funding campaign in the summer of 2011, and the Company's ability to secure third party financing will allow the Company to cover the additional expense arising from the maintenance of our regulatory filings with the SEC, the development of our technology, and will allow for the Company to continue marketing the Max Sound HD Audio Technology to Multi-Media Industry Users of Audio and Audio with Video products.

We expect our financial requirements to increase with the additional expenses needed to promote the Max Sound® Audio technology.  We plan to fund these additional expenses by loans from our chairman/principal stockholder, along with pursing various private funding opportunities until such time that our revenue stream is adequate enough to provide the necessary funds.

In the event that we are unable to obtain additional funding from third parties, additional capital funding campaigns, or our chairman/principal stockholder either fails to extend us more financing, declines to loan additional cash, declines to fund new lines of credit, declines to defer his salary payments, we will no longer be able to continue to operate and will have to cease operations unless we begin to generate sufficient revenue to cover our costs.

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Results of Operations

The following tables set forth key components of our results of operations for the periods indicated, in dollars, and key components of our revenue for the period indicated, in dollars.

	For the three months Ended June 30,
	2012			2011
Revenue	$	--		$	-
Operating Expenses
General and Administrative		144,717			32,243
Endorsement Fees *		-			411,900
Consulting Fees *		139,611			455,246
Professional Fees		26,059			26,883
Compensation		162,000			54,000
Total Operating Expenses		472,387			980,272
Loss from Operations		(472,387	)		(980,272	)
Other Income / (Expense)
Interest Income		57			25
Interest Expense		(127,730	)		(2,647	)
Amortization of Debt Offering Costs		(29,178	)		-
Amortization of Debt Discount		(185,392	)		(3,139	)
Change in fair value of embedded derivative liability		(9,285	)		17,040
Total Other Income / (Expense)		(351,528	)		11,279
Provision for Income  Taxes		-			-
Net Loss	$	(823,915	)	$	(968,993	)
Net Loss Per Share  - Basic and Diluted	$	(0.00	)	$	(0.00	)
Weighted average number of shares outstanding
during the year Basic and Diluted		255,335,394			234,809,929

* The line items Endorsement Fees and Consulting Fees represent mainly non-recurring compensation in the form of stock at the then current market value at the time of entering into the services agreement.

For the three months ended June 30, 2012 and for the three months ended June 30, 2011

General and Administrative Expenses: Our general and administrative expenses were $144,717 for the three months ended June 30, 2012 and $32,243 for the three months ended June 30, 2011, representing an increase of $112,474 or approximately 349%, as a result of our expenses on the general operation of the Company including added personnel, product development and marketing of our Max Sound Technology.

Endorsement Fees:  Our endorsement fees were $0 for the three months ended June 30, 2012 and $411,900 for the three months ended June 30, 2011, representing a decrease of $411,900 or approximately 100% as a result of the acceleration in expensing of the remaining multi-year consulting agreements related to the marketing of our social networking website which was abandoned on August 16, 2011.

Consulting Fees:  Our consulting fees were $139,611 for the three months ended June 30, 2012 and $455,246 for the three months ended June 30, 2011, representing a decrease of $315,635, or approximately 69%. While the Company has increased the use of consultants to assist the Company in raising capital, and the promotion of the Max Sound Technology, the overall substantial decrease was due primarily to the discontinued use of consultants needed for promotional and marketing services related to our social networking website which was abandoned on August 16, 2011.

Professional Fees: Our professional fees were $26,059 for the three months ended June 30, 2012 and $26,883 for the three months ended June 30, 2011, representing a decrease of $824 or approximately 3%.

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Compensation: Our compensation expenses were $162,000 for the three months ended June 30, 2012 and $54,000 for the three months ended June 30, 2011, representing an increase of $108,000, or 200%, as a result of our expensing of monthly compensation to our CFO, CEO, CIO and to our CTO pursuant to their employment agreements.

Net Loss: Our net loss for the three months ended June 30, 2012 and 2011, were $823,915, compared to $968,996, respectively. While the operational expenses in marketing our Max Sound technology increased from the same period of last year, the overall amount of net loss substantially decreased as a result of the decline in expenses due to the abandonment of our social networking website.

	For the six months Ended June 30,
	2012			2011
Revenue	$	-		$	-
Operating Expenses
General and Administrative		338,332			69,135
Endorsement Fees *		-			819,273
Consulting Fees *		259,611			2,382.106
Professional Fees		84,629			67,559
Compensation		324,000			108,000
Total Operating Expenses		1,006,572			3,446,073
Loss from Operations		(1,006,572	)		(3,446,073	)
Other Income / (Expense)
Interest Income		129			25
Interest Expense		(127,730	)		(5,682	)
Amortization of Debt Offering Costs		(30,380	)		-
Amortization of Debt Discount		(189,925	)		(9,371	)
Change in fair value of embedded derivative liability		(79,789	)		(32,085	)
Total Other Income / (Expense)		(427,695	)		(47,113	)
Provision for Income  Taxes		-			-
Net Loss	$	(1,434,267	)	$	(3,493,186	)
Net Loss Per Share  - Basic and Diluted	$	(0.01	)	$	(0.02	)
Weighted average number of shares outstanding
during the year Basic and Diluted		255,274,304			231,642,501

* The line items Endorsement Fees and Consulting Fees represent mainly non-recurring compensation in the form of stock at the then current market value at the time of entering into the services agreement.

For the six months ended June 30, 2012 and for the six months ended June 30, 2011

General and Administrative Expenses: Our general and administrative expenses were $338,332 for the six months ended June 30, 2012 and $69,135 for the six months ended June 30, 2011, representing an increase of $269,197 or approximately 390%, as a result of our expenses on the general operation of the Company including added personnel, product development and marketing of our Max Sound Technology.

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Endorsement Fees:  Our endorsement fees were $0 for the six months ended June 30, 2012 and $819,273 for the six months ended June 30, 2011, representing an decrease of $819,273 or approximately 100% as a result of the acceleration in expensing of the remaining multi-year consulting agreements related to the marketing of our social networking website which was abandoned on August 16, 2011.

Consulting Fees:  Our consulting fees were $259,611 for the six months ended June 30, 2012 and $2,382,106 for the six months ended June 30, 2011, representing a decrease of $2,122,495, or approximately 89%. While the Company has increased the use of consultants to assist the Company in raising capital, and the promotion of the Max Sound Technology, the overall substantial decrease was due primarily to the discontinued use of consultants needed for promotional and marketing services related to our social networking website which was abandoned on August 16, 2011.

Professional Fees: Our professional fees were $84,629 for the six months ended June 30, 2012 and $67,559 for the six months ended June 30, 2011, representing an increase of $17,070 or approximately 25% as a result of expanded business activities by the Company and increases in fees by our professionals.

Compensation: Our compensation expenses were $324,000 for the six months ended June 30, 2012 and $108,000 for the six months ended June 30, 2011, representing an increase of $216,000, or approximately 200% as a result of our expensing of monthly compensation to our CFO, CEO, CIO and to our CTO pursuant to their employment agreements.

Net Loss: Our net loss for the six months ended June 30, 2012 and 2011, were $1,434,267, compared to $3,493,186, respectively. While the operational expenses in marketing our Max Sound technology increased from the same period of last year, the overall amount of net loss substantially decreased as a result of the decline in expenses due to the abandonment of our social networking website.

Liquidity and Capital Resources

As reflected in the accompanying financial statements, the Company is in the development stage with minimal operations.  Revenue was $0 and $0 for the six months ended June 30, 2012 and 2011, respectively. We have an accumulated deficit of $15,794,251 for the period from December 9, 2005 (inception) to June 30, 2012, and have negative cash flow from operations of $2,646,452 from inception.  

Our financial statements have been presented on the basis that it is a going concern, which contemplates the realization of revenues from our subscriber base and the satisfaction of liabilities in the normal course of business. We have incurred losses from inception. These factors raise substantial doubt about our ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company's ability to raise additional capital and implement its business plan. The financial statements do not include any adjustments that would be necessary if the Company is unable to continue as a going concern.

Management believes the actions presently being taken to obtain additional funding and implement its strategic plans provide for the Company to continue as a going concern.

From our inception through June 30, 2012, our primary source of funds has been the proceeds of private offerings of our common stock and loans from our principal stockholder. Our need to obtain capital from outside investors is expected to continue until we are able to achieve profitable operations, if ever. There is no assurance that management will be successful in fulfilling all or any elements of its plans.  

We have received three loans from Mr. Greg Halpern, in the amount of $9,500, $15,000 and $16,700 on May 11, May 22, and May 26, 2009, respectively. Each of these loans is due upon demand and accrue interest at the prime rate as of the date of issuance. The prime rate of interest is the rate of interest that major banks charge their most creditworthy customers. For the purposes of this agreement, we shall determine the prime rate by using the prime rate reported by the Wall Street Journal on the date funds are extended to the Company. Based on the prime rate as of the date of issuance, we have determined that the prime rate shall be 3.25%. As of June 30, 2012, we owed $0 in principal and $0 in accrued interest.

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We have entered into three lines of credit with our principal stockholder, Mr. Greg Halpern, in the amount of $100,000, $100,000, and $500,000, respectively. Pursuant to the lines of credit agreements, the lines of credits bear an annual interest rate of 3.25% and were due on May 29, 2011, November 11, 2011, and March 25, 2012.  As of June 30, 2012, we owe $0 in principal and accrued interest of $0 related to these lines of credit

On October 13, 2008, the Company entered into an employment agreement with the principal stockholder whereby the principal stockholder would be paid $18,000 per month for a term of ten (10) years for services rendered as the Chief Executive Officer of the Company.

On February 18, 2011 the Company’s Board authorized the issuance and conversion of 2,218,182 shares of par value $0.0001 common stock at $.11 per share as payment to the principal stockholder for conversion of $100,000 of the debt outstanding and the full $144,000 in accrued wages payable owed as of January 31, 2011. Pursuant to the Board’s authorization and resulting issuance of shares, the principal shareholder has entered into an agreement (the “Conversion Agreement”) with the Company relinquishing the Company from any further obligation to the principal shareholder with respect to $100,000 of the note payable outstanding and all amounts due and payable as wages as of January 31, 2011. 

Recent Accounting Pronouncements

There are no new accounting pronouncements that are expected to have a material impact on the Company's financial position or results of operations.

Critical Accounting Policies and Estimates

Our financial statements and related public financial information are based on the application of accounting principles generally accepted in the United States (“GAAP”). GAAP requires the use of estimates; assumptions, judgments and subjective interpretations of accounting principles that have an impact on the assets, liabilities, revenues and expense amounts reported. These estimates can also affect supplemental information contained in our external disclosures including information regarding contingencies, risk and financial condition. We believe our use of estimates and underlying accounting assumptions adhere to

GAAP and are consistently and conservatively applied. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ materially from these estimates under different assumptions or conditions. We continue to monitor significant estimates made during the preparation of our financial statements.

Use of Estimates:In preparing financial statements in conformity with generally accepted accounting principles, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reported period.  Actual results could differ from those estimates.

Revenue Recognition:  Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed or determinable and collectability is assured.  We had $0 and $0 in revenue for the three months ended June 30, 2012 and 2011, respectively.

Stock-Based Compensation:

In December 2004, the FASB issued FASB Accounting Standards Codification No. 718, Compensation – Stock Compensation.  Under FASB Accounting Standards Codification No. 718, companies are required to measure the compensation costs of share-based compensation arrangements based on the grant-date fair value and recognize the costs in the financial statements over the period during which employees are required to provide services. Share-based compensation arrangements include stock options, restricted share plans, performance-based awards, share appreciation rights and employee share purchase plans. As such, compensation cost is measured on the date of grant at their fair value. Such compensation amounts, if any, are amortized over the respective vesting periods of the option grant. The Company applies this statement prospectively.

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Equity instruments (“instruments”) issued to other than employees are recorded on the basis of the fair value of the instruments, as required by FASB Accounting Standards Codification No. 718.  FASB Accounting Standards Codification No. 505, Equity Based Payments to Non-Employees defines the measurement date and recognition period for such instruments.  In general, the measurement date is when either a (a) performance commitment, as defined, is reached or (b) the earlier of (i) the non-employee performance is complete or (ii) the instruments are vested. The measured value related to the instruments is recognized over a period based on the facts and circumstances of each particular grant as defined in the FASB Accounting Standards Codification.

Derivative Financial Instruments

Fair value accounting requires bifurcation of embedded derivative instruments such as conversion features in convertible debt or equity instruments, and measurement of their fair value for accounting purposes. In determining the appropriate fair value, the Company uses the Black-Scholes option-pricing model.  In assessing the convertible debt instruments, management determines if the convertible debt host instrument is conventional convertible debt and further if there is a beneficial conversion feature requiring measurement.  If the instrument is not considered conventional convertible debt, the Company will continue its evaluation process of these instruments as derivative financial instruments.

Once determined, derivative liabilities are adjusted to reflect fair value at each reporting period end, with any increase or decrease in the fair value being recorded in results of operations as an adjustment to fair value of derivatives.  In addition, the fair value of freestanding derivative instruments such as warrants, are also valued using the Black-Scholes option-pricing model.  

Impairment of Long-Lived Assets

The Company accounts for its long-lived assets in accordance with ASC Topic 360-10-05, Accounting for the Impairment or Disposal of Long-Lived Assets."  ASC Topic 360-10-05 requires that long-lived assets, such as technology rights, be reviewed for impairment annually, or whenever events or changes in circumstances indicate that the historical cost carrying value of an asset may no longer be appropriate.  The Company assesses recoverability of the carrying value of an asset by estimating the future net cash flows expected to result from the asset, including the eventual disposition.  If the future net cash flows are less than the carrying value of an asset, an impairment loss is recorded equal to the difference between the asset's carrying value and fair value or disposable value.  For the year ended December 31, 2011, the Company completed an impairment analysis on its' long-lived assets, their technology rights, and determined that no impairment was necessary.

The Company believes that the accounting estimate related to asset impairment is a "critical accounting estimate" because the impairment methodology is highly susceptible to change from period to period, because it requires management to make assumptions about future cash flows, and because the impact of recognizing impairment could have a significant effect on operations. Management's assumptions about future cash flows require significant judgment because actual business operations of marketing the technology rights is in its infancy stages and managements expects that their future operating levels to fluctuate. The analysis included assumptions that are based on annual business plans and other forecasted results which are used to reflect market-based estimates of the risks associated with the projected cash flows, based on the best information available as of the date of the impairment test. There can be no assurance that the estimates and assumptions used in the impairment tests will prove to be accurate predictions of the future.  If the future adversely differs from management's best estimate of key economic assumptions, and if associated future cash flows materially decrease, the Company may be required to record impairment charges related to its indefinite life intangible asset.

Prior to February of 2011, the Company's business operations were related to the development and launching of a social networking website.  However, since February of 2011, our business focus has been on the marketing of our Max Sound HD Audio Technology.  Since 2011, was our initial year of marketing our technology, management considers past operational levels to be inconsistent with future operations mainly due to the shift in business focus.  In our impairment testing, the Company made assumptions towards the income and expenses expected in the future including, but not limited to, determining the actual expenses incurred in the current year that were attributable to the new business focus in order to develop an annual cost benchmark, trends in the marketplace, feedback from current and past marketing activities, and assessments upon the useful life of the technology rights.

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The Company's primary focus over the next three to five years will be centered around the marketing and implementation of their technology in order to take advantage of the current trends in the marketplace for users of their technology.  In particular, the Company expects that expenses will increase significantly from year to year over the next five years, at which time in year six and beyond the year to year change will be a minimal increase.  In addition, the Company expects minimal revenue over the next two years, while in year three to six the Company expects to realize significant year to year increases in revenue, at which time in year seven and beyond the year to year change will be a minimal increase.

As part of the impairment test performed in December of 2011, the Company reviewed its' initial useful life analysis, in reference to their technology, and updated this analysis with factors that existed at the time of the impairment testing and determined that nothing had occurred in the marketplace that would change their initial determination of the useful life of their technology. The analysis included researching known technological advances in the marketplace and determining if those advances which are similar to the Company's products would limit the useful life of the asset. The Company believes that the technological advances in the marketplace are geared to developing different playback devices and the implementation of technology that is similar to the Company's technology. Thus, the Company concluded that their technology rights continue to have an indefinite useful life. However, it is understood that technological advancements could happen in the future that would limit the useful life of their technology.  If a technology was created in the future that would limit the useful life of the technology, the Company would be required to update their impairment testing to include a useful life determination of the technology and may be required to record impairment charges at some time in the future.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements, financings, or other relationships with unconsolidated entities or other persons, also known as “special purpose entities” (SPEs).

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Not required for Smaller Reporting Companies.

Item 4.  Controls and Procedures

Disclosure controls and procedures.Pursuant to Rule 13a-15(b) under the Securities Exchange Act of 1934 (“Exchange Act”), the Company carried out an evaluation, with the participation of the Company’s management, including the Company’s principal executive officer and principal financial officer of the effectiveness of the Company’s disclosure controls and procedures (as defined under Rule 13a-15(e) under the Exchange Act) as of the end of the period covered by this report. Based upon that evaluation, the Company’s principal executive officer and principal financial officer concluded that the Company’s disclosure controls and procedures are effective to ensure that information required to be disclosed by the Company in the reports that the Company files or submits under the Exchange Act, is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the Company’s management, including the Company’s principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

Changes in internal control over financial reporting. There have been no changes in our internal control over financial reporting that occurred during the quarter covered by this Quarterly Report on Form 10-Q that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

50

PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

On February 6, 2012, the Company and Greg Halpern (our Chief Financial Officer) filed a suit in Superior Court of California, Los Angeles County – West District for declaratory judgment and rescission of contract associated with a former consultant (Roy Anthony and Creative Licensing, Inc.) for failure to perform contractual requirements.  It seeks clarification that the former consultant is not owed 750,000 shares of restricted common stock.  The defendants have been served. The case seeks in excess of the jurisdictional amount which is $50,000 dollars.  The defendants have answered the complaint and have filed a cross-complaint for breach of contract, claiming that they are entitled to the 750,000 shares of common stock and that the Company breached the agreement.  The discovery phrase has commenced and the Company has put forth initial written discovery on the defendants.

On February 21, 2012, the Company filed a suit against a former consultant in the Superior Court of California, Los Angeles County – Central District for breach of contract, intentional misrepresentation, negligent misrepresentation, fraud, false advertising, and unfair competition. It seeks damages from the former consultant due to their alleged failure to meet the contractual requirements regarding promotions and seeks in excess of the jurisdictional amount which is $50,000 dollars. The defendant has just recently been served.

Item 1A. Risk Factors.

Not required for smaller reporting companies.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

On June 11, 2012, the Company issued 200,000 warrants under consulting agreements.  The warrants are exercisable for common stock and immediately vested.  The warrants expire in three years from the date of issuance and have an exercise price of $0.25 per share.

The foregoing securities were issued in reliance on the exemption under Section 4(2) of the Securities Act of 1933, as amended (the “Securities Act”). These securities qualified for exemption under Section 4(2) of the Securities Act of 1933 since the issuance securities by us did not involve a public offering. The offerings were not “public offerings” as defined in Section 4(2) due to the insubstantial number of persons involved in the deal, size of the offering, manner of the offering and number of shares offered. We did not undertake offerings in which we sold a high number of shares to a high number of investors.  In addition, these holders of our securities had the necessary investment intent as required by Section 4(2) since they agreed to and received share certificates bearing a legend stating that such shares are restricted pursuant to Rule 144 of the 1933 Securities Act.  This restriction ensures that these securities would not be immediately redistributed into the market and therefore not be part of a “public offering.” Based on an analysis of the above factors, we have met the requirements to qualify for exemption under Section 4(2) of the Securities Act of 1933 for the foregoing transactions.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

None.

Item 5. Other Information.

None

51

Item 6. Exhibits

Exhibit No.	Title of Document
31.1*	Certification of the Principal Executive Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2*	Certification of the Principal Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1*	Certification of the Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2*	Certification of the Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS *	XBRL Instance Document
101.SCH *	XBRL Taxonomy Extension Schema Document
101.CAL *	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF *	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB *	XBRL Taxonomy Extension Label Linkbase Document
101.PRE *	XBRL Taxonomy Extension Presentation Linkbase Document

 * Filed or furnished herewith.

In accordance with SEC Release 33-8238, Exhibit 32.1 is being furnished and not filed.  

52

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Dated: August 14, 2012	MAX SOUND CORPORATION
	By:	/s/John Blaisure
		John Blaisure President and Chief Executive Officer (Duly Authorized Officer and Principal Executive Officer)

By:	/s/Greg Halpern
	Greg Halpern Chief Financial Officer (Duly Authorized Officer and Principal Financial Officer)

53 

EX-31.1

Exhibit 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

I, John Blaisure, certify that:

1. I have reviewed this Form 10-Q of Max Sound Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods present in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13-a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principals;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financing reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involved management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Max Sound Corporation
By:	/s/ John Blaisure
	John Blaisure
	President and Chief Executive Officer
	(Principal Executive Officer)

August 14, 2012

EX-31.2

Exhibit 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

I, Greg Halpern, certify that:

1. I have reviewed this Form 10-Q of Max Sound Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods present in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13-a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principals;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financing reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involved management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Max Sound Corporation
By:	/s/ Greg Halpern
	Greg Halpern
	Chief Financial Officer
	(Principal Financial Officer)

August 14, 2012

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Max Sound Corporation (the “Company”) on Form 10-Q for the period ended June 30, 2012 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, John Blaisure, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1.	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2.	The information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and result of operations of Max Sound Corporation

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

Max Sound Corporation
By:	/s/ John Blaisure
	John Blaisure
	President and Chief Executive Officer
	(Principal Executive Officer)

August 14, 2012

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Max Sound Corporation (the “Company”) on Form 10-Q for the period ended June 30, 2012 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Greg Halpern, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1.	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2.	The information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and result of operations of Max Sound Corporation

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

Max Sound Corporation
By:	/s/ Greg Halpern
	Greg Halpern
	Chief Financial Officer
	(Principal Financial Officer)

August 14, 2012

XML

Litigation (Details) (USD $)	Feb. 21, 2012	Feb. 06, 2012
Litigation (Textual)
Restricted stock		750,000
Jurisdictional amount	$ 50,000	$ 50,000

XML

Stockholders' Equity (Details 2) (Stock option [Member], USD $)	6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Stock option [Member]
Summary of option/ warrants activity
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number	12,000,000
Granted
Exercised
Forfieted
Ending balance	12,000,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Number	12,000,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price	$ 0.12
Weighted Average Exercise Price, Granted
Weighted Average Exercise Price, Ending balance	$ 0.12
Weighted Average Exercise Price, Options Exercisable at June 30, 2012	$ 0.12
Weighted Average Fair Value of Options Granted	$ 0.12

XML

Note Payable - Principal Stockholder (Details) (USD $)	12 Months Ended
	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009	Dec. 31, 2008	May 26, 2009	May 22, 2009	May 11, 2009
Note Payable Principal Stockholder (Textual)
Notes Payable, Related Parties				$ 18,803	$ 16,700	$ 15,000	$ 9,500
Related Party Transaction, Rate	3.25%	3.25%	3.25%	3.25%
Principal payment of loans	18,000		3,803	15,000
Accrued interest paid on loan	2,116,000
Receivables from Stockholder On May 11, 2009 [Member]
Note Payable Principal Stockholder (Textual)
Notes Payable, Related Parties			9,500
Related Party Transaction, Rate			3.25%
Principal payment of loans			1,500
Receivables from Stockholder On May 22, 2009 [Member]
Note Payable Principal Stockholder (Textual)
Notes Payable, Related Parties			15,000
Related Party Transaction, Rate			3.25%
Principal payment of loans			6,000
Receivables from Stockholder On May 26, 2009 [Member]
Note Payable Principal Stockholder (Textual)
Notes Payable, Related Parties			16,700
Related Party Transaction, Rate			3.25%
Principal payment of loans			$ 15,700

XML

Commitments (Details) (USD $)																																																																			12 Months Ended				12 Months Ended		3 Months Ended	6 Months Ended		1 Months Ended	6 Months Ended			6 Months Ended			1 Months Ended					3 Months Ended	6 Months Ended																			6 Months Ended				6 Months Ended				6 Months Ended						6 Months Ended				6 Months Ended										1 Months Ended		6 Months Ended
	Aug. 31, 2012	Jul. 31, 2012	Jun. 30, 2012	Dec. 31, 2011	Sep. 30, 2011	Sep. 27, 2011	Sep. 25, 2011	Sep. 24, 2011	Sep. 21, 2011	Sep. 19, 2011	Sep. 18, 2011	Sep. 12, 2011	Aug. 31, 2011	Aug. 14, 2011	Jul. 31, 2011	Jul. 01, 2011	Jun. 30, 2011	Jun. 15, 2011	May 17, 2011	May 02, 2011	Mar. 21, 2011	Mar. 03, 2011	Feb. 23, 2011	Feb. 17, 2011	Jan. 24, 2011	Jan. 17, 2011	Dec. 31, 2010	Dec. 14, 2010	Nov. 01, 2010	Oct. 01, 2010	Aug. 31, 2010	Aug. 05, 2010	Jul. 31, 2010	Jul. 23, 2010	May 31, 2010	May 27, 2010	Feb. 17, 2010	Jan. 15, 2010	Dec. 31, 2009	Dec. 30, 2009	Dec. 27, 2009	Dec. 18, 2009	Dec. 15, 2009	Dec. 03, 2009	Nov. 21, 2009	Nov. 18, 2009	Nov. 16, 2009	Nov. 12, 2009	Nov. 11, 2009	Sep. 21, 2009	Sep. 18, 2009	Aug. 31, 2009	Aug. 25, 2009	Jan. 31, 2009	Jan. 15, 2009	Jan. 14, 2009	Jan. 12, 2009	Jan. 11, 2009	Jan. 03, 2009	Jan. 02, 2009	Dec. 31, 2008	Dec. 20, 2008	Dec. 05, 2008	Nov. 24, 2008	Oct. 14, 2008	Dec. 31, 2005	Dec. 31, 2011 Celebrity endorsement agreements [Member]	Dec. 31, 2010 Celebrity endorsement agreements [Member]	Dec. 31, 2009 Celebrity endorsement agreements [Member]	Dec. 27, 2009 Celebrity endorsement agreements [Member]	Dec. 31, 2009 Celebrity endorsement agreements [Member] Minimum [Member]	Dec. 31, 2009 Celebrity endorsement agreements [Member] Maximum [Member]	Dec. 31, 2011 Advisory board consulting agreement [Member]	Jun. 30, 2012 Employment agreement [Member]	May 11, 2010 Employment agreement [Member]	Oct. 31, 2008 Employment agreement [Member] President [Member]	Jun. 30, 2012 Employment agreement [Member] President [Member]	Jun. 30, 2012 Employment agreement [Member] Executive [Member]	Feb. 04, 2011 Employment agreement [Member] Executive [Member]	Jun. 30, 2012 Employment agreement [Member] Chief internet officer [Member]	Jun. 30, 2012 Employment agreement [Member] Chief technical officer [Member]	Jun. 30, 2012 Employment agreement [Member] Senior Audio Engineer [Member]	Sep. 30, 2011 Consulting agreement [Member]	Jul. 31, 2011 Consulting agreement [Member]	Jun. 30, 2011 Consulting agreement [Member]	Aug. 31, 2010 Consulting agreement [Member]	Dec. 31, 2009 Consulting agreement [Member]	Dec. 31, 2011 Consulting agreement [Member]	Jun. 30, 2012 Consulting agreement [Member]	Sep. 21, 2011 Consulting agreement [Member]	Jul. 01, 2011 Consulting agreement [Member]	Jun. 15, 2011 Consulting agreement [Member]	Jun. 10, 2011 Consulting agreement [Member]	Mar. 03, 2011 Consulting agreement [Member]	Feb. 17, 2011 Consulting agreement [Member]	Dec. 14, 2010 Consulting agreement [Member]	Aug. 17, 2010 Consulting agreement [Member]	Aug. 08, 2010 Consulting agreement [Member]	Feb. 17, 2010 Consulting agreement [Member]	Dec. 27, 2009 Consulting agreement [Member]	Dec. 15, 2009 Consulting agreement [Member]	Dec. 31, 2011 Consulting agreement [Member] Minimum [Member]	Sep. 30, 2011 Consulting agreement [Member] Minimum [Member]	Jul. 01, 2011 Consulting agreement [Member] Minimum [Member]	Dec. 31, 2011 Consulting agreement [Member] Maximum [Member]	Sep. 30, 2011 Consulting agreement [Member] Maximum [Member]	Jul. 01, 2011 Consulting agreement [Member] Maximum [Member]	Jun. 30, 2012 Consulting agreement [Member] Development services agreement [Member]	Aug. 31, 2009 Consulting agreement [Member] Development services agreement [Member]	May 29, 2009 Consulting agreement [Member] Development services agreement [Member]	Jan. 14, 2009 Consulting agreement [Member] Development services agreement [Member]	Jun. 30, 2012 Consulting agreement [Member] Public relations services [Member]	Dec. 31, 2009 Consulting agreement [Member] Public relations services [Member]	Nov. 11, 2009 Consulting agreement [Member] Public relations services [Member]	Sep. 18, 2009 Consulting agreement [Member] Public relations services [Member]	Jun. 30, 2012 Consulting agreement [Member] Public relations services one [Member]	Mar. 18, 2010 Consulting agreement [Member] Public relations services one [Member]	Dec. 31, 2009 Consulting agreement [Member] Public relations services one [Member]	Dec. 18, 2009 Consulting agreement [Member] Public relations services one [Member]	Nov. 18, 2009 Consulting agreement [Member] Public relations services one [Member]	Sep. 18, 2009 Consulting agreement [Member] Public relations services one [Member]	Jun. 30, 2012 Consulting agreement [Member] Public relations services two [Member]	Dec. 31, 2009 Consulting agreement [Member] Public relations services two [Member]	Dec. 18, 2009 Consulting agreement [Member] Public relations services two [Member]	Sep. 21, 2009 Consulting agreement [Member] Public relations services two [Member]	Jun. 30, 2012 Consulting agreement [Member] Marketing agreement [Member]	Dec. 30, 2009 Consulting agreement [Member] Marketing agreement [Member]	Nov. 21, 2009 Consulting agreement [Member] Marketing agreement [Member]	Jan. 15, 2010 Consulting agreement [Member] Celebrity endorsement agreements [Member]	Dec. 03, 2009 Consulting agreement [Member] Commission agreement [Member]	Dec. 31, 2009 Consulting agreement [Member] Consulting agreement 1 [Member]	Dec. 31, 2009 Consulting agreement [Member] Consulting Agreement 2 [Member]	Jun. 02, 2010 Consulting agreement [Member] Consulting and business services [Member]	May 11, 2010 Consulting agreement [Member] Max audio technology [Member]	Apr. 15, 2010 Consulting agreement [Member] Finder’s fee agreement [Member]	Sep. 30, 2011 Consulting agreement [Member] Investor relation service [Member]	Sep. 30, 2011 Operating Lease Agreements [Member]	Jun. 30, 2012 Operating Lease Agreements [Member]	Sep. 01, 2010 Operating Lease Agreements [Member]
Commitments (Textual)
Term period of agreement																																																																							1 year	2 years	5 years	10 years		10 years	10 years	5 years		5 years	5 years	5 years	5 years	1 year	1 year			5 years	3 months																							6 months				6 months						8 months														6 months
Compensation for services																																																																										$ 8,500		$ 18,000	$ 18,000	$ 8,000		$ 9,000	$ 10,000	$ 6,000
Percentage commission on sales																																																																										5.00%		10.00%	10.00%	20.00%			5.00%
Compensation expense																																																																													108,000
Funding required to receive compensation																																																																														1,000,000		1,000,000
Shares of Rule 144 common stock received upon execution of the agreement																																																																														3,000,000		2,000,000
Options received by executive upon execution of the agreement																																																																														12,000,000
Number of shares employee entitled to receive as health benefits																																																																																		1,000,000
Number of shares of health benefits payable per quarter																																																																																		125,000
Per share price of issued stock			$ 0.0001	$ 0.0001	$ 0.10	$ 0.22	$ 0.39	$ 0.33	$ 0.25	$ 0.23	$ 0.22	$ 0.25	$ 0.10	$ 0.35	$ 0.10	$ 0.08	$ 0.25	$ 0.10	$ 0.07	$ 0.10	$ 0.10	$ 0.08	$ 0.10	$ 0.11	$ 0.10			$ 0.15	$ 0.25	$ 0.18	$ 0.19	$ 0.25	$ 0.20	$ 0.20	$ 0.25	$ 0.25	$ 1.24	$ 1.70	$ 1.93	$ 1.93	$ 1.94		$ 2.00	$ 1.95	$ 1.77	$ 1.50	$ 1.80	$ 1.78		$ 0.35	$ 0.35	$ 0.0625	$ 0.0625		$ 0.25	$ 0.25	$ 0.25	$ 0.25	$ 0.25	$ 0.25	$ 0.25	$ 0.25	$ 0.25	$ 0.25	$ 0.001					$ 1.94							$ 0.12																							$ 1.94	$ 2																													$ 1.95
Additional common shares received directly from the President																																																																															20,000,000
Compensation amount increase																																																																														12,000		12,000	12,000
Percentage of commission on sale equal to gross quarterly profits																																																																														10.00%									10.00%
Percentage of bonus received																																																																																	5.00%
Amount of profits derived from sales																																																																																	1,000,000
Minimum fee to construct social network software per hour																																																																																																												150
Maximum fee to construct social network software per hour																																																																																																												375
Retainer fee paid																																																																																																												20,000
Shares issued in exchange of services																																																																																			100,000					76,483		400,000	6,500																		885,714		20,000
Shares issued in exchange of service, Value																																																																																																													62,000		5,000
Per share price																																																																																										$ 0.25	$ 0.08	$ 0.10										$ 0.47	$ 0.23	$ 0.10	$ 0.88	$ 0.39	$ 0.39				$ 0.25
Number of common shares after forward split																																																						1,892,000	16,000	80,000	16,000	128,000	8,000	80,000	1,892,000	16,000	16,000	16,000		400,000																																													80,000
Common stock par value due to forward split																																																						$ 0.0625	$ 0.0625	$ 0.0625	$ 0.0625	$ 0.0625	$ 0.0625	$ 0.0625	$ 0.0625	$ 0.0625	$ 0.0625	$ 0.0625	$ 0.00025																																														$ 0.0625
Reduced hourly rate																																																																																																														75
Outstanding balance due																																																																																																														17,163
Shares valued based on the most recent fair market value																																																																																																			1,240,000										55,357						175,000						210,000				210,000		965,000	53,100	170,000		144,750	965,000	10,000	7,500,000
Share price based on the most recent fair market value																																																																																																			$ 1.24										$ 0.0625						$ 0.35						$ 0.35				$ 0.35		$ 1.93	$ 1.77	$ 1.70		$ 1.93	$ 1.93	$ 0.25	$ 0.25
Gain on the extinguishment of debt																																																																																																												6,643
Time period to cancel the contract																																																																																																																90 days
Share issued by company																																																																																																			1,000,000																500,000						600,000				600,000		500,000	30,000	100,000		75,000	500,000	40,000	30,000,000
Shares returned to company to cancel the contract																																																																																																																			200,000
Number of common shares returned to to the Company after cancellation of agreement																																								1,000,000		400,000				400,000			300,000																																																																	300,000						400,000				400,000
Consulting expense				173,260																							1,066,740												68,250	965,000																																																																									70,000					70,000					70,000
Amount of deferred compensation																																																																																																																	105,000					140,000					140,000
Reclassification of deferred compensation																																							0																																																																										0					0					0
Shares issued on increments																																										100,000																																																																											200,000		200,000		200,000				200,000						25,000
Compensation paid																																																																																																																																5,000
Number of days unrelated party would have to accept or decline additional shares																																																																																																																														15 days
Deferred compensation				0																																			105,000																												0
Compensation paid upon the execution of the agreement																																																																																																																																2,500
Compensation paid upon completion																																																																																																																																2,500
Common shares issued	125,000	125,000	255,335,394	255,184,661																2,000,000	150,000		300,000		10,000	12,000,000																													4,000		2,000	32,000	2,000	20,000						100,000			1,710,000
Value of common stock issue			25,534	25,519									1,093,700							200,000	15,000		30,000		1,000																														1,000		500	8,000	500	5,000	118,250					100			3,285,400	19,400																														19,400	200,000
Consulting expense																																																																			1,484,780	1,712,815	87,805
Number of common stock issued for services						100,000	1,500	100,000	400,000	100,000	15,403	2,860		2,443		6,500	300,000	15,980	2,000,000			1,000,000		500,000				250,000	100,000	100,000	100,000		200,000	10,000	40,000		1,000,000	100,000	75,000	1,500,000	10,000		100,000	35,000	30,000	30,000	100,000	100,000		600,000	500,000	885,714	50,000			20,000	4,000					4,000	4,000	4,000																																																																		35,000
Common stock Issued for services one																																							500,000					10,000				200,000			600,000																																																																															240,000
Common stock Issued for services two																																							680,000																																																																																											10,000
Common stock fair value issued for services						39,000	585	33,000	100,000	23,000	3,388	715		855		520	75,000	1,598	140,000			80,000		55,000				37,500	25,000	18,000	19,000		40,000	2,000	10,000		1,240,000	170,000	144,750	2,895,000	19,400		200,000	68,250	53,100	45,000	180,000	178,000		210,000	175,000	55,357	3,125			5,000	1,000					1,000	1,000	1,000																																																																		68,250
Common stock fair value issued for services one																																							965,000					19,500				400,000			210,000																																																																															468,000
Common stock fair value issued for services two																																							1,312,400																																																																																											19,500
Commission on common stock																																																																																																																																		10.00%
Additional shares of common stock issued for an additional sponsorship commitment																																																																																																750,000																															1,000,000
Fair value of additional issued shares																																																																																																																															1,930,000
Per share value of additionaly issued shares																																																																																																																															$ 1.93
Shares held to be in escrow																																																																																																																															1,000,000
Shares delivered upon the execution of the agreement																																																																																													100,000	1,000,000	500,000	250,000																																			25,000
Annual fee for investor relations press release service																																																																																									14,250
Initial onetime fee for investor relations press release service																																																																																									250
Music compositions fee																																																																																									500
Music compositions fee for the first renewal year																																																																																									500
Music compositions fee for the second renewal year																																																																																									750
Additional renewal period for music composition agreement																																																																																									2 years
Stock exercisable per warrant																																																																																																																																					$ 0.50
Warrants issued based upon the number of shares (40,000 shares)																																																																																																																																					40,000
Agremment Cancellation date																																																																											Jan. 02, 2011																							Nov. 01, 2010
Percentage of fee paid in cash																																																																																																																																							10.00%
Percentage of dollar amount of securities purchased equal to fee paid																																																																																																																																							10.00%
Percentage of fee paid in warrants in addition																																																																																																																																							10.00%
Percentage of number of shares of stock purchased equal to fee in warrants																																																																																																																																							10.00%
Percentage of compensation for each gross dollar																																																																																																		100,000
Issuance of shares of common stock as a compensation																																																																																																		100,000
Required period to renew agreement																																																																																																		Three month intervals
Contract termination claims date																																																																																																	Feb. 17, 2011
Allowance for general expenses per month																																																																																						500
Percentage of compensation for each gross dollar																																																																																																	10.00%
Cancellation of additional shares of common stock issued for additional sponsorship commitment																																																																																																750,000
Allowance paid																																																																																												70
Allowance paid in cash																																																																																												50
Allowance paid in capital																																																																																												20
Non-cancelable operating lease period																																																																																																																																									3 years
Number of person with whom agreement made																																																																									5
Description of leasing arrangements, Operating Leases																																																																																																																																									The lease began on October 1, 2010 and expires on September 30, 2013
Lease expiration date																																																																																																																																										Sep. 30, 2013
Base rent due																																																																																																																																											$ 134,880

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Going Concern

6 Months Ended

Jun. 30, 2012

Going Concern [Abstract]

GOING CONCERN

NOTE 2             GOING CONCERN

As reflected in the accompanying financial statements, the Company is in the development stage with minimal operations, has an accumulated deficit of $15,794,251 for the period from December 9, 2005 (inception) to June 30, 2012, and has negative cash flow from operations of $2,646,452 from inception.  This raises substantial doubt about its ability to continue as a going concern.  The ability of the Company to continue as a going concern is dependent on the Company’s ability to raise additional capital and implement its business plan.  The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

Management believes that actions presently being taken to obtain additional funding and implement its strategic plans provide the opportunity for the Company to continue as a going concern.

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Convertible Debts (Details) (USD $)	12 Months Ended	6 Months Ended
	Dec. 31, 2011	Jun. 30, 2012 Fair Value Assumption 1 [Member]	Jun. 30, 2012 Fair Value Assumption Remeasurement 1 [Member]	Jun. 30, 2012 Fair Value Assumption 2 [Member]	Jun. 30, 2012 Fair Value Assumption Remeasurement 2 [Member]	Jun. 30, 2012 Fair Value Assumption 3 [Member]	Jun. 30, 2012 Fair Value Assumption Remeasurement 3 [Member]	Jun. 30, 2012 Fair Value Assumption 4 [Member]	Jun. 30, 2012 Fair Value Assumption Remeasurement 4 [Member]	Jun. 30, 2012 Fair Value Assumption 5 [Member]	Jun. 30, 2012 Fair Value Assumption Remeasurement 5 [Member]	Jun. 30, 2012 Fair Value Assumption 6 [Member]	Jun. 30, 2012 Fair Value Assumption Remeasurement 6 [Member]	Jun. 30, 2012 Fair Value Assumption 7 [Member]	Jun. 30, 2012 Fair Value Assumption Remeasurement 7 [Member]	Jun. 30, 2012 Fair Value Assumption 8 [Member]	Jun. 30, 2012 Fair Value Assumption Remeasurement 8 [Member]
Summary of assumptions used in measuring fair value
Exercise price		$ 0.1377	$ 0.0393	$ 0.0738	$ 0.035	$ 0.2629	$ 0.2331	$ 0.1490	$ 0.2080	$ 0.2077	$ 0.2240	$ 0.1797	$ 0.2240	$ 0.2030	$ 0.2240	$ 0.1647	$ 0.2240
Expected dividends		0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%
Expected volatility	436.04%	172.27%	471.81%	456.63%	514.06%	228.76%	233.04%	228.61%	233.04%	232.90%	233.04%	240.78%	233.04%	240.90%	233.04%	234.89%	233.04%
Expected term: conversion feature	3 years	267 days		365 days		365 days		280 days		268 days		365 days		60 days		278 days
Risk free interest rate	1.00%	0.32%	0.30%	0.27%	0.19%	0.18%	0.21%	0.21%	0.21%	0.19%	0.21%	0.18%	0.21%	0.18%	0.21%	0.19%	0.21%
Expected life of conversion feature in days			0 days		140 days		252 days		172 days		181 days		299 days		7 days		270 days

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Property and Equipment (Details Textual) (USD $)	6 Months Ended		79 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012
Property and Equipment (Textual)
Depreciation/amortization expense	$ 22,354	$ 19,136	$ 106,100

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Convertible Debts (Details Textual) (USD $)	3 Months Ended		6 Months Ended		79 Months Ended		6 Months Ended	12 Months Ended		12 Months Ended	6 Months Ended	12 Months Ended		12 Months Ended	6 Months Ended		6 Months Ended			6 Months Ended			6 Months Ended			6 Months Ended			6 Months Ended		6 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Dec. 31, 2011	Jun. 30, 2012 Fair Value Assumption 1 [Member]	Dec. 31, 2011 Fair Value Assumption 1 [Member]	Jul. 06, 2010 Fair Value Assumption 1 [Member]	Dec. 31, 2011 Fair Value Assumption Remeasurement 1 [Member]	Jun. 30, 2012 Fair Value Assumption 2 [Member]	Dec. 31, 2011 Fair Value Assumption 2 [Member]	Feb. 17, 2011 Fair Value Assumption 2 [Member]	Dec. 31, 2011 Fair Value Assumption Remeasurement 2 [Member]	Jun. 30, 2012 Fair Value Assumption 3 [Member]	Mar. 08, 2012 Fair Value Assumption 3 [Member]	Jun. 30, 2012 Fair Value Assumption Remeasurement 3 [Member]	Jun. 30, 2012 Fair Value Assumption 4 [Member]	Mar. 14, 2012 Fair Value Assumption 4 [Member]	Jun. 30, 2012 Fair Value Assumption Remeasurement 4 [Member]	Jun. 30, 2012 Fair Value Assumption 5 [Member]	Apr. 04, 2012 Fair Value Assumption 5 [Member]	Jun. 30, 2012 Fair Value Assumption Remeasurement 5 [Member]	Jun. 30, 2012 Fair Value Assumption 6 [Member]	Apr. 25, 2012 Fair Value Assumption 6 [Member]	Jun. 30, 2012 Fair Value Assumption Remeasurement 6 [Member]	Jun. 30, 2012 Fair Value Assumption 7 [Member]	May 08, 2012 Fair Value Assumption 7 [Member]	Jun. 30, 2012 Fair Value Assumption Remeasurement 7 [Member]	Apr. 25, 2012 Fair Value Assumption Remeasurement 7 [Member]	Jun. 30, 2012 Fair Value Assumption 8 [Member]	Jun. 22, 2012 Fair Value Assumption 8 [Member]	Jun. 30, 2012 Fair Value Assumption Remeasurement 8 [Member]
Convertible Debt (Textual)
Convertible notes payable									$ 50,000				$ 40,000			$ 166,667			$ 102,500			$ 166,000			$ 166,667		$ 111,000	$ 333,000			$ 62,500	$ 62,500
Discount on issuance of convertible notes																											33,000
Description of convertible notes maturity																											The note matures on May 8, 2013 and bears an interest rate of 0% if note is repaid on or before 90 days from the effective date
Maturity date of convertible notes payable							Mar. 30, 2011				Nov. 17, 2011				Mar. 09, 2013			Dec. 19, 2012			Dec. 28, 2012			Apr. 25, 2013			May 08, 2013				Mar. 27, 2013
Interest rate on convertible notes payable									8.00%				8.00%			4.00%			8.00%			8.00%			4.00%			5.00%				8.00%
Interest rate on unpaid amount of convertible notes payable							22.00%
Variable conversion price of market price, percentage							59.00%				59.00%				70.00%			65.00%			70.00%			70.00%			70.00%				65.00%
Market price description							Average of the lowest six trading prices for the Common Stock during the ten (10) trading day period prior to the conversion				Average of the lowest six (6) trading prices for the Common Stock during the ten trading day period prior to the conversion				Average of the lowest ten (10) trading prices for the common stock during the ten trading day period prior to the conversion			Average of the lowest three (3) trading prices for the common stock during the ten trading day period prior to the conversion			Average of the lowest three (3) trading prices for the common stock during the ten trading day period prior to the conversion			Average trading prices for the common stock during the ten trading day period prior to the conversion			Average of the lowest three (3) trading prices for the common stock during the fifteen (15) trading day period prior to the conversion				Average of the lowest three (3) trading prices for the common stock during the ten trading day period prior to the conversion
Proceeds from convertible notes payable							50,000				40,000				150,000			102,500			138,000			15,000			92,000				60,000
Finder fee on convertible note							3,000				2,500				16,667			2,500			28,000			16,667			8,000				2,500
Shares issued on conversion of converted notes payable								1,545,350				289,945
Note payable and accrued interest converted into stock								52,003				41,600
Fair value of the embedded conversion option							9,523		15,409				9,523		42,178			30,894			108,051			255,484			113,952				78,435
Debt discount	331,364		331,364		331,364		9,523		15,409				9,523		42,178			30,894			108,051			166,667			111,000			11,000	62,500
Amortization of debt discount	185,392	3,139	189,925	9,371	213,908		10,273	5,136							13,058			11,806			35,076			30,137			98,050				1,798
Derivative liability remeasured recorded a fair value										0				0			120,449			108,958			162,667			187,137			54,946				74,626
Change in fair value of derivative liability as income/loss										$ 13,262				$ 9,523			$ 78,271			$ 78,064			$ 54,616			$ 68,348			$ 59,006				$ 3,809

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Stockholders' Equity (Details) (Stock warrants [Member], USD $)	6 Months Ended	12 Months Ended
	Jun. 30, 2012	Dec. 31, 2011	Jun. 30, 2011
Stock warrants [Member]
Summary of option/ warrants activity
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number	2,715,800	1,760,000
Granted	200,000	955,800
Exercised
Forfieted
Ending balance	2,915,800	2,715,800
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Number	2,915,800
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price	$ 0.36	$ 0.51	$ 0.50
Weighted Average Exercise Price, Granted	$ 0.25	$ 0.10
Weighted Average Exercise Price, Exercised
Weighted Average Exercise Price, Forfieted
Weighted Average Exercise Price, Ending balance	$ 0.36	$ 0.36	$ 0.50
Weighted Average Exercise Price, Options Exercisable at June 30, 2012	$ 0.36
Weighted Average Fair Value of Options Granted	$ 0.36

XML

Summary of Significant Accounting Policies and Organization

6 Months Ended

Jun. 30, 2012

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION

NOTE 1             SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION

(A)  Organization and Basis of Presentation

Max Sound Corporation (the "Company") was incorporated in Delaware on December 9, 2005.  The Company is currently in the development stage, and on or around February 2011, the Company changed its business operations to focus primarily on developing and launching audio technology software.

Prior to February 2011, the Company's business operations were focused on creating search technologies within an online networking platform.

The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in The United States of America and the rules and regulations of the Securities and Exchange Commission for interim financial information.  Accordingly, they do not include all the information necessary for a comprehensive presentation of financial position and results of operations.

It is management's opinion, however, that all material adjustments (consisting of normal and recurring adjustments) have been made which are necessary for a fair financial statements presentation.  The results for the interim period are not necessarily indicative of the results to be expected for the year.

Activities during the development stage include developing the online networking platform, launching our audio technology, and raising capital.

Effective March 1, 2011, the Company filed with the State of Delaware a Certificate of Amendment of Certificate of Incorporation changing our name from So Act Network, Inc. to Max Sound Corporation.

(B) Use of Estimates

In preparing financial statements in conformity with generally accepted accounting principles, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reported period.  Actual results could differ from those estimates.

(C) Cash and Cash Equivalents

For purposes of the cash flow statements, the Company considers all highly liquid investments with original maturities of three months or less at the time of purchase to be cash equivalents.  As of June 30, 2012 and December 31, 2011, the Company had no cash equivalents.

(D) Property and Equipment

Property and equipment are stated at cost, less accumulated depreciation.  Expenditures for maintenance and repairs are charged to expense as incurred.  Depreciation is provided using the straight-line method over the estimated useful life of three to five years.

(E) Research and Development

The Company has adopted the provisions of FASB Accounting Standards Codification No. 350, Intangibles – Goodwill & Other.  Costs incurred in the planning stage of a website are expensed as research and development while costs incurred in the development stage are capitalized and amortized over the life of the asset, estimated to be three years.  Expenses subsequent to the launch have been expensed as website development expenses.

(F) Concentration of Credit Risk

The Company at times has cash in banks in excess of FDIC insurance limits. The Company had approximately $0 and $251,578 in excess of FDIC insurance limits as of June 30, 2012 and December 31, 2011, respectively.

(G) Revenue Recognition

The Company recognized revenue on arrangements in accordance with FASB Codification Topic 605, “Revenue Recognition” (“ASC Topic 605”).  Under ASC Topic 605, revenue is recognized only when the price is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting receivable is reasonably assured.  We had revenue of $0, and $0 for the six months ended June 30, 2012 and 2011, respectively.

(H) Advertising Costs

Advertising costs are expensed as incurred and include the costs of public relations activities.  These costs are included in consulting and general and administrative expenses and totaled $51,069 and $14,120 for the six months ended June 30, 2012 and 2011, respectively.

(I) Identifiable Intangible Assets

As of June 30, 2012 and December 31, 2011, $7,800,275 and $7,800,275, respectively of costs related to registering a trademark and acquiring technology rights have been capitalized.  It has been determined that the trademark and technology rights have an indefinite useful life and are not subject to amortization.  However, the trademark and technology rights will be reviewed for impairment annually or more frequently if impairment indicators arise.

(J) Impairment of Long-Lived Assets

The Company accounts for its long-lived assets in accordance with ASC Topic 360-10-05, “Accounting for the Impairment or Disposal of Long-Lived Assets.” ASC Topic 360-10-05 requires that long-lived assets, such as technology rights, be reviewed for impairment annually, or whenever events or changes in circumstances indicate that the historical cost carrying value of an asset may no longer be appropriate. The Company assesses recoverability of the carrying value of an asset by estimating the future net cash flows expected to result from the asset, including eventual disposition. If the future net cash flows are less than the carrying value of the asset, an impairment loss is recorded equal to the difference between the asset’s carrying value and fair value or disposable value. No impairments were recorded for six months ended June 30, 2012, and for the year ended December 31, 2011.

(K) Loss Per Share

In accordance with accounting guidance now codified as FASB ASC Topic 260, “Earnings per Share,”  Basic earnings per share (“EPS”) is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding during the period, excluding the effects of any potentially dilutive securities. Diluted EPS gives effect to all dilutive potential of shares of common stock outstanding during the period including stock options or warrants, using the treasury stock method (by using the average stock price for the period to determine the number of shares assumed to be purchased from the exercise of stock options or warrants), and convertible debt or convertible preferred stock, using the if-converted method. Diluted EPS excludes all dilutive potential of shares of common stock if their effect is anti-dilutive.  Because of the Company’s net losses, the effects of stock warrants and stock options would be anti-dilutive and accordingly, is excluded from the computation of earnings per share.  The number of such shares excluded from the computations of diluted loss per share totaled 2,915,800 and 1,760,000 for stock warrants, and 12,000,000 and 12,000,000 for stock options, and 3,278,976 and 282,532 shares issuable upon the conversion of convertible debt, for the six months ended June 30, 2012 and 2011, respectively.

(L) Income Taxes

The Company accounts for income taxes under FASB Codification Topic 740-10-25 (“ASC 740-10-25”) Income Taxes.  Under ASC 740-10-25, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases.  Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  Under ASC 740-10-25, 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.

The Company's federal income tax returns are no longer subject to examination by the IRS for the years prior to 2008, and the related state income tax returns are no longer subject to examination by state authorities for the years prior to 2008.

(M) Business Segments

The Company operates in one segment and therefore segment information is not presented.

(N) Recent Accounting Pronouncements

The Company's management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted would have a material impact on the accompanying financial statements.

(O) Fair Value of Financial Instruments

The carrying amounts on the Company’s financial instruments including prepaid expenses, accounts payable, accrued expenses, derivative liability, convertible note payable, and loan payable-related party, approximate fair value due to the relatively short period to maturity for these instruments.

(P) Stock-Based Compensation

In December 2004, the FASB issued FASB Accounting Standards Codification No. 718, Compensation – Stock Compensation.  Under FASB Accounting Standards Codification No. 718, companies are required to measure the compensation costs of share-based compensation arrangements based on the grant-date fair value and recognize the costs in the financial statements over the period during which employees are required to provide services. Share-based compensation arrangements include stock options, restricted share plans, performance-based awards, share appreciation rights and employee share purchase plans.  As such, compensation cost is measured on the date of grant at their fair value.  Such compensation amounts, if any, are amortized over the respective vesting periods of the option grant.  The Company applies this statement prospectively.

Equity instruments (“instruments”) issued to other than employees are recorded on the basis of the fair value of the instruments, as required by FASB Accounting Standards Codification No. 718.  FASB Accounting Standards Codification No. 505, Equity Based Payments to Non-Employees defines the measurement date and recognition period for such instruments.  In general, the measurement date is when either a (a) performance commitment, as defined, is reached or (b) the earlier of (i) the non-employee performance is complete or (ii) the instruments are vested. The measured value related to the instruments is recognized over a period based on the facts and circumstances of each particular grant as defined in the FASB Accounting Standards Codification.

(Q) Reclassification

Certain amounts from prior periods have been reclassified to conform to the current period presentation.  These reclassifications had no impact on the Company's net loss or cash flows.

(R) Derivative Financial Instruments

Fair value accounting requires bifurcation of embedded derivative instruments such as conversion features in convertible debt or equity instruments, and measurement of their fair value for accounting purposes.  In determining the appropriate fair value, the Company uses the Black-Scholes option-pricing model.  In assessing the convertible debt instruments, management determines if the convertible debt host instrument is conventional convertible debt and further if there is a beneficial conversion feature requiring measurement.  If the instrument is not considered conventional convertible debt, the Company will continue its evaluation process of these instruments as derivative financial instruments.

Once determined, derivative liabilities are adjusted to reflect fair value at each reporting period end, with any increase or decrease in the fair value being recorded in results of operations as an adjustment to fair value of derivatives.  In addition, the fair value of freestanding derivative instruments such as warrants, are also valued using the Black-Scholes option-pricing model.

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Stockholders' Equity (Details 1) (Warrant [Member], USD $)	6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Exercise Price Range 1 [Member]
Warrants outstanding and exercisable activity
Outstanding, Range of Exercise Price	$ 0.52	$ 0.52
Outstanding, Number Outstanding at June 30, 2012	500,000	500,000
Outstanding, Weighted Average Remaining Contractual Life	6 months	1 year 6 months
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Outstanding Options, Weighted Average Exercise Price	$ 0.52	$ 0.52
Exercisable, Number Exercisable at June 30, 2012	500,000	500,000
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Exercisable Options, Weighted Average Exercise Price	$ 0.52	$ 0.52
Exercise Price Range 2 [Member]
Warrants outstanding and exercisable activity
Outstanding, Range of Exercise Price	$ 0.50	$ 0.50
Outstanding, Number Outstanding at June 30, 2012	1,260,000	1,260,000
Outstanding, Weighted Average Remaining Contractual Life	10 months 6 days	11 months 26 days
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Outstanding Options, Weighted Average Exercise Price	$ 0.50	$ 0.50
Exercisable, Number Exercisable at June 30, 2012	1,260,000	1,260,000
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Exercisable Options, Weighted Average Exercise Price	$ 0.50	$ 0.50
Exercise Price Range 3 [Member]
Warrants outstanding and exercisable activity
Outstanding, Range of Exercise Price	$ 0.10
Outstanding, Number Outstanding at June 30, 2012	955,800
Outstanding, Weighted Average Remaining Contractual Life	2 years 2 months 1 day
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Outstanding Options, Weighted Average Exercise Price	$ 0.10
Exercisable, Number Exercisable at June 30, 2012	955,800
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Exercisable Options, Weighted Average Exercise Price	$ 0.10
Exercise Price Range 4 [Member]
Warrants outstanding and exercisable activity
Outstanding, Range of Exercise Price	$ 0.25
Outstanding, Number Outstanding at June 30, 2012	200,000
Outstanding, Weighted Average Remaining Contractual Life	2 years 11 months 12 days
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Outstanding Options, Weighted Average Exercise Price	$ 0.25
Exercisable, Number Exercisable at June 30, 2012	200,000
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Exercisable Options, Weighted Average Exercise Price	$ 0.25

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Subsequent Events (Details) (USD $)	6 Months Ended	1 Months Ended			1 Months Ended			1 Months Ended		1 Months Ended
	Jun. 30, 2012	Jul. 31, 2012 Agreement 1 [Member]	Jan. 15, 2013 Agreement 1 [Member]	Jul. 16, 2012 Agreement 1 [Member]	Jul. 31, 2012 Agreement 2 [Member]	Apr. 19, 2013 Agreement 2 [Member]	Sep. 19, 2012 Agreement 2 [Member]	Jul. 31, 2012 Agreement 3 [Member]	Jul. 30, 2012 Agreement 3 [Member]	Aug. 31, 2012 Agreement 4 [Member]	Aug. 03, 2012 Agreement 4 [Member]
Subsequent Event (Textual)
Convertible note				$ 58,333			$ 110,000		$ 111,000		$ 82,500
Debt Instrument, Maturity Date		Jan. 15, 2013			Apr. 19, 2013			Apr. 30, 2013		Aug. 03, 2013
Interest rate			10.00%			8.00%			8.00%		4.00%
Variable conversion price as percentage of market price		70.00%			70.00%			70.00%
Description of conversion price		The conversion price equals the "Variable Conversion Price", which is 70% of the "Market Price", which is the low traded price of the common stock during the twenty (20) trading day period prior to the conversion.			The conversion price equals the "Variable Conversion Price", which is 70% of the "Market Price", which is the average of the lowest three (3) trading prices for the common stock during the ten (10) trading day period prior to the conversion.			The conversion price equals the "Variable Conversion Price", which is 70% of the "Market Price", which is the average of the lowest three (3) trading prices for the common stock during the ten (10) trading day period prior to the conversion.		The conversion price equals the "Variable Conversion Price", which is 70% of the "Market Price", which is the average of the lowest three (3) trading prices for the common stock during the ten (10) trading day period prior to the conversion.
Stock issued to employee as per employment agreement in July and August	125,000

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Condensed Balance Sheets (USD $)	Jun. 30, 2012	Dec. 31, 2011
Current Assets
Cash	$ 114,903	$ 516,532
Prepaid expenses	26,805	23,659
Debt offering costs - net	43,954
Total Current Assets	185,662	540,191
Property and equipment, net	221,046	146,000
Other Assets
Security deposit	413	413
Intangible assets	7,800,275	7,800,275
Total Other Assets	7,800,688	7,800,688
Total Assets	8,207,396	8,486,879
Current Liabilities
Accounts payable	38,600	25,470
Accrued expenses	74,812	165,897
Derivative liability	708,783
Convertible note payable, net of debt discount of $331,364	443,970
Total Current Liabilities	1,266,165	191,367
Commitments and Contingencies
Stockholders' Equity
Preferred stock, $0.0001 par value; 10,000,000 shares authorized, No shares issued and outstanding
Common stock, $0.0001 par value; 400,000,000 shares authorized, 255,335,394 and 255,184,661 shares issued and outstanding, respectively	25,534	25,519
Additional paid-in capital	22,709,948	22,629,977
Deficit accumulated during the development stage	(15,794,251)	(14,359,984)
Total Stockholders' Equity	6,941,231	8,295,512
Total Liabilities and Stockholders' Equity	$ 8,207,396	$ 8,486,879

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Condensed Statement of Changes in Stockholders' Equity (Unaudited) (Parenthetical) (USD $)	6 Months Ended	12 Months Ended
	Jun. 30, 2012	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009	Dec. 31, 2008
Statement Of Stockholders Equity [Abstract]
Common stock issued for services to founder ($0.001/sh)					$ 0.001
Common stock issued for cash ($0.25/sh), fair market value			$ 0.25	$ 0.25	$ 0.25
Common stock issued for services ($0.25/sh), fair market value			$ 0.25	$ 0.25	$ 0.25
Common stock issued for services ($0.35/sh), fair market value				$ 0.35
Common stock issued for services ($0.0625/sh), fair market value				$ 0.0625
Common stock issued for services ($1.50/sh), fair market value				$ 1.50
Common stock issued for services ($1.77/sh), fair market value				$ 1.77
Common stock issued for services ($1.78/sh), fair market value				$ 1.78
Common stock issued for services ($1.80/sh), fair market value				$ 1.80
Common stock issued for services ($1.93/sh), fair market value				$ 1.93
Common stock issued for services ($1.94/sh), fair market value				$ 1.94
Common stock issued for services ($1.95/sh), fair market value				$ 1.95
Common stock issued for services ($2.00/sh), fair market value				$ 2.00
Return of common stock issued for services ($0.35/sh), fair market value				$ 0.35
Accrued salary conversion into common stock ($0.30/sh), fair market value			$ 0.30
Common stock issued for services ($0.15/sh), fair market value			$ 0.15
Common stock issued for services ($0.18/sh), fair market value			$ 0.18
Common stock issued for services ($0.19/sh), fair market value			$ 0.19
Common stock issued for services ($0.20/sh), fair market value			$ 0.20
Common stock issued in exchange for technology rights ($0.25/sh), fair market value			$ 0.25
Return of common stock issued for services ($1.05/sh), fair market value			$ 1.05
Common stock issued for services ($1.24/Sh), fair market value			$ 1.24
Common stock issued for services ($1.70/sh), fair market value			$ 1.70
Cancellation of shares held in escrow ($1.93/sh), fair market value			$ 1.93
Common stock issued in exchange for assets ($.10/sh)		$ 0.10
Convertible debt conversion into common stock ($0.032/sh), fair market value		$ 0.032
Convertible debt conversion into common stock ($0.0295/sh), fair market value		$ 0.0295
Convertible debt conversion into common stock ($0.0336/sh), fair market value		$ 0.0336
Convertible debt conversion into common stock ($0.0454/sh), fair market value		$ 0.0454
Common stock issued for services ($.10/sh), fair market value		$ 0.10
Common stock issued for services ($0.11/sh), fair market value		$ 0.11
Common stock issued for services ($0.08/sh), fair market value		$ 0.08
Accrued salary conversion into common stock ($0.11/sh), fair market value		$ 0.11
Line of credit conversion into common stock ($0.11/sh), fair market value		$ 0.11
Common stock issued for cash ($0.10/sh), fair market value		$ 0.10
Convertible debt conversion into common stock ($0.0315/sh), fair market value		$ 0.0315
Common stock issued for services ($0.07/sh), fair market value		$ 0.07
Common stock issued for services (0.22sh), fair market value		$ 0.22
Common stock issued for services (0.23sh), fair market value		$ 0.23
Common stock issued for services (0.33sh), fair market value		$ 0.33
Common stock issued for services (0.39sh), fair market value		$ 0.39
Common stock issued for services (0.47sh), fair market value		$ 0.47
Common stock issued for services (0.50sh), fair market value		$ 0.50
Common stock issued for services (0.54sh), fair market value		$ 0.54
Common stock issued for services (0.70sh), fair market value		$ 0.70
Common stock issued for services (0.88sh), fair market value		$ 0.88
Convertible debt conversion into common stock (0.1339sh), fair market value		$ 0.1339
Convertible debt conversion into common stock (0.1455sh), fair market value		$ 0.1455
Convertible debt conversion into common stock (0.1554sh), fair market value		$ 0.1554
Common stock issued for services (0.62sh), fair market value	$ 0.62
Common stock issued for services (0.21sh), fair market value	$ 0.21

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Stockholders' Equity (Details Textual) (USD $)	1 Months Ended					3 Months Ended			6 Months Ended		12 Months Ended			79 Months Ended																																																								1 Months Ended					12 Months Ended																																													12 Months Ended																											12 Months Ended													12 Months Ended								12 Months Ended		12 Months Ended				12 Months Ended
	Jun. 30, 2011	Aug. 31, 2010	Jul. 31, 2010	May 31, 2010	Feb. 28, 2009	Jun. 30, 2012	Sep. 30, 2011	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009	Jun. 30, 2012	Aug. 31, 2012	Jul. 31, 2012	Sep. 27, 2011	Sep. 25, 2011	Sep. 24, 2011	Sep. 21, 2011	Sep. 19, 2011	Sep. 18, 2011	Sep. 12, 2011	Aug. 31, 2011	Aug. 14, 2011	Jul. 31, 2011	Jul. 01, 2011	Jun. 15, 2011	May 17, 2011	May 02, 2011	Mar. 21, 2011	Mar. 03, 2011	Feb. 23, 2011	Feb. 17, 2011	Jan. 24, 2011	Jan. 17, 2011	Dec. 14, 2010	Nov. 01, 2010	Oct. 01, 2010	Aug. 05, 2010	Jul. 23, 2010	May 27, 2010	Feb. 17, 2010	Jan. 15, 2010	Dec. 30, 2009	Dec. 27, 2009	Dec. 15, 2009	Dec. 03, 2009	Nov. 21, 2009	Nov. 18, 2009	Nov. 16, 2009	Nov. 12, 2009	Sep. 21, 2009	Sep. 18, 2009	Aug. 31, 2009	Aug. 25, 2009	Jan. 31, 2009	Jan. 15, 2009	Jan. 14, 2009	Jan. 12, 2009	Jan. 11, 2009	Jan. 03, 2009	Jan. 02, 2009	Dec. 31, 2008	Dec. 20, 2008	Dec. 05, 2008	Nov. 24, 2008	Oct. 14, 2008	Dec. 31, 2005	Sep. 30, 2011 Consulting services [Member]	Jul. 31, 2010 Consulting services [Member]	Jun. 30, 2010 Consulting services [Member]	May 31, 2010 Consulting services [Member]	Aug. 31, 2009 Consulting services [Member]	Dec. 31, 2011 Consulting services [Member]	Dec. 31, 2009 Consulting services [Member]	Jun. 30, 2012 Consulting services [Member]	Jan. 25, 2012 Consulting services [Member]	Dec. 18, 2011 Consulting services [Member]	Nov. 18, 2011 Consulting services [Member]	Oct. 31, 2011 Consulting services [Member]	Oct. 28, 2011 Consulting services [Member]	Sep. 27, 2011 Consulting services [Member]	Sep. 25, 2011 Consulting services [Member]	Sep. 24, 2011 Consulting services [Member]	Sep. 21, 2011 Consulting services [Member]	Sep. 19, 2011 Consulting services [Member]	Sep. 18, 2011 Consulting services [Member]	Sep. 12, 2011 Consulting services [Member]	Aug. 14, 2011 Consulting services [Member]	Jul. 01, 2011 Consulting services [Member]	Jun. 15, 2011 Consulting services [Member]	Jun. 10, 2011 Consulting services [Member]	May 17, 2011 Consulting services [Member]	Mar. 03, 2011 Consulting services [Member]	Feb. 17, 2011 Consulting services [Member]	Jan. 17, 2011 Consulting services [Member]	Dec. 14, 2010 Consulting services [Member]	Nov. 01, 2010 Consulting services [Member]	Oct. 01, 2010 Consulting services [Member]	Aug. 31, 2010 Consulting services [Member]	Jul. 23, 2010 Consulting services [Member]	Jun. 02, 2010 Consulting services [Member]	Jan. 15, 2010 Consulting services [Member]	Dec. 27, 2009 Consulting services [Member]	Dec. 15, 2009 Consulting services [Member]	Dec. 03, 2009 Consulting services [Member]	Nov. 21, 2009 Consulting services [Member]	Nov. 18, 2009 Consulting services [Member]	Nov. 16, 2009 Consulting services [Member]	Nov. 12, 2009 Consulting services [Member]	Sep. 21, 2009 Consulting services [Member]	Sep. 18, 2009 Consulting services [Member]	Jan. 14, 2009 Consulting services [Member]	Jan. 12, 2009 Consulting services [Member]	Dec. 20, 2008 Consulting services [Member]	Dec. 05, 2008 Consulting services [Member]	Nov. 24, 2008 Consulting services [Member]	Oct. 14, 2008 Consulting services [Member]	Dec. 31, 2009 Consulting services [Member] September 21, 2009 [Member]	Dec. 31, 2009 Consulting services [Member] September 18, 2009 [Member]	Dec. 31, 2011 Consulting services [Member] November 12, 2009 [Member]	Dec. 31, 2010 Consulting services [Member] November 12, 2009 [Member]	Dec. 31, 2009 Consulting services [Member] November 12, 2009 [Member]	Dec. 31, 2011 Consulting services [Member] November 16, 2009 [Member]	Dec. 31, 2010 Consulting services [Member] November 16, 2009 [Member]	Dec. 31, 2009 Consulting services [Member] November 16, 2009 [Member]	Dec. 31, 2010 Consulting services [Member] November 18, 2009 [Member]	Dec. 31, 2009 Consulting services [Member] November 18, 2009 [Member]	Dec. 31, 2010 Consulting services [Member] November 21, 2009 [Member]	Dec. 31, 2009 Consulting services [Member] December 3, 2009 [Member]	Dec. 31, 2010 Consulting services [Member] December 15, 2009 [Member]	Dec. 31, 2009 Consulting services [Member] December 15, 2009 [Member]	Dec. 31, 2010 Consulting services [Member] December 27, 2009 [Member]	Dec. 31, 2011 Consulting services [Member] December 31, 2009 [Member]	Dec. 31, 2010 Consulting services [Member] December 31, 2009 [Member]	Dec. 31, 2011 Consulting services [Member] January 15, 2010 [Member]	Dec. 31, 2010 Consulting services [Member] January 15, 2010 [Member]	Aug. 25, 2009 Professional services [Member]	Jan. 14, 2009 Professional services [Member]	Feb. 17, 2010 Consulting Agreement 2 [Member]	Dec. 31, 2009 Consulting Agreement 2 [Member]	Dec. 27, 2009 Consulting Agreement 2 [Member]	Dec. 03, 2009 Consulting Agreement 2 [Member]	Nov. 12, 2009 Consulting Agreement 2 [Member]	Sep. 18, 2009 Consulting Agreement 2 [Member]	Dec. 31, 2009 Consulting Agreement 2 [Member] September 18, 2009 [Member]	Dec. 31, 2011 Consulting Agreement 2 [Member] November 12, 2009 [Member]	Dec. 31, 2010 Consulting Agreement 2 [Member] November 12, 2009 [Member]	Dec. 31, 2009 Consulting Agreement 2 [Member] November 12, 2009 [Member]	Dec. 31, 2009 Consulting Agreement 2 [Member] December 3, 2009 [Member]	Dec. 31, 2010 Consulting Agreement 2 [Member] December 27, 2009 [Member]	Dec. 31, 2011 Consulting Agreement 2 [Member] December 31, 2009 [Member]	Dec. 31, 2010 Consulting Agreement 2 [Member] December 31, 2009 [Member]	Dec. 31, 2011 Consulting Agreement 2 [Member] February 17, 2010 [Member]	Dec. 31, 2010 Consulting Agreement 2 [Member] February 17, 2010 [Member]	Dec. 31, 2009 Consulting Services Agreement 3 [Member]	Dec. 27, 2009 Consulting Services Agreement 3 [Member]	Dec. 03, 2009 Consulting Services Agreement 3 [Member]	Dec. 31, 2009 Consulting Services Agreement 3 [Member] December 3, 2009 [Member]	Dec. 31, 2010 Consulting Services Agreement 3 [Member] December 27, 2009 [Member]	Dec. 31, 2010 Consulting Services Agreement 3 [Member] December 31, 2009 [Member]	Dec. 31, 2011 Consulting Services Agreement 3 [Member] December 2009 [Member]	Dec. 31, 2010 Consulting Services Agreement 3 [Member] December 2009 [Member]	Dec. 31, 2009 Consulting Services Agreement 3 [Member] December 2009 [Member]	Dec. 31, 2009 Consulting Services Agreement 4 [Member]	Dec. 03, 2009 Consulting Services Agreement 4 [Member]	Dec. 31, 2009 Consulting Services Agreement 4 [Member] December 3, 2009 [Member]	Dec. 31, 2009 Consulting Services Agreement 5 [Member]	Dec. 31, 2011 Consulting Services Agreement 5 [Member] December 2009 One [Member]	Dec. 31, 2010 Consulting Services Agreement 5 [Member] December 2009 One [Member]	Dec. 31, 2009 Consulting Services Agreement 5 [Member] December 2009 One [Member]	Dec. 30, 2009 Advertising Agreement [Member]	Dec. 31, 2010 Advertising Agreement [Member] December 30, 2009 [Member]
Stockholders' Equity (Textual)
Common shares issued						255,335,394			255,335,394		255,184,661			255,335,394	125,000	125,000														2,000,000	150,000		300,000		10,000	12,000,000																						4,000		2,000	32,000	2,000	20,000						100,000	50,482	200,000			885,714	200,000	75,000	150,000	733	100,000	100,000	123,795	100,000	100,000	1,500	100,000	400,000	100,000	15,403	2,860	2,443	6,500	15,980	300,000	2,000,000	1,000,000	500,000	3,000,000	250,000	100,000	100,000	100,000	10,000	40,000	100,000	10,000	100,000	240,000	30,000	30,000	100,000	100,000	600,000	500,000	20,000	4,000	4,000	4,000	4,000	44,900,000																				50,000	50,000	1,000,000	75,000	10,000	35,000	200,000	600,000											500,000	10,000	35,000							680,000	10,000		600,000				1,500,000
Value of common stock issue						$ 25,534			$ 25,534		$ 25,519			$ 25,534										$ 1,093,700						$ 200,000	$ 15,000		$ 30,000		$ 1,000																							$ 1,000		$ 500	$ 8,000	$ 500	$ 5,000	$ 118,250					$ 100					$ 62,000																																					$ 178,000	$ 210,000		$ 5,000	$ 1,000	$ 1,000	$ 1,000	$ 1,000	$ 44,900																				$ 3,125	$ 3,125					$ 400,000
Common stock, par value	$ 0.10					$ 0.0001	$ 0.10	$ 0.10	$ 0.0001	$ 0.10	$ 0.0001			$ 0.0001										$ 0.10						$ 0.10	$ 0.10		$ 0.10		$ 0.10					$ 0.25	$ 0.25	$ 0.25																$ 0.25		$ 0.25	$ 0.25	$ 0.25	$ 0.25	$ 0.25					$ 0.001	$ 0.10	$ 0.20			$ 0.0625	$ 0.54	$ 1.93	$ 0.21	$ 0.62	$ 0.50	$ 0.70	$ 0.47	$ 0.88	$ 0.22	$ 0.39	$ 0.33	$ 0.25	$ 0.23	$ 0.22	$ 0.25	$ 0.35	$ 0.08	$ 0.10	$ 0.25	$ 0.07	$ 0.08	$ 0.11	$ 0.10	$ 0.15	$ 0.25	$ 0.18	$ 0.19	$ 0.20	$ 0.25	$ 1.70	$ 1.94	$ 2.00	$ 1.95	$ 1.77	$ 1.50	$ 1.80	$ 1.78	$ 0.35	$ 0.35	$ 0.25	$ 0.25	$ 0.25	$ 0.25	$ 0.25	$ 0.001																				$ 0.0625	$ 0.0625	$ 1.24	$ 1.93	$ 1.94	$ 1.95	$ 2.00	$ 0.35											$ 1.93	$ 1.94	$ 1.95							$ 1.93	$ 1.95		$ 1.95				$ 1.93
Common stock par value due to forward split																																																									$ 0.0625	$ 0.0625	$ 0.0625	$ 0.0625	$ 0.0625	$ 0.0625	$ 0.0625	$ 0.0625	$ 0.0625	$ 0.0625	$ 0.0625	$ 0.00025																																														$ 0.0625	$ 0.0625	$ 0.0625	$ 0.0625	$ 0.0625	$ 0.00025
Common stock issued during period	5,460,000						10,937,000						473,000
Value of common stock issued during period											1,885,700
Common stock subscription received																										397,000																															67,750							67,750
Direct offering costs					850							2,900,000
Number of warrants issued in one unit																																								100,000	100,000	100,000
Number of common stock issued in one unit																																								100,000	100,000	100,000
Stock issued value issued for cash net of the finder’s fee																																								250,000	25,000	22,500
Finder's fee											76,780																															2,500
Number of units issued by the company																																								10	1	1
Warrants exercise price		$ 0.50	$ 0.50	$ 0.50																																																																							$ 0.10	$ 0.52
Term of warrants			3 years	3 years																																																																							3 years	3 years
Amount of Subscription receivable	397,000
Number of warrants issued by the company											955,800	1,200,000																																																										955,800	10,000	40,000	10,000			500,000
Number of common stock issued for services	300,000	100,000	200,000	40,000				300,000		300,000			75,000				100,000	1,500	100,000	400,000	100,000	15,403	2,860		2,443		6,500	15,980	2,000,000			1,000,000		500,000			250,000	100,000	100,000		10,000		1,000,000	100,000	1,500,000	10,000	100,000	35,000	30,000	30,000	100,000	100,000	600,000	500,000	885,714	50,000			20,000	4,000					4,000	4,000	4,000
Fair market value of common stock																																																																						5,048	40,000			55,357	108,000	144,750	31,500	455	50,000	70,000	58,184	88,000	39,000	585,000	33,000	100,000	23,000	3,388	715	855	520	1,598	75,000	140,000	80,000	55,000	300,000	37,500	25,000	18,000	19,000	2,000	10,000	170,000	19,400	200,000	468,000	53,100	45,000	180,000			175,000																												1,240,000	144,750	19,400	68,250		210,000											965,000	19,400	68,250							1,312,400	19,500		1,170,000				2,895,000
Gain on extinguishment of debt														6,643																																																												6,643,000
Number of common shares returned back after cancellation of agreement																																																																																																																400,000	300,000																																	400,000																												1,000,000
Deferred compensation											0		105,000																																																																																																			140,000	105,000																								0									140,000																	0							0
Services expense											1,199,794																																																																																																													70,000	70,000	77,052	89,000	11,948	78,904	90,000	11,096	39,699	5,301	53,100	468,000	128,889	71,111	19,400	28,376	116,374	88,493	81,507									70,000	177,534	200,000	22,466	68,250	19,400	28,376	116,374	173,260	1,066,740				68,250	19,400	965,000	600,482	709,116	2,802			19,500		550,808	585,000	34,192		965,000
Reclassification of deferred compensation													$ 0																																																																																																	$ 0	$ 0	$ 0	$ 0																																$ 0	$ 0
Restriction free shares after agreement									6
Number of shares allow to employee for sell									250,000
Period for sell of shares									2 years
Additional benefit on shares									150,000

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Stockholders' Equity (Tables)

6 Months Ended

Jun. 30, 2012

Equity [Abstract]

Summary of warrants activity

	Number of Warrants		Weighted Average Exercise Price
Stock Warrants
Balance at December 31, 2010		1,760,000	$	0.51
Granted		955,800		0.10
Exercised
Forfeited
Balance at December 31, 2011		2,715,800	$	0.36
Granted		200,000	$	0.25
Exercised		-
Forfeited		-
Balance at June 30, 2012		2,915,800	$	0.36
Options Exercisable at June 30, 2012		2,915,800	$	0.36
Weighted Average Fair Value of Options Granted			$	0.36

Warrants Outstanding								Warrants Exercisable
Range of Exercise Price		Number Outstanding at June 30, 2012		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price		Number Exercisable at June 30, 2012		Weighted Average Exercise Price
$	0.52		500,000		0.50	$	0.52		500,000	$	0.52
$	0.50		1,260,000		0.85	$	0.50		1,260,000	$	0.50
$	0.10		955,800		2.17	$	0.10		955,800	$	0.10
$	0.25		200,000		2.95	$	0.25		200,000	$	0.25

Warrants Outstanding								Warrants Exercisable
Range of Exercise Price		Number Outstanding at June 30, 2011		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price		Number Exercisable at June 30, 2011		Weighted Average Exercise Price
$	0.52		500,000		1.50	$	0.52		500,000	$	0.52
$	0.50		1,260,000		1.99	$	0.50		1,260,000	$	0.50

Summary of option activity

	Number of Options		Weighted Average Exercise Price
Stock Options
Balance at December 31, 2011		12,000,000	$	0.12
Granted		-	$	-
Exercised		-
Forfeited		-
Balance at June 30, 2012		12,000,000	$	0.12
Options Exercisable at June 30, 2012		12,000,000	$	0.12
Weighted Average Fair Value of Options Granted			$	0.12

Options Outstanding								Options Exercisable
Range of Exercise Price		Number Outstanding at June 30, 2012		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price		Number Exercisable at June 30, 2012		Weighted Average Exercise Price
$	0.12		12,000,000		1.55	$	0.12		12,000,000	$	0.12

Options Outstanding								Options Exercisable
Range of Exercise Price		Number Outstanding at June 30, 2011		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price		Number Exercisable at June 30, 2011		Weighted Average Exercise Price
$	-		-		-	$	-		-	$	-

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Stockholders' Equity (Details Textual 1) (USD $)	1 Months Ended								3 Months Ended	6 Months Ended		12 Months Ended																																3 Months Ended	12 Months Ended				1 Months Ended				12 Months Ended																																														12 Months Ended			6 Months Ended
	Sep. 30, 2011	Aug. 31, 2011	Apr. 30, 2011	Feb. 28, 2011	Jan. 31, 2011	Aug. 31, 2010	Jul. 31, 2010	May 31, 2010	Dec. 31, 2008	Jun. 30, 2012	Jun. 30, 2011	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009	Dec. 31, 2008	Aug. 31, 2012	Jul. 31, 2012	May 02, 2011	Mar. 21, 2011	Feb. 23, 2011	Feb. 17, 2011	Jan. 24, 2011	Jan. 17, 2011	Sep. 20, 2010	Aug. 05, 2010	Jul. 23, 2010	Jun. 02, 2010	May 27, 2010	Jan. 31, 2009	Jan. 27, 2009	Jan. 15, 2009	Jan. 14, 2009	Jan. 12, 2009	Jan. 11, 2009	Jan. 03, 2009	Jan. 02, 2009	Dec. 20, 2008	Dec. 05, 2008	Nov. 24, 2008	Oct. 14, 2008	Dec. 31, 2005	May 11, 2010 Max Audio Technology [Member]	Jan. 17, 2011 Blog Software, Social Media Vault, Social Media Bar and Trending Topix (BSST) [Member]	Dec. 31, 2008 Principal Owner [Member]	Dec. 31, 2010 Principal Owner [Member]	Dec. 31, 2009 Principal Owner [Member]	Feb. 17, 2011 Principal Owner [Member]	Jun. 02, 2010 Principal Owner [Member]	Sep. 30, 2011 Consulting services [Member]	Jul. 31, 2010 Consulting services [Member]	Jun. 30, 2010 Consulting services [Member]	May 31, 2010 Consulting services [Member]	Dec. 31, 2011 Consulting services [Member]	Dec. 31, 2009 Consulting services [Member]	Jun. 30, 2012 Consulting services [Member]	Jan. 25, 2012 Consulting services [Member]	Dec. 18, 2011 Consulting services [Member]	Nov. 18, 2011 Consulting services [Member]	Oct. 31, 2011 Consulting services [Member]	Oct. 28, 2011 Consulting services [Member]	Sep. 27, 2011 Consulting services [Member]	Sep. 25, 2011 Consulting services [Member]	Sep. 24, 2011 Consulting services [Member]	Sep. 21, 2011 Consulting services [Member]	Sep. 19, 2011 Consulting services [Member]	Sep. 18, 2011 Consulting services [Member]	Sep. 12, 2011 Consulting services [Member]	Aug. 14, 2011 Consulting services [Member]	Jul. 01, 2011 Consulting services [Member]	Jun. 15, 2011 Consulting services [Member]	Jun. 10, 2011 Consulting services [Member]	May 17, 2011 Consulting services [Member]	Mar. 03, 2011 Consulting services [Member]	Feb. 17, 2011 Consulting services [Member]	Jan. 17, 2011 Consulting services [Member]	Dec. 14, 2010 Consulting services [Member]	Nov. 01, 2010 Consulting services [Member]	Oct. 01, 2010 Consulting services [Member]	Aug. 31, 2010 Consulting services [Member]	Jul. 23, 2010 Consulting services [Member]	Jun. 02, 2010 Consulting services [Member]	Jan. 15, 2010 Consulting services [Member]	Dec. 27, 2009 Consulting services [Member]	Dec. 15, 2009 Consulting services [Member]	Dec. 03, 2009 Consulting services [Member]	Nov. 21, 2009 Consulting services [Member]	Nov. 18, 2009 Consulting services [Member]	Nov. 16, 2009 Consulting services [Member]	Nov. 12, 2009 Consulting services [Member]	Sep. 21, 2009 Consulting services [Member]	Sep. 18, 2009 Consulting services [Member]	Aug. 31, 2009 Consulting services [Member]	Jan. 14, 2009 Consulting services [Member]	Jan. 12, 2009 Consulting services [Member]	Dec. 20, 2008 Consulting services [Member]	Dec. 05, 2008 Consulting services [Member]	Nov. 24, 2008 Consulting services [Member]	Oct. 14, 2008 Consulting services [Member]	Dec. 31, 2010 Consulting services [Member] Warrants issued on June 1, 2010	Dec. 31, 2010 Consulting services [Member] Warrants issued on July 23, 2010	Dec. 31, 2010 Consulting services [Member] Warrants issued on May 27, 2010	Jun. 30, 2012 Consulting agreement [Member]	Dec. 27, 2009 Consulting agreement [Member]	Dec. 15, 2009 Consulting agreement [Member]
Stockholders' Equity Additional (Textual)
Number of warrants issued by the company												955,800	1,200,000																																				955,800	10,000	40,000	10,000		500,000																																																200,000
Expense recognized on issuance of warrants																																																					$ 248,498	$ 823,077																																													$ 7,184	$ 1,593	$ 1,782	$ 48,031
Assumed expected dividend yield for Black-Scholes option pricing model																																																					0	0																																													0	0	0	0
Assumed expected volatility rate for Black-Scholes option pricing model												436.04%																																									461.11%	112.80%																																													145.70%	172.90%	152.80%	237.76%
Assumed risk free interest rate for Black-Scholes option pricing model												1.00%																																									0.33%	1.65%																																													1.26%	0.94%	1.35%	0.19%
Assumed expected term for Black-Scholes option pricing model												3 years																																									3 years	3 years																																													3 years	3 years	3 years	3 years
Term of warrants							3 years	3 years																																													3 years	3 years																																													3 years	3 years	3 years	3 years
Warrants exercise price						$ 0.50	$ 0.50	$ 0.50																																													$ 0.10	$ 0.52																																													$ 0.50	$ 0.50	$ 0.50	$ 0.25
Common shares issued										255,335,394		255,184,661				125,000	125,000	2,000,000	150,000	300,000		10,000	12,000,000								4,000		2,000	32,000	2,000	20,000					100,000	30,000,000	3,000,000						50,482	200,000			200,000	75,000	150,000	733	100,000	100,000	123,795	100,000	100,000	1,500	100,000	400,000	100,000	15,403	2,860	2,443	6,500	15,980	300,000	2,000,000	1,000,000	500,000	3,000,000	250,000	100,000	100,000	100,000	10,000	40,000	100,000	10,000	100,000	240,000	30,000	30,000	100,000	100,000	600,000	500,000	885,714	20,000	4,000	4,000	4,000	4,000	44,900,000
Common stock, $0.0001 par value; 400,000,000 shares authorized, 255,335,394 and 255,184,661 shares issued and outstanding, respectively		1,093,700							118,250	25,534		25,519			118,250			200,000	15,000	30,000		1,000									1,000		500	8,000	500	5,000					100	7,500,000	300,000																																														178,000	210,000		62,000	5,000	1,000	1,000	1,000	1,000	44,900					19,400	200,000
Common stock, par value	$ 0.10	$ 0.10							$ 0.25	$ 0.0001	$ 0.10	$ 0.0001			$ 0.25			$ 0.10	$ 0.10	$ 0.10		$ 0.10			$ 0.25	$ 0.25		$ 0.25			$ 0.25		$ 0.25	$ 0.25	$ 0.25	$ 0.25					$ 0.001	$ 0.25	$ 0.10						$ 0.10	$ 0.20			$ 0.54	$ 1.93	$ 0.21	$ 0.62	$ 0.50	$ 0.70	$ 0.47	$ 0.88	$ 0.22	$ 0.39	$ 0.33	$ 0.25	$ 0.23	$ 0.22	$ 0.25	$ 0.35	$ 0.08	$ 0.10	$ 0.25	$ 0.07	$ 0.08	$ 0.11	$ 0.10	$ 0.15	$ 0.25	$ 0.18	$ 0.19	$ 0.20	$ 0.25	$ 1.70	$ 1.94	$ 2.00	$ 1.95	$ 1.77	$ 1.50	$ 1.80	$ 1.78	$ 0.35	$ 0.35	$ 0.0625	$ 0.25	$ 0.25	$ 0.25	$ 0.25	$ 0.25	$ 0.001
In kind contribution of rent - related party													9,450	12,600																														2,913	9,450	12,600
Number of common shares after forward split									1,892,000						1,892,000														1,892,000		16,000	80,000	16,000	128,000	8,000	80,000	16,000	16,000	16,000		400,000																																																				80,000	16,000	16,000	16,000	16,000	179,600,000
Convertible debt conversion into common stock ($0.1455/sh) (Shares)		96,220
Convertible debt conversion into common stock ($0.1339/sh) (Shares)	116,505
Stockholders' Equity Additional (Textual 2)
Warrant outstanding										2,915,800	1,760,000
Warrants reserved for future										2,915,800
Shares for forward split									473,000						473,000																4,000		4,000	32,000	2,000	20,000	4,000	4,000	4,000	44,900,000	100,000
Stockholders' equity, stock split										four-for-one
Number of common shares after amendment																								400,000,000			295,000,000			250,000,000
Par value per common shares after amendment																								$ 0.0001			$ 0.001			$ 0.001
Number of preferred shares after amendment																														10,000,000
Par value per preferred share after amendment																														$ 0.001
Operating expenses paid by former stockholder									4,400
Amount of accrued compensation converted into shares																					144,000						283,652																				144,000	283,652
Number of common shares converted form accrued compensation																					1,309,091						945,507																				1,309,091	945,507
Par value of share converted form accrued compensation																					$ 0.11						$ 0.30																				$ 0.11	$ 0.30
Amount of line of credit owed converted into shares																					100,000
Number of common shares converted form line of credit owed																					909,091
Convertible debt conversion into common stock ($0.032/sh) (Shares)					109,375
Convertible debt conversion into common stock ($0.032/sh), fair market value					$ 0.032							$ 0.032
Convertible debt conversion into common stock ($0.0295/sh) (Shares)				271,186
Convertible debt conversion into common stock ($0.0295/sh), fair market value				$ 0.0295								$ 0.0295
Convertible debt conversion into common stock ($0.0336/sh) (Shares)				357,143
Convertible debt conversion into common stock ($0.0336/sh), fair market value				$ 0.0336								$ 0.0336
Convertible debt conversion into common stock ($0.0454/sh) (Shares)				220,264
Convertible debt conversion into common stock ($0.0454/sh), fair market value				$ 0.0454								$ 0.0454
Convertible debt conversion into common stock ($0.0315/sh) (Shares)			587,382
Convertible debt conversion into common stock ($0.0315/sh), fair market value			$ 0.0315									$ 0.0315
Convertible debt conversion into common stock (0.1554sh), fair market value		$ 0.1554										$ 0.1554
Convertible debt conversion into common stock ($0.1455/sh) (Shares)		96,220
Convertible debt conversion into common stock (0.1455sh), fair market value		$ 0.1455										$ 0.1455
Convertible debt conversion into common stock ($0.1339/sh) (Shares)	116,505
Convertible debt conversion into common stock (0.1339sh), fair market value	$ 0.1339											$ 0.1339
Services expense												$ 1,199,794
Expected volatility												436.04%																																									461.11%	112.80%																																													145.70%	172.90%	152.80%	237.76%
Risk free interest rate												1.00%																																									0.33%	1.65%																																													1.26%	0.94%	1.35%	0.19%
Expected term: conversion feature												3 years																																									3 years	3 years																																													3 years	3 years	3 years	3 years
Option issued for cash and services										12,000,000	0
Common stock reserved for future exercise of options										12,000,000

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Going Concern (Details) (USD $)	6 Months Ended		79 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Dec. 31, 2011
Going Concern (Textual) [Abstract]
Deficit accumulated during the development stage	$ 15,794,251		$ 15,794,251	$ 14,359,984
Cash flow from operations	$ (1,005,229)	$ (261,974)	$ (2,646,452)

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Condensed Statements of Cash Flows (Unaudited) (USD $)	6 Months Ended		79 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012
Cash Flows From Operating Activities:
Net Loss	$ (1,434,267)	$ (3,493,186)	$ (15,657,796)
Adjustments to reconcile net loss to net cash used in operations
Depreciation/Amortization	22,354	19,136	106,100
Depreciation for abandonment of website			38,794
In kind contribution of rent - related party			24,963
Stock issued for services	31,955	651,598	2,566,565
Warrants issued for services	48,031		1,130,165
Amortization of stock options		1,199,794	1,199,794
Bluesky Fees			(1,750)
Amortization of stock based compensation		1,049,285	7,021,466
Security deposit		(300)	(413)
Amortization of debt offering costs	30,380		30,380
Amortization of debt discount	189,925	9,371	164,993
Change in fair value of derivative liability	187,494	32,085	212,426
Changes in operating assets and liabilities:
(Increase)/Decrease in prepaid expenses	(3,146)	4,944	(26,805)
Increase/(Decrease) accounts payable	13,130	(27,677)	38,600
Increase(Decrease) in warrant liabilities		162,746
Increase/(Decrease) in accrued expenses	(91,085)	130,230	506,066
Net Cash Used In Operating Activities	(1,005,229)	(261,974)	(2,646,452)
Cash Flows From Investing Activities:
Register of trademark			(275)
Purchase of property equipment	(97,400)		(365,940)
Net Cash Used In Investing Activities	(97,400)		(366,215)
Cash Flows From Financing Activities:
Proceeds from stockholder loans		81,150	620,583
Repayment of stockholder loans		(85,000)	(520,583)
Accrued expenses payment made by a former shareholder			4,400
Proceeds from issuance of convertible note, net of offering costs	701,000	37,500	785,500
Proceeds from issuance of stock, net of subscriptions receivable and net of offering costs		354,000	1,772,920
Proceeds from collection of stock subscription receivable			464,750
Net Cash Provided by Financing Activities	701,000	387,650	3,127,570
Net Increase / (Decrease) in Cash	(401,629)	125,676	114,903
Cash at Beginning of Period	516,532	297
Cash at End of Period	114,903	125,973	114,903
Supplemental disclosure of cash flow information:
Cash paid for interest
Cash paid for taxes
Supplemental disclosure of non-cash investing and financing activities:
Shares issued in connection with intellectual property		300,000	7,800,000
Shares issued in conversion of related party accrued compensation		144,000	427,652
Shares issued in conversion of related party line of credit		100,000	100,000
Shares issued in conversion of convertible debt and accrued interest		52,003	93,603
Shares issued in connection with stock dividend			136,713
Stock sold for subscription		397,000	464,750
Debt discount recorded on convertible and unsecured debt accounted for as a derivative liability	$ 521,289		$ 521,289

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Condensed Balance Sheets (Parenthetical) (USD $)	Jun. 30, 2012	Dec. 31, 2011
Statement Of Financial Position [Abstract]
Debt discount	$ 331,364
Preferred stock, par value	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued
Preferred stock, shares outstanding
Common stock, par value	$ 0.0001	$ 0.0001
Common stock, shares authorized	400,000,000	400,000,000
Common shares issued	255,335,394	255,184,661
Common stock, shares outstanding	255,335,394	255,184,661

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Litigation

6 Months Ended

Jun. 30, 2012

Litigation [Abstract]

LITIGATION

NOTE 10           LITIGATION

From time to time, the Company may become involved in various lawsuits and legal proceedings, which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm its business.

On February 6, 2012, the Company filed a suit for declaratory judgment and rescission of contract associated with a former consultant for failure to perform contractual requirements.  It seeks clarification that the former consultant is not owed 750,000 shares of restricted common stock.  The defendants have been served.  This case will be vigorously prosecuted and has a good likelihood of a favorable outcome. The case seeks in excess of the jurisdictional amount which is $50,000 dollars.

On February 21, 2012, the Company filed a suit for breach of contract, intentional misrepresentation, negligent misrepresentation, fraud, false advertising, and unfair competition with a former consultant.   It seeks damages due to their alleged failure to meet the contractual requirements regarding promotions.  The defendant has just recently been served.  This case will be vigorously prosecuted and has a good likelihood of success.  The case seeks in excess of the jurisdictional amount which is $50,000 dollars. No assurance can be given as to the ultimate outcome of these actions or its effect on the Company.

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Document and Entity Information	6 Months Ended
	Jun. 30, 2012	Aug. 13, 2012
Document and Entity Information [Abstract]
Entity Registrant Name	Max Sound Corp
Entity Central Index Key	0001353499
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Document Type	10-Q
Document Period End Date	Jun. 30, 2012
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	Q2
Entity Current Reporting Status	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		255,460,394

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Subsequent Events

6 Months Ended

Jun. 30, 2012

Subsequent Events [Abstract]

SUBSEQUENT EVENTS

NOTE 11           SUBSEQUENT EVENTS

In preparing these financial statements, the Company has evaluated events and transactions for potential recognition or disclosure as follows:

On July 16, 2012, the Company entered into an agreement whereby the Company will issue up to $58,333 in a convertible note.  The note matures on January 15, 2013 and bears an interest rate of 10%.  The conversion price equals the “Variable Conversion Price”, which is 70% of the “Market Price”, which is the low traded price of the common stock during the twenty (20) trading day period prior to the conversion.

On July 19, 2012, the Company entered into an agreement whereby the Company will issue up to $110,000 in a convertible note.  The note matures on April 19, 2013 and bears an interest rate of 8%.  The conversion price equals the “Variable Conversion Price”, which is 70% of the “Market Price”, which is the average of the lowest three (3) trading prices for the common stock during the ten (10) trading day period prior to the conversion.

On July 30, 2012, the Company entered into an agreement whereby the Company will issue up to $111,000 in a convertible note.  The note matures on April 30, 2013 and bears an interest rate of 8%.  The conversion price equals the “Variable Conversion Price”, which is 70% of the “Market Price”, which is the average of the lowest three (3) trading prices for the common stock during the ten (10) trading day period prior to the conversion.

On August 3, 2012, the Company entered into an agreement whereby the Company will issue up to $82,500 in a convertible note.  The note matures on August 3, 2013 and bears an interest rate of 4%.  The conversion price equals the “Variable Conversion Price”, which is 70% of the “Market Price”, which is the average of the lowest three (3) trading prices for the common stock during the ten (10) trading day period prior to the conversion.

In July and August of 2012, the Company issued 125,000 shares of stock to an employee per an employment agreement dated June 11, 2012.

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Condensed Statements of Operations (Unaudited) (USD $)	3 Months Ended		6 Months Ended		79 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012
Income Statement [Abstract]
Revenue					$ 23,826
Operating Expenses
General and administrative	144,717	32,243	338,332	69,135	961,700
Endorsement fees		411,900		819,273	4,942,277
Consulting	139,611	455,246	259,611	2,382,106	5,655,557
Professional fees	26,059	26,883	84,629	67,559	450,940
Website development					251,263
Compensation	162,000	54,000	324,000	108,000	2,982,343
Total Operating Expenses	472,387	980,272	1,006,572	3,446,073	15,244,080
Loss from Operations	(472,387)	(980,272)	(1,006,572)	(3,446,073)	(15,220,254)
Other Income / (Expense)
Interest income	57	25	129	25	640
Gain on extinguishment of debt					6,643
Interest expense	(127,730)	(2,647)	(127,730)	(5,682)	(144,731)
Amortization of debt offering costs	(29,178)		(30,380)		(30,380)
Amortization of debt discount	(185,392)	(3,139)	(189,925)	(9,371)	(213,908)
Change in fair value of embedded derivative liability	(9,285)	17,040	(79,789)	(32,085)	(55,806)
Total Other Income / (Expense)	(351,528)	11,279	(427,695)	(47,113)	(437,542)
Provision for Income Taxes
Net Loss	$ (823,915)	$ (968,993)	$ (1,434,267)	$ (3,493,186)	$ (15,657,796)
Net Loss Per Share - Basic and Diluted	$ 0.00	$ 0.00	$ (0.01)	$ (0.02)
Weighted average number of shares outstanding during the year Basic and Diluted	255,335,394	234,809,929	255,274,304	231,642,501

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Property and Equipment

6 Months Ended

Jun. 30, 2012

Property, Plant and Equipment [Abstract]

PROPERTY AND EQUIPMENT

NOTE 5             PROPERTY AND EQUIPMENT

At June 30, 2012, and December 31, 2011, respectively, property and equipment is as follows:

	June 30, 2012			December 31, 2011
Website Development	$	187,723		$	127,722
Furniture and Equipment		103,906			103,906
Leasehold Improvements		6,573			6,573
Software		29,963			18,888
Office Equipment		35,647			9,323
Domain Name		1,500			1,500
Sign		628			628
Less accumulated depreciation and amortization		(144,894	)		(122,540	)
	$	221,046		$	146,000

Depreciation/amortization expense for the six months ended June 30, 2012, and 2011, was $22,354 and $19,136, respectively.

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Line of Credit - Principal Stockholder

6 Months Ended

Jun. 30, 2012

Long-Term Line Of Credit [Abstract]

LINE OF CREDIT-PRINCIPAL STOCKHOLDER

NOTE 4             LINE OF CREDIT – PRINCIPAL STOCKHOLDER

On May 28, 2009, the Company entered into a two year line of credit agreement with the principal stockholder in the amount of $100,000.  The line of credit carries an interest rate of 3.25%.  As of December 31, 2011, the principal stockholder has advanced the Company $100,000 under the terms of this line of credit agreement (See Note 9).

On November 10, 2009, the Company entered into a two year line of credit agreement with the principal stockholder in the amount of $100,000.  The line of credit carries an interest rate of 3.25%.  As of December 31, 2011, the principal stockholder has advanced $100,000 to the Company under the terms of this line of credit agreement (See Note 9).

On March 25, 2010, the Company entered into a two year line of credit agreement with the principal stockholder in the amount of $500,000.  The line of credit carries an interest rate of 3.25%.  On February 17, 2011, the principal stockholder converted $100,000 of the line of credit owed into 909,091 shares of common stock at $0.11 per share.  As of December 31, 2011, the principal stockholder has advanced $360,580 to the Company under the terms of this line of credit agreement. (See Note 7(G) and Note 9).

As of December 31, 2011, the Company repaid $460,580 in principal and $11,283 of accrued interest to the principal stockholder related to these lines of credit (See Note 9).

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Summary of Significant Accounting Policies and Organization (Details) (USD $)	3 Months Ended		6 Months Ended		79 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Dec. 31, 2011
Summary of Significant Accounting Policies and Organization (Textual)
Cash equivalents	$ 0		$ 0		$ 0
Amortization period of cost that incurred in development stage			3 years
Cash in banks in excess of FDIC insurance limits	0		0		0	251,578
Revenue					23,826
Advertising Costs			51,069	14,120
Impairment of long-lived assets
Intangible assets	$ 7,800,275		$ 7,800,275		$ 7,800,275	$ 7,800,275
Number of operating segments			1
Minimum [Member]
Summary of Significant Accounting Policies and Organization (Textual)
Property and equipment, useful life			3 years
Maximum [Member]
Summary of Significant Accounting Policies and Organization (Textual)
Property and equipment, useful life			5 years
Stock warrants [Member]
Summary of Significant Accounting Policies and Organization (Textual)
Shares excluded from the computations of diluted loss per share			2,915,800	1,760,000
Stock Options [Member]
Summary of Significant Accounting Policies and Organization (Textual)
Shares excluded from the computations of diluted loss per share			12,000,000	12,000,000
Convertible debt [Member]
Summary of Significant Accounting Policies and Organization (Textual)
Shares excluded from the computations of diluted loss per share			3,278,976	282,532

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Summary of Significant Accounting Policies and Organization (Policies)

6 Months Ended

Jun. 30, 2012

Accounting Policies [Abstract]

Organization and Basis of Presentation

(A)  Organization and Basis of Presentation

Max Sound Corporation (the "Company") was incorporated in Delaware on December 9, 2005.  The Company is currently in the development stage, and on or around February 2011, the Company changed its business operations to focus primarily on developing and launching audio technology software.

Prior to February 2011, the Company's business operations were focused on creating search technologies within an online networking platform.

The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in The United States of America and the rules and regulations of the Securities and Exchange Commission for interim financial information.  Accordingly, they do not include all the information necessary for a comprehensive presentation of financial position and results of operations.

It is management's opinion, however, that all material adjustments (consisting of normal and recurring adjustments) have been made which are necessary for a fair financial statements presentation.  The results for the interim period are not necessarily indicative of the results to be expected for the year.

Activities during the development stage include developing the online networking platform, launching our audio technology, and raising capital.

Effective March 1, 2011, the Company filed with the State of Delaware a Certificate of Amendment of Certificate of Incorporation changing our name from So Act Network, Inc. to Max Sound Corporation.

Use of Estimates

(B) Use of Estimates

In preparing financial statements in conformity with generally accepted accounting principles, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reported period.  Actual results could differ from those estimates.

Cash and Cash Equivalents

(C) Cash and Cash Equivalents

For purposes of the cash flow statements, the Company considers all highly liquid investments with original maturities of three months or less at the time of purchase to be cash equivalents.  As of June 30, 2012 and December 31, 2011, the Company had no cash equivalents.

Property and Equipment

(D) Property and Equipment

Property and equipment are stated at cost, less accumulated depreciation.  Expenditures for maintenance and repairs are charged to expense as incurred.  Depreciation is provided using the straight-line method over the estimated useful life of three to five years.

Research and Development

(E) Research and Development

The Company has adopted the provisions of FASB Accounting Standards Codification No. 350, Intangibles – Goodwill & Other.  Costs incurred in the planning stage of a website are expensed as research and development while costs incurred in the development stage are capitalized and amortized over the life of the asset, estimated to be three years.  Expenses subsequent to the launch have been expensed as website development expenses.

Concentration of Credit Risk

(F) Concentration of Credit Risk

The Company at times has cash in banks in excess of FDIC insurance limits. The Company had approximately $0 and $251,578 in excess of FDIC insurance limits as of June 30, 2012 and December 31, 2011, respectively.

Revenue Recognition

(G) Revenue Recognition

The Company recognized revenue on arrangements in accordance with FASB Codification Topic 605, “Revenue Recognition” (“ASC Topic 605”).  Under ASC Topic 605, revenue is recognized only when the price is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting receivable is reasonably assured.  We had revenue of $0, and $0 for the six months ended June 30, 2012 and 2011, respectively.

Advertising Costs

(H) Advertising Costs

Advertising costs are expensed as incurred and include the costs of public relations activities.  These costs are included in consulting and general and administrative expenses and totaled $51,069 and $14,120 for the six months ended June 30, 2012 and 2011, respectively.

Identifiable Intangible Assets

(I) Identifiable Intangible Assets

As of June 30, 2012 and December 31, 2011, $7,800,275 and $7,800,275, respectively of costs related to registering a trademark and acquiring technology rights have been capitalized.  It has been determined that the trademark and technology rights have an indefinite useful life and are not subject to amortization.  However, the trademark and technology rights will be reviewed for impairment annually or more frequently if impairment indicators arise.

Impairment of Long-Lived Assets

(J) Impairment of Long-Lived Assets

The Company accounts for its long-lived assets in accordance with ASC Topic 360-10-05, “Accounting for the Impairment or Disposal of Long-Lived Assets.” ASC Topic 360-10-05 requires that long-lived assets, such as technology rights, be reviewed for impairment annually, or whenever events or changes in circumstances indicate that the historical cost carrying value of an asset may no longer be appropriate. The Company assesses recoverability of the carrying value of an asset by estimating the future net cash flows expected to result from the asset, including eventual disposition. If the future net cash flows are less than the carrying value of the asset, an impairment loss is recorded equal to the difference between the asset’s carrying value and fair value or disposable value. No impairments were recorded for six months ended June 30, 2012, and for the year ended December 31, 2011.

Loss Per Share

(K) Loss Per Share

In accordance with accounting guidance now codified as FASB ASC Topic 260, “Earnings per Share,”  Basic earnings per share (“EPS”) is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding during the period, excluding the effects of any potentially dilutive securities. Diluted EPS gives effect to all dilutive potential of shares of common stock outstanding during the period including stock options or warrants, using the treasury stock method (by using the average stock price for the period to determine the number of shares assumed to be purchased from the exercise of stock options or warrants), and convertible debt or convertible preferred stock, using the if-converted method. Diluted EPS excludes all dilutive potential of shares of common stock if their effect is anti-dilutive.  Because of the Company’s net losses, the effects of stock warrants and stock options would be anti-dilutive and accordingly, is excluded from the computation of earnings per share.  The number of such shares excluded from the computations of diluted loss per share totaled 2,915,800 and 1,760,000 for stock warrants, and 12,000,000 and 12,000,000 for stock options, and 3,278,976 and 282,532 shares issuable upon the conversion of convertible debt, for the six months ended June 30, 2012 and 2011, respectively.

Income Taxes

(L) Income Taxes

The Company accounts for income taxes under FASB Codification Topic 740-10-25 (“ASC 740-10-25”) Income Taxes.  Under ASC 740-10-25, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases.  Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  Under ASC 740-10-25, 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.

The Company's federal income tax returns are no longer subject to examination by the IRS for the years prior to 2008, and the related state income tax returns are no longer subject to examination by state authorities for the years prior to 2008.

Business Segments

(M) Business Segments

The Company operates in one segment and therefore segment information is not presented.

Recent Accounting Pronouncements

(N) Recent Accounting Pronouncements

The Company's management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted would have a material impact on the accompanying financial statements.

Fair Value of Financial Instruments

(O) Fair Value of Financial Instruments

The carrying amounts on the Company’s financial instruments including prepaid expenses, accounts payable, accrued expenses, derivative liability, convertible note payable, and loan payable-related party, approximate fair value due to the relatively short period to maturity for these instruments.

Stock-Based Compensation

(P) Stock-Based Compensation

In December 2004, the FASB issued FASB Accounting Standards Codification No. 718, Compensation – Stock Compensation.  Under FASB Accounting Standards Codification No. 718, companies are required to measure the compensation costs of share-based compensation arrangements based on the grant-date fair value and recognize the costs in the financial statements over the period during which employees are required to provide services. Share-based compensation arrangements include stock options, restricted share plans, performance-based awards, share appreciation rights and employee share purchase plans.  As such, compensation cost is measured on the date of grant at their fair value.  Such compensation amounts, if any, are amortized over the respective vesting periods of the option grant.  The Company applies this statement prospectively.

Equity instruments (“instruments”) issued to other than employees are recorded on the basis of the fair value of the instruments, as required by FASB Accounting Standards Codification No. 718.  FASB Accounting Standards Codification No. 505, Equity Based Payments to Non-Employees defines the measurement date and recognition period for such instruments.  In general, the measurement date is when either a (a) performance commitment, as defined, is reached or (b) the earlier of (i) the non-employee performance is complete or (ii) the instruments are vested. The measured value related to the instruments is recognized over a period based on the facts and circumstances of each particular grant as defined in the FASB Accounting Standards Codification.

Reclassification

(Q) Reclassification

Certain amounts from prior periods have been reclassified to conform to the current period presentation.  These reclassifications had no impact on the Company's net loss or cash flows.

Derivative Financial Instruments

(R) Derivative Financial Instruments

Fair value accounting requires bifurcation of embedded derivative instruments such as conversion features in convertible debt or equity instruments, and measurement of their fair value for accounting purposes.  In determining the appropriate fair value, the Company uses the Black-Scholes option-pricing model.  In assessing the convertible debt instruments, management determines if the convertible debt host instrument is conventional convertible debt and further if there is a beneficial conversion feature requiring measurement.  If the instrument is not considered conventional convertible debt, the Company will continue its evaluation process of these instruments as derivative financial instruments.

Once determined, derivative liabilities are adjusted to reflect fair value at each reporting period end, with any increase or decrease in the fair value being recorded in results of operations as an adjustment to fair value of derivatives.  In addition, the fair value of freestanding derivative instruments such as warrants, are also valued using the Black-Scholes option-pricing model.

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Commitments

6 Months Ended

Jun. 30, 2012

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS

NOTE 8             COMMITMENTS

(A)  Employment Agreement

On October 13, 2008, the Company executed an employment agreement with its President and CEO.  The term of the agreement is for ten years.  As compensation for services, the President will receive a monthly compensation of $18,000 beginning October 13, 2008.  In addition, to the base salary, the employee is entitled to receive a 10% commission of all sales of the Corporation.  The agreement also calls for the employee to receive health benefits.  For the six months ended June 30, 2012, the Company has recorded $108,000 in compensation expense (See Note 9).

On January 17, 2011, the Company executed an employment agreement with an executive to be CEO for five years.  As compensation for services, the executive will receive a monthly compensation of $8,000 beginning after the completion of at least one million dollars of new funding to the Corporation or can be paid as commissions from sales brought to the Company, whichever comes first. In addition to the base salary, the employee is entitled to receive a 20% commission of all sales the executive is directly responsible for bringing to the Company.  The agreement also calls for the executive to receive, upon execution of the agreement, three million shares of Rule 144 common stock and twelve million options, which are good for three years, to buy shares of Rule 144 common stock at $0.12/share.  As a supplement to the agreement, on February 4, 2011, the executive shall receive an additional twenty million common shares directly from the President of the Company.  On August 25, 2011, the agreement was updated to increase the monthly compensation to $12,000 per month beginning September 1, 2011, terminate the initial 20% commission on sales and to add a commission on sales equal to 10% of gross quarterly profits.  The agreement also calls for the employee to receive health benefits (See Note 7(B) and 7(I)).

On May 17, 2011, the Company executed an employment agreement with its Chief Internet Officer (“CIO”).  The term of the agreement is for five years.  As compensation for services, the CIO will receive a monthly compensation of $9,000 beginning at the completion of at least one million dollars of new funding.  In addition to the base salary, the employee is entitled to receive health benefits.  The agreement also calls for the CIO to receive two million shares of Rule 144 common stock upon the execution of the agreement.  On August 25, 2011, the agreement was updated to increase the monthly compensation to $12,000 per month beginning October 1, 2011.  (See Note 7(B)).

On October 1, 2011, the Company executed an employment agreement with its Chief Technical Officer (“CTO”).  The term of the agreement is for five years.  As compensation for services, the CTO will receive a monthly compensation of $10,000, monthly commission equal to 5% of all profits derived from the sales of all products and services related to Max Sound, and an annual bonus of 5% of all profits derived from the sales of all products and services related to Max Sound that is over one million dollars.  In addition to the base salary, the employee is entitled to receive health benefits.  Effective January 1, 2012, the Company increased the monthly compensation to $12,000.

On June 11, 2012, the Company executed an employment agreement with its Senior Audio Engineer.  The term of the agreement is for five years.  As compensation for services, the Engineer will receive a monthly compensation of $6,000 beginning July 1, 2012.  In addition to the base salary, the employee is entitled to receive health benefits, and the employee will receive 1,000,000 shares of common stock payable in 125,000 increments per quarter beginning on July 1, 2012.

(B)   Consulting Agreement

On January 19, 2009, the Company entered into a development services agreement to construct social network software for a fee of $150 and $375 an hour.  The contract will remain in place until either party desires to cancel.  A retainer fee of $20,000 has been paid upon the execution of the agreement and will be used towards the services provided.  In addition, on January 14, 2009 the Company issued 20,000 shares in exchange for services valued at $5,000 ($0.25/share).  As a result of the forward split, the 20,000 shares were increased to 80,000 shares and its purchase price was similarly adjusted to $0.0625 (See Note 7(B) and Note 7(D)).  On May 29, 2009 the Company amended the consulting agreement by reducing the hourly rate to $75 an hour and reducing the outstanding balance due by $17,163. On August 31, 2009, the Company issued 885,714 shares of common stock in exchange for services valued at $62,000 related to the development services agreement entered into on January 19, 2009.  Based on the most recent fair market value at that time, the shares were valued at $55,357 ($0.0625/share), resulting in the recognition of a gain on the extinguishment of debt of $6,643 (See Note 7(B)).

On January 20, 2009, the Company entered into a service agreement with a transfer agent to become the Company's transfer agent for the purpose of maintaining stock ownership and transfer records for the Company.

On September 17, 2009, the Company entered into a six month consulting agreement with an unrelated third party to provide public relations services.  In exchange for the services provided, on September 18, 2009 the Company issued 500,000 shares of common stock having a fair value of $175,000 ($0.35/share) based upon fair value on the date of grant.  The Company has an option to cancel the contract during the first ninety days of the agreement and 200,000 shares will be returned back to the Company.  On November 11, 2009, the Company cancelled the agreement and 300,000 shares of common stock were returned to the Company.   As of December 31, 2009, $70,000 is recorded as consulting expense and $105,000 of deferred compensation was reclassified to $0 (See Note 7(B)).

On September 18, 2009, the Company entered into a six month consulting agreement with an unrelated third party to provide public relations services.  In exchange for the services provided the Company issued 600,000 shares of common stock having a fair value of $210,000 ($0.35/share) based upon fair value on the date of grant.  Shares will be issued on or before December 18, 2009 in six 100,000 increments.  The Company has an option to cancel the contract at any time, in such event; the consultant will return a prorated amount of shares based on the months remaining in the consulting agreement.   On November 18, 2009, the Company cancelled the agreement and 400,000 shares of common stock were returned to the Company.  As of December 31, 2009 $70,000 is recorded as consulting expense and $140,000 of deferred compensation was reclassified to $0 (See Note 7(B)).

On September 21, 2009, the Company entered into an eight month consulting agreement with an unrelated third party to provide public relations services.  In exchange for the services provided, the Company issued 600,000 shares of common stock having a fair value of $210,000 ($0.35/share) based upon fair value on the date of grant.  Shares will be issued on or before September 18, 2009, December 18, 2009, and March 18, 2010, in 200,000 increments.  The Company has an option to cancel the contract at any time and no additional stock issuances will be due.  On December 18, 2009, the Company cancelled the agreement and 400,000 shares of common stock were returned to the Company.  As of December 31, 2009, $70,000 is recorded as consulting expense and $140,000 of deferred compensation was reclassified to $0 (See Note 7(B)).

On October 20, 2009, the Company entered into a marketing agreement with an unrelated third party.  In exchange for the services provided, on November 21, 2009, the Company issued 30,000 shares of common stock having a fair value $53,100 ($1.77/share) based upon fair value on the date of grant, and compensation of $5,000, of which $2,500 was paid in 2009 upon the execution of the agreement and the remaining $2,500 was paid in 2010 upon completion (See Note 7(B)).

During the months of November and December 2009, the Company entered into celebrity endorsement agreements for a period of one to two years of service.  In total, 1,710,000 shares of common stock were issued having a fair value of $3,285,400 based upon fair value on the respective date of grant.  During 2009 and 2010, $87,805 and $1,712,815 was recorded as consulting expense, respectively.  For the year ended December 31, 2011, $1,484,780 is recorded as consulting expense, and $0 is recorded as deferred compensation (See Note 7(B)).

On December 3, 2009, the Company entered into a commission agreement with an unrelated third party.  The company will pay a 10% commission in shares of common stock for every passive endorsement.  In exchange for the services provided the Company issued 35,000 shares of common stock having a fair value $68,250 ($1.95/share) based upon fair value on the date of grant (See Note 7(B)).

On December 3, 2009, the Company entered into a commission agreement with an unrelated third party.  The company will pay a 10% commission in shares of common stock for every passive endorsement.  In exchange for the services provided the Company issued 240,000 shares of common stock having a fair value $468,000 ($1.95/share) based upon fair value on the date of grant (See Note 7(B)).

On December 3, 2009, the Company entered into a commission agreement with an unrelated third party.  The company will pay a 10% commission in shares of common stock for every passive endorsement.  In exchange for the services provided the Company issued 35,000 shares of common stock having a fair value $68,250 ($1.95/share) based upon fair value on the date of grant (See Note 7(B)).

On December 3, 2009, the Company entered into a commission agreement with an unrelated third party.  The company will pay a 10% commission in shares of common stock for every passive endorsement.  In exchange for the services provided the Company issued 10,000 shares of common stock having a fair value $19,500 ($1.95/share) based upon fair value on the date of grant (See Note 7(B)).

On December 15, 2009, the Company entered into a consulting agreement with an unrelated third party to provide investor services.  The Company will receive a 10% of the gross receipts from the investor relations revenue for a two year period.  In exchange for the satisfactory services provided, on December 15, 2009, the Company issued 100,000 shares of common stock having a fair value of $200,000 ($2/share) based upon fair value on the date of grant (See Note 7(B)).

On December 27, 2009, the Company entered into a consulting agreement with an unrelated third party to provide film work.  In exchange for the services provided the Company issued 10,000 shares of common stock having a fair value $19,400 ($1.94/share) based upon fair value on the date of grant (See Note 7(B)).

On December 27, 2009, the Company entered into an endorsement agreement with an unrelated third party to provide film work.  In exchange for the services provided the Company issued 10,000 shares of common stock having a fair value $19,400 ($1.94/share) based upon fair value on the date of grant (See Note 7(B)).

On December 27, 2009, the Company entered into a consulting agreement with an unrelated third party to provide film scripting, editing and production work.  In exchange for the services provided the Company issued 10,000 shares of common stock having a fair value $19,400 ($1.94/share) based upon fair value on the date of grant (See Note 7(B)).

On December 30, 2009, the Company entered into a marketing agreement with an unrelated third party for a period from January 2010 to December 2010.  In exchange for the services provided, the Company issued 500,000 shares of common stock having a fair value of $965,000 ($1.93/share) based upon fair value on the date of grant.  An additional 1,000,000 shares of common stock having a fair value of $1,930,000 ($1.93/share) based upon fair value on the date of grant, were issued for an additional sponsorship commitment. The additional 1,000,000 shares were to be held in escrow until June 30, 2010, at which point the unrelated party would have 15 days to accept or decline the additional shares.As of December 31, 2010, the shares were returned back to the Company’s treasury due to non-performance of services and no additional shares will be issued (See Note 7(B)).

On December 31, 2009, the Company entered into a consulting agreement with an unrelated third party for a period from December 31, 2009 through March 30, 2011.  In exchange for the services provided, the Company issued 75,000 shares of common stock having a fair value of $144,750 ($1.93/share) based upon fair value on the date of grant, and deliverable in three increments of 25,000 shares of common stock each. The first 25,000 shares will be delivered upon the execution of the agreement and the other two increments will be delivered in six and twelve months upon the successful fulfillment of the agreement (See Note 7(B)).

On December 31, 2009, the Company entered into a consulting agreement with an unrelated third party for a period from December 31, 2009 through March 30, 2011.  In exchange for the services provided, the Company issued 75,000 shares of common stock having a fair value of $144,750 ($1.93/share) based upon fair value on the date of grant, and deliverable in three increments of 25,000 each. The first 25,000 shares will be delivered upon the execution of the agreement and the other two will be delivered in six and twelve months upon the successful fulfillment of the agreement (See Note 7(B)).

On December 31, 2009, the Company entered into a consulting agreement with an unrelated third party for a period from December 31, 2009 through December 31, 2010.  In exchange for the services provided, the Company issued 500,000 shares of common stock having a fair value of $965,000 ($1.93/share) based upon fair value on the date of grant (See Note 7(B)).

On January 11, 2010, the Company entered into a twelve month agreement with an unrelated third party for investor relations press release service for an annual fee of $14,250 and an initial onetime fee of $250.

On January 15, 2010, the Company entered into a two year celebrity endorsement agreement.  In total, 100,000 shares of common stock were issued having a fair value of $170,000($1.70/share) based upon fair value on the date of grant (See Note 7(B)).

On February 1, 2010, the Company entered into a twelve month consulting agreement effective February 5, 2010, with an unrelated third party to produce music compositions for a fee of $500.  The agreement can be renewed for up to two additional years for a fee of $500 for the first renewal year and $750 for the second renewal year.

On February 17, 2010, the Company entered into a twelve month consulting agreement with an unrelated third party effective February 17, 2010.  In exchange for the services provided, the Company issued 1,000,000 shares of common stock having a fair value of $1,240,000 ($1.24/share) based upon fair value on the date of grant (See Note 7(B)).

On June 1, 2010, the Company entered into a twelve month consulting agreement to provide for consulting and business services in raising capital.  The Company agrees to pay a finder’s fee on all capital raised in stock and warrants.  The Company paid an initial nonrefundable retainer fee by issuing 40,000 shares of stock having a value of $10,000 ($0.25/share) based upon fair value on the date of the agreement.  In conjunction with the stock payment, the Company also issued one warrant attached to each share of stock exercisable at $0.50 per warrant.  Based upon the number of shares (40,000 shares) of stock issued, the Company issued 40,000 warrants (See Note 7(B) and Note 7(C).

On May 11, 2010, the Company acquired the rights to an audio technology known as Max Audio Technology (Max) through a share exchange, whereby the Company issued 30,000,000 shares of common stock to two individuals in exchange for their rights in Max having a value of $7,500,000 based upon recent market value ($0.25/share).  (See Note 7(H)).

In accordance with the share exchange, the former owners to the rights of Max became Executives of the Company.  The two new executives individually entered into employment agreements with the Company on May 11, 2010.  The term of the employment agreements are for ten years of service at a monthly compensation of $8,500 for each executive.  In addition, the Executives are entitled to receive 5% of all revenues derived from the sale of all products and services related to the Max Audio Technology.  On January 2, 2011, the agreement was cancelled.

On April 15, 2010, the Company entered into a finder’s fee agreement.  For each qualified investor introduced to the Company by the consultant, the Company will pay a 10% fee in cash equal to 10% of the dollar amount of securities purchased,  In addition, the Company will pay a 10% fee in warrants equal to 10% of the number of shares of stock purchased (See Note 7(C)).

On August 8, 2010, the Company entered into a consulting agreement with an unrelated third party to provide consulting services.  Upon the execution of the agreement the consultant received 100,000 shares of common stock.  A monthly issuance of 100,000 shares of common stock will be issued as a compensation of services provided.  The term of the agreement is for three months and will continue to renew for three month intervals unless cancelled by either party.  The agreement was cancelled on November 1, 2010 (See Note 7(B)).

On August 17, 2010, the Company entered into a consulting agreement.  The agreement shall remain in effect until terminated.  In exchange for the services provided, the consultant will receive a $500 a month allowance for general expenses.  In addition, for all the new business brought to the Company the consultant will receive a 10% compensation for each gross dollar received by the Company.  On February 15, 2011, the Company terminated the agreement.

On December 14, 2010, the Company entered into to a consulting agreement for consulting and advertising services.  Upon the execution of the agreement, the consultant received 250,000 shares with an additional 750,000 shares to be issued upon consultant obtaining sponsorship rights in the year 2011.  The sponsorship rights were not obtained and the agreement was cancelled in 2011 and the additional 750,000 shares were never issued (See Note 7(B)).

On February 17, 2011, the Company entered into a consulting agreement for public relations and communications services.  In exchange for the services provided, the consultant received 500,000 shares of common stock. The term of the agreement is for one year (See Note 7 (B)).

On March 3, 2011, the Company entered into a consulting agreement for public relations and communications services.  In exchange for the services provided, the consultant received 1,000,000 shares of common stock. The term of the agreement is for one year (See Note 7 (B)).

On June 10, 2011, the Company entered into a five year advisory board consulting agreement with three persons to provide for consulting and business services.  In exchange for the services provided, the consultants received 100,000 shares of common stock each.  (See Note 7(B)).

On June 15, 2011, the Company entered into a consulting agreement with an unrelated third party for software and computer technology services.  In exchange for the services provided, the consultant will be paid $70 per hour with $50 per hour paid in cash and $20 per hour paid in Company stock at $0.10 per share.  The term of the agreement is for one year. (See Note 7(B)).

On July 1, 2011, the Company entered into a consulting agreement with an unrelated third party for trade show services.  In exchange for the services provided, the consultant received 6,500 shares of common stock at $0.08/per share. The agreement was for one-time services. (See Note 7(B)).

During the year ended December 31, 2011, the Company entered into an agreement with an unrelated third party for software and computer technology services.  In exchange for the services provided, the consultant received 76,483 shares of common stock at $0.10 – 0.39 per share. The term of the agreement is for one year. (See Note 7(B)).

In September 2011, the Company entered into a five year advisory board consulting agreement with three persons to provide for consulting and business services.  In exchange for the services provided, the consultants received 100,000 shares of Company stock at $0.23 – 0.39 per share.  The terms of the agreements are for five years. (See Note 7(B)).

On September 21, 2011, the Company entered into a consulting agreement with an unrelated third party for investor relation services.  In exchange for the services provided, the consultant received 400,000 shares of Company stock at $0.25 per share.  The term of the agreement is for six months. (See Note 7(B)).

During the three months ended December 31, 2011, the Company entered into a five year advisory board consulting agreement with five persons to provide for consulting and business services.  In exchange for the services provided, the consultants received 100,000 shares of Company stock at $0.47 – 0.88 per share.  The terms of the agreements are for five years. (See Note 7(B)).

(C) Operating Lease Agreements

On September 1, 2010 the Company executed a three-year non-cancelable operating lease for its new corporate office space. The lease began on October 1, 2010 and expires on September 30, 2013.  Total base rent due during the term of the lease is $134,880.

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Convertible Debts

6 Months Ended

Jun. 30, 2012

Convertible Debt [Abstract]

CONVERTIBLE DEBTS

NOTE 6             CONVERTIBLE DEBTS

On July 6, 2010, the Company entered into an agreement whereby the Company will issue up to $50,000 in a convertible note.  The note matured on March 30, 2011, and bears an interest rate of 8%.  Any unpaid amount as of the maturity date bears an interest rate of 22%.  The holder of the note has a right to convert all or any part of the outstanding an unpaid principal amount into shares of common stock.  The conversion prices equals the "Variable Conversion Price", which is 59% of the "Market Price", which is the average of the lowest six trading prices for the Common Stock during the ten (10) trading day period prior to the conversion.  In July of 2010, the Company received $50,000 proceeds less the $3,000 finder’s fee pursuant to the terms of this convertible note.  During the year ended December 31, 2011, the note holder converted $52,003 of the note payable and accrued interest into 1,545,350 shares of the company stock (See Note 7 (G)).

The Company computed the fair value of the conversion feature at the commitment date, based on the following management assumptions:

Exercise price		$0.1377
Expected dividends		0	%
Expected volatility		172.27	%
Expected term: conversion feature	267 days
Risk free interest rate		0.32	%

The fair value of the embedded conversion option on the commitment date was $15,409.  The Company recorded a related debt discount of $15,409, which was amortized over the life of the debt.  For the year ended December 31, 2010, the Company amortized $10,273 of debt discount.  For the year ended December 31, 2011, the Company amortized $5,136 of debt discount.

At December 31, 2011 the Company remeasured the derivative liability and recorded a fair value of $0.  As a result of the remeasurement, the Company recorded a change in fair value associated with this derivative liability as income totaling $13,262 for the year ended December 31, 2011. The following management assumptions were considered:

Exercise price	$0.0393
Expected dividends	0	%
Expected volatility	471.81	%
Risk fee interest rate	0.30	%
Expected life of conversion feature in days	0

On February 17, 2011, the Company entered into an agreement whereby the Company will issue up to $40,000 in a convertible note.  The note matures on November 17, 2011, and bears an interest rate of 8%.  The holder of the note has a right to convert all or any part of the outstanding an unpaid principal amount into shares of common stock.  The conversion prices equals the "Variable Conversion Price", which is 59% of the "Market Price", which is the average of the lowest six (6) trading prices for the Common Stock during the ten trading day period prior to the conversion.  In February of 2011, the Company received $40,000 proceeds less the $2,500 finder’s fee pursuant to the terms of this convertible note.  During the year ended December 31, 2011, the Company converted $41,600 of the note payable and accrued interest into 289,945 shares of the common stock.

The Company computed the fair value of the conversion feature at the commitment date, based on the following management assumptions:

Exercise price		$0.0738
Expected dividends		0	%
Expected volatility		456.63	%
Expected term: conversion feature	365 days
Risk free interest rate		0.27	%

The fair value of the embedded conversion option on the commitment date was $9,523.  The Company recorded a related debt discount of $9,523, which is amortized over the life of the debt.  For the year ended December 31, 2011, the Company amortized $9,523 of debt discount.

At December 31, 2011 the Company remeasured the derivative liability and recorded a fair value of $0.  As a result of the remeasurement, the Company recorded a change in fair value associated with this derivative liability as income totaling $9,523 for the year ended December 31, 2011. The following management assumptions were considered:

Exercise price	$0.035
Expected dividends	0	%
Expected volatility	514.06	%
Risk fee interest rate	0.19	%
Expected life of  conversion feature in days	140

On March 8, 2012, the Company entered into an agreement whereby the Company will issue up to $166,667 in a convertible note.  The note matures on March 9, 2013 and bears an interest rate of 4%.  The holder of the note has a right to convert all or any part of the outstanding an unpaid principal amount into shares of common stock after six months.  The conversion price equals the “Variable Conversion Price”, which is 70% of the “Market Price”, which is the average of the lowest ten (10) trading prices for the common stock during the ten trading day period prior to the conversion.  The Company received $150,000 proceeds, less the $16,667 finder’s fee pursuant to the terms of this convertible note, on March 14, 2012.

The Company computed the fair value of the conversion feature at the commitment date, based on the following management assumptions:

Exercise price		$0.2629
Expected dividends		0	%
Expected volatility		228.76	%
Expected term: conversion feature	365 days
Risk free interest rate		0.18	%

The fair value of the embedded conversion option on the commitment date was $42,178.  The Company recorded a related debt discount of $42,178, which is amortized over the life of the debt.  For the six months ended June 30, 2012, the Company amortized $13,058 of debt discount.

At June 30, 2012 the Company remeasured the derivative liability and recorded a fair value of $120,449.  As a result of the remeasurement, the Company recorded a change in fair value associated with this derivative liability as loss totaling $78,271 for the six months ended June 30, 2012. The following management assumptions were considered:

Exercise price	$0.2331
Expected dividends	0	%
Expected volatility	233.04	%
Risk fee interest rate	0.21	%
Expected life of  conversion feature in days	252

On March 14, 2012, the Company entered into an agreement whereby the Company will issue up to $102,500 in a convertible note.  The note matures on December 19, 2012 and bears an interest rate of 8%.  The holder of the note has a right to convert all or any part of the outstanding an unpaid principal amount into shares of common stock after six months.  The conversion price equals the “Variable Conversion Price”, which is 65% of the “Market Price”, which is the average of the lowest three (3) trading prices for the common stock during the ten trading day period prior to the conversion.  The Company received $102,500 proceeds, less the $2,500 finder’s fee pursuant to the terms of this convertible note, on March 20, 2012.

The Company computed the fair value of the conversion feature at the commitment date, based on the following management assumptions:

Exercise price		$0.1490
Expected dividends		0	%
Expected volatility		228.61	%
Expected term: conversion feature	280 days
Risk free interest rate		0.21	%

The fair value of the embedded conversion option on the commitment date was $30,894.  The Company recorded a related debt discount of $30,894, which is amortized over the life of the debt.  For the six months ended June 30, 2012, the Company amortized $11,806 of debt discount.

At June 30, 2012 the Company remeasured the derivative liability and recorded a fair value of $108,958.  As a result of the remeasurement, the Company recorded a change in fair value associated with this derivative liability as a loss totaling $78,064 for the six months ended June 30, 2012. The following management assumptions were considered:

Exercise price	$0.2080
Expected dividends	0	%
Expected volatility	233.04	%
Risk fee interest rate	0.21	%
Expected life of  conversion feature in days	172

On April 4, 2012, the Company entered into an agreement whereby the Company will issue up to $166,000 in a convertible note.  The note matures on December 28, 2012 and bears an interest rate of 8%.  The holder of the note has a right to convert all or any part of the outstanding an unpaid principal amount into shares of common stock after six months.  The conversion price equals the “Variable Conversion Price”, which is 70% of the “Market Price”, which is the average of the lowest three (3) trading prices for the common stock during the ten trading day period prior to the conversion.  The Company received $138,000 proceeds, less the $28,000 finder’s fee pursuant to the terms of this convertible note, on April 4, 2012.

The Company computed the fair value of the conversion feature at the commitment date, based on the following management assumptions:

Exercise price		$0.2077
Expected dividends		0	%
Expected volatility		232.90	%
Expected term: conversion feature	268 days
Risk free interest rate		0.19	%

The fair value of the embedded conversion option on the commitment date was $108,051.  The Company recorded a related debt discount of $108,051, which is amortized over the life of the debt.  For the six months ended June 30, 2012, the Company amortized $35,076 of debt discount.

At June 30, 2012, the Company remeasured the derivative liability and recorded a fair value of $162,667.  As a result of the remeasurement, the Company recorded a change in fair value associated with this derivative liability as loss totaling $54,616 for the six months ended June 30, 2012. The following management assumptions were considered:

Exercise price	$0.2240
Expected dividends	0	%
Expected volatility	233.04	%
Risk fee interest rate	0.21	%
Expected life of  conversion feature in days	181

On April 25, 2012, the Company entered into an agreement whereby the Company will issue up to $166,667 in a convertible note.  The note matures on April 25, 2013 and bears an interest rate of 4%.  The holder of the note has a right to convert all or any part of the outstanding an unpaid principal amount into shares of common stock after six months.  The conversion price equals the “Variable Conversion Price”, which is 70% of the “Market Price”, which is the average trading prices for the common stock during the ten trading day period prior to the conversion.  The Company received $150,000 proceeds, less the $16,667 finder’s fee pursuant to the terms of this convertible note, on April 25, 2012.

The Company computed the fair value of the conversion feature at the commitment date, based on the following management assumptions:

Exercise price		$0.1797
Expected dividends		0	%
Expected volatility		240.78	%
Expected term: conversion feature	365 days
Risk free interest rate		0.18	%

The fair value of the embedded conversion option on the commitment date was $255,484.  The Company recorded a related debt discount of $166,667, which is amortized over the life of the debt.  For the six months ended June 30, 2012, the Company amortized $30,137 of debt discount.

At June 30, 2012 the Company remeasured the derivative liability and recorded a fair value of $187,137.  As a result of the remeasurement, the Company recorded a change in fair value associated with this derivative liability as a gain totaling $68,348 for the six months ended June 30, 2012. The following management assumptions were considered:

Exercise price	$0.2240
Expected dividends	0	%
Expected volatility	233.04	%
Risk fee interest rate	0.21	%
Expected life of  conversion feature in days	299

On May 8, 2012, the Company entered into an agreement whereby the Company will issue up to $333,000 in a convertible note subject to a $33,000 original issue discount (OID).  The note matures on May 8, 2013 and bears an interest rate of 0% if note is repaid on or before 90 days from the effective date. If the note is not repaid within 90 days a one-time interest charge of 5% will be applied to the principal.  As of June 30, 2012, the Company has $111,000 of convertible note as outstanding.  The holder of the note has a right to convert all or any part of the outstanding an unpaid principal amount into shares of common stock after six months.  The conversion price equals the “Variable Conversion Price”, which is 70% of the “Market Price”, which is the average of the lowest three (3) trading prices for the common stock during the fifteen (15) trading day period prior to the conversion. The Company received $92,000 proceeds, less the $8,000 finder’s fee and $11,000 OID pursuant to the terms of this convertible note, on April 25, 2012.

The Company computed the fair value of the conversion feature at the commitment date, based on the following management assumptions:

Exercise price		$0.2030
Expected dividends		0	%
Expected volatility		240.90	%
Expected term: conversion feature	60 days
Risk free interest rate		0.18	%

The fair value of the embedded conversion option on the commitment date was $113,952.  The Company recorded a related debt discount of $111,000, which is amortized over the life of the debt.  For the six months ended June 30, 2012, the Company amortized $98,050 of debt discount.

At June 30, 2012 the Company remeasured the derivative liability and recorded a fair value of $54,946.  As a result of the remeasurement, the Company recorded a change in fair value associated with this derivative liability as a gain totaling $59,006 for the six months ended June 30, 2012. The following management assumptions were considered:

Exercise price	$0.2240
Expected dividends	0	%
Expected volatility	233.04	%
Risk fee interest rate	0.21	%
Expected life of  conversion feature in days	7

On June 22, 2012, the Company entered into an agreement whereby the Company will issue up to $62,500 in a convertible note.  The note matures on March 27, 2013 and bears an interest rate of 8%. As of June 30, 2012 the Company has $62,500 of convertible note as outstanding.   The holder of the note has a right to convert all or any part of the outstanding an unpaid principal amount into shares of common stock after six months.  The conversion price equals the “Variable Conversion Price”, which is 65% of the “Market Price”, which is the average of the lowest three (3) trading prices for the common stock during the ten trading day period prior to the conversion.   The Company received $60,000 proceeds, less the $2,500 finder’s fee pursuant to the terms of this convertible note, on April 25, 2012.

The Company computed the fair value of the conversion feature at the commitment date, based on the following management assumptions:

Exercise price		$0.1647
Expected dividends		0	%
Expected volatility		234.89	%
Expected term: conversion feature	278 days
Risk free interest rate		0.19	%

The fair value of the embedded conversion option on the commitment date was $78,435.  The Company recorded a related debt discount of $62,500, which is amortized over the life of the debt.  For the six months ended June 30, 2012, the Company amortized $1,798 of debt discount.

At June 30, 2012 the Company remeasured the derivative liability and recorded a fair value of $74,626.  As a result of the remeasurement, the Company recorded a change in fair value associated with this derivative liability as a gain totaling $3,809 for the six months ended June 30, 2012. The following management assumptions were considered:

Exercise price	$0.2240
Expected dividends	0	%
Expected volatility	233.04	%
Risk fee interest rate	0.21	%
Expected life of conversion feature  in days	270

XML

Stockholders' Equity

6 Months Ended

Jun. 30, 2012

Equity [Abstract]

STOCKHOLDERS' EQUITY

NOTE 7             STOCKHOLDERS’ EQUITY

(A) Common Stock Issued for Cash

On December 31, 2005, the Company issued 100,000 shares of common stock for cash of $100 in exchange for acceptance of the incorporation expenses for the Company ($0.001/share).   As a result of the forward split, the 100,000 shares were increased to 400,000 shares ($0.00025/share) (See Note 7(D)).

For the year ended December 31, 2008, the Company issued 473,000 shares of common stock for cash of $118,250 ($0.25/share), of which $67,750 was a subscription receivable.   During the month of January 2009, $67,750 of stock subscription receivable was collected.  As a result of the forward split, the 473,000 shares were increased to 1,892,000 shares ($0.0625/share). (See Note 7(D)).

On January 2, 2009, the Company entered into stock purchase agreements to issue 20,000 shares of common stock for cash of $5,000 ($0.25/share).   As a result of the forward split, the 20,000 shares were increased to 80,000 shares ($0.0625/share) (See Note 7(D)).

On January 3, 2009, the Company entered into stock purchase agreements to issue 2,000 shares of common stock for cash of $500 ($0.25/share).  As a result of the forward split, the 2,000 shares were increased to 8,000 shares ($0.0625/share) (See Note 7(D)).

On January 3, 2009, the Company entered into stock purchase agreements to issue 2,000 shares of common stock for cash of $500 ($0.25/share).  As a result of the forward split, the 2,000 shares were increased to 8,000 shares ($0.0625/share) (See Note 7(D)).

On January 11, 2009, the Company entered into stock purchase agreements to issue 32,000 shares of common stock for cash of $8,000 ($0.25/share).  As a result of the forward split, the 32,000 shares were increased to 128,000 shares ($0.0625/share) (See Note 7(D)).

On January 12, 2009, the Company entered into stock purchase agreements to issue 2,000 shares of common stock for cash of $500 ($0.25/share).   As a result of the forward split, the 2,000 shares were increased to 8,000 shares ($0.0625/share) (See Note 7(D)).

On January 15, 2009, the Company entered into stock purchase agreements to issue 4,000 shares of common stock for cash of $1,000 ($0.25/share).  As a result of the forward split, the 4,000 shares were increased to 16,000 shares ($0.0625/share) (See Note 7(D)).

In February of 2009, the Company paid direct offering costs of $850 related to the securities sold.

On May 27, 2010 the Company issued one unit; each unit consisted of 100,000 shares of common stock and 100,000 warrants to purchase common stock, for cash of $22,500 net of the $2,500 finder’s fee ($0.25/share).  Each warrant is exercisable for a three year period and has an exercise price of $0.50 per share (See Note 7(C)).

On July 23, 2010, the Company issued one unit; each unit consisted of 100,000 shares of common stock and 100,000 warrants to purchase common stock, for cash of $25,000 ($0.25/share).  Each warrant is exercisable for a three year period and has an exercise price of $0.50 per share (See Note 7(C).

On August 5, 2010, the Company issued 10 units; each unit consisted of 100,000 shares of common stock and 100,000 warrants to purchase common stock, for cash of $250,000 ($0.25/share).  Each warrant is exercisable for a three year period and has an exercise price of $0.50 per share (See Note 7(C).

During the year ended December 31, 2010, the Company paid direct offering costs of $2,900 related to the securities sold.

On January 24, 2011, the Company issued 10,000 shares of common stock for cash of $1,000 ($0.10/share).

On February 23, 2011, the Company issued 300,000 shares of common stock for cash of $30,000 ($0.10/share).

On March 21, 2011, the Company issued 150,000 shares of common stock for cash of $15,000 ($0.10/share).

On May 2, 2011, the Company issued 2,000,000 shares of common stock for cash of $200,000 ($0.10/share).

During the month of June 2011, the Company issued 5,460,000 shares of common stock for cash of $546,000 ($0.10/share) of which $397,000 was a subscription receivable.  The Company received the entire $397,000 of subscription receivable in July 2011.

During the months of July, August and September of 2011, the Company issued 10,937,000 shares of common stock for cash of $1,093,700 ($0.10/share).

During the year-ended December 31, 2011, the Company paid $76,780 in finder’s fees and issued 955,800 warrants (See Note 7(C)).

(B) Stock Issued for Services

On October 14, 2008, the Company issued 44,900,000 shares of common stock to its founder having a fair value of $44,900 ($0.001/share) in exchange for services provided.  As a result of the forward split, the 44,900,000 shares were increased to 179,600,000 shares and its purchase price was similarly adjusted to $0.00025((See Note 7(D) and Note 9).

On November 24, 2008, the Company issued 4,000 shares of common stock having a fair value of $1,000 ($0.25/share) in exchange for consulting services.  As a result of the forward split, the 4,000 shares were increased to 16,000 shares and its purchase price was similarly adjusted to $0.0625/share (See Note 7(D)).

On December 5, 2008, the Company issued 4,000 shares of common stock having a fair value of $1,000 ($0.25/share) in exchange for consulting services.  As a result of the forward split, the 4,000 shares were increased to 16,000 shares and its purchase price was similarly adjusted to $0.0625/share (See Note 7(D)).

On December 20, 2008, the Company issued 4,000 shares of common stock having a fair value of $1,000 ($0.25/share) in exchange for consulting services.  As a result of the forward split, the 4,000 shares were increased to 16,000 shares and its purchase price was similarly adjusted to $0.0625/share (See Note 7(D)).

On January 12, 2009, the Company issued 4,000 shares of common stock having a fair value of $1,000 ($0.25/share) in exchange for consulting services.  As a result of the forward split, the 4,000 shares were increased to 16,000 shares and its purchase price was similarly adjusted to $0.0625/share (See Note 7(D)).

On January 14, 2009, the Company issued 20,000 shares of common stock having a fair value of $5,000 ($0.25/share) in exchange for services related to a development services agreement entered on January 19, 2009.  As a result of the forward split, the 20,000 shares were increased to 80,000 shares and its purchase price was similarly adjusted to $0.0625/share (See Note 7(D) and Note 8(B)).

On August 25, 2009, the Company issued 50,000 shares of common stock having a fair value of $3,125 ($0.0625/share), based upon the fair value on the date of grant, in exchange for professional services.

On August 31, 2009, the Company issued 885,714 shares of common stock in exchange for services valued at $62,000 related to the development services agreement entered into on January 19, 2009.  Based on the most recent fair market value at that time, the shares were valued at $55,357 ($0.0625/share), resulting in the recognition of a gain on the extinguishment of debt of $6,643 (See Note 8(B)).

On September 18, 2009, the Company issued 500,000 shares of common stock as compensation pursuant to the terms of a consulting agreement, having a fair value of $175,000 ($0.35/share) based upon fair value on the date of grant.  On November 11, 2009, the Company cancelled the agreement and 300,000 shares of common stock were returned to the Company. As of December 31, 2009, $70,000 is recorded as consulting expense and $105,000 of deferred compensation was reclassified to $0 (See Note 8(B)).

On September 18, 2009, the Company issued 600,000 shares of common stock as compensation pursuant to the terms of a consulting agreement, having a fair value of $210,000 ($0.35/share) based upon fair value on the date of grant.  On November 18, 2009, the Company cancelled the agreement and 400,000 shares of common stock were returned to the Company.  As of December 31, 2009, $70,000 is recorded as consulting expense and $140,000 of deferred compensation was reclassified to $0 (See Note 8(B)).

On September 21, 2009, the Company issued 600,000 shares of common stock as compensation pursuant to the terms of a consulting agreement, having a fair value of $210,000 ($0.35/share) based upon fair value on the date of grant.  On December 18, 2009, the Company terminated the consulting agreement and 400,000 shares were returned to the Company.  As of December 31, 2009, $70,000 is recorded as consulting expense and $140,000 of deferred compensation was reclassified to $0 (See Note 8(B)).

On November 12, 2009, the Company issued 100,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $178,000 ($1.78/share) based upon fair value on the date of grant.  During 2009 and 2010, $11,948 and $89,000 was recorded as consulting expense, respectively.  For the year ended December 31, 2011, $77,052 is recorded as consulting expense and $0 is recorded as deferred compensation (See Note 8(B)).

On November 12, 2009, the Company issued 200,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $400,000 ($2.00/share) based upon fair value on the date of grant.  During 2009 and 2010, $22,466 and $200,000 was recorded as consulting expense, respectively.  For the year ended December 31, 2011, $177,534 is recorded as consulting expense and $0 is recorded as deferred compensation (See Note 8(B)).

On November 16, 2009, the Company issued 100,000 shares of common stock as compensation pursuant to the terms of the consulting agreements, having a fair value of $180,000 ($1.80/share) based upon fair value on the date of grant.  During 2009 and 2010, $11,096 and $90,000 was recorded as consulting expense, respectively.  For the year ended December 31, 2011, $78,904 is recorded as consulting expense and $0 is recorded as deferred compensation (See Note 8(B)).

On November 18, 2009, the Company issued 30,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $45,000 ($1.50/share) based upon fair value on the date of grant.  During 2009, $5,301 was recorded as consulting expense.  For the year ended December 31, 2010, $39,699 was recorded as consulting expense. (See Note 8(B)).

On November 21, 2009, the Company issued 30,000 shares of common stock as compensation pursuant to the terms of the marketing agreement, having a fair value of $53,100 ($1.77/share) based upon fair value on the date of grant.  For the year ended December 31, 2010, $53,100 was recorded as consulting expense (See Note 8(B)).

On December 3, 2009, the Company issued 240,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $468,000 ($1.95/share) based upon fair value on the date of grant.  As of December 31, 2009, $468,000 was recorded as consulting expense (See Note 8(B)).

On December 3, 2009, the Company issued 35,000 shares of common stock as compensation pursuant to the terms of the commission agreement, having a fair value of $68,250 ($1.95/share) based upon fair value on the date of grant.  As of December 31, 2009, $68,250 was recorded as consulting expense (See Note 8(B)).

On December 3, 2009, the Company issued 35,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $68,250 ($1.95/share) based upon fair value on the date of grant.  As of December 31, 2009, $68,250 was recorded as consulting expense (Note 8(B)).

On December 3, 2009, the Company issued 10,000 shares of common stock as compensation pursuant to the terms of the commission agreement, having a fair value of $19,500 ($1.95/share) based upon fair value on the date of grant.  As of December 31, 2009, $19,500 is recorded as consulting expense (See Note 8(B)).

On December 15, 2009, the Company issued 100,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $200,000 ($2.00/share) based upon fair value on the date of grant.  During 2009, $71,111 was recorded as consulting expense.  For the year ended December 31, 2010, $128,889 was recorded as consulting expense (See Note 8(B)).

On December 27, 2009, the Company issued 10,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $19,400 ($1.94/share) based upon fair value on the date of grant.  For the year ended December 31, 2010, $19,400 was recorded as consulting expense (See Note 8(B)).

On December 27, 2009, the Company issued 10,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $19,400 ($1.94/share) based upon fair value on the date of grant.  For the year ended December 31, 2010, $19,400 was recorded as consulting expense (See Note 8(B)).

On December 27, 2009, the Company issued 10,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $19,400 ($1.94/share) based upon fair value on the date of grant.  For the year ended December 31, 2010, $19,400 was recorded as consulting expense (See Note 8(B)).

On December 30, 2009, the Company issued 1,500,000 shares of common stock as compensation pursuant to the terms of the advertising agreement, having a fair value of $2,895,000 ($1.93/share) based upon fair value on the date of grant.  In 2010, the Company cancelled a portion of the agreement and as a result, 1,000,000 shares of common stock were returned to the Company.  For the year ended December 31, 2010, $965,000 was recorded as consulting expense (See Note 8(B)).

On December 31, 2009, the Company issued 75,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $144,750 ($1.93/share) based upon fair value on the date of grant.  For the year ended December 31, 2010, $116,374 was recorded as consulting expense.  For the year ended December 31, 2011, $28,376 is recorded as consulting expense (See Note 8(B)).

On December 31, 2009, the Company issued 75,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $144,750 ($1.93/share) based upon fair value on the date of grant.  For the year ended December 31, 2010, $116,374 was recorded as consulting expense.  For the year ended December 31, 2011, $28,376 is recorded as consulting expense (See Note 8(B)).

On December 31, 2009, the Company issued 500,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $965,000 ($1.93/share) based upon fair value on the date of grant.  For the year ended December 31, 2010, $965,000 was recorded as consulting expense (See Note 8(B)).

During December of 2009, the Company issued 680,000 shares of common stock as compensation pursuant to the terms of the consulting agreements, having a fair value of $1,312,400 ($1.93/share) based upon fair value on the date of grant.  During 2009 and 2010, $2,802 and $709,116 was recorded as consulting expense, respectively.  For the year ended December 31, 2011, $600,482 is recorded as consulting expense and $0 is recorded as deferred compensation (See Note 8(B)).

During December of 2009, the Company issued 600,000 shares of common stock as compensation pursuant to the terms of the consulting agreements, having a fair value of $1,170,000 ($1.95/share) based upon fair value on the date of grant.  During 2009 and 2010, $34,192 and $585,000 was recorded as consulting expense, respectively.  For the year ended December 31, 2011, $550,808 is recorded as consulting expense and $0 is recorded as deferred compensation (See Note 8(B)).

On January 15, 2010, the Company issued 100,000 shares of common stock as compensation pursuant to the terms of the consulting agreement, having a fair value of $170,000 ($1.70/share) based upon fair value on the date of grant.  For the year ended December 31, 2010, $81,507 was recorded as consulting expense.  For the year ended December 31, 2011, $88,493 is recorded as consulting expense and $0 is recorded as deferred compensation (See Note 8(B)).

On February 17, 2010, the Company entered into a twelve month consulting agreement with an unrelated third party effective February 17, 2010.  In exchange for the services provided, the Company issued 1,000,000 shares of common stock having a fair value of $1,240,000 ($1.24/share) based upon fair value on the date of grant.  For the year ended December 31, 2010, $1,066,740 was recorded as consulting expense.  For the year ended December 31, 2011, $173,260 is recorded as consulting expense (See Note 8(B)).

On June 1, 2010, the Company entered into a twelve month consulting agreement for consulting and business services.  As part of the agreement, the Company issued 40,000 shares as a nonrefundable retainer fee having a value of $10,000 ($0.25/share) based upon fair value on the date of the agreement.  (See Note 8(B)).

On July 23, 2010, the Company issued 10,000 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $2,000 ($0.20/share) based upon fair value on the grant date (See Note 8(B)).

On August 1, 2010, the Company issued 200,000 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $40,000 ($0.20/share) based upon fair value on the grant date (See Note 8(B)).

On September 1, 2010, the Company issued 100,000 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $19,000 ($0.19/share) based upon fair value on the grant date (See Note 8(B)).

On October 1, 2010, the Company issued 100,000 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $18,000 ($0.18/share) based upon fair value on the grant date (See Note 8(B)).

On November 1, 2010, the Company issued 100,000 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $25,000 ($0.25/share) based upon fair value on the grant date (See Note 8(B)).

On December 14, 2010, the Company issued 250,000 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $37,500 ($0.15/share) based upon fair value on the grant date (See Note 8(B)).

On January 17, 2011, the Company issued 3,000,000 shares of common stock to its' new CEO pursuant to an employment agreement having a fair value of $300,000 ($0.10/share) based upon fair value on the grant date.  (See Note 8(A)).

On February 17, 2011, the Company issued 500,000 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $55,000 ($0.11/share) based upon fair value on the grant date (See Note 8(B)).

On March 3, 2011, the Company issued 1,000,000 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $80,000 ($0.08/share) based upon fair value on the grant date (See Note 8(B)).

On May 17, 2011, the Company issued 2,000,000 shares of common stock pursuant to an employment agreement having a fair value of $140,000 ($0.07/share) based upon fair value on the grant date.  (See Note 8(A)).

During June 2011, the Company issued 300,000 shares of common stock pursuant to  consulting agreements for consulting services having a fair value of $75,000 ($0.25/share) based upon fair value on the grant date (See Note 8(B)).

On June 15, 2011, the Company issued 15,980 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $1,598 ($0.10/share) based upon the terms of the consulting agreement (See Note 8(B)).

On July 1, 2011, the Company issued 6,500 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $520 ($0.08/share) based upon the terms of the consulting agreement (See Note 8(B)).

On August 14, 2011, the Company issued 2,443 shares of common stock pursuant to two consulting agreements for consulting services having a fair value of $855 ($0.35/share) based upon the terms of the consulting agreements (See Note 8(B)).

On September 12, 2011, the Company issued 2,860 shares of common stock pursuant to two consulting agreements for consulting services having a fair value of $715 ($0.25/share) based upon the terms of the consulting agreements (See Note 8(B)).

On September 18, 2011, the Company issued 15,403 shares of common stock pursuant to two consulting agreements for consulting services having a fair value of $3,388 ($0.22/share) based upon the terms of the consulting agreements (See Note 8(B)).

On September 25, 2011, the Company issued 1,500 shares of common stock pursuant to two consulting agreements for consulting services having a fair value of $585 ($0.39/share) based upon the terms of the consulting agreements (See Note 8(B)).

During the three months ended September 30, 2011, the Company issued 50,482 shares of common stock pursuant to two consulting agreements for consulting services having a fair value of $5,048 ($0.10/share) based upon the terms of the consulting agreements (See Note 8(B)).

On September 19, 2011, the Company issued 100,000 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $23,000 ($0.23/share) based upon the terms of the consulting agreement (See Note 8(B)).

On September 21, 2011, the Company issued 400,000 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $100,000 ($0.25/share) based upon the terms of the consulting agreement (See Note 8(B)).

On September 24, 2011, the Company issued 100,000 shares of common stock pursuant to a consulting agreement for consulting services having a fair value of $33,000 ($0.33/share) based upon the terms of the consulting agreement (See Note 8(B)).

On September 27, 2011, the Company issued 100,000 shares of common stock pursuant to two consulting agreements for consulting services having a fair value of $39,000 ($0.22/share) based upon the terms of the consulting agreements (See Note 8(B)).

During October 2011, the Company issued 123,795 shares of common stock for services having a fair value of $58,184 ($0.47/share).

On October 28, 2011, the Company issued 100,000 shares of common stock for consulting services having a fair value of $88,000 ($0.88/share).

On November 18, 2011, the Company issued 100,000 shares of common stock for consulting services having a fair value of $70,000 ($0.70/share).

During December 2011, the Company issued 200,000 shares of common stock for services having a fair value of $108,000 ($0.54/share).

On December 18, 2011, the Company issued 100,000 shares of common stock for consulting services having a fair value of $50,000 ($0.50/share).

On January 25, 2012 the Company issued 733 shares of common stock pursuant to two consulting agreements for consulting services having a fair value of $455 ($0.62/share) based upon the terms of the consulting agreements (See Note 8(B)).

On March 14, 2012, the Company entered into a settlement agreement with a former employee with relation to the restriction on shares owned by the former employee.  The settlement agreement will lift the restriction on his 6 million shares, and thus agreed to allow the former employee to sell 250,000 of the Company stock per quarter for two years.  In addition, the Company settled a dispute over the termination of the employment agreement by agreeing to give the former employee an additional 150,000 shares to eliminate any dispute over anything owed under his old employment agreement.  He is not an affiliate, not an insider and not a 5% or greater shareholder.  For the six months ended June 30, 2012, the Company issued 150,000 shares of common stock for consulting services having a fair value of $31,500 ($0.21/share), in relation to this settlement agreement.

(C) Common Stock Warrants

On December 30, 2009, the Company issued 500,000 warrants under a consulting agreement. The Company recognized an expense of $823,077 for the year ended December 31, 2009.  The Company recorded the fair value of the warrants  based on the fair value of each warrant grant estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions used for grants in 2009, dividend yield of zero, expected volatility of 112.80%; risk-free interest rates of 1.65%, expected life of three years. The warrants vested immediately.   The warrants expire in three years from the date of issuance and have an exercise price of $0.52 per share.

On May 27, 2010, the Company issued 10,000 warrants under a consulting agreement. The Company recognized an expense of $1,782 for the year ended December 31, 2010.  The Company recorded the fair value of the warrants  based on the fair value of each warrant grant estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions used for grants in 2010, dividend yield of zero, expected volatility of 152.80%; risk-free interest rates of 1.35%, expected life of three years. The warrants vested immediately.   The warrants expire in three years from the date of issuance and have an exercise price of $0.50 per share (See Note 8(B)).

On June 1, 2010, the Company issued 40,000 warrants under a consulting agreement. The Company recognized an expense of $7,184 for the year ended December 31, 2010.  The Company recorded the fair value of the warrants  based on the fair value of each warrant grant estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions used for grants in 2010, dividend yield of zero, expected volatility of 145.70%; risk-free interest rates of 1.26%, expected life of three years.  The warrants vested immediately.  The warrants expire in three years from the date of issuance and have an exercise price of $0.50 per share (See Note 8(B)).

On July 23, 2010, the Company issued 10,000 warrants under a consulting agreement. The Company recognized an expense of $1,593 for the year ended December 31, 2010.  The Company recorded the fair value of the warrants  based on the fair value of each warrant grant estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions used for grants in 2010, dividend yield of zero, expected volatility of 172.90%; risk-free interest rates of 0.94%, expected life of three years. The warrants vested immediately.   The warrants expire in three years from the date of issuance and have an exercise price of $0.50 per share (See Note 8(B)).

During the year ended December 31, 2010, the Company issued 1,200,000 warrants in conjunction with the sale of the Company stock (See Note 7(A)).

On September 2, 2011, the Company issued 955,800 warrants under consulting agreements. The Company recognized an expense of $248,498 for the year ended December 31, 2011.  The Company recorded the fair value of the warrants  based on the fair value of each warrant grant estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions used for grants in 2011, dividend yield of zero, expected volatility of 461.11%; risk-free interest rates of 0.33%, expected life of three years. The warrants vested immediately.   The warrants expire in three years from the date of issuance and have an exercise price of $0.10 per share (See Note 8(B)).

On June 11, 2012, the Company issued 200,000 warrants under consulting agreements. The Company recognized an expense of $48,031 for the six months ended June 30, 2012.  The Company recorded the fair value of the warrants  based on the fair value of each warrant grant estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions used for grants in 2012, dividend yield of zero, expected volatility of 237.76%; risk-free interest rates of 0.19%, expected life of three years. The warrants vested immediately.   The warrants expire in three years from the date of issuance and have an exercise price of $0.25 per share (See Note 8(B)).

The following tables summarize all warrant grants as of June 30, 2012 and June 30, 2011, and the related changes during these periods are presented below:

	Number of Warrants		Weighted Average Exercise Price
Stock Warrants
Balance at December 31, 2010		1,760,000	$	0.51
Granted		955,800		0.10
Exercised
Forfeited
Balance at December 31, 2011		2,715,800	$	0.36
Granted		200,000	$	0.25
Exercised		-
Forfeited		-
Balance at June 30, 2012		2,915,800	$	0.36
Options Exercisable at June 30, 2012		2,915,800	$	0.36
Weighted Average Fair Value of Options Granted			$	0.36

Warrants Outstanding								Warrants Exercisable
Range of Exercise Price		Number Outstanding at June 30, 2012		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price		Number Exercisable at June 30, 2012		Weighted Average Exercise Price
$	0.52		500,000		0.50	$	0.52		500,000	$	0.52
$	0.50		1,260,000		0.85	$	0.50		1,260,000	$	0.50
$	0.10		955,800		2.17	$	0.10		955,800	$	0.10
$	0.25		200,000		2.95	$	0.25		200,000	$	0.25

Warrants Outstanding								Warrants Exercisable
Range of Exercise Price		Number Outstanding at June 30, 2011		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price		Number Exercisable at June 30, 2011		Weighted Average Exercise Price
$	0.52		500,000		1.50	$	0.52		500,000	$	0.52
$	0.50		1,260,000		1.99	$	0.50		1,260,000	$	0.50

In connection with the warrants issued for cash and services, the Company has an aggregate of 2,915,800 and 1,760,000 warrants outstanding as of June 30, 2012 and 2011, respectively.  As of June 30, 2012, the Company has reserved 2,915,800 shares of common stock for the future exercise of the warrants.

(D) Stock Split Effected in the Form of a Stock Dividend

On January 16, 2009, the Company's Board of Directors declared a four-for-one stock split to be effected in the form of a stock dividend.  The stock split was distributed on January 16, 2009 to shareholders of record.  A total of 136,713,000 shares of common stock were issued.  All basic and diluted loss per share and average shares outstanding information has been adjusted to reflect the aforementioned stock dividend.

(E) Amendment to Articles of Incorporation

On January 27, 2009, the Company amended its Articles of Incorporation to provide for an increase in its authorized share capital. The authorized capital stock increased to 250,000,000 common shares at a par value of $0.001 per share, and 10,000,000 preferred shares at a par value of $0.001 with class and series designations, voting rights, and relative rights and preferences to be determined by the Board of Directors of the Company from time to time.

On June 2, 2010, the Company amended its Articles of Incorporation to provide for an increase in its authorized share capital. The authorized capital stock increased to 295,000,000 common shares at a par value of $0.001 per share.

On September 20, 2010, the Company amended its Articles of Incorporation to provide for an increase in its authorized share capital and a change in the par value per share. The authorized capital stock increased to 400,000,000 common shares at a par value of $0.0001 per share.

Effective March 1, 2011, the Company filed with the State of Delaware a Certificate of Amendment of Certificate of Incorporation changing our name from So Act Network, Inc. to Max Sound Corporation.

(F) In Kind Contribution

During the fourth quarter of 2008, a former stockholder of the Company paid $4,400 of operating expenses on behalf of the Company.

During the fourth quarter of 2008, the principal stockholder contributed office space with a fair market value of $2,913 (See Note 9).

For the year ended December 31, 2009, the principal stockholder contributed office space with a fair market value of $12,600 (See Note 9).

For the year ended December 31, 2010, the principal stockholder contributed office space with a fair value of $9,450 (See Note 9).

(G) Share Conversion

On June 2, 2010, a principal stockholder converted $283,652 of accrued compensation into 945,507 shares of common stock at $0.30 per share (See Note 9).

On February 17, 2011, a principal stockholder converted $144,000 of accrued compensation into 1,309,091 shares of common stock at $0.11 per share (See Note 9).

On February 17, 2011, a principal stockholder converted $100,000 of a line of credit owed into 909,091 shares of common stock at $.011 per share (See Note 4 and Note 9).

On January 18, 2011, the Company entered into a conversion agreement executed by a note holder for 109,375 shares based on a conversion price of $0.032 per share (See Note 6).

On February 9, 2011, the Company entered into a conversion agreement executed by a note holder for 271,186 shares based on a conversion price of $0.0295 per share (See Note 6).

On February 15, 2011, the Company entered into a conversion agreement executed by a note holder for 357,143 shares based on a conversion price of $0.0336 per share (See Note 6).

On February 23, 2011, the Company entered into a conversion agreement executed by a note holder for 220,264 shares based on a conversion price of $0.0454 per share (See Note 6).

On April 11, 2011, the Company entered into a conversion agreement executed by a note holder for 587,382 shares based on a conversion price of $0.0315 per share (See Note 6).

On August 25, 2011, the Company entered into a conversion agreement executed by a note holder for 77,220 shares based on a conversion price of $0.1554 per share (See Note 6).

On August 30, 2011, the Company entered into a conversion agreement executed by a note holder for 96,220 shares based on a conversion price of $0.1455 per share (See Note 6).

On September 12, 2011, the Company entered into a conversion agreement executed by a note holder for 116,505 shares based on a conversion price of $0.1339 per share (See Note 6).

(H) Share Exchange

On May 11, 2010, the Company acquired the rights to an audio technology known as Max Audio Technology (Max) through a share exchange, whereby the Company issued 30,000,000 shares of common stock to two individuals in exchange for their rights in Max having a value of $7,500,000 based upon recent market value ($0.25/share) (See Note 8(B)).

On January 17, 2011, the Company acquired the rights to software technology known as Blog Software, Social Media Vault, Social Media Bar and Trending Topix (BSST) through a share exchange, whereby the Company issued 3,000,000 shares of common stock to two individuals in exchange for their rights to BSST having a value of $300,000 based upon recent market value ($0.10/share).

(I) Stock Options

On January 17, 2011, the Company issued 12,000,000 options to buy common shares of the Company's stock at $0.12 per share, good for three years, to its' new CEO pursuant to an employment agreement.  The Company recognized an expense of $1,199,794 for the year ended December 31, 2011.  The Company recorded the fair value of the options  based on the fair value of each option grant estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions used for grants in 2010; dividend yield of zero, expected volatility of 436.04%, risk-free interest rates of 1.00%, expected life of three years.  The options vest immediately (See Note 8 (A)).

The following tables summarize all warrant grants as of June 30, 2012 and June 30, 2011, and the related changes during these periods are presented below:

	Number of Options		Weighted Average Exercise Price
Stock Options
Balance at December 31, 2011		12,000,000	$	0.12
Granted		-	$	-
Exercised		-
Forfeited		-
Balance at June 30, 2012		12,000,000	$	0.12
Options Exercisable at June 30, 2012		12,000,000	$	0.12
Weighted Average Fair Value of Options Granted			$	0.12

Options Outstanding								Options Exercisable
Range of Exercise Price		Number Outstanding at June 30, 2012		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price		Number Exercisable at June 30, 2012		Weighted Average Exercise Price
$	0.12		12,000,000		1.55	$	0.12		12,000,000	$	0.12

Options Outstanding								Options Exercisable
Range of Exercise Price		Number Outstanding at June 30, 2011		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price		Number Exercisable at June 30, 2011		Weighted Average Exercise Price
$	-		-		-	$	-		-	$	-

In connection with the options issued for cash and services, the Company has an aggregate of 12,000,000 and 0 options outstanding as of June 30, 2012 and 2011, respectively.  As of June 30, 2012, the Company has reserved 12,000,000 shares of common stock for the future exercise of the options.

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Related Party Transactions

6 Months Ended

Jun. 30, 2012

Related Party Transactions [Abstract]

RELATED PARTY TRANSACTIONS

NOTE 9             RELATED PARTY TRANSACTIONS

During the year ended December 31, 2008, the Company received $18,803 from the principal stockholder.  Pursuant to the terms of the loan, the loan is bearing an annual interest rate of 3.25% and due on demand.  In 2008, the Company repaid $15,000 in principal to the principal stockholder.  In 2009, the Company repaid $3,803 in principal to the principal stockholder.  As of December 31, 2010, the principal portion of this principal stockholder loan balance has been repaid (See Note 3).

On May 11, 2009, the Company received $9,500 from a principal stockholder. During the year ended December 31, 2009, the Company repaid $1,500 in principal to the principal stockholder.  Pursuant to the terms of the loan, the loan is bearing an annual interest rate of 3.25% and is due on demand (See Note 3).

On May 22, 2009, the Company received $15,000 from a principal stockholder.  During the year ended December 31, 2010, the Company repaid $6,000 in principal to a principal stockholder under the terms of the loan.  Pursuant to the terms of the loan, the loan is bearing an annual interest rate of 3.25% and is due on demand (See Note 3).

On May 26, 2009, the Company received $16,700 from a principal stockholder.  During the year ended December 31, 2010, the Company repaid $15,700 in principal to the principal stockholder under the terms of this loan.  Pursuant to the terms of the loan, the loan is bearing an annual interest rate of 3.25% and is due on demand (See Note 3).

During the year ended December 31, 2011, the Company repaid $18,000 in principal and $2,116 of accrued interest to the principal stockholder related to these principal loans (See Note 3).

On May 28, 2009, the Company entered into a two year line of credit agreement with a principal stockholder in the amount of $100,000.  The line of credit carries an interest rate at 3.25%.  As of December 31, 2011, the principal shareholder has advanced the Company $100,000 under the terms of this line of credit agreement (See Note 4).

On November 10, 2009, the Company entered into a two year line of credit agreement with a principal stockholder in the amount of $100,000.  The line of credit carries an interest rate at 3.25%.  As of December 31, 2011, the principal shareholder has advanced $100,000 to the Company under the terms of this line of credit agreement (See Note 4).

On March 25, 2010, the Company entered into a two year line of credit agreement with the principal stockholder in the amount of $500,000.  The line of credit carries an interest rate of 3.25%.  On February 17, 2011, the principal stockholder converted $100,000 of the line of credit owed into 909,091 shares of common stock at $0.11 per share.  As of December 31, 2011, the principal stockholder has advanced $360,580 to the Company under this line of credit agreement (See Note 7(G) and Note 4).

As of December 31, 2011, the Company repaid $460,580 in principal and $11,283 of accrued interest to the principal stockholder related to these lines of credit (See Note 4).

On October 14, 2008, the Company issued 44,900,000 shares of common stock to its founder having a fair value of $44,900 ($0.001/share) in exchange for services provided.  As a result of the forward split, the 44,900,000 shares were increased to 179,600,000 shares and its purchase price was similarly adjusted to $0.00025 (See Note 7(B) and Note 7(D)).

On October 13, 2008, the Company executed an employment agreement with its President and CEO.  The term of the agreement is ten years.  As compensation for services, the President will receive a monthly compensation of $18,000 beginning October 13, 2008.  In addition, to the base salary, the employee is entitled to receive a 10% commission of all sales of the Corporation.  The agreement also calls for the employee to receive health benefits (See Note 8(A)).

On June 2, 2010, a principal stockholder converted $283,652 of accrued compensation into 945,507 shares of common stock at $0.30 per share.  (See Note 7(G)).

On February 17, 2011, a principal stockholder converted $144,000 of accrued compensation into 1,309,091 shares of common stock at $.0.11 per share. (See Note 7(G)).

During the fourth quarter of 2008, the principal stockholder contributed office space with a fair market value of $2,913 (See Note 7(F)).

For the year ended December 31, 2009, the principal stockholder contributed office space with a fair market value of $12,600 (See Note 7(F)).

For the year ended December 31, 2010, the principal stockholder contributed office space with a fair value of $9,450 (See Note 7(F)).

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Stockholders' Equity (Details 3) (Stock Option [Member], Exercise Price Range [Member], USD $)	6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Stock Option [Member] | Exercise Price Range [Member]
Warrants outstanding and exercisable activity
Outstanding, Range of Exercise Price	$ 0.12
Outstanding, Number Outstanding at June 30, 2012	12,000,000
Outstanding, Weighted Average Remaining Contractual Life	1 year 6 months 18 days
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Outstanding Options, Weighted Average Exercise Price	$ 0.12
Exercisable, Number Exercisable at June 30, 2012	12,000,000
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Exercisable Options, Weighted Average Exercise Price	$ 0.12

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Convertible Debts (Tables)

6 Months Ended

Jun. 30, 2012

Fair Value Assumption 1 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Summary of assumptions used in measuring fair value

Exercise price		$0.1377
Expected dividends		0	%
Expected volatility		172.27	%
Expected term: conversion feature	267 days
Risk free interest rate		0.32	%

Fair Value Assumption Remeasurement 1 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Summary of assumptions used in measuring fair value

Exercise price	$0.0393
Expected dividends	0	%
Expected volatility	471.81	%
Risk fee interest rate	0.30	%
Expected life of conversion feature in days	0

Fair Value Assumption 2 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Summary of assumptions used in measuring fair value

Exercise price		$0.0738
Expected dividends		0	%
Expected volatility		456.63	%
Expected term: conversion feature	365 days
Risk free interest rate		0.27	%

Fair Value Assumption Remeasurement 2 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Summary of assumptions used in measuring fair value

Exercise price	$0.035
Expected dividends	0	%
Expected volatility	514.06	%
Risk fee interest rate	0.19	%
Expected life of  conversion feature in days	140

Fair Value Assumption 3 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Summary of assumptions used in measuring fair value

Exercise price		$0.2629
Expected dividends		0	%
Expected volatility		228.76	%
Expected term: conversion feature	365 days
Risk free interest rate		0.18	%

Fair Value Assumption Remeasurement 3 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Summary of assumptions used in measuring fair value

Exercise price	$0.2331
Expected dividends	0	%
Expected volatility	233.04	%
Risk fee interest rate	0.21	%
Expected life of  conversion feature in days	252

Fair Value Assumption 4 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Summary of assumptions used in measuring fair value

Exercise price		$0.1490
Expected dividends		0	%
Expected volatility		228.61	%
Expected term: conversion feature	280 days
Risk free interest rate		0.21	%

Fair Value Assumption Remeasurement 4 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Summary of assumptions used in measuring fair value

Exercise price	$0.2080
Expected dividends	0	%
Expected volatility	233.04	%
Risk fee interest rate	0.21	%
Expected life of  conversion feature in days	172

Fair Value Assumption 5 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Summary of assumptions used in measuring fair value

Exercise price		$0.2077
Expected dividends		0	%
Expected volatility		232.90	%
Expected term: conversion feature	268 days
Risk free interest rate		0.19	%

Fair Value Assumption Remeasurement 5 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Summary of assumptions used in measuring fair value

Exercise price	$0.2240
Expected dividends	0	%
Expected volatility	233.04	%
Risk fee interest rate	0.21	%
Expected life of  conversion feature in days	181

Fair Value Assumption 6 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Summary of assumptions used in measuring fair value

Exercise price		$0.1797
Expected dividends		0	%
Expected volatility		240.78	%
Expected term: conversion feature	365 days
Risk free interest rate		0.18	%

Fair Value Assumption Remeasurement 6 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Summary of assumptions used in measuring fair value

Exercise price	$0.2240
Expected dividends	0	%
Expected volatility	233.04	%
Risk fee interest rate	0.21	%
Expected life of  conversion feature in days	299

Fair Value Assumption 7 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Summary of assumptions used in measuring fair value

Exercise price		$0.2030
Expected dividends		0	%
Expected volatility		240.90	%
Expected term: conversion feature	60 days
Risk free interest rate		0.18	%

Fair Value Assumption Remeasurement 7 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Summary of assumptions used in measuring fair value

Exercise price	$0.2240
Expected dividends	0	%
Expected volatility	233.04	%
Risk fee interest rate	0.21	%
Expected life of  conversion feature in days	7

Fair Value Assumption 8 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Summary of assumptions used in measuring fair value

Exercise price		$0.1647
Expected dividends		0	%
Expected volatility		234.89	%
Expected term: conversion feature	278 days
Risk free interest rate		0.19	%

Fair Value Assumption Remeasurement 8 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Summary of assumptions used in measuring fair value

Exercise price	$0.2240
Expected dividends	0	%
Expected volatility	233.04	%
Risk fee interest rate	0.21	%
Expected life of conversion feature  in days	270

XML

Line of Credit - Principal Stockholder (Details) (USD $)	1 Months Ended								1 Months Ended
	Mar. 31, 2010	Nov. 30, 2009	May 31, 2009	Dec. 31, 2011	Feb. 17, 2011	Mar. 25, 2010	Nov. 10, 2009	May 28, 2009	Feb. 28, 2011 Principal Owner [Member]	Mar. 31, 2010 Principal Owner [Member]	Nov. 30, 2009 Principal Owner [Member]	May 31, 2009 Principal Owner [Member]	Dec. 31, 2011 Principal Owner [Member]	Feb. 17, 2011 Principal Owner [Member]	Dec. 31, 2010 Principal Owner [Member]
Line of Credit - Principal Stockholder (Textual)
Term of line of credit	2 years	2 years	2 years							2 years	2 years	2 years
Principal stockholder amount advanced to company						$ 500,000	$ 100,000	$ 100,000					$ 100,000		$ 100,000
Principal stockholder amount advanced to company 1													100,000
Principal stockholder amount advanced to company 2													360,580
Line of credit, interest rate	3.25%	3.25%	3.25%							3.25%	3.25%	3.25%
Amount repaid to principal stockholder under line of credit agreement				100,000									460,580
Principal stockholder converted line of credit into common stock, shares									909,091
Principal stockholder converted line of credit into common stock, amount									100,000
Common stock price per share					$ 0.11									$ 0.11
Accrued interest on line of credit													$ 11,283

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Condensed Statement of Changes in Stockholders' Equity (Unaudited) (USD $)	Total	Preferred Stock	Common Stock	Additional Paid-In Capital	Accumulated Deficit	Subscription Receivable	Deferred Compensation
Beginning Balance at Dec. 08, 2005
Beginning Balance, (Shares) at Dec. 08, 2005
Stock issued on acceptance of incorporation expenses	100		10	90
Stock issued on acceptance of incorporation expenses (shares)			100,000
Net Loss	(400)				(400)
Balance at Dec. 31, 2005	(300)		10	90	(400)
Balance, (Shares) at Dec. 31, 2005			100,000
Net Loss	(1,450)				(1,450)
Balance at Dec. 31, 2006	(1,750)		10	90	(1,850)
Balance, (Shares) at Dec. 31, 2006			100,000
Net Loss	(1,400)				(1,400)
Balance at Dec. 31, 2007	(3,150)		10	90	(3,250)
Balance, (Shares) at Dec. 31, 2007			100,000
Common stock issued for services to founder ($0.001/sh)	44,900		4,490	40,410
Common stock issued for services to founder ($0.001/sh), shares			44,900,000
Common stock issued for cash ($0.25/sh)	50,500		47	118,203		(67,750)
Common stock issued for cash ($0.25/sh), shares			473,000
Common stock issued for services ($0.25/sh)	3,000		1	2,999
Common stock issued for services ($0.25/sh), shares			12,000
Shares issued in connection with stock dividend			13,646	122,809	(136,455)
Shares issued in connection with stock dividend (Shares)			136,455,000
In kind contribution of rent - related party				2,913
Accrued expenses payment made by a former shareholder	4,400			4,400
Net Loss	(117,115)				(117,115)
Balance at Dec. 31, 2008	(14,552)		18,194	291,824	(256,820)	(67,750)
Balance, (Shares) at Dec. 31, 2008			181,940,000
Common stock issued for cash ($0.25/sh)	15,500		6	15,494
Common stock issued for cash ($0.25/sh), shares			62,000
Common stock issued for services ($0.25/sh)	6,000		2	5,998
Common stock issued for services ($0.25/sh), shares			24,000
Common stock issued for services ($0.35/sh)	95,667		170	594,830			(499,333)
Common stock issued for services ($0.35/sh) (Shares)			1,700,000
Common stock issued for services ($0.0625/sh)	58,482		94	58,388
Common stock issued for services ($0.0625/sh) (Shares)			935,714
Common stock issued for services ($1.50/sh)	5,301		3	44,997			(39,699)
Common stock issued for services ($1.50/sh) (Shares)			30,000
Warrants issued for services	823,077			823,077
Common stock issued for services ($1.77/sh)			3	53,097			(53,100)
Common stock issued for services ($1.77/sh) (Shares)			30,000
Common stock issued for services ($1.78/sh)	11,948		10	177,990			(166,052)
Common stock issued for services ($1.78/sh) (Shares)			100,000
Common stock issued for services ($1.80/sh)	11,096		10	179,990			(168,904)
Common stock issued for services ($1.80/sh) (Shares)			100,000
Common stock issued for services ($1.93/sh)	2,802		283	5,461,617			(5,459,098)
Common stock issued for services ($1.93/sh) (Shares)			2,830,000
Common stock issued for services ($1.94/sh)			3	58,197			(58,200)
Common stock issued for services ($1.94/sh) (Shares)			30,000
Common stock issued for services ($1.95/sh)	658,192		92	1,793,908			(1,135,808)
Common stock issued for services ($1.95/sh) (Shares)			920,000
Common stock issued for services ($2.00/sh)	93,577		30	599,970			(506,423)
Common stock issued for services ($2.00/sh) (Shares)			300,000
Return of common stock issued for services ($0.35/sh)			(110)	(384,890)			385,000
Return of common stock issued for services ($0.35/sh) (Shares)			(1,100,000)
Shares issued in connection with stock dividend			26	(26)
Shares issued in connection with stock dividend (Shares)			258,000
Stock offering costs	(850)			(850)
Collection of subscription receivable	67,750					67,750
In kind contribution of rent - related party	12,600			12,600
Deferred compensation realized	114,333						114,333
Net Loss	(2,298,552)				(2,298,552)
Balance at Dec. 31, 2009	(337,629)		18,816	9,786,211	(2,555,372)		(7,587,284)
Balance, (Shares) at Dec. 31, 2009			188,159,714
Common stock issued for cash ($0.25/sh)	300,000		120	299,880
Common stock issued for cash ($0.25/sh), shares			1,200,000
Accrued salary conversion into common stock ($0.30/sh)	283,652		95	283,557
Accrued salary conversion into common stock ($0.30/sh) (Shares)			945,507
Common stock issued for services ($0.15/sh)	37,500		25	37,475
Common stock issued for services ($0.15/sh) (Shares)			250,000
Common stock issued for services ($0.18/sh)	18,000		10	17,990
Common stock issued for services ($0.18/sh) (Shares)			100,000
Common stock issued for services ($0.19/sh)	19,000		10	18,990
Common stock issued for services ($0.19/sh) (Shares)			100,000
Common stock issued for services ($0.20/sh)	42,000		21	41,979
Common stock issued for services ($0.20/sh) (Shares)			210,000
Common stock issued for services ($0.25/sh)	35,000		14	34,986
Common stock issued for services ($0.25/sh), shares			140,000
Common stock issued in exchange for technology rights ($0.25/sh)	7,500,000		3,000	7,497,000
Common stock issued in exchange for technology rights ($0.25/sh) (Shares)			30,000,000
Return of common stock issued for services ($1.05/sh)			(15)	15
Return of common stock issued for services ($1.05/sh) (Shares)			(150,000)
Common stock issued for services ($1.24/Sh)	142,685		100	1,239,900			(1,097,315)
Common stock issued for services ($1.24/Sh) (Shares)			1,000,000
Common stock issued for services ($1.70/sh)	17,466		10	169,990			(152,534)
Common stock issued for services ($1.70/sh) (Shares)			100,000
Cancellation of shares held in escrow ($1.93/sh)	(1,442,198)		(100)	(1,929,900)			487,802
Cancellation of shares held in escrow ($1.93/sh) (Shares)			(1,000,000)
Warrants issued for services	10,559			10,559
Blue sky fees	(400)			(400)
Stock offering costs	(8,000)			(8,000)
In kind contribution of rent - related party	9,450	9,450
Deferred compensation realized	6,546,046						6,546,046
Net Loss	(6,312,965)				(6,312,965)
Balance at Dec. 31, 2010	6,860,166		22,106	17,509,682	(8,868,337)		(1,803,285)
Balance, (Shares) at Dec. 31, 2010	0		221,055,221
Common stock issued in exchange for assets ($.10/sh)	300,000		300	299,700
Common stock issued in exchange for assets ($.10/sh) (Shares)			3,000,000
Common stock issued for services ($0.07/sh)	140,000		200	139,800
Common stock issued for services ($0.07/sh) (Shares)			2,000,000
Common stock issued for services ($0.08/sh)	80,520		101	80,419
Common stock issued for services ($0.08/sh) (Shares)			1,006,500
Common stock issued for services ($.10/sh)	306,646		307	306,339
Common stock issued for services ($.10/sh) (Shares)			3,066,462
Common stock issued for services ($0.11/sh)	55,000		50	54,950
Common stock issued for services ($0.11/sh) (Shares)			500,000
Common stock issued for services ($0.22/sh)	3,389		2	3,387
Common stock issued for services ($0.22/sh) (Shares)			$ 15,403
Common stock issued for services ($0.23/sh)	23,000		10	22,990
Common stock issued for services ($0.23/sh) (Shares)			100,000
Common stock issued for services ($0.25/sh)	175,715		70	175,645
Common stock issued for services ($0.25/sh), shares			702,860
Common stock issued for services ($0.33/sh)	33,000		10	32,990
Common stock issued for services ($0.33/sh) (Shares)			100,000
Common stock issued for services ($0.35/sh)	855			855
Common stock issued for services ($0.35/sh) (Shares)			2,443
Common stock issued for services ($0.39/sh)	39,585		10	39,575
Common stock issued for services ($0.39/sh) (Shares)			101,500
Common stock issued for services ($0.47/sh)	58,184		12	58,172
Common stock issued for services ($0.47/sh) (Shares)			123,795
Common stock issued for services ($0.50/sh)	50,000		10	49,990
Common stock issued for services ($0.50/sh) (Shares)			100,000
Common stock issued for services ($0.54/sh)	108,000		20	107,980
Common stock issued for services ($0.54/sh) (Shares)			200,000
Common stock issued for services ($0.70/sh)	70,000		10	69,990
Common stock issued for services ($0.70/sh) (Shares)			100,000
Common stock issued for services ($0.88/sh)	88,000		10	87,990
Common stock issued for services ($0.88/sh) (Shares)			100,000
Warrants issued for services	248,498			248,498
Convertible debt conversion into common stock ($0.0295/sh)	8,000		27	7,973
Convertible debt conversion into common stock ($0.0295/sh) (Shares)			271,186
Convertible debt conversion into common stock ($0.0315/sh) (Shares)			587,382
Convertible debt conversion into common stock ($0.0315/sh)	18,503		59	18,444
Convertible debt conversion into common stock ($0.032/sh)	3,500		11	3,489
Convertible debt conversion into common stock ($0.032/sh) (Shares)			109,375
Convertible debt conversion into common stock ($0.0336/sh)	12,000		36	11,964
Convertible debt conversion into common stock ($0.0336/sh) (Shares)			357,143
Convertible debt conversion into common stock ($0.0454/sh)	10,000		22	9,978
Convertible debt conversion into common stock ($0.0454/sh) (Shares)			220,264
Convertible debt conversion into common stock ($0.1339/sh)	15,600		12	15,588
Convertible debt conversion into common stock ($0.1339/sh) (Shares)			116,505
Convertible debt conversion into common stock ($0.1455/sh)	14,000		9	13,991
Convertible debt conversion into common stock ($0.1455/sh) (Shares)			96,220
Convertible debt conversion into common stock ($0.1554/sh)	12,000		8	11,992
Convertible debt conversion into common stock ($0.1554/sh) (Shares)			77,220
Accrued salary conversion into common stock ($0.11/sh)	144,000		131	143,869
Accrued salary conversion into common stock ($0.11/sh), shares			1,309,091
Line of credit conversion into common stock ($0.11/sh)	100,000		91	99,909
Line of credit conversion into common stock ($0.11/sh) (Shares)				909,091
Common stock issued for cash ($0.10/sh)	1,885,700		1,886	1,883,814
Common stock issued for cash ($0.10/sh) (Shares)			18,857,000
Stock offering costs	(79,780)			(79,780)
Amortization of stock options	1,199,794			1,199,794
Deferred compensation realized	1,803,285						1,803,285
Net Loss	(5,491,647)				(5,491,647)
Balance at Dec. 31, 2011	8,295,512		25,519	22,629,977	(14,359,984)
Balance, (Shares) at Dec. 31, 2011			255,184,661
Warrants issued for services	48,031			48,031
Common stock issued for services ($0.62/sh)	455			455
Common stock issued for services ($0.62/sh), (Shares)			733
Common stock issued for services ($0.21/sh)	31,500		15	31,485
Common stock issued for services ($0.21/sh), (Shares)			150,000
Net Loss	(1,434,267)				(1,434,267)
Balance at Jun. 30, 2012	$ 6,941,231		$ 25,534	$ 22,709,948	$ (15,794,251)
Balance, (Shares) at Jun. 30, 2012			255,335,394

XML

Note Payable - Principal Stockholder

6 Months Ended

Jun. 30, 2012

Debt Disclosure [Abstract]

Note Payable - Principal Stockholder

NOTE 3             NOTE PAYABLE – PRINCIPAL STOCKHOLDER

During the year ended December 31, 2008, the Company received $18,803 from the principal stockholder.  Pursuant to the terms of the loan, the loan is bearing an annual interest rate of 3.25% and due on demand.  In 2008, the Company repaid $15,000 in principal to the principal stockholder.  In 2009, the Company repaid $3,803 in principal to the principal stockholder.  As of December 31, 2010, the principal portion of this principal stockholder loan balance has been repaid (See Note 9).

On May 11, 2009, the Company received $9,500 from the principal stockholder.  During the year ended December 31, 2009, the Company repaid $1,500 in principal to the principal stockholder.  Pursuant to the terms of the loan, the loan is bearing an annual interest rate of 3.25% and is due on demand (See Note 9).

On May 22, 2009, the Company received $15,000 from the principal stockholder.  During the year ended December 31, 2010, the Company repaid $6,000 in principal to the principal stockholder under the terms of the loan.  Pursuant to the terms of the loan, the loan is bearing an annual interest rate of 3.25% and is due on demand (See Note 9).

On May 26, 2009, the Company received $16,700 from the principal stockholder.  During the year ended December 31, 2010, the Company repaid $15,700 in principal to the principal stockholder under the term of this loan.  Pursuant to the terms of the loan, the loan is bearing an annual interest rate of 3.25% and is due on demand (See Note 9).

During the year ended December 31, 2011, the Company repaid $18,000 in principal and $2,116 of accrued interest to the principal stockholder related to these principal stockholder loans (See Note 9).

XML

Property and Equipment (Details) (USD $)	Jun. 30, 2012	Dec. 31, 2011
Summary of property and equipment
Less accumulated depreciation and amortization	$ (144,894)	$ (122,540)
Property and equipment, net	221,046	146,000
Website Development [Member]
Summary of property and equipment
Property and Equipment, Gross	187,723	127,722
Furniture and Equipment [Member]
Summary of property and equipment
Property and Equipment, Gross	103,906	103,906
Leasehold Improvements [Member]
Summary of property and equipment
Property and Equipment, Gross	6,573	6,573
Software [Member]
Summary of property and equipment
Property and Equipment, Gross	29,963	18,888
Office Equipment [Member]
Summary of property and equipment
Property and Equipment, Gross	35,647	9,323
Internet Domain Names [Member]
Summary of property and equipment
Property and Equipment, Gross	1,500	1,500
Sign [Member]
Summary of property and equipment
Property and Equipment, Gross	$ 628	$ 628

XML

Related Party Transactions (Details) (USD $)	1 Months Ended			12 Months Ended																																																																				6 Months Ended	1 Months Ended	6 Months Ended	1 Months Ended				3 Months Ended	12 Months Ended
	Mar. 31, 2010	Nov. 30, 2009	May 31, 2009	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009	Dec. 31, 2008	Jun. 30, 2012	Sep. 30, 2011	Sep. 27, 2011	Sep. 25, 2011	Sep. 24, 2011	Sep. 21, 2011	Sep. 19, 2011	Sep. 18, 2011	Sep. 12, 2011	Aug. 31, 2011	Aug. 14, 2011	Jul. 31, 2011	Jul. 01, 2011	Jun. 30, 2011	Jun. 15, 2011	May 17, 2011	May 02, 2011	Mar. 21, 2011	Mar. 03, 2011	Feb. 23, 2011	Feb. 17, 2011	Jan. 24, 2011	Dec. 14, 2010	Nov. 01, 2010	Oct. 01, 2010	Aug. 31, 2010	Aug. 05, 2010	Jul. 31, 2010	Jul. 23, 2010	Jun. 02, 2010	May 31, 2010	May 27, 2010	Mar. 25, 2010	Feb. 17, 2010	Jan. 15, 2010	Dec. 30, 2009	Dec. 27, 2009	Dec. 15, 2009	Dec. 03, 2009	Nov. 21, 2009	Nov. 18, 2009	Nov. 16, 2009	Nov. 12, 2009	Nov. 10, 2009	Sep. 21, 2009	Sep. 18, 2009	Aug. 31, 2009	Aug. 25, 2009	May 28, 2009	May 26, 2009	May 22, 2009	May 11, 2009	Jan. 31, 2009	Jan. 15, 2009	Jan. 14, 2009	Jan. 12, 2009	Jan. 11, 2009	Jan. 03, 2009	Jan. 02, 2009	Dec. 20, 2008	Dec. 05, 2008	Nov. 24, 2008	Oct. 14, 2008	Dec. 31, 2005	Jun. 30, 2012 Employment Contracts [Member]	Oct. 31, 2008 Employment Contracts [Member] President [Member]	Jun. 30, 2012 Employment Contracts [Member] President [Member]	Feb. 28, 2011 Principal stockholder [Member]	Mar. 31, 2010 Principal stockholder [Member]	Nov. 30, 2009 Principal stockholder [Member]	May 31, 2009 Principal stockholder [Member]	Dec. 31, 2008 Principal stockholder [Member]	Dec. 31, 2010 Principal stockholder [Member]	Dec. 31, 2009 Principal stockholder [Member]	Dec. 31, 2008 Principal stockholder [Member]	Dec. 31, 2011 Principal stockholder [Member]	Feb. 17, 2011 Principal stockholder [Member]	Jun. 02, 2010 Principal stockholder [Member]	Mar. 25, 2010 Principal stockholder [Member]	Nov. 10, 2009 Principal stockholder [Member]	May 28, 2009 Principal stockholder [Member]	May 26, 2009 Principal stockholder [Member]	May 22, 2009 Principal stockholder [Member]	May 11, 2009 Principal stockholder [Member]
Related Party Transactions (Textual)
Notes payable, related parties							$ 18,803																																																		$ 16,700	$ 15,000	$ 9,500																				$ 18,803			$ 18,803							$ 16,700	$ 15,000	$ 9,500
Interest rate, related party transaction				3.25%	3.25%	3.25%	3.25%																																																																									3.25%	3.25%	3.25%
Principal amount of notes payable repaid, related party transactions				18,000	6,000	3,803	15,000																																																				1,500																														15,700
Accrued interest on notes payable, related party transaction				2,116																																																																															2,116
Term of line of credit	2 years	2 years	2 years																																																																									2 years	2 years	2 years
Line of credit facility amount under line of credit agreement																																																																																						500,000	100,000	100,000
Principal stockholder amount advanced to company																																								500,000											100,000					100,000																								100,000			100,000
Principal stockholder amount advanced to company 1																																																																																			100,000
Line of credit, interest rate	3.25%	3.25%	3.25%																																																																									3.25%	3.25%	3.25%
Amount repaid to principal stockholder under line of credit agreement				100,000																																																																															460,580
Amount repaid to related party under line of credit agreement 2																																																																																			255,480
Principal stockholder converted line of credit into common stock, shares																																																																											909,091
Principal stockholder converted line of credit into common stock, amount																																																																											100,000
Accrued interest on line of credit																																																																																			11,283
Term period of agreement																																																																								10 years	10 years	10 years
Compensation for services																																																																								8,500	18,000	18,000
Percentage commission on sales																																																																								5.00%	10.00%	10.00%
Amount of accrued compensation converted into shares																												144,000									283,652																																															144,000	283,652
Number of common shares converted form accrued compensation																												1,309,091									945,507																																															1,309,091	945,507
Par value of share converted form accrued compensation																												$ 0.11									$ 0.30																																															$ 0.11	$ 0.30
In kind contribution of rent - related party					9,450	12,600																																																																									2,913	9,450	12,600
Common stock issued for services to founder ($0.001/sh)							$ 44,900
Per share price of issued stock				$ 0.0001		$ 1.93	$ 0.25	$ 0.0001	$ 0.10	$ 0.22	$ 0.39	$ 0.33	$ 0.25	$ 0.23	$ 0.22	$ 0.25	$ 0.10	$ 0.35	$ 0.10	$ 0.08	$ 0.25	$ 0.10	$ 0.07	$ 0.10	$ 0.10	$ 0.08	$ 0.10	$ 0.11	$ 0.10	$ 0.15	$ 0.25	$ 0.18	$ 0.19	$ 0.25	$ 0.20	$ 0.20		$ 0.25	$ 0.25		$ 1.24	$ 1.70	$ 1.93	$ 1.94	$ 2.00	$ 1.95	$ 1.77	$ 1.50	$ 1.80	$ 1.78		$ 0.35	$ 0.35	$ 0.0625	$ 0.0625						$ 0.25	$ 0.25	$ 0.25	$ 0.25	$ 0.25	$ 0.25	$ 0.25	$ 0.25	$ 0.25	$ 0.001				$ 0.12
Shares for forward split							473,000																																																						4,000		4,000	32,000	2,000	20,000	4,000	4,000	4,000	44,900,000	100,000
Common stock par value due to forward split							$ 0.0625																																																					$ 0.0625	$ 0.0625	$ 0.0625	$ 0.0625	$ 0.0625	$ 0.0625	$ 0.0625	$ 0.0625	$ 0.0625	$ 0.0625	$ 0.00025

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Property and Equipment (Tables)

6 Months Ended

Jun. 30, 2012

Property, Plant and Equipment [Abstract]

Summary of property and equipment

	June 30, 2012			December 31, 2011
Website Development	$	187,723		$	127,722
Furniture and Equipment		103,906			103,906
Leasehold Improvements		6,573			6,573
Software		29,963			18,888
Office Equipment		35,647			9,323
Domain Name		1,500			1,500
Sign		628			628
Less accumulated depreciation and amortization		(144,894	)		(122,540	)
	$	221,046		$	146,000