(7) Derivative Instruments

12 Months Ended

Dec. 31, 2017

Notes

(7) Derivative Instruments

(7)  Derivative Instruments:

The Company has certain notes payable with elements that qualify as derivatives. The notes payable had a variable conversion feature that similarly prevented the calculation of the number of shares into which they were convertible.

The derivative liability, as it relates to the different instruments, is shown in the following table:

	Year Ended December 31, 2017
	Conversion Feature
	of
	Notes Payable
Beginning balance, January 1	$                                           -
Additional issuances	1,079,942
Exercised/converted	-
Reclassification to equity	-
Change in value of derivative liability	707,121
Ending balance, December 31	$                              1,787,063

The derivative liability was valued using the Black-Scholes method with the following inputs:

	Year Ended	Year Ended
	December 31, 2017	December 31, 2016
Expected life in years	0.4 - 0.96 years	N/A
Stock price volatility	283.6% - 343.6%	N/A
Discount rate	0.12%	N/A
Expected dividends	None	N/A
Forfeiture rate	0%	0%