COMMITMENTS AND CONTINGENCIES

9 Months Ended

Sep. 30, 2013

COMMITMENTS AND CONTINGENCIES [Abstract]

COMMITMENTS AND CONTINGENCIES

NOTE 9 -COMMITMENTS AND CONTINGENCIES

Operating Leases

The Company subleases its facility under a month-to-month operating lease from a tenant that is affiliated with a principal shareholder. The sublease expires in January 2017. Rent expense amounted to $55,160 and $0 during the nine month periods ended September 30, 2013 and 2012, respectively.

Executive Compensation

Employment agreement executed with a Company officer call for a base salary of $210,000 per year. The officer is also entitled to an annual bonus which is based on performance and attaining certain operational milestones.

On June 30, 2013, the Company officer agreed to forgive his deferred and accrued salary amounted to $128,456 that was entitled to him under the employment agreement for the period from January to June 2013. Additionally one officer forgave the portion of his payment of salary and bonuses for the period July 1, 2013 through September 30, 2013. (see Note 5).

Legal Matters

From time to time, claims are made against the Company in the ordinary course of business, which could result in litigation. Claims and associated litigation are subject to inherent uncertainties and unfavorable outcomes could occur, such as monetary damages, fines, penalties or injunctions prohibiting the Company from selling one or more products or engaging in other activities. The occurrence of an unfavorable outcome in any specific period could have a material adverse effect on the Company's results of operations for that period or future periods. The Company is not presently a party to any pending or threatened legal proceedings.