STOCK OPTIONS AND WARRANTS

3 Months Ended

Mar. 31, 2014

Temporary Equity Disclosure [Abstract]

STOCK OPTIONS AND WARRANTS

The following is a summary of option activity during the three months ended March 31, 2014.

	Number of Shares		Weighted Average Exercise Price
Balance, December 31, 2013		9,300,000	$	0.05
Options granted and assumed		—	$	—
Options expired		—	$	—
Options canceled		—		—
Options exercised		—		—
Balance, March 31, 2014		9,300,000	$	0.05

As of March 31, 2014, 9,300,000 stock options are exercisable.

On September 23, 2013, the Company granted stock options for 300,000 shares of its common stock with a strike price of $0.03. The stock options were exercisable upon grant and have a life of 5 years. The stock options were valued at $8,400 using the Black-Scholes option pricing model based upon the following assumptions: term of 5 years,  risk free interest rate of 1.33%, a dividend yield of 0% and volatility rates of 443%.   The Company recorded an expense of $8,400 for the year ended December 31, 2013.

Stock warrants -

The following is a summary of warrants activity during the three months ended March 31, 2014.

	Number of Shares		Weighted Average Exercise Price
Balance, December 31, 2013		3,818,780	$	0.05
Warrants granted and assumed		—		—
Warrants expired		387,500		0.06
Warrants canceled		—		—
Warrants exercised		—		—
Balance, March 31, 2014		3,631,280	$	0.05

All warrants outstanding as of March 31, 2014 are exercisable.

On February 11, 2013, the Company issued a warrant for 180,915 shares of common stock to the note holder with a exercise price of $0.05. The vesting period on these grant was immediate. The value of these warrants were estimated by using the Black-Scholes option pricing model with the following assumptions: expected life of 2 years; risk free interest rate of 0.27%; dividend yield of 0% and expected volatility of 178%. To account for such grants to non-employees, we recorded the issuance as consulting expense in the amount of $1,683.

On February 11, 2013, the Company issued a warrant for 90,365 shares of common stock to a note holder with a exercise price of $0.05. The vesting period on these grant was immediate. The value of these warrants were estimated by using the Black-Scholes option pricing model with the following assumptions: expected life of 2 years; risk free interest rate of 0.27%; dividend yield of 0% and expected volatility of 178%. To account for such grants to non-employees, we recorded the issuance as consulting expense in the amount of $840.

On May 22, 2013, the Company issued a warrant for 200,000 shares of common stock to Retire Happy, LLC for Consulting services. The warrants have an exercise price of $0.04 and the vesting period on these grants was immediate. The value of these warrants were estimated by using the Black-Scholes option pricing model with the following assumptions: expected life of 1 years; risk free interest rate of 0.11%; dividend yield of 0% and expected volatility of 167%. To account for such grants to non-employees, we recorded the issuance as consulting expense in the amount of $3,000.