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COMMITMENTS AND CONTINGENCIES
3 Months Ended
Mar. 31, 2015
COMMITMENTS AND CONTINGENCIES [Abstract]  
COMMITMENTS AND CONTINGENCIES

NOTE 7 – COMMITMENTS AND CONTINGENCIES

 

Operating Lease

 

On October 18, 2013, the Company entered into a lease agreement with a third party to rent office premises. The lease commencement date was November 1, 2013 and ends on December 31, 2016. The Company entered into a lease addendum on February 20, 2015. Pursuant to the lease addendum, the monthly lease payment is $2,600 for January 1, 2015 through June 30, 2015, and increases to $4,800 per month starting July 1, 2015. The lease term is through February 28, 2021.

 

Rent expense was $7,800 and $7,500 for the quarters ended March 31, 2015 and 2014, respectively.

 

Employment Agreements

 

CEO employment agreement

 

On January 1, 2014 the Company entered into an employment agreement with its CEO, effective through December 31, 2016. Pursuant to the agreement, the CEO shall receive a minimum annualized salary of $300,000. During the three months ended March 31, 2015, the Company recorded $75,000 of compensation expense for this agreement, which is recorded in accrued expenses at March 31, 2015.

 

CFO employment agreement

 

On December 31, 2014, the Company entered into an employment agreement with its CFO, effective through March 31, 2018. From December 31, 2014 through March 31, 2015, the CFO remained an independent contractor for the Company and received $14,110 in consulting fees through March 31, 2015. On April 1, 2015, the CFO became a full-time contractor and will receive an annualized salary of $208,000, of which 50% shall be paid in cash and 50% shall be paid in stock options.

 

In addition, the CFO will be provided with a 3% ownership of the Company to be issued in common stock. The shares vest in three 1% installments on January 1, 2016, 2017, and 2018. The Company will value this obligation each quarter and record a common stock payable until the obligation is paid for in common stock of the Company. Pursuant to this agreement, the Company recorded share-based compensation expense of $41,671 for the three months ended March 31, 2015.