----

----

| Nevada                                                        |   | 90-0335743                        |
|---------------------------------------------------------------|--------|-----------------------------------|
| (State or other jurisdiction ofincorporation or organization) |   | (IRS Employer Identification No.) |
|                                                          |   |                              |
| 19495 Biscayne Blvd., Suite 411Aventura, FL                   |   | 33180                             |
| (Address of principal executive offices)                      |   | (Zip Code)                        |

| Large accelerated Filer  o | o | Accelerated Filer  o         | o |
|---------------------------------|---|-----------------------------------|---|
| Non-accelerated Filer  o   | o | Smaller reporting company  x | x |

----

----

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| PART I – FINANCIAL INFORMATION |                                                                                                                                                                                     |   |   |
|-------------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|
|                                      |                                                                                                                                                                                     |   |   |   |
| Item 1.                                   | Financial Statements                                                                                                                                                                     |   |   | 3 |   |
|                                      | Consolidated Balance Sheets as of September 30, 2012 (unaudited) and December 31, 2011                                                                                                   |   |   | 3 |   |
|                                      | Consolidated Statements of Operations for the Three and Nine months Ended September 30, 2012 and 2011 and for the period December 31, 2007 (Inception) to September 30, 2012 (unaudited) |   |   | 4 |   |
|                                      | Consolidated Statements of Cash Flows for the Nine months Ended September 30, 2012 and 2011 and for the period December 31, 2007 (Inception) to September 30, 2012 (unaudited)           |   |   | 5 |   |
|                                      | Notes to Consolidated Financial Statements (unaudited)                                                                                                                                   |   |   | 7 |   |
| Item 2.                                   | Management’s Discussion and Analysis of Financial Condition and Results of Operations                                                                                              |   |   | 35 |   |
| Item 3                                    | Quantitative and Qualitative Disclosures About Market Risk                                                                                                                               |   |   | 38 |   |
| Item 4.                                   | Controls and Procedures                                                                                                                                                                  |   |   | 39 |   |
|                                      |                                                                                                                                                                                     |   |   |   |   |
| PART II – OTHER INFORMATION    |                                                                                                                                                                                     |   |   |   |
|                                      |                                                                                                                                                                                     |   |   |   |   |
| Item 1.                                   | Legal Proceedings                                                                                                                                                                        |   |   | 40 |   |
| Item 1.A.                                 | Risk Factors                                                                                                                                                                             |   |   | 40 |   |
| Item 2.                                   | Unregistered Sales of Equity Securities and Use of Proceeds                                                                                                                              |   |   | 40 |   |
| Item 3.                                   | Defaults Upon Senior Securities                                                                                                                                                          |   |   | 42 |   |
| Item 4.                                   | Mine Safety Disclosures                                                                                                                                                                  |   |   | 42 |   |
| Item 5.                                   | Other Information                                                                                                                                                                        |   |   | 42 |   |
| Item 6.                                   | Exhibits                                                                                                                                                                                 |   |   | 43 |   |
|                                      |                                                                                                                                                                                     |   |   |   |   |
| SIGNATURES                                |                                                                                                                                                                                     |   |   | 44 |   |

----

| ONTECO CORPORATION AND SUBSIDIARY |
|-----------------------------------|
| (A Development Stage Company)     |
| Consolidated Balance Sheets       |

|                                                                            |   | September 30, |       |   | December 31, |   |
|---------------------------------------------------------------------------------|--------|---------------|------------|--------|--------------|--------|
|                                                                            |   | 2012          |       |   | 2011         |   |
|                                                                            |   | (unaudited)   |       |   |         |   |
|                                                                            |   |          |       |   |         |   |
| ASSETS                                                                          |   |
|                                                                            |   |          |       |   |         |   |
| Current assets:                                                                 |   |          |       |   |         |   |
| Cash in banks                                                                   |   | $             | -          |   |         | $      | 676 |   |
| Due from NexPhase Lighting                                                      |   |          | 659,220    |   |         |   | 405,528 |   |
| Assets attributable to discontinued operations                                  |   |          | 6,043,458  |   |         |   | 3,209,574 |   |
|                                                                            |   |          |       |   |         |   |   |   |
| Total current assets                                                            |   |          | 6,702,678  |   |         |   | 3,615,778 |   |
|                                                                            |   |          |       |   |         |   |   |   |
| Fixed assets:                                                                   |   |          |       |   |         |   |   |   |
| Property and equipment, net                                                     |   |          | 4,890      |   |         |   | 5,865 |   |
|                                                                            |   |          |       |   |         |   |   |   |
| Other assets:                                                                   |   |          |       |   |         |   |   |   |
| Security deposits                                                               |   |          | 7,589      |   |         |   | 7,589 |   |
| Deposit on acquisition                                                          |   |          | 105,000    |   |         |   | - |   |
|                                                                            |   |          |       |   |         |   |   |   |
| Total other assets                                                              |   |          | 112,589    |   |         |   | 7,589 |   |
|                                                                            |   |          |       |   |         |   |   |   |
| Total assets                                                                    |   | $             | 6,820,157  |   |         | $      | 3,629,232 |   |
|                                                                            |   |          |       |   |         |   |   |   |
| LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)                                  |   |
|                                                                            |   |          |       |   |         |   |   |   |
| Current liabilities:                                                            |   |          |       |   |         |   |   |   |
| Bank overdraft                                                                  |   | $             | 4,721      |   |         | $      | - |   |
| Accounts payable                                                                |   |          | 12,815     |   |         |   | - |   |
| Accrued interest                                                                |   |          | 62,657     |   |         |   | 26,767 |   |
| Accrued employee compensation                                                   |   |          | -          |   |         |   | 538,000 |   |
| Advances from non-affiliated related parties                                    |   |          | 35,490     |   |         |   | 1,100 |   |
| Notes payable, non-affiliated related parties                                   |   |          | 562,798    |   |         |   | 330,206 |   |
| Notes payable, third parties                                                    |   |          | 274,486    |   |         |   | 229,545 |   |
| Liabilities attributable to discontinued operations                             |   |          | 3,679,880  |   |         |   | 801,110 |   |
| Total current liabilities                                                       |   |          | 4,632,847  |   |         |   | 1,926,728 |   |
|                                                                            |   |          |       |   |         |   |   |   |
| Other liabilities                                                               |   |          | -          |   |         |   | - |   |
|                                                                            |   |          |       |   |         |   |   |   |
| Total liabilities                                                               |   |          | 4,632,847  |   |         |   | 1,926,728 |   |
|                                                                            |   |          |       |   |         |   |   |   |
| Commitments and contingencies (Note 10)                                         |   |          | -          |   |         |   | - |   |
|                                                                            |   |          |       |   |         |   |   |   |
| Stockholders' equity (deficit):                                                 |   |          |       |   |         |   |   |   |
| Preferred stock $.001 par value 10,000,000 and 100,000,000 shares authorized    |   |          |       |   |         |   |   |   |
| Series A preferred stock, 150,000 shares issued and outstanding                 |   |          |       |   |         |   |   |   |
| at September 30, 2012 and December 31, 2011, respectively                       |   |          | 150        |   |         |   | 150 |   |
| Series B preferred stock, nil shares issued and outstanding                     |   |          |       |   |         |   |   |   |
| at September 30, 2012 and December 31, 2011, respectively                       |   |          | -          |   |         |   | - |   |
| Common stock $.001 par value 5,000,000,000 and 2,000,000,000 shares authorized, |   |          |       |   |         |   |   |   |
| 648,391,560 and 923,444 shares issued and 648,391,316 and 923,200               |   |          |       |   |         |   |   |   |
| shares outstanding at September 30, 2012 and December 31, 2011, respectively    |   |          | 648,391    |   |         |   | 923 |   |
| Additional paid-in capital                                                      |   |          | 6,094,884  |   |         |   | 4,353,363 |   |
| Treasury stock, at cost (244 shares)                                            |   |          | (61,000    | )      |         |   | (61,000 | ) |
| Deficit accumulated during the development stage                                |   |          | (4,495,115 | )      |         |   | (2,590,932 | ) |
| Total stockholders' equity (deficit)                                            |   |          | 2,187,310  |   |         |   | 1,702,504 |   |
|                                                                            |   |          |       |   |         |   |   |   |
| Total liabilities and stockholders' equity (deficit)                            |   | $             | 6,820,157  |   |         | $      | 3,629,232 |   |

----

|                                                             |   |                       |        |   |                      |   |     |           |   |   |          |   |   | For the Period    |     |
|------------------------------------------------------------------|--------|----------------------------|-------------|--------|---------------------------|--------|----------|----------------|--------|--------|---------------|--------|--------|-------------------|----------|
|                                                             |   |                       |        |   |                      |   |     |           |   |   |          |   |   | December 31, 2007 |     |
|                                                             |   | For the Three Months Ended |        |   | For the Nine Months Ended |   |     | (Inception) to |   |
|                                                             |   | September 30,              |        |   | September 30,             |   |     | September 30,  |   |   | September 30, |   |   | September 30,     |     |
|                                                             |   | 2012                       |        |   | 2011                      |   |     | 2012           |   |   | 2011          |   |   | 2012              |     |
|                                                             |   |                       |        |   |                      |   |     |           |   |   |          |   |   |              |     |
| Revenue                                                          |   | $                          | -           |   |                      | $      | -        |           |   | $      | -             |   |   | $                 | -        |   |   | $ | - |   |
|                                                             |   |                       |        |   |                      |   |     |           |   |   |          |   |   |              |     |   |   |   |   |   |
| Cost of goods sold                                               |   |                       | -           |   |                      |   | -        |           |   |   | -             |   |   |              | -        |   |   |   | - |   |
|                                                             |   |                       |        |   |                      |   |     |           |   |   |          |   |   |              |     |   |   |   |   |   |
| Gross profit                                                     |   |                       | -           |   |                      |   | -        |           |   |   | -             |   |   |              | -        |   |   |   | - |   |
|                                                             |   |                       |        |   |                      |   |     |           |   |   |          |   |   |              |     |   |   |   |   |   |
| Operating expenses:                                              |   |                       |        |   |                      |   |     |           |   |   |          |   |   |              |     |   |   |   |   |   |
| General and administrative                                       |   |                       | 21,276      |   |                      |   | 19,793   |           |   |   | 59,424        |   |   |              | 42,337   |   |   |   | 276,210 |   |
| Investor relations                                               |   |                       | -           |   |                      |   | 6,060    |           |   |   | -             |   |   |              | 124,072  |   |   |   | 124,072 |   |
| Occupancy - Headquarters                                         |   |                       | 12,691      |   |                      |   | 12,428   |           |   |   | 39,251        |   |   |              | 33,140   |   |   |   | 90,121 |   |
| Officer compensation                                             |   |                       | (90,000     | )      |                      |   | 45,000   |           |   |   | -             |   |   |              | 135,000  |   |   |   | 455,000 |   |
| Professional fees                                                |   |                       | 33,142      |   |                      |   | 54,290   |           |   |   | 80,144        |   |   |              | 83,224   |   |   |   | 215,236 |   |
| Staff compensation                                               |   |                       | 48,361      |   |                      |   | 11,496   |           |   |   | 70,372        |   |   |              | 38,766   |   |   |   | 239,953 |   |
| Stock-based compensation                                         |   |                       | 25,000      |   |                      |   | -        |           |   |   | 25,000        |   |   |              | -        |   |   |   | 430,205 |   |
| Depreciation                                                     |   |                       | 325         |   |                      |   | 325      |           |   |   | 975           |   |   |              | 975      |   |   |   | 2,275 |   |
| Total operating expenses                                         |   |                       | 50,795      |   |                      |   | 149,392  |           |   |   | 275,166       |   |   |              | 457,514  |   |   |   | 1,833,072 |   |
|                                                             |   |                       |        |   |                      |   |     |           |   |   |          |   |   |              |     |   |   |   |   |   |
| Loss from operations                                             |   |                       | (50,795     | )      |                      |   | (149,392 | )              |   |   | (275,166      | )      |   |              | (457,514 | ) |   |   | (1,833,072 | ) |
|                                                             |   |                       |        |   |                      |   |     |           |   |   |          |   |   |              |     |   |   |   |   |   |
| Other expenses:                                                  |   |                       |        |   |                      |   |     |           |   |   |          |   |   |              |     |   |   |   |   |   |
| Loss on dispotion of assets                                      |   |                       | -           |   |                      |   | -        |           |   |   | -             |   |   |              | -        |   |   |   | 567 |   |
| Loss on settlement of debt (Note 11)                             |   |                       | 73,702      |   |                      |   | -        |           |   |   | 711,702       |   |   |              | -        |   |   |   | 711,702 |   |
| Interest expense                                                 |   |                       | 565,351     |   |                      |   | 10,927   |           |   |   | 862,430       |   |   |              | 45,786   |   |   |   | 1,327,265 |   |
| Write-off of project development costs                           |   |                       | -           |   |                      |   | -        |           |   |   | -             |   |   |              | 27,600   |   |   |   | 27,600 |   |
| Write-off of amount due from other                               |   |                       | -           |   |                      |   | -        |           |   |   | -             |   |   |              | -        |   |   |   | 1,000 |   |
| Total other expenses                                             |   |                       | 639,053     |   |                      |   | 10,927   |           |   |   | 1,574,132     |   |   |              | 73,386   |   |   |   | 2,068,134 |   |
|                                                             |   |                       |        |   |                      |   |     |           |   |   |          |   |   |              |     |   |   |   |   |   |
| Net loss from continuing operations                              |   |                       | (689,848    | )      |                      |   | (160,319 | )              |   |   | (1,849,298    | )      |   |              | (530,900 | ) |   |   | (3,901,206 | ) |
|                                                             |   |                       |        |   |                      |   |     |           |   |   |          |   |   |              |     |   |   |   |   |   |
| Net loss from discontinued operations                            |   |                       | 80,222      |   |                      |   | 18,200   |           |   |   | (54,885       | )      |   |              | (196,748 | ) |   |   | (593,909 | ) |
|                                                             |   |                       |        |   |                      |   |     |           |   |   |          |   |   |              |     |   |   |   |   |   |
| Net loss                                                         |   | $                          | (609,626    | )      |                      | $      | (142,119 | )              |   | $      | (1,904,183    | )      |   | $                 | (727,648 | ) |   | $ | (4,495,115 | ) |
|                                                             |   |                       |        |   |                      |   |     |           |   |   |          |   |   |              |     |   |   |   |   |   |
|                                                             |   |                       |        |   |                      |   |     |           |   |   |          |   |   |              |     |   |   |   |   |   |
| Net loss per share - Basic and diluted - continuing operations   |   | $                          | (0.00       | )      |                      | $      | (0.55    | )              |   | $      | (0.01         | )      |   | $                 | (2.40    | ) |   |   |   |   |
| Net loss per share - Basic and diluted - discontinued operations |   | $                          | 0.00        |   |                      | $      | 0.06     |           |   | $      | (0.00         | )      |   | $                 | (0.89    | ) |   |   |   |   |
| Net loss per share - Basic and diluted                           |   | $                          | (0.00       | )      |                      | $      | (0.49    | )              |   | $      | (0.01         | )      |   | $                 | (3.29    | ) |   |   |   |   |
|                                                             |   |                       |        |   |                      |   |     |           |   |   |          |   |   |              |     |   |   |   |   |   |
| Weighted average number of shares                                |   |                       |        |   |                      |   |     |           |   |   |          |   |   |              |     |   |   |   |   |   |
| oustanding during the period -                                   |   |                       |        |   |                      |   |     |           |   |   |          |   |   |              |     |   |   |   |   |   |
| Basic and diluted                                                |   |                       | 302,575,501 |   |                      |   | 291,980  |           |   |   | 162,231,875   |   |   |              | 221,345  |   |   |   |   |   |

----

| ONTECO CORPORATION AND SUBSIDIARY     |
|---------------------------------------|
| (A Development Stage Company)         |
| Consolidated Statements of Cash Flows |
| (unaudited)                           |

|                                                                   |   |                      |       |   |           |   |     | For the Period    |   |
|------------------------------------------------------------------------|--------|---------------------------|------------|--------|----------------|--------|----------|-------------------|--------|
|                                                                   |   |                      |       |   |           |   |     | December 31, 2007 |   |
|                                                                   |   | For the Nine Months Ended |       |   | (Inception) to |   |
|                                                                   |   | September 30,             |       |   | September 30,  |   |     | September 30,     |   |
|                                                                   |   | 2012                      |       |   | 2011           |   |     | 2012              |   |
|                                                                   |   |                      |       |   |           |   |     |              |   |
| Cash flows used in operating activities:                               |   |                      |       |   |           |   |     |              |   |
| Net loss                                                               |   | $                         | (1,904,183 | )      |           | $      | (727,648 | )                 |   | $ | (4,495,115 | ) |
| Adjustments to reconcile net loss to net cash used in operations:      |   |                      |       |   |           |   |     |              |   |   |   |   |
| License fee revenue realized                                           |   |                      | -          |   |           |   | -        |              |   |   | - |   |
| Depreciation                                                           |   |                      | 975        |   |           |   | 975      |              |   |   | 2,275 |   |
| Loss on settlement of debt                                             |   |                      | 711,702    |   |           |   | -        |              |   |   | 711,702 |   |
| Stock-based compensation                                               |   |                      | 25,000     |   |           |   | -        |              |   |   | 195,055 |   |
| Stock issued for services                                              |   |                      | -          |   |           |   | 80,685   |              |   |   | 315,834 |   |
| Cancellation of stock issued for services                              |   |                      | -          |   |           |   | (84,000  | )                 |   |   | (84,000 | ) |
| Write-off of project development costs                                 |   |                      | -          |   |           |   | 27,600   |              |   |   | 27,600 |   |
| Loss on disposition of software                                        |   |                      | -          |   |           |   | -        |              |   |   | 567 |   |
| Interest accrued on notes payable, non-affiliated related parties      |   |                      | 52,582     |   |           |   | 62,295   |              |   |   | 149,337 |   |
| Interest accrued on notes payable, third parties                       |   |                      | 17,138     |   |           |   | 12,105   |              |   |   | 29,490 |   |
| Accretion of beneficial conversion feature as interest expense         |   |                      | 770,023    |   |           |   | -        |              |   |   | 1,307,692 |   |
| Changes in operating assets and liabilities:                           |   |                      |       |   |           |   |     |              |   |   |   |   |
| Due from NexPhase Lighting                                             |   |                      | (66,060    | )      |           |   | (129,804 | )                 |   |   | (133,984 | ) |
| Assets attributable to discontinued operations                         |   |                      | (2,833,884 | )      |           |   | -        |              |   |   | (2,833,884 | ) |
| Bank overdraft                                                         |   |                      | 4,721      |   |           |   | -        |              |   |   | 4,721 |   |
| Accounts payable                                                       |   |                      | 12,815     |   |           |   | -        |              |   |   | 12,815 |   |
| Sales tax payable                                                      |   |                      | -          |   |           |   | -        |              |   |   | - |   |
| Accrued compensation                                                   |   |                      | -          |   |           |   | 135,000  |              |   |   | 538,000 |   |
| Liabilities attributable to discontinued operations                    |   |                      | 2,878,770  |   |           |   | -        |              |   |   | 2,878,770 |   |
| Net cash used in operating activities                                  |   |                      | (330,401   | )      |           |   | (622,792 | )                 |   |   | (1,373,125 | ) |
|                                                                   |   |                      |       |   |           |   |     |              |   |   |   |   |
| Cash flows used in investing activities:                               |   |                      |       |   |           |   |     |              |   |   |   |   |
| Purchase of property and equipment                                     |   |                      | -          |   |           |   | -        |              |   |   | (567 | ) |
| Project development costs                                              |   |                      | -          |   |           |   | -        |              |   |   | (27,600 | ) |
| Net cash used in investing activities                                  |   |                      | -          |   |           |   | -        |              |   |   | (28,167 | ) |
|                                                                   |   |                      |       |   |           |   |     |              |   |   |   |   |
| Cash flows from financing activities:                                  |   |                      |       |   |           |   |     |              |   |   |   |   |
| Proceeds from issuance of note payable, non-affiliated related parties |   |                      | 73,650     |   |           |   | 400,450  |              |   |   | 837,105 |   |
| Payments on notes payable, non-affiliated related parties              |   |                      | (34,000    | )      |           |   | (14,905  | )                 |   |   | (60,655 | ) |
| Proceeds from issuance of notes payable, third parties                 |   |                      | 308,000    |   |           |   | 259,000  |              |   |   | 636,100 |   |
| Payments on notes payable, third parties                               |   |                      | (52,315    | )      |           |   | -        |              |   |   | (52,315 | ) |
| Advances from non-affiliated related parties, net                      |   |                      | 34,390     |   |           |   | -        |              |   |   | 35,490 |   |
| Proceeds from sale of common stock                                     |   |                      | -          |   |           |   | -        |              |   |   | 5,567 |   |
| Net cash provided by financing activities                              |   |                      | 329,725    |   |           |   | 644,545  |              |   |   | 1,401,292 |   |
|                                                                   |   |                      |       |   |           |   |     |              |   |   |   |   |
| Net increase (decrease) in cash                                        |   |                      | (676       | )      |           |   | 21,753   |              |   |   | - |   |
|                                                                   |   |                      |       |   |           |   |     |              |   |   |   |   |
| Cash at beginning of period                                            |   |                      | 676        |   |           |   | 62,428   |              |   |   | - |   |
|                                                                   |   |                      |       |   |           |   |     |              |   |   |   |   |
| Cash at end of period                                                  |   | $                         | -          |   |           | $      | 84,181   |              |   | $ | - |   |

----

| ONTECO CORPORATION AND SUBSIDIARY    |
|--------------------------------------|
| (A Development Stage Company)        |
| Statements of Cash Flows (Continued) |
| (unaudited)                          |

|                                                                                   |   |                      |      |   |                  |   |     | For the Period    |   |
|----------------------------------------------------------------------------------------|--------|---------------------------|-----------|--------|-----------------------|--------|----------|-------------------|--------|
|                                                                                   |   |                      |      |   |                  |   |     | December 31, 2007 |   |
|                                                                                   |   |                      |      |   |                  |   |     | (Inception of     |   |
|                                                                                   |   | For the Nine Months Ended |      |   | Exploration Stage) to |   |
|                                                                                   |   | September 30,             |      |   | September 30,         |   |     | September 30,     |   |
|                                                                                   |   | 2012                      |      |   | 2011                  |   |     | 2012              |   |
|                                                                                   |   |                      |      |   |                  |   |     |              |   |
| Supplemental disclosure of cash flow information:                                      |   |                      |      |   |                  |   |     |              |   |
|                                                                                   |   |                      |      |   |                  |   |     |              |   |
| Cash paid for interest                                                                 |   | $                         | -         |   |                  | $      | -        |              |   | $ | - |   |
|                                                                                   |   |                      |      |   |                  |   |     |              |   |   |   |   |
| Cash paid for taxes                                                                    |   | $                         | -         |   |                  | $      | -        |              |   | $ | - |   |
|                                                                                   |   |                      |      |   |                  |   |     |              |   |   |   |   |
| Non-cash investing and financing activities:                                           |   |                      |      |   |                  |   |     |              |   |   |   |   |
|                                                                                   |   |                      |      |   |                  |   |     |              |   |   |   |   |
| Conversion of note payable, related parties to common stock                            |   | $                         | (204,150  | )      |                  | $      | -        |              |   | $ | (358,366 | ) |
| Conversion of accrued interest, related parties to common stock                        |   |                      | (5,480    | )      |                  |   |     |              |   |   | (23,480 | ) |
| Common stock issued                                                                    |   |                      | 52,043    |   |                  |   | -        |              |   |   | 67,591 |   |
| Additional paid in capital on stock issued                                             |   |                      | 157,587   |   |                  |   | -        |              |   |   | 314,255 |   |
|                                                                                   |   |                      |      |   |                  |   |     |              |   |   |   |   |
| Conversion of note payable, third parties to common stock                              |   |                      | (207,140  | )      |                  |   | -        |              |   |   | (466,064 | ) |
| Conversion of accrued interest, third parties to common stock                          |   |                      | (10,385   | )      |                  |   | -        |              |   |   | (15,785 | ) |
| Common stock issued                                                                    |   |                      | 156,338   |   |                  |   | -        |              |   |   | 156,819 |   |
| Additional paid in capital on stock issued                                             |   |                      | 61,187    |   |                  |   | -        |              |   |   | 325,030 |   |
|                                                                                   |   |                      |      |   |                  |   |     |              |   |   |   |   |
| Benefical conversion feature discount to notes payable, related parties                |   |                      | (575,066  | )      |                  |   | -        |              |   |   | (1,054,389 | ) |
| Benefical conversion feature discount to notes payable, third parties                  |   |                      | (435,123  | )      |                  |   | -        |              |   |   | (766,240 | ) |
| Additional paid in capital                                                             |   |                      | 1,010,189 |   |                  |   | -        |              |   |   | 1,820,629 |   |
|                                                                                   |   |                      |      |   |                  |   |     |              |   |   |   |   |
| Conversion of accrued compensation to common stock                                     |   |                      | (50,000   | )      |                  |   | -        |              |   |   | (50,000 | ) |
| Common stock issued                                                                    |   |                      | 50,000    |   |                  |   | -        |              |   |   | 50,000 |   |
|                                                                                   |   |                      |      |   |                  |   |     |              |   |   |   |   |
| Deposit on acquisition                                                                 |   |                      | (105,000  | )      |                  |   | -        |              |   |   | (105,000 | ) |
| Common stock issued                                                                    |   |                      | 150,000   |   |                  |   | -        |              |   |   | 150,000 |   |
| Additional paid in capital on stock issued                                             |   |                      | (45,000   | )      |                  |   | -        |              |   |   | (45,000 | ) |
|                                                                                   |   |                      |      |   |                  |   |     |              |   |   |   |   |
| Conversion of accrued compensation to notes payable, related parties:                  |   |                      |      |   |                  |   |     |              |   |
| Notes payable, related parties                                                         |   |                      | 501,425   |   |                  |   | -        |              |   |   | 501,425 |   |
| Accrued compensation                                                                   |   |                      | (501,425  | )      |                  |   | -        |              |   |   | (501,425 | ) |
|                                                                                   |   |                      |      |   |                  |   |     |              |   |   |   |   |
| Conversion of NexPhase notes payable, related parties to notes payable, third parties: |   |                      |      |   |                  |   |     |              |   |
| Due from NexPhase                                                                      |   |                      | (75,674   | )      |                  |   | -        |              |   |   | (75,674 | ) |
| Notes payable, third parties                                                           |   |                      | 75,674    |   |                  |   | -        |              |   |   | 75,674 |   |
|                                                                                   |   |                      |      |   |                  |   |     |              |   |   |   |   |
| Conversion of NexPhase notes payable, related parties to common stock:                 |   |                      |      |   |                  |   |     |              |   |
| Due from NexPhase                                                                      |   |                      | (111,958  | )      |                  |   | -        |              |   |   | (111,958 | ) |
| Common stock                                                                           |   |                      | 189,087   |   |                  |   | -        |              |   |   | 189,087 |   |
| Additional paid in capital on stock issued                                             |   |                      | (77,129   | )      |                  |   | -        |              |   |   | (77,129 | ) |
|                                                                                   |   |                      |      |   |                  |   |     |              |   |   |   |   |
| Conversion of notes payable, related parties to notes payable, third parties:          |   |                      |      |   |                  |   |     |              |   |
| Notes payable, related parties                                                         |   |                      | (36,580   | )      |                  |   | (118,000 | )                 |   |   | (254,672 | ) |
| Accrued interest                                                                       |   |                      | (2,225    | )      |                  |   | -        |              |   |   | (28,247 | ) |
| Notes payable, third parties                                                           |   |                      | 38,805    |   |                  |   | 118,000  |              |   |   | 282,919 |   |
|                                                                                   |   |                      |      |   |                  |   |     |              |   |   |   |   |
| Net assets acquired in acquisition of NexPhase Lighting                                |   |                      | -         |   |                  |   | -        |              |   |   | (2,700,000 | ) |
| Common stock issued                                                                    |   |                      | -         |   |                  |   | -        |              |   |   | 67,500 |   |
| Additional paid in capital on stock issued                                             |   |                      | -         |   |                  |   | -        |              |   |   | 2,632,500 |   |
|                                                                                   |   |                      |      |   |                  |   |     |              |   |   |   |   |
| 244,000 shares of stock acquired and placed in treasury                                |   |                      | -         |   |                  |   | (61,000  | )                 |   |   | (61,000 | ) |
| Issuance of notes payable to former investors in NexPhase                              |   |                      | -         |   |                  |   | 61,000   |              |   |   | 61,000 |   |

----

----

----

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | September 30, 2012 |   |   | December 31, 2011 |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------|--------|--------|-------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |               |   |   |              |   |   | Principal, |   |   |   |   |   |   |   |   | Principal, |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |               |   |   | Unamortized       |   |   | net of |   |   |   |   |   | Unamortized |   |   | net of |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | Principal          |   |   | Discount          |   |   | Discounts |   |   | Principal |   |   | Discount |   |   | Discounts |   |
| Notes Payable -- Related Parties - Onteco                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On February 10, 2010 the Company entered into a convertible promissory note with a web designer for services rendered in the amount of $3,150. Terms include bonus interest of $315, the note is payable on demand and has no stated interest rate or due date. On January 3, 2011 the parties amended the terms and conditions of the promissory note as follows: On January 5, 2011, the note was assigned from the web designer to a non-affiliated related party investment firm.  The “Note Conversion Price” shall be adjusted from $0.03 to the par value of the common stock, or $0.001 per share representing 3,465,000 unregistered common shares. No payments have been made on this note. On February 25, 2011 a portion of the note in the amount of $1,316 was converted to Common Stock.  The note is currently in default. |   | $                  | 2,149  |   |              | $      | - |   |   | $ | 2,149 |   |   | $ | 2,149 |   |   | $ | - |   |   | $ | 2,149 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On June 7, 2010 the Company entered into a convertible promissory note with an investor in the amount of $5,000. The note is payable on demand, has no stated interest rate or due date and is convertible at a rate of $0.03. No payments have been made on this note.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |               | 5,000  |   |              |   | - |   |   |   | 5,000 |   |   |   | 5,000 |   |   |   | - |   |   |   | 5,000 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On August 9, 2010 the Company entered into a convertible promissory note with an investor in the amount of $5,000. The note is payable on demand, has no stated interest rate or due date and is convertible at a rate of $0.001. No payments have been made on this note. During the nine months ended September 30, 2012, a portion of the note in the amount of $5,000 was converted to Common Stock.                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |               | -      |   |              |   | - |   |   |   | - |   |   |   | 5,000 |   |   |   | - |   |   |   | 5,000 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On August 25, 2010 the Company entered into a convertible promissory note with an investor in the amount of $4,000. The note is payable on demand, has no stated interest rate or due date and is convertible at a rate of $0.001. No payments have been made on this note.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |               | 4,000  |   |              |   | - |   |   |   | 4,000 |   |   |   | 4,000 |   |   |   | - |   |   |   | 4,000 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On September 2, 2010 the Company entered into a convertible promissory note with an investor in the amount of $20,000. The note is payable on demand, has no stated interest rate or due date and is convertible at a rate of $0.001 per share. No payments have been made on this note. During the nine months ended September 30, 2012, the note in the amount of $20,000 was converted to Common Stock.                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |               | -      |   |              |   | - |   |   |   | - |   |   |   | 20,000 |   |   |   | - |   |   |   | 20,000 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On October 13, 2010 the Company entered into a convertible promissory note with an investor in the amount of $3,000. The note is payable on demand, has no stated interest rate or due date and is convertible at a rate of $0.001 per share. No payments have been made on this note.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |               | 3,000  |   |              |   | - |   |   |   | 3,000 |   |   |   | 3,000 |   |   |   | - |   |   |   | 3,000 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On October 29, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $30,000. Terms include simple interest at twelve percent (12.0%), the note is due on October 29, 2011 and is convertible at the option of the holder at a price which is the greater of (i) twice the par value of the common stock, or (ii) a seventy-five percent discount to the market closing bid price on the date of the conversion notice. No payments have been made on this note.  The note is currently in default. During the nine months ended September 30, 2012, a portion of the note in the amount of $27,000 was converted to Common Stock.                                                                                                                                                                                     |   |               | 3,000  |   |              |   | - |   |   |   | 3,000 |   |   |   | 30,000 |   |   |   | - |   |   |   | 30,000 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On November 4, 2010 the Company entered into a convertible promissory note with  an investor in the amount of $19,600. The note is payable on demand, includes bonus interest of $1,600, has no due date and is convertible at a rate of $0.001 per share. No payments have been made on this note.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |               | 19,600 |   |              |   | - |   |   |   | 19,600 |   |   |   | 19,600 |   |   |   | - |   |   |   | 19,600 |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   | September 30, 2012 |   |   | December 31, 2011 |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------|--------|--------|-------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |               |   |   |              |   |   | Principal, |   |   |   |   |   |   |   |   | Principal, |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |               |   |   | Unamortized       |   |   | net of |   |   |   |   |   | Unamortized |   |   | net of |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   | Principal          |   |   | Discount          |   |   | Discounts |   |   | Principal |   |   | Discount |   |   | Discounts |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On November 8, 2010 the Company entered into a convertible promissory note with an investment firm in the amount of $5,500. Terms include bonus interest of $500, the note is payable on demand and is convertible at a rate of $0.001 per share. No payments have been made on this note. During the nine months ended September 30, 2012, the note in the amount of $5,500 was converted to Common Stock.                                                                                                                                                                                                                |   |               | -      |   |              |   | - |   |   |   | - |   |   |   | 5,500 |   |   |   | - |   |   |   | 5,500 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On November 15, 2010 the Company entered into a convertible promissory note with an investor in the amount of $28,000. The note is payable on demand, has no stated interest rate or due date and is convertible at a rate of $0.001. No payments have been made on this note. During the nine months ended September 30, 2012, the note in the amount of $28,000 was converted to Common Stock.                                                                                                                                                                                                                           |   |               | -      |   |              |   | - |   |   |   | - |   |   |   | 28,000 |   |   |   | - |   |   |   | 28,000 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On November 30, 2010 the Company entered into a convertible promissory note with an investment firm in the amount of $9,300. Terms include bonus interest of $930, the note is payable on demand and has no stated interest rate or due date and is convertible at a rate of $0.001 per share. No payments have been made on this note. During the nine months ended September 30, 2012, the note in the amount of $9,300, plus $930 of bonus interest, was converted to Common Stock.                                                                                                                                     |   |               | -      |   |              |   | - |   |   |   | - |   |   |   | 9,300 |   |   |   | - |   |   |   | 9,300 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On December 15, 2010 the Company entered into a convertible promissory note with an investment firm in the amount of $15,500. Terms include simple interest at ten percent (10.0%), the note is due on December 15, 2011 and is convertible at the option of the holder at a price which is the greater of (i) twice the par value of the common stock, or (ii) a seventy-five percent discount to the market closing bid price on the date of the conversion notice. No payments have been made on this note. The note is currently in default.                                                                                |   |               | 15,500 |   |              |   | - |   |   |   | 15,500 |   |   |   | 15,500 |   |   |   | - |   |   |   | 15,500 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On January 10, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $1,000. Terms include simple interest at ten percent (10.0%), the note is due on January 10, 2012 and is convertible at the option of the holder at a price which is the greater of (i) twice the par value of the common stock, or (ii) a seventy-five percent discount to the market closing bid price on the date of the conversion notice. No payments have been made on this note.  The note is currently in default.                                                                        |   |               | 1,000  |   |              |   | - |   |   |   | 1,000 |   |   |   | 1,000 |   |   |   | (27 | ) |   |   | 973 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On February 23, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $21,600. Terms include simple interest at ten percent (10.0%), the note is due on February 23, 2012 and is convertible at the option of the holder at a price which is the greater of (i) twice the par value of the common stock, or (ii) a seventy-five percent discount to the market closing bid price on the date of the conversion notice. No payments have been made on this note. During the six months ended June 30, 2012, the note in the amount of $21,600 was converted to Common Stock. |   |               | -      |   |              |   | - |   |   |   | - |   |   |   | 21,600 |   |   |   | (3,195 | ) |   |   | 18,405 |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   | September 30, 2012 |   |   | December 31, 2011 |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------|--------|--------|-------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |               |   |   |              |   |   | Principal, |   |   |   |   |   |   |   |   | Principal, |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |               |   |   | Unamortized       |   |   | net of |   |   |   |   |   | Unamortized |   |   | net of |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   | Principal          |   |   | Discount          |   |   | Discounts |   |   | Principal |   |   | Discount |   |   | Discounts |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On March 1, 2011 the Company entered into a convertible promissory note assigned from NexPhase in the amount of $60,000. Terms include simple interest at ten percent (10.0%), the note is due on March 1, 2012 and is convertible at the option of the holder at a price which is the greater of (i) twice the par value of the common stock, or (ii) a seventy-five percent discount to the market closing bid price on the date of the conversion notice. No payments have been made on this note. As of December 31, 2011, a portion of the note in the amount of $49,000 has been converted to Common Stock.  The note is currently in default. |   |               | 11,000 |   |              |   | - |   |   |   | 11,000 |   |   |   | 11,000 |   |   |   | (1,833 | ) |   |   | 9,167 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On March 10, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $3,000. Terms include simple interest at ten percent (10.0%), the note is due on March 10, 2012 and is convertible at the option of the holder at a price which is the greater of (i) twice the par value of the common stock, or (ii) a seventy-five percent discount to the market closing bid price on the date of the conversion notice. No payments have been made on this note.  The note is currently in default.                                                                                                                |   |               | 3,000  |   |              |   | - |   |   |   | 3,000 |   |   |   | 3,000 |   |   |   | (574 | ) |   |   | 2,426 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On March 31, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $5,500. Terms include simple interest at ten percent (10.0%), the note is due on March 31, 2012 and is convertible at the option of the holder at a price which is the greater of (i) twice the par value of the common stock, or (ii) a seventy-five percent discount to the market closing bid price on the date of the conversion notice. No payments have been made on this note. During the nine months ended September 30, 2012, the note plus $600 of accrued interest has been converted to Common Stock.                            |   |               | -      |   |              |   | - |   |   |   | - |   |   |   | 5,500 |   |   |   | (1,367 | ) |   |   | 4,133 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On March 31, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $6,500. Terms include simple interest at ten percent (10.0%), the note is due on March 31, 2012 and is convertible at the option of the holder at a price which is the greater of (i) twice the par value of the common stock, or (ii) a seventy-five percent discount to the market closing bid price on the date of the conversion notice. During the nine months ended September 30, 2012, a portion of the note in the amount of $5,500 has been converted to Common Stock.  The note is currently in default.                 |   |               | 1,000  |   |              |   | - |   |   |   | 1,000 |   |   |   | 6,500 |   |   |   | (1,616 | ) |   |   | 4,884 |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   | September 30, 2012 |   |   | December 31, 2011 |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------|--------|--------|-------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |               |   |   |              |   |   | Principal, |   |   |   |   |   |   |   |   | Principal, |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |               |   |   | Unamortized       |   |   | net of |   |   |   |   |   | Unamortized |   |   | net of |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   | Principal          |   |   | Discount          |   |   | Discounts |   |   | Principal |   |   | Discount |   |   | Discounts |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On April 14, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $17,500. Terms include simple interest at ten percent (10.0%), the note is due on April 14, 2012 and is convertible at the option of the holder at a price which is the greater of (i) twice the par value of the common stock, or (ii) a seventy-five percent discount to the market closing bid price on the date of the conversion notice. No payments have been made on this note. During the nine months ended September 30, 2012, a portion of the note in the amount of $11,000 was converted to Common Stock.  The note is currently in default. |   |               | 6,500  |   |              |   | - |   |   |   | 6,500 |   |   |   | 17,500 |   |   |   | (5,020 | ) |   |   | 12,480 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On April 15, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $27,000. Terms include simple interest at ten percent (10.0%), the note is due on April 15, 2012 and is convertible at the option of the holder at a price which is the greater of (i) twice the par value of the common stock, or (ii) a seventy-five percent discount to the market closing bid price on the date of the conversion notice. No payments have been made on this note. During the nine months ended September 30, 2012, a portion of the note in the amount of $25,000 was converted to Common Stock.  The note is currently in default. |   |               | 2,000  |   |              |   | - |   |   |   | 2,000 |   |   |   | 27,000 |   |   |   | (7,819 | ) |   |   | 19,181 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On April 18, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $1,000. Terms include simple interest at ten percent (10.0%), the note is due on April 18, 2012 and is convertible at the option of the holder at a price which is the greater of (i) twice the par value of the common stock, or (ii) a seventy-five percent discount to the market closing bid price on the date of the conversion notice. No payments have been made on this note. During the nine months ended September 30, 2012, the note in the amount of $1,000 was converted to Common Stock. The note is currently in default.                           |   |               | -      |   |              |   | - |   |   |   | - |   |   |   | 1,000 |   |   |   | (298 | ) |   |   | 702 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On April 18, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $2,000. Terms include simple interest at ten percent (10.0%), the note is due on April 18, 2012 and is convertible at the option of the holder at a price which is the greater of (i) twice the par value of the common stock, or (ii) a seventy-five percent discount to the market closing bid price on the date of the conversion notice. No payments have been made on this note.  The note is currently in default.                                                                                                                                      |   |               | 2,000  |   |              |   | - |   |   |   | 2,000 |   |   |   | 2,000 |   |   |   | (595 | ) |   |   | 1,405 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On April 21, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $5,000. Terms include simple interest at ten percent (10.0%), the note is due on April 21, 2012 and is convertible at the option of the holder at a price which is the greater of (i) twice the par value of the common stock, or (ii) a seventy-five percent discount to the market closing bid price on the date of the conversion notice. No payments have been made on this note.  The note is currently in default.                                                                                                                                      |   |               | 5,000  |   |              |   | - |   |   |   | 5,000 |   |   |   | 5,000 |   |   |   | (1,530 | ) |   |   | 3,470 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On April 27, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $2,500. Terms include simple interest at ten percent (10.0%), the note is due on April 27, 2012 and is convertible at the option of the holder at a price which is the greater of (i) twice the par value of the common stock, or (ii) a seventy-five percent discount to the market closing bid price on the date of the conversion notice. No payments have been made on this note.  The note is currently in default.                                                                                                                                      |   |               | 2,500  |   |              |   | - |   |   |   | 2,500 |   |   |   | 2,500 |   |   |   | (806 | ) |   |   | 1,694 |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   | September 30, 2012 |   |   | December 31, 2011 |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------|--------|--------|-------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |               |   |   |              |   |   | Principal, |   |   |   |   |   |   |   |   | Principal, |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |               |   |   | Unamortized       |   |   | net of |   |   |   |   |   | Unamortized |   |   | net of |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   | Principal          |   |   | Discount          |   |   | Discounts |   |   | Principal |   |   | Discount |   |   | Discounts |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On April 28, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $2,500. Terms include simple interest at ten percent (10.0%), the note is due on April 28, 2012 and is convertible at the option of the holder at a price which is the greater of (i) twice the par value of the common stock, or (ii) a seventy-five percent discount to the market closing bid price on the date of the conversion notice. No payments have been made on this note.  The note is currently in default.                                                                                                                                                               |   |               | 2,500  |   |              |   | - |   |   |   | 2,500 |   |   |   | 2,500 |   |   |   | (813 | ) |   |   | 1,687 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On May 16, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $15,000. Terms include simple interest at ten percent (10.0%), the note is due on May 16, 2012 and is convertible at the option of the holder at a price which is the greater of (i) twice the par value of the common stock, or (ii) a seventy-five percent discount to the market closing bid price on the date of the conversion notice. No payments have been made on this note.  The note is currently in default.                                                                                                                                                                  |   |               | 15,000 |   |              |   | - |   |   |   | 15,000 |   |   |   | 15,000 |   |   |   | (5,614 | ) |   |   | 9,386 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On June 1, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $3,000. Terms include simple interest at ten percent (10.0%), the note is due on June 1, 2012 and is convertible at the option of the holder at a price which is the greater of (i) twice the par value of the common stock, or (ii) a seventy-five percent discount to the market closing bid price on the date of the conversion notice. No payments have been made on this note.  The note is currently in default.                                                                                                                                                                   |   |               | 3,000  |   |              |   | - |   |   |   | 3,000 |   |   |   | 3,000 |   |   |   | (1,254 | ) |   |   | 1,746 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On June 10, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $3,000. Terms include simple interest at ten percent (10.0%), the note is due on June 10, 2012 and is convertible at the option of the holder at a price which is the greater of (i) twice the par value of the common stock, or (ii) a seventy-five percent discount to the market closing bid price on the date of the conversion notice. No payments have been made on this note.  The note is currently in default.                                                                                                                                                                 |   |               | 3,000  |   |              |   | - |   |   |   | 3,000 |   |   |   | 3,000 |   |   |   | (1,327 | ) |   |   | 1,673 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On June 20, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $6,500. Terms include simple interest at ten percent (10.0%), the note is due on June 20, 2012 and is convertible at the option of the holder at a price which is the greater of (i) twice the par value of the common stock, or (ii) a seventy-five percent discount to the market closing bid price on the date of the conversion notice. No payments have been made on this note. During the nine months ended September 30, 2012, the note balance of $6,500, plus accrued interest of $671, was converted to Common Stock.                                                              |   |               | -      |   |              |   | - |   |   |   | - |   |   |   | 6,500 |   |   |   | (3,054 | ) |   |   | 3,446 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On June 24, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $2,000. Terms include simple interest at ten percent (10.0%), the note is due on June 24, 2012 and is convertible at the option of the holder at a price which is the greater of (i) twice the par value of the common stock, or (ii) a seventy-five percent discount to the market closing bid price on the date of the conversion notice. No payments have been made on this note.  The note is currently in default. During the nine months ended September 30, 2012, a portion of the note in the amount of $250, plus accrued interest of $11, was converted to Common Stock. |   |               | 1,750  |   |              |   | - |   |   |   | 1,750 |   |   |   | 2,000 |   |   |   | (961 | ) |   |   | 1,039 |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   | September 30, 2012 |   |   | December 31, 2011 |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------|--------|--------|-------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |               |   |   |              |   |   | Principal, |   |   |   |   |   |   |   |   | Principal, |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |               |   |   | Unamortized       |   |   | net of |   |   |   |   |   | Unamortized |   |   | net of |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   | Principal          |   |   | Discount          |   |   | Discounts |   |   | Principal |   |   | Discount |   |   | Discounts |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On August 4, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $15,000. Terms include simple interest at ten percent (10.0%), the note is due on August 4, 2012 and is convertible at the option of the holder at a price of $0.001 per share. No payments have been made on this note. During the nine months ended September 30, 2012, the note balance of $15,000, plus accrued interest of $868, was converted to Common Stock. |   |               | -      |   |              |   | - |   |   |   | - |   |   |   | 15,000 |   |   |   | (8,893 | ) |   |   | 6,107 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On August 4, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $20,000. Terms include simple interest at ten percent (10.0%), the note is due on August 4, 2012 and is convertible at the option of the holder at a price of $0.001 per share. No payments have been made on this note. During the nine months ended September 30, 2012, a portion of the note in the amount of $18,000 was converted to Common Stock.              |   |               | 2,000  |   |              |   | - |   |   |   | 2,000 |   |   |   | 20,000 |   |   |   | (11,857 | ) |   |   | 8,143 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On August 18, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $2,500. Terms include simple interest at ten percent (10.0%), the note is due on August 18, 2012 and is convertible at the option of the holder at a price of $0.001 per share. No payments have been made on this note.                                                                                                                                                 |   |               | 2,500  |   |              |   | - |   |   |   | 2,500 |   |   |   | 2,500 |   |   |   | (1,577 | ) |   |   | 923 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On September 13, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $6,000. Terms include simple interest at ten percent (10.0%), the note is due on September 13, 2012 and is convertible at the option of the holder at a price of $0.001 per share. No payments have been made on this note.                                                                                                                                           |   |               | 6,000  |   |              |   | - |   |   |   | 6,000 |   |   |   | 6,000 |   |   |   | (4,212 | ) |   |   | 1,788 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On September 22, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $1,000. Terms include simple interest at ten percent (10.0%), the note is due on September 22, 2012 and is convertible at the option of the holder at a price of $0.001 per share. No payments have been made on this note.                                                                                                                                           |   |               | 1,000  |   |              |   | - |   |   |   | 1,000 |   |   |   | 1,000 |   |   |   | (726 | ) |   |   | 274 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On September 28, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $2,000. Terms include simple interest at ten percent (10.0%), the note is due on September 28, 2012 and is convertible at the option of the holder at a price of $0.001 per share. No payments have been made on this note.                                                                                                                                           |   |               | 2,000  |   |              |   | - |   |   |   | 2,000 |   |   |   | 2,000 |   |   |   | (1,189 | ) |   |   | 811 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On October 6, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $5,800. Terms include simple interest at ten percent (10.0%), the note is due on October 6, 2012 and is convertible at the option of the holder at a price of $0.001 per share. No payments have been made on this note.                                                                                                                                                 |   |               | 5,800  |   |              |   | (10 | ) |   |   | 5,790 |   |   |   | 5,800 |   |   |   | (444 | ) |   |   | 5,356 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On October 21, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $1,700. Terms include simple interest at ten percent (10.0%), the note is due on October 21, 2012 and is convertible at the option of the holder at a price of $0.001 per share. No payments have been made on this note.                                                                                                                                               |   |               | 1,700  |   |              |   | (39 | ) |   |   | 1,661 |   |   |   | 1,700 |   |   |   | (548 | ) |   |   | 1,152 |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   | September 30, 2012 |    |   | December 31, 2011 |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------|---------|--------|-------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |               |    |   |              |   |   | Principal, |   |   |   |   |   |   |   |   | Principal, |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |               |    |   | Unamortized       |   |   | net of |   |   |   |   |   | Unamortized |   |   | net of |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   | Principal          |    |   | Discount          |   |   | Discounts |   |   | Principal |   |   | Discount |   |   | Discounts |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On November 23, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $2,000. Terms include simple interest at ten percent (10.0%), the note is due on November 23, 2012 and is convertible at the option of the holder at a price of $0.001 per share. No payments have been made on this note.                                                                                                                                                                                                                            |   |               | 2,000   |   |              |   | (118 | ) |   |   | 1,882 |   |   |   | 2,000 |   |   |   | (717 | ) |   |   | 1,283 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On December 5, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $11,500. Terms include simple interest at ten percent (10.0%), the note is due on December 5, 2012 and is convertible at the option of the holder at a price of $0.001 per share. No payments have been made on this note.                                                                                                                                                                                                                             |   |               | 11,500  |   |              |   | (830 | ) |   |   | 10,670 |   |   |   | 11,500 |   |   |   | (4,273 | ) |   |   | 7,227 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On January 8, 2012 the Company converted accrued compensation and entered into a convertible promissory note with its former Chief Executive Officer in the amount of $501,425. Terms include simple interest at six and one-quarter percent (6.25%), the note is due on January 8, 2013 and is convertible at the lower of 1) a price of $0.001, or 2) a seventy-five percent discount to the previous day's closing bid price if the closing bid price is $0.0015 per share or less. During the nine months ended September 30, 2012, $20,000 has been paid on the note. |   |               | 481,425 |   |              |   | (137,001 | ) |   |   | 344,424 |   |   |   | - |   |   |   | - |   |   |   | - |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On January 20, 2012 the Company entered into a convertible promissory note with an investment firm in the amount of $17,700. Terms include simple interest at ten percent (10.0%), the note is due on demand and is convertible at the option of the holder at a price of $0.001 per share. No payments have been made on this note.                                                                                                                                                                                                                                       |   |               | 17,700  |   |              |   | - |   |   |   | 17,700 |   |   |   | - |   |   |   | - |   |   |   | - |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On January 26, 2012 the Company entered into a convertible promissory note with an investment firm in the amount of $36,580. Terms include simple interest at ten percent (10.0%), the note is due on January 26, 2013 and is convertible at the option of the holder at a price of $0.001 per share. No payments have been made on this note. On August 15, 2012, the note plus accrued interest of $2,225 was assigned to a third party investment firm.                                                                                                            |   |               | -       |   |              |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On February 3, 2012 the Company entered into a convertible promissory note with an investment firm in the amount of $3,000. Terms include simple interest at ten percent (10.0%), the note is due on demand and is convertible at the option of the holder at a price of $0.001 per share. No payments have been made on this note.                                                                                                                                                                                                                                        |   |               | 3,000   |   |              |   | - |   |   |   | 3,000 |   |   |   | - |   |   |   | - |   |   |   | - |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On February 27, 2012 the Company entered into a convertible promissory note with an investment firm in the amount of $900. Terms include simple interest at ten percent (10.0%), the note is due on February 27, 2013 and is convertible at the option of the holder at a price of $0.001 per share. No payments have been made on this note.                                                                                                                                                                                                                              |   |               | 900     |   |              |   | (368 | ) |   |   | 532 |   |   |   | - |   |   |   | - |   |   |   | - |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On March 20, 2012 the Company entered into a convertible promissory note with an investment firm in the amount of $1,370. Terms include simple interest at ten percent (10.0%), the note is due on demand and is convertible at the option of the holder at a price of $0.001 per share. No payments have been made on this note.                                                                                                                                                                                                                                          |   |               | 1,370   |   |              |   | - |   |   |   | 1,370 |   |   |   | - |   |   |   | - |   |   |   | - |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On March 21, 2012 the Company entered into a convertible promissory note with an investment firm in the amount of $1,600. Terms include simple interest at ten percent (10.0%), the note is due on March 21, 2013 and is convertible at the option of the holder at a price of $0.001 per share. No payments have been made on this note.                                                                                                                                                                                                                                  |   |               | 1,600   |   |              |   | (754 | ) |   |   | 846 |   |   |   | - |   |   |   | - |   |   |   | - |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   | September 30, 2012 |    |   | December 31, 2011 |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------|---------|--------|-------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |               |    |   |              |   |   | Principal, |   |   |   |   |   |   |   |   | Principal, |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |               |    |   | Unamortized       |   |   | net of |   |   |   |   |   | Unamortized |   |   | net of |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   | Principal          |    |   | Discount          |   |   | Discounts |   |   | Principal |   |   | Discount |   |   | Discounts |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On March 28, 2012 the Company entered into a convertible promissory note with an investment firm in the amount of $11,500. Terms include simple interest at ten percent (10.0%), the note is due on demand and is convertible at the option of the holder at a price of $0.001 per share. No payments have been made on this note.                                                                                                                                                                                                                                                                                                                                                     |   |               | 11,500  |   |              |   | - |   |   |   | 11,500 |   |   |   | - |   |   |   | - |   |   |   | - |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On July 9, 2012 the Company entered into a convertible promissory note with an investment firm in the amount of $1,000. Terms include simple interest at ten percent (10.0%), the note is due on July 9, 2013 and is convertible at the option of the holder at a price of $0.001 per share. No payments have been made on this note.                                                                                                                                                                                                                                                                                                                                                  |   |               | 1,000   |   |              |   | (772 | ) |   |   | 228 |   |   |   | - |   |   |   | - |   |   |   | - |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On March 31, 2011 the Company entered into a stock repurchase agreement with a NexPhase investor to repurchase 100,000 shares of Common Stock acquired in the NexPhase acquisition. Terms include principal in the amount of $27,500 including premium interest of ten percent (10.0%) ($2,500), the note is due on June 30, 2012.  Payments totaling $7,453 have been made on this note during the year ended December 31, 2011.  Payments totaling $12,000 have been made on this note during the six months ended June 30, 2012.  The note is currently in default.                                                                                   |   |               | 8,048   |   |              |   | - |   |   |   | 8,048 |   |   |   | 20,048 |   |   |   | - |   |   |   | 20,048 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On March 31, 2011 the Company entered into a stock repurchase agreement with a NexPhase investor to repurchase 20,000 shares of Common Stock acquired in the NexPhase acquisition. Terms include principal in the amount of $5,500 including premium interest of ten percent (10.0%) ($500), the note is due on June 30, 2012.  No payments have been made on this note.  Payments totaling $1,490 have been made on this note during the year ended December 31, 2011.  The note is currently in default.                                                                                                                                               |   |               | 4,010   |   |              |   | - |   |   |   | 4,010 |   |   |   | 4,010 |   |   |   | - |   |   |   | 4,010 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On March 31, 2011 the Company entered into a stock repurchase agreement with a NexPhase investor to repurchase 24,000 shares of Common Stock acquired in the NexPhase acquisition. Terms include principal in the amount of $6,600 including premium interest of ten percent (10.0%) ($600), the note is due on June 30, 2012.  No payments have been made on this note.  The note is currently in default.                                                                                                                                                                                                                                                        |   |               | 6,600   |   |              |   | - |   |   |   | 6,600 |   |   |   | 6,600 |   |   |   | - |   |   |   | 6,600 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On March 31, 2011the Company entered into a stock repurchase agreement with a NexPhase investor to repurchase 20,000 shares of Common Stock acquired in the NexPhase acquisition. Terms include principal in the amount of $5,500 including premium interest of ten percent (10.0%) ($500), the note is due on June 30, 2012.  No payments have been made on this note.  The note is currently in default.                                                                                                                                                                                                                                                         |   |               | 5,500   |   |              |   | - |   |   |   | 5,500 |   |   |   | 5,500 |   |   |   | - |   |   |   | 5,500 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On March 31, 2011 the Company entered into a stock repurchase agreement with a NexPhase investor to repurchase 80,000 shares of Common Stock acquired in the NexPhase acquisition. Terms include principal in the amount of $22,000 including premium interest of ten percent (10.0%) ($2000), the note is due on June 30, 2012.  On June 21 2011, a payment in the amount of $2,200 was made on this note.  Payments totaling $5,962 have been made on this note during the year ended December 31, 2011.  Payments totaling $2,000 have been made on this note during the six months ended June 30, 2012.  The note is currently in default. |   |               | 14,038  |   |              |   | - |   |   |   | 14,038 |   |   |   | 16,038 |   |   |   | - |   |   |   | 16,038 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Notes Payable -- Related Parties                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   | $                  | 702,690 |   |              | $      | (139,892 | ) |   | $ | 562,798 |   |   | $ | 402,345 |   |   | $ | (72,139 | ) |   | $ | 330,206 |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                               |   | September 30, 2012 |   |   | December 31, 2011 |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------|--------|--------|-------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                               |   |               |   |   |              |   |   | Principal, |   |   |   |   |   |   |   |   | Principal, |   |
|                                                                                                                                                                                                                                                                                                                                                                                                               |   |               |   |   | Unamortized       |   |   | net of |   |   |   |   |   | Unamortized |   |   | net of |   |
|                                                                                                                                                                                                                                                                                                                                                                                                               |   | Principal          |   |   | Discount          |   |   | Discounts |   |   | Principal |   |   | Discount |   |   | Discounts |   |
|                                                                                                                                                                                                                                                                                                                                                                                                               |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On January 17, 2010 the Company entered into a convertible promissory note with an advisory firm for services rendered in the amount of $59,000. Terms include bonus interest of $5,900, the note is payable on demand and has no stated interest rate or due date and is convertible at a rate of $0.03 per share or 1,771,667 unregistered common shares. Total payments of $11,750 have been made on this note. |   | $                  | 53,150 |   |              | $      | - |   |   | $ | 53,150 |   |   | $ | 53,150 |   |   | $ | - |   |   | $ | 53,150 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                               |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On February 10, 2010 the Company entered into a convertible promissory note with a project consultant for services rendered in the amount of $7,800. Terms include bonus interest of $780, the note is payable on demand and has no stated interest rate or due date and is convertible at a rate of $0.03 per share or 286,000 unregistered common shares. No payments have been made on this note.               |   |               | 8,580  |   |              |   | - |   |   |   | 8,580 |   |   |   | 8,580 |   |   |   | - |   |   |   | 8,580 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                               |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On February 10, 2010 the Company entered into a convertible promissory note with an engineering firm for services rendered in the amount of $27,600. Terms include bonus interest of $2,760, the note is payable on demand and has no stated interest rate or due date and is convertible at a rate of $0.03 per share or 1,012,000 unregistered common shares. No payments have been made on this note.           |   |               | 30,360 |   |              |   | - |   |   |   | 30,360 |   |   |   | 30,360 |   |   |   | - |   |   |   | 30,360 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                               |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On June 7, 2010 the Company entered into a convertible promissory note with an investor in the amount of $10,000. The note is payable on demand and has no stated interest rate or due date and is convertible at a rate of $0.03 per share or 333,333 unregistered common shares. No payments have been made on this note.                                                                                        |   |               | 10,000 |   |              |   | - |   |   |   | 10,000 |   |   |   | 10,000 |   |   |   | - |   |   |   | 10,000 |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   | September 30, 2012 |   |   | December 31, 2011 |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------|--------|--------|-------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |               |   |   |              |   |   | Principal, |   |   |   |   |   |   |   |   | Principal, |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |               |   |   | Unamortized       |   |   | net of |   |   |   |   |   | Unamortized |   |   | net of |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   | Principal          |   |   | Discount          |   |   | Discounts |   |   | Principal |   |   | Discount |   |   | Discounts |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On July 19, 2010 the Company entered into a convertible promissory note with an investor in the amount of $2,500. The note is payable on demand and has no stated interest rate or due date and is convertible at a rate of $0.03 per share or 83,333 unregistered common shares. No payments have been made on this note.                                                                                                                                                                                                                                                                                                                          |   |               | 2,500  |   |              |   | - |   |   |   | 2,500 |   |   |   | 2,500 |   |   |   | - |   |   |   | 2,500 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On April 28 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $56,000. Terms include simple interest at eight percent (8.0%), the note is due on January 31 2012 and is convertible at the option of the holder at a price calculated at a forty percent discount to the market closing bid price on the date of the conversion notice. As of December 31, 2011, a portion of the note in the amount of $35,500 has been converted to Common Stock.  During the six months ended June 30, 2012, the remainder of the note in the amount of $20,500 was converted to Common Stock. |   |               | -      |   |              |   | - |   |   |   | - |   |   |   | 20,500 |   |   |   | (1,524 | ) |   |   | 18,976 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On June 20, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $53,000. Terms include simple interest at eight percent (8.0%), the note is due on March 22, 2012 and is convertible at the option of the holder at a price calculated at a forty percent discount to the market closing bid price on the date of the conversion notice. During the six months ended June 30, 2012, the note in the amount of $53,000 was converted to Common Stock.                                                                                                                                          |   |               | -      |   |              |   | - |   |   |   | - |   |   |   | 53,000 |   |   |   | (10,497 | ) |   |   | 42,503 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On August 24, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $15,000. Terms include simple interest at ten percent (10.0%), the note is due on April 24, 2012 and is convertible at the option of the holder at a price calculated at a fifty percent discount to the market closing bid price on the date of the conversion notice. During the six months ended June 30, 2012, the note in the amount of $15,000 plus accrued interest of $2,425 was converted to Common Stock.                                                                                                         |   |               | -      |   |              |   | - |   |   |   | - |   |   |   | 15,000 |   |   |   | (7,069 | ) |   |   | 7,931 |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   | September 30, 2012 |   |   | December 31, 2011 |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------|--------|--------|-------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |               |   |   |              |   |   | Principal, |   |   |   |   |   |   |   |   | Principal, |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |               |   |   | Unamortized       |   |   | net of |   |   |   |   |   | Unamortized |   |   | net of |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   | Principal          |   |   | Discount          |   |   | Discounts |   |   | Principal |   |   | Discount |   |   | Discounts |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On September 1, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $50,000. Terms include simple interest at eight percent (8.0%), the note is due on June 6, 2012 and is convertible at the option of the holder at a price calculated at a forty percent discount to the market closing bid price on the date of the conversion notice. During the six months ended June 30, 2012, the note in the amount of $50,000 was paid plus accrued interest of $2,315 and a redemption premium of $22,685.                                                                                                                                                                                                                                  |   |               | -      |   |              |   | - |   |   |   | - |   |   |   | 50,000 |   |   |   | (18,877 | ) |   |   | 31,123 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On October 26, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $12,000. Terms include simple interest at twelve percent (12.0%), the note is due on October 26, 2012 and is convertible at the option of the holder at a price calculated at a fifty percent discount to the market closing bid price on the date of the conversion notice. During the six months ended June 30, 2012, the note in the amount of $12,000 plus accrued interest of $2,175 was converted to Common Stock.                                                                                                                                                                                                                                            |   |               | -      |   |              |   | - |   |   |   | - |   |   |   | 12,000 |   |   |   | (9,835 | ) |   |   | 2,165 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On October 26, 2011 the Company entered into a convertible promissory note with a an investment firm in the amount of $78,124. Terms include simple interest at twelve percent (12.0%), the note is due on June 26, 2012 and is convertible at the option of the holder at a price calculated at a fifty percent discount to the market closing bid price on the date of the conversion notice. The note was assigned from a non-affiliated related party investment firm.  No payments have been made on this note. As of December 31, 2011, a portion of the note in the amount of $38,124 has been converted to Common Stock.  During the six months ended June 30, 2012, the remainder of the note in the amount of $40,000 was converted to Common Stock. |   |               | -      |   |              |   | - |   |   |   | - |   |   |   | 40,000 |   |   |   | (29,180 | ) |   |   | 10,820 |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   | September 30, 2012 |   |   | December 31, 2011 |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------|--------|--------|-------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |               |   |   |              |   |   | Principal, |   |   |   |   |   |   |   |   | Principal, |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |               |   |   | Unamortized       |   |   | net of |   |   |   |   |   | Unamortized |   |   | net of |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   | Principal          |   |   | Discount          |   |   | Discounts |   |   | Principal |   |   | Discount |   |   | Discounts |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On December 5, 2011 the Company entered into a convertible promissory note with a an investment firm in the amount of $25,000. Terms include simple interest at ten percent (10.0%), the note is due on December 5, 2012 and is convertible at the option of the holder at a the lesser of par ($0.001) or a price calculated at a fifty percent discount to the market closing bid price on the date of the conversion notice. The note was assigned from a non-affiliated related party investment firm.  No payments have been made on this note. As of December 31, 2011, a portion of the note in the amount of $6,800 has been converted to Common Stock.  During the nine months ended September 30, 2012, the remainder of the note in the amount of $18,200 was converted to Common Stock. |   |               | -      |   |              |   | - |   |   |   | - |   |   |   | 18,200 |   |   |   | (6,763 | ) |   |   | 11,437 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On February 7, 2012 the Company entered into a convertible promissory note with a an investment firm in the amount of $32,500. Terms include simple interest at eight percent (8.0%), the note is due on November 9, 2012 and is convertible at the option of the holder at a price calculated at a forty-five percent discount to the market closing bid price on the date of the conversion notice.  No payments have been made on this note. During the nine months ended September 30, 2012, a portion of the note in the amount of $21,300 was converted to Common Stock.                                                                                                                                                                                                                                     |   |               | 11,200 |   |              |   | (1,272 | ) |   |   | 9,928 |   |   |   | - |   |   |   | - |   |   |   | - |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On February 10, 2012 the Company entered into a convertible promissory note with a an investment firm in the amount of $19,000. Terms include simple interest at ten percent (10.0%), the note is due on February 10, 2013 and is convertible at the option of the holder at a price of $0.001.  No payments have been made on this note.                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |               | 19,000 |   |              |   | (6,904 | ) |   |   | 12,096 |   |   |   | - |   |   |   | - |   |   |   | - |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On April 2, 2012 the Company entered into a convertible promissory note with a an investment firm in the amount of $75,000. Terms include simple interest at ten percent (10.0%), the note is due on April 2, 2013 and is convertible at the option of the holder at a price of $0.001. The note was assigned from a non-affiliated related party investment firm.  No payments have been made on this note.                                                                                                                                                                                                                                                                                                                                                                                                       |   |               | 75,000 |   |              |   | (37,808 | ) |   |   | 37,192 |   |   |   | - |   |   |   | - |   |   |   | - |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On April 3, 2012 the Company entered into a convertible promissory note with a an investment firm in the amount of $37,500. Terms include simple interest at eight percent (8.0%), the note is due on January 9, 2013 and is convertible at the option of the holder at a price calculated at a forty-five percent discount to the market closing bid price on the date of the conversion notice.  No payments have been made on this note.                                                                                                                                                                                                                                                                                                                                                                             |   |               | 37,500 |   |              |   | (11,015 | ) |   |   | 26,485 |   |   |   | - |   |   |   | - |   |   |   | - |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On May 21, 2012 the Company entered into a convertible promissory note with a an investment firm in the amount of $37,500. Terms include simple interest at eight percent (8.0%), the note is due on February 25, 2013 and is convertible at the option of the holder at a price calculated at a forty-five percent discount to the market closing bid price on the date of the conversion notice.  No payments have been made on this note.                                                                                                                                                                                                                                                                                                                                                                            |   |               | 32,500 |   |              |   | (13,874 | ) |   |   | 18,626 |   |   |   | - |   |   |   | - |   |   |   | - |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   | September 30, 2012 |   |   | December 31, 2011 |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------|--------|--------|-------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |               |   |   |              |   |   | Principal, |   |   |   |   |   |   |   |   | Principal, |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |               |   |   | Unamortized       |   |   | net of |   |   |   |   |   | Unamortized |   |   | net of |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   | Principal          |   |   | Discount          |   |   | Discounts |   |   | Principal |   |   | Discount |   |   | Discounts |   |
| On December 15, 2010 the Company entered into a convertible promissory note with a non affiliate related party in the amount of $40,000. Terms include simple interest at twelve percent (12%), the note was due on December 15, 2011 and was convertible convertible at the option of the holder at a price which is the greater of (i) twice the par value of the common stock, or (ii) a seventy-five percent discount to the market closing bid price on the date of the conversion notice. On July 12, 2012, the note was assigned from the non affiliate related party to a thrid party investor firm.  The balance of the note assigned, including accrued interest, was $52,015.  The Company replaced the original note with a new convertible promissory note to the thrid party investment firm. Terms include simple interest at twelve percent (12.0%), the note is due on July 12, 2013 and is convertible at the option of the holder at a price calculated at a fifty percent discount to the lowest trading price during the three days prior to the date of the conversionon notice.  No payments have been made on this note. During the nine months ended September 30, 2012, a portion of the note in the amount of $24,915 was converted to Common Stock.                                                                                                                                                                                                                                                                                                                                                           |   |               | 27,100 |   |              |   | (21,160 | ) |   |   | 5,940 |   |   |   | - |   |   |   | - |   |   |   | - |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On July 12, 2012 the Company entered into a convertible promissory note with an investment firm in the amount of $26,500. Terms include simple interest at twelve percent (12.0%), the note is due on March 12, 2013 and is convertible at the option of the holder at a price calculated at a fifty percent discount to average of the lowest three trading prices during the ten day period prior to the date of the conversion notice.  No payments have been made on this note.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |               | 26,500 |   |              |   | (20,691 | ) |   |   | 5,809 |   |   |   | - |   |   |   | - |   |   |   | - |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On December 10, 2010 the Company entered into a convertible promissory note with an investment firm in the amount of $40,000. Terms include simple interest at twelve percent (12.0%), the note is due on December 8, 2011 and is convertible at the option of the holder at a price which is the greater of (i) twice the par value of the common stock, or (ii) a seventy-five percent discount to the market closing bid price on the date of the conversion notice. No payments have been made on this note. On March 11, 2011 the Company entered into a convertible promissory note with an investment firm in the amount of $20,000. Terms include simple interest at twelve percent (12.0%), the note is due on March 11, 2012 and is convertible at the option of the holder at a price which is the greater of (i) twice the par value of the common stock, or (ii) a seventy-five percent discount to the market closing bid price on the date of the conversion notice. On July 31, 2012, the notes were assigned from the non affiliate related parties to a thrid party investor firm.  The balance of the notes assigned, including accrued interest, was $75,674.  The Company replaced the original note with a new convertible promissory note to the thrid party investment firm. Terms include simple interest at twelve percent (12.0%), the note is due on July 31, 2013 and is convertible at the option of the holder at a price calculated at a fifty percent discount to the lowest trading price during the three days prior to the date of the conversionon notice.  No payments have been made on this note. |   |               | 75,674 |   |              |   | (63,026 | ) |   |   | 12,648 |   |   |   | - |   |   |   | - |   |   |   | - |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On August 1, 2012 the Company entered into a convertible promissory note with a an investment firm in the amount of $32,500. Terms include simple interest at eight percent (8.0%), the note is due on May 3, 2013 and is convertible at the option of the holder at a price calculated at a forty-five percent discount to the avaerage of the two lowest trading prices during the thirty trading day period prior to the date of the conversion notice.  No payments have been made on this note.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |               | 32,500 |   |              |   | (20,789 | ) |   |   | 11,711 |   |   |   | - |   |   |   | - |   |   |   | - |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On August 14, 2012 the Company entered into a convertible promissory note with a an investment firm in the amount of $42,500. Terms include simple interest at eight percent (8.0%), the note is due on May 16, 2013 and is convertible at the option of the holder at a price calculated at a forty-five percent discount to the avaerage of the three lowest trading prices during the ten trading day period prior to the date of he conversion notice.  No payments have been made on this note.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |               | 42,500 |   |              |   | (28,830 | ) |   |   | 13,670 |   |   |   | - |   |   |   | - |   |   |   | - |   |

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|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   | September 30, 2012 |    |   | December 31, 2011 |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------|---------|--------|-------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |               |    |   |              |   |   | Principal, |   |   |   |   |   |   |   |   | Principal, |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |               |    |   | Unamortized       |   |   | net of |   |   |   |   |   | Unamortized |   |   | net of |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   | Principal          |    |   | Discount          |   |   | Discounts |   |   | Principal |   |   | Discount |   |   | Discounts |   |
| On January 26, 2012 the Company entered into a convertible promissory note with a non affiliate related party in the amount of $36,580. Terms include simple interest at twelve percent (10%), the note was due on January 26, 2013 and was convertible at the option of the holder at a price of $0.001 per share. On August 15, 2012, the note was assigned from the non affiliate related party to a thrid party investment firm.  The balance of the note assigned, including accrued interest, was $38,805.  The Company replaced the original note with a new convertible promissory note to the thrid party investment firm. Terms include simple interest at ten percent (10.0%), the note is due on January 26, 2013 and is convertible at the option of the holder at a price calculated at a forty-five percent discount to the average of the three lowest trading price during the ten day period prior to the date of the conversionon notice.  No payments have been made on this note. During the nine months ended September 30, 2012, a portion of the note in the amount of $2,225 was converted to Common Stock. |   |               | 36,580  |   |              |   | (21,543 | ) |   |   | 15,037 |   |   |   | - |   |   |   | - |   |   |   | - |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On August 16, 2012 the Company entered into a convertible promissory note with a an investment firm in the amount of $5,000. Terms include simple interest at ten percent (10.0%), the note is due on August 16, 2013 and is convertible at the option of the holder at the lower of 1) a price of $0.001, or 2) a seventy-five percent discount to the previous day's closing bid price if the closing bid price is $0.0015 per share or less.   No payments have been made on this note.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |               | 5,000   |   |              |   | (4,383 | ) |   |   | 617 |   |   |   | - |   |   |   | - |   |   |   | - |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On September 20, 2012 the Company entered into a convertible promissory note with a an investment firm in the amount of $5,000. Terms include simple interest at ten percent (10.0%), the note is due on September 20, 2013 and is convertible at the option of the holder at the lower of 1) a price of $0.001, or 2) a seventy-five percent discount to the previous day's closing bid price if the closing bid price is $0.0015 per share or less.   No payments have been made on this note.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |               | 5,000   |   |              |   | (4,862 | ) |   |   | 138 |   |   |   | - |   |   |   | - |   |   |   | - |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total - Notes Payable -- Third Parties                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   | $                  | 530,644 |   |              | $      | (256,157 | ) |   | $ | 274,487 |   |   | $ | 313,290 |   |   | $ | (83,745 | ) |   | $ | 229,545 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

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|                                           |   | For the Three Months Ended |    |   | For the Nine Months Ended |   |
|------------------------------------------------|--------|----------------------------|---------|--------|---------------------------|--------|
|                                           |   | September 30,              |    |   | September 30,             |   |
|                                           |   | 2012                       |    |   | 2011                      |   |   | 2012 |   |   | 2011 |   |
|                                           |   |                       |    |   |                      |   |   |   |   |   |   |   |
| Revenue                                        |   | $                          | 102,782 |   |                      | $      | 203,024 |   |   | $ | 171,303 |   |   | $ | 282,461 |   |
| Cost of goods sold                             |   |                       | -       |   |                      |   | 219 |   |   |   | 828 |   |   |   | 36,229 |   |
| Gross profit                                   |   |                       | 102,782 |   |                      |   | 202,805 |   |   |   | 170,475 |   |   |   | 246,232 |   |
|                                           |   |                       |    |   |                      |   |   |   |   |   |   |   |   |   |   |   |
| Operating expenses:                            |   |                       |    |   |                      |   |   |   |   |   |   |   |   |   |   |   |
| General and administrative                     |   |                       | 713     |   |                      |   | 27,661 |   |   |   | 11,911 |   |   |   | 57,175 |   |
| Investor relations                             |   |                       | -       |   |                      |   | - |   |   |   | - |   |   |   | 21,440 |   |
| Occupancy - Headquarters                       |   |                       | -       |   |                      |   | 6,939 |   |   |   | - |   |   |   | 20,406 |   |
| Professional fees                              |   |                       | -       |   |                      |   | 730 |   |   |   | - |   |   |   | 14,609 |   |
| Staff compensation                             |   |                       | -       |   |                      |   | 135,909 |   |   |   | 42,504 |   |   |   | 294,309 |   |
| Depreciation                                   |   |                       | 5,646   |   |                      |   | 2,142 |   |   |   | 18,895 |   |   |   | 6,427 |   |
| Total operating expenses                       |   |                       | 6,359   |   |                      |   | 173,381 |   |   |   | 73,310 |   |   |   | 414,366 |   |
|                                           |   |                       |    |   |                      |   |   |   |   |   |   |   |   |   |   |   |
| Income (loss) from discontinued operations     |   |                       | 96,423  |   |                      |   | 29,424 |   |   |   | 97,165 |   |   |   | (168,134 | ) |
|                                           |   |                       |    |   |                      |   |   |   |   |   |   |   |   |   |   |   |
| Other expenses:                                |   |                       |    |   |                      |   |   |   |   |   |   |   |   |   |   |   |
| Interest expense                               |   |                       | 16,201  |   |                      |   | 11,224 |   |   |   | 152,050 |   |   |   | 28,614 |   |
|                                           |   |                       |    |   |                      |   |   |   |   |   |   |   |   |   |   |   |
| Net income (loss) from discontinued operations |   | $                          | 80,222  |   |                      | $      | 18,200 |   |   | $ | (54,885 | ) |   | $ | (196,748 | ) |

|                                                |   | September 30, |      |   | December 31, |   |
|-----------------------------------------------------|--------|---------------|-----------|--------|--------------|--------|
|                                                |   | 2012          |      |   | 2011         |   |
| ASSETS                                              |   |          |      |   |         |   |
| Current assets:                                     |   |          |      |   |         |   |
| Cash in banks                                       |   | $             | 7,720     |   |         | $      | 41,128 |   |
|  Accounts receivable                           |   |          | -         |   |         |   | 2,251 |   |
|  Due from licensee                             |   |          | 200,000   |   |         |   | - |   |
|  Inventories                                   |   |          | 79,345    |   |         |   | 74,947 |   |
|  Total current assets                          |   |          | 287,065   |   |         |   | 118,326 |   |
|                                                |   |          |      |   |         |   |   |   |
|  Property and equipment, net                   |   |          | 85,234    |   |         |   | 97,979 |   |
|  Marketable securities                         |   |          | 2,677,890 |   |         |   | - |   |
|  Intellectual property                         |   |          | 2,989,149 |   |         |   | 2,989,149 |   |
|  Security deposits                             |   |          | 4,120     |   |         |   | 4,120 |   |
|                                                |   |          |      |   |         |   |   |   |
|  Total assets of discontinued operations       |   | $             | 6,043,458 |   |         | $      | 3,209,574 |   |
|                                                |   |          |      |   |         |   |   |   |
|  LIABILITIES                                   |   |          |      |   |         |   |   |   |
|  Current liabilities:                          |   |          |      |   |         |   |   |   |
|  Accounts payable                              |   | $             | 56,117    |   |         | $      | 112,046 |   |
|  Accrued interest                              |   |          | 46,968    |   |         |   | 38,244 |   |
|  Sales tax payable                             |   |          | 2,679     |   |         |   | 2,678 |   |
|  Due to Onteco                                 |   |          | 659,220   |   |         |   | 405,528 |   |
|  Deferred license fee revenue, current         |   |          | 411,128   |   |         |   | - |   |
|  Notes payable, non-affiliated related parties |   |          | 208,309   |   |         |   | 242,614 |   |
|  Deferred license fee revenue, non current     |   |          | 2,295,459 |   |         |   | - |   |
|                                                |   |          |      |   |         |   |   |   |
|  Total liabilities of discontinued operations  |   | $             | 3,679,880 |   |         | $      | 801,110 |   |

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| Remainder of 2012 |   | $ | 11,383 |   |
|-------------------|--------|---|--------|--------|
| 2013              |   | $ | 45,528 |   |
| 2014              |   | $ | 3,794  |   |

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| (a)   | Evaluation of Disclosure Controls and Procedures |
|-----------------|--------------------------------------------------|

| (b)   | Changes in Internal Control over Financial Reporting |
|-----------------|------------------------------------------------------|

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|   | Exhibit 31.1       |   | Rule 13a-14(a) Certification by the Principal Executive Officer                                                                                           |
|--------|--------------------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | Exhibit 31.2       |   | Rule 13a-14(a) Certification by the Principal Financial Officer                                                                                           |
|   | Exhibit 32.1       |   | Certification by the Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
|   | Exhibit 32.2       |   | Certification by the Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
|   | Exhibit 101.INS ** |   | XBRL Instance Document                                                                                                                                    |
|   | Exhibit 101.SCH ** |   | XBRL Schema Document                                                                                                                                      |
|   | Exhibit 101.CAL ** |   | XBRL Calculation Linkbase Document                                                                                                                        |
|   | Exhibit 101.DEF ** |   | XBRL Definition Linkbase Document                                                                                                                         |
|   | Exhibit 101.LAB ** |   | XBRL Label Linkbase Document                                                                                                                              |
|   | Exhibit 101.PRE ** |   | XBRL Presentation Linkbase Document                                                                                                                       |

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|                               |   |                                                                                |   |
|------------------------------------|--------|-------------------------------------------------------------------------------------|--------|
| Date:  November 19, 2012 | By:    | /s/Jorge Schcolnik                                                                  |   |
|                               |   | Jorge Schcolnik                                                                     |   |
|                               |   | President                                                                           |   |
|                               |   | (Principal Executive Officer) Chief Financial Officer (Principal Financial Officer) |   |

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