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<p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; margin-left: 0pt; text-indent: 0pt; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">1.
ORGANIZATION AND LINE OF BUSINESS</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Organization</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Warp
9, Inc. (the “Company”) is a Nevada corporation formerly known as Roaming Messenger, Inc., formerly known as Latinocare
Management Corporation (“LMC”). On August 24, 2006, the Company’s board of directors and a majority of shareholders
voted to change the name of the Company from Roaming Messenger, Inc. to Warp 9, Inc. to reflect a new strategic plan of focusing
primarily on the business of the Company’s wholly owned subsidiary, Warp 9, Inc., a Delaware corporation. The Company, based
in Goleta, California, began operations on October 1, 1999. The Company is a provider of fully hosted web based e-commerce software
products.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Line
of Business</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">We
are a provider of mobile and e-commerce solutions for midsize online sellers, in the retail and business to business (“B2B”)industries.
Our solutions and services are designed to help multi-channel retailers maximize digital commerce revenues by applying our technologies
and solutions for mobile e-commerce, desktop e-commerce, e-mail marketing, social media and other digital avenues. Offered as
an outsourced and fully managed Software-as-a-Service (“SaaS”) model, our solutions allow customers to focus on their
core business, rather than technical implementations and software and hardware architecture, design, and maintenance. We believe
our products and services allow our clients to lower costs and focus on promoting and marketing their brand, product line and
website while leveraging the investments we have made in technology and infrastructure to operate a dynamic digital presence.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; background-color: white; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Going
Concern</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white; text-indent: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">The
accompanying financial statements have been prepared on a going concern basis of accounting, which contemplates continuity of
operations, realization of assets and liabilities and commitments in the normal course of business.  The accompanying
financial statements do not reflect any adjustments that might result if the Company is unable to continue as a going concern.  The
Company does not generate significant revenue, and has negative cash flows from operations, which raise substantial doubt about
the Company’s ability to continue as a going concern.  The ability of the Company to continue as a going concern
and appropriateness of using the going concern basis is dependent upon, among other things, an additional cash infusion. The Company
has obtained funds from its shareholders since its inception through June 30, 2014. It is Management’s plan to generate
additional working capital from increasing sales from its new Warp 9 Total Commerce Platform (“TCP”) and Warp 9 Mobile
service offerings, and then continue to pursue its business plan and purposes.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; margin-left: 0pt; text-indent: 0pt; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">This
summary of significant accounting policies of Warp 9, Inc. is presented to assist in understanding the Company’s financial
statements. The financial statements and notes are representations of the Company’s management, which is responsible for
their integrity and objectivity. These accounting policies conform to accounting principles generally accepted in the United States
of America and have been consistently applied in the preparation of the financial statements.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">The
Consolidated Financial Statements include the Company and its majority-owned subsidiary (“Warp 9, Inc., a Delaware corporation”).
All significant inter-company transactions are eliminated in consolidation.</font></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Accounts
receivable</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif">The
Company extends credit to its customers, who are located nationwide. Accounts receivable are customer obligations due under normal
trade terms. The Company performs continuing credit evaluations of its customers’ financial condition. Management reviews
accounts receivable on a regular basis, based on contracted terms and how recently payments have been received to determine if
any such amounts will potentially be uncollected. The Company includes any balances that are determined to be uncollectible in
its allowance for doubtful accounts. After all attempts to collect a receivable have failed, the receivable is written off. The
balance of the allowance account at June 30, 2014 and 2013 are $24,907 and $24,907 respectively.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0pt; text-align: justify"><font style="font: normal 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: normal 10pt Times New Roman, Times, Serif"></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif"><u>Use
of Estimates</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">The
preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates
and assumptions that affect the amounts reported in the accompanying financial statements. Significant estimates made in preparing
these financial statements include the allowance for doubtful accounts, the estimate of useful lives of property and equipment,
the deferred tax valuation allowance, and the fair value of stock options and warrants. Actual results could differ from those
estimates.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Cash
and Cash Equivalents </u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">The
Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Revenue
recognition</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">The
Company recognizes income when the service is provided or when product is delivered. We present revenue, net of customer incentives.
Most of the income is generated from professional services and site development fees.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">We
provide online marketing services that we purchase from third parties. The gross revenue presented in our statement of operations
is in accordance with ASC 605-45.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">We
also offer professional services such as development services.  The fees for development services with multiple deliverables
constitute a separate unit of accounting in accordance with ASC 605-25, which are recognized as the work is performed.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Upfront
fees for development services or other customer services are deferred until certain implementation or contractual milestones have
been achieved. The deferred revenue as of June 30, 2014 and 2013 was $3,300 and zero, respectively.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">For
the fiscal year ended, June 30, 2014, monthly recurring fees for mobile and desktop e-commerce development account for 19% of
the Company’s total revenues, professional services account for 79% and the remaining 2% of total revenues are from resale
of third party products and services.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">For
the fiscal year ended, June 30, 2013, monthly recurring fees for mobile and desktop e-commerce development account for 24% of
the Company’s total revenues, professional services account for 72% and the remaining 4% of total revenues are from resale
of third party products and services.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Return
policy</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">On
all service offerings such as web based e-commerce products there are no returns. Monthly fees are assessed and revenue is recognized
at the end of every month, after service has been provided. Some higher paying customers may have service level agreements where
we guarantee system uptime such as 99.9% of the time per month. If we fall below the agreed upon level of uptime, we shall credit
one day of service fee for each hour our system is down up to a maximum of one monthly fee. This guarantee only covers downtime
as a result of failure in the Company’s cloud hosting architecture or gross negligence. Historically, the Company has not
had to issue any credits for such returns.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Cost
of Revenue</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Cost
of revenue includes the direct costs of operating the Company’s cloud hosting architecture, contractors involved in the
production process and certain third party internet marketing charges.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Research
and Development</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Research
and development costs are expensed as incurred. Total research and development costs were zero and $13,307 for the years ended
June 30, 2014 and 2013, respectively.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Advertising
Costs </u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">The
Company expenses the cost of advertising and promotional materials when incurred. Total advertising costs were $22,137 and $498
for the years ended June 30, 2014 and 2013, respectively.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Fair
value of financial instruments</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">The
Company’s financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and accrued
liabilities are carried at cost, which approximates their fair value, due to the relatively short maturity of these instruments.
As of June 30, 2014 and 2013, the Company’s capital lease obligations and notes payable have stated borrowing rates that
are consistent with those currently available to the Company and, accordingly, the Company believes the carrying value of these
debt instruments approximates their fair value.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Fair
value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date. ASC Topic 820 established a three-tier fair value hierarchy which prioritizes
the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets
for identical assets or liabilities (level 1measurements) and the lowest priority to unobservable inputs (level 3 measurements).
These tiers include:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify; background-color: white"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%">
<tr style="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
<td style="width: 10%; padding-left: 0; text-align: justify; font: 10pt Times New Roman, Times, Serif">•</td>
<td style="width: 90%; padding-left: 0; text-align: justify; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Level
1, defined as observable inputs such as quoted prices for identical instruments in active markets;</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 45pt; text-align: justify; background-color: white"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%">
<tr style="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
<td style="width: 10%; font: 10pt Times New Roman, Times, Serif">•<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></p></td>
<td style="width: 90%; padding-left: 0; text-align: justify; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Level
2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as
quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that
are not active; and</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 45pt; text-align: justify; background-color: white"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%">
<tr style="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
<td style="width: 10%; font: 10pt Times New Roman, Times, Serif">•<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></p></td>
<td style="width: 90%; padding-left: 0; text-align: justify; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Level
3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own
assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value
drivers are unobservable.</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; background-color: white"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">We
measure certain financial instruments at fair value on a recurring basis. Assets and liabilities measured at fair value on a recurring
basis are as follows at June 30, 2014:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in"></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 9pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td style="text-align: left; padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">For
the year ended June 30, 2014</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Total</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(Level
1)</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(Level
2)</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(Level
3)</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="width: 40%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Assets</font></td><td style="width: 3%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 3%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 3%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 3%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Total
assets measured at fair value</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Liabilities</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Derivative
liability</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">2,169,051</font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">2,169,051</font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Convertible
notes, net of discount</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">150,536</font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">150,536</font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Total
liabilities measured at fair value</font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2,319,587</font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2,319,587</font></td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr>
</table>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> Assets
and liabilities measured at fair value on a recurring basis are as follows at June 30, 2013:</font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in"> </p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in"></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td style="text-align: center"> </td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">Total</td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">(Level 1)</td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">(Level 2)</td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">(Level 3)</td></tr>
<tr style="vertical-align: bottom">
<td> </td><td> </td>
<td colspan="3" style="text-align: center"> </td><td> </td>
<td colspan="3" style="text-align: center"> </td><td> </td>
<td colspan="3" style="text-align: center"> </td><td> </td>
<td colspan="3" style="text-align: center"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="width: 40%">Assets</td><td style="width: 3%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 10%; text-align: right">—  </td><td style="width: 1%; text-align: left"> </td><td style="width: 3%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 10%; text-align: right">—  </td><td style="width: 1%; text-align: left"> </td><td style="width: 3%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 10%; text-align: right">—  </td><td style="width: 1%; text-align: left"> </td><td style="width: 3%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 10%; text-align: right">—  </td><td style="width: 1%; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"> </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"> </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"> </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"> </td><td style="padding-bottom: 1pt; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left; padding-bottom: 1pt">Total assets measured at fair value</td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td><td style="border-bottom: Black 1pt solid; text-align: right">—  </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td><td style="border-bottom: Black 1pt solid; text-align: right">—  </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td><td style="border-bottom: Black 1pt solid; text-align: right">—  </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td><td style="border-bottom: Black 1pt solid; text-align: right">—  </td><td style="padding-bottom: 1pt; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td>Liabilities</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">Derivative liability</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; padding-bottom: 1pt">Convertible notes, net of discount</td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">126,984</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">—  </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">—  </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">126,984</td><td style="padding-bottom: 1pt; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left; padding-bottom: 2.5pt">Total liabilities measured at fair value</td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">126,984</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">—  </td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">—  </td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">126,984</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr>
</table>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in"></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in"> <font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Property
and Equipment</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Property
and equipment are stated at cost, and are depreciated or amortized using the straight-line method over the following estimated
useful lives:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="width: 45%; text-align: left">Furniture, fixtures & equipment</td><td style="width: 10%"> </td>
<td style="width: 45%; text-align: right">7 Years</td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">Computer equipment</td><td> </td>
<td style="text-align: right">5 Years</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">Commerce server</td><td> </td>
<td style="text-align: right">5 Years</td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">Computer software</td><td> </td>
<td style="text-align: right">3 - 5 Years</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">Leasehold improvements</td><td> </td>
<td style="text-align: right">Length of the lease</td></tr>
</table>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Depreciation
expenses were$42,747 and $23,495 for the years ended June 30, 2014 and 2013, respectively.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif"><u>Concentrations
of Business and Credit Risk</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">The
Company operates in a single industry segment. The Company markets its services to companies and individuals in many industries
and geographic locations. The Company’s operations are subject to rapid technological advancement and intense competition
in the telecommunications industry. Accounts receivable represent financial instruments with potential credit risk. The Company
typically offers its customers credit terms. The Company makes periodic evaluations of the credit worthiness of its enterprise
customers and other than obtaining deposits pursuant to its policies, it generally does not require collateral. In the event of
nonpayment, the Company has the ability to terminate services.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Stock-Based
Compensation</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">The
Company addressed the accounting for share-based payment transactions in which an enterprise receives employee services in exchange
for either equity instruments of the enterprise or liabilities that are based on the fair value of the enterprise’s equity
instruments or that may be settled by the issuance of such equity instruments. The transactions are accounted for using a fair-value-based
method and recognized as expenses in our statement of income.There was no material impact on the Company’s financial statement
of operations.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Stock-based
compensation expense recognized during the period is based on the value of the portion of stock-based payment awards that is
ultimately expected to vest. Stock-based compensation expense recognized in the consolidated statement of operations during
the year ended June 30, 2014, included compensation expense for the stock-based payment awards granted prior to, but not yet
vested, as of June 30, 2014 based on the grant date fair value estimated. Stock-based compensation expense recognized in the
statement of operationsfor the year ended June 30, 2014 is based on awards ultimately expected to vest, or has been reduced
for estimated forfeitures. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if
actual forfeitures differ from those estimates. The stock-based compensation expense recognized in the consolidated
statements of operations during the year ended June 30, 2014 and 2013was $22,986 and $21,010, respectively.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Earnings
Per Share</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Earnings
per Share require the Company to calculate earnings per share based on basic and diluted earnings per share, as defined. Basic
earnings per share exclude dilution and are computed by dividing net income by theweighted average number of shares outstanding
for the period. Diluted earnings per share reflect the potential dilution that could occur if stock options and warrants to issue
common stock were exercised or converted into common stock. For the year ended June 30, 2014, since the Company reported a net
loss, the additional diluted shares would have had an anti-dilutive effect. Therefore, all additional shares that would have been
included in the diluted earnings per share calculation were excluded, and the basic and diluted earnings per share numbers are
identical.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Income
Taxes</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif">The
Company uses the liability method of accounting for income taxes. Deferred tax assets and liabilities are recognized for the future
tax consequences attributable to financial statements carrying amounts of existing assets and liabilities and their respective
tax bases and operating loss and tax credit carry-forwards. The measurement of deferred tax assets and liabilities is based on
provisions of applicable tax law. The measurement of deferred tax assets is reduced, if necessary, by a valuation allowance based
on the amount of tax benefits that, based on available evidence, is not expected to be realized.</font></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif"><u>Recently
Issued Accounting Pronouncements</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Management
reviewed accounting pronouncements issued during the twelve months ended June 30, 2014, and no pronouncements were adopted during
the period.</font></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif; background-color: white">The
Company adopted ASC 815 "Accounting for Derivative Instruments and Hedging Activities". This pronouncement addresses
the accounting for derivative instruments including certain derivative instruments embedded in other contracts, and hedging activities.
Derivative instruments that meet the definition of assets and liabilities should be reported in the financial statements at fair
value, and any gain or loss should be recognized in current earnings.  The adoption of this pronouncement had a material
effect on the financial statements of the Company.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">3.	NOTES
PAYABLE</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.25in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">At
June 30, 2007, the Company reclassified an accounts payable account to a vendor in the amount of $154,429 to a note payable. The
monthly payment on the note is $3,342 per month and bears annual interest at the rate of 10% per annum. At June 30, 2014 and 2013,
the outstanding principal and accrued interest balance was $49,799 and $45,815, respectively. The total outstanding and accrued
interest balance of $11,932 is currently due.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">On
March 25, 2013, the Company entered into a convertible promissory note (“the March 2013 Note”) in the amount of $100,000,
at which time an initial advance of $50,000 was received to cover operational expenses. The lender advanced an additional $20,000
on April 16, 2013, an additional $15,000 on May 1, 2013 and an additional $15,000 on May 16, 2013, for a total draw of $100,000.
The terms of the March 2013 Note allow the lender to convert all or part of the outstanding balance plus accrued interest, at
any time after the effective date, at a conversion price of the lower of (a) $0.015 per share, or (b) 50% of the lowest trade
price of Common Stock recorded on any trade day after the effective date of the agreement. The March 2013 Note bears interest
at a rate of 10% per year and matureson September 25, 2015. On May 23, 2014, the lender converted $17,000 of the $100,000 outstanding
balance and accrued interest of $1,975 into 4,743,699 shares of common stock. The balance of the March 2013 Note, as of June 30,
2014 is $83,000.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">On
May 16, 2013, the Company signed a convertible promissory note (“the May 2013 Note”) in the amount of $100,000,
at which time an initial advance of $10,000 was received to cover operational expenses. The lender advanced an additional
$20,000 onJune 3, 2013, an additional $25,000 on July 2, 2013, an additional $10,000 on September 3, 2013 and an additional
$35,000 on February 18, 2014, for a total draw of $100,000. The terms of the May 2013 Note allow the lender to convert all or
part of the outstanding balance plus accrued interest, at any time after the effective date, at a conversion price of the
lower of (a) $0.015 per share, or (b) 50% of the lowest trade price of Common Stock recorded on any trade day after the
effective date of the agreement. The Company recognized a discount on the May 2013 Note in the amount of $20,000, due to the
beneficial conversion feature. This discount isbeing recognized over twelve months, beginning on the date of each tranche
payment. For the year ended June 30, 2014, the Company included $14,605 in interest expense related to the discount. <font style="background-color: white">The
Company recorded debt discount of $56,000 related to the conversion feature of the May 2013 Note, along with derivative
liabilities. </font>The May 2013 Note bears interest at a rate of 10% per year and matureson November 16, 2014.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">On
March 4, 2014, the Company entered into a convertible promissory note (“the March 2014 Note”) in the amount of $250,000,
at which time an initial advance of $25,000 was received to cover operational expenses. The lender advanced an additional $20,000
onMarch 17, 2014 and an additional $30,000 on April 2, 2014, for a total draw of $75,000. The terms of the March 2014Note allow
the lender to convert all or part of the outstanding balance plus accrued interest, at any time after the effective date, at a
conversion price of the lower of (a) $0.012 per share, or (b) 50% of the lowest trade price of Common Stock recorded on any trade
day after the effective date of the agreement.<font style="background-color: white">The Company recorded debt discount of $75,000
related to the beneficial conversion feature of the March 2014 Note, along with derivative liabilities</font>. This discount is
recognized over 18 months, beginning on the date of each tranche payment. For the year ended June 30, 2014, the Company included
$4,461 in interest expense related to the discount. The March 2014Note bears interest at a rate of 10% per year and matures18
months from the effective date of each advance.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">On
April 16, 2014, the Company entered into a convertible promissory note (“the April 2014 Note”) in the amount of $300,000,
at which time an initial advance of $40,000 was received to cover operational expenses. The lender advanced an additional $55,000
onApril 30, 2014, an additional $40,000 on May 16, 2014, an additional $40,000 on June 2, 2014 and an additional $35,000 on June
30, 2014, for a total draw of $210,000. The terms of the April 2014 Note allow the lender to convert all or part of the outstanding
balance plus accrued interest, at any time after the effective date, at a conversion price of the lower of (a) $0.012 per share,
or (b) 50% of the lowest trade price of Common Stock recorded on any trade day after the effective date of the agreement. <font style="background-color: white">The
Company recorded debt discount of $210,000 related to the conversion feature of the April 2014 Note, along with derivative liabilities</font>.
This discount is recognized over 18 months, beginning on the date of each tranche payment. For the year ended June 30, 2014, the
Company included $1,410 in interest expense related to the discount. The April 2014 Note bears interest at a rate of 10% per year
and matures18 months from the effective date of each advance.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">ASC
Topic 815 provides guidance applicable to convertible debt issued by the Company in instances where the number into which the
debt can be converted is not fixed.  For example, when a convertible debt converts at a discount to market based on
the stock price on the date of conversion, ASC Topic 815 requires that the embedded conversion option of the convertible debt
be bifurcated from the host contract and recorded at their fair value. In accounting for derivatives under accounting standards,
the Company recorded a liability of $2,169,051 representing the estimated present value of the conversion feature considering
the historic volatility of the Company’s stock, and a discount of $339,981representing the imputed interest associated with
the embedded derivative. The discount is amortized over the life of the convertible debt, and the derivative liability is adjusted
periodically according to stock price fluctuations. At the time of conversion, any remaining derivative liability will be charged
to additional paid-in capital.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">For
purpose of determining the fair market value of the derivative liability, the Company used Black Scholes option valuation model.
The significant assumptions used in the Black Scholes valuation of the derivative are as follows:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">  </font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 67.5pt; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><b></b></font></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="width: 56%; text-align: left">Stock price on the valuation dates</td><td style="width: 1%"> </td>
<td style="width: 1%; text-align: left"> </td><td style="width: 12%; text-align: right"> </td><td style="width: 1%; text-align: left"> </td><td style="width: 8%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 19%; text-align: right">0.0261</td><td style="width: 1%; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">Conversion price for the debt</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"></td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left">$</td><td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.004 - 0.012</font></td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">Dividend yield</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">0</td><td style="text-align: left">%</td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">Years to maturity</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">3 months - 18 months</font></td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">Risk free rate</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.07% - 0.29%</font></td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">Expected volatility</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">142.45% - 155.33%</font></td><td style="text-align: left"> </td></tr>
</table>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 67.5pt; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Following
is the five year maturity schedule for our convertible notes payable:</font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 67.5pt; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 67.5pt; text-align: justify"></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td colspan="2" style="border-bottom: Black 1pt solid">Year ended June 30,</td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">Amount Due</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="width: 43%; text-align: left; vertical-align: bottom">2015</td><td style="width: 1%; text-align: left"> </td><td style="width: 10%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 43%; text-align: right">183,000</td><td style="width: 1%; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; vertical-align: bottom">2016</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left">$</td><td style="text-align: right">285,000</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left; vertical-align: bottom">2017</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left">$</td><td style="text-align: right">—  </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; vertical-align: bottom">2018</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left">$</td><td style="text-align: right">—  </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left; vertical-align: bottom">2019</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left">$</td><td style="text-align: right">—  </td><td style="text-align: left"> </td></tr></table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">4. RELATED
PARTIES</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: -0.25in"><font style="font: normal 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif">During
the fiscal year ended June 30, 2012, the Company signed a licensing agreement with PageTransformer, to obtain expertise in the
area of mobile app and mobile web development. This licensing agreement expired on June 30, 2014 and was not renewed. The two
founders of PageTransformer, Andrew VanNoy and Zachary Bartlett, are our current Chief Executive Officer and our current Vice
President of Operations, respectively. Other than the original licensing fee paid to PageTransformer, the Company has not made
any subsequent payments to PageTransformer under the licensing agreement.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0in"><font style="font: 10pt Times New Roman, Times, Serif">5.	INCOME
TAXES</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">The
Company files income tax returns in the U.S. Federal jurisdiction, and the state of California. With few exceptions, the Company
is no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years before
2009.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif">Deferred
income taxes have been provided by temporary differences between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for tax purposes. To the extent allowed by GAAP, we provide valuation allowances against
the deferred tax assets for amounts when the realization is uncertain. Included in the balances at June 30, 2014 and 2013, are
no tax positions for which the ultimate deductibility is highly certain, but for which there is uncertainty about the timing of
such deductibility. Because of the impact of deferred tax accounting, other than interest and penalties, the disallowance of the
shorter deductibility period would not affect the annual effective tax rate but would accelerate the payment of cash to the taxing
authority to an earlier period.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif">The
Company's policy is to recognize interest accrued related to unrecognized tax benefits in interest expense and penalties in operating
expenses. During the periods ended June 30, 2014 and 2013, the Company did not recognize interest and penalties.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">6.	DEFERRED
TAX BENEFIT</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.25in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Deferred
taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating
loss and tax credit carry-forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences
are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced
by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred
tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates
on the date of enactment.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Net
deferred tax assets consist of the following components as of June 30, 2014 and 2013:</font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify; text-indent: 0.5in"> </p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify; text-indent: 0.5in"></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify; text-indent: 0.5in"></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td> </td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">June 30, 2014</td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">June 30, 2013</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">Deferred tax assets:</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="width: 56%; text-align: left">   NOL carryforward</td><td style="width: 8%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 12%; text-align: right">2,560,300</td><td style="width: 1%; text-align: left"> </td><td style="width: 8%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 12%; text-align: right">2,349,100</td><td style="width: 1%; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td>   R&D carryforward</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">113,100</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">300</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">   Capital loss carryforward</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">11,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">12,000</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">   Accrued vacation payable</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">23,500</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">8,600</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">   Allowance for doubtful accounts</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">9,700</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">9,700</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">   Contribution carryforward</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">200</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">200</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">   Related party accruals</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">1,000</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">Deferred tax liabilities:</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td>   Depreciation</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">(2,700</td><td style="text-align: left">)</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">(12,500</td><td style="text-align: left">)</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; padding-bottom: 1pt">Valuation allowance</td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(2,715,100</td><td style="padding-bottom: 1pt; text-align: left">)</td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(2,368,400</td><td style="padding-bottom: 1pt; text-align: left">)</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left; padding-bottom: 2.5pt">Net deferred tax asset</td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">—  </td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">—  </td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr>
</table>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify; text-indent: 0.5in"></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify; text-indent: 0.5in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">The
income tax provision differs from the amount of income tax determined by applying the U.S. federal and state income tax rate of
39% to pretax income from continuing operations for the years ended June 30, 2014 and 2013 due to the following:</font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"> </p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td> </td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">June 30, 2014</td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">June 30, 2013</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="width: 56%; text-align: left">Book income</td><td style="width: 8%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 12%; text-align: right">(941,500</td><td style="width: 1%; text-align: left">)</td><td style="width: 8%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 12%; text-align: right">(130,200</td><td style="width: 1%; text-align: left">)</td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">Nondeductible expenses</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">747,400</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">8,700</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">Accrued vacation payable</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">(15,000</td><td style="text-align: left">)</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">(2,200</td><td style="text-align: left">)</td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">Allowance for bad debt</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">(10,700</td><td style="text-align: left">)</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td>Depreciation</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">10,100</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">(1,400</td><td style="text-align: left">)</td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">Excess loss on disposal over book</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">(15,500</td><td style="text-align: left">)</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">Contributed services</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">4,700</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td>R&D credit</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">100</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">Related party accruals</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">(1,000</td><td style="text-align: left">)</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">1,000</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left; padding-bottom: 1pt">Valuation allowance</td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">215,500</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">130,000</td><td style="padding-bottom: 1pt; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; padding-bottom: 2.5pt">Income tax expense</td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">—  </td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">—  </td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr>
</table>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">At
June 30, 2014, the Company had net operating loss carryforwards of approximately $6,565,000, that may be offset against future
taxable income from the year 2013 through 2032. No tax benefit has been reported in the June 30, 2014 consolidated financial statements
since the potential tax benefit is offset by a valuation allowance of the same amount.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Due
to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carryforwards for Federal income tax reporting
purposes are subject to annual limitations. Should a change in ownership occur, net operating loss carryforwards may be limited
as to use in future years.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0in"><font style="font: 10pt Times New Roman, Times, Serif">7.	CAPITAL
STOCK</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif; color: black">On
May 23, 2014, the lender converted $17,000 out of the $100,000 balance along with accrued interest of $1,975 into 4,743,699 shares
of common stock.</font><font style="font: 10pt Times New Roman, Times, Serif">No transactions effecting capital stock were noted
during the year ended June 30, 2013.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">8.	STOCK
OPTIONS AND WARRANTS</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><b> </b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif">On
July 10, 2003, the Company adopted the Warp 9, Inc. Stock Option Plan for Directors, Executive Officers, and Employees of and
Key Consultants to the Company. This Plan, may issue 5,000,000 shares of common stock. Options granted under the Plan could be
either Incentive Options or Nonqualified Options, and are administered by the Company’s Board of Directors. Each option
may be exercisable in full or in installment and at such time as designated by the Board. Notwithstanding any other provision
of the Plan or of any Option agreement, each option are to expire on the date specified in the Option agreement, which date are
to be no later than the tenth anniversary of the date on which the Option was granted (fifth anniversary in the case of an Incentive
Option granted to a greater-than-10% stockholder). The purchase price per share of the Common Stock under each Incentive Option
is to be no less than the Fair Market Value of the Common Stock on the date the option was granted (110% of the Fair Market Value
in the case of a greater-than-10% stockholder). The purchase price per share of the Common Stock under each Nonqualified Option
were to be specified by the Board at the time the Option was granted, and could be less than, equal to or greater than the Fair
Market Value of the shares of Common Stock on the date such Nonqualified Option was granted, but were to be no less than the par
value of shares of Common Stock. The plan provided specific language as to the termination of options granted hereunder. </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">The
Company used the historical industry index to calculate volatility, since the Company’s stock history did not represent
the expected future volatility of the Company’s common stock. The fair value of options granted during the year ended June
30, 2013, was determined using the Black Scholes method with the following assumptions:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Year Ended</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">6/30/2013</font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="width: 70%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Risk free interest rate</font></td><td style="width: 10%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 18%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">6.00</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">%</font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Stock volatility factor</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">171</font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Weighted average expected option life</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">7
years</font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Expected dividend yield</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">none</font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0pt; text-align: justify; text-indent: 0.5in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0pt; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">A
summary of the Company’s stock option activity and related information follows:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="7" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Year
ended<br /> June 30, 2014</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="7" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Year
ended<br /> June 30, 2013</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Weighted</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Weighted</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">average</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">average</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">exercise</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">exercise</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Options</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">price</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Options</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">price</font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="width: 40%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Outstanding -beginning of year</font></td><td style="width: 3%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">13,508,000</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 3%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">0.005</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 3%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">3,578,000</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 3%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">0.01</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Granted</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">12,500,000</font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">0.005</font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Exercised</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Forfeited</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(508,000</font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.005</font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(2,570,000</font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.007</font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Outstanding - end
of year</font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">13,000,000</font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.005</font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">13,508,000</font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.005</font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Exercisable at
the end of year</font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">8,170,776</font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.005</font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">4,101,184</font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.005</font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Weighted average fair value of</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> options granted
during the year</font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.005</font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
</table>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">  </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The
Black Scholes option valuation model was developed for use in estimating the fair value of traded options, which do not have vesting
restrictions and are fully transferable. In addition, option valuation models require the input of highly subjective assumptions,
including the expected stock price volatility. Because the Company’s employee stock options have characteristics significantly
different from those of traded options, and because changes in the subjective input assumptions can materially affect the fair
value estimate, in management’s opinion, the existing models do not necessarily provide a reliable single measure of the
fair value of its employee stock options.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The
weighted average remaining contractual life of options outstanding, as of June 30, 2014 was as follows:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Weighted</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Average</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Number
of</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">remaining</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Exercise</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">options</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">contractual</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">prices</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">outstanding</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">life
(years)</font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="width: 26%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">0.005</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 8%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 26%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">12,500,000</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 8%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 26%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">5.12</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="padding-bottom: 1pt; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">0.004</font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">500,000</font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">7.29</font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">13,000,000</font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
</table>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Warrants</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">During
the years ended June 30, 2014 and 2013, the Company issued no warrants for services. A summary of the Company’s warrant
activity and related information follows:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="7" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Year
End</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="7" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Year
End</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="7" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">June
30, 2014</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="7" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">June
30, 2013</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Weighted</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Weighted</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">average</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">average</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">exercise</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">exercise</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Options</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">price</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Options</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">price</font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="width: 40%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Outstanding
-beginning of year</font></td><td style="width: 3%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">28,019,163</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 3%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">0.003</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 3%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">28,019,163</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 3%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">0.003</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Granted</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Exercised</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Forfeited</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Outstanding
- end of year</font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">28,019,163</font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.003</font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">28,019,163</font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.003</font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
</table>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b> </b></font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"></p>
<p style="margin: 0; font: 10pt Times New Roman, Times, Serif; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">The
weighted average remaining contractual life of warrants outstanding as of June 30, 2014 was as follows:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> 	</font></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Weighted</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Average</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Number
of</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">remaining</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Exercise</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">options</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">contractual</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">prices</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">outstanding</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">life
(years)</font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="width: 26%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">0.003</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 8%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 26%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">28,019,163</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 8%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 26%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">1.77</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr></table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">9.	CONCENTRATIONS</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="margin: 0; font: 10pt Times New Roman, Times, Serif; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">For
the year ended June 30, 2014, the Company had one major customer who represented approximately 37% of total revenue. For
the year ended June 30, 2013, the Company had two major customers who represented 33% and 13%, respectively, of total
revenue. At June 30, 2014 and 2013, accounts receivable from four customers represented approximately 46% and 84% of total
accounts receivable, respectively. The customers comprising the concentrations within the accounts receivable are not the
same customers that comprise the concentrations with the revenues discussed above.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">10.	COMMITMENTS
AND CONTINGENCIES</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Operating
Leases</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">On
August 26, 2013, the Company signed a two year lease commencing on October 1, 2013 for approximately 2,534 square feet of office
space at 1933 Cliff Dr., Suite 11, Santa Barbara, California 93109for approximately $4,308 per month. The following is a schedule,
by years, of future minimum rental payments required under the operating lease.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify; text-indent: 0.5in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="color: Red; font: bold 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="text-align: center; vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td colspan="2" style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Years
Ending<br /> June 30,</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Rent
Payment</font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="width: 43%; text-align: left; vertical-align: bottom; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">2015</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 10%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="width: 43%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">53,760</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; vertical-align: bottom; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">2016</font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">13,182</font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
</table>
<p style="color: Red; font: bold 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif">Total
lease expense for the years ended June 30, 2014 and 2013was $97,191 and $151,148, respectively. The Company is also required to
pay its pro rata share of taxes, building maintenance costs, and insurance in according to the lease agreement. </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif">On
May 21, 2014, the Company entered into a settlement agreement with the landlord of our previous location, to make monthly payments
on past due rent of $227,052. Under the terms of the agreement, the Company will make monthly payments of $350 on a reduced balance
of $40,250. Upon payment of $40,250, the Company will record a gain on extinguishment of debt of $186,802. As of June 30, 2014,
the Company recorded the outstanding balance under this settlement agreement as a long term notes payable, with the current portion
of the debt recorded in accrued expenses. </font></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif"><u>Legal
Matters</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify; text-indent: 0in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif">The
Company may be involved in legal actions and claims arising in the ordinary course of business, from time to time, none of which
at the time are considered to be material to the Company’s business or financial condition. </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">11. SUPPLEMENTAL
STATEMENT OF CASH FLOWS INFORMATION</font></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: -0.25in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif">During
the year ended June 30, 2014, we had the following non-cash financing activities:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0pt; margin-left: 0pt; text-indent: 0pt; text-align: justify"><font style="font: normal 10pt Times New Roman, Times, Serif">•
Decreased notes payable, Wings Fund by $18,975, increased common stock by $4,744 and additional paid-in capital by $14,231 for
common shares as a result of a partial conversion of the March 2013 Note.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif">12. SUBSEQUENT
EVENTS</font></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: -0.25in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif">Management
has evaluated subsequent events according to ASC TOPIC 855 as of the date of the financial statements and has determined that
the following subsequent events are reportable.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">On
September 5, 2014, the Company entered into a convertible promissory note (“the September 2014 Note”) in the amount
of $250,000, at which time an initial advance of $40,000 was received to cover operational expenses. The lender advanced an additional
$10,000 onSeptember 17, 2014, for a total draw of $50,000. The terms of the September 2014 Note allow the lender to convert all
or part of the outstanding balance plus accrued interest, at any time after the effective date, at a conversion price of the lower
of (a) $0.015 per share, or (b) 50% of the lowest trade price of Common Stock recorded on any trade day after the effective date
of the agreement. The September 2014 Note bears interest at a rate of 10% per year and matures18 months from the effective date
of each advance.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Accounts
receivable</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif">The
Company extends credit to its customers, who are located nationwide. Accounts receivable are customer obligations due under normal
trade terms. The Company performs continuing credit evaluations of its customers’ financial condition. Management reviews
accounts receivable on a regular basis, based on contracted terms and how recently payments have been received to determine if
any such amounts will potentially be uncollected. The Company includes any balances that are determined to be uncollectible in
its allowance for doubtful accounts. After all attempts to collect a receivable have failed, the receivable is written off. The
balance of the allowance account at June 30, 2014 and 2013 are $24,907 and $24,907 respectively.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif"><u>Use
of Estimates</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">The
preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates
and assumptions that affect the amounts reported in the accompanying financial statements. Significant estimates made in preparing
these financial statements include the allowance for doubtful accounts, the estimate of useful lives of property and equipment,
the deferred tax valuation allowance, and the fair value of stock options and warrants. Actual results could differ from those
estimates.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Cash
and Cash Equivalents </u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">The
Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Revenue
recognition</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">The
Company recognizes income when the service is provided or when product is delivered. We present revenue, net of customer incentives.
Most of the income is generated from professional services and site development fees.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">We
provide online marketing services that we purchase from third parties. The gross revenue presented in our statement of operations
is in accordance with ASC 605-45.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">We
also offer professional services such as development services.  The fees for development services with multiple deliverables
constitute a separate unit of accounting in accordance with ASC 605-25, which are recognized as the work is performed.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Upfront
fees for development services or other customer services are deferred until certain implementation or contractual milestones have
been achieved. The deferred revenue as of June 30, 2014 and 2013 was $3,300 and zero, respectively.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">For
the fiscal year ended, June 30, 2014, monthly recurring fees for mobile and desktop e-commerce development account for 19% of
the Company’s total revenues, professional services account for 79% and the remaining 2% of total revenues are from resale
of third party products and services.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">For
the fiscal year ended, June 30, 2013, monthly recurring fees for mobile and desktop e-commerce development account for 24% of
the Company’s total revenues, professional services account for 72% and the remaining 4% of total revenues are from resale
of third party products and services.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Cost
of Revenue</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Cost
of revenue includes the direct costs of operating the Company’s cloud hosting architecture, contractors involved in the
production process and certain third party internet marketing charges.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Research
and Development</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Research
and development costs are expensed as incurred. Total research and development costs were zero and $13,307 for the years ended
June 30, 2014 and 2013, respectively.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Advertising
Costs </u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">The
Company expenses the cost of advertising and promotional materials when incurred. Total advertising costs were $22,137 and $498
for the years ended June 30, 2014 and 2013, respectively.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Fair
value of financial instruments</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">The
Company’s financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and accrued
liabilities are carried at cost, which approximates their fair value, due to the relatively short maturity of these instruments.
As of June 30, 2014 and 2013, the Company’s capital lease obligations and notes payable have stated borrowing rates that
are consistent with those currently available to the Company and, accordingly, the Company believes the carrying value of these
debt instruments approximates their fair value.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Fair
value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date. ASC Topic 820 established a three-tier fair value hierarchy which prioritizes
the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets
for identical assets or liabilities (level 1measurements) and the lowest priority to unobservable inputs (level 3 measurements).
These tiers include:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify; background-color: white"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%">
<tr style="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
<td style="width: 10%; padding-left: 0; text-align: justify; font: 10pt Times New Roman, Times, Serif">•</td>
<td style="width: 90%; padding-left: 0; text-align: justify; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Level
1, defined as observable inputs such as quoted prices for identical instruments in active markets;</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 45pt; text-align: justify; background-color: white"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%">
<tr style="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
<td style="width: 10%; font: 10pt Times New Roman, Times, Serif">•<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></p></td>
<td style="width: 90%; padding-left: 0; text-align: justify; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Level
2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as
quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that
are not active; and</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 45pt; text-align: justify; background-color: white"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%">
<tr style="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
<td style="width: 10%; font: 10pt Times New Roman, Times, Serif">•<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></p></td>
<td style="width: 90%; padding-left: 0; text-align: justify; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Level
3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own
assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value
drivers are unobservable.</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; background-color: white"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">We
measure certain financial instruments at fair value on a recurring basis. Assets and liabilities measured at fair value on a recurring
basis are as follows at June 30, 2014:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in"></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 9pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td style="text-align: left; padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">For
the year ended June 30, 2014</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Total</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(Level
1)</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(Level
2)</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(Level
3)</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="width: 40%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Assets</font></td><td style="width: 3%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 3%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 3%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 3%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Total
assets measured at fair value</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Liabilities</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Derivative
liability</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">2,169,051</font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">2,169,051</font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Convertible
notes, net of discount</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">150,536</font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">150,536</font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Total
liabilities measured at fair value</font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2,319,587</font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2,319,587</font></td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr>
</table>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> Assets
and liabilities measured at fair value on a recurring basis are as follows at June 30, 2013:</font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in"> </p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in"></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td style="text-align: center"> </td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">Total</td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">(Level 1)</td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">(Level 2)</td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">(Level 3)</td></tr>
<tr style="vertical-align: bottom">
<td> </td><td> </td>
<td colspan="3" style="text-align: center"> </td><td> </td>
<td colspan="3" style="text-align: center"> </td><td> </td>
<td colspan="3" style="text-align: center"> </td><td> </td>
<td colspan="3" style="text-align: center"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="width: 40%">Assets</td><td style="width: 3%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 10%; text-align: right">—  </td><td style="width: 1%; text-align: left"> </td><td style="width: 3%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 10%; text-align: right">—  </td><td style="width: 1%; text-align: left"> </td><td style="width: 3%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 10%; text-align: right">—  </td><td style="width: 1%; text-align: left"> </td><td style="width: 3%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 10%; text-align: right">—  </td><td style="width: 1%; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"> </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"> </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"> </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"> </td><td style="padding-bottom: 1pt; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left; padding-bottom: 1pt">Total assets measured at fair value</td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td><td style="border-bottom: Black 1pt solid; text-align: right">—  </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td><td style="border-bottom: Black 1pt solid; text-align: right">—  </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td><td style="border-bottom: Black 1pt solid; text-align: right">—  </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td><td style="border-bottom: Black 1pt solid; text-align: right">—  </td><td style="padding-bottom: 1pt; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td>Liabilities</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">Derivative liability</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; padding-bottom: 1pt">Convertible notes, net of discount</td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">126,984</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">—  </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">—  </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">126,984</td><td style="padding-bottom: 1pt; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left; padding-bottom: 2.5pt">Total liabilities measured at fair value</td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">126,984</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">—  </td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">—  </td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">126,984</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr></table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Property
and Equipment</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Property
and equipment are stated at cost, and are depreciated or amortized using the straight-line method over the following estimated
useful lives:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="width: 45%; text-align: left">Furniture, fixtures & equipment</td><td style="width: 10%"> </td>
<td style="width: 45%; text-align: right">7 Years</td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">Computer equipment</td><td> </td>
<td style="text-align: right">5 Years</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">Commerce server</td><td> </td>
<td style="text-align: right">5 Years</td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">Computer software</td><td> </td>
<td style="text-align: right">3 - 5 Years</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">Leasehold improvements</td><td> </td>
<td style="text-align: right">Length of the lease</td></tr>
</table>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Depreciation
expenses were$42,747 and $23,495 for the years ended June 30, 2014 and 2013, respectively.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif"><u>Concentrations
of Business and Credit Risk</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">The
Company operates in a single industry segment. The Company markets its services to companies and individuals in many industries
and geographic locations. The Company’s operations are subject to rapid technological advancement and intense competition
in the telecommunications industry. Accounts receivable represent financial instruments with potential credit risk. The Company
typically offers its customers credit terms. The Company makes periodic evaluations of the credit worthiness of its enterprise
customers and other than obtaining deposits pursuant to its policies, it generally does not require collateral. In the event of
nonpayment, the Company has the ability to terminate services.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Stock-Based
Compensation</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">The
Company addressed the accounting for share-based payment transactions in which an enterprise receives employee services in exchange
for either equity instruments of the enterprise or liabilities that are based on the fair value of the enterprise’s equity
instruments or that may be settled by the issuance of such equity instruments. The transactions are accounted for using a fair-value-based
method and recognized as expenses in our statement of income.There was no material impact on the Company’s financial statement
of operations.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Stock-based
compensation expense recognized during the period is based on the value of the portion of stock-based payment awards that is
ultimately expected to vest. Stock-based compensation expense recognized in the consolidated statement of operations during
the year ended June 30, 2014, included compensation expense for the stock-based payment awards granted prior to, but not yet
vested, as of June 30, 2014 based on the grant date fair value estimated. Stock-based compensation expense recognized in the
statement of operationsfor the year ended June 30, 2014 is based on awards ultimately expected to vest, or has been reduced
for estimated forfeitures. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if
actual forfeitures differ from those estimates. The stock-based compensation expense recognized in the consolidated
statements of operations during the year ended June 30, 2014 and 2013was $22,986 and $21,010, respectively.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Earnings
Per Share</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Earnings
per Share require the Company to calculate earnings per share based on basic and diluted earnings per share, as defined. Basic
earnings per share exclude dilution and are computed by dividing net income by theweighted average number of shares outstanding
for the period. Diluted earnings per share reflect the potential dilution that could occur if stock options and warrants to issue
common stock were exercised or converted into common stock. For the year ended June 30, 2014, since the Company reported a net
loss, the additional diluted shares would have had an anti-dilutive effect. Therefore, all additional shares that would have been
included in the diluted earnings per share calculation were excluded, and the basic and diluted earnings per share numbers are
identical.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Income
Taxes</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif">The
Company uses the liability method of accounting for income taxes. Deferred tax assets and liabilities are recognized for the future
tax consequences attributable to financial statements carrying amounts of existing assets and liabilities and their respective
tax bases and operating loss and tax credit carry-forwards. The measurement of deferred tax assets and liabilities is based on
provisions of applicable tax law. The measurement of deferred tax assets is reduced, if necessary, by a valuation allowance based
on the amount of tax benefits that, based on available evidence, is not expected to be realized.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif"><u>Recently
Issued Accounting Pronouncements</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Management
reviewed accounting pronouncements issued during the twelve months ended June 30, 2014, and no pronouncements were adopted during
the period.</font></p>
<p style="font: bold 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: normal 10pt Times New Roman, Times, Serif; background-color: white">The
Company adopted ASC 815 "Accounting for Derivative Instruments and Hedging Activities". This pronouncement addresses
the accounting for derivative instruments including certain derivative instruments embedded in other contracts, and hedging activities.
Derivative instruments that meet the definition of assets and liabilities should be reported in the financial statements at fair
value, and any gain or loss should be recognized in current earnings.  The adoption of this pronouncement had a material
effect on the financial statements of the Company.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">We
measure certain financial instruments at fair value on a recurring basis. Assets and liabilities measured at fair value on a recurring
basis are as follows at June 30, 2014:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in"></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 9pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td style="text-align: left; padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">For
the year ended June 30, 2014</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Total</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(Level
1)</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(Level
2)</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">(Level
3)</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="width: 40%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Assets</font></td><td style="width: 3%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 3%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 3%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 3%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Total
assets measured at fair value</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Liabilities</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Derivative
liability</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">2,169,051</font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">2,169,051</font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Convertible
notes, net of discount</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">150,536</font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">150,536</font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Total
liabilities measured at fair value</font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2,319,587</font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2,319,587</font></td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr>
</table>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><font style="font: 10pt Times New Roman, Times, Serif"> Assets
and liabilities measured at fair value on a recurring basis are as follows at June 30, 2013:</font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in"> </p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in"></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td style="text-align: center"> </td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">Total</td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">(Level 1)</td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">(Level 2)</td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">(Level 3)</td></tr>
<tr style="vertical-align: bottom">
<td> </td><td> </td>
<td colspan="3" style="text-align: center"> </td><td> </td>
<td colspan="3" style="text-align: center"> </td><td> </td>
<td colspan="3" style="text-align: center"> </td><td> </td>
<td colspan="3" style="text-align: center"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="width: 40%">Assets</td><td style="width: 3%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 10%; text-align: right">—  </td><td style="width: 1%; text-align: left"> </td><td style="width: 3%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 10%; text-align: right">—  </td><td style="width: 1%; text-align: left"> </td><td style="width: 3%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 10%; text-align: right">—  </td><td style="width: 1%; text-align: left"> </td><td style="width: 3%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 10%; text-align: right">—  </td><td style="width: 1%; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"> </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"> </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"> </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"> </td><td style="padding-bottom: 1pt; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left; padding-bottom: 1pt">Total assets measured at fair value</td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td><td style="border-bottom: Black 1pt solid; text-align: right">—  </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td><td style="border-bottom: Black 1pt solid; text-align: right">—  </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td><td style="border-bottom: Black 1pt solid; text-align: right">—  </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td><td style="border-bottom: Black 1pt solid; text-align: right">—  </td><td style="padding-bottom: 1pt; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td>Liabilities</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">Derivative liability</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; padding-bottom: 1pt">Convertible notes, net of discount</td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">126,984</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">—  </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">—  </td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">126,984</td><td style="padding-bottom: 1pt; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left; padding-bottom: 2.5pt">Total liabilities measured at fair value</td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">126,984</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">—  </td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">—  </td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">126,984</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr></table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Property
and equipment are stated at cost, and are depreciated or amortized using the straight-line method over the following estimated
useful lives:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="width: 45%; text-align: left">Furniture, fixtures & equipment</td><td style="width: 10%"> </td>
<td style="width: 45%; text-align: right">7 Years</td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">Computer equipment</td><td> </td>
<td style="text-align: right">5 Years</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">Commerce server</td><td> </td>
<td style="text-align: right">5 Years</td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">Computer software</td><td> </td>
<td style="text-align: right">3 - 5 Years</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">Leasehold improvements</td><td> </td>
<td style="text-align: right">Length of the lease</td></tr></table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Following
is the five year maturity schedule for our convertible notes payable:</font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 67.5pt; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 67.5pt; text-align: justify"></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td colspan="2" style="border-bottom: Black 1pt solid">Year ended June 30,</td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">Amount Due</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="width: 43%; text-align: left; vertical-align: bottom">2015</td><td style="width: 1%; text-align: left"> </td><td style="width: 10%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 43%; text-align: right">183,000</td><td style="width: 1%; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; vertical-align: bottom">2016</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left">$</td><td style="text-align: right">285,000</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left; vertical-align: bottom">2017</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left">$</td><td style="text-align: right">—  </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; vertical-align: bottom">2018</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left">$</td><td style="text-align: right">—  </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left; vertical-align: bottom">2019</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left">$</td><td style="text-align: right">—  </td><td style="text-align: left"> </td></tr></table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">The fair value of options granted during the year ended June
30, 2013, was determined using the Black Scholes method with the following assumptions:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td> </td><td> </td>
<td colspan="3" style="text-align: center">Year Ended</td></tr>
<tr style="vertical-align: bottom">
<td> </td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">6/30/2013</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="width: 70%; text-align: left">Risk free interest rate</td><td style="width: 10%"> </td>
<td style="width: 1%; text-align: left"> </td><td style="width: 18%; text-align: right">6.00</td><td style="width: 1%; text-align: left">%</td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">Stock volatility factor</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">171</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td>Weighted average expected option life</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">7 years</font></td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">Expected dividend yield</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">none</font></td><td style="text-align: left"> </td></tr></table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">A summary of the Company’s warrant
activity and related information follows:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><b></b></font></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 9pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="7" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Year
End</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="7" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Year
End</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="7" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">June
30, 2014</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="7" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">June
30, 2013</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Weighted</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Weighted</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">average</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">average</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">exercise</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">exercise</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Options</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">price</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Options</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">price</font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="width: 40%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Outstanding
-beginning of year</font></td><td style="width: 3%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">28,019,163</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 3%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">0.003</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 3%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">28,019,163</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 3%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">0.003</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Granted</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Exercised</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Forfeited</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—  </font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Outstanding
- end of year</font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">28,019,163</font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.003</font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">28,019,163</font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.003</font></td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr></table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The
weighted average remaining contractual life of options outstanding, as of June 30, 2014 was as follows:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"><b></b></font></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Weighted</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Average</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Number
of</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">remaining</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Exercise</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">options</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">contractual</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">prices</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">outstanding</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">life
(years)</font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="width: 26%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">0.005</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 8%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 26%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">12,500,000</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 8%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 26%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">5.12</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="padding-bottom: 1pt; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">0.004</font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">500,000</font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1pt; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">7.29</font></td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 2.5pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">13,000,000</font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr></table>
<p style="margin: 0; font: 10pt Times New Roman, Times, Serif; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">The weighted
average remaining contractual life of warrants outstanding as of June 30, 2014 was as follows:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> 	</font></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Weighted</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Average</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Number
of</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">remaining</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Exercise</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">options</font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">contractual</font></td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">prices</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">outstanding</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">life
(years)</font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="width: 26%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">0.003</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 8%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 26%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">28,019,163</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 8%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 26%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">1.77</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr></table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> The following is a schedule,
by years, of future minimum rental payments required under the operating lease.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify; text-indent: 0.5in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="color: Red; font: bold 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="text-align: center; vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td colspan="2" style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Years
Ending<br /> June 30,</font></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td colspan="3" style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">Rent
Payment</font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="width: 43%; text-align: left; vertical-align: bottom; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">2015</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="width: 10%; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="width: 43%; text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">53,760</font></td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; vertical-align: bottom; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">2016</font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td><td style="font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Times New Roman, Times, Serif">13,182</font></td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr></table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"><u>Return
policy</u></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">On
all service offerings such as web based e-commerce products there are no returns. Monthly fees are assessed and revenue is recognized
at the end of every month, after service has been provided. Some higher paying customers may have service level agreements where
we guarantee system uptime such as 99.9% of the time per month. If we fall below the agreed upon level of uptime, we shall credit
one day of service fee for each hour our system is down up to a maximum of one monthly fee. This guarantee only covers downtime
as a result of failure in the Company’s cloud hosting architecture or gross negligence. Historically, the Company has not
had to issue any credits for such returns.</font></p>
0.06
1.71
P7Y
none
12500000
-2570000
-508000
4101184
8170776
0.005
0.01
0.005
0.005
0.007
0.005
0.005
0.005
0.005
28019163
28019163
28019163
0.003
0.003
0.003
28019163
P1Y9M7D
53760
13182
P7Y
P5Y
P5Y
P3Y
P5Y
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif"><tr style="vertical-align: bottom; background-color: rgb(204,238,255)"><td></td>
<td style="text-align: right">Length of the lease</td></tr></table>
0.003
126984
2319587
2319587
126984
0.0261
0.004
0.012
0.00
P3M
P18M
0.0007
0.0029
1.4245
1.5533
183000
285000
0.33
0.84
0.19
0.79
0.02
0.24
0.72
0.04
0.37
0.13
0.46
24907
24907
498
22137
45815
49799
100000
100000
75000
210000
50000
100000
100000
250000
300000
250000
<p style="margin: 0">The terms of the March 2013 Note allow the lender to convert all or part of the outstanding balance plus accrued
interest, at any time after the effective date, at a conversion price of the lower of (a) $0.015 per share, or (b) 50% of the lowest
trade price of Common Stock recorded on any trade day after the effective date of the agreement.</p>
<p style="margin: 0">The terms of the May 2013 Note allow the lender to convert all or part of the outstanding balance plus accrued
interest, at any time after the effective date, at a conversion price of the lower of (a) $0.015 per share, or (b) 50% of the lowest
trade price of Common Stock recorded on any trade day after the effective date of the agreement.</p>
<p style="margin: 0">The terms of the March 2014 Note allow the lender to convert all or part of the outstanding balance plus accrued
interest, at any time after the effective date, at a conversion price of the lower of (a) $0.012 per share, or (b) 50% of the lowest
trade price of Common Stock recorded on any trade day after the effective date of the agreement.</p>
<p style="margin: 0">The terms of the April 2014 Note allow the lender to convert all or part of the outstanding balance plus accrued
interest, at any time after the effective date, at a conversion price of the lower of (a) $0.012 per share, or (b) 50% of the lowest
trade price of Common Stock recorded on any trade day after the effective date of the agreement.</p>
<p style="margin: 0">The terms of the September 2014 Note allow the lender to convert all or part of the outstanding balance plus
accrued interest, at any time after the effective date, at a conversion price of the lower of (a) $0.015 per share, or (b) 50%
of the lowest trade price of Common Stock recorded on any trade day after the effective date of the agreement.</p>
0.10
0.10
0.10
0.10
0.10
0.10
2015-09-25
2014-11-16
20000
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0pt; text-align: justify">It matures 18 months from the
effective date of each advance.</p>
<p><font style="font: 10pt Times New Roman, Times, Serif">It matures eighteen 18 months from the effective date of each
advance.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify; text-indent: -20pt">It matures 18 months from the
effective date of each advance.</p>
339981
56000
75000
210000
<p style="margin: 0">This discount is being recognized over twelve months, beginning on the date of each tranche payment.</p>
<p style="margin: 0">This discount is recognized over 18 months, beginning on the date of each tranche payment.</p>
<p style="margin: 0">This discount is recognized over 18 months, beginning on the date of each tranche payment.</p>
0.39
6565000
<p style="margin: 0">That may be offset against future taxable income from the year 2013 through 2032.</p>
5000000
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify; text-indent: 0in"><font style="font-weight: normal">On
July 10, 2003, the Company adopted the Warp 9, Inc. Stock Option Plan for Directors, Executive Officers, </font>and
Employees of and Key Consultants to the Company. This Plan, may issue 5,000,000 shares of common stock. Options granted under
the Plan could be either Incentive Options or Nonqualified Options, and are administered by the Company’s Board of
Directors. Each option may be exercisable in full or in installment <font style="font-weight: normal">and at such time as
designated by the Board. Notwithstanding any other provision of the Plan or of any Option agreement, each option are to
expire on the date specified in the Option agreement, which date are to be no later than the tenth anniversary of the date on
which the Option was granted (fifth anniversary in the case of an Incentive Option granted to a greater-than-10%
stockholder). The purchase price per share of the Common Stock under each Incentive Option is to be no less than the Fair
Market Value of the Common Stock on the date the option was granted (110% of the Fair Market Value in the case of a
greater-than-10% stockholder). The purchase price per share of the Common Stock under each Nonqualified Option were to be
specified by the Board at the time the Option was granted, and could be less than, equal to or greater than the Fair Market
Value of the shares of Common Stock on the date such Nonqualified Option was granted, but were to be no less than the par
value of shares of Common Stock. The plan provided specific language as to the termination of options granted hereunder. </font></p>
4308
97191
151148
<p style="margin: 0">On August 26, 2013, the Company signed a two year lease commencing on October 1, 2013 for approximately 2,534
square feet of office space at 1933 Cliff Dr., Suite 11, Santa Barbara, California 93109 for approximately $4,308 per month.</p>
<p style="margin: 0">On May 21, 2014, the Company entered into a settlement agreement with the landlord of our previous location,
to make monthly payments on past due rent of $227,052. Under the terms of the agreement, the Company will make monthly payments
of $350 on a reduced balance of $40,250. Upon payment of $40,250, the Company will record a gain on extinguishment of debt of $186,802.</p>
18975
6117
-1869301
21010
21010
22986
22986
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">
The significant assumptions used in the Black Scholes valuation of the derivative are as follows:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">  </font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 67.5pt; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><b></b></font></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="width: 56%; text-align: left">Stock price on the valuation dates</td><td style="width: 1%"> </td>
<td style="width: 1%; text-align: left"> </td><td style="width: 12%; text-align: right"> </td><td style="width: 1%; text-align: left"> </td><td style="width: 8%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 19%; text-align: right">0.0261</td><td style="width: 1%; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">Conversion price for the debt</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"></td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left">$</td><td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.004 - 0.012</font></td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">Dividend yield</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">0</td><td style="text-align: left">%</td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">Years to maturity</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">3 months - 18 months</font></td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">Risk free rate</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.07% - 0.29%</font></td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">Expected volatility</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">142.45% - 155.33%</font></td><td style="text-align: left"> </td></tr></table>
2169051
2169051
126984
150536
150536
126984
154429
3342
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">Net
deferred tax assets consist of the following components as of June 30, 2014 and 2013:</font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify; text-indent: 0.5in"> </p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify; text-indent: 0.5in"></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify; text-indent: 0.5in"></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td> </td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">June 30, 2014</td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">June 30, 2013</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">Deferred tax assets:</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="width: 56%; text-align: left">   NOL carryforward</td><td style="width: 8%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 12%; text-align: right">2,560,300</td><td style="width: 1%; text-align: left"> </td><td style="width: 8%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 12%; text-align: right">2,349,100</td><td style="width: 1%; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td>   R&D carryforward</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">113,100</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">300</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">   Capital loss carryforward</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">11,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">12,000</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">   Accrued vacation payable</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">23,500</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">8,600</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">   Allowance for doubtful accounts</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">9,700</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">9,700</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">   Contribution carryforward</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">200</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">200</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">   Related party accruals</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">1,000</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">Deferred tax liabilities:</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td>   Depreciation</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">(2,700</td><td style="text-align: left">)</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">(12,500</td><td style="text-align: left">)</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; padding-bottom: 1pt">Valuation allowance</td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(2,715,100</td><td style="padding-bottom: 1pt; text-align: left">)</td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(2,368,400</td><td style="padding-bottom: 1pt; text-align: left">)</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left; padding-bottom: 2.5pt">Net deferred tax asset</td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">—  </td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">—  </td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr></table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">The
income tax provision differs from the amount of income tax determined by applying the U.S. federal and state income tax rate of
39% to pretax income from continuing operations for the years ended June 30, 2014 and 2013 due to the following:</font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"> </p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0"></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td> </td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">June 30, 2014</td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">June 30, 2013</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="width: 56%; text-align: left">Book income</td><td style="width: 8%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 12%; text-align: right">(941,500</td><td style="width: 1%; text-align: left">)</td><td style="width: 8%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 12%; text-align: right">(130,200</td><td style="width: 1%; text-align: left">)</td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">Nondeductible expenses</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">747,400</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">8,700</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">Accrued vacation payable</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">(15,000</td><td style="text-align: left">)</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">(2,200</td><td style="text-align: left">)</td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">Allowance for bad debt</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">(10,700</td><td style="text-align: left">)</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td>Depreciation</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">10,100</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">(1,400</td><td style="text-align: left">)</td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left">Excess loss on disposal over book</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">(15,500</td><td style="text-align: left">)</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">Contributed services</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">4,700</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td>R&D credit</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">100</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left">Related party accruals</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">(1,000</td><td style="text-align: left">)</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">1,000</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left; padding-bottom: 1pt">Valuation allowance</td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">215,500</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">130,000</td><td style="padding-bottom: 1pt; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; padding-bottom: 2.5pt">Income tax expense</td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">—  </td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">—  </td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr></table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0pt; text-align: justify; text-indent: 0"><font style="font: 10pt Times New Roman, Times, Serif">A
summary of the Company’s stock option activity and related information follows:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></p>
<p style="color: Red; font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 9pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td> </td><td style="padding-bottom: 1pt"> </td>
<td colspan="7" style="text-align: center; border-bottom: Black 1pt solid">Year ended<br /> June 30, 2014</td><td style="padding-bottom: 1pt"> </td>
<td colspan="7" style="text-align: center; border-bottom: Black 1pt solid">Year ended<br /> June 30, 2013</td></tr>
<tr style="vertical-align: bottom">
<td> </td><td> </td>
<td colspan="3" style="text-align: center"> </td><td> </td>
<td colspan="3" style="text-align: center">Weighted</td><td> </td>
<td colspan="3" style="text-align: center"> </td><td> </td>
<td colspan="3" style="text-align: center">Weighted</td></tr>
<tr style="vertical-align: bottom">
<td> </td><td> </td>
<td colspan="3" style="text-align: center"> </td><td> </td>
<td colspan="3" style="text-align: center">average</td><td> </td>
<td colspan="3" style="text-align: center"> </td><td> </td>
<td colspan="3" style="text-align: center">average</td></tr>
<tr style="vertical-align: bottom">
<td> </td><td> </td>
<td colspan="3" style="text-align: center"> </td><td> </td>
<td colspan="3" style="text-align: center">exercise</td><td> </td>
<td colspan="3" style="text-align: center"> </td><td> </td>
<td colspan="3" style="text-align: center">exercise</td></tr>
<tr style="vertical-align: bottom">
<td> </td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">Options</td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">price</td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">Options</td><td style="padding-bottom: 1pt"> </td>
<td colspan="3" style="text-align: center; border-bottom: Black 1pt solid">price</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="width: 40%">Outstanding -beginning of year</td><td style="width: 3%"> </td>
<td style="width: 1%; text-align: left"> </td><td style="width: 10%; text-align: right">13,508,000</td><td style="width: 1%; text-align: left"> </td><td style="width: 3%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 10%; text-align: right">0.005</td><td style="width: 1%; text-align: left"> </td><td style="width: 3%"> </td>
<td style="width: 1%; text-align: left"> </td><td style="width: 10%; text-align: right">3,578,000</td><td style="width: 1%; text-align: left"> </td><td style="width: 3%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 10%; text-align: right">0.01</td><td style="width: 1%; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td>Granted</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left">$</td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">12,500,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left">$</td><td style="text-align: right">0.005</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td>Exercised</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left">$</td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">—  </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left">$</td><td style="text-align: right">—  </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-bottom: 1pt">Forfeited</td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(508,000</td><td style="padding-bottom: 1pt; text-align: left">)</td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td><td style="border-bottom: Black 1pt solid; text-align: right">0.005</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(2,570,000</td><td style="padding-bottom: 1pt; text-align: left">)</td><td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td><td style="border-bottom: Black 1pt solid; text-align: right">0.007</td><td style="padding-bottom: 1pt; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left; padding-bottom: 2.5pt">Outstanding - end of year</td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">13,000,000</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">0.005</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">13,508,000</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">0.005</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; padding-bottom: 2.5pt">Exercisable at the end of year</td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">8,170,776</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">0.005</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">4,101,184</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">0.005</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td>Weighted average fair value of</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; padding-bottom: 2.5pt"> options granted during the year</td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right"> </td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">—  </td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right"> </td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">0.005</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr>
</table>
2368400
2715100
12500
2700
1000
200
200
9700
9700
8600
23500
12000
11000
300
113100
2349100
2560300
130000
215500
1000
-1000
100
4700
-15500
-1400
10100
-10700
-2200
-15000
8700
747400
130200
941500