Commitments and Contingencies

12 Months Ended

Dec. 31, 2011

Commitments And Contingencies

Commitments and Contingencies

11.      Commitments and Contingencies

Lease Agreement

The Company’s headquarters is located in Haifa, Israel.  The Company is not charged any rent to use this facility since the amount is immaterial.

During 2011 and 2010, the Company had also paid rent for space in California and New York.  The Company leased two virtual offices in Las Vegas, Nevada, and in Dallas, Texas, paying about $250 per month for each virtual office.

The Company had no future minimum payments on lease obligations as of December 31, 2011.

Rent expense for the years ended December 31, 2011 and 2010 was $42,333 and $73,525, respectively.

Legal Proceedings

From time to time, the Company may be involved in various litigation matters, which arise in the ordinary course of business.  There is currently no litigation that management believes will have a material impact on the financial position of the Company.

On or about June 13, 2011 the Company initiated a complaint against an individual and website for defamation, intentional interference with prospective economic advantage, negligent and violations of business and professions codes.  The Complaint was filled with the Superior Court of the State of California - County of San Diego.  On August 22, 2011, the defendants filed a notice of motion to strike the complaint under the anti-slapp statute.  On September 14, 2011, a request for dismissal, without prejudice was submitted to the court by the Company.

On January 20, 2012 the defendants’ motion was heard by the court and the judge ruled in favor of the defendant and awarded attorney fees and court costs in the amount of $21,462, which was recorded in accounts payable and accrued expenses.  The Company has retained an attorney and has filed a motion to vacate the judgment.