NOTES AND INTEREST RECEIVABLE

9 Months Ended

Sep. 30, 2014

NOTES AND INTEREST RECEIVABLE [Abstract]

NOTES AND INTEREST RECEIVABLE

NOTE 8 – NOTES AND INTEREST RECEIVABLE

Notes Receivable

On August 13, 2014, in conjunction with the $1,657,500 Typenex Co-Investment, LLC (“Typenex”) convertible promissory note more fully described in Note 12 below, we received five, unsecured, $250,000 Investor Notes bearing interest at 8% per annum, totaling $1,250,000 that mature with respect to principal and interest on September 13, 2016. The Investor Notes can be prepaid at any time, without penalty, by Typenex and Typenex has certain rights to offset the amounts owed to us by amounts we owe to them in accordance with the terms of the Investor Notes. We have the right to call the Investor Notes if the share price of our common stock (as further defined in the Investor Notes terms and conditions) exceeds $6.00 per share for 20 consecutive trading days.

Our intention in entering into this arrangement with Typenex is that the Investor Notes will provide us with a mechanism to obtain additional cash funding. Upon our request and with Typenex's consent, we can redeem individual Investor Notes for cash before meeting the price threshold of $6.00 per share for 20 consecutive days at which point we have the right to demand repayment of these Investor Notes from Typenex without requiring their consent.

During the three and nine months ended September 30, 2014, we recognized $13,150 of interest income applicable to these Investor Notes and this amount is included in notes and interest receivable on our condensed balance sheets.