Subsequent Events

3 Months Ended

Mar. 31, 2014

Subsequent Events

Convertible Debentures and Warrants

From April 2014 through June 27, 2014, the Company sold Unsecured Convertible Debentures (the “Debentures”) to accredited investors for aggregate consideration of $995,000. The Debentures mature in twelve months, carry a fixed conversion price of $.045, an annual interest rate of 10% and are convertible into 22,695,906 shares of common stock at maturity. The Company received net cash proceeds of approximately $943,000 after payment of fees and expenses of $52,000. In addition, the Company issued the holders of the Debentures detachable five-year warrants to purchase 11,347,953 additional shares of common stock and will issue to a placement agent of a portion of the offering warrants to purchase 383,333 shares of common stock all at an exercise price of $0.090 per share and will issue to the same agent 801,111 shares of common stock in lieu of a cash payment.

Subsequent events have been evaluated through the date financial statements are filed with the Securities and Exchange Commission.