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<p style="margin: 0pt"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>NOTE 1.    BASIS
OF PRESENTATION AND ORGANIZATION</b></p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b><i>Current Operations and Background</i></b>
— </p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">DigiPath, Inc. (“DigiPath®,”
the “Company,” “we,” “our” or “us”) was incorporated in Nevada on October 5, 2010.
During January, 2011, the Company no longer was considered a development stage company as it began recognizing revenue for its
advisory services to a handful of healthcare clients.</p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">DigiPath, Inc. provides the next
generation of affordable, innovative, and reliable digital pathology solutions and advisory services for clients involved within
healthcare. Services range the full breadth of management operations for marketing, product development, sales, outreach, operations,
customer service, regulatory, and financial. Clients include Manufacturer (hardware and software), Distribution & Service Firms,
Laboratories (reference, hospital owned, independent), Private Pathology Practices (associated with hospitals), and Centers of
Excellence.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"><b><i>Basis of Presentation </i></b>–</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">The accompanying financial statements
have been prepared in accordance with generally accepted accounting principles (“GAAP”) as promulgated in the United
States of America.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"><b> </b></p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"><b><i>Going Concern</i> – </b></p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">The accompanying financial statements
have been prepared assuming that the Company will continue as a going concern. As reflected in the accompanying financial statements,
the Company had a negative working capital of $548,636 and a deficit accumulated of $682,887 at September 30, 2013.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">While the Company is attempting to generate
revenues from services or software products, the Company’s cash position may not be significant enough to support the Company’s
daily operations. Management believes that the actions presently being taken to further implement its business plan and generate
additional products and revenues provide the opportunity for the Company to continue as a going concern. While the Company believes
in the viability of its strategy to realize revenues and in its ability to raise additional funds, there can be no assurances to
that effect. The Company’s ability to continue as a going concern is dependent upon its ability to achieve profitable operations
or obtain adequate financing.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">The financial statements do not include
any adjustments that might be necessary if the Company is unable to continue as a going concern.</p>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"> </p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b>NOTE 2 – SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES</b></p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b><i>Use of Estimates –</i></b></p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">The preparation of financial statements
in conformity with accounting principles generally accepted in the United States of America requires management to make estimates
and assumptions that may affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities
at the date of the condensed financial statements and the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from these estimates.</p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b><i>Income Taxes –</i></b></p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">The Company accounts for income
taxes in accordance with ASC 740, Income Taxes ("ASC 740"), which requires the recognition of deferred tax liabilities and assets
at currently enacted tax rates for the expected future tax consequences of events that have been included in the financial statements
or tax returns. A valuation allowance is recognized to reduce the net deferred tax asset to an amount that is more likely than
not to be realized. </p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt"> </p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">ASC 740 provides guidance on the
accounting for uncertainty in income taxes recognized in a company's financial statements. ASC 740 requires a company to determine
whether it is more likely than not that a tax position will be sustained upon examination based upon the technical merits of the
position. If the more-likely-than-not threshold is met, a company must measure the tax position to determine the amount to recognize
in the financial statements.</p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">The Company performed a review
of its material tax positions. During the period from October 5, 2010 through September 30, 2013, there were no increases or decreases
in unrecognized tax benefits as a result of tax positions taken during period, there were no decreases in unrecognized tax benefits
relating to settlements with taxing authorities, and there were no reductions to unrecognized tax benefits as a result of a lapse
of the applicable statute of limitations. As of September 30, 2013, the Company had no unrecognized tax benefits that, if recognized,
would affect the effective tax rate. As of September 30, 2013, the Company had no tax positions for which it is reasonably possible
that the total amounts of unrecognized tax benefits will significantly increase or decrease within 12 months of the reporting date.</p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">The Company has elected to classify
any interest or penalties recognized with respect to any unrecognized tax benefits as income taxes. During the period from October
5, 2010 through September 30, 2013, the Company did not recognize any amounts for interest or penalties with respect to any unrecognized
tax benefits. As of September 30, 2013, no amounts for interest or penalties with respect to any unrecognized tax benefits have
been accrued.</p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b><i>Cash and cash equivalents
–</i></b></p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">Cash and cash equivalents includes
all highly liquid instruments with an original maturity of three months or less. The Company had no cash equivalents as of September
30, 2013 and September 30, 2012.</p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b><i>Accounts Receivable –</i></b></p>
<p style="font: 11pt/115% Calibri, Helvetica, Sans-Serif; margin: 0 0 10pt; text-align: justify"><font style="font: 10pt/115% Times New Roman, Times, Serif">Accounts
receivable are carried at their estimated collectible amounts. Trade accounts receivable are periodically evaluated for collectability
based on past credit history with customers and their current financial condition.</font> <font style="font: 10pt/115% Times New Roman, Times, Serif">The
Company has no allowance for doubtful accounts as of September 30, 2013 and September, 2012.</font></p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0"><b><i>Fair Value of Financial Instruments –</i></b></p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">The Company adopted ASC 820, Fair
Value Measurements and Disclosures (ASC 820). ASC 820 defines fair value, establishes a three-level valuation hierarchy for disclosures
of fair value measurement and enhances disclosure requirements for fair value measures. The three levels are defined as follows:</p>
<table cellspacing="0" cellpadding="0" style="font-size: 10pt; line-height: normal; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal">
<tr style="vertical-align: top">
<td style="width: 5%; padding-right: 0.8pt; padding-bottom: 10pt; padding-left: 0.25in"> </td>
<td style="width: 95%; text-align: justify; line-height: 115%; padding-right: 103.5pt; padding-left: 0.25in; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.</font></td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 0.8pt; padding-bottom: 10pt; padding-left: 0.25in"> </td>
<td style="text-align: justify; line-height: 115%; padding-right: 1.5in; padding-left: 0.25in; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.</font></td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 0.8pt; padding-bottom: 10pt; padding-left: 0.25in"> </td>
<td style="text-align: justify; line-height: 115%; padding-right: 0.8pt; padding-left: 0.25in; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">Level 3 inputs to valuation methodology are unobservable and significant to the fair measurement.</font></td></tr>
</table>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">The Company had no such assets
or liabilities recorded to be valued on the basis above at September 30, 2013 and 2012.</p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt"><b><i> </i></b></p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b><i>Equipment</i></b><i> -</i></p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">Equipment is stated at cost less
accumulated depreciation. Cost represents the purchase price of the asset and other costs incurred to bring the asset into its
existing use. Depreciation is provided on a straight-line basis over the assets' estimated useful lives. The useful lives are as
follows: machinery 2 to 5 years and trade show booths 3 to 5 years. Maintenance or repairs are charged to expense as incurred.
Upon sale or disposition, the historically recorded asset cost and accumulated depreciation are removed from the accounts and the
net amount less proceeds from disposal is charged or credited to other income / expense.</p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b><i>Inventory</i></b></p>
<p style="font: 11pt/115% Calibri, Helvetica, Sans-Serif; margin: 0 0 10pt; text-align: justify"><font style="font: 10pt/115% Times New Roman, Times, Serif">Inventory
is valued at the lower of cost or market. Cost is determined on a first-in, first-out method.</font> <font style="font: 10pt/115% Times New Roman, Times, Serif">The
Company has no allowance for inventory reserves as of September 30, 2013 and September, 2012.</font></p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b><i>Revenue Recognition</i></b><i>
–</i></p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">The Company recognizes revenue
in accordance with ASC 605, Revenue Recognition, (ASC 605). ASC 605 requires that four basic criteria must be met before revenue
can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services rendered; (3) the fee
is fixed and determinable; and (4) collectability is reasonably assured. This occurs when the services for our advisory services
are completed in accordance with the contracts we have with healthcare clients. In connection with our services arrangements, we
are paid in advance for services which are incurred. These amounts are classified as deferred revenue and amortized over the over
term of the agreement.</p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b><i>Net Loss per Share –</i></b></p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">Basic loss per share is computed
by dividing the net loss applicable to common shareholders by the weighted average number of shares of common stock outstanding
for the period. Diluted loss per share is computed by dividing the loss applicable to common shareholders by the weighted average
number of common shares outstanding plus the number of additional common shares that would have been outstanding if all dilutive
potential common shares had been issued, using the treasury stock method. The Company currently has no dilutive securities and
as such, basic and diluted loss per share are the same for the period presented.</p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b><i>Stock Compensation for Services
Rendered –</i></b></p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">The Company accounts for equity
instruments issued to non-employees in accordance with the provisions of ASC 718 Stock Compensation (ASC 718) and ASC 505-50, Equity,
Equity-Based Payments to Non-employees (ASC 505-50). All transactions in which goods or services are the consideration received
for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value
of the equity instrument issued, whichever is more reliably measurable. The measurement date of the fair value of the equity instrument
issued is the earlier of the date on which the counterparty's performance is complete or the date on which it is probable that
performance will occur.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"><b><i>Recently Accounting Guidance Not
Yet Adopted -</i></b></p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">In April 2013, the FASB issued ASU No.
2013-07, Presentation of Financial Statements (Top 205): Liquidation Basis of Accounting. The objective of ASU No. 2013-07 is to
clarify when an entity should apply the liquidation basis of accounting and to provide principles for the measurement of assets
and liabilities under the liquidation basis of accounting, as well as any required disclosures. The amendments in this standard
is effective prospectively for entities that determine liquidation is imminent during annual reporting periods beginning after
December 15, 2013, and interim reporting periods therein. We are evaluating the effect, if any, adoption of ASU No. 2013-07 will
have on our financial statements. </p>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"> </p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b><i>Use of Estimates –</i></b></p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">The preparation of financial statements
in conformity with accounting principles generally accepted in the United States of America requires management to make estimates
and assumptions that may affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities
at the date of the condensed financial statements and the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from these estimates.</p>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"> </p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b><i>Income Taxes –</i></b></p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">The Company accounts for income
taxes in accordance with ASC 740, Income Taxes ("ASC 740"), which requires the recognition of deferred tax liabilities and assets
at currently enacted tax rates for the expected future tax consequences of events that have been included in the financial statements
or tax returns. A valuation allowance is recognized to reduce the net deferred tax asset to an amount that is more likely than
not to be realized. </p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt"> </p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">ASC 740 provides guidance on the
accounting for uncertainty in income taxes recognized in a company's financial statements. ASC 740 requires a company to determine
whether it is more likely than not that a tax position will be sustained upon examination based upon the technical merits of the
position. If the more-likely-than-not threshold is met, a company must measure the tax position to determine the amount to recognize
in the financial statements.</p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">The Company performed a review
of its material tax positions. During the period from October 5, 2010 through September 30, 2013, there were no increases or decreases
in unrecognized tax benefits as a result of tax positions taken during period, there were no decreases in unrecognized tax benefits
relating to settlements with taxing authorities, and there were no reductions to unrecognized tax benefits as a result of a lapse
of the applicable statute of limitations. As of September 30, 2013, the Company had no unrecognized tax benefits that, if recognized,
would affect the effective tax rate. As of September 30, 2013, the Company had no tax positions for which it is reasonably possible
that the total amounts of unrecognized tax benefits will significantly increase or decrease within 12 months of the reporting date.</p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">The Company has elected to classify
any interest or penalties recognized with respect to any unrecognized tax benefits as income taxes. During the period from October
5, 2010 through September 30, 2013, the Company did not recognize any amounts for interest or penalties with respect to any unrecognized
tax benefits</p>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"> </p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b><i>Cash and cash equivalents
–</i></b></p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">Cash and cash equivalents includes
all highly liquid instruments with an original maturity of three months or less. The Company had no cash equivalents as of September
30, 2013 and September 30, 2012.</p>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0"><b><i>Fair Value of Financial Instruments –</i></b></p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">The Company adopted ASC 820, Fair
Value Measurements and Disclosures (ASC 820). ASC 820 defines fair value, establishes a three-level valuation hierarchy for disclosures
of fair value measurement and enhances disclosure requirements for fair value measures. The three levels are defined as follows:</p>
<table cellspacing="0" cellpadding="0" style="font-size: 10pt; line-height: normal; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal">
<tr style="vertical-align: top">
<td style="width: 5%; padding-right: 0.8pt; padding-bottom: 10pt; padding-left: 0.25in"> </td>
<td style="width: 95%; text-align: justify; line-height: 115%; padding-right: 103.5pt; padding-left: 0.25in; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.</font></td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 0.8pt; padding-bottom: 10pt; padding-left: 0.25in"> </td>
<td style="text-align: justify; line-height: 115%; padding-right: 1.5in; padding-left: 0.25in; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.</font></td></tr>
<tr style="vertical-align: top">
<td style="padding-right: 0.8pt; padding-bottom: 10pt; padding-left: 0.25in"> </td>
<td style="text-align: justify; line-height: 115%; padding-right: 0.8pt; padding-left: 0.25in; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">Level 3 inputs to valuation methodology are unobservable and significant to the fair measurement.</font></td></tr>
</table>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">The Company had no such assets
or liabilities recorded to be valued on the basis above at September 30, 2013 and 2012.</p>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"> </p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b><i>Equipment</i></b><i> -</i></p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">Equipment is stated at cost less
accumulated depreciation. Cost represents the purchase price of the asset and other costs incurred to bring the asset into its
existing use. Depreciation is provided on a straight-line basis over the assets' estimated useful lives. The useful lives are as
follows: machinery 2 to 5 years and trade show booths 3 to 5 years. Maintenance or repairs are charged to expense as incurred.
Upon sale or disposition, the historically recorded asset cost and accumulated depreciation are removed from the accounts and the
net amount less proceeds from disposal is charged or credited to other income / expense.</p>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"> </p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b><i>Revenue Recognition</i></b><i>
–</i></p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">The Company recognizes revenue
in accordance with ASC 605, Revenue Recognition, (ASC 605). ASC 605 requires that four basic criteria must be met before revenue
can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services rendered; (3) the fee
is fixed and determinable; and (4) collectability is reasonably assured. This occurs when the services for our advisory services
are completed in accordance with the contracts we have with healthcare clients. In connection with our services arrangements, we
are paid in advance for services which are incurred. These amounts are classified as deferred revenue and amortized over the over
term of the agreement.</p>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"> </p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b><i>Net Loss per Share –</i></b></p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">Basic loss per share is computed
by dividing the net loss applicable to common shareholders by the weighted average number of shares of common stock outstanding
for the period. Diluted loss per share is computed by dividing the loss applicable to common shareholders by the weighted average
number of common shares outstanding plus the number of additional common shares that would have been outstanding if all dilutive
potential common shares had been issued, using the treasury stock method. The Company currently has no dilutive securities and
as such, basic and diluted loss per share are the same for the period presented.</p>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"> </p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b><i>Stock Compensation for Services
Rendered –</i></b></p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">The Company accounts for equity
instruments issued to non-employees in accordance with the provisions of ASC 718 Stock Compensation (ASC 718) and ASC 505-50, Equity,
Equity-Based Payments to Non-employees (ASC 505-50). All transactions in which goods or services are the consideration received
for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value
of the equity instrument issued, whichever is more reliably measurable. The measurement date of the fair value of the equity instrument
issued is the earlier of the date on which the counterparty's performance is complete or the date on which it is probable that
performance will occur.</p>
<p style="margin: 0pt"></p>
35420
35420
1714
28925
13359
13359
48779
48779
47065
19854
<p style="margin: 0pt"> </p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b>NOTE 6 – RELATED PARTY
REVOLVING NOTE PAYABLE AND ACCRUED INTEREST</b></p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">On February 14, 2011, DigiPath,
Inc., a Nevada corporation (“Company”), entered into a Revolving Promissory Note (the “Revolving Note”)
with NYX Capital Advisors, Inc. (“NYX”) an entity owned by the Company’s President and Chief Financial Officer.  
Under the terms of the Revolving Note, NYX agreed to advance to the Company, from time to time and at the request of the Company,
amounts up to an aggregate of $500,000 until March 31, 2014.  All advances shall be paid on or before March 31, 2014
and interest shall accrue from the date of any advances on any principal amount withdrawn, and on accrued and unpaid interest thereon,
at the rate of eight percent (8%) per annum, compounded annually.  The Company’s obligations under the Revolving
Note will accelerate upon a bankruptcy event of the Company, any default by the Company of its payment obligations under the Revolving
Note or the breach by the Company of any provision of any material agreement between the Company and the noteholder.  As
of September 30, 2013, the outstanding principal on the Revolving Note was $253,649. As of September 30, 2013, the accrued interest
on the Revolving Note was $40,402.</p>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"> </p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b>NOTE 8 – STOCKHOLDERS’
DEFICIT</b></p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b><i>Common Stock -</i></b> Common
stock consists of $0.001 par value, 50,000,000 shares authorized, 5,536,400 shares issued and outstanding as of September 30, 2013.
On March 23, 2011, the Company completed a private placement offering to certain investors (“Investors”) pursuant to
which the Company sold an aggregate of 286,750 shares of the Company’s common stock resulting in gross proceeds of $28,675
to the Company. In quarter ending March 31, 2012, the Company issued 43,500 shares of its common stock for services received by
an unrelated party for $5,350. In the quarter ending June 30, 2012, the Company issued 40,000 shares of its common stock for $30,000
and 6,150 shares of its common stock for services amounting to $4,265. In the quarter ending December 31, 2012, the Company issued
10,000 shares of its common stock for services amounting to $9,800.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0 0 12pt; text-align: justify">On March 5, 2012, the Company
and Steven Barbee entered into a Restricted Stock Award Agreement under which the Company issued to Mr. Barbee 2,500,000 shares
of DigiPath, Inc. restricted common stock (“Restricted Stock”) for $0.10 per share. Fifty percent of the Restricted
Stock vests on February 14, 2013 and fifty percent of the Restricted Stock vests on February 14, 2014. In the event of Mr. Barbee’s
termination the Restricted Stock shall be forfeited and reacquired by the Company for $0.10 per share. The Company loaned Mr. Barbee
$250,000 to pay for the Restricted Stock through a recourse loan agreement. The loan has an interest rate of 5% and is secured
against the Restricted Stock and all of Mr. Barbee’s assets. The note expires on March 4, 2016.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0">On March 5, 2012, Eric Stoppenhagen, the Company’s
president, cancelled his ownership of 2,500,000 shares of DigiPath, Inc. common stock.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0"><b><i> </i></b></p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b><i>Preferred Stock -</i></b>
The articles of incorporation of the Company authorize 10,000,000 shares of preferred stock with a par value of $0.001 per share.
The Board of Directors is authorized to determine any number of series into which shares of preferred stock may be divided and
to determine the rights, preferences, privileges and restrictions granted to any series of the preferred stock. As of September
30, 2013, no shares of preferred stock were issued.</p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b><i>Stock Incentive Plan</i></b></p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">On March 5, 2012, the action to
adopt our 2012 Stock Incentive Plan (the “2012 Plan”) was approved by written consent of holders representing approximately
91% of the outstanding shares of our common stock. On March 5, 2012, our board of directors approved the 2012 Plan.</p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">The approval of the 2012 Plan required
such board approval and the affirmative vote of a majority of our outstanding shares of common stock. Such requirements have been
met so no vote or further action of our stockholders is required to approve the adoption of the 2012 Plan. Our board of directors
approved the 2012 Plan to ensure that we have adequate ways in which to provide stock based compensation to our directors, officers,
employees and consultants. Our board of directors believes that the ability to grant stock-based compensation, such as stock options
and stock grants, is important to our future success. The grant of such stock-based compensation can motivate high levels of performance
and provide an effective means of recognizing employee and consultant contributions to our success. In addition, stock-based compensation
can be valuable in recruiting and retaining highly qualified technical and other key personnel who are in great demand, as well
as rewarding and providing incentives to our current employees and consultants.</p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">Because awards under the 2012 Plan
are discretionary, benefits or amounts that will hereinafter be received by or allocated to our chief executive officer, our named
executive officers, our current executive officers as a group, our non-executive directors as a group, and our employees who are
not executive officers, are not presently determinable.</p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">The principal terms and features
of the 2012 Plan are summarized below. The following is a summary description of the salient terms, conditions and features of
the 2012 Plan and is qualified by the text of the plan.</p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt"> </p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><i>General; Types of Awards; Number
of Shares</i></p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">The 2012 Plan provides for the
grant of options to purchase shares of common stock, restricted stock, stock appreciation rights (“SARs”) and restricted
stock units (rights to receive, in cash or stock, the market value of one share of our commons stock). Incentive stock options
(“ISOs”) may be granted only to employees. Nonstatutory stock options and other stock-based awards may be granted to
officers, employees, non-employee directors and consultants. A total of 5,000,000 shares of our common stock are reserved for issuance
upon exercise of awards granted under the 2012 Plan. The 2012 Plan will terminate as to grants of awards after 10 years from the
effective date, unless it is terminated earlier by our board of directors.</p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">The 2012 Plan will be administered
by our board of directors or a committee of our board of directors (the “Administrator”) as provided in the 2012 Plan.
The Administrator will have the authority to select the eligible participants to whom awards will be granted, to determine the
types of awards and the number of shares covered and to set the terms, conditions and provisions of such awards, to cancel or suspend
awards under certain conditions, and to accelerate the exercisability of awards. The Administrator will be authorized to interpret
the 2012 Plan, to establish, amend, and rescind any rules and regulations relating to the 2012 Plan, to determine the terms of
agreements entered into with recipients under the 2012 Plan, and to make all other determinations that may be necessary or advisable
for the administration of the 2012 Plan.</p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">Options and other awards may be
granted under the 2012 Plan to directors, officers, employees and consultants of our company and any of our subsidiaries, provided
that the services of such consultants are not in connection with the offer or sale of securities in a capital-raising transaction
and do not directly or indirectly promote or maintain a market for our securities. At the date of this prospectus, all of our officers,
directors and employees would have been eligible to receive awards under the 2012 Plan.</p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">The exercise price per share of
our common stock purchasable upon exercise of any stock option or SAR will be determined by the Administrator, but cannot in any
event be less than 100% of the fair market value of our common stock on the date the award is granted. The Administrator will determine
the term of each stock option or SAR (subject to a maximum term of 10 years) and each option or SAR will be exercisable pursuant
to a vesting schedule determined by the Administrator. The grants and the terms of ISOs will be restricted to the extent required
for qualification as ISOs by the U.S. Internal Revenue Code of 1986, as amended. Subject to approval of the Administrator, options
or SARs may be exercised by payment of the exercise price in cash, shares of common stock or pursuant to a “cashless exercise”
through a broker-dealer under an arrangement approved by the Administrator. The Administrator may require the grantee to pay to
us any applicable withholding taxes that we are required to withhold with respect to the grant or exercise of any option. The withholding
tax may be paid in cash or, subject to applicable law, the Administrator may permit the grantee to satisfy these obligations by
the withholding or delivery of shares of our common stock. We may withhold from any shares of our common stock that may be issued
pursuant to an option or from any cash amounts otherwise due from us to the recipient of the option an amount equal to such taxes.</p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">Restricted shares may be sold or
awarded for consideration determined by the Administrator, including cash, full-recourse promissory notes, as well as past and
future services. Any award of restricted shares will be subject to a vesting schedule determined by the Administrator. Any restricted
shares that are not vested will be subject to rights of repurchase, rights of first refusal or other restrictions as determined
by the Administrator. In general, holders of restricted shares will have the same voting, dividend and other rights as our other
stockholders.</p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt"> </p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">In the event of any change affecting
shares of our common stock by reason of any stock dividend or split, recapitalization, merger, consolidation, spin-off, combination
or exchange of shares or other similar corporate change, or any distribution to stockholders other than cash dividends, the Administrator
will make substitutions or adjustments in the aggregate number of shares that may be distributed under the 2012 Plan, and in the
number and types of shares subject to, and the exercise prices under, outstanding awards granted under the 2012 Plan, in accordance
with Section 10 and other provisions of the 2012 Plan.</p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">Unless otherwise permitted by the
2012 Plan and approved by the Administrator as permitted by the 2012 Plan, no award will be assignable or otherwise transferable
by the grantee other than by will or the laws of descent and distribution and, during the grantee’s lifetime, an award may
be exercised only by the grantee.</p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">Our board of directors may amend
the 2012 Plan in any and all respects without stockholder approval, except as such stockholder approval may be required under applicable
law or pursuant to the listing requirements of any national market system or securities exchange on which our equity securities
may be listed or quoted.</p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify">Unless sooner terminated by our
board of directors, the 2012 Plan will terminate as to further grants of awards on March 5, 2022. Awards under the 2012 Plan will
be made by the Administrator. The Administrator does not currently have plans to grant stock options or other awards to any individual
or group of individuals under the 2012 Plan.</p>
<p style="margin: 0pt"></p>
0.001
6150
5000000
130000
49650
53500
10000
20000
40000
40000
2500000
286750
30000
28675
0.001
0.1
250000
253649
40402
<p style="margin: 0pt"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>NOTE 4 – DEFERRED REVENUE</b></p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">Deferred revenue for the years ended
September 30, 2013 consisted of $164,993 for products yet delivered and $63,955 for accrued software support. Deferred revenue
for the years ended September 30, 2012 consisted of $132,868 for products yet delivered and $35,931 for accrued software support.</p>
<p style="margin: 0pt"></p>
63955
35931
164993
132868
<p style="margin: 0pt"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>NOTE 5 - RELATED PARTIES</b></p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">We have adopted a written policy within
our code of ethics that prohibits our executive officers and directors from entering into a related party transaction with us without
the prior consent of our board of directors. All of our directors, executive officers and employees are required to report any
such related party transaction to our board of directors. As of September 30, 2013, the Company owed Mr. Stoppenhagen,
the President of the Company and Mr. Steven Barbee, a major shareholder of the Company in total of $223,463 and $45,953, respectively,
for expenses and compensation.<b> </b></p>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>NOTE 7 - CONCENTRATION OF CREDIT
RISK</b></p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">We maintain our cash balances in financial
institutions that from time to time exceed amounts insured by the Federal Deposit Insurance Corporation (up to $250,000 per financial
institution as of September 30, 2013). As of September 30, 2013, our deposits did not exceed insured amounts.  We have
not experienced any losses in such accounts and we believe we are not exposed to any significant credit risk on cash.</p>
<p style="margin: 0pt"></p>
15700
0
-546922
5516
331774
-27549
-265950
5427
42248
-353240
20126
0
0
0
5536
380429
0
-250000
-250000
-682887
-15700
0
<p style="margin: 0pt"> </p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b><i>Inventory</i></b></p>
<p style="font: 11pt/115% Calibri, Helvetica, Sans-Serif; margin: 0 0 10pt; text-align: justify"><font style="font: 10pt/115% Times New Roman, Times, Serif">Inventory
is valued at the lower of cost or market. Cost is determined on a first-in, first-out method.</font> <font style="font: 10pt/115% Times New Roman, Times, Serif">The
Company has no allowance for inventory reserves as of September 30, 2013 and September, 2012.</font></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"><b><i>Going Concern</i> – </b></p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">The accompanying financial statements
have been prepared assuming that the Company will continue as a going concern. As reflected in the accompanying financial statements,
the Company had a negative working capital of $548,636 and a deficit accumulated of $682,887 at September 30, 2013.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">While the Company is attempting to generate
revenues from services or software products, the Company’s cash position may not be significant enough to support the Company’s
daily operations. Management believes that the actions presently being taken to further implement its business plan and generate
additional products and revenues provide the opportunity for the Company to continue as a going concern. While the Company believes
in the viability of its strategy to realize revenues and in its ability to raise additional funds, there can be no assurances to
that effect. The Company’s ability to continue as a going concern is dependent upon its ability to achieve profitable operations
or obtain adequate financing.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">The financial statements do not include
any adjustments that might be necessary if the Company is unable to continue as a going concern.</p>
5531386
5472081
0
250000
<p style="margin: 0pt"> </p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b><i>Accounts Receivable –</i></b></p>
<p style="font: 11pt/115% Calibri, Helvetica, Sans-Serif; margin: 0 0 10pt; text-align: justify"><font style="font: 10pt/115% Times New Roman, Times, Serif">Accounts
receivable are carried at their estimated collectible amounts. Trade accounts receivable are periodically evaluated for collectability
based on past credit history with customers and their current financial condition.</font> <font style="font: 10pt/115% Times New Roman, Times, Serif">The
Company has no allowance for doubtful accounts as of September 30, 2013 and September, 2012.</font></p>
<p style="margin: 0pt"></p>
2500000
0
42374
177510
42453
0
30000
56784
-100000
-103424
-63679
5516400
5426750
0
0
0
5536400
0
-2500
2500
0
0
-2500000
0
2500
247500
0
-250000
2500000
30000
40
29960
19800
9615
49
9566
20
19780
-329647
-325691
-325691
-329647
28875
28875
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt; text-align: justify"><b>NOTE 3 – EQUIPMENT</b></p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0">Equipment comprises of the following at September 30, 2013
and September 30, 2012.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0"> </p>
<table cellspacing="0" cellpadding="0" style="font: 10pt/normal Times New Roman, Times, Serif; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal">
<tr style="vertical-align: bottom">
<td> </td>
<td style="font-weight: bold"> </td>
<td colspan="3" style="text-align: center; font-weight: bold">September 30,</td>
<td style="font-weight: bold"> </td>
<td colspan="3" style="text-align: center; font-weight: bold">September 30,</td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1pt; font-weight: bold"> </td>
<td colspan="3" style="text-align: center; font-weight: bold; border-bottom: black 1pt solid">2013</td>
<td style="padding-bottom: 1pt; font-weight: bold"> </td>
<td colspan="3" style="text-align: center; font-weight: bold; border-bottom: black 1pt solid">2012</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)">
<td> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="width: 58%">Machinery</td>
<td style="width: 8%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 11%; text-align: right">35,420</td>
<td style="width: 1%; text-align: left"> </td>
<td style="width: 8%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 11%; text-align: right">35,420</td>
<td style="width: 1%; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)">
<td style="text-align: left; padding-bottom: 1pt">Trade Show Booths</td>
<td style="padding-bottom: 1pt"> </td>
<td style="text-align: left; border-bottom: black 1pt solid"> </td>
<td style="text-align: right; border-bottom: black 1pt solid">13,359</td>
<td style="text-align: left; padding-bottom: 1pt"> </td>
<td style="padding-bottom: 1pt"> </td>
<td style="text-align: left; border-bottom: black 1pt solid"> </td>
<td style="text-align: right; border-bottom: black 1pt solid">13,359</td>
<td style="text-align: left; padding-bottom: 1pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">48,779</td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">48,779</td>
<td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)">
<td style="text-align: left; padding-bottom: 1pt">Less accumulated depreciation</td>
<td style="padding-bottom: 1pt"> </td>
<td style="text-align: left; border-bottom: black 1pt solid"> </td>
<td style="text-align: right; border-bottom: black 1pt solid">(47,065</td>
<td style="text-align: left; padding-bottom: 1pt">)</td>
<td style="padding-bottom: 1pt"> </td>
<td style="text-align: left; border-bottom: black 1pt solid"> </td>
<td style="text-align: right; border-bottom: black 1pt solid">(19,854</td>
<td style="text-align: left; padding-bottom: 1pt">)</td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt">Total</td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="text-align: left; border-bottom: black 2.5pt double">$</td>
<td style="text-align: right; border-bottom: black 2.5pt double">1,714</td>
<td style="text-align: left; padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="text-align: left; border-bottom: black 2.5pt double">$</td>
<td style="text-align: right; border-bottom: black 2.5pt double">28,925</td>
<td style="text-align: left; padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0">For the years ending September 30, 2013 and 2012, depreciation
expense was $27,212 and $33,110, respectively.</p>
<table cellspacing="0" cellpadding="0" style="font: 10pt/normal Times New Roman, Times, Serif; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal">
<tr style="vertical-align: bottom">
<td> </td>
<td style="font-weight: bold"> </td>
<td colspan="3" style="text-align: center; font-weight: bold">September 30,</td>
<td style="font-weight: bold"> </td>
<td colspan="3" style="text-align: center; font-weight: bold">September 30,</td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1pt; font-weight: bold"> </td>
<td colspan="3" style="text-align: center; font-weight: bold; border-bottom: black 1pt solid">2013</td>
<td style="padding-bottom: 1pt; font-weight: bold"> </td>
<td colspan="3" style="text-align: center; font-weight: bold; border-bottom: black 1pt solid">2012</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)">
<td> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="width: 58%">Machinery</td>
<td style="width: 8%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 11%; text-align: right">35,420</td>
<td style="width: 1%; text-align: left"> </td>
<td style="width: 8%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 11%; text-align: right">35,420</td>
<td style="width: 1%; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)">
<td style="text-align: left; padding-bottom: 1pt">Trade Show Booths</td>
<td style="padding-bottom: 1pt"> </td>
<td style="text-align: left; border-bottom: black 1pt solid"> </td>
<td style="text-align: right; border-bottom: black 1pt solid">13,359</td>
<td style="text-align: left; padding-bottom: 1pt"> </td>
<td style="padding-bottom: 1pt"> </td>
<td style="text-align: left; border-bottom: black 1pt solid"> </td>
<td style="text-align: right; border-bottom: black 1pt solid">13,359</td>
<td style="text-align: left; padding-bottom: 1pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">48,779</td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">48,779</td>
<td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)">
<td style="text-align: left; padding-bottom: 1pt">Less accumulated depreciation</td>
<td style="padding-bottom: 1pt"> </td>
<td style="text-align: left; border-bottom: black 1pt solid"> </td>
<td style="text-align: right; border-bottom: black 1pt solid">(47,065</td>
<td style="text-align: left; padding-bottom: 1pt">)</td>
<td style="padding-bottom: 1pt"> </td>
<td style="text-align: left; border-bottom: black 1pt solid"> </td>
<td style="text-align: right; border-bottom: black 1pt solid">(19,854</td>
<td style="text-align: left; padding-bottom: 1pt">)</td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt">Total</td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="text-align: left; border-bottom: black 2.5pt double">$</td>
<td style="text-align: right; border-bottom: black 2.5pt double">1,714</td>
<td style="text-align: left; padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="text-align: left; border-bottom: black 2.5pt double">$</td>
<td style="text-align: right; border-bottom: black 2.5pt double">28,925</td>
<td style="text-align: left; padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="margin: 0pt"></p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>NOTE 9 - STOCK OPTIONS</b></p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">In the quarter ended September 30, 2013,
we granted 62,318 options to purchase shares of our common stock at $0.33 per share. The options vest six months after issuance
and have an expiration period of 3 years. We recorded stock based compensation expense of $28,875 as relates to these options for
the year ended September 30, 2013. The Company assumed all stock options issued during the quarter will vest.  
Though these expenses will result in a deferred tax benefit, we have a full valuation allowance against the deferred tax benefit.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company adopted the detailed method
provided in ASC 718 for calculating the beginning balance of the additional paid-in capital pool (“APIC pool”)
related to the tax effects of employee stock-based compensation, and to determine the subsequent impact on the additional paid
in capital pool and Consolidated Statements of Cash Flows of the income tax effects of employee stock-based compensation awards
that are outstanding.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">The fair value of each stock option
granted is estimated on the grant date using the Black-Scholes option pricing model (“BSOPM”).  The BSOPM
has assumptions for risk free interest rates, dividends, stock volatility and expected life of an option grant.  The
risk free interest rate is based upon market yields for US Treasury debt securities at a 7-year constant maturity.  Dividend
rates are based on the Company’s dividend history.  The stock volatility factor is based on the last 60 days of
market prices prior to the grant date.  The expected life of an option grant is based on management’s estimate.  The
FV of each option grant, as calculated by the BSOPM is recognized as compensation expense on a straight-line basis over the vesting
period of each stock option award.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">These assumptions were used to determine
the fair value of stock options granted using the BSOPM:</p>
<table cellspacing="0" cellpadding="0" style="font-size: 10pt; line-height: normal; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal">
<tr style="vertical-align: bottom">
<td style="line-height: 115%; padding-right: 0.8pt"> </td>
<td style="line-height: 115%; padding-right: 0.8pt"> </td>
<td colspan="2" style="line-height: 115%; padding-right: 1.8pt"> </td>
<td style="line-height: 115%; padding-right: 0.8pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)">
<td style="width: 76%; text-align: justify; line-height: 115%; padding-right: 1.6pt; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">Dividend yield</font></td>
<td style="width: 1%; line-height: 115%; padding-right: 0.8pt"> </td>
<td style="width: 1%; line-height: 115%; padding-right: 0.8pt"> </td>
<td style="width: 21%; text-align: right; line-height: 115%; padding-right: 1.6pt; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">0.0%</font></td>
<td style="width: 1%; text-align: right; line-height: 115%; padding-right: 1.6pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="text-align: justify; line-height: 115%; padding-right: 1.6pt; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">Volatility</font></td>
<td style="line-height: 115%; padding-right: 0.8pt"> </td>
<td style="line-height: 115%; padding-right: 0.8pt"> </td>
<td style="text-align: right; line-height: 115%; padding-right: 1.6pt; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">0%</font></td>
<td style="text-align: right; line-height: 115%; padding-right: 1.6pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)">
<td style="text-align: justify; line-height: 115%; padding-right: 1.6pt; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">Average expected option life</font></td>
<td style="line-height: 115%; padding-right: 0.8pt"> </td>
<td colspan="2" style="text-align: right; line-height: 115%; padding-right: 0.05in; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">3.00 years</font></td>
<td style="text-align: right; line-height: 115%; padding-right: 0.8pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="text-align: justify; line-height: 115%; padding-right: 1.6pt; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">Risk-free interest rate</font></td>
<td style="line-height: 115%; padding-right: 0.8pt"> </td>
<td style="line-height: 115%; padding-right: 0.8pt"> </td>
<td style="text-align: right; line-height: 115%; padding-right: 1.6pt; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">0.81%</font></td>
<td style="text-align: right; line-height: 115%; padding-right: 1.6pt"> </td></tr>
</table>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">The following table summarizes activity
in the Company's stock option grants for the years ended September 30, 2013 and 2012:</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p>
<table cellspacing="0" cellpadding="0" style="font-size: 10pt; line-height: normal; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal">
<tr style="vertical-align: bottom">
<td colspan="3" style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td colspan="3" style="text-align: center; line-height: 115%; border-bottom: black 1pt solid; font-size: 10pt"><font style="font: 10pt/normal Times New Roman, Times, Serif"><b>Number of </b></font><br /><font style="font: 10pt/normal Times New Roman, Times, Serif"><b>Shares</b></font></td>
<td style="line-height: 115%"> </td>
<td colspan="3" style="text-align: center; line-height: 115%; border-bottom: black 1pt solid; font-size: 10pt"><font style="font: 10pt/normal Times New Roman, Times, Serif"><b>Weighted Average Price Per Share</b></font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)">
<td style="width: 1%; line-height: 115%"> </td>
<td style="width: 26%; text-align: right; line-height: 115%; font-size: 10pt"><font style="font: 10pt/normal Times New Roman, Times, Serif">Balance at September 30, 2012</font></td>
<td style="width: 1%; line-height: 115%"> </td>
<td style="width: 8%; line-height: 115%"> </td>
<td style="width: 1%; line-height: 115%"> </td>
<td style="width: 26%; text-align: right; line-height: 115%; font-size: 10pt"><font style="font: 10pt/normal Times New Roman, Times, Serif">-</font></td>
<td style="width: 1%; line-height: 115%"> </td>
<td style="width: 8%; line-height: 115%"> </td>
<td style="width: 1%; line-height: 115%; font-size: 10pt"><font style="font: 10pt/normal Times New Roman, Times, Serif">$</font></td>
<td style="width: 26%; text-align: right; line-height: 115%; font-size: 10pt"><font style="font: 10pt/normal Times New Roman, Times, Serif">-</font></td>
<td style="width: 1%; line-height: 115%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="line-height: 115%"> </td>
<td style="text-align: right; line-height: 115%; font-size: 10pt"><font style="font: 10pt/normal Times New Roman, Times, Serif">Granted</font></td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; border-bottom: black 1pt solid"> </td>
<td style="text-align: right; line-height: 115%; border-bottom: black 1pt solid; font-size: 10pt"><font style="font: 10pt/normal Times New Roman, Times, Serif">62,318</font></td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; border-bottom: black 1pt solid"> </td>
<td style="text-align: right; line-height: 115%; border-bottom: black 1pt solid; font-size: 10pt"><font style="font: 10pt/normal Times New Roman, Times, Serif">0.33</font></td>
<td style="line-height: 115%"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)">
<td style="line-height: 115%"> </td>
<td style="text-align: right; line-height: 115%; font-size: 10pt"><font style="font: 10pt/normal Times New Roman, Times, Serif">Balance at September 30, 2013</font></td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; border-bottom: black 2.25pt double"> </td>
<td style="text-align: right; line-height: 115%; border-bottom: black 2.25pt double; font-size: 10pt"><font style="font: 10pt/normal Times New Roman, Times, Serif">62,318</font></td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; border-bottom: black 2.25pt double; font-size: 10pt"><font style="font: 10pt/normal Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right; line-height: 115%; border-bottom: black 2.25pt double; font-size: 10pt"><font style="font: 10pt/normal Times New Roman, Times, Serif">0.33</font></td>
<td style="line-height: 115%"> </td></tr>
</table>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">The following summarizes pricing and
term information for options issued to employees and directors outstanding as of September 30, 2013:</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p>
<table cellspacing="0" cellpadding="0" style="font-size: 10pt; line-height: normal; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal">
<tr>
<td style="line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td>
<td style="line-height: 115%; padding-right: 0.8pt"> </td>
<td colspan="8" style="text-align: center; line-height: 115%; padding-right: 15.6pt; vertical-align: bottom; border-bottom: black 1.5pt solid; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif"><b>Options Outstanding</b></font></td>
<td style="line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td>
<td colspan="5" style="text-align: center; line-height: 115%; padding-right: 9.6pt; vertical-align: bottom; border-bottom: black 1.5pt solid; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif"><b>Options Exercisable</b></font></td>
<td style="line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td></tr>
<tr>
<td style="text-align: justify; line-height: 115%; padding-right: 1.6pt; vertical-align: bottom; border-bottom: windowtext 1.5pt solid; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif"><b>Range of Exercise Prices</b></font></td>
<td style="line-height: 115%; padding-right: 0.8pt"> </td>
<td colspan="2" style="text-align: center; line-height: 115%; padding-right: 0.05in; vertical-align: bottom; border-bottom: black 1.5pt solid; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif"><b>Number Outstanding at September 30, 2013</b></font></td>
<td style="line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td>
<td colspan="2" style="vertical-align: bottom; border-bottom: black 1.5pt solid">
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0 0.05in 0 0; text-align: center"><b>Weighted Average Remaining
Contractual</b></p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0 0.05in 0 0; text-align: center"><b>Life</b></p></td>
<td style="line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td>
<td colspan="2" style="text-align: center; line-height: 115%; padding-right: 0.05in; vertical-align: bottom; border-bottom: black 1.5pt solid; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif"><b>Weighted Average Exercise Price</b></font></td>
<td style="line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td>
<td colspan="2" style="text-align: center; line-height: 115%; padding-right: 0.05in; vertical-align: bottom; border-bottom: black 1.5pt solid; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif"><b>Number Exercisable at September 30, 2013</b></font></td>
<td style="line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td>
<td colspan="2" style="text-align: center; line-height: 115%; padding-right: 0.05in; vertical-align: bottom; border-bottom: black 1.5pt solid; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif"><b>Weighted Average Exercise Price</b></font></td>
<td style="line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td></tr>
<tr style="background-color: rgb(204, 238, 255)">
<td style="text-align: justify; line-height: 115%; padding-right: 1.6pt; vertical-align: bottom; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">$0.33</font></td>
<td style="line-height: 115%; padding-right: 0.8pt"> </td>
<td style="text-align: right; line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td>
<td style="text-align: right; line-height: 115%; padding-right: 1.6pt; vertical-align: bottom; border-bottom: black 1.5pt solid; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">62,318</font></td>
<td style="text-align: right; line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td>
<td style="text-align: right; line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td>
<td style="text-align: right; line-height: 115%; padding-right: 1.6pt; vertical-align: bottom; border-bottom: black 1.5pt solid; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">3.00</font></td>
<td style="text-align: right; line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td>
<td style="text-align: right; line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td>
<td style="text-align: right; line-height: 115%; padding-right: 1.6pt; vertical-align: bottom; border-bottom: black 1.5pt solid; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">$0.33</font></td>
<td style="text-align: right; line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td>
<td style="text-align: right; line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td>
<td style="text-align: right; line-height: 115%; padding-right: 1.6pt; vertical-align: bottom; border-bottom: black 1.5pt solid; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">-</font></td>
<td style="text-align: right; line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td>
<td style="text-align: right; line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td>
<td style="text-align: right; line-height: 115%; padding-right: 1.6pt; vertical-align: bottom; border-bottom: black 1.5pt solid; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">-</font></td>
<td style="line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td></tr>
<tr style="background-color: white">
<td style="text-align: justify; line-height: 115%; padding-right: 1.6pt; vertical-align: bottom; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">Balance at September 30, 2013</font></td>
<td style="line-height: 115%; padding-right: 0.8pt"> </td>
<td style="text-align: right; line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td>
<td style="text-align: right; line-height: 115%; padding-right: 1.6pt; vertical-align: bottom; border-bottom: windowtext 1.5pt double; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">62,318</font></td>
<td style="text-align: right; line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td>
<td style="text-align: right; line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td>
<td style="text-align: right; line-height: 115%; padding-right: 1.6pt; vertical-align: bottom; border-bottom: windowtext 1.5pt double; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">3.00</font></td>
<td style="text-align: right; line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td>
<td style="text-align: right; line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td>
<td style="text-align: right; line-height: 115%; padding-right: 1.6pt; vertical-align: bottom; border-bottom: windowtext 1.5pt double; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">$0.33</font></td>
<td style="text-align: right; line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td>
<td style="text-align: right; line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td>
<td style="text-align: right; line-height: 115%; padding-right: 1.6pt; vertical-align: bottom; border-bottom: windowtext 1.5pt double; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">-</font></td>
<td style="text-align: right; line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td>
<td style="text-align: right; line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td>
<td style="text-align: right; line-height: 115%; padding-right: 1.6pt; vertical-align: bottom; border-bottom: windowtext 1.5pt double; font-size: 10pt"><font style="font: 10pt/115% Times New Roman, Times, Serif">-</font></td>
<td style="line-height: 115%; padding-right: 0.8pt; vertical-align: bottom"> </td></tr>
</table>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"><b> </b></p>
<p style="margin: 0pt"></p>
62318
28875
0.33
<p style="margin: 0pt"></p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 8.5pt 0 0; text-align: justify"><b>NOTE 10 - INCOME TAX</b></p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">The deferred tax asset as of the year
ended September 30, 2013 and 2012 consisted of the following:</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p>
<table cellspacing="0" cellpadding="0" style="font: 10pt/normal Times New Roman, Times, Serif; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1pt; font-weight: bold"> </td>
<td colspan="3" style="text-align: center; font-weight: bold; border-bottom: black 1pt solid">2013</td>
<td style="padding-bottom: 1pt; font-weight: bold"> </td>
<td colspan="3" style="text-align: center; font-weight: bold; border-bottom: black 1pt solid">2012</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)">
<td style="width: 58%; text-align: justify; padding-left: 5.4pt">Net operating loss carry forwards</td>
<td style="width: 8%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 11%; text-align: right">275,211</td>
<td style="width: 1%; text-align: left"> </td>
<td style="width: 8%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 11%; text-align: right">133,208</td>
<td style="width: 1%; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="text-align: justify; padding-bottom: 1pt; padding-left: 5.4pt">Less valuation allowance</td>
<td style="padding-bottom: 1pt"> </td>
<td style="text-align: left; border-bottom: black 1pt solid"> </td>
<td style="text-align: right; border-bottom: black 1pt solid">(275,211</td>
<td style="text-align: left; padding-bottom: 1pt">)</td>
<td style="padding-bottom: 1pt"> </td>
<td style="text-align: left; border-bottom: black 1pt solid"> </td>
<td style="text-align: right; border-bottom: black 1pt solid">(133,208</td>
<td style="text-align: left; padding-bottom: 1pt">)</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)">
<td style="text-align: justify; padding-bottom: 2.5pt; padding-left: 5.4pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="text-align: left; border-bottom: black 2.5pt double">$</td>
<td style="text-align: right; border-bottom: black 2.5pt double">—  </td>
<td style="text-align: left; padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="text-align: left; border-bottom: black 2.5pt double">$</td>
<td style="text-align: right; border-bottom: black 2.5pt double">—  </td>
<td style="text-align: left; padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 5.4pt"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
</table>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">Management provided a deferred tax asset
valuation allowance equal to the potential benefit due to the Company’s historical net losses. When the Company demonstrates
the ability to generate taxable income, management will re-evaluate the allowance.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">As of September 30, 2013 and 2012, the
Company has net operating loss carry forward of approximately $682,887 and $353,240, respectively, which is available to offset
future taxable income that expires by year 2031.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">Reconciliation between the provision
for income taxes and the expected tax benefit using the federal statutory rate of 34% and state statutory rate of 6.9% for 2013
and 2012 is as follows:</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p>
<table cellspacing="0" cellpadding="0" style="font: 10pt/normal Times New Roman, Times, Serif; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1pt; font-weight: bold"> </td>
<td colspan="3" style="text-align: center; font-weight: bold; border-bottom: black 1pt solid">2013 and 2012</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)">
<td style="width: 71%; text-align: justify; padding-left: 5.4pt">Income tax benefit at federal statutory rate</td>
<td style="width: 10%"> </td>
<td style="width: 1%; text-align: left"> </td>
<td style="width: 17%; text-align: right">-34.00</td>
<td style="width: 1%; text-align: left">%</td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="text-align: justify; padding-left: 5.4pt">State income tax benefit, net of effect on federal taxes</td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">-6.90</td>
<td style="text-align: left">%</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)">
<td style="text-align: justify; padding-bottom: 1pt; padding-left: 5.4pt">Increase in valuation allowance</td>
<td style="padding-bottom: 1pt"> </td>
<td style="text-align: left; border-bottom: black 1pt solid"> </td>
<td style="text-align: right; border-bottom: black 1pt solid">40.90</td>
<td style="text-align: left; padding-bottom: 1pt">%</td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="text-align: justify; padding-bottom: 2.5pt; padding-left: 5.4pt">Income tax expense</td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="text-align: left; border-bottom: black 2.5pt double"> </td>
<td style="text-align: right; border-bottom: black 2.5pt double">—  </td>
<td style="text-align: left; padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)">
<td style="padding-left: 5.4pt"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
</table>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="margin: 0pt"></p>
<table cellspacing="0" cellpadding="0" style="font: 10pt/normal Times New Roman, Times, Serif; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1pt; font-weight: bold"> </td>
<td colspan="3" style="text-align: center; font-weight: bold; border-bottom: black 1pt solid">2013</td>
<td style="padding-bottom: 1pt; font-weight: bold"> </td>
<td colspan="3" style="text-align: center; font-weight: bold; border-bottom: black 1pt solid">2012</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)">
<td style="width: 58%; text-align: justify; padding-left: 5.4pt">Net operating loss carry forwards</td>
<td style="width: 8%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 11%; text-align: right">275,211</td>
<td style="width: 1%; text-align: left"> </td>
<td style="width: 8%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 11%; text-align: right">133,208</td>
<td style="width: 1%; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="text-align: justify; padding-bottom: 1pt; padding-left: 5.4pt">Less valuation allowance</td>
<td style="padding-bottom: 1pt"> </td>
<td style="text-align: left; border-bottom: black 1pt solid"> </td>
<td style="text-align: right; border-bottom: black 1pt solid">(275,211</td>
<td style="text-align: left; padding-bottom: 1pt">)</td>
<td style="padding-bottom: 1pt"> </td>
<td style="text-align: left; border-bottom: black 1pt solid"> </td>
<td style="text-align: right; border-bottom: black 1pt solid">(133,208</td>
<td style="text-align: left; padding-bottom: 1pt">)</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)">
<td style="text-align: justify; padding-bottom: 2.5pt; padding-left: 5.4pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="text-align: left; border-bottom: black 2.5pt double">$</td>
<td style="text-align: right; border-bottom: black 2.5pt double">—  </td>
<td style="text-align: left; padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="text-align: left; border-bottom: black 2.5pt double">$</td>
<td style="text-align: right; border-bottom: black 2.5pt double">—  </td>
<td style="text-align: left; padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 5.4pt"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
</table>
<table cellspacing="0" cellpadding="0" style="font: 10pt/normal Times New Roman, Times, Serif; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1pt; font-weight: bold"> </td>
<td colspan="3" style="text-align: center; font-weight: bold; border-bottom: black 1pt solid">2013 and 2012</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)">
<td style="width: 71%; text-align: justify; padding-left: 5.4pt">Income tax benefit at federal statutory rate</td>
<td style="width: 10%"> </td>
<td style="width: 1%; text-align: left"> </td>
<td style="width: 17%; text-align: right">-34.00</td>
<td style="width: 1%; text-align: left">%</td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="text-align: justify; padding-left: 5.4pt">State income tax benefit, net of effect on federal taxes</td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">-6.90</td>
<td style="text-align: left">%</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)">
<td style="text-align: justify; padding-bottom: 1pt; padding-left: 5.4pt">Increase in valuation allowance</td>
<td style="padding-bottom: 1pt"> </td>
<td style="text-align: left; border-bottom: black 1pt solid"> </td>
<td style="text-align: right; border-bottom: black 1pt solid">40.90</td>
<td style="text-align: left; padding-bottom: 1pt">%</td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="text-align: justify; padding-bottom: 2.5pt; padding-left: 5.4pt">Income tax expense</td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="text-align: left; border-bottom: black 2.5pt double"> </td>
<td style="text-align: right; border-bottom: black 2.5pt double">—  </td>
<td style="text-align: left; padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)">
<td style="padding-left: 5.4pt"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right"> </td>
<td style="text-align: left"> </td></tr>
</table>
275211
133208
-275211
-133208
0
0
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"><b><i>Basis of Presentation </i></b>–</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">The accompanying financial statements
have been prepared in accordance with generally accepted accounting principles (“GAAP”) as promulgated in the United
States of America.</p>