Derivative Liability

9 Months Ended

Sep. 30, 2016

Derivative Liability [Abstract]

DERIVATIVE LIABILITY

NOTE 5 – DERIVATIVE LIABILITY

The convertible notes discussed in Note 3 have a conversion price that is variable based on a percentage of the Company’s stock price which results in this embedded conversion feature being recorded as a derivative liability.

The fair value of the derivative liability is recorded and shown separately under current liabilities. Changes in the fair value of the derivative liability are recorded in the statement of operations under other income (expense).

The Company uses a weighted average Black-Scholes-Merton option-pricing model with the following assumptions to measure the fair value of derivative liability at September 30, 2016:

Stock price	$	0.25
Risk free rate		0.36-0.58	%
Volatility		703	%
Conversion price	$	0.125–0.225
Dividend rate		0	%
Term (years)		0.01 to 1.4

The following table represents the Company’s derivative liability activity for the period ended September 30, 2016:

Derivative liability balance, December 31, 2015	$	50,276
Issuance of derivative liability during the period ended September 30, 2016		366,173
Underlying security converted into common stock		(132,795	)
Change in derivative liability during the period ended September 30, 2016		(105,274	)
Derivative liability balance, September 30, 2016	$	178,380