8. STOCK BASED COMPENSATION

3 Months Ended

Mar. 31, 2013

Accounting Policies [Abstract]

8. STOCK BASED COMPENSATION

8. STOCK BASED COMPENSATION

During the periods ended March 31, 2013 and 2012 the Company issued stock in payment of services and debts as follows:

For the three month period ended March 31, 2013 the Board authorized the issuance of 1,000,000 shares of common stock in payment of services amounting to $30,000. In addition 1,500,000 shares were issued in payment of loans in the amount of $7,500. In both instances, although authorized prior to March 31, 2013 the shares were not issued until April 2013.

For the three month period ended March 31, 2012 3,000,000 shares of common stock were issued in payments of accounts payable amounting to $28,500. In addition 3,000,000 shares were issued in payment of loans in the amount of $15,000.

Independent contractors and consultants’ expense was based on the value of services rendered or the value of the common stock issued, if more reliably determined.

Stock Options and Warrants

On April 2, 2010, the Company adopted its 2010 Equity Incentive Plan, which authorized, among other forms of incentives, the issuance of stock options. Reserved for equity issuances under the 2010 Equity Incentive Plan are 50,000,000 shares of our common stock. No equity issuances have been made from the 2010 Equity Incentive Plan. Stock options, which may be tax qualified and non-qualified, are exercisable for a period of up to ten years at prices at or above market prices as established on the date of the grant.

Stock Options

Certain nonqualified stock options were issued during the three months ending March 31, 2013 to a member of the board of directors as compensation for services performed.

	Number of Options		Weighted Average Exercise Price	Weighted Average Remaining Contractual Life		Aggregate Intrinsic Value
Outstanding at January 1, 2013	—		—	—		—
Granted	15,000,000	$	0.03	4.92	$	—
Exercised	—		—	—		—
Forfeited	—		—	—		—
Outstanding at March 31, 2013	15,000,000	$	0.03	4.92	$	—
Exercisable at March 31, 2013	15,000,000	$	0.03	4.92	$	—

The Company uses the Black-Scholes option pricing model to calculate the fair value of options. Significant assumptions used in this model include:

	Three Months Ended March 31
	2013		2012
Annual Dividend	—		NA
Expected Life (in years)	5.00		NA
Risk Free Interest Rate	0.78	%	NA
Expected Volatility	325.25	%	NA

The 15,000,000 options granted for the three months ended March 31, 2013 had a weighted average grant date fair value of $0.03.