6. DERIVATIVE LIABILITIES AND FAIR VALUE MEASUREMENTS (Tables)

3 Months Ended

12 Months Ended

Mar. 31, 2016

Dec. 31, 2015

Notes to Financial Statements

Fair value of financial liabilities

	Level 1		Level 2		Level 3		Total
Derivative liability	$	—	$	—	$	—	$	—
Total	$	—	$	—	$	—	$	—

Items recorded or measured at fair value on a recurring basis in the accompanying consolidated financial statements consisted of the following items as of March 31, 2016:

	Level 1		Level 2		Level 3		Total
Derivative liability	$	—	$	—	$	732,260	$	732,260
Total	$	—	$	—	$	732,260	$	732,260

 The following table provides a summary of changes in fair value of the Company’s Level 3 financial liabilities for the three months ended March 31, 2016:

Balance, December 31, 2015	$	—
Transfers in of Level 3		509,404
Mark-to-market – loss on change in fair value of derivative liability - 2016		222,856
Balance, March 31, 2016	$	732,260

Balance, December 31, 2013	$	—
Transfers in of Level 3		346,467
Mark-to-market – loss on change in fair value of derivative liability - 2014		753,241
Balance, December 31, 2014	$	1,099,708
Mark-to-market – loss on change in fair value of derivative liability -2015		2,236,401
Transfers out of Level 3		(3,336,109	)
Balance, December 31, 2015	$	—

Derivative Liabilities Assumptions Used

	Commitment Date		Premeasurement Dates
Expected dividends		0%		0%
Expected volatility		150%		75% - 150%
Expected term		3-5 years		1.83 – 4.70 years
Risk free interest rate		0.75% - 1.1%		0.89% - 1.37%