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DEBT AND CONVERTIBLE LOAN PAYABLE

3 Months Ended

Mar. 31, 2017

Debt And Convertible Loan Payable [Abstract]

NOTE 8 - DEBT AND CONVERTIBLE LOAN PAYABLE

Convertible Note Payable

On March 20, 2017, the Company settled $225,500 in principal and interest, plus 115% multiplied by the principal amount of $225,500 plus accrued interest of $8,846 on the principal amount of a promissory note with Chuck Rifici Holdings, Inc originally dated September 26, 2016. The Company settled the amount owed by paying $269,498 in cash. The Company was released from any further liability under this Rifici Note upon payment of this amount.

On March 20, 2017, the Company settled $275,000 in principal and interest, plus 115% multiplied by the principal amount of $275,000 plus accrued interest of $7,333 on the principal amount of a promissory note with FirstFire Global Opportunities Fund, LLC originally dated October 19, 2016 and December 12, 2016. The Company settled the amount owed by paying $252,917 in cash and issuing 333,333 shares of common stock with a fair value of $100,000 based upon the conversion price of $0.30 per share. The Company was released from any further liability under this FirstFire Global Opportunities Fund, LLC Note upon payment of this amount.

On March 24, 2017, the Company entered into a securities purchase agreements with Tangiers Global, LLC, relating to the issuance and sale of notes of $550,000 in aggregate principal amount including $250,000 actual payment of purchase price plus a 10% original issue discount.

The notes carry an interest on the unpaid principal amount at the rate of 8% per annum. Any Principal Amount or Interest which is not paid when due shall bear interest at the rate of 18% per annum from the due date until the same is paid. The March 24, 2017 note matures on November 24, 2017 and may be prepaid in whole or in part except otherwise explicitly set forth in the Note. If the Company exercises its right to prepay or repay the Note, the Company shall make payment to the note holders of an amount in cash equal to the following:

Days Since Effective Date		Prepayment Amount
Under 90 days		115% of principal amount
91 - 135 days		120% of principal amount
136 - 180 days		155% of principal amount

After 180 days from the effective date of this note may not be prepaid.

The notes convert into shares of Common Stock at a price equal to $0.30; provided, however that from and after the occurrence of any Event of Default hereunder, the Conversion Price shall be the lower of: (i) the Fixed Conversion Price or (ii) 65% multiplied by the lowest sales price of the Common Stock in a public market during the fifteen (15) consecutive Trading Day period immediately preceding the Trading Day that the Company receives a Notice of Conversion (as defined in the Note). For the three months ended March 31, 2017, the Company received $275,000 proceeds less $25,000 in original issuance discount fee pursuant to the terms of this convertible note. For convertible debt, the convertible was not in default as of March 31, 2017, as a result, the Company will record a BCF and related debt discount.

For the three months ended March 31, 2017, the Company accrued $422 in accrued interest related to outstanding the note.

Debt Discount and Original Issuance Costs

During the three months March 31, 2017 and March 31, 2016, the Company recorded debt discounts and original issuance costs totaling $120,333 and $176,916, respectively.

The debt discounts recorded in 2017 and 2016, pertain to beneficial conversion feature on the convertible notes. The notes are required to be bifurcated and reported at fair value on the date of grant. (see Note 1 Fair Value Measurements).

The Company amortized $156,055 and $8,654 to interest expense during the three months ended March 31, 2017 and 2016, as follows:

	Three Months Ended			Year Ended
	March 31, 2017			December 31, 2016
Debt discount, beginning of period	$	152,617		$	-
Additional debt discount		120,333			417,834
Amortization of debt discount		(156,055	)		(265,217	)
Debt discount, end of period	$	116,895		$	152,617

Debt Issuance Costs

During the three months ended March 31, 2017 and March 31, 2016, the Company paid debt issuance costs totaling $0 and $20,000, respectively.

During the three months ended March 31, 2017 and March 31, 2016, the Company amortized $0 and $978 of debt issue costs, respectively.

	Three Months Ended		Year Ended
	March 31, 2017		December 31, 2016
Debt discount, beginning of period	$	-	$	-
Additional debt discount		-		20,000
Amortization of debt discount		-		(978	)
Debt discount, end of period	$	-	$	19,022