SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2014 |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | NOTE 15: SUBSEQUENT EVENTS |
|
Issuance of Common Stock |
|
From July 1, 2014 until March 4, 2015, the Company converted a total of $156,800 loan principal plus $18,540 accrued interest and fees into 767,447,441 shares of common stock. |
|
On August 27, 2013 the Company received proceeds of $10,500 for the exercise of 1,093,750 warrants and as of December 31, 2013 the shares had not been issued and accordingly the Company recorded the liability for the share issuance. On August 19, 2014 the Company issued the warrant holder 9,545,455 shares which represented the fair value of $10,500 of the proceeds received. |
|
On July 9, 2013 the Company received proceeds of $27,923 for the exercise of 2,389,817 warrants and as of December 31, 2013 the shares had not been issued and accordingly the Company recorded the liability for the share issuance. On August 19, 2014 the Company issued the warrant holder 27,202,727 shares which represented the fair value of $27,923 of the proceeds received. |
|
On July 1, 2014, the Company issued 7,634,921 shares of common stock to a note lender for failing to issue shares timely upon receipt of the conversion notice from the lender. The Company recorded $12,979 of interest expense for such issuance. |
|
On September 15, 2014, the Company issued 7,027,778 shares of common stock to a note lender for failing to issue shares timely upon receipt of the conversion notice from the lender. The Company recorded $4,919 of interest expense for such issuance. |
|
On January 7, 2015, the Company issued 172,654,147 shares of common stock to a note lender for failing to issue shares timely upon receipt of the conversion notice from the lender. The Company recorded $17,265 of interest expense for such issuance. |
|
On January 9, 2015, the Company issued 48,456,897 shares of common stock to a note lender for failing to issue shares timely upon receipt of the conversion notice from the lender. The Company recorded $4,846 of interest expense for such issuance. |
|
Issuance of Promissory Notes |
|
On December 23, 2014 the Company issued a promissory note for $ 15,000 to Southridge II, a related party. The note matures on March 31, 2015 with the stated interest rate at 8%. |
|
Issuance of Series H Preferred Stock |
|
From July 1, 2014 Through October 1, 2014, the Company issued 12 shares of Series H Preferred Stock with a stated value of $300,000 to Tarpon, a related party, as compensation per the terms of a consulting agreement entered into with Tarpon on June 13, 2014. |
|
Issuance of Convertible Promissory Notes |
|
On July 17, 2014 the Company issued a convertible promissory note for $ 23,000. The note matures on June 30, 2015 with the stated interest rate at 10%. The note is convertible into the Company’s common stock at a conversion price of $0.001 per share. In addition, 4,600,000 warrants were issued with an exercise price of $0.0012 per share. The warrants are fully vested and have a life of 5 years from date of issuance. |
|
On July 17, 2014 the Company issued a convertible promissory note for $ 20,000. The note matures on December 31, 2015 with the stated interest rate at 10%. The note is convertible into the Company’s common stock at a 50% discount of the lowest closing bid price during the 10 trading days prior to conversion. |
|
On August 13, 2014 the Company issued a convertible promissory note for $ 85,000. The note matures on June 30, 2015 with the stated interest rate at 8%. The note is convertible into the Company’s common stock at a 50% discount of the lowest closing bid price during the 20 trading days prior to conversion. |
|
On September 16, 2014 the Company issued a convertible promissory note for $ 23,000. The note matures on June 30, 2015 with the stated interest rate at 10%. The note is convertible into the Company’s common stock at a conversion price of $0.0005 per share. In addition, 9,200,000 warrants were issued with an exercise price of $0.0006 per share. The warrants are fully vested and have a life of 5 years from date of issuance. |
|
On October 21, 2014 the Company issued a convertible promissory note for $ 50,000. The note matures on May 01, 2015 with the stated interest rate at 0% and a premium to be paid on redemption of $20,000. Upon maturity, at the election of the holder, the note is convertible into the Company’s common stock at a 50% discount of the lowest closing bid price during the 10 trading days prior to conversion. |
|
On October 22, 2014 the Company issued a convertible promissory note for $ 14,000. The note matures on September 30, 2015 with the stated interest rate at 10%. The note is convertible into the Company’s common stock at a conversion price of $0.0004 per share. In addition, 7,000,000 warrants were issued with an exercise price of $0.00048 per share. The warrants are fully vested and have a life of 5 years from date of issuance. |
|
On November 10, 2014 the Company issued a convertible promissory note for $ 20,000 to Southridge II, a related party. The note matures on October 31, 2015 with the stated interest rate at 10%. The note is convertible into the Company’s common stock at a 50% discount of the lowest closing bid price during the 30 trading days prior to conversion. The conversion price is subject to anti-dilution protection in the event that the Company issues additional equity securities at a price less than the conversion price. |
|
On November 13, 2014 the Company issued a convertible promissory note to a related party for $ 12,500 to Southridge II, a related party. The note matures on October 31, 2015 with the stated interest rate at 10%. The note is convertible into the Company’s common stock at a 50% discount of the lowest closing bid price during the 30 trading days prior to conversion. The conversion price is subject to anti-dilution protection in the event that the Company issues additional equity securities at a price less than the conversion price. |
|
On November 17, 2014 the Company issued a convertible promissory note for $ 4,156 to Tarpon, a related party. The note matures on October 31, 2015 with the stated interest rate at 10%. The note is convertible into the Company’s common stock at a 50% discount of the lowest closing bid price during the 30 trading days prior to conversion. The conversion price is subject to anti-dilution protection in the event that the Company issues additional equity securities at a price less than the conversion price. |
|
On November 17, 2014 the Company issued a convertible promissory note for $ 25,000. The note matures on December 31, 2015 with the stated interest rate at 10%. The note is convertible into the Company’s common stock at a conversion price of $0.0002 per share. In addition, 25,000,000 warrants were issued with an exercise price of $0.00024 per share. The warrants are fully vested and have a life of 5 years from date of issuance. |
|
On January 15, 2015 the Company issued a convertible promissory note for $ 10,500 to Tarpon, a related party. The note matures on January 31, 2016 with the stated interest rate at 10%. The note is convertible into the Company’s common stock at a 50% discount of the lowest closing bid price during the 30 trading days prior to conversion. The conversion price is subject to anti-dilution protection in the event that the Company issues additional equity securities at a price less than the conversion price. |
|
On February 3, 2015 the Company issued a convertible promissory note for $ 50,000. The note matures on August 31, 2015 with the stated interest rate at 8%. The note is convertible into the Company’s common stock at a 50% discount of the lowest closing bid price during the 20 trading days prior to conversion. The conversion price is subject to anti-dilution protection in the event that the Company issues additional equity securities at a price less than the conversion price. |
|
On February 11, 2015 the Company issued a convertible promissory note for $ 11,000 to Tarpon, a related party. The note matures on January 31, 2016 with the stated interest rate at 10%. The note is convertible into the Company’s common stock at a 50% discount of the lowest closing bid price during the 30 trading days prior to conversion. The conversion price is subject to anti-dilution protection in the event that the Company issues additional equity securities at a price less than the conversion price. |
|
On February 23, 2015 the Company issued a convertible promissory note for $ 25,000 to Tarpon, a related party. The note matures on February 29, 2016 with the stated interest rate at 10%. The note is convertible into the Company’s common stock at a 50% discount of the lowest closing bid price during the 30 trading days prior to conversion. The conversion price is subject to anti-dilution protection in the event that the Company issues additional equity securities at a price less than the conversion price. |
|
Entry Into A Material Definitive Agreement |
|
On September 30, 2014 the Company entered into an agreement in-order to satisfy an outstanding liability of the Company to our former Vice President of International Markets, Shaul Kochan, dating back to 2009. Per the terms of the agreement the Company shall issue 110 shares of preferred stock with a stated value equal to $110,000. The Company has agreed to redeem the preferred stock in 14 separate tranches at the beginning of each calendar month beginning October 1, 2014, pursuant to the following schedule: $5,000 in stated value worth of shares each month for the first 4 months; $7,500 in stated value worth of shares each month for the subsequent 6 tranches; $10,000 in stated value worth of shares each month for the subsequent 3 tranches; and $15,000 in stated value worth of shares in the final month. |
|
If the Company misses payment of any tranche it will have 30 calendar days in which to cure such payment, after which time the Company agrees to issue additional shares of preferred stock representing 1% of the aggregate stated value of the then outstanding preferred stock held by Mr. Kochan, redeemable under similar terms. As of March 4, 2015 the Company has not made the January, February and March 2015 redemption payments due to Mr. Kochan. |
|
In addition, the Company agrees to extend the maturity date of the outstanding warrant held by Mr. Kochan from its current expiration date of March 7, 2015 to March 7, 2017. The Company further agrees to issue an additional warrant to Mr. Kochan for right to exercise and purchase 2,000,000 shares of the Company’s common stock at an exercise price of $0.052 and maturity date of March 7, 2017. |
|
Entry Into A Material Definitive Agreement |
|
On October 24, 2014, the Company entered into an agreement in-order to satisfy outstanding liabilities of the Company due to our former Chief Financial Officer (“CFO”) and Former Director, Terry R. Lazar (“Lazar”), dating back to 2009. Mr. Lazar acted as CFO for the Company until February 15, 2014, and the Company has accrued approximately $485,000 in deferred compensation on behalf of Lazar, including accrued warrants for his services on the Company’s Board (“Deferred Comp”). In addition, Lazar has loaned approximately $225,000 to the Company in the form of loans(s) (“Loan”). Mr. Lazar and the Company have agreed to satisfy and terminate all Deferred Comp and Loan obligations of the Company due to Lazar by having the Company issue to Lazar a new series of preferred stock. |
|
Per the terms of the agreement the Company shall issue 200 shares of preferred stock with a stated value equal to $200,000. The preferred stock shall carry an annual dividend yield of 5%, and shall be convertible into 100,000,000 shares of common stock at the option of Lazar. The Company has the option to redeem the preferred stock at any time for an amount equal to its stated value plus any accrued dividend by paying cash to Lazar subject to a conversion notice tendered by the holder within five days from receipt of a redemption notice. |
|
Mr. Lazar on February 4, 2015, advised the Company in writing that he was rescinding the agreement. The Company believes that the agreement is a valid and binding agreement between the Company and Mr. Lazar. |
|
Definitive Information Statement filed with SEC for Capital Increase and Reverse Stock Split |
|
A Preliminary Information Statement was filed with the SEC on October 24, 2014, and the Definitive Information Statement on December 11, 2014, to notify the Company’s stockholders that on October 24, 2014, our stockholders approved the following amendments (the “Amendments”) to our Certificate of Incorporation: (1) a Reverse Stock Split of the Company’s common stock at a ratio of not less than one-for-one hundred and not more than one-for-five hundred as determined by our Board of Directors (the “Reverse Stock Split”), subject to the Board’s discretion to determine, without any further action by stockholders, not to proceed with a reverse stock split if it determines that a reverse stock split is no longer in the best interest of the Company and its stockholders, and (2) the authorization of an increase in the number of authorized shares of common stock from two billion (2,000,000,000) shares of common stock, par value $.001 per share, to ten billion (10,000,000,000) shares of common stock, par value $.00001 per share. The Amendment increasing our authorized common stock to 10,000,000,000 shares has become effective with the filing of the Certificate of Amendment with the Secretary of State of the State of Delaware. Following Board determination of the Reverse Stock Split ratio, the Company plans to file for approval of and an effective date for the Reverse Stock Split with the Financial Industry Regulatory Authority. |
|
Entry Into A Material Definitive Agreement |
|
On February 6, 2015, the Company entered into an agreement in-order to satisfy outstanding liabilities of the Company due to our Chief Executive Officer (“CEO”), Leslie Kessler (“Kessler”), dating back to 2007. Ms. Kessler acts as CEO for the Company, and the Company has accrued approximately $874,000 in deferred compensation on behalf of Kessler, including accrued warrants for her services on the Company’s Board (“Deferred Comp”). In addition, Kessler has loaned approximately $168,000 to the Company in the form of loans(s) (“Loan”). Ms. Kessler and the Company have agreed to satisfy and terminate all Deferred Comp and Loan obligations of the Company due to Kessler, apart from a $17,500 loan to the Company which shall remain outstanding to Kessler, by having the Company issue to Kessler a new series of preferred stock. |
|
Per the terms of the agreement the Company shall issue 325 shares of preferred stock with a stated value equal to $325,000. The preferred stock shall carry an annual dividend yield of 5%, and shall be convertible into 650,000,000 shares of common stock at the option of Kessler. The Company has the option to redeem the preferred stock at any time for an amount equal to its stated value plus any accrued dividend by paying cash to Kessler subject to a conversion notice tendered by the holder within five days from receipt of a redemption notice. |
|
In addition, during 2015 Kessler shall receive monthly compensation of $10,000 in cash, $5,000 in stated value of Series H Preferred Stock and be eligible to receive cash and equity bonus compensation from revenue received from sales generated by her. |
|