STOCKHOLDERS' EQUITY

12 Months Ended

Dec. 31, 2012

Notes to Financial Statements

NOTE 8 - STOCKHOLDERS' EQUITY

In December, 2007, the Company adopted the Crown Equity Holdings, Inc. Consultants and Employees Stock Plan for 2007. Under the Plan, 10,000,000 shares are reserved for issuance to employees, officers, directors, advisors and consultants.

During 2011, the Company issued 44,623,007 common shares with a value of $895,821 for services.

During 2011, the Company issued 600,000 shares of Class A preferred shares for $600,000 cash. Each share is convertible into 100 common shares at the option of the holder. Crown Equity evaluated the convertible preferred stock under FASB ASC 470-20-30 and determined it contained a beneficial conversion feature. The intrinsic value of the beneficial conversion feature was determined to be $600,000. The beneficial conversion feature was fully amortized and recorded as a deemed dividend.

During 2012, the Company issued:

·   15,779,045 common shares for services with a value of $239,111

·   60,000,000 common shares for the conversion of 600,000 preferred shares

·   1,000,000 common shares for cash of $10,000,

·   and 5,900,000 common shares for the conversion of notes payable valued at $66,200 (see Note 6).

During 2012, the Company also cancelled 713,288 shares originally issued to an independent contractor upon his resignation from the company.