GOING CONCERN

6 Months Ended

Jun. 30, 2011

Notes to Financial Statements

Note 4- GOING CONCERN

As reflected in the accompanying consolidated financial statements, the Company has an accumulated deficit of $21,954,058 at June 30, 2011 that includes a loss of $504,409 for the six months ended June 30, 2011 and a loss of $1,007,604 for the year ended December 31, 2010 and a working capital deficiency of $14,748,848 at June 30, 2011.  These factors raise substantial doubt about the Company's ability to continue as a going concern.

Management has taken steps to revise the Company's operating and financial requirements.  The Company is actively pursuing additional funding and a potential merger or acquisition candidate and strategic partners, which would enhance owners' investment.  However, there can be no assurance that sufficient funds required during the next year or thereafter will be generated from operations or that funds will be available from external sources such as debt or equity financings or other potential sources. The lack of additional capital resulting from the inability to generate cash flow from operations or to raise capital from external sources would force the Company to substantially curtail or cease operations and would, therefore, have a material adverse effect on its business. Furthermore, there can be no assurance that any such required funds, if available, will be available on attractive terms or that they will not have a significant dilutive effect on the Company's existing stockholders.

The accompanying financial statements do not include any adjustments related to the recoverability or classification of asset-carrying amounts or the amounts and classification of liabilities that may result should the Company be unable to continue as a going concern.

The Company relied heavily for its financing needs on its affiliates, shareholders/directors as more fully disclosed in Note 12. On July 1, 2011, the related parties contributed their outstanding debt to paid-in capital, see Note 19.