Note 9 - Stockholders' Deficit

9 Months Ended

Sep. 30, 2014

Notes

Note 9 - Stockholders' Deficit

NOTE 9 – STOCKHOLDERS’ DEFICIT

As discussed in Note 1, stockholders holding a majority of the voting power of the our outstanding voting stock, as well as our Board of Directors, approved an amendment to our Articles of Incorporation dated December 30, 2013 to (a) effect  a reverse stock split of our common stock by a ratio of one-for-seven hundred fifty (1:750) and (b) reduce the number of authorized shares of common stock from 1,500,000,000 to 50,000,000.  The Financial Industry Regulatory Authority (“FINRA”) approved the reverse stock split effective January 13, 2014, and the reverse stock split has been given retroactive effect in our consolidated financial statements for all periods presented.

Subsequently on September 24, 2014, stockholders holding a majority of the voting power of the outstanding voting stock of the Company, as well as the Company’s Board of Directors, acted by written consent to approve an amendment to the Company’s Articles of Incorporation to increase the number of authorized shares of common stock from 50,000,000 to 500,000,000.

During the nine months ended September 30, 2014, we issued a total of 37,510,802 shares of our common stock: 39,668 shares at par value for 39,668 unissued common shares; 388 shares valued at $1 for rounding in the reverse stock split; 20,740,000 shares valued at $2,038,345 for services; and 16,730,746 shares with a total value of $1,082,656 for conversion of debt.   We also cancelled 9,300,000 shares of common stock, valued at par value of $23,250, when exchanged by officers and one of our founders for 186,000 shares of Series BB Preferred Stock.

On June 13, 2014, the Company filed a Certificate of Designations, Preferences and Rights (the “Certificate”) with the Nevada Secretary of State to establish a class of preferred stock designated as Series AA Preferred Stock (the “Series AA Preferred Stock”), and has authorized the issuance of up to 1,000,000 shares of such Series AA Preferred Stock.  Among other things, the Series AA Preferred Stock allows holders thereof enhanced voting rights based on ten thousand (10,000) votes per share of the Company’s common stock held by such holders of Series AA Preferred Stock.  The Series AA Preferred Stock is not convertible into common stock, does not pay dividends, and does not include a liquidation preference.

On June 19, 2014, 20,000 shares of Series AA Preferred Stock were issued to each of the four members of the Company’s Board of Directors for services and valued at par value totaling $80.

On July 31, 2014, the Company filed a Certificate of Designations, Preferences and Rights (the “Certificate”) with the Nevada Secretary of State to establish a class of preferred stock designated as Series BB Preferred Stock (the “Series BB Preferred Stock”), and has authorized the issuance of up to 1,000,000 shares of such Series BB Preferred Stock.  Among other things, the Series BB Preferred Stock allows holders thereof voting rights equal to holders of common stock as a single class with respect to all matters submitted to holders of common stock, quarterly dividends payable in arrears in either cash or in kind, liquidation preferences, and is convertible at the option of the holder into 50 common shares of the Company.

            On August 15, 2014, a total of 186,000 shares of Series BB Preferred Stock was issued to two officers and one of our founders upon their surrender of a total of 9,300,000 shares of common stock.