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NOTE 12 - STOCKHOLDERS' DEFICIT
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9 Months Ended |
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Sep. 30, 2014
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| Note 12 - Stockholders Deficit | |
| NOTE 12 - STOCKHOLDERS' DEFICIT |
NOTE 12 – STOCKHOLDERS’ DEFICIT
Common stock issued for cash
On January 4, 2014, the Company received $100,000 which was recorded as a subscription receivable at December 31, 2013 and issued the previously issuable common stock of 8,332,500.
On January 27, 2014, the Company entered into an agreement to issue 5,000,000 shares of Class A common stock at $0.012 per share to one accredited investor in exchange for $60,000. The company received the funds in three equal payments of $20,000 with the final $20,000 received on April 22, 2014. The Company also issued warrants to purchase 3,750,000 shares of Class A common stock at an exercise price of $0.012 per share with this offering.
On February 14, 2014, the Company issued 4,166,250 shares of Class A common stock at $0.012 per share to one accredited investor in exchange for $50,000. The Company also issued warrants to purchase 3,124,688 shares of Class A common stock at an exercise price of $0.012 per share with this offering.
On March 19, 2014, 5,000,000 shares of Class B common stock held by a former officer were converted into Class A common stock subject to a “leak-out” agreement.
Common stock issued for cashless warrant exercise
On February 10, 2014, the Company issued 4,451,087 shares of common stock in connection with the cashless exercise of warrants to purchase 3,750,000 and 4,125,000 shares of the Company’s common stock exercisable at $0.01 per share and based upon the market values of the Company’s common stock of $0.023 per share.
Common stock issued for services
On May 5, 2014, the Company signed a letter of authorization with Hayden IR authorizing the conversion of four past due Hayden IR invoices which totaled $12,000 to be converted into 1,000,000 shares of Class A common stock at a conversion price of $0.012. Based on prior cash sales with warrants, the value of the shares was $0.0068 and a gain was recorded of $5,200. The shares are to be split up amongst Hayden IR and its subsidiary Stratcon Partners.
Conversion of notes payable related parties to common stock On August 1, 2014, the Company converted principal and interest payment of $100,000 into 8,333,333 shares of common stock. No gain or loss on conversion was recorded as the shares were issued at fair market value. In conjunction with the note conversion, the company issued the lender five year warrants to purchase 6,250,000 shares of class A common stock at an exercise price of $0.012. The warrants were valued at a fair value of $77,997 based on using the Black-Scholes pricing model assuming a dividend yield of 0%, an expected volatility of 280%, and a risk free interest rate of 1.65%. The $77,997 is included in interest expense in the accompanying unaudited consolidated financial statements. |