From April 26, 2012 to January 24, 2013, the Company sold convertible notes to unaffiliated accredited investors totaling $2,675,244. The notes have a term of three years, bear interest at 12% per annum, and are convertible into units, where each unit consists of: (i) one share of common stock of the Issuer, par value $0.001 per share, and (ii) a warrant to purchase 0.25 shares of common stock of the Issuer at an exercise price of $1.25 per share. The initial conversion ratio shall be equal to $1.00 per unit. The notes may be converted at any time and from time to time in whole or in part prior to the maturity date thereof. These securities were sold in reliance upon the exemption provided by Section 4(2) of the Securities Act and the safe harbor of Rule 506 under Regulation D promulgated under the Securities Act. From March 19, 2014 to May 23, 2014, the Company converted $85,427 of these notes into 85,427 shares of common stock and 21,357 warrants to purchase shares of common stock (see Note 12). Accrued interest of $301,165 was converted to principal by the Company during 2013. Accrued interest on these advances at December 31, 2013 was $178,585, and was converted to principal by the Company on January 1, 2014. Accrued interest at June 30, 2014 on these notes was $185,038, and was converted to principal by the Company on July 1, 2014. Interest expense for the six months ended June 30, 2014 and 2013, was $185,038 and $166,190, respectively.  

From April 5 through May 10, 2013, the Company sold convertible notes to unaffiliated accredited investors totaling $405,000. The notes have a term of three years, bear interest at 12% per annum, and are convertible into units, where each unit consists of: (i) 1 share of common stock of the Issuer, par value $0.001 per share, and (ii) a warrant to purchase 0.25 shares of common stock of the Issuer at an exercise price of $0.75 per share. The initial conversion ratio shall be equal to $0.50 per unit. The notes may be converted at any time and from time to time in whole or in part prior to the maturity date thereof. These securities were sold in reliance upon the exemption provided by Section 4(2) of the Securities Act and the safe harbor of Rule 506 under Regulation D promulgated under the Securities Act. Accrued interest on these advances at December 31, 2013 was $32,127, and was converted to principal by the Company on January 1, 2014. Accrued interest at June 30, 2014 on these notes was $26,228 and was converted to principal by the Company on July 1, 2014. Interest expense for the six months ended June 30, 2014 and 2013 was $26,228 and $8,645, respectively. 

On June 27 and June 30, 2013, the Company converted advances payable from related parties (see Note 9) into convertible notes totaling $1,036,195. The notes have a term of three years, bear interest at 12% per annum, and are convertible into units, where each unit consists of: (i) 1 share of common stock of the Issuer, par value $0.001 per share, and (ii) a warrant to purchase 0.25 shares of common stock of the Issuer at an exercise price of $0.75 per share. The initial conversion ratio shall be equal to $0.50 per unit. The notes may be converted at any time and from time to time in whole or in part prior to the maturity date thereof. These securities were issued in reliance upon the exemption provided by Section 4(2) of the Securities Act and the safe harbor of Rule 506 under Regulation D promulgated under the Securities Act. On July 12, 2013, the Company converted $866,211 of these notes, along with accrued interest of $4,331, into 1,741,084 shares of common stock and 435,271 warrants to purchase shares of common stock (see Note 12). Accrued interest at December 31, 2013 was $10,256, and was converted to principal by the Company on January 1, 2014. Accrued interest at June 30, 2014 on these notes was $10,814 and was converted to principal by the Company on July 1, 2014. Interest expense for the six months ended June 30, 2014 and 2013 was $10,814 and $393, respectively.

From July 30, 2013 through December 24, 2013, the Company sold convertible notes and warrants to unaffiliated accredited investors totaling $1,902,500. The notes have a term of three years, bear interest at 10% per annum, and are convertible into one share of common stock, par value $0.001 per share, with the initial conversion ratio equal to $0.50 per share. For each dollar invested, the investor received two warrants to purchase one shares of common stock of the Issuer at an exercise price of $0.75 per share. The notes may be converted at any time and from time to time in whole or in part prior to the maturity date thereof. These securities were sold in reliance upon the exemption provided by Section 4(2) of the Securities Act and the safe harbor of Rule 506 under Regulation D promulgated under the Securities Act. From January 30, 2014 to June 24, 2014, the Company converted $82,500 of these notes, along with accrued interest of $1,308, into 167,616 shares of common stock (see Note 12). Accrued interest at December 31, 2013 and interest expense for the year ended December 31, 2013 on these notes was $52,910, and was paid with the issuance of 87,144 shares of common stock in January 2014. Accrued interest at June 30, 2014 on these notes was $203,577 and was paid with the issuance of 184,411 shares of common stock in July 2014. Interest expense for the six months ended June 30, 2014 was $203,507. A discount on the notes payable of $841,342 was recorded based on the value of the warrants issued using a Black-Scholes options pricing model. Amortized interest expense for six months ended June 30, 2014 and the year ended December 31, 2013 on this discount was $138,945 and $63,122, respectively.