Note 13 - Convertible Debt and Derivative Valuation |
12 Months Ended |
|---|---|
Dec. 31, 2016 | |
| Debt Disclosure [Abstract] | |
| Debt Disclosure [Text Block] | Note 13 – Convertible Debt and Derivative Valuation In accordance with the Statement of Financial Accounting Standard ASC 820-10-35-37 Fair Value in Financial Instruments, Statement of Financial Accounting Standard ASC 815 Accounting for Derivative Instruments and Hedging Activities require that instruments with embedded derivative features be valued at their market values. The Company hired a valuation consultant to value the Convertible Debentures for the derivative portion of the instruments. The Binomial model was used to value the derivative liability for the fiscal year ending December 31, 2016 During the year ended December 31, 2016, the Company funded operations with borrowing on six convertible promissory notes, in an amount ranging from $27,777 to $55,000, maturing within from one year to two years, bearing interest ranging from 5% to 12% per annum, convertible into common stock at conversion prices ranging from 45% to 60% of the lowest price in the prior 20 to 25 trading days. Prior to December 31, 2016 all convertible debt was converted to common shares. The total amount of the borrowing amounted to $234,777. Interest accrual to conversions dates accounted for another $11,454 and commissions paid to agents were $18,375. The holders of the notes converted all the amounts due to their firms for 198,737,390 (19,873,374 post reverse split) shares of common stock during the period September 28, 2016 through December 7, 2016. When the selling was completed, the Company had approximately 268,718,761 shares outstanding. This prompted the Company to consider the 1 for 10 reverse split of the common shares which was accomplished on January 13, 2017. All shares are updated to reflect the reverse split. The initial valuation of the derivative liability on the converted common shares totaled $743,467 as calculated by consultants for the Company when all notes were issued, but before any conversions. This valuation represents $508,690 in excess of the funds received of $234,777 and this value was recorded as a derivative liability on the balance sheet. This value includes the fair value of the shares issued according to the contracts of the holders and valued according to our common share price at the time of acquisition. As a result of such issuances and conversions, all six (6) of the notes have paid in full as of December 31, 2016. From September 28, 2016 through December 7, 2016, the Company issued an aggregate of 198,737,390 pre-split (19,873,739) post- split) shares of its common stock upon conversions of six different convertible notes at conversion prices ranging from $0.0015 to $0.0047 per share. After considering the funds received for the shares and amortization of original derivative liability and the changes in the liability due to market conditions, the Company recorded equity of $424,878 for the conversion transactions. |