NOTE 5. EQUITY TRANSACTIONS

3 Months Ended

Mar. 31, 2012

Stockholders' Equity Note Disclosure [Text Block]

NOTE 5.   EQUITY TRANSACTIONS

Issuance of Common Stock

During the three month period ended March 31, 2012, the Company issued an aggregate of 5,995,000,000 shares of common stock to employees for services rendered to the Company. The Company recorded the expense at the fair market value of the shares of $675,000. A total of 4,500,000,000 of the 5,995,000,000 shares of common stock were issued to the Company’s president and CEO for accrued and unpaid salary owed to him. The fair market value of the shares issued to the Company’s president and CEO was $450,000.

The Company issued 600,000,000 shares of common stock for an aggregate amount of $60,000 during the three month period ended March 31, 2012 for payment of consulting or other professional fees. During the three month period ended March 31, 2012, the Company entered into various agreements to convert $30,625 of debt and accrued interest into 705,357,142 shares of common stock. The fair market value of the stock on the dates of agreement and issuances was $141,071. The Company recorded a related loss on settlement of debt of $110,446.

In addition to the above issuances, the Company also issued 3,200,000,000 shares common stock to its president and CEO for payment of outstanding debt.  

Stock Split

A majority of shareholders approved a resolution providing the Company’s Board of Directors with the authority to effect a one-for-twenty-thousand (1:20,000) reverse stock split for stockholders of record as of March 13, 2012.   The reverse split will result in 907,969 shares outstanding.   The reserve split will take effect upon the filing of an amendment to the Company’s Articles of Incorporation with the Secretary of State of California.  The Company is in the process of filing the required documentation. However, the accompanying consolidated financial statements are not effected by reverse stock split.

Stock Options

On February 11, 2008, the Board of Directors adopted the 2008 Equity Incentive Plan (“the Plan”). The Plan provides for the granting of Nonqualified Stock Options, Incentive Stock Options, Stock Appreciation Rights (or SARs), Restricted Stock, Performance Units, and Performance Shares, to our employees, officers, directors, consultants, independent contractors, advisors, or other service providers, provided that such services are not in connection with the offer and sale of securities in a capital-raising transaction. The Company reserved 300,000,000 shares of common stock for awards to be made under the Plan. 299,991,072 shares reserved under this plan have been issued.

On April 29, 2008, the Board of Directors adopted the 2008-2 Equity Incentive Plan (“the Plan”). The Plan provides for the granting of Nonqualified Stock Options, Incentive Stock Options, Stock Appreciation Rights (or SARs), Restricted Stock, Performance Units, and Performance Shares, to our employees, officers, directors, consultants, independent contractors, advisors, or other service providers, provided that such services are not in connection with the offer and sale of securities in a capital-raising transaction. The Company reserved 330,000,000 shares of common stock for awards to be made under the Plan. 326,854,165 of the shares reserved under this plan have been issued.

On July 1, 2008, the Board of Directors adopted the 2008-3 Equity Incentive Plan (“the Plan”). The Plan provides for the granting of Nonqualified Stock Options, Incentive Stock Options, Stock Appreciation Rights (or SARs), Restricted Stock, Performance Units, and Performance Shares, to our employees, officers, directors, consultants, independent contractors, advisors, or other service providers, provided that such services are not in connection with the offer and sale of securities in a capital-raising transaction. The Company reserved 2,500,000 shares of common stock for awards to be made under the Plan. 2,500,000 of the shares reserved under this plan have been issued.

On September 2, 2008, the Board of Directors adopted the 2008-4 Equity Incentive Plan (“the Plan”). The Plan provides for the granting of Nonqualified Stock Options, Incentive Stock Options, Stock Appreciation Rights (or SARs), Restricted Stock, Performance Units, and Performance Shares, to our employees, officers, directors, consultants, independent contractors, advisors, or other service providers, provided that such services are not in connection with the offer and sale of securities in a capital-raising transaction. The Company reserved 3,800,000 shares of common stock for awards to be made under the Plan. 3,800,000 of the shares reserved under this plan have been issued.

On February 15, 2009, the Board of Directors adopted the 2009 Equity Incentive Plan (the “Plan.”) The Plan provides for the granting of the nonqualified Stock Options, Incentive Stock Options, Stock Appreciation Rights (or SARs), Restricted Stock, Performance Units, and Performance Shares, to their employees, officers, directors, consultants, independent contractors, advisors, or other service providers, provided that such services are no it connection with the offer and sale of securities in a capital raising transactions. The company initially reserved 10,000,000 shares of its common stock for awards to be made under the Plan. 10,000,000 of the shares reserved under this plan have been issued.

On May 15, 2009, the Board of Directors adopted the 2009-2 Equity Incentive Plan (The “Plan”.) The Plan provides for the granting of the nonqualified Stock Options, Incentive Stock Options, Stock Appreciation Rights (or SARs), Restricted Stock, Performance Units, and Performance Shares, to their employees, officers, directors, consultants, independent contractors, advisors, or other service providers, provided that such services are not in connection with the offer and sale of securities in a capital raising transaction. The Company initially reserved 60,000,000 shares of its common stock for awards to be made under the Plan. 59,605,412 of the shares under this plan have been issued.

On November 6, 2009, the Board of Directors adopted the 2009-3 Equity Incentive Plan (The “Plan”.) The Plan provides for the granting of the nonqualified Stock Options, Incentive Stock Options, Stock Appreciation Rights (or SARs), Restricted Stock, Performance Units, and Performance Shares, to their employees, officers, directors, consultants, independent contractors, advisors, or other service providers, provided that such services are not in connection with the offer and sale of securities in a capital raising transaction. The Company initially reserved 200,000,000 shares of its common stock for awards to be made under the Plan. 200,000,000 of the shares under this plan have been issued.

On May 6, 2011, the Board of Directors adopted the 2011 Equity Incentive Plan (The “Plan”.) The Plan provides for the granting of the nonqualified Stock Options, Incentive Stock Options, Stock Appreciation Rights (or SARs), Restricted Stock, Performance Units, and Performance Shares, to their employees, officers, directors, consultants, independent contractors, advisors, or other service providers, provided that such services are not in connection with the offer and sale of securities in a capital raising transaction. The Company initially reserved 600,000,000 shares of its common stock for awards to be made under the Plan. 600,000,000 of the shares under this plan have been issued.

On October 27, 2011, the Board of Directors adopted the 2011 Equity Incentive Plan (The “2011-II Plan”.) The Plan provides for the granting of the nonqualified Stock Options, Incentive Stock Options, Stock Appreciation Rights (or SARs), Restricted Stock, Performance Units, and Performance Shares, to their employees, officers, directors, consultants, independent contractors, advisors, or other service providers, provided that such services are not in connection with the offer and sale of securities in a capital raising transaction. The Company initially reserved 1,200,000,000 shares of its common stock for awards to be made under the Plan. 975,000,000 of the shares under this plan have been issued.

Common stock purchase options consisted of the following as of March 31, 2012:

	# shares		Weighted Average Exercise Price		Aggregated Intrinsic Value
Options:
Outstanding and exercisable, December 31, 2011		34,000	$	66	$	-
Granted		-				-
Exercised		-				-
Expired						-
Outstanding and exercisable, March 31, 2012		34,000	$	66	$	-