FAIR VALUE MEASUREMENTS AND FINANCIAL INSTRUMENTS (Tables)

12 Months Ended

Dec. 31, 2013

FAIR VALUE MEASUREMENTS AND FINANCIAL INSTRUMENTS [Abstract]

Liabilities Measured at Fair Value on a Recurring Basis

Liabilities measured at fair value on a recurring basis are summarized as follows:

	Fair value measurement using inputs				Carrying amount
	Level 1	Level 2		Level 3	December 31, 2013		December 31, 2012
Financial instruments:
Warrant derivative		$	950,000		$	950,000	$	1,945,000
PIK Note derivative		$	2,250,000		$	2,250,000		--

Schedule of Valuation Assumptions

For the Company's warrant and PIK note derivative liabilities, fair value was estimated using a Binomial Lattice Model and monte carlo model using the following assumptions:

Warrant derivative liability	Fair Value Measurements
	Using Inputs
	December 31, 2013			December 31, 2012
Market price and estimated fair value of stock	$	1.10		$	1.54
Exercise price	$	1.93		$	2.00
Term (years)		3			4
Dividend yield	$	--		$	--
Expected volatility		76.90	%		83.3	%
Risk-free interest rate		0.78	%		0.54	%

PIK Note derivative liability	Fair Value Measurements
	Using Inputs
	December 31, 2013			December 31, 2012
Market price and estimated fair value of stock	$	1.10			--
Exercise price	$	1.40			--
Term (years)		9.58			--
Dividend yield	$	--			--
Expected volatility		76.90	%		--
Risk-free interest rate		2.96	%		--