Note 10. Stockholders' Equity

12 Months Ended

Dec. 31, 2015

Stockholders' Equity Note [Abstract]

Stockholders' Equity Note Disclosure [Text Block]

Note 10. Stockholders’ Equity

Conversion of shares

During year ended December 31, 2015, the holders of our convertible notes elected to convert principal and interest into shares of common stock as detailed below:

Date	Amount Converted		Number of Shares Issued
January 12, 2015	$	300	$	30,000
January 14, 2015		300		30,000
January 27, 2015		320		32,000
February 6, 2015		350		35,000
February 16, 2015		350		35,000
February 16, 2015		350		35,000
February 16, 2015		350		35,000
February 26, 2015		400		40,000
February 26, 2015		400		40,000
March 11, 2015		1,900		190,000
March 12, 2015		1,900		190,000
April 1, 2015		2,000		200,000
April 13, 2015		2,000		200,000
April 28, 2015		2,300		230,000
May 5, 2015		2,300		230,000
May 22, 2015		2,500		250,000
June 2, 2015		2,500		250,000
June 16, 2015		2,800		280,000
June 23, 2015		2,900		290,000
June 25, 2015		1,800		180,000
June 26, 2015		1,400		140,000
June 29, 2015		1,000		100,000
June 30, 2015		2,800		280,000
July 8, 2015		2,270		227,000
July 15, 2015		2,250		225,000
July 16, 2015		1,750		175,000
July 17, 2015		3,750		375,000
July 17, 2015		3,750		375,000
July 21, 2015		2,350		235,000
July 21, 2015		1,000		100,000
July 31, 2015		3,100		310,000
August 5, 2015		1,370		137,000
August 13, 2015		3,280		328,000
August 27, 2015		3,330		333,000
September 11, 2015		4,850		485,000
September 11, 2015		3,300		330,000
September 11, 2015		1,500		150,000
September 11, 2015		1,500		150,000
September 24, 2015		2,650		265,000
September 29, 2015		1,400		140,000
October 2, 2015		3,150		315,000
October 8, 2015		4,100		410,000
November 17, 2015		7,410		741,000
December 22, 2015 *		4,100		410,000
Total	$	95,380	$	9,538,000

The shares issuable for the conversion on December 22, 2015 were issued on January 7, 2016. They are included in common stock payable on the balance sheet as of December 31, 2015.

During year ended December 31, 2014, the holders of our convertible notes elected to convert principal and interest into shares of common stock as detailed below:

Date	Principal & Interest Converted		Common Stock Issued upon Conversion
January 14, 2014	$	20,000		6,666
January 27, 2014		20,000		6,667
January 30, 2014		20,000		6,667
September 26, 2014		170		17,000
September 26, 2014		170		17,000
October 10, 2014		340		17,000
October 21, 2014		340		17,000
November 4, 2014		420		21,000
November 6, 2014		440		22,000
November 26, 2014		460		46,000
December 9, 2014		250		25,000
December 11, 2014		260		26,000
December 12, 2014		250		25,000
December 18, 2014		250		25,000
Total	$	63,350		278,000

Discount on Beneficial Conversion Feature of Convertible Notes Payable

During the year ended December 31, 2015 the Company issued convertible notes payable. At the time of the conversion, we recorded a discount to convertible notes payable to reflect the beneficial conversion feature of the note.

Date Issued	Maturity Date	Interest Rate			Conversion Rate		Amount of Note		Beneficial Conversion Feature
March 31, 2015	March 31, 2017		10	%	$	1.10	$	87,970	$	87,970
June 30, 2015	June 30, 2017		10	%		0.15		81,813		81,813
September 30, 2015	September 30, 2018		10	%		0.06		326,402		326,402
December 31, 2015	December 31, 2018		10	%		0.01		103,595		103,595
							$	599,780	$	599,780

During the year ended December 31, 2014, the Company signed convertible promissory notes, which refinanced non-interest bearing advances in the amount of $365,107 into convertible notes payable. These notes are payable along with interest at maturity and bear interest at 10% per annum. The holder of the notes may not convert the convertible promissory note into common stock if that conversion would result in the holder owing more than 4.99% of the number of shares of common stock outstanding on the conversion date. The convertible promissory notes are convertible into common stock at the option of the holder.

Date Issued	Maturity Date	Interest Rate			Conversion Rate Per Share		Amount of Note
June 30, 2014	June 30, 2016		10	%	$	0.005	$	162,947
December 31, 2014	December 31, 2016		10	%		2.00		202,160
							$	365,107

The Company evaluated the application of ASC 470-50-40/55, Debtor’s Accounting for a Modification or Exchange of Debt Instrument as it applies to the note listed above and concluded that the revised terms constituted a debt modification rather than a debt extinguishment because the present value of the cash flow under the terms of the new instrument was less than 10% from the present value of the remaining cash flows under the terms of the original note. No gain or loss on the modifications was required to be recognized.

The Company evaluated the terms of the new note in accordance with ASC Topic No. 815 - 40, Derivatives and Hedging - Contracts in Entity’s Own Stock and determined that the underlying common stock is indexed to the Company’s common stock. The Company determined that the conversion features did not meet the definition of a liability and therefore did not bifurcate the conversion feature and account for it as a separate derivative liability. The Company evaluated the conversion feature for a beneficial conversion feature. The effective conversion price was compared to the market price on the date of the note and was deemed to be less than the market value of underlying common stock at the inception of the note. Therefore, the Company recognized beneficial conversion features as show in the table above. The beneficial conversion features were recorded as an increase in additional paid-in capital and a discount to the Convertible Notes Payable. Discounts to the Convertible Notes Payable are amortized to interest expense over the life of the note.

Imputed Interest

During years ended December 31, 2015 and 2014, we recognized imputed interest of $6,581 and $7,384, respectively, as an increase to shareholders’ equity.

Shares Issued to Purchase Fixed Assets

On March 13, 2015, we issued 3,000,000 shares of common stock, pursuant to the terms to acquire a class 5 clean room (See footnote 6). These shares are valued at $5,400,000. We are required to prepare and file a registration statement with the Securities and Exchange Commission to register the shares underlying this agreement within 30 days after the Closing Date and to use its best efforts to cause that registration statement to be declared effective within 270 days. The underlying asset was determined to be impaired as of December 31, 2015. See Note 7.

Reincorpo ration and reverse split

On July 28, 2014, the Company reincorporated from Delaware to Nevada. The reincorporation was approved by our board of directors and by the owners of a majority of our outstanding voting stock. Each of our shareholders as of the record date received one share of the Nevada company’s common stock for each 300 shares of our common stock they owned in the Delaware company, with fractional shares be rounded up to the next whole share, and number of additional whole shares such that each shareholder will own at least five shares. This effectively resulted in a one-for-300 reverse split. All share and per share amounts have been restated to reflect the reverse split.

Issuance of Common Stock for Cash

On February 6, 2014, the Company received a stock purchase agreement from Eastern Rim Funds Inc., a significant shareholder of the Company, to purchase 100,000 shares of common stock of the Company for $30,000 in cash. The Company also received a cash payment of $30,000. The par value of the common stock was included in stock payable on the balance sheet as of March 31, 2014.

The Company recorded stock compensation expense in the amount of $300,000, which represented the difference in the fair market value of the common stock as of February 6, 2014 and the price paid by Eastern Rim Funds Inc.

On May 27, 2014, our board of directors approved the issuance of these shares. Accordingly, the par value of the common stock was removed from common stock payable on our balance sheet and added to our common stock.

The issuance of these shares resulted in Eastern Rim Funds Inc. holding a total of 173,521 shares of the Company’s common stock. Eastern Rim Funds Inc. held approximately 53% of the outstanding stock of the Company after the issuance.