Quarterly report pursuant to Section 13 or 15(d)

NOTE 6 - STOCKHOLDER EQUITY

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NOTE 6 - STOCKHOLDER EQUITY
6 Months Ended
Jun. 30, 2014
Stockholders' Equity Note [Abstract]  
Stockholders' Equity Note Disclosure [Text Block]
NOTE 6 — STOCKHOLDER EQUITY

There is not a viable market for the Company’s common stock to determine its fair value; therefore, management is required to estimate the fair value to be utilized in the determining stock based compensation costs.  In estimating the fair value, management considers recent sales of its common stock to independent qualified investors, placement agents’ assessments of the underlying common shares relating to our sale of preferred stock and validation by independent fair value experts. Considerable management judgment is necessary to estimate the fair value.  Accordingly, actual results could vary significantly from management’s estimates.

Preferred stock

The Company is authorized to issue 1,000,000 shares of  $0.001 par value preferred stock. As of June 30, 2014 and December 31, 2013,  the Company has designated and issued 200 and 184.4 shares of Series A preferred stock, respectively, designated and issued 600 and 177.5 shares of Series B preferred stock, respectively. See Note 4.

As of June 30, 2014 and December 31, 2013, the Company designated and  issued 4,200 and 2,781shares of Series C 9% convertible preferred stock, respectively. See Note 5.

On June 23, 2014, the Company issued an aggregate of 577,901 and 493,818 shares of its common stock in exchange of all the issued and outstanding Series A and Series B preferred stock.

Common stock

The Company is authorized to issue 50,000,000 shares of $0.001 par value common stock. As of June 30, 2014 and December 31, 2013, the Company has 9,821,288 and 8,412,101 shares issued and outstanding, respectively.

During the six months ended June 30, 2014, the Company entered into a securities purchase agreement with investors pursuant to which the Company issued 337,468 shares of common stock and five-year warrants for aggregate proceeds of $732,666.