Quarterly report pursuant to Section 13 or 15(d)

Stock Based Compensation

Stock Based Compensation

6 Months Ended

Jun. 30, 2015

NOTE 8 – STOCK BASED COMPENSATION

On May 20, 2014, the Company approved future issuances of performance based restricted common shares to the following employees and outside consultants. The Company accounts the issuances of restricted common shares, as defined by ASC 718, Compensation—Stock Compensation, in accordance with ASC 718. The restricted common shares will be issued upon completion of certain tasks or deliverables and contain certain exercise price with no expiration period.

On May 28, 2015, the Company has elected to grant warrants to certain entities and individuals in lieu of restricted common stocks granted but no yet issued.

A summary of the status of the Company’s restricted common shares is presented below:

	Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in Years)	Aggregate Intrinsic Value
Outstanding at December 31, 2013		-		-
Granted		1,760,000	$	0.17
Exercised		-		-
Forfeited or expired		-		-
Outstanding at December 31, 2014		1,760,000	$	0.17	N/A	$	246,400
Granted		-		-
Exercised		-		-
Superseded by May 28 Stock Warrants		1,760,000		-
Outstanding at June 30, 2015

Vested at June 30, 2015		-		-	N/A	$	-

The stock warrants issued in lieu of restricted common stock granted but not yet issued is presented below:

Date Issued	Exercise Price		Number of Shares		Expiration date

May 28, 2015 (Issued in lieu of restricted common stock)	$	0.11		2,720,000	May 27, 2020
May 28, 2015	$	0.11		25,000	May 27, 2020
June 16, 2015	$	0.11		2,000,000	June 15, 2020

Total warrants at June 30, 2015				4,745,000	4.92 years

As of June 30, 2015, the weighted average contractual life of the stock warrants is 4.92 years. The initial fair value of the warrants issued in lieu of restricted common stock was estimated at an aggregate value of $29,920, which was lower than the fair value of stocks originally issued and cancelled, therefore, no incremental expense was recorded. The initial fair value of the new warrants issued on for services was estimated at an aggregate value of $22,275. All warrants are vested and exercisable immediately.