ASSET PURCHASE

12 Months Ended

Dec. 31, 2012

Notes to Financial Statements

ASSET PURCHASE - GREENER.COM

NOTE 4 – ASSET PURCHASE – GRENERS.COM

On July 23, 2012, we completed the purchase of substantially all of the assets of Greners, related to the online retail business currently operated by Greners, pursuant to the terms of an Asset Purchase Agreement. The Assets included equipment, finished goods, materials and supplies, contract rights, domain names and implemented and operational components of software. In addition, the Company assumed certain of Greners’ liabilities which included Greners’ liabilities and obligations under its contracts and all express and implied warranties related to any materials supplied by Greners prior to the closing date.

In consideration for the assets of Greners, the Company agreed to pay to Greners an aggregate of $450,000. $250,000 of the purchase price was paid in cash on the closing date and the remaining portion of the purchase price was paid in the form of a Note issued by the Company to Greners in the original principal amount of $200,000.

The Company has estimated that the fair value of the assets purchased to be $450,000; The purchase price has been allocated to specific identifiable tangible and intangible assets at their fair value at the date of the purchase in accordance with Accounting Standards Codification 805, “Business Combinations”, as follows:

Tangible assets	$	93,000
Intangible assets		233,500
Goodwill		123,500
Total		450,000
Less fair value of liabilities assumed		—
Purchase price	$	450,000

The intangible assets relate to customer lists and the website and will be amortized over their life of five and ten years, respectively.

Unaudited Pro-forma results of operations as if the acquisition had occurred at the beginning of the period for the year ended December 31, 2012 and 2011 are as follows:

	For the Years Ended
	December 31,
	2012			2011
Revenue	$	2,784,700		$	3,974,061
Cost of revenue		2,084,936			3,234,220
Gross profit		699,764			739,841
General and administrative		2,312,568			1,255,690
Loss from operations		(1,612,804	)		(515,849	)
Other expenses
Impairment of goodwill		(634,128	)		—
Loss on extinguishment of debt		(428,467	)
Change in fair value of derivatives		525,619			—
Interest expense,net		(379,383	)		(24,683	)
Net loss	$	(2,529,162	)	$	(540,532	)
Net loss per share - (basic and diluted)	$	(0.01	)	$	(0.00	)
Weighted average shares oustanding - (basic and diluted)		245,420,970			157,000,000