Quarterly report pursuant to Section 13 or 15(d)

PROPERTY AND EQUIPMENT

PROPERTY AND EQUIPMENT

9 Months Ended

Sep. 30, 2013

NOTE 3 - PROPERTY AND EQUIPMENT

Property and equipment at September 30, 2013 and December 31, 2012 consists of the following:

		September 30, 2013		December 31, 2012
		(Unaudited)
Furniture and fixtures	$	43,017	$	51,617
Equipment		60,000		112,879
Leasehold improvements		-		151,859

		103,017		316,355
Less accumulated depreciation and amortization		(3,017)		(303,152)

	$	100,000	$	13,203

Depreciation and amortization was $13,203 and $50,862 for the nine months ended September 30, 2013 and 2012 respectively. On March 31, 2013, the lease expired for the office and production space located in Scottsdale, Arizona. Fully depreciated fixed assets of $298,765 were written off as a result of the lease expiration.

On August 19, 2013, the Company acquired assets from Essex Angel Capital (Note 10) for a total of $1,491,281. $100,000 of the purchase price was allocated to Property and Equipment, and $1,391,281 was allocated to Definite-life intangible assets.

- Definition

The entire disclosure for long-lived, physical assets that are used in the normal conduct of business to produce goods and services and not intended for resale. Examples include land, buildings, machinery and equipment, and other types of furniture and equipment including, but not limited to, office equipment, furniture and fixtures, and computer equipment and software. This disclosure may include property plant and equipment accounting policies and methodology, a schedule of property, plant and equipment gross, additions, deletions, transfers and other changes, depreciation, depletion and amortization expense, net, accumulated depreciation, depletion and amortization expense and useful lives, income statement disclosures, assets held for sale and public utility disclosures.

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