6. COMMON STOCK

12 Months Ended

Dec. 31, 2015

Equity [Abstract]

COMMON STOCK

At December 31, 2015, the Company's authorized capital stock was 150,000,000 shares of common stock, par value $0.001 per share, and 10,000,000 shares of preferred stock, par value $0.001 per share. On that date, the Company had outstanding 42,510,765 shares of common stock, and no shares of preferred stock.

2015 Transactions: During the year ended December 31, 2015, the Company issued shares of common stock as follows:

· 629,159 shares of common stock issued for various services valued at $202,550.

· 212,500 shares of common stock issued for prior services which had previously been recorded as an accrued liability totaling $67,914 in 2014.

· 5,000,000 shares of common stock issued related to previously recorded stock payable for $680,000 in 2014.

At December 31, 2014, the Company's authorized capital stock was 150,000,000 shares of common stock, par value $0.001 per share, and 10,000,000 shares of preferred stock, par value $0.001 per share. On that date, the Company had outstanding 36,669,106 shares of common stock, and no shares of preferred stock.

2014 Transactions: During the year ended December 31, 2014, the Company issued and cancelled shares of common stock as follows:

· 100,000 shares of common stock for an employee contract bonus valued at $0.15 per share.

· 75,000 shares of common stock for an employee contract bonus valued at $0.26 per share, including a 15% discount of fair market value due to these shares being restricted and lacking market liquidity.

· 2,442,000 shares of common stock were acquired through a debt settlement and retired, see Note 4 for additional discussions.

Warrants:

As of December 31, 2015, warrants outstanding consisted of the following:

Date of Issuance or Declaration	Number of Warrants		Exercise Price		Contractual Life	Number of Shares Exercisable
March 18, 2015		200,000		0.25	3 years		200,000
September 10, 2014		150,000		0.25	3 years		150,000
September 10, 2014		150,000		0.50	3 years		150,000
September 18, 2014		200,000		0.25	3 years		200,000
November 05, 2014		100,000		0.50	3 years		100,000
		800,000					800,000

Stock and Warrant Grants:

In March 2015, the Company granted 200,000 shares of common stock along with 200,000 warrants to a consultant. The shares were valued at $30,600 or $0.16 per share (including a 15% discount of fair market value due to these shares being restricted and lacking market liquidity). The warrants were valued at $34,611, using the Black-Scholes options pricing model under the following assumptions: stock price at issuance of $0.18 per share; exercise price of $0.25; 3 year life; discount rate of 2.00%; and volatility rate of 245%. The 200,000 shares and 200,000 warrants granted have a vesting period of six months of which seven months had vested as of December 31, 2015. As of December 31, 2015, the 200,000 shares have not been issued but the warrant for 200,000 shares were granted.

In August 2014, the Company granted 150,000 shares of common stock to a consultant with a total value of $25,500 or $0.17 per share (including a 15% discount of fair market value due to these shares being restricted and lacking market liquidity). The 150,000 shares granted have a vesting period of three years of which five and seventeen months had vested as of December 31, 2014. The approximate value vested for the years ended December 31, 2014 and 2015 was $3,500 and $12,000, for which a payable has been recorded for the same vested amount as of December 31, 2014 and 2015. As of December 31, 2015, 100,000 shares have been issued.

In September 2014, the Company granted 150,000 shares of common stock along with 150,000 Class A warrants and 150,000 Class B warrants to an advisory board member. The shares were valued at $19,125 or $0.13 per share (including a 15% discount of fair market value due to these shares being restricted and lacking market liquidity. The warrants were valued at $42,761, using the Black-Scholes options pricing model under the following assumptions: stock price at issuance of $0.15 per share; exercise price of $0.25 for the Class A warrants and $0.50 for the Class B warrants; 3 year life; discount rate of 2.00 %; and volatility rate of 245%. The 150,000 shares and 300,000 warrants granted vest over a 3 year period, at 50,000 shares and 100,000 warrants per year of which four and sixteen months had vested as of December 31, 2014 and 2015, respectively. The approximate value vested for the years ended December 31, 2014 and 2015 was $6,400 and $27,000, for which a payable has been recorded for the same vested amount as of December 31, 2014 and 2015. As of December 31, 2015, none of the 150,000 shares or 300,000 warrants have been issued or granted.

In September 2014, the Company granted 200,000 shares of common stock along with 200,000 warrants to a consultant. The shares were valued at $30,600 or $0.16 per share (including a 15% discount of fair market value due to these shares being restricted and lacking market liquidity). The warrants were valued at $34,611, using the Black-Scholes options pricing model under the following assumptions: stock price at issuance of $0.18 per share; exercise price of $0.25; 3 year life; discount rate of 2.00%; and volatility rate of 245%. The 200,000 shares and 200,000 warrants granted have a vesting period of six months of which four months had vested as of December 31, 2014. The approximate value vested for the year ended December 31, 2014 was $37,000, for which a payable has been recorded for the same vested amount as of December 31, 2014. As of December 31, 2015, the 200,000 shares and 200,000 warrants had been issued and granted.

In October 2014, the Company granted 150,000 shares of common stock to an advisory board member with a total value of $32,400 or $0.21 per share (including a 10% discount of fair market value due to these shares being restricted and lacking market liquidity). The 150,000 shares granted will vest over a 3 year period, at 50,000 shares per year of which three and fifteen months had vested as of December 31, 2014 and 2015, respectively. The approximate value vested for the year ended December 31, 2014 and 2015 was $2,200 and $13,000, respectively, for which a payable has been recorded for the same vested amount as of December 31, 2014 and 2015. As of December 31, 2015, 50,000 shares of the 150,000 shares granted have been issued.

In November 2014, the Company had granted a warrant for 100,000 shares of common stock as part of debt settlement (see Note 4) whereby the noteholder returned 2,442,000 shares of the Company's common stock in satisfaction of both principal and interest of the note. The warrant has an exercise price of $0.50 and life of three years.

In October 2013, the Company granted 300,000 shares of common stock to an employee of the Company with a total value of $38,250 or $0.13 per share (including a 15% discount of fair market value due to these shares being restricted and lacking market liquidity). The 300,000 shares granted have a vesting period of three years of which fourteen and twenty-six months had vested as of December 31, 2014 and 2015, respectively. The approximate value vested for the years ended December 31, 2014 and 2015 were $12,750 and $12,750, for which a payable has been recorded for the same vested amounts as of December 31, 2014 and 2015. As of December 31, 2015, none of the 300,000 shares granted have been issued.

In August 2012, the Company granted a total of 5,000,000 shares of common stock to various officers and directors of the Company with a total value of $680,000 or $0.14 per share (including a 15% discount of fair market value due to these shares being restricted and lacking market liquidity). The 5,000,000 shares granted originally had a vesting period of five years; however, the Company’s board accelerated the vesting period in 2014. The approximate value vested for the years ended December 31, 2014, 2013 and 2012 were $492,000, $136,000 and $52,000 respectively, for a total of $680,000 for which a payable was recorded for the same vested amount as of December 31, 2014. During 2015, the 5,000,000 shares granted were issued.