v2.4.0.8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)
 9 Months Ended
Sep. 30, 2013
Accounting Policies [Abstract]  
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block]
Potentially dilutive securities excluded from the computation of basic and diluted net income (loss) per share are as follows:
 
 
 
September 30,
2013
 
September 30,
2012
 
Warrants to purchase common stock
 
 
9,979,900
 
 
2,320,000
 
Options to purchase common stock
 
 
787,500
 
 
-
 
Shares issuable upon conversion of convertible notes and accrued interest
 
 
516,344
 
 
-
 
Series A Convertible Preferred Stock
 
 
2,411,536
 
 
2,200,000
 
Series B Convertible Preferred Stock
 
 
403,837
 
 
-
 
 
 
 
 
 
 
 
 
Totals
 
 
14,099,117
 
 
4,520,000
 
Fair Value, Liabilities Measured on Recurring Basis [Table Text Block]
Financial liabilities as of September 30, 2013 and December 31, 2012 measured at fair value on a recurring basis are summarized below:
 
 
 
September 30,
2013
 
Quoted Prices
in Active
Markets for
Identical Assets
(Level 1)
 
Significant
Other
Observable
Inputs
(Level 2)
 
Significant
Unobservable
Inputs
(Level 3)
 
Derivative liabilities
 
$
1,138,854
 
$
—
 
$
—
 
$
1,138,854
 
 
 
 
December 31,
2012
 
Quoted Prices
in Active
Markets for
Identical Assets
(Level 1)
 
Significant
Other
Observable
Inputs
(Level 2)
 
Significant
Unobservable
Inputs
(Level 3)
 
Derivative liabilities
 
$
730,174
 
$
—
 
$
—
 
$
730,174
 
Schedule of Fair Value Assumptions [Table Text Block]
The fair value of the warrants and the conversion option was calculated using a compound option model that includes characteristics of both a binomial lattice and the Black-Scholes formula with the following weighted average assumptions during the nine months ended September 30, 2013:
 
Dividend Yield
 
 
0.00
%
Volatility
 
 
125.00
%
Risk-free Interest Rate
 
 
0.73-1.21
%
Expected Lives
 
 
1.5 – 4.75 years
 
Schedule of Derivative Instruments [Table Text Block]
The following table sets forth a summary of the changes in the fair value of the Company’s Level 3 financial liabilities that are measured at fair value on a recurring basis for the nine months ended September 30, 2013:
 
 
 
2013
 
Balance - Beginning of period
 
$
730,174
 
Derivative instruments issued
 
 
438,375
 
Change in fair value of derivative liabilities
 
 
(29,695)
 
 
 
 
 
 
Balance - End of period
 
$
1,138,854