Convertible Notes | Note 5- Convertible Notes Convertible notes originally due on November 27, 2015 ( CN#1) On November 27, 2012, the Company entered certain convertible loan agreements with four (4) investors. The Company received a total of $125,000 which bears interest at 10% per annum and is due on November 27, 2015. Interest shall accrue from the advancement date and shall be payable quarterly. Any portion of the loan and unpaid interest are convertible at any time at the option of the lender into shares of common stock of the Company at a conversion price of $0.0005 per share. On the date of the agreements, the Company recognized the intrinsic value of the embedded beneficial conversion feature of $125,000 as additional paid-in capital and reduced the carrying value of the convertible debenture to $nil. The carrying value will be accreted over the term of the convertible debentures up to its face value of $125,000. On August 1, 2014, the Company successfully amended the terms of the aforementioned loan agreements. Under the amended terms, a total of $125,000 originally available for conversion into 250,000,000 shares of common stock at $0.0005 per share was amended to reflect a fixed conversion price of $0.005 per share for a total of 25,000,000 shares of common stock, if converted. The Company analyzed the above amendment under ASC 470-60 and concluded that the amendment to the conversion terms qualified as a substantial modification, and as such the remaining unamortized discount of $88,184 as of the amendment date, was recorded as loss on extinguishment of debt. The Company recalculated the intrinsic value of the embedded beneficial conversion feature of $125,000, which amount was recorded as the discount on the amended convertible notes. The carrying value will be accreted over the term of the convertible notes up to their face value of $125,000. Concurrently, in August 2014, the conversion features in respect to these notes became tainted upon the issuance of other variable rate convertible debt. Accordingly, we accounted for the conversion options in respect to these notes as derivative liabilities. On July 16, 2015, the Company again amended the terms of the convertible loan agreements for a total of $125,000 to extend the maturity date from November 27, 2015 to April 16, 2016. Subsequently, the parties agreed the notes would mature on January 1, 2017. The notes were further modified whereby they do not become convertible until maturity. Upon the change to the terms of the convertible notes, the Company analyzed the conversion feature for derivative accounting consideration under FASB ASC 470 and determined that the conversion feature would not create embedded derivatives until maturity, January 1, 2017. Further upon maturity, and due to the continuing existence of other variable rate convertible debt, we accounted for the conversion options in respect to these notes as derivative liabilities. As a result on January 1, 2017 we recorded a loss on derivative liabilities of $21,140. At the nine months ended September 30, 2017 we revalued the derivative liabilities and recorded a gain of $10,009. The carrying value of these convertible notes is as follows: September 30, 2017 December 31, 2016 December 31, 2015 Face value of certain convertible notes 125,000 125,000 125,000 Less: unamortized discount - - - Carrying value 125,000 125,000 125,000 As at September 30, 2017 and December 31, 2016, the carrying values of the convertible debenture was $125,000. During the three and nine months ended September 30, 2017, accrued convertible interest thereon was $3,116 and $9,349 respectively. The notes came due on January 1, 2017 and are currently in default. ( 2) Convertible note due on January 25, 2017 (CN#2) On January 25, 2016, the Company entered into a convertible loan agreement with an investor. The Company received net proceeds totaling $30,000 from total loan proceeds of $35,000, which bears interest at 8% per annum and is due on January 25, 2017. Financing fees of $3,000 and legal fees of $2,000 were paid in respect of the note. Interest shall accrue from the advancement date and shall be payable on maturity. Any portion of the loan and unpaid interest are convertible at any time at the option of the lender into shares of common stock of the Company at a conversion price of 52% of the lowest trading prices for the previous twelve (12) trading days to the date of conversion. As of December 31, 2016, the balance payable on CN #2 includes $35,000 in principal from convertible notes and $2,616 in accrued interest payable. The following table reflects the details of the issuance of 290,187,136 shares in respect of Conversion Notices received for a total of $35,000 in principal and $2,792 in accrued interest from CN#2 with $3,520 in transfer agent fees during the nine months ended September 30, 2017: Conversion Date Original Principal Amount ($) Accrued interest payable ($) Transfer Agent Fees ($) Conversion Price ($) Number of shares issued 5,000 - $ - 16,025,641 January 9, 2017 6,660 - 440 0.000260 27,307,692 January 12, 2017 4,458 - 440 0.000156 31,397,436 January 17, 2017 4,702 - 440 32,961,538 January 18, 2017 4,959 - 440 0.000156 34,608,974 January 19, 2017 3,272 - 440 35,692,308 3,396 - 440 0.0000936 40,980,235 January 24, 2017 1,553 2,033 440 0.0000936 43,015,491 January 26, 2017 1,000 759 440 0.00007799 28,197,821 Total 35,000 2,792 3,520 290,187,136 As of September 30, 2017, the principal amount and all accrued interest payable with respect to the aforementioned convertible notes was paid in full with issuance of common stock. Convertible note due on May 24, 2017 (CN#3) The following table reflects the details of the issuance of 726,933,349 shares in respect of Conversion Notices received for a total of $46,000 in principal and $2,625 in accrued interest from CN#3 during the nine months ended September 30, 2017: Conversion Date Original Principal Amount ($) Accrued interest payable ($) Conversion Price ($) Number of shares issued 2,500 126 0.00012 21,883,561 January 18, 2017 2,700 140 0.00008 35,495,753 3,250 172 2,750 150 48,334,703 2,900 159 50,981,735 February 2, 2017 2,900 160 0.00006 50,992,328 2,900 160 51,002,922 February 7, 2017 3,300 185 0.00006 58,086,027 February 90, 2017 3,300 186 0.00006 58,110,136 February 10, 2017 3,650 207 0.00006 64,286,666 February 15, 2017 3,825 221 0.00006 67,438,767 4,025 235 0.00006 70,9943,83 March 21, 2017 5,250 343 0.00008 69,911,301 March 23, 2017 2,750 181 0.00008 36,635,273 46,000 2,625 726,933,349 As of September 30, 2017, the principal amount and all accrued interest payable with respect to the aforementioned convertible notes was paid in full with issuance of common stock. On January 11, 2017, in respect of the backend note . During the quarter ended June 30, 2017 the convertible note fell into default due to the Company failure to be current in its filings with the Securities and Exchange Commission. Upon an event of default the interest rate is increased to 24% As at September 30, 2017 the carrying values of the back-end convertible debenture and accrued convertible interest thereon were $49,680 and $6,099, respectively. Convertible note due on July 13, 2017 (CN#4) The following table reflects the issuance of 49,290,170 shares in respect of Conversion Notices received for a total of $10,731 in principal and $137 in accrued interest during the year ended December 31, 2016 and the issuance 52,933,533 shares in respect of Conversion Notices received for a total of $10,300 in principal and $278 in accrued interest during the nine months ended September 30, 2017: Original Principal Amount ($) Accrued interest payable ($) Conversion Price ($) Number of shares issued September 7, 2016 4,800 5 0.00020 24,026,301 5,931 133 0.00024 25,263,869 5,150 141 0.00020 26,455,479 January 9, 2017 5,150 146 0.00020 26,478,054 Total 21,031 425 102,223,703 As of September 30, 2017, the principal amount and all accrued interest payable with respect to the aforementioned convertible notes was paid in full with issuance of common stock. (5) Convertible note due on January 5, 2018 (CN#5) In our evaluation of the aforementioned financing arrangements, we concluded that the conversion features were not afforded the exemption as a conventional convertible instrument and it did not otherwise meet the conditions set forth in current accounting standards for equity classification. Accordingly, they do not meet the conditions necessary to obtain equity classification and are required to be carried as derivative liabilities. (See footnote 7 for derivative disclosure) The carrying value of certain convertible notes (CN#2, CN#3, CN#4, C#5) are as follows: CN#2 CN#3 CN#4 CN#5 Total Carrying value, December 31, 2016 $ 32,699 $ 27,853 $ 5,665 $ - $ 64,112 Face value of certain convertible notes 35,000 46,000 21,031 - 102,031 Add: Face value of certain convertible notes - 46,000 - 15,000 61,000 Face value due to default 3,680 - 3,680 Less: Face value converted to shares (35,000 ) (46,000 ) (21,031 ) - (102,031 ) - - (7,908 ) (7,908 ) Less: deferred financing costs - - - - $ - $ 49,680 $ - $ 7,092 56,772 Amortization of |