Fuel Performance Solutions (IFUE) 10-Q 15 Aug 16 2016 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2016	Aug. 15, 2016
Document And Entity Information
Entity Registrant Name	FUEL PERFORMANCE SOLUTIONS, INC.
Entity Central Index Key	1,078,723
Document Type	10-Q
Document Period End Date	Jun. 30, 2016
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		203,758,698
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2,016

BALANCE SHEETS

BALANCE SHEETS - USD ($)	Jun. 30, 2016	Dec. 31, 2015
Current assets
Cash and cash equivalents	$ 13,738	$ 25,609
Accounts receivable	11,169	20,476
Inventory	10,750	10,750
Prepaid expenses and other assets	15,024	27,112
Total Current Assets	50,681	83,947
Goodwill	2,211,805	2,211,805
Total assets	2,262,486	2,295,752
Current liabilities
Accounts payable	275,987	287,221
Convertible notes payable, net of discount of $0 and $109,811, respectively	1,092,500	982,689
Convertible notes payable - related party, net of discount of $0 and $4,885, respectively	57,500	52,615
Notes payable, net of discount of $20,216 and $0 respectively	266,034
Notes payable - related party, net of discount of $10,963 and $0 respectively	129,037
Accrued interest	222,973	158,997
Accrued interest - related party	13,406	8,368
Accrued compensation	1,006,958	937,141
Derivative liability	134,984	425,035
Other accrued expenses	190,000	190,000
Total current liabilities	3,389,379	3,042,066
Long-term liabilities
Notes payable, net of discount of $132,004 and $216,692, respectively	237,996	153,308
Notes payable - related party, net of discount of $16,056 and $15,243, respectively	28,944	29,757
Accrued interest	35,793	12,874
Accrued interest - related party	3,797	1,565
Deferred rent	5,440	6,428
Deferred income taxes	723,000	723,000
Total Long-term Liabilities	1,034,970	926,932
Total Liabilities	4,424,349	3,968,998
Stockholders' equity (deficit)
Common stock, $0.01 par value; 750,000,000 and 350,000,000 shares authorized at June 30, 2016 and December 31, 2015, respectively; 203,758,698 (net of 1,440,000 shares held in treasury stock) shares issued and outstanding at both June 30, 2016 and December 31, 2015	2,051,987	2,051,987
Treasury stock	(664,600)	(664,600)
Discount on common stock	(819,923)	(819,923)
Additional paid-in capital	72,472,389	72,471,486
Accumulated deficit	(75,201,716)	(74,712,196)
Total stockholders' equity (deficit)	(2,161,863)	(1,673,246)
Total liabilities and stockholders' equity (deficit)	$ 2,262,486	$ 2,295,752

BALANCE SHEETS (Parenthetical)

BALANCE SHEETS (Parenthetical) - USD ($)	Jun. 30, 2016	Dec. 31, 2015
Current liabilities
Convertible note payable, discount	$ 0	$ 109,811
Convertible notes payable - related party, net of discount	0	4,885
Notes payable, net of discount	20,216	0
Notes payable - related party, net of discount	10,963	0
Long-term liabilities
Notes payable, net of discount	132,004	216,692
Notes payable - related party, net of discount	$ 16,056	$ 15,243
Stockholders' equity (deficit)
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	750,000,000	350,000,000
Common stock, shares issued	203,758,698	203,758,698
Common stock, shares outstanding	203,758,698	203,758,698
Treasury Stock	1,440,000	1,440,000

STATEMENTS OF OPERATIONS (Unaud

STATEMENTS OF OPERATIONS (Unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Statements Of Operations
Net Revenues	$ 9,045	$ 91,295	$ 56,667	$ 225,368
Operating expenses:
Cost of operations		(71,598)	(34,470)	(173,070)
Selling, general and administrative expense	(224,851)	(385,233)	(540,238)	(776,713)
Total operating expenses	(224,851)	(456,831)	(574,708)	(949,783)
Net loss from operations	(215,806)	(365,536)	(518,041)	(724,415)
Interest expense, net	(92,605)	(167,519)	(292,709)	(316,475)
Gain (loss) on derivative liability	258,793	27,860	321,230	65,166
Net loss	$ (49,618)	$ (505,195)	$ (489,520)	$ (975,724)
Basic and diluted net income (loss) per common share	$ 0	$ 0	$ 0	$ 0
Weighted-average common shares outstanding, basic and diluted	203,758,698	203,758,698	203,758,698	203,758,698

STATEMENT OF STOCKHOLDERS' EQUI

STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT) (Unaudited) - 6 months ended Jun. 30, 2016 - USD ($)	Common Stock	Treasury Stock	Discount on Common Stock	Additional Paid-In Capital	Accumulated Deficit	Total
Beginning balance, Shares at Dec. 31, 2015	205,198,698
Beginning balance, Amount at Dec. 31, 2015	$ 2,051,987	$ (664,600)	$ (819,923)	$ 72,471,486	$ (74,712,196)	$ (1,673,246)
Expense relating to stock option grants				903		903
Net loss					(489,520)	(489,520)
Ending balance, Shares at Jun. 30, 2016	205,198,698
Ending balance, Amount at Jun. 30, 2016	$ 2,051,987	$ (664,600)	$ (819,923)	$ 72,472,389	$ (75,201,716)	$ (2,161,863)

STATEMENTS OF CASH FLOWS (Unaud

STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Cash flows from operating activities:
Net loss	$ (489,520)	$ (975,724)
Adjustments to reconcile net loss to net cash used in operating activities:
Non-cash option expense	903	72,783
(Gain) loss on derivative liability	(321,230)	(65,166)
Amortization of debt discount	198,571	255,971
Change in assets and liabilities:
Accounts receivable	9,307	291,518
Inventory		25,984
Prepaid expenses and other assets	12,088	12,257
Accounts payable	(11,234)	(212,452)
Accrued compensation	119,817	37,508
Accrued interest payable	94,165	60,593
Deferred rent	(988)	(1,625)
Net cash used in operating activities	(388,121)	(498,353)
Cash flows from financing activities:
Gross proceeds from issuance of notes payable	286,250
Gross proceeds from issuance of notes payable - related party	90,000
Net cash provided by financing activities	376,250
Net change in cash and cash equivalents	(11,871)	(498,353)
Cash and cash equivalents, beginning	25,609	530,201
Cash and cash equivalents, ending	13,738	31,848
Supplemental disclosure of cash flow information:
Cash paid during the six months ended June 30 : Interest
Cash paid during the six months ended June 30 : Income taxes
Non-cash transactions:
Debt discount due to warrants issued with notes payable	31,179
Notes payable issued for accrued compensation	$ 50,000

Basis of Presentation

Basis of Presentation	6 Months Ended
	Jun. 30, 2016
Notes to Financial Statements
Note 1 - Basis of Presentation	The interim financial statements included herein have been prepared by Fuel Performance Solutions, Inc. (formerly known as International Fuel Technology, Inc.) (the "Company," "we," "us" or "our") without audit, pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). Certain information and footnote disclosures normally included in financial statements prepared in accordance with United States generally accepted accounting principles ("GAAP") have been condensed or omitted pursuant to such rules and regulations, although we believe that the disclosures are adequate to make the information presented not misleading. These statements reflect all adjustments, consisting of normal recurring adjustments, which in the opinion of management are necessary for fair presentation of the information contained therein. Interim results are not necessarily indicative of results for a full year. We suggest that these financial statements be read in conjunction with the financial statements and notes thereto included in our annual report on Form 10-K for the year ended December 31, 2015, filed with the SEC on March 30, 2016. We follow the same accounting policies in preparation of interim reports as we do in our annual reports.

Substantial Doubt About Ability

Substantial Doubt About Ability to Continue as a Going Concern	6 Months Ended
	Jun. 30, 2016
Notes to Financial Statements
Note 2 - Substantial Doubt About Ability to Continue as a Going Concern	Our financial statements are presented on the going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. We have incurred significant losses since inception and currently have and previously from time to time have had limited funds with which to operate. These conditions raise substantial doubt as to the Company's ability to continue as a going concern. Management is in the process of executing a strategy based upon marketing technologies that offer enhanced engine performance and greater fuel economy along with pollution control benefits. We have been funded since inception primarily by unregistered sales of Company restricted stock, generally to existing shareholders. We have also relied on a $1,000,000 equity commitment from one of our Directors, Rex Carr, of which $500,000 remains available (See Note 5. Equity Commitment and Related Party Transactions). Rex Carr passed away on April 27, 2015. On April 30, 2015, the Company elected Glenn Carr as a Director to its Board of Directors (the "Board"). Glenn Carr is the son of Rex Carr. The Company believes that the equity commitment of Rex Carr will be honored by his estate. However, we can make no assurances as to the timing of when the estate may be settled, and how much we may receive once the estate is settled. During the second quarter of 2016, we assigned $12,500 of our claim against the Rex Carr estate pursuant to our $1,000,000 equity commitment, to an interim capital investor (see Note 9. Short term Notes Payable issued in Q2 2016). Subsequent to June 30, 2016, we assigned an additional $300,000 of our claim against the Rex Carr estate to other interim capital investors (see Note 13. Subsequent Events). In addition, during the third quarter of 2014, we obtained additional funding in the form of a convertible notes payable (see Note 6. Convertible Short-term Notes Payable). During the third quarter of 2015, we obtained additional funding in the form of a subordinated notes payable (see Note 7. Long term Notes Payable). We also obtained funding in the first quarter of 2016 in the form of subordinated notes (see Note 8. Short term Notes Payable issued in Q1 2016) and funding in the second quarter on 2016 in the form of subordinated notes (see Note 9. Short term Notes Payable issued in Q2 2016). We are currently in discussions with our investment bankers and a number of potential investors to raise additional capital. We believe we will be successful in raising additional capital to fund our operations, but if we are unable to secure additional capital, we will need to curtail operations. The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the possible inability of the Company to continue as a going concern.

Significant Accounting Policies

Significant Accounting Policies	6 Months Ended
	Jun. 30, 2016
Notes to Financial Statements
Note 3 - Significant Accounting Policies	Derivative Financial Instruments We evaluate our financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in our statements of operations. For stock-based derivative financial instruments, we use a Lattice Model option pricing model, assuming maximum value, in accordance with the Financial Accounting Standards Board (the "FASB") Accounting Standards Codification ("ASC") ASC 815-15, "Derivatives and Hedging," Debt Issuance Cost In accordance with FASB Accounting Standards Update No. 2015-03: Simplifying the Presentation of Debt Issuance Costs, we have reclassified Deferred Financing Costs as a direct deduction from the related debt liability rather than as an asset for the period ending June 30, 2016 and retroactively for the period ending December 31, 2015. Fair Value of Financial Instruments We measure our financial assets and liabilities in accordance with the requirements of ASC 820, "Fair Value Measurements and Disclosures," Level 1 - Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 1 primarily consists of financial instruments such as exchange-traded derivatives, marketable securities and listed equities. Level 2 - Pricing inputs are other than quoted prices in active markets included in level 1, which are either directly or indirectly observable as of the reported date and includes those financial instruments that are valued using models or other valuation methodologies. These models are primarily industry-standard models that consider various assumptions, including quoted forward prices for commodities, time value, volatility factors, and current market and contractual prices for the underlying instruments, as well as other relevant economic measures. Substantially all of these assumptions are observable in the marketplace throughout the full term of the instrument, can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace. Instruments in this category generally include non-exchange-traded derivatives such as commodity swaps, interest rate swaps, options and collars. Level 3 - Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally developed methodologies that result in management's best estimate of fair value. The following table sets forth by level within the fair value hierarchy the Company's financial assets and liabilities that were accounted for at fair value as of June 30, 2016, and December 31, 2015: Recurring Fair Value Measures Level 1 Level 2 Level 3 Total June 30, 2016 Derivative liability $ - $ - $ 134,984 $ 134,984 December 31, 2015 Derivative liability $ - $ - $ 425,035 $ 425,035

Stockholders' Equity (Deficit)

Stockholders' Equity (Deficit)	6 Months Ended
	Jun. 30, 2016
Notes to Financial Statements
Note 4 - Stockholders' Equity (Deficit)	On March 25, 2016, we filed a certificate of amendment to our Articles of Incorporation increasing the number of our authorized shares from 350,000,000 to 750,000,000 shares with the Nevada Secretary of State. Non-cash stock-based compensation expense recorded during the three and six months ended June 30, 2016 and June 30, 2015 is as follows: Three Months Ended June 30, 2016 Three Months Ended June 30, 2015 Six Months Ended June 30, 2016 Six Months Ended June 30, 2015 Awards to employees and Directors - $ 35,506 $ 903 $ 72,783 Awards to non-employees - - - - Total non-cash stock-based compensation expense - $ 35,506 $ 903 $ 72,783 Employee and Director Awards During the six months ended June 30, 2016, we did not issue any options to employees or Directors for Director-related services. The $903 of non-cash stock-based compensation expense recognized during the six months ended June 30, 2016 relates to employee options grants made during 2014 that have subsequent vesting terms. These 2014 employee options grants became fully-vested during the six months ended June 30, 2016. $0 of unrecognized non-cash stock-based compensation expense remains as of June 30, 2016. The following table summarizes information about stock options to employees and Directors that were issued and outstanding during the three months ended June 30, 2016: Shares Weighted-average exercise price Weighted-average exercise life Intrinsic value Outstanding at December 31, 2015 30,306,000 $ 0.10 3.24 $ - Granted - NA NA Cancelled - NA NA Expired - NA NA Outstanding at June 30, 2016 30,306,000 $ 0.10 2.75 $ - Options exercisable at June 30, 2016 30,306,000 $ 0.10 2.75 Options exercisable at December 31, 2015 29,639,333 $ 0.10 3.25 Non-employee Awards During the six months ended June 30, 2016, we did not issue any options to non-employee consultants for services. The following table summarizes information about stock options to non-employees that were issued and outstanding during the three months ended June 30, 2016: Shares Weighted-average exercise price Weighted-average exercise life Intrinsic value Outstanding at December 31, 2015 5,425,000 $ 0.19 1.57 $ - Granted - NA NA Cancelled - NA NA Expired 100,000 $ 0.25 NA Outstanding at June 30, 2016 5,325,000 $ 0.19 1.09 $ - Options exercisable at June 30, 2016 5,325,000 $ 0.19 1.09 Options exercisable at December 31, 2015 5,425,000 $ 0.19 1.57 Sales of Common Stock We did not receive any proceeds from the sale of common stock during the six months ended June 30, 2016.

Equity Commitment and Related P

Equity Commitment and Related Party Transactions	6 Months Ended
	Jun. 30, 2016
Notes to Financial Statements
Note 5 - Equity Commitment and Related Party Transactions	On June 6, 2016, the Company issued $25,000 of notes payable to David Norris, a Director of our Board and on June 24 $15,000 to Michael Gianino, a Director of our Board. These loans were pursuant to the notes payable transaction discussed in Note 9. Short term Notes Payable issued in Q2 2016. On March 9, 2016, the Company issued $50,000 of notes payable to Jonathan Burst, our Board chairman and Chief Executive Officer and $50,000 to Michael Gianino, a Director on our Board. These loans were pursuant to the notes payable transaction discussed in Note 8. Short term Notes Payable issued in Q1 2016 below. From the $100,000 notes issued, there is $50,000 cash proceeds from the related party notes payable of $50,000, while the remaining $50,000 is offset with accrued compensation, which is non-cash transaction. On August 21, 2015, the Company issued $25,000 of notes payable to Jonathan Burst, our Board chairman and Chief Executive Officer, $10,000 to Michael Gianino, a Director on our Board and $10,000 to Stuart D. Beath, our Chief Financial Officer. These loans were pursuant to the notes payable transaction discussed in Note 7. Long term Notes Payable below. Total cash proceeds from the $45,000 of related party notes payable is $10,000, while the remaining $35,000 is offset with accrued compensation. On August 22, 2014, the Company issued $57,500 ($7,500 OID and $50,000 principal) of notes payable to Jonathan Burst, our Board chairman and Chief Executive Officer. This loan was pursuant to the convertible note payable transaction discussed in Note 6. Convertible Short-term Notes Payable below. Effective December 11, 2007, we received an investment commitment from Rex Carr, a Director of the Company and a holder of over 5% of our common stock. Pursuant to the terms of the commitment, Mr. Rex Carr agreed to invest up to an aggregate of $1,000,000 in the Company, at such time or times as we may request, in the form of a purchase or purchases of our restricted common stock. We may elect to draw from the commitment at one time or from time to time; provided, however, that the aggregate of such draws may not exceed $1,000,000. We have drawn down $500,000 of the commitment and issued to Mr. Rex Carr that number of our shares of restricted common stock equal to the value of the investment then provided to us. The number of shares to be issued was calculated based on the closing price of our common stock as quoted on OTC Market Group's OTCQB marketplace on the date of the sale. There is no stipulation regarding the duration of this commitment. The total amount available under this commitment is $500,000 as of both June 30, 2016 and December 31, 2015. However, during the second quarter of 2016, we assigned $12,500 of our claim against the Rex Carr estate pursuant to our $1,000,000 equity commitment, to an interim capital investor (see Note 9. Short term Notes Payable issued in Q2 2016). Subsequent to June 30, 2016, we assigned an additional $300,000 of our claim against the Rex Carr estate to other interim capital investors (see Note 13. Subsequent Events). Rex Carr passed away on April 27, 2015. On April 30, 2015, the Company elected Glenn Carr to its Board. Glenn Carr is the son of Rex Carr, a deceased Director of the Company. The Company believes that the equity commitment of Rex Carr referenced above will be honored by his estate. However, we can make no assurances as to the timing of when the estate may be settled, and how much we may receive once the estate is settled.

Convertible Short-term Notes Pa

Convertible Short-term Notes Payable	6 Months Ended
	Jun. 30, 2016
Notes to Financial Statements
Note 6 - Convertible Short-term Notes Payable	On August 22, 2014 (the "2014 Closing Date"), we closed a financing transaction by entering into a Securities Purchase Agreement dated August 22, 2014 (the "2014 Securities Purchase Agreement") with certain funds and investors signatory to such 2014 Securities Purchase Agreement (the "2014 Purchasers") for an aggregate subscription amount of $1,000,000 (the "2014 Purchase Price") of which $50,000 is from a related party. Pursuant to the 2014 Securities Purchase Agreement, we issued the following to the 2014 Purchasers: (i) 10% Convertible Promissory Notes with an aggregate principal amount of $1,150,000 (the "2014 Notes"), and (ii) warrants to purchase an aggregate of 6,666,667 shares of the Company's common stock, par value $0.01 per share, for an exercise price of $0.12 per share for a period of five (5) years from the effective date of the registration statement (the "2014 Warrants"). We recorded $150,000 of original issuance cost related to this transaction, which we have recorded as debt discount. The terms of the 2014 Notes and the 2014 Warrants are as follows: 10% Convertible Promissory Notes The total principal amount of the 2014 Notes is issued with a 115% premium to the subscription amount. The 2014 Notes accrue interest at a rate equal to 10% per annum and originally had a maturity date of February 22, 2016. Subsequent to December 31, 2015, the maturity date of the 2014 Notes was extended to April 30, 2016. Subsequent to March 31, 2016, the maturity date of the 2014 Notes was further extended to June 15, 2016. The note is currently in default. We are currently in discussions with The 2014 Note Holders to further extend the maturity date. The 2014 Notes are convertible any time after the issuance date of the 2014 Notes. The 2014 Purchasers have the right to convert the 2014 Notes into shares of the Company's common stock at a conversion price equal to $0.10 per share, subject to standard adjustments for stock dividends, stock splits, subsequent equity sales, subsequent rights offerings and pro rata distributions. While the 2014 Notes are outstanding, in the event of a subsequent equity sale at a price lower than the conversion price of $0.10 per share, the conversion price of the 2014 Notes shall be reduced to the lower conversion price. The 2014 Notes can be redeemed under certain conditions and the Company can force the conversion of the 2014 Notes in the event certain equity conditions are met. In the event of default, the 2014 Purchasers have the right to require the Company to repay in cash all or a portion of the 2014 Notes at a price equal to 125% of the aggregate principal amount of the 2014 Notes plus all accrued but unpaid interest. We recorded $29,513 and $30,840 of interest expense related to the issuance of the 2014 Notes during the three months ended June 30, 2016 and June 30, 2015, respectively. We recorded $62,765 and $60,593 of interest expense related to the issuance of the 2014 Notes during the six months ended June 30, 2016 and June 30, 2015, respectively. Warrants The 2014 Warrants are exercisable in whole or in part, at an initial exercise price per share of $0.12, subject to adjustment. The exercise price and number of shares of the Company's common stock issuable under the 2014 Warrants (the "2014 Warrant Shares") are subject to adjustments for stock dividends, splits, combinations, subsequent rights offerings, pro rata distributions and any issuance of securities below the exercise price of the 2014 Warrants. While the 2014 Warrants are outstanding, in the event of a subsequent equity sale including a warrant exercise price lower than the exercise price of $0.12 per share, the exercise price of the 2014 Warrants shall be reduced to the lower exercise price. Any adjustment to the exercise price shall similarly cause the number of 2014 Warrant Shares to be adjusted so that the total value of the 2014 Warrants may increase, provided, that in no event shall the number of 2014 Warrant Shares exceed 200% of the original number of 2014 Warrant Shares originally issued. In addition to the 2014 Warrants described above, the Company also issued 800,000 warrants to a placement agent assisting with the convertible note transaction. The terms of the placement agent warrants are the same as of the terms of the 2014 Warrants explained above. Registration Rights Agreement In connection with the sale of the 2014 Notes and 2014 Warrants pursuant to the 2014 Securities Purchase Agreement, the Company entered into a registration rights agreement (the "2014 Registration Rights Agreement") with the 2014 Purchasers, pursuant to which the Company agreed to register all of the shares of common stock underlying the 2014 Notes and the shares of common stock underlying the 2014 Warrants (together, the "2014 Registrable Securities") on a Form S-1 registration statement (the "2014 Registration Statement") to be filed with the SEC within thirty (30) calendar days following the 2014 Closing Date (the "2014 Filing Deadline") and to use its best efforts to cause the 2014 Registration Statement to be declared effective under the Securities Act within one hundred (100) calendar days following the 2014 Closing Date (the "2014 Effectiveness Deadline"). The 2014 Registration Statement became effective November 26, 2014. Deferred Financing Cost In connection with the convertible note transaction explained above, the Company paid $55,000 for legal fees and $80,000 for placement agent fees. In addition, $29,550 was also recorded to deferred financing costs related to the fair value valuation of the placement agent warrants. $0 and $27,189 of deferred financing costs were amortized during the three months ended June 30, 2016 and June 30, 2015, respectively. $17,008 and $53,403 of deferred financing costs were amortized during the six months ended June 30, 2016 and June 30, 2015, respectively. The deferred financing cost balance related to the 2014 Notes is $0 and $17,008 as of June 30, 2016 and December 31, 2015, respectively. Derivative Because the above convertible 2014 Notes and 2014 Warrants have full reset adjustments tied to future issuances of equity securities by the Company, they are subject to derivative liability treatment under ASC 815-40-15, "Determining Whether an Instrument (or Embedded Feature) is Indexed to an Entity's Own Stock" Debt Discount On issuance date, the fair value of the derivative liability for both the convertible 2014 Notes and 2014 Warrants was $295,773 and $246,905, respectively. Therefore a total of $692,678 (including $150,000 original issuance costs) of debt discount was recorded. $97,688 and $202,568 was recorded as amortization of debt discount during the six months ended June 30, 2016 and June 30, 2015, respectively. As of June 30, 2016, the convertible 2014 Notes have a balance of $1,092,500, net of $0 of debt discount, and accrued interest of $218,398. As of December 31, 2015, the convertible 2014 Notes have a balance of $982,689, net of $109,811 of debt discount, and accrued interest of $158,997. As of June 30, 2016, the related party convertible 2014 Note has a balance of $57,500, net of $0 of debt discount, and accrued interest of $11,732. As of December 31, 2015, the related party convertible 2014 Notes have a balance of $52,615, net of $4,885 of debt discount, and accrued interest of $8,368.

Long Term Notes Payable

Long Term Notes Payable	6 Months Ended
	Jun. 30, 2016
Notes to Financial Statements
Note 7 - Long Term Notes Payable	On August 21, 2015 (the "2015 Closing Date"), we closed a financing transaction by entering into a Securities Purchase Agreement dated August 21, 2015 (the "2015 Securities Purchase Agreement") with certain funds and investors signatory to such 2015 Securities Purchase Agreement (the "2015 Purchasers") for an aggregate subscription amount of $415,000 (the "2015 Purchase Price") of which $45,000 is from related parties (see Note 5. Equity Commitment and Related Party Transactions). Pursuant to the 2015 Securities Purchase Agreement, we issued the following to the 2015 Purchasers: (i) 10% Promissory Notes with an aggregate principal amount of $415,000 (the "2015 Notes"), and (ii) warrants to purchase an aggregate of 4,150,000 shares of the Company's common stock, par value $0.01 per share, for an exercise price of $0.12 per share for a period of five (5) years from the Securities Purchase Agreement date (the "2015 Warrants"). The 2015 Notes are subordinated to the 2014 Notes. In addition, we issued 2,075,000 restricted common shares of our stock to the 2015 Purchasers, previously defined above as the 2015 Affiliate Shares. The 2015 Affiliate Shares have a fair value of $63,787 and were valued based on the closing price of our common stock on August 21, 2015. The 2015 Affiliate Shares were contributed from existing shareholdings of related party Board members and did not increase the total number of our common shares outstanding. The terms of the 2015 Notes and the 2015 Warrants are as follows: 10% Promissory Notes The total principal amount of the 2015 Notes is $415,000. The 2015 Notes accrue interest at a rate equal to 10% per annum and have a maturity date of August 21, 2017. The 2015 Notes can be redeemed by the Company at any time without penalty. In the event of default, the 2015 Purchasers have the right to require the Company to repay in cash all or a portion of the 2015 Notes at a price equal to 125% of the aggregate principal amount of the 2015 Notes plus all accrued but unpaid interest. We recorded $14,918 and $0 of interest expense related to the issuance of the 2015 Notes during the three months ended June 30, 2016 and June 30, 2015, respectively. We recorded $25,120 and $0 of interest expense related to the issuance of the 2015 Notes during the six months ended June 30, 2016 and June 30, 2015, respectively. Warrants The 2015 Warrants are exercisable in whole or in part, at an initial exercise price per share of $0.12, subject to adjustment. The exercise price and number of shares of the Company's common stock issuable under the 2015 Warrants (the "2015 Warrant Shares") are subject to adjustments for stock dividends, splits, combinations, subsequent rights offerings, pro rata distributions and any issuance of securities below the exercise price of the 2015 Warrants. While the 2015 Warrants are outstanding, in the event of a subsequent equity sale including a warrant exercise price lower than the exercise price of $0.12 per share, the exercise price of the 2015 Warrants shall be reduced to the lower exercise price. Any adjustment to the exercise price shall similarly cause the number of 2015 Warrant Shares to be adjusted so that the total value of the 2015 Warrants may increase. In addition to the 2015 Warrants described above, the Company also issued 296,000 warrants to a placement agent assisting with the 2015 Notes transaction. The terms of the placement agent warrants are the same as of the terms of the 2015 Warrants explained above. Deferred Financing Cost In connection with the note transaction explained above, the Company paid $7,500 for legal fees and $29,600 for placement agent fees. In addition, $12,775 was also recorded to deferred financing costs related to the fair value valuation of the placement agent warrants. $6,209 and $0 of deferred financing costs was amortized during the three months ended June 30, 2016 and June 30, 2015, respectively. $12,418 and $0 of deferred financing costs was amortized during the six months ended June 30, 2016 and June 30, 2015, respectively. The deferred financing cost balance related to the 2015 Notes is $28,451 and $40,869 as of June 30, 2016 and December 31, 2015, respectively. Derivative Because the above 2015 Notes and 2015 Warrants have full reset adjustments tied to future issuances of equity securities by the Company, they are subject to derivative liability treatment under ASC 815-40-15. ASC 815-40-15 requires as of the date the 2015 Notes and 2015 Warrants are issued, the derivative liability to be measured at the fair value and re-evaluated at the end of each reporting period. See Note 10. Derivative Liability. Debt Discount On issuance date, the fair value of the derivative liability for the 2015 Warrants was $179,106. Also, the relative fair value of the 2015 Affiliate Shares was $63,787. Therefore a total of $242,893 of debt discount was recorded. $35,729 and $0 was recorded as amortization of debt discount during the three months ended June 30, 2016 and 2015, respectively. $71,458 and $0 was recorded as amortization of debt discount during the six months ended June 30, 2016 and 2015, respectively. As of June 30, 2016, the 2015 Notes have a balance of $237,996, net of $$132,004 of debt discount, and accrued interest of $35,793. As of December 31, 2015, the 2015 Notes have a balance of $153,308, net of $216,692 of debt discount, and accrued interest of $12,874. As of June 30, 2016, the related party 2015 Notes have a balance of $$28,944, net of $$16,056 of debt discount, and accrued interest of $3,797. As of December 31, 2015, the related party 2015 Notes have a balance of $29,757, net of $15,243 of debt discount, and accrued interest of $1,565.

Short Term Notes Payable issued

Short Term Notes Payable issued in Q1 2016	6 Months Ended
	Jun. 30, 2016
Notes to Financial Statements
Note 8 - Short Term Notes Payable issued in Q1 2016	On March 9, 2016 (the "2016 Q1 Closing Date"), we closed a financing transaction by entering into a Securities Purchase Agreement dated March 9, 2016 (the "2016 Q1 Securities Purchase Agreement") with certain investors signatory to such 2016 Q1 Securities Purchase Agreement (the "2016 Q1 Purchasers") for an aggregate subscription amount of $373,750 (the "2016 Q1 Purchase Price") of which $100,000 is from related parties, and out of the $100,000, $50,000 is non-cash transaction (see Note 5. Equity Commitment and Related Party Transactions). Pursuant to the 2016 Q1 Securities Purchase Agreement, we issued the following to the 2016 Q1 Purchasers: (i) 10% Promissory Notes with an aggregate principal amount of $373,750 (the "2016 Q1 Notes"), and (ii) warrants to purchase an aggregate of 3,737,500 shares of the Company's common stock, par value $0.01 per share, for an exercise price of $0.05 per share for a period of five (5) years from the Securities Purchase Agreement date (the "2016 Q1 Warrants"). In addition, the 2016 Q1 Notes provide for a return of principal with a 1.5 factor. The 2016 Q1 Notes are subordinated to the 2014 Notes. The terms of the 2016 Q1 Notes and the 2016 Q1 Warrants are as follows: 10% Promissory Notes The total principal amount of the 2016 Q1 Notes is $373,750. The 2016 Q1 Notes will not accrue interest unless they are not repaid by the April 30, 2016 maturity date. Subsequent to the April 30, 2016 maturity date, simple interest shall accrue at an annual rate of 10% on a principal amount calculated by taking the original investment amount multiplied by the 1.5 factor. Subsequent to March 31, 2016 the maturity date of the 2016 Q1 Notes was extended to June 30, 2016. The note is currently in default. We are currently in discussions with the 2016 Q1 Note Holders to further extend the maturity date. The 2016 Q1 Notes can be redeemed by the Company at any time without penalty. In the event of default, the outstanding principal amount of the 2016 Q1 Note plus accrued but unpaid interest, liquidated damages and other amounts owing in respect thereof through the date of acceleration, shall become, at the 2016 Q1 Purchasers election, immediately due and payable in cash. We recorded $6,249 and $0 of interest expense related to the issuance of the 2016 Q1 Notes during the three months ended June 30, 2016 and June 30, 2015, respectively. We recorded $6,249 and $0 of interest expense related to the issuance of the 2016 Q1 Notes during the six months ended June 30, 2016 and June 30, 2015, respectively. Warrants The 2016 Q1 Warrants are exercisable in whole or in part, at an initial exercise price per share of $0.05, subject to adjustment. The exercise price and number of shares of the Company's common stock issuable under the 2016 Q1 Warrants (the "2016 Q1 Warrant Shares") are subject to adjustments for stock dividends, splits, combinations, subsequent rights offerings, pro rata distributions and any issuance of securities below the exercise price of the 2016 Q1 Warrants. While the 2016 Q1 Warrants are outstanding, in the event of a subsequent equity sale including a warrant exercise price lower than the exercise price of $0.05 per share, the exercise price of the 2016 Q1 Warrants shall be reduced to the lower exercise price. Any adjustment to the exercise price shall similarly cause the number of 2016 Q1 Warrant Shares to be adjusted so that the total value of the 2016 Q1 Warrants may increase. Derivative Because the above 2016 Q1 Notes and 2016 Q1 Warrants have full reset adjustments tied to future issuances of equity securities by the Company, they are subject to derivative liability treatment under ASC 815-40-15. ASC 815-40-15 requires as of the date the 2016 Q1 Notes and 2016 Q1 Warrants are issued, the derivative liability to be measured at the fair value and re-evaluated at the end of each reporting period. See Note 11. Derivative Liability. Debt Discount On issuance date, the fair value of the derivative liability for the 2016 Q1 Warrants was $25,879. Therefore a total of $25,879 of debt discount was recorded. $0 was recorded as amortization of debt discount during the six months ended June 30, 2016 and 2015, respectively. As of June 30, 2016, the 2016 Q1 Notes have a balance of $254,796, net of discount $18,954, and accrued interest of $4,575. As of June 30, 2016, the related party 2016 Q1 Notes have a balance of $93,075, net of discount $6,925 and accrued interest of $1,674.

Short Term Notes Payable issu15

Short Term Notes Payable issued in Q2 2016	6 Months Ended
	Jun. 30, 2016
Notes to Financial Statements
Note 9 - Short Term Notes Payable issued in Q2 2016	On June 24, 2016 (the "2016 Q2 Closing Date"), we closed a financing transaction by entering into a Securities Purchase Agreement dated June 24, 2016 (the "2016 Q2 Securities Purchase Agreement") with certain investors signatory to such 2016 Q2 Securities Purchase Agreement (the "2016 Q2 Purchasers") for an aggregate subscription amount of $52,500 (the "2016 Q2 Purchase Price") of which $40,000 is from related parties (see Note 5. Equity Commitment and Related Party Transactions). Pursuant to the 2016 Q2 Securities Purchase Agreement, we issued the following to the 2016 Q2 Purchasers: (i) 10% Promissory Notes with an aggregate principal amount of $52,500 (the "2016 Q2 Notes"), and (ii) warrants to purchase an aggregate of 525,000 shares of the Company's common stock, par value $0.01 per share, for an exercise price of $0.05 per share for a period of five (5) years from the Securities Purchase Agreement date (the "2016 Q2 Warrants"). In addition, the 2016 Q2 Notes provide for a return of principal with a 1.5 factor. The 2016 Q2 Notes are subordinated to the 2014 Notes. The $12,500 of the 2016 Q2 Notes Payable to a non-affiliated party received as collateral for his investment, an assignment of $12,500 of our claim against the Rex Carr estate pursuant to our $1,000,000 equity commitment. The remaining $40,000 to related parties, did not receive any collateral for their investments. The terms of the 2016 Q2 Notes and the 2016 Q2 Warrants are as follows: 10% Promissory Notes The total principal amount of the 2016 Q2 Notes is $52,500. The 2016 Q2 Notes will not accrue interest unless they are not repaid by the September 30, 2016 maturity date. Subsequent to the September 30, 2016 maturity date, simple interest shall accrue at an annual rate of 10% on a principal amount calculated by taking the original investment amount multiplied by the 1.5 factor. The 2016 Q2 Notes can be redeemed by the Company at any time without penalty. In the event of default, the outstanding principal amount of the 2016 Q2 Notes plus accrued but unpaid interest, liquidated damages and other amounts owing in respect thereof through the date of acceleration, shall become, at the 2016 Q2 Purchasers election, immediately due and payable in cash. Warrants The 2016 Q2 Warrants are exercisable in whole or in part, at an initial exercise price per share of $0.05, subject to adjustment. The exercise price and number of shares of the Company's common stock issuable under the 2016 Q2 Warrants (the "2016 Q2 Warrant Shares") are subject to adjustments for stock dividends, splits, combinations, subsequent rights offerings, pro rata distributions and any issuance of securities below the exercise price of the 2016 Q2 Warrants. While the 2016 Q2 Warrants are outstanding, in the event of a subsequent equity sale including a warrant exercise price lower than the exercise price of $0.05 per share, the exercise price of the 2016 Q2 Warrants shall be reduced to the lower exercise price. Any adjustment to the exercise price shall similarly cause the number of 2016 Q2 Warrant Shares to be adjusted so that the total value of the 2016 Q2 Warrants may increase. Derivative Because the above 2016 Q2 Notes and 2016 Q2 Warrants have full reset adjustments tied to future issuances of equity securities by the Company, they are subject to derivative liability treatment under ASC 815-40-15. ASC 815-40-15 requires as of the date the 2016 Q2 Notes and 2016 Q2 Warrants are issued, the derivative liability to be measured at the fair value and re-evaluated at the end of each reporting period. See Note 11. Derivative Liability. Debt Discount On issuance date, the fair value of the derivative liability for the 2016 Q2 Warrants was $5,300. Therefore a total of $5,300 of debt discount was recorded. $0 was recorded as amortization of debt discount during the three and six months ended June 30, 2016 and 2015, respectively. As of June 30, 2016, the 2016 Q2 Notes have a balance of $11,238, net of $1,262 of debt discount, and accrued interest of $0. As of June 30, 2016, the related party 2016 Q2 Notes have a balance of $35,962, net of $4,038 of debt discount, and accrued interest of $0.

Blencathia Merger

Blencathia Merger	6 Months Ended
	Jun. 30, 2016
Notes to Financial Statements
Note 10 - Blencathia Merger	Effective October 27, 1999, we merged with Blencathia Acquisition Corporation ("Blencathia"). Blencathia was a public shell company with immaterial assets and liabilities and 312,000 shares outstanding at the time of the merger, which it redeemed and cancelled upon the merger. In exchange, we issued 312,000 of our common shares to the prior Blencathia owner with the contractual understanding that such shares were to be sold by that owner to achieve gross cash proceeds of $500,000. Any excess proceeds were to be returned to us and any deficiency was to be made up by us issuing additional shares or paying the difference in cash. As we believed that we controlled the ultimate timing of the sale of these 312,000 shares by the prior Blencathia owner, we did not consider these shares as issued or outstanding for purposes of computing earnings per share prior to 2006. In 2006, we learned that the prior Blencathia owner had, in fact, sold the 312,000 shares for aggregate proceeds of approximately $150,000, without our consent. Accordingly, in the fourth quarter of 2006, we recorded $500,000 of general expenses (representing the cost of the 1999 merger) and the deemed issuance of approximately $150,000 of common stock. The remaining $350,000 obligation was reflected as a current accrued expense. Beginning in 2006, the 312,000 shares have been reflected as outstanding for earnings per share computations. During 2009 and 2010, we made payments totaling $160,000 to the prior Blencathia owner. We have not made any payments to the prior Blencathia owner since 2010. The related current accrued expense balance remains at $190,000 at June 30, 2016. We are in negotiations with the prior Blencathia owner to resolve this obligation and may ultimately settle the obligation with either cash or equity securities with a lower market value.

Derivative Liability

Derivative Liability	6 Months Ended
	Jun. 30, 2016
Notes to Financial Statements
Note 11 - Derivative Liability	During 2009, we granted a warrant to purchase 2,000,000 shares of the Company's common stock to an accredited investor in conjunction with equity raise efforts. On April 12, 2013, our Board authorized and approved the extension of the expiration date and a change of exercise price for this warrant. The outstanding share purchase warrant originally had a March 23, 2014 expiration date and an exercise price of $0.25. The new modified terms extended the warrant expiration date to April 11, 2018 and reduced the exercise price to $0.226. The exercise price is also subject to dilutive adjustments for share issuances (full ratchet reset features). As of both June 30, 2016 and December 31, 2015, the exercise price has been reduced to approximately $0.14 and an additional 1,620,015 and 1,430,134 warrants as of June 30, 2016 and December 31, 2015, respectively, are to be issued to the investor due to the reset features. On August 21, 2015, we issued 4,150,000 warrants to investors and 296,000 warrants to a placement agent. The exercise price of these warrants is also subject to dilutive adjustments for share issuance (full ratchet reset features). During Q1 2016, an additional 5,810,000 warrants were issued to the 2015 Notes Payable holders and an additional 414,400 warrants were issued to the placement agent because of the reset provision. See Note 7. 2015 Notes Payable. On August 22, 2014, we issued 6,666,667 warrants to investors and 800,000 warrants to a placement agent. The exercise price of these warrants is also subject to dilutive adjustments for share issuance (full ratchet reset features). During Q1 2016, an additional 9,333,334 warrants were issued to the 2014 Notes Payable holders and an additional 1,120,000 warrants were issued to the placement agent because of this reset provision. See Note 6. Convertible Short-term Notes Payable. In the first quarter of 2016 we issued 3,737,500 warrants to investors (see note 8). The exercise price of these warrants is subject to dilutive adjustments for share issuance (full ratchet reset features). In the second quarter of 2016 we 525,000 warrants to investors (see note 9). The exercise price of these warrants is subject to dilutive adjustments for share issuance (full ratchet reset features). Because the convertible 2014 Notes, 2014 Warrants and 2015 Warrants and 2016 Warrants all have full reset adjustments tied to future issuances of equity securities by the Company, they are subject to derivative liability treatment under ASC 815-40-15, which requires as of the date the convertible 2014 Notes, 2014 Warrants and 2015 Warrants are issued, the derivative liability to be measured at fair value and re-evaluated at the end of each reporting period. Key assumptions used to determine the fair value of the convertible 2014 Notes are as follows: Stock price volatility (one-year measurement): December 31, 2015 measurement 174 % June 30, 2016 measurement 209 % Probability of default triggering 21% interest rate, increasing 1% per month to a maximum of 10% with a 125% penalty: 0 % Probability of the Company redeeming the convertible 2014 Notes (with 130% penalty): projected initially at 0% of the time, increasing 2% monthly to a maximum of 5% (from alternative financing being available for a redemption event to occur) Conversion behavior - holder automatically converts the convertible 2014 Notes at a maximum of 2 times the conversion price. Key assumptions used to determine the fair value of the 2014 Warrants and 2015 Warrants are as follows: Stock price volatility (one-year measurement): December 31, 2015 measurement 174 % June 30, 2016 measurement 209 % Exercise behavior – warrant exercise at target prices 2 times the higher of the projected reset price or stock price. As of June 30, 2016, the fair value of the total convertible 2014 Notes, 2014 Warrants, 2015 Warrants and 2016 Warrants' derivative liability is $134,984 and we recognized a gain on derivative liability of $321,230 and $65,166 for the six months ended June 30, 2016 and June 30, 2015, respectively. The following table summarizes the derivative liability included in the balance sheet: Balance at December 31, 2015 $ 425,035 Gain on change of fair value $ (321,230 ) Issuance of warrants $ 31,179 Balance at June 30, 2016 $ 134,984 The following table summarizes information about warrants outstanding as of June 30, 2016: Total # of warrants issued and outstanding 53,743,666 Weighted-average exercise price $ 0.10 Remaining life (in years) 2.70 Intrinsic value $ -

Legal Proceedings

Legal Proceedings	6 Months Ended
	Jun. 30, 2016
Notes to Financial Statements
Note 12 - Legal Proceedings	We are periodically subject to various lawsuits and claims with respect to matters arising out of the normal course of business. While the impact on future financial results is not subject to reasonable estimation because considerable uncertainty exists, management believes, after consulting with counsel, that it is more likely than not that the ultimate liabilities resulting from such lawsuits and claims will not materially affect our financial position, results of operations or liquidity. On July 31, 2006, we received notice from the American Arbitration Association ("AAA") of a Demand for Arbitration dated July 27, 2006 received by the AAA naming the Company as Respondent and TPG Capital Partners ("TPG"), the prior Blencathia owner, as the Claimant. The arbitration had been requested by TPG to resolve an alleged aggregate proceeds shortfall from the sale of our securities issued in the Blencathia merger. TPG has claimed they sold some or all of the 312,000 shares and the sales have not generated at least $500,000 of proceeds, as guaranteed in the merger documents. In an effort to resolve this matter prior to submission to binding arbitration, both TPG and the Company participated in a non-binding mediation conference on January 30, 2007, which did not resolve the matter. Informal discussions are ongoing. It is not expected that the ultimate settlement of this matter, considering we have recorded a liability for the shortfall amount, will have an additional adverse material effect on the Company. Since 2009, the Company has made payments to TPG totaling $160,000 to reduce the recorded liability. The remaining recorded liability balance is $190,000 at both June 30, 2016 and December 31, 2015, respectively. We are a defendant in litigation with a former employee regarding accrued but unpaid salary. We are in discussions for settlement of this claim and have accrued an amount that we believe will resolve this matter.

Subsequent Events

Subsequent Events	6 Months Ended
	Jun. 30, 2016
Notes to Financial Statements
Note 13 - Subsequent Events	On July 7, 2016, July 20, 2016 and July 27 2016, the Company issued $42,000, $42,000 and $41,000, respectively, of notes payable to non-affiliated individual investors. A total of 1,250,000 five-year warrants with an exercise price of $0.05 per share were issued pursuant to these investments.The terms of these loans were the same as the terms of the 2016 Q2 Notes Payable (see Note 9.). In addition, a total of $300,000 of collateral, in the form of an assignment of our claim against the Rex Carr estate, was assigned to these investors.

Significant Accounting Polici20

Significant Accounting Policies (Policies)	6 Months Ended
	Jun. 30, 2016
Significant Accounting Policies Policies
Derivative Financial Instruments	We evaluate our financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in our statements of operations. For stock-based derivative financial instruments, we use a Lattice Model option pricing model, assuming maximum value, in accordance with the Financial Accounting Standards Board (the "FASB") Accounting Standards Codification ("ASC") ASC 815-15, "Derivatives and Hedging,"
Debt Issuance Cost	In accordance with FASB Accounting Standards Update No. 2015-03: Simplifying the Presentation of Debt Issuance Costs, we have reclassified Deferred Financing Costs as a direct deduction from the related debt liability rather than as an asset for the period ending June 30, 2016 and retroactively for the period ending December 31, 2015.
Fair Value of Financial Instruments	We measure our financial assets and liabilities in accordance with the requirements of ASC 820, "Fair Value Measurements and Disclosures," Level 1 - Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 1 primarily consists of financial instruments such as exchange-traded derivatives, marketable securities and listed equities. Level 2 - Pricing inputs are other than quoted prices in active markets included in level 1, which are either directly or indirectly observable as of the reported date and includes those financial instruments that are valued using models or other valuation methodologies. These models are primarily industry-standard models that consider various assumptions, including quoted forward prices for commodities, time value, volatility factors, and current market and contractual prices for the underlying instruments, as well as other relevant economic measures. Substantially all of these assumptions are observable in the marketplace throughout the full term of the instrument, can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace. Instruments in this category generally include non-exchange-traded derivatives such as commodity swaps, interest rate swaps, options and collars. Level 3 - Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally developed methodologies that result in management's best estimate of fair value. The following table sets forth by level within the fair value hierarchy the Company's financial assets and liabilities that were accounted for at fair value as of June 30, 2016, and December 31, 2015: Recurring Fair Value Measures Level 1 Level 2 Level 3 Total June 30, 2016 Derivative liability $ - $ - $ 134,984 $ 134,984 December 31, 2015 Derivative liability $ - $ - $ 425,035 $ 425,035

Significant Accounting Polici21

Significant Accounting Policies (Tables)	6 Months Ended
	Jun. 30, 2016
Significant Accounting Policies Tables
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis	The following table sets forth by level within the fair value hierarchy the Company's financial assets and liabilities that were accounted for at fair value as of June 30, 2016, and December 31, 2015: Recurring Fair Value Measures Level 1 Level 2 Level 3 Total June 30, 2016 Derivative liability $ - $ - $ 134,984 $ 134,984 December 31, 2015 Derivative liability $ - $ - $ 425,035 $ 425,035

Stockholders' Equity (Deficit)

Stockholders' Equity (Deficit) (Tables)	6 Months Ended
	Jun. 30, 2016
Stockholders Equity Deficit Tables
Schedule of Stock Option Recorded	Non-cash stock-based compensation expense recorded during the three and six months ended June 30, 2016 and June 30, 2015 is as follows: Three Months Ended June 30, 2016 Three Months Ended June 30, 2015 Six Months Ended June 30, 2016 Six Months Ended June 30, 2015 Awards to employees and Directors - $ 35,506 $ 903 $ 72,783 Awards to non-employees - - - - Total non-cash stock-based compensation expense - $ 35,506 $ 903 $ 72,783
Schedule of Stock Option Issued to Employees and Directors	The following table summarizes information about stock options to employees and Directors that were issued and outstanding during the three months ended June 30, 2016: Shares Weighted-average exercise price Weighted-average exercise life Intrinsic value Outstanding at December 31, 2015 30,306,000 $ 0.10 3.24 $ - Granted - NA NA Cancelled - NA NA Expired - NA NA Outstanding at June 30, 2016 30,306,000 $ 0.10 2.75 $ - Options exercisable at June 30, 2016 30,306,000 $ 0.10 2.75 Options exercisable at December 31, 2015 29,639,333 $ 0.10 3.25
Schedule of Stock Option Issued to Non Employees	The following table summarizes information about stock options to non-employees that were issued and outstanding during the three months ended June 30, 2016: Shares Weighted-average exercise price Weighted-average exercise life Intrinsic value Outstanding at December 31, 2015 5,425,000 $ 0.19 1.57 $ - Granted - NA NA Cancelled - NA NA Expired 100,000 $ 0.25 NA Outstanding at June 30, 2016 5,325,000 $ 0.19 1.09 $ - Options exercisable at June 30, 2016 5,325,000 $ 0.19 1.09 Options exercisable at December 31, 2015 5,425,000 $ 0.19 1.57

Derivative Liability (Tables)

Derivative Liability (Tables)	6 Months Ended
	Jun. 30, 2016
Derivative Liability Tables
Fair value of convertible note	Key assumptions used to determine the fair value of the convertible 2014 Notes are as follows: Stock price volatility (one-year measurement): December 31, 2015 measurement 174 % June 30, 2016 measurement 209 % Probability of default triggering 21% interest rate, increasing 1% per month to a maximum of 10% with a 125% penalty: 0 % Probability of the Company redeeming the convertible 2014 Notes (with 130% penalty): projected initially at 0% of the time, increasing 2% monthly to a maximum of 5% (from alternative financing being available for a redemption event to occur) Conversion behavior - holder automatically converts the convertible 2014 Notes at a maximum of 2 times the conversion price.
Fair value of the warrants	Key assumptions used to determine the fair value of the 2014 Warrants and 2015 Warrants are as follows: Stock price volatility (one-year measurement): December 31, 2015 measurement 174 % June 30, 2016 measurement 209 % Exercise behavior – warrant exercise at target prices 2 times the higher of the projected reset price or stock price.
Summary of derivative liability	The following table summarizes the derivative liability included in the balance sheet: Balance at December 31, 2015 $ 425,035 Gain on change of fair value $ (321,230 ) Issuance of warrants $ 31,179 Balance at June 30, 2016 $ 134,984
Summary of warrants outstanding	The following table summarizes information about warrants outstanding as of June 30, 2016: Total # of warrants issued and outstanding 53,743,666 Weighted-average exercise price $ 0.10 Remaining life (in years) 2.70 Intrinsic value $ -

Substantial Doubt About Abili24

Substantial Doubt About Ability to Continue as a Going Concern (Details Narrative)	6 Months Ended
	Jun. 30, 2016USD ($)
Substantial Doubt About Ability To Continue As Going Concern Details Narrative
Claim against related party	$ 12,500
Equity commitment to interim capital investor	$ 1,000,000

Significant Accounting Polici25

Significant Accounting Policies (Details) - USD ($)	Jun. 30, 2016	Dec. 31, 2015
Derivative liability	$ 134,984	$ 425,035
Level 1 [Member]
Derivative liability
Level 2 [Member]
Derivative liability
Level 3 [Member]
Derivative liability	$ 134,984	$ 425,035

Stockholders' Equity (Deficit26

Stockholders' Equity (Deficit) (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Total non-cash stock-based compensation expense		$ 35,506	$ 903	$ 72,783
Employee and Director awards [Member]
Total non-cash stock-based compensation expense		35,506	903	72,783
Non-employee awards [Member]
Total non-cash stock-based compensation expense

Stockholders' Equity (Deficit27

Stockholders' Equity (Deficit) (Details 1) - Employees and Directors [Member]	6 Months Ended
	Jun. 30, 2016USD ($)$ / sharesshares
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding
Outstanding at beginning of period | shares	30,306,000
Granted | shares
Cancelled | shares
Expired | shares
Options Outstanding at end of period | shares	30,306,000
Exercisable at beginning of period | shares	29,639,333
Exercisable at end of period | shares	30,306,000
Weighted Average Exercise Price
Outstanding, Beginning | $ / shares	$ 0.10
Granted | $ / shares
Cancelled | $ / shares
Expired | $ / shares
Outstanding, Ending | $ / shares	0.10
Exercisable, Beginning | $ / shares	0.10
Exercisable, Ending | $ / shares	$ 0.10
Weighted Average Remaining Contractual Term
Outstanding, Beginning	3 years 2 months 27 days
Outstanding, Ending	2 years 9 months
Options exercisable, Beginning	3 years 3 months
Options exercisable, Ending	2 years 9 months
Aggregate Intrinsic Value
Outstanding, Beginning | $
Outstanding, Ending | $

Stockholders' Equity (Deficit28

Stockholders' Equity (Deficit) (Details 2) - Non-employees [Member]	6 Months Ended
	Jun. 30, 2016USD ($)$ / sharesshares
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding
Outstanding at beginning of period | shares	5,425,000
Granted | shares
Cancelled | shares
Expired | shares	100,000
Options Outstanding at end of period | shares	5,325,000
Exercisable at beginning of period | shares	5,425,000
Exercisable at end of period | shares	5,325,000
Weighted Average Exercise Price
Outstanding, Beginning | $ / shares	$ 0.19
Granted | $ / shares
Cancelled | $ / shares
Expired | $ / shares	0.25
Outstanding, Ending | $ / shares	0.19
Exercisable, Beginning | $ / shares	0.19
Exercisable, Ending | $ / shares	$ 0.19
Weighted Average Remaining Contractual Term
Outstanding, Beginning	1 year 6 months 26 days
Outstanding, Ending	1 year 1 month 2 days
Options exercisable, Beginning	1 year 6 months 26 days
Options exercisable, Ending	1 year 1 month 2 days
Aggregate Intrinsic Value
Outstanding, Beginning | $
Outstanding, Ending | $

Stockholders' Equity (Deficit29

Stockholders' Equity (Deficit) (Details Narrative)	6 Months Ended
	Jun. 30, 2016USD ($)
Stockholders Equity Deficit Details Narrative
Non-cash stock-based compensation expense	$ 903
Unrecognized non-cash stock-based compensation expense remains	$ 0

Equity Commitment and Related30

Equity Commitment and Related Party Transactions (Details Narrative) - USD ($)	6 Months Ended
	Jun. 30, 2016	Dec. 31, 2015
Equity Commitment And Related Party Transactions Details Narrative
Amount available for equity commitments	$ 500,000	$ 500,000
Claim against related party	12,500
Equity commitment to interim capital investor	$ 1,000,000

Convertible Short-term Notes 31

Convertible Short-term Notes Payable (Details Narrative) - Convertible Short Term Notes Payable [Member] - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015	Dec. 31, 2015
Interest expense related to issuance Notes	$ 29,513	$ 30,840	$ 62,765	$ 60,593
Amortization of deferred financing cost	0	$ 27,189	17,008	53,403
Deferred financing cost balance	0		0		$ 17,008
Amortization of debt discount			97,688	$ 202,568
Debt balance	1,092,500		1,092,500		982,689
Debt discount	0		0		109,811
Accrued interest	218,398		218,398		158,997
Related Party [Member]
Debt balance	57,500		57,500		52,615
Debt discount	0		0		4,885
Accrued interest	$ 11,732		$ 11,732		$ 8,368

Long Term Notes Payable (Detail

Long Term Notes Payable (Details Narrative) - Long Term Notes Payable [Member] - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015	Dec. 31, 2015
Interest expense related to issuance Notes	$ 14,918	$ 0	$ 25,120	$ 0
Amortization of deferred financing cost	6,209	0	12,418	0
Deferred financing cost balance	28,451		28,451		$ 40,869
Amortization of debt discount	35,729	$ 0	71,458	$ 0
Debt balance	237,996		237,996		153,308
Debt discount	132,004		132,004		216,692
Accrued interest	35,793		35,793		12,874
Related Party [Member]
Debt balance	28,944		28,944		29,757
Debt discount	16,056		16,056		15,243
Accrued interest	$ 3,797		$ 3,797		$ 1,565

Short Term Notes Payable issu33

Short Term Notes Payable issued in Q1 2016 (Details Narrative) - 2016 Q1 Short Term Notes Payable [Member] - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Interest expense related to issuance Notes	$ 6,249	$ 0	$ 6,249	$ 0
Amortization of debt discount			0	$ 0
Debt balance	254,796		254,796
Debt discount	18,954		18,954
Accrued interest	4,575		4,575
Related Party [Member]
Debt balance	93,075		93,075
Debt discount	6,925		6,925
Accrued interest	$ 1,674		$ 1,674

Short Term Notes Payable issu34

Short Term Notes Payable issued in Q2 2016 (Details Narrative) - 2016 Q2 Short Term Notes Payable [Member] - USD ($)	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Amortization of debt discount	$ 0	$ 0
Debt balance	11,238
Debt discount	1,262
Accrued interest	0
Related Party [Member]
Debt balance	35,962
Debt discount	4,038
Accrued interest	$ 0

Blencathia Merger (Details Narr

Blencathia Merger (Details Narrative) - USD ($)	Jun. 30, 2016	Dec. 31, 2015
Blencathia Merger Details Narrative
Other accrued expenses	$ 190,000	$ 190,000

Derivative Liability (Details)

Derivative Liability (Details)	6 Months Ended
	Jun. 30, 2016
Convertible Note [Member] | December 31, 2015 measurement [Member]
Stock price volatility	174.00%
Convertible Note [Member] | June 30, 2016 measurement [Member]
Stock price volatility	209.00%
Convertible Note [Member] | Probability of default triggering [Member]
Stock price volatility	0.00%
Convertible Note [Member] | Probability of the Company redeeming the convertible note [Member]
Stock price volatility
Warrant [Member] | December 31, 2015 measurement [Member]
Stock price volatility	174.00%
Warrant [Member] | June 30, 2016 measurement [Member]
Stock price volatility	209.00%

Derivative Liability (Details 1

Derivative Liability (Details 1)	6 Months Ended
	Jun. 30, 2016USD ($)
Derivative Liability Details 1
Derivative liability, Beginning Balance	$ 425,035
Gain on change of fair value	(321,230)
Issuance of warrants	31,179
Derivative liability, Ending Balance	$ 134,984

Derivative Liability (Details 2

Derivative Liability (Details 2)	6 Months Ended
	Jun. 30, 2016$ / sharesshares
Derivative Liability Details 2
Total # of warrants issued and outstanding | shares	53,743,666
Weighted-average exercise price	$ 0.10
Remaining life (in years)	2 years 8 months 12 days
Intrinsic value

Derivative Liability (Details N

Derivative Liability (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015	Dec. 31, 2015
Derivative Liability Details Narrative
Exercise price	$ 0.14		$ 0.14		$ 0.14
Warrants issued to investor due to reset features	1,620,015		1,620,015		1,430,134
Total convertible debt and warrant's derivative liability	$ 134,984		$ 134,984
Gain on derivative liability	$ 258,793	$ 27,860	$ 321,230	$ 65,166

Legal Proceedings (Details Narr

Legal Proceedings (Details Narrative) - USD ($)	Jun. 30, 2016	Dec. 31, 2015
Legal Proceedings Details Narrative
Other accrued expenses	$ 190,000	$ 190,000