10. COMMON STOCK

9 Months Ended

Sep. 30, 2016

Equity [Abstract]

COMMON STOCK

Stock Issued in Cash Sales

During the nine months ended September 30, 2016 pursuant to private placements, the Company issued 9,800,000 shares of common stock for cash with a per share price of $0.15 per share or $1,470,000 and the Company incurred $44,800 of capital raising fees that were paid in cash and charged to additional paid-in-capital. Additionally, the Company is obligated to issue 191,667 warrants as an offering cost to a third party, each with a 5 year term and a strike price of $0.15 per share, at the close of the private placement offering.  There will be no accounting effect for the issuance of these warrants as their fair value will be charged to additional paid-in-capital as an offering cost and offset by a credit to additional paid-in-capital for their fair value when issuing these warrants (See Note 12).

Stock Issued for Services

During the nine months ended September 30, 2016, as partial payment for professional services provided by GreenCore, the Company issued 464,115 shares of the Company’s common stock with a per share fair value of $0.15 (based on contemporaneous cash sales prices) or $69,604 and expensed the payment at issuance. The Company recorded a gain on debt settlement of $2,396 on these transactions. Jay Potter, our director, is the managing member of GreenCore and the primary individual performing the services (See Note 12).

Effective July 2016, the Company entered into an investor relations consulting agreement with LP Funding, LLC whereby the consultant will provide various investor recognition services to the Company. The agreement calls for two payments of 500,000 shares of the Company’s common stock, with a per share value of $0.15 (based on contemporaneous cash sales prices) or a total of $150,000. The payments are contractually defined to be earned on a specific day and will be expensed over the term of the agreement. During the nine months ended September 30, 2016, the Company released 500,000 shares of common stock and recorded $75,000 of expense under this agreement (See Note 13).

New Director

On February 19, 2016, Mr. Anthony Posawatz accepted an appointed as a new director of the Company effective February 19, 2016. In consideration for Mr. Posawatz’s acceptance to serve as a director of the Company, the Company agreed to grant him 1,000,000 restricted shares of its common stock, with a per share value of $0.15 (based on contemporaneous cash sales prices), or $150,000, vesting according to the following vesting schedule: 27,777 per month over a 36 month period commencing on March 31, 2016, issuable on the last day of each calendar quarter so long as Mr. Posawatz serves as a director of the Company, subject to the grantee’s right to waive vesting and issuance on a quarterly basis. The share issuances will be proportionally expensed during the period in which they vest. During the nine months ended September 30, 2016, the Company released 222,222 shares of common stock valued at $33,333 under this agreement (See Note 12).

On September 8, 2016, Mr. Peter W. Davidson accepted an appointment as a new director of the Company, effective September 8, 2016. In consideration for Mr. Davidson’s acceptance to serve as a director of the Company, the Company agreed to grant 750,000 restricted shares of its common stock, with a per share value of $0.15 (based on contemporaneous cash sales prices), or $112,500, to Mr. Davidson, vesting according to the following vesting schedule: 62,500 shares or pro rata portion thereof per calendar quarter over a 36 month period commencing on September 30, 2016, issuable on the last day of each calendar quarter so long as Mr. Davidson serves as a director of the Company, provided, that the first vesting is scheduled to occur on September 30, 2016 and be for 62,500 shares. The Company intends to grant up to an additional 750,000 restricted shares of its common stock to Mr. Davidson based on Mr. Davidson achieving certain performance criteria to be agreed upon by the Board of Directors after discussion with senior management at a future date. During the nine months ended September 30, 2016, the Company released 62,500 shares of common stock valued at $9,375 under this agreement (See Note 12).

Director Compensation

On February 12, 2016, the Board approved a compensation program for all non executive directors that do not otherwise have a pre-existing compensation plan.  Starting for the 2016 year of service, each of the two directors received 1,000,000 shares of common stock, with a per share value of $0.15 (based on contemporaneous cash sales prices), or $150,000, that will vest equally at the end of each calendar quarter that such director remains in service as a director over a three year period. The share issuances will be proportionally expensed during the period in which they vest.

During the nine months ended September 30, 2016, the Company released 638,886 shares of common stock valued at $95,833 to three directors under their respective agreements (See Note 12).