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&lt;div style="text-indent: 0pt; display: block; margin-left: 0pt; margin-right: 0pt; text-align: justify"&gt;&lt;font style="display: inline; font: 10pt Times New Roman"&gt;Our accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles, or GAAP, for complete financial statements.&amp;#160;&amp;#160;In our opinion, such financial statements include all adjustments (consisting solely of normal recurring adjustments) necessary for the fair statement of the financial information included herein in accordance with GAAP and the rules and regulations of the Securities and Exchange Commission, or SEC.&amp;#160;&amp;#160;The balance sheet at December 31, 2012 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by GAAP for complete financial statements.&amp;#160;&amp;#160;The preparation of financial statements in conformity with GAAP requires us 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 the reported amounts of revenue and expenses during the period.&amp;#160;&amp;#160;Actual results could differ from those estimates. Results of operations for interim periods are not necessarily indicative of results for the full year. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes included in our Annual Report on Form 10-K filed with the SEC for the year ended December 31, 2012.&lt;/font&gt;&lt;/div&gt;&lt;/div&gt;</NonNumbericText><FootnoteIndexer /><CurrencyCode /><CurrencySymbol /><IsIndependantCurrency>false</IsIndependantCurrency><ShowCurrencySymbol>false</ShowCurrencySymbol><DisplayDateInUSFormat>false</DisplayDateInUSFormat></Cell></Cells><ElementDataType>nonnum:textBlockItemType</ElementDataType><SimpleDataType>na</SimpleDataType><ElementDefenition>Disclosure of accounting policy for basis of accounting, or basis of presentation, used to prepare the financial statements (for example, US Generally Accepted Accounting Principles, Other Comprehensive Basis of Accounting, IFRS).</ElementDefenition><ElementReferences>No definition available.</ElementReferences><IsTotalLabel>false</IsTotalLabel><UnitID>0</UnitID><Label>Interim Financial Statements</Label></Row><Row FlagID="0"><Id>3</Id><IsAbstractGroupTitle>false</IsAbstractGroupTitle><LabelSeparator>

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&lt;div style="text-indent: 0pt; display: block"&gt;&lt;/div&gt;&lt;/div&gt;

&lt;div style="text-indent: 0pt; display: block; margin-left: 0pt; margin-right: 0pt; text-align: justify"&gt;&lt;/div&gt;

&lt;div style="text-indent: 0pt; display: block"&gt;&lt;/div&gt;

&lt;div style="text-indent: 0pt; display: block"&gt;&lt;br /&gt;
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&lt;div style="text-indent: 0pt; display: block; margin-left: 0pt; margin-right: 0pt; text-align: justify"&gt;&lt;font style="display: inline; font: 10pt Times New Roman"&gt;We categorize our assets and liabilities that are valued at fair value on a recurring basis into a three-level fair value hierarchy as defined by Accounting Standards Codification, or ASC 820 &lt;font style="font-style: italic; display: inline"&gt;Fair Value Measurements and Disclosures. &lt;/font&gt;The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets and liabilities (Level 1) and lowest priority to unobservable inputs (Level 3).&amp;#160;&amp;#160;Assets and liabilities recorded in the consolidated balance sheet at fair value are categorized based on a hierarchy of inputs, as follows:&lt;/font&gt;&lt;/div&gt;

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&lt;div style="text-indent: 0pt; display: block; margin-left: 0pt; margin-right: 0pt; text-align: left"&gt;&lt;font style="display: inline; font: 10pt times new roman"&gt;unadjusted quoted prices in active markets for identical assets or liabilities;&lt;/font&gt;&lt;/div&gt;
&lt;/td&gt;
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&lt;td style="text-align: left; vertical-align: top; width: 10%"&gt;&lt;font style="display: inline; font: 10pt times new roman"&gt;&amp;#160; &lt;/font&gt;&lt;/td&gt;
&lt;td style="vertical-align: top; width: 3%"&gt;&lt;font style="display: inline; font: 10pt times new roman"&gt;&amp;#160; &lt;/font&gt;&lt;/td&gt;
&lt;td style="vertical-align: top; width: 82%"&gt;&lt;font style="display: inline; font: 10pt times new roman"&gt;&amp;#160; &lt;/font&gt;&lt;/td&gt;
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&lt;div style="text-align: center; text-indent: 0pt; display: block; margin-left: 0pt; margin-right: 0pt"&gt;&lt;font style="display: inline; font: bold 10pt times new roman"&gt;Level 2&lt;/font&gt;&lt;/div&gt;
&lt;/td&gt;
&lt;td style="vertical-align: top; width: 3%"&gt;&lt;font style="display: inline; font: 10pt times new roman"&gt;&amp;#160; &lt;/font&gt;&lt;/td&gt;
&lt;td style="vertical-align: top; width: 82%"&gt;
&lt;div style="text-indent: 0pt; display: block; margin-left: 0pt; margin-right: 0pt; text-align: justify"&gt;&lt;font style="display: inline; font: 10pt times new roman"&gt;quoted prices for similar assets or liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument; and&lt;/font&gt;&lt;/div&gt;
&lt;/td&gt;
&lt;/tr&gt;&lt;tr&gt;
&lt;td style="vertical-align: top; width: 5%"&gt;&lt;font style="display: inline; font: 10pt times new roman"&gt;&amp;#160; &lt;/font&gt;&lt;/td&gt;
&lt;td style="vertical-align: top; width: 10%"&gt;&lt;font style="display: inline; font: 10pt times new roman"&gt;&amp;#160; &lt;/font&gt;&lt;/td&gt;
&lt;td style="vertical-align: top; width: 3%"&gt;&lt;font style="display: inline; font: 10pt times new roman"&gt;&amp;#160; &lt;/font&gt;&lt;/td&gt;
&lt;td style="vertical-align: top; width: 82%"&gt;&lt;font style="display: inline; font: 10pt times new roman"&gt;&amp;#160; &lt;/font&gt;&lt;/td&gt;
&lt;/tr&gt;&lt;tr&gt;
&lt;td style="vertical-align: top; width: 5%"&gt;&lt;font style="display: inline; font: 10pt times new roman"&gt;&amp;#160; &lt;/font&gt;&lt;/td&gt;
&lt;td style="vertical-align: top; width: 10%; text-align: center"&gt;
&lt;div style="text-align: center; text-indent: 0pt; display: block; margin-left: 0pt; margin-right: 0pt"&gt;&lt;font style="display: inline; font: bold 10pt times new roman"&gt;Level 3&lt;/font&gt;&lt;/div&gt;
&lt;/td&gt;
&lt;td style="vertical-align: top; width: 3%"&gt;&lt;font style="display: inline; font: 10pt times new roman"&gt;&amp;#160; &lt;/font&gt;&lt;/td&gt;
&lt;td style="text-align: left; vertical-align: top; width: 82%"&gt;
&lt;div style="text-indent: 0pt; display: block; margin-left: 0pt; margin-right: 0pt; text-align: left"&gt;&lt;font style="display: inline; font: 10pt times new roman"&gt;unobservable inputs for the asset or liability.&lt;/font&gt;&lt;/div&gt;
&lt;/td&gt;
&lt;/tr&gt;&lt;/table&gt;
&lt;/div&gt;

&lt;div style="text-indent: 0pt; display: block"&gt;&lt;br /&gt;
&lt;/div&gt;

&lt;div style="text-indent: 0pt; display: block; margin-left: 0pt; margin-right: 0pt; text-align: justify"&gt;&lt;font style="display: inline; font: 10pt Times New Roman"&gt;At June 30, 2013 and December 31, 2012, we had no assets or liabilities that were valued at fair value on a recurring basis.&lt;/font&gt;&lt;/div&gt;</NonNumbericText><FootnoteIndexer /><CurrencyCode /><CurrencySymbol /><IsIndependantCurrency>false</IsIndependantCurrency><ShowCurrencySymbol>false</ShowCurrencySymbol><DisplayDateInUSFormat>false</DisplayDateInUSFormat></Cell></Cells><ElementDataType>nonnum:textBlockItemType</ElementDataType><SimpleDataType>na</SimpleDataType><ElementDefenition>Disclosure of accounting policy for determining the fair value of financial instruments.</ElementDefenition><ElementReferences>Reference 1: http://www.xbrl.org/2003/role/presentationRef

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&lt;div style="text-indent: 0pt; display: block; margin-left: 0pt; margin-right: 0pt; text-align: justify"&gt;&lt;font style="font: 10pt Times New Roman"&gt;We
calculate earnings per share, or EPS, in accordance with ASC 260, &lt;i&gt;Earnings Per Share&lt;/i&gt;, which requires the computation
and disclosure of two EPS amounts, basic and diluted. We compute basic EPS based on the weighted average number of shares of common
stock outstanding during the period. We compute diluted EPS based on the weighted average number of shares of common stock outstanding
plus all potentially dilutive common shares outstanding during the period. Such potentially dilutive common shares consist of
stock options and warrants. Potentially dilutive common shares totaling 21,773,002 and 18,884,154 at June 30, 2013 and 2012, respectively,
have been excluded from the diluted earnings per share calculation as they are anti-dilutive due to the net loss reported by us.&lt;/font&gt;&lt;/div&gt;
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&lt;div style="text-indent: 0pt; display: block; margin-left: 0pt; margin-right: 0pt; text-align: justify"&gt;&lt;font style="display: inline; font: 10pt Times New Roman"&gt;On July 18, 2013, the Financial Accounting Standards Board (&amp;#8220;FASB&amp;#8221;) issued Accounting Standards Update (&amp;#8220;ASU&amp;#8221;) No. 2013-11, &lt;font style="font-style: italic; display: inline"&gt;Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit when a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (a consensus of the FASB Emerging Issues Task Force)&lt;/font&gt;. The amendments in this ASU provide guidance on the financial statements presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. An unrecognized tax benefit should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward with certain exceptions, in which case such an unrecognized tax benefit should be presented in the financial statements as a liability. The amendments in this ASU do not require new recurring disclosures. The amendments in this ASU are effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The amendments in ASU No. 2013-11 are not expected to have an impact on our condensed consolidated financial statements.&lt;/font&gt;&lt;/div&gt;&lt;/div&gt;</NonNumbericText><FootnoteIndexer /><CurrencyCode /><CurrencySymbol /><IsIndependantCurrency>false</IsIndependantCurrency><ShowCurrencySymbol>false</ShowCurrencySymbol><DisplayDateInUSFormat>false</DisplayDateInUSFormat></Cell></Cells><ElementDataType>nonnum:textBlockItemType</ElementDataType><SimpleDataType>na</SimpleDataType><ElementDefenition>Disclosure of accounting policy pertaining to new accounting pronouncements that may impact the entity's financial reporting. Includes, but is not limited to, quantification of the expected or actual impact.</ElementDefenition><ElementReferences>No definition available.</ElementReferences><IsTotalLabel>false</IsTotalLabel><UnitID>0</UnitID><Label>Recently Issued and Newly Adopted Accounting Pronouncements</Label></Row><Row FlagID="0"><Id>7</Id><IsAbstractGroupTitle>false</IsAbstractGroupTitle><LabelSeparator>

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&lt;div style="text-indent: 0pt; display: block; margin-left: 0pt; margin-right: 0pt; text-align: left"&gt;&lt;font style="display: inline; font: 10pt Times New Roman"&gt;Certain 2012 amounts have been reclassified to conform to current year presentation.&lt;/font&gt;&lt;/div&gt;
&lt;/div&gt;</NonNumbericText><FootnoteIndexer /><CurrencyCode /><CurrencySymbol /><IsIndependantCurrency>false</IsIndependantCurrency><ShowCurrencySymbol>false</ShowCurrencySymbol><DisplayDateInUSFormat>false</DisplayDateInUSFormat></Cell></Cells><ElementDataType>nonnum:textBlockItemType</ElementDataType><SimpleDataType>na</SimpleDataType><ElementDefenition>Disclosure of accounting policy for reclassifications that affects the comparability of the financial statements.</ElementDefenition><ElementReferences>Reference 1: http://www.xbrl.org/2003/role/presentationRef

 -Publisher FASB

 -Name Accounting Standards Codification

 -Topic 205

 -SubTopic 10

 -Section 50

 -Paragraph 1

 -URI http://asc.fasb.org/extlink&amp;oid=6359566&amp;loc=d3e326-107755



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