Convertible Notes Payable | At September 30, 2017 and December 31, 2016, convertible notes payable consisted of the following: September 30, 2017 December 31, 2016 Convertible notes payable $ 590,526 $ 1,054,865 Unamortized debt discounts (34,753 ) (86,409 ) Total $ 555,773 $ 968,456 The outstanding convertible notes bear interest ranging from 8% to 12% on all notes in default and three notes from inception, are due on demand and are convertible into common stock at variable rates based upon discounts to the market price of the common stock. The Company identified embedded derivatives related to the outstanding convertible notes. These embedded derivatives included certain conversion features. The accounting treatment of derivative financial instruments requires that the Company record the fair value of the derivatives as of the inception date of the convertible notes and to adjust the fair value as of each subsequent balance sheet date. At September 30, 2017, the aggregate fair value of the outstanding derivative liabilities was determined to be $939,321. The fair value of the embedded derivatives was determined using the Black Scholes Option Pricing Model based on the following assumptions: The fair value of the outstanding embedded derivatives of $939,321 at September 30, 2017 was determined using the Black Scholes Option Pricing Model with the following assumptions: Dividend yield: -0-% Market price of common stock: $0.0002 Expected volatility: Maximum Risk free rate: 1.06% At September 30, 2017, the Company adjusted the recorded fair value of the derivative liability to market resulting in a non-cash, non-operating loss of $675,372 and $119,897 for the three and nine months ended September 30, 2017, respectively. The fair value of the outstanding embedded derivatives of $912,520 at September 30, 2016 was determined using the Black Scholes Option Pricing Model with the following assumptions: Dividend yield: -0-% Market price of common stock: $0.013 Expected volatility: Maximum Risk free rate: 0.36% At September 30, 2016, the Company adjusted the recorded fair value of the derivative liability to market resulting in non-cash, non-operating gain of 95,947 and $831,685 for the three and nine months ended September 30, 2016. In January 2017, the Company entered into a convertible debt agreement with a principal amount of $53,000 with 8% interest per annum. This note is convertible at a 42% discount to the average of the three lowest intraday trading prices of the 10 days preceding the conversion request. This note becomes convertible at or after maturity (180 days). The default interest rate is 22% per annum. In February 2017, the Company entered into a convertible debt agreement with a principal amount of $33,000 with 12% interest per annum. This note is convertible at a 42% discount to the average of the three lowest intraday trading prices of the 10 days preceding the conversion request. This note becomes convertible at or after maturity (180 days). The default interest rate is 22% per annum. In February 2017, the Company entered into a convertible debt agreement with a principal amount of $200,000 with 12% interest per annum. The Company had received $40,000 as of the filing date. This note is convertible at a 42% discount to the average of the lowest intraday trading price of the 25 days preceding the conversion request. This note is payable one year from each tranche date. The lender may convert at any-time at its choice. The default interest rate is 22% per annum. In June 2017, the Company recorded a convertible promissory note for a non-cash commitment fee of $50,000 for a purchase agreement. The $50,000 was recorded as a non-cash consulting and included in the operating expenses in the three and six-month Statements of operations for the period ended June 30, 2017. Notes in default and included in Current Notes Payable were $590,526 at September 30, 2017. During the nine months ending September 30, 2017 certain conversions reflected default penalties due to our delinquency in reporting its financial information in a timely and other default provisions related to these notes payable resulting in a total of $155,416 of conversions expensed as loss on note conversion penalties in the Statements of Operations for the nine months ended September 30, 2017. We recorded an expense of $68,204 the same type of expense for the three months with the same period ending September 30, 2017. |