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Annual report pursuant to section 13 and 15(d)

CONSOLIDATED BALANCE SHEETS

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CONSOLIDATED BALANCE SHEETS (USD $)
Dec. 31, 2012
Dec. 31, 2011
Assets    
Cash and cash equivalents $ 644,988 $ 766,602
Restricted cash 264,992   
Accounts receivable, net of allowance of $204,580 and $47,595, respectively 561,697 847,234
Accounts receivable, secured - related party    772,793
Note receivable from officer, secured - related party    150,000
Prepaid expenses 192,533 103,268
Other current assets 72,438 210
Total current assets 1,736,648 2,640,107
Call center equipment 121,313 121,313
Computer and office equipment 45,718 38,577
Furniture and fixtures 11,336   
Library (online) 100,000 100,000
Software 1,388,824 927,455
Vehicle    39,736
Total 1,667,191 1,227,081
Less accumulated depreciation and amortization (455,871) 229,972
Total property and equipment, net 1,211,320 997,109
Courseware, net 253,571 369,831
Accounts receivable, secured - related party, net of allowance of $502,315 and $0, respectively 270,478   
Other assets 25,181 6,559
Total assets 3,497,198 4,013,606
Liabilities and Stockholders' Equity (Deficiency)    
Accounts payable 216,974 1,094,029
Accrued expenses 261,307 167,528
Deferred revenue 1,076,397 835,694
Notes payable, current portion    6,383
Loan payable to stockholder 491   
Deferred rent, current portion 6,257 4,291
Other current liabilities 69,000   
Total current liabilities 1,630,426 2,107,925
Line of credit 250,000 233,215
Loans payable (includes $50,000 to related parties)    200,000
Convertible notes payable (includes $650,000 to related parties) 800,000   
Notes payable    8,768
Deferred rent 15,017 21,274
Total liabilities 2,695,443 2,571,182
Commitments and contingencies - See Note 10      
Temporary equity:    
Series A preferred stock, $0.001 par value; 850,500 shares designated, none and 850,395 shares issued and outstanding, respectively    809,900
Series D preferred stock, $0.001 par value; 3,700,000 shares designated, none and 1,176,750 shares issued and outstanding, respectively (liquidation value of $1,176,750)    1,109,268
Series E preferred stock, $0.001 par value; 2,000,000 shares designated, none and 1,700,000 shares issued and outstanding, respectively (liquidation value of $1,700,000)    1,550,817
Total temporary equity    3,469,985
Stockholders' equity:    
Preferred stock, $0.001 par value; 20,000,000 shares authorized      
Series C preferred stock, $0.001 par value; 11,411,400 shares designated, none and 11,307,450 shares issued and outstanding, respectively (liquidation value of $11,307)    11,307
Series B preferred stock, $0.001 par value; 368,421 shares designated, none and 368,411 shares issued and outstanding, respectively    368
Common stock, $0.001 par value; 120,000,000 shares authorized, 35,275,204 and 11,837,930 issued and outstanding, respectively 55,244 11,838
Additional paid-in capital 12,153,615 3,275,296
Treasury stock (200,000 shares) (70,000)   
Accumulated deficit (11,337,104) (5,326,370)
Total stockholders' equity 801,755 (2,027,561)
Total liabilities and stockholders' equity $ 3,497,198 $ 4,013,606