Capital Stock

12 Months Ended

Dec. 31, 2014

Capital Stock

Capital Stock

Preferred Stock

 The Company has authorized 25,000,000 shares of preferred stock, of which 20,500,000 is designated as Series B Convertible Preferred Stock, $0.01 par value, with a stated value of approximately $166,769  (“Series B Preferred”).  The remaining authorized preferred shares have not been designated by the Company as of December 31, 2014.  During the year ended December 31, 2014, 3,739,286 shares of Series B Preferred stock were converted into a like number of shares of common stock.

 On November 19, 2010, the Company filed a Certificate of Withdrawal of the Certificates of Designations of the Series A Preferred Stock (“Series A Preferred”) with the Nevada Secretary of State, as there were no shares of Series A Preferred issued and outstanding after the exchange transaction discussed below. 

 Series B Convertible Preferred Stock

 The Company has authorized 20,500,000 shares of Series B Preferred, $0.01 par value.  The Series B Preferred ranks prior to the Common Stock for purposes of liquidation preference, and to all other classes and series of equity securities of the Company that by their terms did not rank senior to the Series B Preferred (“Junior Stock”).  Holders of the Series B Preferred are entitled to receive cash dividends, when, as and if declared by the Board of Directors, and they shall be entitled to receive an amount equal to the cash dividend declared on one share of Common Stock multiplied by the number of shares of Common Stock equal to the outstanding shares of Series B Preferred, on an as converted basis.  The holders of Series B Preferred have voting rights to vote as a class on matters a) amending, altering or repealing the provisions of the Series B Preferred so as to adversely affect any right, preference, privilege or voting power of the Series B Preferred; or b) to effect any distribution with respect to Junior Stock.  At any time, the holders of Series B Preferred may, subject to limitations, elect to convert all or any portion of their Series B Preferred into fully paid nonassessable shares of Common Stock at a 1:1 conversion rate.

 At December 31, 2014, the Company had 16,676,942 shares of Series B Preferred issued and outstanding with a liquidation preference of $166,769, and convertible into 16,676,942 shares of Common Stock.

Common Stock

 The Company has authorized 150,000,000 shares of its Common Stock, $0.01 par value. The Company had issued and outstanding 63,341,163 and 52,728,644 shares of its Common Stock at December 31, 2014 and 2013.

 During the year ended December 31, 2014, the Company issued 3,739,286 shares of Common Stock from the conversion of Series B Preferred stock; 1.8 million shares of Common Stock issued in connection with a professional services agreement, 300,000 shares of Common Stock issued to a consultant for financial services, 300,000 shares of Common Stock as settlement of accounts payable, 1.9 million shares of Common Stock issued to management, 500,000 shares of Common Stock to certain Bridge Note investors and 2,367,352 shares of to certain note investors as payment of accrued interest on convertible notes payable.  At December 31, 2014, 800,000 of the aforementioned shares are reserved for issuance.

 During the year ended December 31, 2013, the Company reserved for issuance 300,000 shares Common Stock as settlement of accounts payable, and 1,900,000 shares of Common Stock as compensation to its three board members.