Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2013

Summary of Measurement of Fair Value on a Recurring Basis

Amount

Quoted Prices

Significant

Recorded on

in Active

Other

Significant

Consolidated

Markets for

Observable

Unobservable

Balance

Identical Assets

Inputs

Sheets

(Level 1)

(Level 2)

(Level 3)

Liabilities as of December 31, 2013 Contingent obligation (1)

Liabilities as of December 31, 2012 Contingent obligation (1)

1,250,000

Changes in the fair value measurement of contingent seller financed promissory note using significant unobservable inputs classified as Level 3 and valuation method used to estimate fair values are set forth below as of and for the years ended:

Schedule of Changes in the Fair Value Measurement of Contingent Obligation using Significant Unobservable Inputs

	YEAR ENDED
	DECEMBER, 31
	2013			2012

Balance, Beginning of Period	$	1,250,000		$	2,150,000
Total gains or losses for the period:
Non-cash gain on change in fair value of contingent obligation included in general and administrative expense (1)		(1,250,000	)		(900,000	)
Balance, End of Period	$	-		$	1,250,000

(1)

The Company determined the fair value of its contingent obligation based on a probability weighted discounted cash flow valuation technique. The potential probability for payout of contingent consideration is considered remote.

- Definition

Tabular disclosure of liabilities, including [financial] instruments measured at fair value that are classified in stockholders' equity, if any, by class that are measured at fair value on a recurring basis. The disclosures contemplated herein include the fair value measurements at the reporting date by the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3). Where the quoted price in an active market for the identical liability is not available, the Level 1 input is the quoted price of an identical liability when traded as an asset.

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- Definition

Tabular disclosure of the fair value measurement of liabilities using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets), and gains or losses recognized in other comprehensive income (loss) and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs) by class of liability.

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